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Letter of Offer January 14, 2016
For the Equity Shareholders of our Company only
JMC PROJECTS (INDIA) LIMITED
The Company was originally incorporated as Civen Construction Private Limited on June 5, 1986 under the Companies Act, 1956 with its registered office at Ahmedabad. Subsequently on December 10, 1987, the name was changed to Joshi & Modi Constructions Private Limited. The name was further changed to JMC Projects (India) Private
Limited on January 21, 1994 and was subsequently converted into a Public Limited Company in the name of JMC Projects (India) Limited on February 4, 1994.
Registered Office: A-104, Shapath-4, Opposite Karnavati Club, S.G.Road, Ahmedabad – 380 051, India
Tel: +91-79-3001 1500, Fax: +91-79-3001 1700
Mumbai Office: 6th
Floor, Kalpataru Synergy, Opp. Grand Hyatt, Santacruz (East), Mumbai 400055, Maharashtra, India
Tel: +91 22 30051500, Fax: +91 22 30051555
Contact Person: Mr. Sandeep Kumar Sharma, Company Secretary and Compliance Officer, E-mail: [email protected]; Website: www.jmcprojects.com
Promoter of the Company: Kalpataru Power Transmission Limited
FOR PRIVATE CIRCULATION TO THE EQUITY SHAREHOLDERS OF JMC PROJECTS (INDIA) LIMITED
(THE “COMPANY” OR THE “ISSUER”) ONLY
ISSUE OF 74,62,686 FULLY PAID-UP EQUITY SHARES OF FACE VALUE OF ` 10 EACH (“RIGHTS EQUITY SHARES”) FOR CASH AT A PRICE OF
` 201 PER EQUITY SHARE INCLUDING A SHARE PREMIUM OF ` 191 PER EQUITY SHARE AGGREGATING UPTO ` 15,000 LACS TO OUR
EXISTING EQUITY SHAREHOLDERS ON A RIGHTS BASIS IN THE RATIO OF 2 FULLY PAID-UP EQUITY SHARE(S) FOR EVERY 7 FULLY PAID-
UP EQUITY SHARE(S) HELD BY THE EXISTING EQUITY SHAREHOLDERS ON THE RECORD DATE, I.E. JANUARY 12, 2016 (“THE ISSUE”). THE
ISSUE PRICE IS 20.1 TIMES THE FACE VALUE OF THE EQUITY SHARE. FOR FURTHER DETAILS, PLEASE SEE THE SECTION “TERMS OF
THE ISSUE” ON PAGE 167 OF THE LETTER OF OFFER. THE ENTIRE ISSUE PRICE FOR THE EQUITY SHARE IS PAYABLE ON APPLICATION.
GENERAL RISKS
Investment in equity and equity related securities involve a degree of risk and investors should not invest any funds in the Issue unless they can afford to take the risk of
losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in the Issue. For taking an investment decision,
investors must rely on their own examination of the Issuer and the Issue including the risks involved. The securities being offered in the Issue have not been recommended or approved by Securities and Exchange Board of India (“SEBI”) nor does SEBI guarantee the accuracy or adequacy of the Letter of Offer. Investors are
advised to refer to the section “Risk Factors” on page 9 of the Letter of Offer, before making an investment in the Issue.
ISSUER’S ABSOLUTE RESPONSIBILITY
The Issuer, having made all reasonable inquiries, accepts responsibility for and confirms that the Letter of Offer contains all information with regard to the Issuer and the Issue, which is material in the context of the Issue, that the information contained in the Letter of Offer is true and correct in all material aspects and is not misleading in
any material respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes the Letter of Offer
as a whole or any such information or the expression of any such opinions or intentions misleading in any material respect.
LISTING
The existing Equity Shares are listed on the BSE Limited (“BSE”) and National Stock Exchange of India Limited (“NSE”), (together the “Stock Exchanges”). We have
received “in-principle” approvals from BSE and NSE for listing the Rights Equity Shares to be allotted in the Issue vide their letters dated October 23, 2015 and October
08, 2015, respectively. For the purposes of the Issue, the Designated Stock Exchange is BSE.
LEAD MANAGER TO THE ISSUE REGISTRAR TO THE ISSUE
Inga Capital Private Limited
Naman Midtown
21st Floor, ‘A’ Wing Senapati Bapat Marg, Elphinstone (West)
Mumbai – 400 013
Maharashtra, India Tel. No. : +91 22 4031 3489
Fax No. : +91 22 4031 3379 E-mail: [email protected]
Investor Grievance E-mail: [email protected]
Website: www.ingacapital.com Contact Person: Ashwani Tandon
SEBI Registration No: INM000010924
Link Intime India Private Limited
Pannalal Silk Mills Compound
L.B.S. Marg
Bhandup (West), Mumbai - 400 078 Maharashtra, India
Tel No.: +91 22 6171 5400 Fax No.: +91 22 2596 0329
Email: [email protected]
Investor Grievance E-mail: [email protected] Website: www.linkintime.co.in
Contact Person: Dinesh Yadav
SEBI Registration: INR000004058
ISSUE PROGRAMME
ISSUE OPENS ON
LAST DATE FOR RECEIPT OF
REQUEST FOR SPLIT
APPLICATION FORMS
ISSUE CLOSES ON
January 22, 2016 January 29, 2016 February 5, 2016
TABLE OF CONTENTS
SECTION I – GENERAL ............................................................................................................................. 1
DEFINITIONS AND ABBREVIATIONS .............................................................................................. 1
NOTICE TO OVERSEAS SHAREHOLDERS ....................................................................................... 6
CERTAIN CONVENTIONS, USE OF FINANCIAL, INDUSTRY AND CURRENCY OF
PRESENTATION ................................................................................................................................... 7
FORWARD LOOKING STATEMENTS................................................................................................ 8
SECTION II - RISK FACTORS .................................................................................................................. 9
SECTION III- INTRODUCTION ............................................................................................................. 30
SUMMARY OF THE ISSUE ................................................................................................................ 30
SUMMARY OF FINANCIAL INFORMATION .................................................................................. 31
GENERAL INFORMATION ................................................................................................................ 34
CAPITAL STRUCTURE ...................................................................................................................... 38
OBJECTS OF THE ISSUE .................................................................................................................... 44
SECTION IV –STATEMENT OF TAX BENEFITS ............................................................................... 54
SECTION V -OUR MANAGEMENT ....................................................................................................... 67
SECTION VI – FINANCIAL INFORMATION ...................................................................................... 72
ACCOUNTING RATIOS AND CAPITALISATION STATEMENT ................................................ 143
STOCK MARKET DATA FOR EQUITY SHARES .......................................................................... 145
MATERIAL DEVELOPMENTS ........................................................................................................ 147
SECTION VII – LEGAL AND OTHER INFORMATION ................................................................... 148
OUTSTANDING LITIGATIONS AND DEFAULTS ........................................................................ 148
GOVERNMENT AND OTHER APPROVALS .................................................................................. 155
OTHER REGULATORY AND STATUTORY DISCLOSURES ....................................................... 156
SECTION VIII – OFFERING INFORMATION ................................................................................... 167
TERMS OF THE ISSUE ..................................................................................................................... 167
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION ............................................. 202
DECLARATION ...................................................................................................................................... 204
1
SECTION I – GENERAL
DEFINITIONS AND ABBREVIATIONS
Definitions
In the Letter of Offer, unless the context otherwise requires, the terms defined and abbreviations expanded below
shall have the same meaning as stated in this section. References to statutes, rules, regulations, guidelines and
policies will be deemed to include all amendments and modifications notified thereto.
Company Related Terms
Term Description
“our Company”, “the Company”,
“the Issuer Company” and “the
Issuer”
JMC Projects (India) Limited
“we”, “us” and “our” Our Company, its Subsidiaries and Joint Ventures including entities
controlled through contractual arrangements, except as the context
otherwise requires.
Articles/ AoA/ Articles of
Association
Our articles of association, as amended
Auditors Our statutory auditors, M/s. Kishan M. Mehta & Co, Chartered
Accountants (Firm’s Registration No.105229W)
Board of Directors/Board Our board of directors or any duly constituted committees thereof
CFO Chief Financial Officer of our Company
Directors Directors of our Company
Equity Shares Equity shares of face value of ` 10 each of our Company
Group Companies Group Companies includes such companies as covered under the
applicable accounting standards and also other companies as considered
material by the board of our Company.
The policy (as adopted by the Board of our Company vide resolution
dated September 11, 2015) to define the materiality requirement for a
company to be considered as a Group Company of our Company is as
follows:
“A Company shall be considered to be Material for purpose of its
inclusion as a Group Company in terms of the requirements of SEBI
(ICDR) Regulations, 2009 if and only if it fulfils any of the following
criteria’s:
a) Subsidiary companies of the JMC. or
b) Group companies as per applicable accounting standards, being
Accounting Standard 18, as mentioned in our financial statements
for fiscal year 2015 or annual financial statements or
c) Company in which JMC hold 20% or more equity shares with
voting rights or
d) Any other company or companies, as the Board may identify as
Group Companies of the JMC.”
Joint Ventures Kurukshetra Expressway Private Limited, JMC - Associated JV,
Aggrawal - JMC JV, JMC - Sadbhav JV, JMC - Taher Ali JV (Package I,
II & III), JMC - PPPL JV, KPTL-JMC-Yadav JV, JMC - GPT JV and
JMC - CHEC JV
Memorandum/ MoA/
Memorandum of Association
The memorandum of association of our Company, as amended
Mumbai Office 6th Floor, Kalpataru Synergy, Opp. Grand Hyatt, Santacruz (East),
Mumbai- 400055
Promoter Kalpataru Power Transmission Limited
Promoter Group Persons and entities constituting the promoter group of our Company in
terms of Regulation 2(1)(zb) of the SEBI ICDR Regulations
Registered Office A-104, Shapath - 4, S. G. Road, Opp. Karanavati Club, Ahmedabad-
2
Term Description
380051, Gujarat.
Subsidiaries Brij Bhoomi Expressway Private Limited, JMC Mining and Quarries
Limited, Wainganga Expressway Private Limited, and Vindhyachal
Expressway Private Limited
Issue Related Terms
Term Description
Abridged Letter of Offer The abridged letter of offer to be sent to the Equity Shareholders with
respect to the Issue in accordance with the SEBI ICDR Regulations
Allotment/ Allot/ Allotted Allotment of Rights Equity Shares pursuant to the Issue
Allottee(s) Persons to whom Right Equity Shares will be Allotted pursuant to the
Issue
Application
Unless the context otherwise requires, refers to an application for
Allotment of Rights Equity Shares in this Issue
Application Money Aggregate amount payable in respect of the Equity Shares applied for in
the Issue at the Issue Price
Application Supported by Blocked
Amount/ ASBA
The application (whether physical or electronic) used by ASBA Investors
to make an application authorizing the SCSB to block the amount payable
on application in ASBA Account
ASBA Account Account maintained with a SCSB and specified in the CAF or plain paper
application, as the case may be, for blocking the amount mentioned in the
CAF, or the plain paper application, as the case may be
ASBA Investor/ASBA Applicant Equity Shareholders proposing to subscribe to the Issue through ASBA
process and:
(a) Who are holding our Equity Shares in dematerialized form as on the
Record Date and have applied for their Rights Entitlements and/ or
additional Equity Shares in dematerialized form;
(b) Who have not renounced their Rights Entitlements in full or in part;
(c) Who are not Renouncees; and
(d) Who are applying through blocking of funds in a bank account
maintained with SCSBs.
All QIBs and other Investors whose application value exceeds ` 2 lacs
complying with the above conditions may participate in this Issue through
the ASBA process only
Banker to the Issue Yes Bank Limited
Composite Application Form/ CAF The form used by an Investor to make an application for the Allotment of
Rights Equity Shares in the Issue
Consolidated Certificate In case of holding of Equity Shares in physical form, the certificate that
would be issued for the Rights Equity Shares Allotted to one folio
Controlling Branches of the SCSBs Such branches of the SCSBs which coordinate with the Lead Manager,
the Registrar to the Issue and the Stock Exchanges, a list of which is
available on www.sebi.gov.in
Designated Stock Exchange BSE
Designated Branches Such branches of the SCSBs which shall collect application forms used
by ASBA Investors and a list of which is available on www.sebi.gov.in
Draft Letter of Offer/DLOF The draft letter of offer dated September 23, 2015 filed with SEBI for its
observations which does not contain complete particulars of the Issue
Equity Shareholders/ Eligible
Equity Shareholder(s)
A holder/beneficial owner of our Equity Shares as on the Record Date
Investor(s) The Equity Shareholders(s) on the Record Date, applying in this Issue,
and the Renouncees who have submitted an Application to subscribe to
the Issue
Inga Inga Capital Private Limited
Issue/ Rights Issue Issue of 74,62,686 Equity Shares of face value of ` 10 each for cash at a
price of ` 201 per Equity Share including a share premium of ` 191 per
Equity Share aggregating up to ` 15,000 lacs to our existing Equity
Shareholders on a rights basis in the ratio of 2 Equity Shares for every 7
3
Term Description
Equity Shares held by them on the Record Date
Issue Closing Date February 5, 2016
Issue Opening Date January 22, 2016
Issue Price ` 201 per Rights Equity Share
Issue Size Amount up to ` 15,000 lacs
Issue Proceeds The gross proceeds to be raised through this Issue
Lead Manager Inga Capital Private Limited
Letter of Offer/LOF The letter of offer dated January 14, 2016, filed with the Stock Exchanges
after incorporating the observations received from the SEBI on the Draft
Letter of Offer
Listing Agreement The listing agreements entered into between us and the Stock Exchanges
and as repealed/will be repealed by the Uniform Listing Agreement.
Net Proceeds The Issue Proceeds less the Issue related expenses. For further details,
please see section “Objects of the Issue” on page 44 of the Letter of Offer.
Non-ASBA Investor Investors other than ASBA Investors who apply in the Issue otherwise
than through the ASBA process
Non-Institutional
Investors Investor, including any company or body corporate, other than a Retail
Individual Investor and a QIB
Qualified Foreign Investors/ QFI Qualified Foreign Investor as defined under the Securities and Exchange
Board of India (Foreign Portfolio Investors) Regulations, 2014 (as
amended), registered with SEBI under applicable laws in India. A
Qualified Foreign Investor may buy, sell or otherwise continue to deal in
securities without registration as Foreign Portfolio Investors subject to
compliance with conditions specified in the SEBI (Foreign Portfolio
Investors) Regulations, 2014
QIBs or Qualified Institutional
Buyers
Qualified institutional buyers as defined under Regulation 2(1)(zd) of the
SEBI ICDR Regulations
Record Date January 12, 2016
Refund Banker Yes Bank Limited
Registrar to the Issue/ Registrar
and Transfer Agent/ RTA/Registrar
Link Intime India Private Limited
Renouncee(s) Any person(s) who has/ have acquired Rights Entitlements from Equity
Shareholders
Retail Individual Investors Individual Investors who have applied for Rights Equity Share for an
amount not more than ` 2 lacs (including HUFs applying through their
Karta)
Rights Entitlement The number of Rights Equity Share that an Investor is entitled to in
proportion to the number of Equity Shares held by the Investor on the
Record Date
Rights Equity Shares Equity Shares of the Company to be allotted pursuant to this Rights Issue.
SAF(s) Split Application Form(s)
SCSB(s) A Self Certified Syndicate Bank, registered with SEBI, which acts as a
banker to the Issue and which offers the facility of ASBA. A list of all
SCSBs is available at http://www.sebi.gov.in
SEBI Listing Regulations The Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements), 2015.
Stock Exchange(s) BSE and NSE, where our Equity Shares are presently listed
Uniform Listing Agreement The uniform listing agreement entered/to be entered between the Stock
Exchange and our Company, pursuant to the Listing Regulations and
SEBI Circular No. CIR/CFD/CMD/6/2015 dated October 13, 2015, in
relation to the listing of the Rights Equity Shares on the Stock Exchange.
Working Days Any day, other than Saturdays and Sundays, on which commercial banks
in Mumbai are open for business, provided however, for the purpose of
the time period between the Issue Closing Date and listing of the
Securities on the Stock Exchanges, “Working Days” shall mean all days
excluding 2nd
and 4th
Saturdays, Sundays and bank holidays in Mumbai in
accordance with the SEBI circular no. CIR/CFD/DIL/3/2010 dated April
4
Term Description
22, 2010
Conventional and General Terms/ Abbreviations/ Industry Related Terms
Term Description
Act/ Companies Act The Companies Act, 1956 and the notified provisions of the Companies
Act, 2013
AGM Annual General Meeting
AS Accounting Standards notified pursuant to the Companies (Accounting
Standards) Rules, 2006, as amended
BSE BSE Limited
CAGR Compounded Annual Growth Rate
Companies Act 1956 The Companies Act, 1956, as amended
Companies Act 2013 The Companies Act, 2013, to the extent notified
CDSL Central Depository Services (India) Limited
DBD Drawee Bill Discounting
Depositories Act The Depositories Act, 1996, as amended
Depository A depository registered with SEBI under the SEBI (Depositories and
Participant) Regulations, 1996
Depository Participant/ DP A depository participant as defined under the Depositories Act
DIN Director Identification Number
DP ID Depository Participant Identity
EC Extension Counter
EGM Extra-Ordinary General Meeting
EPS Earnings per Share
FBD Foreign Bills Discounting Limited
FCL Foreign Currency Loan
FDI Foreign Direct Investment
FEMA The Foreign Exchange Management Act, 1999, including the regulations
framed thereunder, as amended
FII Foreign Institutional Investor as defined under the Securities and
Exchange Board of India (Foreign Institutional Investors) Regulations,
1995 (as amended) and registered with SEBI and as repealed by Foreign
Portfolio Investors defined under the SEBI (Foreign Portfolio Investors)
Regulations, 2014. A Foreign Institutional Investor or a sub account may
buy, sell or otherwise continue to deal in securities without registration as
Foreign Portfolio Investors subject to compliance with conditions
specified in the SEBI (Foreign Portfolio Investors) Regulations, 2014.
FPI Foreign Portfolio Investor as defined under the Securities and Exchange
Board of India (Foreign Portfolio Investors) Regulations, 2014 (as
amended), registered with SEBI under applicable laws in India
Fiscal Year/ Fiscal Period of 12 months ended March 31 of that particular year
FIPB Foreign Investment Promotion Board, Ministry of Finance, GoI
FVCI Foreign Venture Capital Investors as defined under the Securities and
Exchange Board of India (Foreign Venture Capital Investors)
Regulations, 2000 (as amended) registered with SEBI under applicable
laws in India
GAAP Generally Accepted Accounting Principles
GoI Government of India
HUF Hindu Undivided Family
ICAI Institute of Chartered Accountants of India
IFRS International Financial Reporting Standards
IFSC Indian Financial System Code
ISIN International Securities Identification Number
IT Act The Income Tax Act, 1961, as amended
Indian GAAP Generally accepted accounting principles followed in India
LTLR Long Term Lending Rate
5
Term Description
MICR Magnetic Ink Character Recognition
Mutual Fund/ MF A mutual fund registered with SEBI under the SEBI (Mutual Funds)
Regulations, 1996
NAV Net Asset Value
NECS National Electronic Clearing Services
NEFT National Electronic Funds Transfer
NR Non-Resident
NRI Non-Resident Indian
NRE Account Non-Resident External Account
NRO Account Non-Resident Ordinary Account
NSDL National Securities Depository Limited
NSE National Stock Exchange of India Limited
OCB Overseas Corporate Body
p.a. Per Annum
PAN Permanent Account Number under the IT Act
PAT Profit After Tax
PBD Purchase Bill Discounting Limit
PBT Profit Before Tax
PC Packing Credit
PCFC Pre Shipment Credit in Foreign Currency
RBI Reserve Bank of India
Registrar of Companies/ RoC Registrar of Companies, Ahmedabad
Regulation S Regulation S under the Securities Act
Rupees/ INR/ `/ Rs. Indian Rupees
RTGS Real Time Gross Settlement
SEBI Securities and Exchange Board of India
SEBI Act Securities and Exchange Board of India Act, 1992
SEBI ICDR Regulations/ SEBI
Regulations
Securities and Exchange Board of India (Issue of Capital and Disclosure
Requirements) Regulations, 2009, as amended
SEBI Merchant Bankers
Regulations
Securities and Exchange Board of India (Merchant Bankers) Regulations,
2012, as amended
Securities Act U.S. Securities Act of 1933, as amended
Takeover Regulations Securities and Exchange Board of India (Substantial Acquisition of
Shares and Takeovers) Regulations, 2011, as amended
U.S./ US/ USA/United States United States of America
WCDL Working Capital Demand Loan
The words and expressions used but not defined herein shall have the same meaning as is assigned to such terms
under the Companies Act, as amended, the Securities Contracts (Regulation) Act, 1956, the Depositories Act,
1996 and the rules and regulations made thereunder.
6
NOTICE TO OVERSEAS SHAREHOLDERS
The distribution of the Letter of Offer and the issue of Right Equity Shares on a rights basis to persons in certain
jurisdictions outside India may be restricted by legal requirements prevailing in those jurisdictions. Persons into
whose possession the Draft Letter of Offer, Letter of Offer, Abridged Letter of Offer or CAF may come are
required to inform them about and observe such restrictions. We are making this Issue of Equity Shares on a
rights basis to the Equity Shareholders as on Record Date and will dispatch the Letter of Offer/ Abridged Letter
of Offer and CAFs to such Eligible Equity Shareholders who have provided an Indian address. Overseas
shareholders, who have not updated our records with their Indian address or the address of their duly authorized
representative in India, prior to the date on which we propose to dispatch the Letter of Offer / Abridged Letter of
Offer and CAFs, shall not be sent the Letter of Offer / Abridged Letter of Offer and CAFs.
No action has been or will be taken to permit this Issue in any jurisdiction where action would be required for
that purpose, except that the Draft Letter of Offer was filed with SEBI for observations. Accordingly, the Rights
Equity Shares may not be offered or sold, directly or indirectly, and the Letter of Offer/ Abridged Letter of Offer
and CAFs may not be distributed in any jurisdiction, except in accordance with legal requirements applicable in
such jurisdiction. Receipt of the Letter of Offer will not constitute an offer in those jurisdictions in which it
would be illegal to make such an offer and, under those circumstances, the Letter of Offer must be treated as
sent for information only and should not be acted upon for subscription to Rights Equity Shares and should not
be copied or redistributed. Accordingly, persons receiving a copy of the Letter of Offer should not, in
connection with the issue of the Rights Equity Shares, distribute or send the same in or into the United States or
any other jurisdiction where to do so would or might contravene local securities laws or regulations. If the Letter
of Offer is received by any person in any such territory, or by their agent or nominee, they must not seek to
subscribe to the Rights Equity Shares referred to in the Letter of Offer. Envelopes containing CAF should not be
dispatched from any jurisdiction where it would be illegal to make an offer, and all persons subscribing for the
Equity Shares in this Issue must provide an Indian address.
Any person who makes an application to acquire Equity Shares offered in this Issue will be deemed to have
declared, represented, warranted and agreed that he is authorised to acquire the Rights Equity Shares in
compliance with all applicable laws and regulations prevailing in his jurisdiction. We, the Registrar, the Lead
Manager or any other person acting on behalf of us reserve the right to treat any CAF as invalid where we
believe that CAF is incomplete or acceptance of such CAF may infringe applicable legal or regulatory
requirements and we shall not be bound to allot or issue any Equity Shares in respect of any such CAF. Neither
the delivery of the Letter of Offer nor any sale hereunder, shall under any circumstances create any implication
that there has been no change in the Company’s affairs from the date hereof or that the information contained
herein is correct as at any time subsequent to the date of the Letter of Offer.
The contents of the Letter of Offer should not be construed as legal, tax or investment advice. Prospective
investors may be subject to adverse foreign, state or local tax or legal consequences as a result of the offer
of Equity Shares. As a result, each investor should consult its own counsel, business advisor and tax
advisor as to the legal, business, tax and related matters concerning the offer of Equity Shares. In
addition, neither our Company nor the Lead Manager is making any representation to any offeree or
purchaser of the Equity Shares regarding the legality of an investment in the Equity Shares by such
offeree or purchaser under any applicable laws or regulations.
7
CERTAIN CONVENTIONS, USE OF FINANCIAL, INDUSTRY AND CURRENCY OF
PRESENTATION
Certain Conventions
References in the Letter of Offer to “India” are to the Republic of India and the “Government” or the “Central
Government” is to the Government of India (“GoI”) and to the ‘US’ or ‘U.S.’ or the ‘United States’ are to the
United States of America and its territories and possessions.
Financial Data
Unless stated otherwise, the financial data in the Letter of Offer is derived from our financial statements
prepared in accordance with Indian GAAP. Our fiscal year commences on April 1 of each year and ends on
March 31 of the succeeding year, so all references to a particular “Fiscal Year” or “Fiscal” are to the 12 month
period ended on March 31 of that year. Our audited consolidated and audited standalone financial statements for
the Fiscal 2015 and Fiscal 2014 the (“Financial Statements”), and limited reviewed unaudited standalone
financial statement for quarter ended September 30, 2015 and limited reviewed unaudited consolidated financial
statements for six month ended on Septmeber 30, 2015that appear in the Letter of Offer have been prepared by
our Company in accordance with Indian GAAP, applicable standards and guidance notes specified by the
Institute of Chartered Accountants of India, applicable accounting standards prescribed by the Companies
(Accounting Standards) Rules, 2006 and other applicable statutory and / or regulatory requirements. For further
details of such financial statements, see the section “Financial Information” on page 72 of the Letter of Offer.
We publish our financial statements in Indian Rupees.
In the Letter of Offer, any discrepancies in any table between the total and the sums of the amounts listed are
due to rounding off, and unless otherwise specified, all financial numbers in parenthesis represent negative
figures. Numerical values have been rounded off to two decimal places.
Unless stated otherwise, throughout the Letter of Offer, all figures have been expressed in Rupees in lacs.
Currency of Presentation
All references in the Letter of Offer to “Rupees”, “`”, “Rs.”, “Indian Rupees” and “INR” are to Indian Rupees,
the official currency of India.
Please Note:
One Lacs is equal to 100 thousand
One crore is equal to 10 million/100 Lacs
8
FORWARD LOOKING STATEMENTS
Certain statements in the Letter of Offer that are not statements of historical fact constitute ‘forward looking
statements’. Investors can generally identify forward-looking statements by terminologies such as “will”,
“may”, “aim”, “is likely to result”, “believe”, “expect”, “continue”, “anticipate”, “estimate”, “intend”, “plan”,
“contemplate”, “seek to”, “future”, “objective”, “goal”, “project”, “should”, “pursue” and similar expressions or
variations of such expressions, that are “forward looking statements”. Similarly, statements that describe our
objectives, strategies, plans or goals are also forward-looking statements. By their nature, forward-looking
statements involve inherent risks and uncertainties, both general and specific, and risks exist that the predictions,
forecasts, projections and other forward-looking statements will not be achieved.
All forward looking statements are subject to risks, uncertainties and assumptions about us that could cause
actual results to differ materially from those contemplated by the relevant forward-looking statement. Important
factors that could cause actual results to differ materially from plans, objectives, estimates, intentions and
expectations expressed in such forward looking statements include, but are not limited to:
Non-compliance with specific obligations under the financing agreements of our Company.
Delays in completion of construction of current and future projects leading to cost overruns;
Non-performance of obligations by our joint venture partners;
Disruption of operations of one or more of our projects and inability of our Company to collect toll on time
or at all.
Our ability to attract and retain qualified personnel;
Changes in laws and regulations relating to the industry in which we operate;
General economic and business conditions in the markets in which we operate;
Increasing competition in or other factors affecting the industry;
The performance of the financial markets in India and globally; and
Our ability to manage risks that arise from these factors.
For a further discussion of factors that could cause our actual results to differ, please see the section “Risk
Factors”. By their nature, certain market risk disclosures are only estimates and could be materially different
from what actually occurs in the future. As a result, actual future gains or losses could materially differ from
those that have been estimated.
The forward-looking statements contained in the Letter of Offer are based on the beliefs of management, as well
as the assumptions made by, and information currently available to, management of our Company. Whilst our
Company believes that the expectations reflected in such forward-looking statements are reasonable at this time,
it cannot assure investors that such expectations will prove to be correct. Given these uncertainties, Investors are
cautioned not to place undue reliance on such forward-looking statements. Neither we nor the Lead Manager nor
any of it’s respective affiliates, employees or directors make any representation, warranty or prediction that the
results anticipated by such forward-looking statements will be achieved, and such forward-looking statements
represent, in each case, only one of many possible scenarios and should not be viewed as the most likely or
standard scenario. Neither we nor the Lead Manager nor any of their respective affiliates or employees or
directors have any obligation to update or otherwise revise any statements reflecting circumstances arising after
the date hereof or to reflect the occurrence of underlying events, even if the underlying assumptions do not come
to fruition. In accordance with SEBI/ Stock Exchanges requirements, our Company and the Lead Manager will
ensure that Investors in India are informed of material developments until the time of the grant of listing and
trading permissions by the Stock Exchanges for the Equity Shares allotted pursuant to this Issue.
9
SECTION II - RISK FACTORS
An investment in our Equity Shares involves a degree of risk. You should consider all information in the Letter
of Offer, including the risks and uncertainties described below, before making an investment in our Equity
Shares. Investors should carefully consider all the information contained in the section titled “Financial
Information” on page 72 of the Letter of Offer for the information related to the financial performance of our
Company. If any of the following risks or any of the risks and uncertainties discussed in the Letter of Offer or
other risks that are not currently known or are now deemed immaterial, actually occur, our business, cash flow,
financial condition and results of operations could suffer, the trading price of our Equity Shares could decline
and you may lose all or part of your investment.
The risk set out in the Letter of Offer may not be exhaustive and additional risk and uncertainties not presently
known to us, or which may arise or may become material in the future. Further, some events may have a
material impact from a qualitative perspective rather than a quantitative perspective and may be material
collectively rather than individually. Investors are advised to read the risk factors carefully before taking an
investment decision in this offering. Before making an investment decision, investors must rely on their own
examination of the offer and us.
Unless specified or quantified in the relevant risk factors below, we are not in a position to quantify the
financial or other implication of any of the risks described in this section.
INTERNAL RISK FACTOR
1. There are legal proceedings currently outstanding involving our Company, our Subsidiaries and our
Joint Ventures. Any adverse decision may render us liable to liabilities/penalties and may adversely affect our
business, results of operations and profitability.
Our Company, our Subsidiaries and our Joint Ventures are involved in certain legal proceedings and claims in
relation to taxation incidental to our business and operations. These legal proceedings are pending at different
levels of adjudication before various courts and tribunals. Any adverse decision may render us liable to
liabilities/penalties and may adversely affect our business, results of operations and profitability. A summary of
material legal and other proceedings involving our Company, our Subsidiaries and Joint Ventures are given in
the following table:
Type of Proceedings Number of cases Amount to the extent
quantifiable (` in lacs)
Civil Proceedings 32 54,679.00
Criminal Proceedings 7 520.00
Total 39 55,199.00
For further details, please refer “Outstanding Litigations and Defaults” on page 148 of the Letter of Offer.
2. Our Company has given sponsor support undertakings and guarantee in relation to certain debt
facilities provided to our Subsidiaries and Joint Ventures, which, if called upon, may materially and
adversely affect our business, results of operations, cash flows and financial condition.
Our Company has given certain sponsor support undertakings and guarantee in favour of our Subsidiaries and
Joint Ventures in relation to certain liabilities including debt facilities availed by them. As per the standalone
Financial Statements, the guarantee outstanding as of March 31, 2015 was ` 19,921.21 lacs. In the event these
guarantees are enforced, our business, prospects, results of operations, cash flow and financial condition may be
adversely affected. Additionally, in the event that any of the guarantees provided by us is revoked, the lenders
for such facilities may require alternate guarantees, repayment of amounts outstanding under such facilities, or
even terminate such facilities. We may not be successful in procuring guarantees satisfactory to the lenders, and
as a result may need to repay outstanding amounts under such facilities or seek additional sources of capital,
which could affect our business, prospects, results of operations, cashflows and financial condition.
3. The financing arrangements entered into by our Company with some of our lenders imposes
requirement of obtaining consent from such lenders for issuing further securities and accordingly for
undertaking the Issue.
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We have entered into agreements and arrangements with certain banks and financial institutions for long-term
and short-term borrowings and we are subject to certain restrictive covenants. Under the terms of certain of our
Company’s debt agreements, our Company is required to send intimation to its lenders or obtain prior consent
from its lenders for, inter alia, change in the capital structure of our Company, making any change in
ownership, control or management and issuance of further securities. For the purpose of undertaking this Issue,
we have received consents from the lenders, as may be applicable, to proceed with this Issue, in terms of the
financing arrangements executed with such lenders.
Any inability to comply with the covenants under our financing arrangements or to obtain necessary consents
required thereunder may lead to the termination of our credit facilities, levy of penal interest, acceleration of all
amounts due under such facilities and the enforcement of any security provided. If the obligations under any of
our financing agreements are accelerated, we may have to dedicate a substantial portion of our cash flow from
operations to make payments under such financing documents, thereby reducing the availability of cash for our
working capital requirements and other general corporate purposes.
4. Increases in interest rates may materially impact our results of operations.
Our business requires a significant amount of working capital to finance the purchase of construction materials,
submission of earnest money deposit and other work on our construction projects before payment is
received from clients. We also avail term loans to meet our capital expenditure requirements.
Increases in interest expense may have an adverse effect on our results of operations and financial
condition. Our current debt facilities carry interest at variable rates as well as fixed rates with the provision for
periodic reset of interest rates. As of March 31, 2015, a major portion of our indebtedness was subject
to variable interest rates.
Although we may exercise the right available to our Company to terminate the current debt financing
arrangement on the respective reset dates and enter into new financing arrangements, there can be no assurance
that we will be able to do so on commercially reasonable terms, that its counterparties will perform their
obligations, or that these agreements, if entered into, will protect us fully against interest rate risk.
5. Our contingent liabilities that have not been provided for could materially and adversely affect our
financial condition and cash flows.
On the basis of the consolidated Financial Statements as at March 31, 2015, we had the following contingent
liabilities, which were not provided for:
(` in Lacs)
Particulars 2014-15
A Bank Guarantees 6.50
B Guarantees given in respect of performance of contracts of Joint Ventures Entities &
Associates in which company is one of the member / holder of substantial equity
17,671.21
C Guarantee given in favour of a subsidiary for Loan obtained by them 2,250.00
D Claims against the Company not acknowledged as debts (Refer note below) 263.02
E Show Cause Notice Issued by Service Tax Authorities 5,406.00
F Trichy Madurai Road Project Royalty Matter 39.87
G Disputed Income Tax Demand in appeal before Appellate Authorities (Excludes Amount
of Rs. 1794.13 (P.Y. Rs. 1794.13) considered in [I] hereinafter)
7,610.29
H Disputed Income Tax Demand of Joint Ventures in appeal before Appellate Authorities
(Excludes Amount of Rs. 214.70 (P.Y. Rs. 196.21) considered in [I] hereinafter)
8.77
I Disputed VAT Demand in appeal before Appellate Authorities 4,428.61
J Income Tax (Net of Deferred Tax) on the claim made of the deductions u/s. 80-IA (4) of
the Income Tax Act, 1961. (Refer note 28)
2,488.32
For other contingent liabilities, in addition to the above, see the section “Financial Information” on page 72 of
the Letter of Offer. If any of these contingent liabilities materialize, our profitability, cash flows could be
adversely affected.
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6. We rely on construction contracts awarded by our clients for our revenues, which may be subject to
variation or renegotiation in the scope of work by these clients. Any cost, if not reimbursed by our client,
incurred in excess of our contract value or anticipated revenues due to such restructuring or renegotiation
could reduce our profits.
We rely on construction contracts awarded by our clients for our revenues. In some of the contracts, we may
have limited ability to negotiate the terms of contracts which means that many terms in the agreement tend to
favour the client including, variation or renegotiation in the scope of work. Such variation and renegotiation of
projects may lead to delays which may lead to additional costs associated with cost increases in construction
materials and equipment, unless these contracts contain price escalation clauses. Any cost, if not reimbursed
by our client, incurred in excess of our contract value or anticipated revenues could result in additional costs,
which would reduce our profits. If we do not achieve expected turnover, margins or suffers losses on one or
more of these contracts, this could reduce our total income or cause us to incur losses.
7. We operate in a highly competitive market. If we are unable to win engineering construction
projects, both large and small, or compete with competitors, we could fail to increase, or maintain, our
volume of order intake and our results of operations may be materially adversely affected.
We face competition from other market players, which is determined by size, nature, complexity and
location of projects, proximity of materials to the local market, the availability of subcontractors,
construction workers and local economic conditions. While some of our competitors may have greater
resources in specific areas like capital, labour, equipment, technology, other resources, more extensive or
sophisticated marketing capabilities and at times may apply those resources and capabilities more
successfully than we do, the pricing policies of competitors may have an adverse effect on demand for our
services. Further, our ability to win projects is dependent on a number of factors including our ability to show
experience in executing large projects and to demonstrate that we have strong engineering capabilities in
executing technically complex projects. For many large construction contracts and infrastructure
development projects, we may not always meet the pre-qualification criteria on a standalone basis. We
face competition from other bidders in a similar position to us looking for suitable joint venture
partners with whom to partner in order to meet the pre-qualification requirements. If we are unable to partner
with other players, we may lose the opportunity to bid for, and therefore fail to increase or maintain its volume
of new construction contract orders or new projects. There can be no assurance that we can continue to
effectively compete with our competitors in the future, and failure to compete effectively may have an adverse
effect on our business, financial condition, cash flows and results of operations.
8. Delays in completion of our current and future projects and cost overrun could have adverse effect
on our business prospects and results of operations. We have faced delays in completion of certain of our projects and are expected to face delays in completion for
certain of our projects which are under development. The scheduled completion targets for our projects are
estimates and are subject to delays as a result of, among other things, unforeseen engineering problems,
force majeure events, issues arising out of right of way, unavailability of financing, unanticipated cost
increases or changes in scope and inability in obtaining certain property rights or government
approvals. Typically, our projects are subject to specific completion schedule requirements. We also
provide performance guarantees to our clients which require us to complete projects within a specified
time frame.
Failure to adhere to contractually agreed timelines for reasons other than for force majeure events and
counter-party defaults could lead to forfeiture of security deposits, result in us requiring to pay liquidated
damages or our performance guarantees being invoked. There can be no assurance that our projects will be
completed in the time expected. We cannot assure you that all potential liabilities that may arise from delays or
that the damages, if any, that may be claimed from third parties for such delay, shall be adequate to cover any
loss of profits resulting from such delays.
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We have encountered delays and cost overrun in many of our projects. For instance,
Sr.No. Name of the Project Particulars
1. Delhi Metro Project
Contractual completion
date
October 15, 2014
Expected completion
date
April 30, 2016
Time overrun 18 Months
2. Bangalore Metro Project Contractual completion
date
June 30, 2012
Expected completion
date
July 31, 2016
Time overrun 49 months
in the aforesaid projects, there has been significat delays on account of delay in handing over of land and delay
in releasing drawings etc. Further, in the aforesaid project the actual cost overrun would be ascertained only
when the final bill (the final bill is raised in consultation with the project developer) is raised. In the absence of
the final bill, the Company is not in a position to ascertain cost overrun on the aforesaid projects. We cannot
assure you that similar delays will not occur in the future. Such delays could have adverse effects on our cash
flows, business, results of operations and financial condition.
9. A major portion of our assets have been charged under our financing arrangements. A default
under any of the financing arrangements may compel the bank to sell the asset to recover its loan, which may
lead to fewer assets available to us to avail further bank facilities, which may affect our financial
condition, cash flow and results of operations.
We maintain bank facilities and term loans with banks and other financial institutions to provide us with
general working capital and operational flexibility in connection with our business. We also receive funds
from banks and other financial institutions pursuant to infrastructure project specific loans.
In the event of a default by us on our financing agreements, our charged assets could be seized, leaving us with
fewer assets with which to operate our business, adversely affecting our business prospects. This could
also result in us having difficulty obtaining further working capital through borrowings from these or
other lenders given our lack of substantial additional security capable of being charged and affect financial
condition, cash flows and results of operations.
10. Part of our Company's business transactions are with government entities or agencies which present
particular risks.
During the Fiscal 2015, revenue generated from government agencies was Rs. 74,958.50 lacs representing
31.25% of the total turnover of the Company for Fiscal 2015, on standalone basis. This depicts that part of our
Company’s business is dependent on development projects undertaken by government entities or agencies.There
could be delays in projects with these authorities and institutions due to changes in government policies or
initiatives, changes in budgetary allocation or the insufficiency of funds on the part of the government or
government organizations. Our Company also faces the risk of non- payment or delay in the collection
of receivables from government owned or controlled entities and financial institutions. Our Company's
operations involve significant working capital requirements and a non-payment or delayed collection of
receivables could significantly adversely affect our Company's financial condition, liquidity and results of
operations.
Further the contracts awarded to us by government entities are based on standard forms and may contain terms
that favour the government entity. Government contracts generally also contain unilateral termination
provisions in favour of the government. The provisions generally state that the government has the right to
terminate the contract for convenience, without any reason, at any time after providing the company with
reasonable notice. In the event that one or more of our Company's material contracts is terminated, our
business and results of operations may be adversely affected.
13
In addition, documentary closure or completion of government contracts, including the release of
performance guarantees and final acceptance notices, generally takes a significant amount of time and is subject
to material delays, which also adversely affects our Company's financial condition and results of operations.
11. We are dependent on our suppliers for adequate and timely supply of key raw materials
at competitive rates and generally do not enter into any long term supply contracts with our suppliers.
Ifwe are unable to procure the requisite quantities of construction materials in time and at
commercially acceptable prices, the performance of its financial results and business prospects could be
adversely affected.
We purchase significant amount of raw materials, including steel, cement, admixture, aggregates, sand, binding
wires, bitumen etc. for its construction operations. Cost of material consumed in Fiscal 2015 was ` 85,926.48
lacs i.e. 34.60% of total sales. While we maintain relations with many different suppliers in order to avoid such
risks, the unavailability of such resources could materially disrupt our operations. In addition, the
unavailability and fluctuations in costs of raw materials could significantly affect our operating costs and
consequently reduce our profitability. Accordingly, we cannot assure you that we would be able to
procure raw materials in a timely manner and at competitive prices or that we will not be affected in the event
of any shortfall of supply, which may adversely affect our business. The contracts entered into by us with our
clients normally include clauses permitting us to recover the cost of escalations in the price of materials and
labour. However, such variation clauses normally link the additional amounts which we can recover to levels of
increase in specified published indices. We cannot assure you that the additional amounts which we should
recover from clients in respect of the increased cost of materials will be the full amount of such
increased costs borne by us. Although we normally provide a margin in our estimates for increases in
labour and material costs and other contingencies, significant cost overruns may still occur, and could
adversely affect our business, results of operations and profitability.
12. Changes in the scope of work may result in disputes, which could have a material and
adverse impact on the profits from that project.
In certain cases, we may be required to perform additional work on a project that is beyond the stated scope of
the contract. We may not receive adequate remuneration for the same, or payments in respect of the same may
be delayed or may not be commensurate with the quantum of work performed, which may have a material
adverse effect on our profits. Further, in certain contracts we may be required to execute modified work
order as directed by the client which may not have been agreed upon at the time of execution of the contract.
This process may result in disputes and may result in delayed or inadequate payments. This could have
an adverse effect on our profits.
13. We have high working capital requirements. If we are unable to generate sufficient cash flows to
allow us to make required payments on our debt or fund working capital requirements, there may be an
adverse effect on our results of operations.
Our Company has high working capital requirements. In many cases, significant amounts of working capital are
required to finance the purchase of materials and the performance of engineering, construction and other work
on projects before payments are received from clients.
Our working capital requirements may increase if, under certain contracts, payment terms do not include
advance payments or such contracts have payment schedules that shift payments toward the end of a
project or otherwise increase our working capital burden. . We have in the past experienced delays in
receipt of our dues from few clients; all of these factors may result, or have resulted, in increase in our
working capital needs.
It is customary in the industry in which we operate to provide Bank guarantee in favour of clients to secure
various obligations under the contract. These may extend, wholly or partly, during the contract period and even
after the date of completion of the project for an additional period of upto 6 to 12 months. The clients may
invoke such Bank guarantees if the contractual obligations are not met which may have a material adverse effect
on our business, results, operations and financial conditions.This may also effect company’s ability to get fresh
working capital in the business.
14
14. Failure to adhere to agreed contractual conditions with clients could adversely affect our reputation
and/or expose us to financial liabilities.
Our contracts are subject to specific requirements on programme, quality and other conditions with appropriate
contractual remedies for non-performance of our obligations. Any default of these obligations unless accepted
by the client/s could cause damage to our reputation and / or affect the financial outcomes on the affected
contract/s. In the past three years some of our clients, have deducted certain amounts from our final bill.
15. Certain of our working capital facilities are under renewal.
Our working capital facilities gets renewed every year and as on date certain of our working capital facilities are
under renewal. We have availed working capital facilities from a consortium of eight banks. Of the aforesaid
working capital facilities, we have received renewed sanction letters from four banks and are in the process of
obtaining renewal from the remaining four banks. Though we have initiated the process for renewal of such
facilities we cannot assure you by when and at what terms, the working capital facilities will get renewed, at all.
In case any of our banks do not renew the facilities it may adversely affect our Objects of the Issue, our cash
flows which may in turn affect our business, results of operations and profitability.
16. We have in the past not been, and continue to not be, compliant with certain covenants, in relation to
certain loan agreements, which have resulted and potentially could result in an event of default under the
respective loan agreements and cross-defaults under other instruments, thereby accelerating our obligations
under our debt facilities.
We enter into loan agreements, with various lenders for the financing of our projects and other purposes, which
require us to comply with certain financial as well as non-financial covenants, during the currency of the
respective loans. In respect of most of these loan agreements, in case of an event of default, the lenders have the
right to, inter alia, declare all the amounts outstanding, including interest, with respect to that loan immediately
due and payable (subject to the expiry of any applicable cure periods), exercise their rights pursuant to cross-
default and cross-acceleration provisions under such loan agreements, guarantees or instruments and enforce
their security created in their favour.
Any acceleration, cross acceleration, enforcement of security and / or guarantee, trigger of a cross-default or
declaration of a cross-default under the financing agreements entered into by our Company or any of our
Subsidiaries or Joint Ventures may have a material adverse effect on our business, prospects, cash flows and
financial condition.
As of March 31, 2015, as per the consolidated Financial Statement and standalone Financial Statements, our
borrowings (aggregate of long-term borrowings, short-term borrowings and current maturities of long-term
borrowings) were ` 2,00,474.93 lacs and ` 66,881.89 lacs respectively.
There have been, in the recent past, certain breaches of financial covenants under the loan agreements of our
Company, which may have resulted in an event of default under the financing agreements and a cross-default
under other loan agreements. Additionally, we are currently not in compliance with some of the financial
covenants under the loan agreements of our Company which in some cases has resulted in, and may result in, a
notice of default and acceleration being served on us. Such actions by the lender shall and may continue to in the
future cause a material adverse effect on our business, prospects and financial condition.
There is no assurance that we shall not be in breach of any covenants in the future under our current or future
financing agreements and that such breach will not cause a material adverse effect on our business, prospects
and financial condition or cause the cessation of our business as a going concern. While the lenders may not
have declared an event of default under any of our financing agreements where there have been defaults
(irrespective of their knowledge of such defaults) and though we continue to service our debts on their
respective due dates, we cannot assure you that the lenders will not seek to enforce their rights in respect of any
past, present or future breaches or that we will be able to obtain any waivers from any or all lenders. In the
absence of waivers for any non-compliance of the covenants, irrespective of payments of any penalties by us,
we may continue to be in default of the covenants and our lenders have the right to accelerate payment of all
amounts outstanding under the relevant loan agreements and declare such amounts immediately due and payable
together with accrued and unpaid interest. Any such action by our lenders to declare us in default may trigger
15
cross-default clauses under other loan agreements, including loan agreements of our Company, and would have
a material adverse effect on our business, prospects, cashflows, financial condition and results of operations.
Further, none of the accounts of our Subsidiaries have been declared as non performing assets or defaulters by
any bank or financial instiutions. However one of the account of our Company ie. our account with State bank
of India, Ahmedabad was declared NPA in June 2015. The account was declared to be a NPA owing to a
technical matter and not on account of payment default by our Company.
17. Our expansion into new geographic areas, including expanding our operations and making new
investments overseas, poses various risks associated with changes in political, economic, regulatory, law
amongst various other risks associated with doing business.
Our business (in relation to our international projects) is subject to risks and challenges generally associated
with international operations and investments. These risks and challenges include risks with respect to interest
rate and foreign currency fluctuations, different tax and regulatory environments (particularly with respect to the
provision of financial services and direct investment), changes in social, political and economic conditions, the
need to recruit personnel combining product skills and local market knowledge, obtaining the necessary
clearances and approvals to set up business and competing with established players in these regions and cost
structures in international markets, including those in which we and the companies in which we have
investments operate, that are significantly different from those that we have experienced in India. Additionally,
we may evaluate international expansion opportunities through capital investment in other projects.
We may be unsuccessful in developing and implementing policies and strategies that will be effective in
managing these risks. Our failure to manage these risks successfully could adversely affect our business,
operating results and financial condition. Furthermore, we may face competition in other countries from
companies that have more experience with operations in such countries or with international operations
generally. If we are unable to successfully develop or manage our international operations, it may limit our
ability to grow our international business.We may not be able to successfully manage our expansion outside
India owing to various risks, which could have a material adverse effect on our business, prospects, financial
condition and results of operations.
18. We are exposed to various risks at our sites all over India which could result in additional liabilities
and/or costs to us.
Our operations are subject to several hazards such as risk of equipment failure, work accidents that may cause
injury and loss of life, severe damage to and /or destruction of property and equipment and / or environmental
damage.
During the provision of our engineering and construction services, we undertake liabilities relating to design,
engineering, materials, workmanship, construction and maintenance during defect liability period etc. Claims
from the client could arise for a perceived default of our obligations. We provide our competitive tenders after
considering reasonable and assessed costs towards performance of contractual obligations including where
considered necessary and where mandated, specific insurance coverage. In case of any failure by us in the actual
execution of these obligations, we would be liable to claims alleging default of the obligation.
Where the risk mitigation through appropriate insurance coverage or provision of assessed costs for complying
with its obligations is found insufficient, we may be called upon to compensate the claimant/s for such costs
which were not assessed or insured against or provided for and could affect the financial condition and have a
material adverse effect on our business.
19. Our Company has witnessed negative cash flows from investing activities and financing activities on
a standalone basis. Any negative cash flows in the future could adversely affect our results of operations and
financial condition.
Our cash flows for the Fiscal Year ending March 31, 2015 and March 31, 2014 on a standalone basis are
summarised below:
(Amount in ` lacs)
Particulars Fiscal 2015 Fiscal 2014
Net cash flow from operating activities (7,166.42) 12,914.80
Net cash flow from investing activities (6,790.52) (10,469.86)
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Particulars Fiscal 2015 Fiscal 2014
Net cash flow from financing activities 13,214.13 (2,673.85)
Our cash flows for the Fiscal Year ending March 31, 2015 and March 31, 2014 on a consolidated basis are
summarised below:
(Amount in ` lacs)
Particulars Fiscal 2015 Fiscal 2014
Net cash flow from operating activities 7,308.14 9,182.39
Net cash flow from investing activities (37,957.26) (66,143.54)
Net cash flow from financing activities 30,178.39 56,102.54
If we do not maintain positive cash flow, we cannot assure you that we will be able to sustain our growth or
achieve profitability in future periods.
20. We deploy a large workforce at our project sites and staff at offices. Demands and / or group activity
by any of these groups including work stoppages and other forms of industrial action could result in delays
and additional costs affecting our operating results
As of November 30, 2015, we employed a staff of approximately 2,331 employees. In addition, we have a large
number of site based staff, piece rate and temporary contract labour on our project sites.
We have not experienced any major disruption in our work in the past, due to size of our workforce. However,
there can be no assurance that we will not experience future major disruptions to our operations due to disputes
or other problems with our work force, which may adversely affect our business and results of operations. The
number of contract labourers varies from time to time based on the nature and extent of work contracted. We
also enter into contracts with independent contractors to complete specified assignments. Contract labourers
engaged at the project sites are governed by minimum wages regulations that are fixed by local government
authorities. Any upward revision of wages required by such governments to be paid to such contract labourers,
or offer of permanent employment or the unavailability of the required number of contract labourers, may
adversely affect our business and results of operations.
21. Our road BOOT projects under development or implementation require a medium to long gestation
period and ample capital outlay before we realise any benefits or returns on investments. We could encounter
problems that impair our ability to generate revenue from our operating projects or substantially increase the
costs and the time required to develop such projects, as well as our ability to complete and generate revenue
from, our projects under development. We may not be able to recover our intended returns from our
investments due to various problems that may be encountered by such projects.
Our road BOOT projects typically have a long gestation period and require substantial capital infusion at
periodic intervals before their completion and it may take months or even years before positive cash flows can
be generated, if at all. The development, implementation, conversion, relocation and operation of infrastructure
projects involves various risks, including, among others, land acquisition risk, regulatory risk, construction risk,
time delays in completion of projects, escalations in estimated project cost, financing risk, raw material risk,
commodities price risk and the risk that these projects may ultimately prove to be unprofitable.
We may be adversely affected if the completion or commencement of operation of our projects under
development or implementation or the conversion or relocation of existing projects is delayed due to any of the
following (a) the contractors hired may not be able to complete the construction of projects on time, within
budget or to the specifications and standards set out in contracts with them; (b)engineering problems, including
defective plans and specifications; (c) shortages of, and price increases in, energy, materials, skilled and
unskilled labour, and inflation in key supply markets; (d) changes in laws and regulations, or in the
interpretation and enforcement of laws and regulations of such countries including India and Ethopia, among
others, applicable to projects under development; (e) weather interferences, fire, natural disasters or delays; (f)
geological, construction, excavation, regulatory and equipment problems with respect to operating projects and
projects under development; (g) drawings for the sites on which projects are expected to be developed may not
be accurate as these drawings are generally quite dated; we may not be able to obtain adequate working capital
or other financing to complete construction of and to commence operations of our projects; we may not be able
to recover the amounts invested in our or their projects if the assumptions contained in the feasibility studies for
these projects do not materialise; our roads customers may not use our toll roads in the expected quantities or at
17
all or may not pay in full or at all, governmental approvals and other approvals that are required for completion,
expansion or operation of our projects may be delayed or denied; environmental risk, including rehabilitation
and resettlement costs; and other unanticipated circumstances or cost increases. Any failure in the development,
financing, implementation or operation of any material new project or existing project by us or a company in
which we invest is likely to materially and adversely affect our business, prospects, financial condition and
results of operations.
22. Some of the trademarks that we use, are yet to be applied for registration in our name and we may,
consequently, be unable to defend any infringement of our intellectual property rights. Further, some of the
trademarks that we use belong to a third-party and may not be registered, or licensed to us or may be licensed
to us on term not favourable to us. We may be liable for infringement and/or passing off of intellectual
property.
We believe that one of the factors of our success is our brand and we use several trademarks in connection with
our business. While we are yet to file applications for registration of the logo under classes 19, and 36 in
terms of the provisions of the Trade Marks Act, 1999, the process of registration in India is time-consuming and
there can be no assurance that we will be granted the trademark, soon or at all. If we are unable to obtain the
requisite registration, intellectual property like or similar to ours may be used by others including our
competitors, thereby diluting our brand value and our goodwill. Further, the trade mark ‘Kalpataru’, that we use
belongs to a third-party and may not be registered, and not duly licensed to us. In addition, our ability to defend
any infringement of our intellectual property rights may be hampered by lack of registration since we will only
be able to initiate proceedings for passing-off, which could adversely affect our brand, our goodwill and
business prospects.
23. We have entered into and may in the future enter into related party transactions.
We have in the course of our business entered into, and will continue to enter into, transactions with related
parties. Our Company has entered into several related party transactions with our Promoter and our Subsidiaries,
including in relation to inter-corporate loans. For more information regarding our related party transactions, see
“Financial Information” beginning on page 72 of the Letter of Offer. We cannot assure you that we will receive
similar terms in our related party transactions in the future.
While we believe that all of our related party transactions are in compliance with applicable law, we cannot
assure you that we could not have achieved more favourable terms had such transactions been entered into with
unrelated parties. Further, the Companies Act, 2013 has brought into effect significant changes to the Indian
company law framework including specific compliance requirements such as obtaining prior approval from
audit committee, board of directors and shareholders for certain related party transactions. We cannot assure you
that such transactions, individually or in the aggregate, will not affect our reputation, business, results of
operations and financial condition.
24. The failure of a joint venture partner to perform its obligations could impose additional financial
and performance obligations resulting in reduced profits or, in some cases, significant losses from the joint
venture.
We had entered into a joint venture agreement and may enter into various joint ventures with construction
companies as part of our business. The success of these joint ventures depends on the satisfactory performance
by our joint venture partners and fulfilment of their obligations. If our joint venture partners fail to perform these
obligations satisfactorily, the joint venture may be unable to perform adequately or deliver its contracted
services. In this case, we may be required to make additional investments and/or provide additional services to
ensure adequate performance and delivery of the contracted services because we are subject to joint and several
liabilities as a member of the joint venture in a number of projects. These additional obligations could result in
reduced profits or, in some cases, losses for us. The inability of a joint venture partner to continue with a project
due to financial or legal difficulties could mean that we would bear increased and possibly sole responsibility for
the completion of the project and bear a concomitant increase in the financial risk of the project.The aforesaid
factors may adversely affect our business and results of operations.
25. On fixed-price, lump sum or item-rate contracts, we are exposed to increases in the cost of
construction materials, fuel, and equipment.
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Under fixed-price or lump sum contracts, we typically agree to a fixed price for providing civil construction for
the part of the project contracted to us.
Under these contracts, additional costs associated with cost increases in construction materials, fuel, equipment,
and materials are borne by us, unless these contracts contain price escalation clauses. Similarly, we bear the
additional cost associated with quantities of construction materials, fuel, equipment and materials exceeding
estimates and assumptions. The prices and supply of these construction materials depend on factors beyond our
control, including general economic conditions, competition, production levels, transportation costs and import
duties. Some of our construction contracts either contain limited or no price escalation clauses covering these
additional costs.
Under item-rate contracts, we agree to provide certain construction activities at a rate specified in the relevant
bill of quantity, or “BOQ”. The BOQ is an estimate of the quantity of activities involved and these quantities
may be varied by the parties during the course of the project. Although the additional costs associated with
actual quantities exceeding estimated quantities may not pass to our Company entirely, we however, bear the
risk associated with actual costs for construction activities exceeding the agreed upon rate, unless these item-rate
contracts contain price escalation clauses.
For fixed-price or lump sum or item-rate contracts, we may bear additional cost if actual expenses vary
substantially from the assumptions underlying its bid and forecasted budget for reasons related to the following:
unanticipated changes in engineering design of the project;
drawings and technical information provided by clients, and on which bids were based, are not accurate;
unforeseen design and engineering construction conditions, site and geological conditions, resulting in
delays and increased costs;
inability by the client to obtain requisite environmental and other approvals;
delays associated with the delivery of equipment and materials to the project site;
unanticipated increases in equipment costs;
delays caused by local and seasonal weather conditions; and
suppliers’ or sub-contractors’ failure to perform their obligations in a timely manner.
As fixed price or lump sum and item-rate contracts also tend to be fixed-time contracts, we bear the risk of
unanticipated delays other than for force majeure events.
Unanticipated costs or delays in performing part of a contract and/or unanticipated increases in the price of
construction materials, fuel, equipment, and materials can have a compounding effect by increasing costs of
performing other parts of the contract. There may also be a higher risk of delay created by the fact that
construction contracts are sometimes divided into multiple parts to be simultaneously performed by us and joint
venture partners.
These risks generally inherent to the construction industry may result in lower profits than originally estimated
and may result in reduced profitability or losses on our projects.
26. We depend on sub-contractors for timely and successful completion of certain parts of our projects
and failure on the part of our sub-contractors to perform their obligations in a timely manner or at all could
adversely affect our ability to complete projects in a timely manner at commercially viable terms.
We depend on sub-contractors for timely and successful completion of certain part of our projects and failure on
the part of our sub-contractors to perform their obligations in a timely manner or at all could adversely affect our
ability to complete projects in a timely manner at commercially viable terms or at all, which in turn could
subject us to time and cost overruns, defaults under the contracts for such projects and loss of revenue and
profitability.
We assign work to various subcontractors to assist us depending on the area, type, duration and size of our
projects. We attempt to ensure that the services performed by our subcontractors are of a high standard
as full responsibility to the customer for all construction projects rests with us (although the subcontractor is
responsible to us for its work). There is no assurance that the quality of work performed by such
subcontractors will always be of a sufficiently high standard. Further, the use of subcontractors exposes us to
various risks over which we may have little or no control, including the possibility that a subcontractor may fail
or otherwise become unable to perform or complete projects, or that projects may otherwise be delayed or
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defective.
Even when we sub-contract work, it remains responsible for the sub-contracted work which means clients still
have recourse to our Company for actions, omissions and defects by sub-contractors. In some cases, our
Company may not receive guarantees or indemnities from sub-contractors as to timely completion, cost
overruns, or additional liabilities which means that it assumes the risk of delayed or reduced payments,
liquidated damages or penalty amounts, or contract termination by the client. Our Company also assumes
liability for defects in connection with any work done by sub-contractors. Hence, any failure on the part of our
sub-contractors to perform their obligations in a timely manner or at all could adversely affect our operations,
financial condition and cash flows.
27. We depend on machinery and equipment to implement our projects. We order these machinery and
equipment from various parts of the world. Any manufacturing defect or break down or poor maintenance
systems of the machinery may cause strain on our machinery and lead to delays in implementation of our
projects.
We depend on machinery and equipment to implement our projects. We order these machinery and equipment
from various parts of the world. Any manufacturing defect or break down or poor maintenance systems of the
machinery may cause strain on our machinery and lead to delays in implementation of our projects and loss of
performance. In addition, technology advancements could result in lower future utilization of equipment, which
may have an adverse impact on our business, operations and profitability.
28. During the tenure of the project, the creditworthiness of our clients may weaken, which may affect
their paying capacity and may lead to delays in our payments.
The key risk associated with construction companies, such as ours, is the creditworthiness and the
paying capacity of the clients. If the client does not have adequate funds, it could delay our projects or even
lead to cancellation of the project. Moreover, we may or may not get any compensation if payments due to us
are delayed, which may have an adverse effect on our liquidity.
29. Demand for our services is dependent on growth in infrastructure and general economic conditions.
Demand for our services is largely dependent on general economic conditions, growth in infrastructure and
economic cycle. Our business is also directly affected by changes in government spending and capital
expenditures by our clients. Any change or downturn that leads to decreased spending on construction projects
including privately funded infrastructure projects, could adversely affect our business and our results of
operations.
30. Revenue from toll collections for our toll based projects are dependent on various factors, including,
actual traffic volume as compared to our forecasted traffic volumes, traffic saturation and toll leakage.
When preparing the tender for a toll based project, particularly to determine the bid undertaking for such toll
based project or contract, we forecast the traffic volume for the road in order to arrive at our expected revenue
over the concession period or the contract period, as applicable. In such instances, if the actual traffic volume is
significantly less than the forecasted traffic volume, the revenue generated from the toll based project may be
lower than the anticipated revenue. We forecast the traffic volume for toll based projects based on the data
provided by external agencies engaged by us such as traffic consultants and in-house team of professionals. The
forecasting of traffic volumes is based on various assumptions, and we cannot assure you that such forecasts
will be accurate. While most of our toll-based concession agreements provide for an extension of the concession
period if the actual traffic volumes are significantly lower than the target traffic (as per the concession
agreement) projected for the project, we cannot assure you that the concession period will be actually extended.
Toll roads that are part of projects operated by us may experience high levels of traffic and congestion at certain
times of the day or days of the week. Although we may consider possible solutions and take appropriate steps to
ease traffic flow and reduce congestion on such roads, there can be no guarantee that the saturation problems
will be resolved under conditions that are economically satisfactory to us. This could lead to user dissatisfaction
and could potentially reduce the traffic volume which may adversely affect our results of operations, cash flows,
business and financial condition.
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Further, our collection of toll is primarily dependent on the integrity of toll collection systems, our internal
control and checks and internal audit systems and willingness to pay toll fees. While we have in place an
internal audit and an integrated toll collection system, the level of revenues derived from collection of tolls may
be reduced by leakage through toll evasion, theft, fraud or technical defaults in our toll systems or forced
violations by users of our toll roads. If toll collection is not properly monitored, leakage may reduce our toll
revenue. Further, toll collection errors may amount to a loss of revenue as there is an inherent risk of under-
collection of toll fees given that most users of toll roads pay in cash. Any significant failure by us to control
leakage in toll collection systems could have an adverse effect on our results of operations, cash flows, business
and financial condition.
31. Delays associated with collection of receivables from clients may adversely affect our business and
results of operations.
We have experienced delays in the collection of receivables from our clients due to various reasons. There are
routine delays associated with collection of receivables from government entities and other clients. As of March
31, 2015 the trade receivables stands, on a standalone basis and consolidated basis, at ` 41,248.56 lacs and ` 40,671.00 lacs respectively, out of which an amount of ` 7,247.99 lacs and ` 7,321.11 lacs respectively have
been outstanding for more than six months.
We may require additional working capital if we are unable to recover our claims on time due to disagreements
or disputes with clients leading to protracted contractual dispute resolution processes including arbitration and
court proceedings which could result in substantial delays in receipt of corresponding payments where work
may have been performed and/or costs incurred. These may result in increase in the amount of our receivables
and short-term borrowings.
The construction business involves significant working capital requirements and delay in collection of
receivables could adversely affect our liquidity and financial results.
32. Inability to handle expansion of our business operations or the delayed provision of required
resources by us for such expansion could impact our operations and adversely affect our financial results.
In order to participate in the growth in our industry and consequently expand our operations, we need to
augment our organisation, systems and controls commensurate with the size and nature of business. This growth
may pose significant challenges and demands on our management, financial and other resources. Our ability to
successfully implement our business plan would depend on adequate systems and resources and we will need to
continuously develop and improve our financial, internal accounting and management controls, reporting
systems and procedures to grow and expand our business.
Inability of our Company to provide these key resources in a timely manner would seriously impact our
operations, growth and financial results.
33. Risks associated with execution of large and complex engineering and construction contracts that
may be secured by us.
The current infrastructure market is evolving towards large and complex projects with significant risks being
passed on to the contractor. We provide competitive bids for large infrastructure projects after assessment of
costs and associated risks on these complex projects. However, as a result of various conditions prevailing
during the commencement and completion of these projects the estimated financial outcomes may not
materialise which may affect our financial performance.
34. Given the long-term nature of infrastructure development projects, we face development and
implementation/completion risk.
A key element of our strategy is to extend our business to infrastructure development. Typically, infrastructure
development projects involve agreements that are long-term in nature.
The implementation of infrastructure projects involves substantial capital expenditure and other risks
associated with major projects, such as cost overruns, delays in implementation and damages payable
therefor, technical and economic viability and changes in market conditions, fixed capital commitments
over a long period of time, any of which may have a material adverse effect on the results of operations and
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profitability of our Company.
Further although our Company builds contingencies into our expected total project costs, there can be no
certainty that such contingencies will be sufficient to fund any such costs. Any project delays or cost overruns
on our projects could have a material adverse effect on the results of operations of our Company. In addition,
any project delays or cost overruns could lead to an early termination of the relevant project contract by our
clients.
35. We execute construction projects through unincorporated joint ventures.
Company also executes projects through unincorporated joint ventures with another company. These
unincorporated joint ventures are not separate legal entities and the liabilities incurred by such unincorporated
joint ventures would be shared jointly and severally by the members of such joint venture entities. While cross
indemnification is usually available between the joint venture members, we could be exposed to liabilities
arising out of defaults by our joint venture member.
36. The nature of our construction business exposes us to liability claims and contract disputes.
We are involved in large projects where default or inadequacies in design, construction or systems failures can
result in injury or damage to third parties. We could face claims for damages if a project suffers from defects in
the quality of our design, engineering or construction. While we maintain insurance in accordance with industry
standards, there can be no assurance that such insurance will be sufficient to cover liabilities resulting from
claims. Any liability in excess of our insurance limits or any loss arising out of uninsured risks could result in
additional costs which could affect our financial results. Further, in the event a client raises a dispute regarding
our performance, it may delay or withhold our payments which, in turn, would affect our financial results.
37. Our operations are sensitive to weather conditions and adverse weather conditions could affect our
business and results of operations
We operate at multiple sites all over the country where we are exposed to risks arising from force majeure
events including, among others, rain, floods, earthquake, landslides and other natural calamities. These could
cause reduced productivity, cessation, evacuation and other hazards and to the extent the losses are not
recoverable from the client under the respective contract and/or our insurance policies, they may result in
additional expenses on the affected projects and may adversely affect our financial condition and results of
operation.
38. Our contracts and projects carry risks that may not be fully covered by insurance policies to cover
our economic losses.
Our projects carry a variety of risks that could be due to technical, legal, financial and other reasons, which may
materialise during the execution of the project. Not all of the risks may be insurable or possible to insure on
commercially reasonable terms. Although for most of our Contracts, our Company has insurances that are
customary for construction projects in India, the insurances, however, may not provide adequate coverage in
certain circumstances such as change in value of contract(s) and is subject to certain deductibles, exclusions and
limits on coverage. Should an uninsured loss or a loss in excess of insured limits occur, our financial results
could be affected.
39. Inability to attract, recruit and retain skilled personnel could adversely affect our business and
results of operations.
In the construction business, we are dependent on our key management personnel, including skilled project
management personnel for setting our current operations and sustainable business growth, which are crucial to
our success and business strategy. Similarly, we are dependent on the availability of a large pool of contract
labour. Our ability to meet current and future business growth opportunities depends on our ability to attract,
recruit and retain experienced, talented and skilled professionals as well as the availability of a sufficient pool of
contract labour to execute construction contracts. Due to the current limited pool of skilled personnel,
competition for senior management, functional specialists including commercial and finance professionals, and
engineers in our industry is intense. We may also need to increase our pay structures and other employee benefit
schemes to attract and retain such personnel, which could affect our profit margins. Further, there can be no
assurance that increased salaries will result in a lower rate of attrition. The loss of the services of our directors,
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senior management or other key personnel or our inability to recruit or train a sufficient number of experienced
personnel or our inability to manage the attrition levels in different employee categories may have an adverse
effect on our operations, financial results and business prospects.
40. Our business depends on our ability to successfully bid for or acquire projects. Our inability to
successfully bid for or acquire projects could have an adverse effect on the growth of our business.
As part of our growth strategy, we intend to acquire projects from third parties and bid for projects on an
individual basis or with joint venture partners. Such future acquisitions of projects will depend on various
factors such as: (i) our ability to identify projects on a cost-effective basis, (ii) our ability to integrate acquired
operations into the business, (iii) our ability to outbid our competitors and (iv) other legal, tax and accounting
issues. Further, such acquisitions may require consents from the lenders under the existing financing agreements
and the concessioning authority. We cannot assure you that we will be able to achieve the strategic purpose of
such acquisitions or operational integration or an acceptable return on such investments or successfully bid for
such projects, which may adversely affect our cash flows, business, results of operations and financial condition.
41. We could be adversely affected if we fail to keep pace with technical and technological developments
in the construction industry.
The construction industry is now venturing into larger and more complex projects with major international
companies seeking to enter into the Indian market. Arising from the nature of projects and international
competition, the requirement of technology, operating processes as well as compression of completion schedules
would require us to continuously anticipate and keep pace with these changes. While we have integrated
management systems in place including continuous improvement processes, our inability to continuously
improve on our operating competencies could erode our efficiencies and adversely affect our growth and results
from operation.
42. We recognise revenue based on the “Percentage of Completion Method” of accounting on the basis
of the stage of completion and its revenues may fluctuate significantly from period to period.
Our Company recognises revenue generated from its construction contracts on the “Percentage of Completion
Method” as per the applicable accounting standard. The stage of completion of a contract is determined by the
proportion that contract costs incurred for work performed upto the reporting date bear to the estimated total
contract costs. Percentage of completion is determined on the basis of cost incurred. Contractual liquidated
damages, payable for delays in completion of contract work or for other causes, are accounted for as costs when
such delays and causes are attributable to the Company or when deducted by the client.
In the event of any change in law or Indian GAAP that requires a change in the method of revenue recognition,
our Company’s financial results may be adversely affected for the time being.
43. Activities in our projects can be dangerous and can cause injury to people or property in certain
circumstances. This could subject us to significant disruptions in our business and to legal and regulatory
action, which could adversely affect our business, financial condition and results of operations.
Our business requires our employees and contractors to work under potentially dangerous circumstances, with
flammable and explosive materials. Despite compliance with requisite safety requirements and standards, our
power segment's operations are subject to hazards associated with handling of such dangerous materials. If
improperly handled or subjected to unsuitable conditions, these materials could hurt our employees, contract
labourers or other persons, cause damage to our properties and properties of others and harm the environment.
Due to the nature of these materials, we may be liable for certain costs related to hazardous materials,
includingcosts for health related claims, or removal or treatment of such substances, including claims and
litigation from our current or former employees for injuries arising from occupational exposure to materials or
other hazards at our power plants. This could subject us to significant disruption in our business and to legal and
regulatory actions, which could adversely affect our business, financial condition and results of operations.
We may also be liable for certain costs related to hazardous materials, including costs for health related claims,
or removal or treatment of such substances, including claims and litigation from our current or former
employees for injuries arising from exposure to materials or other hazards at our projects. This could subject us
to significant disruption in our business and result in legal and regulatory actions, which could adversely affect
our business, financial condition, cash flows and results of operations.
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44. We depend on the expertise of our senior management and skilled employees; our results of
operations may be adversely affected by the departure of our senior management and experienced employees.
We are dependent on our directors and senior management for setting our strategic direction and managing our
business, which are crucial to our success. Our continued success also depends upon our ability to attract and
retain a large group of experienced professionals and staff. The loss of the services of our senior management or
our inability to recruit, train or retain a sufficient number of experienced personnel could have a material
adverse effect on our operations and profitability. Our ability to retain experienced staff members as well as
senior management will in part depend on us having in place appropriate staff remuneration and incentive
schemes. We cannot be sure that the remuneration and incentive schemes we have in place will be sufficient to
retain the services of our senior management and skilled employees.
45. The deployment of funds for the Objects of the Issue is at the discretion of our Board. Pending
utilisation for the purposes described therein, our Company may temporarily invest funds from the Net
Proceeds.
We intend to use the Net Proceeds of the Issue for the purposes described in the section “Objects of the Issue”
on page 44 of the Letter of Offer. Subject to this section, our management will have broad discretion to use the
Net Proceeds. The funding plans are in accordance with our management’s own estimates and have not been
appraised by any bank / financial institution. Our Company may have to revise its management estimates from
time to time and consequently its requirements may change.
Pending utilisation of the Net Proceeds, our management will have significant flexibility in temporarily
investing the Net Proceeds of the Issue. Accordingly, we cannot assure you that the use of the Net Proceeds for
purposes identified by our management will result in any returns.
46. Our Promoter have majority control over the Company before and after the Issue, which will allow
them to determine the outcome of matters submitted to shareholders for approval.
We are controlled by our Promoter who, as at September 30, 2015, beneficially owns 67.19% of our paid – up
equity capital of the Company. As a result of their interest, our Promoter, as a shareholder, has the ability to
exert influence over our business and certain actions requiring shareholders’ approval, including, but not limited
to, the election of directors, the declaration of dividends and others decisions. The interests of our Promoter
could conflict with the interests of our other shareholders. Such a concentration of ownership may also have the
effect of delaying, preventing or deterring a change in control of the Company. In addition, our Promoter will
continue to have the ability to cause us to take actions that are not in, or may conflict with, our interests or the
interests of some or all of our creditors or minority shareholders, and we cannot assure you that such actions will
not have an adverse effect on our future financial performance or the price of our Equity Shares.
EXTERNAL RISK FACTORS
1. There could be political, economic or other factors that are beyond our control but may have a
material adverse impact on our business and results of operations should they materialize.
The following external risks may have a material adverse impact on our business and results of operations
should any of them materialize:
Political instability, a change in the Government or a change in the economic and deregulation policies
could adversely affect economic conditions in India in general and our business in particular;
A slowdown in economic growth in India could adversely affect our business and results of operations.
The growth of our business and our performance is linked to the performance of the overall Indian
economy. We are also impacted by consumer spending levels and businesses such as ours would be
particularly affected should Indian consumers in our target segment have reduced access to disposable
income;
Civil unrest, acts of violence, terrorist attacks, regional conflicts or situations or war involving India or
other countries could materially and adversely affect the financial markets which could impact our
24
business. Such incidents could impact economic growth or create a perception that investment in Indian
companies involves a higher degree in risk which could reduce the value of our Equity Shares;
Natural disasters in India may disrupt or adversely affect the Indian economy, the health of which our
business depends on;
Any downgrading of India's sovereign rating by international credit rating agencies may negatively
impact our business and access to capital. In such event, our ability to grow our business and operate
profitably would be severely constrained;
Instances of corruption in India have the potential to discourage investors and derail the growth
prospects of the Indian economy. Corruption creates economic and regulatory uncertainty and could
have an adverse effect on our business, profitability and results of operations; and
The Indian economy has had sustained periods of high inflation. Should inflation continue to increase
sharply, our profitability and results of operations may be adversely impacted. High rates of inflation in
India could increase our employee costs, decrease the disposable income available to our customers and
decrease our operating margins, which could have an adverse effect on our profitability and results of
operations.
Change in Central govt./ State govt. policies might sometimes prove adverse to tolling income.
2. Our flexibility in managing our operations is limited by the regulatory environment in which we
operate.
The infrastructure sector in India, particularly in relation to maritime, road, and port industries, is highly
regulated. Our businesses are regulated by various authorities and state governments, including the Ministry of
Shipping, Road Transport and Highways, the NHAI, state governments and the GoI.
To conduct our infrastructure development business, we must obtain various licences, permits and approvals.
Even when we obtain the required licences, permits and approvals, our operations are subject to continued
review and the governing regulations and their implementation are subject to change. We cannot assure that we
will be able to obtain and comply with all changes in the governing regulations or the methods of
implementation will not occur. If we fail to comply with all applicable regulations or if the regulations
governing our infrastructure development business or their implementation change, we may incur increased
costs or be subject to penalties, which could disrupt their operations and adversely affect our financial results
and business prospects.
The regulatory framework, which consists of regulations and directives issued by government entities, has
changed significantly in recent years and their impact and ramifications are still unclear. We expect that certain
additional reforms, including change of the current regulatory bodies and existing legal framework, will take
place in the next few years.
Further we are subject to the corporate, taxation and other laws in effect in India which require
continued monitoring and compliances. The introduction of additional government control or newly
implemented laws and regulations and our ability to make corresponding adjustments, may result in a
material adverse effect on our business, results of operations and financial condition and our future expansion
plans in India. In particular, decisions taken by regulators concerning economic policies or goals that are
inconsistent with our interests, could adversely affect our results of operations. While we will take adequate
measures, we cannot assure you that we will be able to timely adapt to new laws, regulations or policies that
may come into effect from time to time with respect to the infrastructure projects specifically and
regulatory regime in general. These laws and regulations and the way in which they are implemented and
enforced may change from time to time and there can be no assurance that future legislative or
regulatory changes will not have an adverse effect on our business, results of operations, financial condition and
cash flows.
3. Public companies in India, including our Company, may be required to prepare financial statements
under IFRS or IndAS (a variation of IFRS). The transition to IFRS or IndAS in India is very recent and still
unclear and our Company may be negatively affected by such transition.
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The Company currently prepares its annual and interim financial statements under Indian GAAP. Public
companies in India, including the Company, may be required to prepare annual and interim financial statements
under Indian Accounting Standard 101 “First-time Adoption of Indian Accounting Standards (“IndAS”). On
February 16, 2015, the Ministry of Corporate Affairs, Government of India (“MCA”) announced the revised
roadmap for the implementation of IndAS (on a voluntary as well as mandatory basis) for companies other than
banking companies, insurance companies and non-banking finance companies through a press release (“Press
Release”).
The Press Release specifies that IndAS will be required to be implemented on a mandatory basis by companies
whose securities are either listed or proposed to list, on any stock exchange in India or outside India, based on
their respective net worth as set out below:
Sr. No. Net Worth First Period of Reporting
1. ` 50,000 lacs or more FY commencing on or after April 1, 2016
2. less than ` 50,000 lacs FY commencing on or after April 1, 2017
In addition, any holding, subsidiary, joint venture or associate companies of the companies specified above shall
also comply with such requirements from the respective periods specified above.
There is not yet a significant body of established practice on which to draw informing judgments regarding its
implementation and application. Additionally, IndAS differs in certain respects from IFRS and therefore
financial statements prepared under IndAS may be substantially different from financial statements prepared
under IFRS. There can be no assurance that the Company’s financial condition, results of operations, cash flow
or changes in shareholders’ equity will not be presented differently under IndAS than under Indian GAAP or
IFRS. When our Company adopts IndAS reporting, it may encounter difficulties in the ongoing process of
implementing and enhancing its management information systems. There can be no assurance that the adoption
of IndAS by our Company will not adversely affect its results of operations or financial condition. Any failure to
successfully adopt IndAS in accordance with the prescribed timelines may have an adverse effect on the
financial position and results of operations of our Company.
4. Investors may not be able to enforce a judgment of a foreign court against us.
The enforcement by investors in the Equity Shares of civil liabilities, including the ability to affect service of
process and to enforce judgments obtained in courts outside of India may be affected adversely by the fact that
we are incorporated under the laws of the Republic of India and almost all of our executive officers and
directors reside in India. Nearly all of our assets and the assets of our executive officers and directors are also
located in India. As a result, it may be difficult to enforce the service of process upon us and any of these
persons outside of India or to enforce outside of India, judgments obtained against us and these persons in courts
outside of India.
5. Terrorist attacks, civil unrest and other acts of violence or war involving India and other countries
could adversely affect our business and the Indian financial markets.
Any major hostilities involving India or other acts of violence, including civil unrest or similar events that are
beyond our control, could have a material adverse effect on India’s economy and our business and may
adversely affect the Indian stock markets where our Equity Shares will trade as well the global equity markets
generally. Such acts could negatively impact business sentiment as well as trade between countries, which could
adversely affect our Bank’s business and profitability. Our insurance policies for assets cover, among other
things, terrorism, fire and earthquakes. However, our insurance policies may not be adequate to cover the loss
arising from these events, which could adversely affect our results of operations and financial condition.
India has also witnessed civil disturbances in recent years and it is possible that future civil unrest as well as
other adverse social, economic and political events in India could have an adverse impact on us. Regional or
international hostilities, terrorist attacks or other acts of violence of war could have a significant adverse impact
on international or Indian financial markets or economic conditions or on Government policy. Such incidents
could also create a greater perception that investment in Indian companies involves a higher degree of risk and
could have an adverse impact on our business and the price of the Equity Shares.
6. You may be subject to Indian taxes arising out of capital gains. Any gain realised on the sale of
equity shares held for more than 12 months to an Indian resident, which are sold other than on a recognised
26
stock exchange and as result of which no Securities Transaction Tax (STT) has been paid, will be subject to
capital gains tax in India.
Under current Indian tax laws and regulations, capital gains arising from the sale of shares in an Indian company
are generally taxable in India. Any gain realised on the sale of listed equity shares on a stock exchange held for
more than 12 months will not be subject to capital gains tax in India if the STT has been paid on the transaction.
The STT will be levied on and collected by a domestic stock exchange on which equity shares are sold. Any
gain realised on the sale of equity shares held for more than 12 months to an Indian resident, which are sold
other than on a recognised stock exchange and as result of which no STT has been paid, will be subject to
capital gains tax in India. Further, any gain realised on the sale of listed equity shares held for a period of 12
months or less will be subject to capital gains tax in India.
Capital gains arising from the sale of the Equity Shares will be exempt from tax in India in cases where such
exemption is provided under the tax treaty between India and the country of which the seller is a resident.
Generally, Indian tax treaties do not limit India’s ability to impose tax on capital gains. As a result, residents of
certain countries may be liable for tax in India, as well as in their own jurisdictions on gain upon a sale of the
Equity Shares.
7. Financial instability in other countries could disrupt our business and cause the price of our Equity
Shares to decrease
The Indian market and the Indian economy are, to a certain extent, influenced by economic and market
conditions in other countries, particularly market conditions in the United States and Europe. Although,
financial turmoil elsewhere in the world in past years has had limited impact on the Indian economy, investors
should be aware that there is a recent history of financial crises and boom-bust cycles in multiple markets in
both the emerging and developed economies which leads to risks for all financial institutions, including us.
Although economic conditions are different in each country, investors’ reactions to developments in one country
can have adverse effects on the securities of companies in other countries, including India. A loss of investor
confidence in the financial systems of India or other markets may cause volatility in the Indian financial markets
and indirectly, in the Indian economy in general. This could negatively impact the Indian economy, including
the movement of exchange rates, interest rates and flow of funds in India. Any significant financial disruption
could have an adverse effect on our business, future financial condition and the price of our Equity Shares.
Although the recent financial crisis has had a limited direct impact on us, we remain subject to the risks posed
by the indirect impact of the global credit crisis on the economy, some of which cannot be anticipated and the
vast majority of which are not in our control. We also remain subject to counterparty risk to financial institutions
that fail or are otherwise unable to meet their obligations to us.
8. A slowdown in economic growth in India and instability in Indian financial markets could
materially and adversely affect our results of operations and financial condition.
Our performance and the quality and growth of our business are dependent on the health of the overall Indian
economy. There have been periods of slowdown in the economic growth of India during the 1990s as well in
Fiscal 2009. Any future slowdown in the Indian economy could thus harm our results of operations and
financial condition.
The Indian financial market and the Indian economy are influenced by economic and market conditions in other
countries, particularly in emerging markets. Financial turmoil in Asia, the United States, Europe and elsewhere
in the world in recent years has affected the Indian economy. Although economic conditions are different in
each country, investors' reactions to developments in one country can have adverse effects on the securities of
companies in other countries, including India. A loss in investor confidence in the financial systems of other
emerging markets may cause increased volatility in Indian financial markets and, indirectly, in the Indian
economy in general. Any worldwide financial instability, including further deterioration of credit conditions in
the U.S. and European market, could also have a negative impact on the Indian economy. Financial disruptions
may occur again and could harm our results of operations and financial condition.
9. The Issue Price of our Rights Shares may not be indicative of the market price of our Equity Shares
after the Issue.
The Issue Price of `201 per Rights Share may not be indicative of the market price for our Equity Shares after
the Issue. The market price of our Equity Shares could be subject to significant fluctuations after the Issue, and
27
may decline below the Issue Price. There can be no assurance that the Investor will be able to sell their shares at
or above the Issue Price. Among the factors that could affect our share price are:
quarterly variations in the rate of growth of our financial indicators, such as earnings per share, net
income and revenues;
changes in revenue or earnings estimates or publication of research reports by analysts;
speculation in the press or investment community;
general market conditions; and
domestic and international economic, legal and regulatory factors unrelated to our performance.
10. The Competition Act, 2002, by regulating our Company’s business and activities, may materially and
adversely affect our Company’s results of operations and financial condition.
Under the Competition Act, any arrangement, understanding or action, whether formal or informal, which
causes or is likely to cause an appreciable adverse effect on competition is void, and any abuse of dominant
position by an enterprise which is in a dominant position, is void and will be subject to substantial penalties. It is
unclear how the Competition Act will affect industries in India and our Company’s business. Consequently, our
Company cannot assure prospective investors that enforcement under the Competition Act will not have a
material adverse effect on its results of operations and financial condition.
11. A third party could be prevented from acquiring control of our Company because of the Takeover
Regulations under Indian law.
There are provisions in Indian law that may discourage a third party from attempting to take control of our
Company, even if it would result in the purchase of our Equity Shares at a premium to the market price or would
otherwise be beneficial to our Company’s Shareholders. Indian takeover regulations contain certain provisions
that may delay, deter or prevent a future takeover or change in control so as to ensure that the interests of
shareholders are protected. Any person acquiring either “control” or an interest (either on its own or together
with parties acting in concert with it) in 25% or more of our Company’s voting Equity Shares must make an
open offer to acquire at least another 26% of our Company’s outstanding voting Equity Shares. A takeover offer
to acquire at least another 26% of our Company’s outstanding voting Equity Shares also must be made if a
person (either on its own or together with parties acting in concert with it) holding between 25% and 55% of our
Company’s voting Equity Shares has entered into an agreement to acquire or decided to acquire additional
voting Equity Shares in any financial year that exceed 5% of our Company’s voting Equity Shares. These and
other applicable provisions may discourage or prevent certain types of transactions involving an actual or
threatened change in control.
12. Global economic, political and social conditions may harm our ability to do business, increase our
costs and negatively affect our stock price.
External factors such as potential terrorist attacks, terror threats, pandemics, acts of war or geopolitical and
social turmoil in many parts of the world could prevent or hinder our ability to do business, increase our costs
and negatively affect our stock price. For example, increased instability may adversely impact the desire of
employees and customers to travel, the reliability and cost of transportation, our ability to obtain adequate
insurance at reasonable rates or require us to incur increased costs for security measures for our operations.
These uncertainties make it difficult for us and our customers to accurately plan future business activities. More
generally, these geopolitical social and economic conditions could result in increased volatility in India and
worldwide financial markets and economy.
13. A significant change in the central and state governments’ economic liberalization and deregulation
policies could disrupt our business. A change in taxation laws could also adversely impact our financial
condition and results of operations.
India has been following a course of economic liberalization and our business could be significantly influenced
by economic policies adopted by the Government. Since 1991, successive Indian Governments have pursued
policies of economic liberalization and financial sector reforms. The Government has at various times
announced its general intention to continue India‘s current economic and financial liberalization and
deregulation policies. However, protests against privatizations and other factors could slow the pace of
liberalization and deregulation. The rate of economic liberalization could change, and specific laws and policies
affecting foreign investment, currency exchange rates and other matters affecting investment in India could
28
change as well.
The Government has traditionally exercised and continues to exercise influence over many aspects of the
economy. Our business and the market price and liquidity of our Equity Shares may be affected by interest rates,
changes in Government policy, taxation, social and civil unrest and political, economic or other developments in
or affecting India. Furthermore, the laws applicable to certain critical aspects of our business, such as the
conduct of clinical trials, in India and abroad may be amended or modified periodically.
14. There are restrictions on daily movements in the trading price of the Equity Shares, which may
adversely affect a shareholder’s ability to sell the Equity Shares or the price at which Equity Shares can be
sold at a particular point in time.
The Equity Shares are subject to a daily circuit breaker imposed on listed companies by all stock exchanges in
India, which does not allow transactions beyond certain volatility in the trading price of the Equity Shares. This
circuit breaker operates independently of the index-based market-wide circuit breakers generally imposed by
SEBI on the Stock Exchanges. The percentage limit on the Equity Shares’ circuit breaker will be set by the
stock exchanges based on historical volatility in the price and trading volume of the Equity Shares. The stock
exchanges are not required to inform us of the percentage limit of the circuit breaker. This circuit breaker would
effectively limit the upward and downward movements in the trading price of the Equity Shares. As a result of
this circuit breaker, there can be no assurance regarding the ability of shareholders to sell the Equity Shares or
the price at which shareholders may be able to sell their Equity Shares.
15. Foreign investors are subject to foreign investment restrictions under Indian law that limit our
ability to attract foreign investors, which may adversely affect the trading price of the Equity Shares.
Under the foreign exchange regulations currently in force in India, transfers of shares between non-residents and
residents are freely permitted (subject to certain exceptions) if they comply with the requirements specified by
the RBI. If the transfer of shares is not in compliance with such requirements or falls under any of the specified
exceptions, then prior approval of the RBI or the FIPB will be required. In addition, shareholders who seek to
convert the Rupee proceeds from a sale of shares in India into foreign currency and repatriate that foreign
currency from India will require a no-objection or tax clearance certificate from the income tax authority.
Additionally, the Indian government may impose foreign exchange restrictions in certain emergency situations,
including situations where there are sudden fluctuations in interest rates or exchange rates, where the Indian
government experiences extreme difficulty in stabilising the balance of payments or where there are substantial
disturbances in the financial and capital markets in India. These restrictions may require foreign investors to
obtain the Indian government’s approval before acquiring Indian securities or repatriating the interest or
dividends from those securities or the proceeds from the sale of those securities. There can be no assurance that
any approval required from the RBI or any other government agency can be obtained on any particular terms or
at all.
16. Conditions in the Indian securities market may affect the price or liquidity of the Equity Shares.
The Indian securities markets are smaller than securities markets in more developed economies. Indian Stock
Exchanges have in the past experienced substantial fluctuations in the prices of listed securities. These
exchanges have also experienced problems that have affected the market price and liquidity of the securities of
Indian companies, such as temporary exchange closures, broker defaults, settlement delays and strikes by
brokers. In addition, the governing bodies of the Indian Stock Exchanges have from time to time restricted
securities from trading, limited price movements and restricted margin requirements. Further, disputes have
occurred on occasion between listed companies and the Indian Stock Exchanges and other regulatory bodies
that, in some cases, have had a negative effect on market sentiment. If similar problems occur in the future, the
market price and liquidity of the Equity Shares could be adversely affected.
17. Any future issuance of the Securities may dilute your future shareholding and sales of the Securities
by the Promoter or other major shareholders of our Company may adversely affect the trading price of the
Securities.
Any future equity issuances by our Company may lead to dilution of your future shareholding in our Company.
Any future equity issuances by our Company or sales of the Securities by the Promoter or other major
shareholders of our Company may adversely affect the trading price of the Securities. In addition, any
perception by investors that such issuances or sales might occur could also affect the trading price of the
29
Securities.
Except as otherwise stated in the Letter of Offer, there is no restriction on our Company’s ability to issue the
Securities or the relevant shareholders’ ability to dispose of their Securities, and there can be no assurance that
our Company will not issue Securities or that any such shareholder (including Promoter and Promoter Group)
will not dispose of, encumber, or pledge its Securities.
18. The Securities may experience price and volume fluctuations or an active trading market for the
Securities may not develop.
The price of the Securities may fluctuate after this Issue as a result of several factors, including volatility in the
Indian and global securities markets, the results of our operations, the performance of our competitors, adverse
media reports on us, changes in the estimates of our performance or recommendations by financial analysts,
significant developments in India’s economic liberalisation and deregulation policies, and significant
developments in India’s fiscal regulations. Further, the price at which the Securities are initially traded may not
correspond to the prices at which the Securities will trade in the market subsequently.
PROMINENT NOTES
1. Issue of 74,62,686 Equity Shares of face value of ` 10 each for cash at a price of ` 201 per Equity
Share including a share premium of ` 191 per Equity Share aggregating up to ` 15,000 lacs to the
existing Equity Shareholders on a rights basis in the ratio of 2 Equity Shares for every 7 Equity Shares
held by them on the Record Date .
2. As on March 31, 2015, our net worth on standalone basis was ` 47,273.36 lacs and ` 41,368.45 lacs on
consolidated basis (excluding debenture redemption reserve) as described in the section “Financial
Information” on page 72 of the Letter of Offer.
3. For details of our transactions with the related parties during Fiscal 2015 as per AS 18, the nature of
such transactions and the cumulative value of such transactions, please see the section “Financial
Information” on page 72 of the Letter of Offer.
4. There has been no financing arrangement whereby the Promoter Group, our Directors, directors of our
Promoter and their relatives have financed the purchase by any other person of our securities during the
period of six months immediately preceding the date of filing of the Draft Letter of Offer with SEBI.
Investors may contact the Lead Manager for any complaint, clarifications and information pertaining to the
Issue. Any clarification or information relating to this Issue shall be made available by the Lead Manager to the
public and investors at large and no selective or additional information would be made available only to a
section of the investors in any manner. All grievances relating to ASBA process may be addressed to the
Registrar to the Issue, with a copy to the relevant SCSBs, giving full details such as name, address of the
applicants, application number, number of Equity Shares applied for, Bid Amounts blocked, ASBA Account
number and the Designated Branch of the SCSBs where the ASBA Bid-cum-Application Form has been
submitted by the ASBA Bidder. For contact details please see section “General Information” on page 34 of the
Letter of Offer.
30
SECTION III- INTRODUCTION
SUMMARY OF THE ISSUE
The following is a summary of the Issue. This summary should be read in conjunction with, and is qualified in
its entirety by, more detailed information in the section “Terms of the Issue” on page 167 of the Letter of Offer.
This issue of Equity Shares is being made by us as set forth below:
Equity Shares offered in this Issue 74,62,686 Equity Shares
Rights Entitlement 2 Equity Share(s) for every 7 Equity Share(s) held on the
Record Date.
Record Date January 12, 2016
Face Value per Equity Share ` 10
Issue Price per Equity Share ` 201
Issue Size Up to ` 15,000 lacs
Paid-up Equity Shares outstanding prior to the Issue 2,61,18,348 Equity Shares
Equity Shares outstanding after the Issue (assuming
full subscription for and Allotment of the Rights
Equity Shares)
3,35,81,034 Equity Shares
Terms of the Issue For more information, please see the section “Terms of
the Issue” on page 167 of the Letter of Offer.
Use of Issue Proceeds For further information, please see the section “Objects
of the Issue” on page 44 of the Letter of Offer.
Scrip Code ISIN: INE890A01016
BSE: 522263
NSE: JMCPROJECT
Terms of Payment
The full amount of Issue Price ` 201 per Equity Share is payable on Application.
31
SUMMARY OF FINANCIAL INFORMATION
The following tables set forth the summary financial information derived from our audited consolidated
financial statements as on and for Fiscal 2015 and Fiscal 2014 prepared in accordance with Companies Act, the
Indian GAAP, applicable standards and guidance notes specified by the Institute of Chartered Accountants of
India, applicable accounting standards and other applicable statutory and / or regulatory requirements. Our
summary of financial information presented below, is in ` in lacs and should be read in conjunction with the
financial information and the notes thereto included in the section titled “Financial Information”, on page 72 of
the Letter of Offer.
Consolidated Balance Sheet as at March 31, 2015
(` in Lacs)
Particulars As at March 31, 2015 As at March 31, 2014
I. EQUITY AND LIABILITIES
(1) Shareholders' Funds
(a) Share Capital 2611.83 2611.83
(b) Reserves and Surplus 39112.87 42454.05
41724.70 45065.88
(2) Non Current Liabilities
(a) Long-Term Borrowings 162594.55 129151.87
(b) Other Long Term Liabilities 32583.53 22712.02
(c) Long-Term Provisions 4461.86 3402.31
199639.94 155266.20
(3) Current Liabilities
(a) Short-Term Borrowings 26839.65 13447.32
(b) Trade Payables 60682.21 57152.17
(c) Other Current Liabilities 24869.20 17480.32
(d) Short-Term Provisions 486.31 1419.59
112877.37 89499.40
TOTAL 354242.01 289831.48
II. ASSETS
(1) Non-Current Assets
(a) Fixed Assets
(i) Tangible Assets 31892.50 27491.66
(ii) Intangible Assets 170410.81 40381.41
(iii) Capital Work-in-Progress 8.07 928.90
(iv) Intangible Assets under Development 3202.12 103748.59
205513.50 172550.56
(b) Non Current Investments 1054.82 926.91
(c) Deferred Tax Assets (Net) 1533.88 1658.07
(d) Long-Term Loans and Advances 7093.22 8007.57
(e) Other Non-Current Assets 5419.86 4083.06
220615.28 187226.17
(2) Current Assets
(a) Inventories 25166.48 24250.76
(b) Trade Receivables 40671.00 25770.83
(c) Cash and Bank Balances 2226.91 2883.60
(d) Short-Term Loans and Advances 25956.84 20197.34
(e) Other Current Assets 39605.50 29502.78
133626.73 102605.31
TOTAL 354242.01 289831.48
32
Consolidated Statement of Profit and Loss for the year ended March 31, 2015
(` in Lacs)
Particulars For the year ended
March 31, 2015
For the year ended
March 31, 2014
INCOME
Revenue from Operations 246977.89 266371.43
Other Income 1330.20 857.92
TOTAL REVENUE 248308.09 267229.35
EXPENSES
Construction Materials Consumed 85926.48 88239.83
(Increase) / Decrease in Inventories of Work-in-Progress (2410.18) (1742.12)
Employee Benefit Expense 20128.33 16915.15
Finance Cost 15976.83 7895.89
Depreciation and Amortization Expense 6500.28 6100.62
Other Expenses 123239.18 150146.21
TOTAL EXPENSES 249360.92 267555.58
Profit before exceptional and extraordinary items and tax (1052.83) (326.23)
Exceptional Items
-
-
Profit before extraordinary items and tax (1052.83) (326.23)
Extraordinary Items
-
-
Profit before tax (1052.83) (326.23)
Tax Expense :
Current Tax 914.54 633.15
Deferred Tax 462.77 102.12
Profit / (Loss) for the year (2430.14) (1061.50)
Earnings per equity share : [Nominal value Rs.10/- per
share]
Basic (in Rs.) (9.30) (4.06)
Computed on the basis of profit for the year
Diluted (in Rs.) (9.30) (4.06)
Computed on the basis of profit for the year
33
Consolidated Cash Flow Statement for the year ended March 31, 2015
(` in lacs)
PARTICULARS For the year ended
March 31, 2015
For the year ended
March 31, 2014
A. CASH FLOW FROM OPERATING ACTIVITIES
PROFIT BEFORE TAX AND EXTRAORDINARY ITEMS (1052.83) (326.23)
ADD / (DEDUCT) ADJUSTMENTS FOR :
Depreciation 6500.28 6100.62
Interest Paid 15976.83 7895.89
Unrealised (Profit) / Loss from Exchange Rate Variation 16.15 (44.10)
Amortization of ancillary cost & Site Infrastructures 3014.55 3167.37
Loss on Assets Lost 22.05 33.38
Deferred Employee Compensation written back (44.78) (58.35)
Interest Income (580.76) (99.05)
Dividend Income (0.06) (0.24)
(Profit) / Loss on Sale of Assets (Net) (144.74) (220.40)
Share of Profit from Investment in Joint Venture (128.12) (230.79)
Share of Loss from Investment in Joint Venture 0.48 7.04
OPERATING PROFIT BEFORE WORKING CAPITAL
CHANGES 23579.05 16225.14
ADJUSTMENTS FOR :
Trade & Other Receivables (33324.40) (27035.33)
Inventories (915.72) (3080.60)
Trade & Other Payables 20822.13 25814.98
CASH GENERATED FROM OPERATIONS 10161.06 11924.19
Direct Taxes Paid (2852.92) (2741.80)
NET CASH FLOW FROM OPERATING ACTIVITIES 7308.14 9182.39
B. CASH FLOW FROM INVESTING ACTIVITIES
Investment in Fixed Assets (7940.43) (50246.63)
Investment in Intangible Assets under Development (31116.59) (16640.40)
Sale of Fixed Assets 333.25 830.74
Share of Profit from Investment in Joint Venture 128.12 230.79
Share of Loss from Investment in Joint Venture (0.48) (7.04)
Deposit with Banks 185.96 (184.51)
Non-Current Investments (127.91) (225.78)
Interest Received 580.76 99.05
Dividend Received 0.06 0.24
NET CASH FLOW FROM INVESTING ACTIVITIES (37957.26) (66143.54)
C. CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from Issue of Equity Share Capital / Securities
Premium
- 0.11
Proceeds from Grant-in-aid - 4950.00
Proceeds from Term Borrowings 41716.79 64710.07
Repayment of Term Borrowings (8274.11) (5292.25)
Working Capital Finance 13392.33 (1603.23)
Interest Paid (16,351.05) (6356.59)
Dividend Paid (261.18) (261.18)
Corporate Dividend Tax Paid (44.39) (44.39)
NET CASH FLOW FROM FINANCING ACTIVITIES 30,178.39 56102.54
NET INCREASE / (DECREASE) IN CASH PAID & CASH
EQUIVALENTS (470.73) (858.60)
OPENING BALANCE OF CASH & CASH
EQUIVALENTS 2559.86 3418.46
CLOSING BALANCE OF CASH & CASH
EQUIVALENTS 2089.13 2559.86
34
GENERAL INFORMATION
The Company was originally incorporated as Civen Construction Private Limited on June 5, 1986 under the
Companies Act, 1956 with its registered office at Ahmedabad. Subsequently, on December 10, 1987, the name
was changed to Joshi & Modi Constructions Private Limited. The name was further changed to JMC Projects
(India) Private Limited on January 21, 1994 and was subsequently converted into a Public Limited Company in
the name of JMC Projects (India) Limited on February 4, 1994.
Registered Office of our Company
JMC Projects (India) Limited
A-104, Shapath-4,
Opposite Karnavati Club,
S.G.Road, Ahmedabad – 380 051, India
Tel No.: +91-79-3001 1500
Fax No.: +91-79-3001 1700
Email: [email protected]
Corporate Identity No.: L45200GJ1986PLC008717
Our Mumbai Office
6th
Floor, Kalpataru Synergy,
Opp. Grand Hyatt, Santacruz (East),
Mumbai 400055
Tel No.: +91 22 3005 1500
Fax No.: +91 22 3005 1555
Email: [email protected]
Website: www.jmcprojects.com
Address of the Registrar of Companies
Registrar of Companies, Gujarat
ROC Bhavan,
Opposite Rupal Park Society,
Near Ankur Bus Stand,
Naranpura,
Ahmedabad – 380 013
Gujarat, India
Company Secretary and Compliance Officer
Mr. Sandeep Kumar Sharma
6th Floor, Kalpataru Synergy,
Opp. Grand Hyatt, Santacruz (East),
Mumbai 400055.
Tel: +91 22 30051500.
Fax: +91 22 30051555.
Email: [email protected]
Website: www.jmcprojects.com
Lead Manager to the Issue
Inga Capital Private Limited
Naman Midtown
21st Floor, ‘A’ Wing
Senapati Bapat Marg
Elphinstone (West)
Mumbai 400 013,
Maharashtra, India
Tel: +91 22 4031 3489
Fax: +91 22 4031 3379
35
Website: www.ingacapital.com
E-mail: [email protected]
Investor Grievance E-mail: [email protected]
Contact Person: Ashwani Tandon
SEBI Registration No.: INM000010924
Legal Counsel to the Issue
Khaitan & Co
One Indiabulls Centre
Tower 1, 13th
Floor
841 Senapati Bapat Marg
Mumbai – 400 013
Maharashtra, India
Tel: +91 22 6636 5000
Fax: +91 22 6636 5050
Registrar to the Issue
Link Intime India Private Limited
C-13, Pannalal Silk Mills Compound
L.B.S. Marg
Bhandup (West), Mumbai - 400 078
Maharashtra, India
Tel No.: +91 22 6171 5400
Fax No.: +91 22 2596 0329
Email: [email protected]
Investor Grievance E-mail: [email protected]
Website: www.linkintime.co.in
Contact Person: Mr. Dinesh Yadav
SEBI Registration: INR000004058
Statutory Auditor of the Company
M/s Kishan M. Mehta & Co.
Chartered Accountants
6, Premchand House Annexe
Ashram Road
Ahmedabad - 380 009
Tel: +91-79-2658 1570
Fax: +91-79-2658 5229
Firm Registration No.:105229W
Email: [email protected]
Investors may contact the Registrar to the Issue or the Company Secretary and Compliance Officer for any pre-
Issue/ post-Issue related matter. All grievances relating to the ASBA process may be addressed to the Registrar
to the Issue, with a copy to the SCSB, giving full details such as name, address of the applicant, number of
Equity Shares applied for, Amount blocked, ASBA Account number and the Designated Branch of the SCSB
where the CAF was submitted by the ASBA Investors.
Banker to the Issue
YES Bank Limited
3rd
Floor, Building No. 8, Tower A,
DLF Cyber City,
Gurgaon -122002
Tel No.: +91 124 4619205/119
Fax No.: +91 124 4147193
Email: [email protected]
Website: www.yesbank.in
36
Contact Person: Mr. Varun Kathuria / Mr. Qumarey Khan
SEBI Registration: INBI00000935
Expert
Except as stated below, our Company has not obtained any expert opinions:
Our Company has received written consent from the Auditors namely, M/s Kishan M. Mehta & Co., Chartered
Accountants to include its name as an expert under Section 2(38) and Section 26(5) of the Companies Act in the
Letter of Offer in relation to the (1) report of the Auditors on Audited Financial Statements dated May 29, 2015
and the (2) limited review report on the limited reviewed unaudited standalone financial statement for quarter
ended September 30, 2015 and limited reviewed unaudited consolidated financial statements for six month
ended on Septmeber 30, 2015. Our Company has also received written consent from M/s Kishan M. Mehta &
Co., Chartered Accountants, to include its name as an expert under Section 58 of the Companies Act in this
Letter of Offer in relation to the report on statement of tax benefits dated December 23, 2015 and such consent
has not been withdrawn as of the date of the Letter of Offer. The term“experts”and consent thereof does not
represent an expert or consent within the meaning under the Securities Act, 1933 of the United States of
America
Self Certified Syndicate Banks
The list of banks that have been notified by SEBI to act as SCSBs for the ASBA process is provided on
www.sebi.gov.in. Details relating to designated branches of SCSBs collecting the ASBA application forms are
available at the above mentioned link.
Issue Schedule
Issue Opening Date: January 22, 2016
Last date for receipt of request for SAFs: January 29, 2016
Issue Closing Date: February 5, 2016
Finalisation of basis of allotment with the Designated
Stock Exchange
on or about February 15, 2016
Initiation of Refunds on or about February 16, 2016
Credit of Equity Shares to demat accounts of
Allotees
on or about February 18, 2016
Commencement of trading of Equity Shares on the
Stock Exchanges
on or about February 19, 2016
The Board of Directors or a duly authorized committee thereof will have the right to extend the Issue period as it
may determine from time to time, provided that the Issue will not be kept open in excess of 30 days from the
Issue Opening Date.
Credit rating
As the Issue is a rights issue of Equity Shares, no credit rating is required.
Statement of responsibility
Since Inga Capital Private Limited is the sole Lead Manager to the Issue, all the responsibilities of the Issue will
be managed by them.
Debenture trustee
This being an issue of equity shares, a debenture trustee is not required.
Appraisal Agency
None of the purposes for which the Net Proceeds are proposed to be utilised have been financially appraised by
any bank or financial institution.
37
Monitoring Agency
Since the proceeds from the Issue are less than Rs.50,000 lacs, in terms of Regulation 16(1) of the SEBI
Regulations, our Company is not required to appoint a monitoring agency for the purposes of this Issue.
Underwriters and details of Underwriting Agreement
Our Company has not entered into any underwriting arrangement, for the Issue.
Minimum Subscription
If our Company does not receive the minimum subscription of 90% of the Issue, or the subscription level falls
below 90%, after the Issue Closing Date on account of cheques being returned unpaid or withdrawal of
applications, our Company shall refund the entire subscription amount received within 15 days from the Issue
Closing Date. In the event that there is a delay of making refunds beyond such period as prescribed by
applicable laws, our Company shall pay interest for the delayed period at rates prescribed under applicable laws.
The above is subject to the terms mentioned under the section titled ‘Terms of the Issue’ on page 167 of the
Letter of Offer.
Principal Terms of Loans and Assets charged as security
For details in relation to the principal terms of loans and assets charged as security of our Company, please see
the section “Financial Information” on page 72 of the Letter of Offer.
38
CAPITAL STRUCTURE
The Capital Structure of the Company and related information as on the date of Letter of Offer is set forth
below:
Aggregate
Nominal Value
(` in lacs)
Aggregate
Value at Issue
Price
Authorised Share Capital
3,50,00,000 Equity Shares of face value ` 10 each 3,500.00 -
15,00,000 Preference Shares of ` 100 each 1,500.00 -
Issued, subscribed and fully paid up capital
2,61,18,348 Equity Shares of face value ` 10 each fully paid-
up
2,611.83 -
Present Issue being offered to the Equity
Shareholders through the Letter of Offer
74,62,686 Rights Equity Shares of face value ` 10 each at a
premium of ` 191 i.e. at an Issue Price of ` 201*
746.27 15,000.00
Issued, subscribed and fully paid up capital after
the Issue (assuming full subscription for and
allotment of the Rights Entitlement)
3,35,81,034 Equity Shares of face value ` 10 each fully paid-
up
3,358.10 -
Securities premium account
Existing securities premium account 21,209.18
Securities premium account after the Issue 35,462.91#
Notes:
This issue has been authorized by the Board of Directors under section 62(1)(a) and other provisions of the
Companies Act, 2013 in its meetings held on September 11, 2015.
*The present Issue of Equity Shares on a rights basis is in the ratio of 2 Equity Shares for every 7 Equity Shares
held by our existing equity shareholders on the Record Date i.e.January 12, 2016.
# Assuming full subscription and Allotment of the Rights Equity Shares in the Issue, without deducting issue
expenses.
39
Notes to the Capital Structure
1. The shareholding pattern of our Company as on September 30, 2015 is as follows:
Category of
Shareholder
No. of
Shareholders
Total No. of
Shares
Total No. of
Shares held in
Dematerialized
Form
Total Shareholding
as a % of Total No.
of Shares
Shares pledged or
otherwise
encumbered
As a
% of
(A+B)
As a % of
(A+B+C)
Number
of shares
As a %
of
Total
No. of
Shares
(A) Promoter and
Promoter Group
(1) Indian
Individuals/Hindu
Undivided Family
0 0 0 0.00 0.0 0 0.00
Central
Government/State
Government(s)
0 0 0 0.00 0.0 0 0.00
Bodies Corporate 1 1,75,48,908 1,75,48,908 67.19 67.19 0 0.00
Financial Institutions
/ Banks
0 0 0 0.00 0.0 0 0.00
Any Other (specify) 0 0 0 0.00 0.0 0 0.00
Trusts
Sub Total (A)(1) 1 1,75,48,908 1,75,48,908 67.19 67.19 0 0.00
(2) Foreign
Individuals (Non-
Resident
Individuals/Foreign
Individuals)
0 0 0 0.00 0.0 0 0.00
Bodies Corporate 0 0 0 0.00 0.0 0 0.00
Institutions 0 0 0 0.00 0.0 0 0.00
Qualified Foreign
Investors
0 0 0 0.00 0.0 0 0.00
Any Other (specify) 0 0 0 0.00 0.0 0 0.00
Sub Total (A)(2) 0 0 0 0.00 0.0 0 0.00
Total Shareholding
of Promoter and
Promoter Group
(A)=(A)(1)+(A)(2)
1 1,75,48,908 1,75,48,908 67.19 67.19 0 0.00
Public shareholding N.A N.A
Institutions N.A N.A
Mutual Funds/UTI 3 12,29,072 12,28,472 4.71 4.71
Financial Institutions
/ Banks 1 3,274 3,274 0.01 0.01
Central /State
Government(s)
0 0 0 0.00 0.00
Venture Capital
Funds
0 0 0 0.00 0.00
Insurance Companies 0 0 0 0.00 0.00
Foreign Institutional
Investors 1 1,50,846
1,50,846
0.58 0.58
Foreign portfolio
investors (corporate)
5 11,69,027 11,69,027 4.48 4.48
Foreign Venture
Capital Investors
0 0 0 0.00 0.00
Qualified Foreign
Investors
0 0 0 0.00 0.00
Any Other (specify) 0 0 0 0.00 0.00
Sub Total (B) (1) 10 25,52,219 25,51,619 9.77 9.77
Non-institutions N.A N.A
Bodies Corporate 286 8,30,989
8,28,188
3.18 3.18
40
Category of
Shareholder
No. of
Shareholders
Total No. of
Shares
Total No. of
Shares held in
Dematerialized
Form
Total Shareholding
as a % of Total No.
of Shares
Shares pledged or
otherwise
encumbered
As a
% of
(A+B)
As a % of
(A+B+C)
Number
of shares
As a %
of
Total
No. of
Shares
Individuals -
shareholders holding
nominal share capital
up to Rs. 1 Lakh
8,799 29,51,165 28,36,304 11.30 11.30
Individual
shareholders holding
nominal share capital
in excess of Rs. 1
Lakh
38 10,27,563 10,27,563 3.93 3.93
Qualified Foreign
Investors
0 0 0 0.00 0.00
Any Other
Non Resident Indians 172 9,40,264 9,40,214 3.60 3.60
Clearing Member 108 56,240 56,240 0.22 0.22
Trusts 2 9,292 9,292 0.04 0.04
Hindu Undivided
Family
289 2,01,708 2,01,708 0.77 0.77
Sub Total (B)(2) 9,694 60,17,221 58,99,509 23.04 23.04
Total Public
Shareholding
Public Group
(B)=(B)(1)+(B)(2)
9.704 85,69,440 84,51,128 32.81 32.81 N.A N.A
Total (A)+(B)
9,705 2,61,18,348 2,60,00,036 100.0
0
100.00
Shares held by
custodians and
against which
Depository Receipts
have been issued
0 0 0 N.A 0 N.A N.A
Promoter and
Promoter group
0 0 0 N.A 0.00
Public 0 0 0 N.A 0.00
Sub Total ( C ) 0 0 0 N.A 0.00
GRAND TOTAL
(A)+(B)+(C) 9,705 2,61,18,348 2,60,00,036
100.0
0 100.00
41
Equity Shareholders belonging to the category “Promoter and Promoter Group” of our Company as on
September 30, 2015 is detailed in the table below:
Sr.
No
(I)
Name of
the
sharehol
der
(II)
Details of Shares
held
Encumbered shares
(*)
Details of
warrants
Details of
convertible
securities
Total shares
(including
underlying
shares
assuming
full
conversion
of warrants
and
convertible
securities) as
a % of
diluted
share capital
(XII)
No. of
Shares
held
(III)
As a
% of
grand
total
(A) +
(B) +
(C)
(IV)
N
o.
(
V
)
As a
percen
tage
(VI) =
(V) /
(III)*
100
As a
% of
grand
total
(A) +
(B) +
(C) of
sub-
clause
(I)(a)
(VII)
Num
ber
of
warr
ants
held
(VIII
)
As a %
total
numbe
r of
warran
ts of
the
same
class
(IX)
Numbe
r of
convert
ible
securiti
es held
(X)
As a %
total
number
of
converti
ble
securitie
s of the
same
class
(XI)
1 Kalpataru
Power
Transmis
sion Ltd.
1,75,48,
908
67.19 0 0.00 0.00 0 0.00 0 0.00 0
Total 1,75,48,
908
67.19 0 0.00 0.00 0 0.00 0 0.00 0
Statement showing shareholding of persons belonging to the category "Public" and holding more than
1% of the total number of shares of our Company as on September 30, 2015:
Sl.
No.
Name of the
Shareholder No. of Shares held
Shares
as % of
Total
No. of
Shares
Details of warrants Details of convertible
securities
Total
shares
(including
underlying
shares
assuming
full
conversion
of
warrants
and
convertible
securities)
as a % of
diluted
share
capital
Number
of
warrants
held
As a %
total
number
of
warrants
of the
same
class
Number of
convertible
securities
held
% w.r.t
total
number of
convertible
securities
of the
same class
1 HDFC Trustee
Company
Limited-
HDFC Infra
fund
12,28,472 4.70 Nil Nil Nil Nil Nil
2 Acacia
Partners, LP
5,13,628 1.97 Nil Nil Nil Nil Nil
3 Dr. Sanjeev
Arora
3,71,515 1.42 Nil Nil Nil Nil Nil
4 Acacia
Institutional
Partners, LP
3,65,001 1.40 Nil Nil Nil Nil Nil
Total 24,78,616 9.49 0 0 0 0 0
42
Statement showing holding of securities (including shares, warrants, convertible securities) of persons
(together with PAC) belonging to the category “public” and holding more than 5% of the total number of
shares of our Company as on September 30, 2015 is detailed in the table below:
Sr. No.
Name(s) of the
shareholder(s) and
the Persons Acting
in Concert (PAC)
with them
Number
of
shares
Shares
as a %
of total
number
of
shares
Details of warrants Details of convertible
securities Total
shares
as a % of
diluted
share
capital
No of
warrants
As a % total
number of
warrants of
the same
class
Number of
convertible
securities
held
% w.r.t total
number of
convertible
securities
of the same
class
1 None 0 0 Nil Nil Nil Nil Nil
TOTAL 0 0 0 0 0 0 0
Statement showing details of Locked-in shares of our Company as onSeptember 30, 2015 is detailed in the
table below:
Sl. No. Name of the
Shareholder No. of Shares Locked-in Shares as % of Total No. of Shares
1 None 0 N.A
Total 0 0.00
Statement showing details of Depository Receipts of our Company of as on September 30, 2015 is detailed
in the table below:
Sl. No. Type of Outstanding DR
(ADRs, GDRs, SDRs, etc.)
No. of
Outstanding
DRs
No. of Shares
Underlying
Outstanding DRs
Shares Underlying Outstanding DRs
as % of Total No. of Shares
1 Nil 0 N.A. N.A
Total 0 0 0.00
Statement showing Holding of Depository Receipts (DRs), where underlying shares held by 'promoter /
promoter group' are in excess of 1% of the total number of shares of our Company as on September 30,
2015 is detailed in the table below:
Sl. No. Name of the DR
Holder
Type of Outstanding DR
(ADRs, GDRs, SDRs, etc.)
No. of Shares
Underlying
Outstanding DRs
Shares Underlying
Outstanding DRs as a % of
Total No. of Shares
1 None Nil N.A. 0.00
Total 0 0 0.00
Statement showing the voting pattern of shareholders, if more than one class of shares/securities is issued by the issuer
Not applicable-Company issued only one class of equity shares
2. No Equity Shares have been acquired by the Promoter or members of the Promoter Group in the year
immediately preceding the date of filing of the Draft Letter of Offer with SEBI.
3. None of the Equity Shares held by any of the shareholders of the Company are locked in.
4. There are no outstanding warrants, options or rights to convert debentures, loans or other instruments
convertible into the Equity Shares as on the date of this Letter of Offer:
5. Our Promoter through its letter dated September 23, 2015 has confirmed (on behalf of itself and other
members of promoter group), that, it, either through itself or through other member(s) of promoter group,
intend to subscribe to their Rights Entitlement in full in the Issue, in compliance with regulation 10(4) of
Takeover Regulations. In addition to subscription to their Rights Entitlements, the Promoter has also
confirmed that it, either through itself or through other member(s) of promoter group, also intend to (i)
subscribe to additional Equity Shares, and (ii) subscribe for unsubscribed portion in the Issue, if any. Such
subscription to additional Equity Shares and the unsubscribed portion, if any, shall be in accordance with
regulation 10(4) of Takeover Regulations subject to their total shareholding not exceeding 75% of the
43
issued, outstanding and fully paid up Equity Share capital in accordance with the provisions of the Equity
Listing Agreement.
Such subscription for Equity Shares over and above their Rights Entitlement, if allotted, may result in an
increase in their percentage shareholding. Any such acquisition of additional Equity Shares of the Company
shall not result in a change of control of the management of the Company in accordance with provisions of
the Takeover Regulations and shall be exempt in terms of Regulation 10 (4) (a) and (b) of the Takeover
Regulations.
6. The ex-rights price of the Equity Shares as per Regulation 10(4) (b) of the Takeover Regulations is `
227.57.
7. The Issue being a rights issue, as per regulation 34(c) of the SEBI Regulations, the requirements of
promoters’ contribution and lock-in are not applicable.
44
OBJECTS OF THE ISSUE
The objects of the Issue are:
1. Reduction in the outstanding amounts due in relation to certain fund based working capital facilities availed
by our Company on standalone basis;
2. Repayment along with interest/other charges, of certain borrowings availed by our Company on stand alone
basis; and
3. General corporate purposes.
The main objects set out in the Memorandum of Association enable us to undertake our existing activities. The
borrowings availed by our Company, which are proposed to be reduced/ paid, in full or part along with the
interest from the Net Proceeds of the Issue, are for activities carried out as enabled by the object clause of the
Memorandum of Association of our Company.
Requirement of Funds
The details of the Net Proceeds are set forth in the following table:
(in ` Lacs)
Particulars Estimated Amount
Gross proceeds of the Issue 15,000.00
Less: Issue expenses 147.00
Net Proceeds 14,853.00
Means of Finance
Our Company proposes to meet the entire requirement of funds for the proposed objects of the Issue from the
Net Proceeds. Accordingly, our Company confirms that there is no requirement to make firm arrangements of
finance through verifiable means towards at least 75% of the stated means of finance, excluding the amount to
be raised from the Issue.
Utilization of Net Proceeds
The utilization of the Net Proceeds will be in accordance with the table set forth below:
(in ` Lacs)
Sr. No. Particulars Estimated Amount to be utilised
1. Reduction in the outstanding amounts due in relation to
certain fund based working capital facilities availed by our
Company on standalone basis
5,000.00
2. Repayment along with interest, of certain borrowings availed
by our Companyon a standalone basis
6,300.00
3. General corporate purposes 3,553.00
Total 14,853.00
Schedule of Deployment
Our Company proposes to deploy the entire Net Proceeds towards the objects as described herein during
Financial Year 2016. However, if the Net Proceeds are not completely utilised for the objects stated above by
Financial Year 2016 due to factors including (i) any conditions attached to the borrowings restricting our ability
to repay/ prepay the borrowings along with the interest and time taken to fulfill, or obtain waivers for fulfillment
of, such requirements, (ii) receipt of consents for repayment/ prepayment from the respective lenders, (iii) terms
and conditions of such consents and waivers, (iv) levy of any repayment/prepayment penalties and the quantum
thereof , and (v) other considerations/ reasons, the same would be utilised (in part or full) in Fiscal Year 2017.
Penal interest or charges in relation to the repayment of the loans, if any shall be paid out of Issue Proceeds
earmarked for General corporate purposes.
The funds deployment described herein is based on management estimates and current circumstances of our
45
business. It has not been appraised by any bank, financial institution or any other external agency. Given the
dynamic nature of our business, we may have to revise our funding requirements and deployment on account of
variety of factors such as our financial condition, business and strategy, including external factors which may
not be within the control of our management. This may entail rescheduling and revising the planned funding
requirements and deployment and increasing or decreasing the funding requirements from the planned funding
requirements at the discretion of our management.
In case of variations in the actual utilization of funds earmarked for the purposes set forth above, increased fund
requirements for a particular purpose may be financed by surplus funds, if any, available in respect of other
purposes for which funds are being raised in this Issue.
The details in relation to objects of the Issue are set forth herein below.
1. Reduction in the outstanding amounts due in relation to certain fund based working capital facilities
availed by our Company on standalone basis.
Our business is working capital intensive and we fund our working capital requirements in the ordinary course
of our business from internal accruals and financing from various banks.
As on November 30, 2015, our Company had an outstanding of ` 20,626.60 lacs against fund based facilities
availed for the working capital requirements of our Company. The following are the fund based working capital
facilities availed by us.
Sr.
No.
Name of the lender and
documentation*
Amount
sanctioned1
(` in Lacs)
Amount
outstanding as on
November 30,
2015 (` in Lacs)
Rate of interest (per
annum)
Repayment date
/ schedule
1. Oriental Bank of
Commerce
Sanction Letter dated June
30, 2015
Working Capital Consortium
Agreement dated July 25,
2013
a) Cash credit:
` 13,150.00
Sub-limit of
Cash Credit
WCDL:
` 7,500.00
DBD
` 2,500.00
a) Cash credit:
` 315.00
Sub-limit of Cash
Credit
WCDL:
` 7,500.00
DBD:
` 1,156.00
a) Cash credit:
Base Rate+1.50%
(spread rate)
Sub-limit of Cash
Credit
WCDL- Base Rate
DBD– Base
Rate+0.25% (spread
rate)
Repayable on
Demand
2. State Bank of India
Sanction Letter dated
September 22, 2014
Working Capital Consortium
Agreement dated July 25,
2013
a) Cash credit:
` 8,375.00
Sub-limit of
Cash Credit
WCDL:
` 8,375.00
PC/PCFC/FBD:
` 1,400.00
a) Cash credit:
` 0.70
Sub-limit of Cash
Credit
WCDL:
` 6,047.10
PC/PCFC/FBD:
Nil
a) Cash credit:
Base Rate+1.25%
(spread rate)
Sub-limit of Cash
Credit
WCDL:
Base Rate+0.25%
PC/PCFC/FBD:
varying rates
determined by bank
at the time of
utilization
Repayable on
Demand
3. Karur Vysya Bank
Sanction Letter dated
September 28, 2015
Working Capital Consortium
Agreement dated July 25,
2013
a) Cash credit:
` 3,925.00
Sub-limit of
Cash Credit
WCDL:
` 3,000.00
a) Cash credit:
` 841.00
Sub-limit of Cash
Credit
WCDL:
1,000.00
a) Cash Credit:
Base Rate + 0.75%
(spread rate)
Sub-limit of Cash
Credit
WCDL- Base Rate
Repayable on
Demand
46
Sr.
No.
Name of the lender and
documentation*
Amount
sanctioned1
(` in Lacs)
Amount
outstanding as on
November 30,
2015 (` in Lacs)
Rate of interest (per
annum)
Repayment date
/ schedule
FCL:
` 1,680.00
b) DBD/ PBD:
` 525.00
FCL:
Nil
b) DBD/ PBD:
Nil
FCL:
6months Libor +
5.00%
b) DBD/ PBD:
Base Rate+0.75%
(spread rate)
4. IDBI Bank
Sanction Letter dated August
07, 2015
Working Capital Consortium
Agreement dated July 25,
2013
a) Cash credit:
` 4,200.00
Sub-limit of
Cash Credit
WCDL:
` 2,100.00
DBD/ PBD:
` 500.00
a) Cash credit:
` 688.79
Sub-limit of Cash
Credit
WCDL:
` 1,000.00
DBD/ PBD:
` 40.70
a) Cash Credit:
Base Rate +1.40%
(Spread rate)
Sub-limit of Cash
Credit
WCDL: varying rates
determined by bank
at the time of
utilization
DBD/ PBD:
varying rates
determined by bank
at the time of
utilization
Repayable on
Demand
5. Axis Bank
Sanction Letter dated June
27, 2014
Working Capital Consortium
Agreement dated July 25,
2013
a) Cash credit:
` 2,113.00
Sub-limit of
Cash Credit
WCDL:
` 2,113.00
FDBD/ PBD:
` 2,000.00
PC/PCFC/FBD:
` 2,000.00
b) Bill
Discounting
325.00
a) Cash credit:
` 731.56
Sub-limit of Cash
Credit
WCDL:
Nil
FDBD/ PBD:
Nil
PC/PCFC/FBD:
Nil
b) Bill
Discounting
Nil
a) Cash credit:
Base Rate+1.50%
(spread rate)
Sub-limit of Cash
Credit
WCDL:
Base Rate+1.00%
(spread rate)
FDBD/ PBD:
Base Rate+1.50%
(spread rate)
PC/PCFC/FBD:
Base Rate+ 1.50%
(spread rate)
b) Bill Discounting:
varying rates
determined by bank
at the time of
utilization
Repayable on
Demand
6. Punjab National Bank
Sanction Letter dated
October 31, 2015
Working Capital Consortium
Agreement dated July 25,
2013
a) Cash credit:
` 3,813.00
Sub-limit of
Cash Credit
PC/PCFC/FBD:
` 2,000.00
a) Cash credit:
` 12.80
Sub-limit of Cash
Credit
PC/PCFC/FBD:
Nil
a) Cash credit:
Base Rate + 1.90%
(spread rate)
Sub-limit of Cash
Credit
PC/PCFC/FBD:
Base Rate+0.75%
(spread rate)
Repayable on
Demand
47
Sr.
No.
Name of the lender and
documentation*
Amount
sanctioned1
(` in Lacs)
Amount
outstanding as on
November 30,
2015 (` in Lacs)
Rate of interest (per
annum)
Repayment date
/ schedule
b) DBD/ PBD:
` 450.00
Sub-limit of
Cash Credit and
DBD/ PBD
WCDL:
` 3,500.00
b) DBD/ PBD:
Nil
Sub-limit of Cash
Credit and DBD/
PBD
WCDL:
Nil
b) DBD/ PBD:
Base rate + 0.40%
(spread rate)
Sub-limit of Cash
Credit and DBD/
PBD
WCDL: Base rate +
0.40% (spread rate)
7. Indian Bank
Sanction Letter dated
September 1, 2014
Working Capital Consortium
Agreement dated July 25,
2013
a) Cash credit:
` 2,600.00
b) DBD:
` 650.00
a) Cash credit:
` 610.61
b) DBD:
` 144.20
a) Cash credit:
Base Rate +1.40%
(spread rate)
b) DBD:
Base Rate + 0.25%
(spread rate)
Repayable on
Demand
8. Union Bank of India
Sanction Letter dated June
18, 2014 and Modification
Letter dated October 27,
2014
Working Capital Consortium
Agreement dated July 25,
2013
a) Cash credit:
` 2,430.00
Sub-limit of
Cash Credit
WCDL:
` 2,430.00
FCL:
` 2,430.00
b) DBD/ PBD:
` 294.00
a) Cash credit:
` 263.07
Sub-limit of Cash
Credit
WCDL:
Nil
FCL:
Nil
b) DBD/ PBD:
` 275.07
Cash credit:
Base Rate+1.50%
(spread rate)
Sub-limit of Cash
Credit
WCDL: Base Rate +
1.50% (Spread)
FCL: varying rates
determined by bank
at the time of
utilization
b) DBD/ PBD:
Base Rate + 0.25%
(spread rate)
Repayable on
Demand
Total 41,875.00 20,626.60 # 1All of the aforesaid working capital facilities are part of the lending facilities sanctioned by the consortium of banks.
Further, the consortium of banks have sanctioned an overall limit of Rs. 15,000 lacs towards issue of commercial papers, as
a sub limit within the overall cash credit limits mentioned above.
* Of the aforesaid working capital facilities Oriental Bank of Commerce IDBI Bank, Karur Vysya Bank and Punjab National
Bank have renewed their working capital facilities vide sanction letter dated June 30, 2015, August 07, 2015, September 28,
2015 and October 31, 2015 respectively. Our Company is in the process of renewing the remaining facilities mentioned
above.
# In addition, to the amount outstanding, our Company has issued commercial papers worth Rs. 12,500 lacs by earmarking
the overall cash credit limit.
Details of working capital loan to be repaid by our Company
From the above mentioned working capital facilities, our Company proposes to utilize an estimated amount of `
5,000.00 lacs to repay facility availed from Oriental Bank of Commerce owing to certain commercial
considerations including higher interest rate as compared to other banks and more exposure of working capital
with Oriental Bank of Commerce as compared to other facility availed.
2. Repayment along with interest/other charges, of certain borrowings availed by our Company on a
standalone basis
48
Our Company proposes to utilize an estimated amount of ` 6,300.00 lacs from the Net Proceeds towards
repayment along with interest/other charges, of certain borrowings availed by our Company on a standalone
basis. Our Company may repay or refinance some of its existing borrowings prior to Allotment. Accordingly,
our Company may utilise the Net Proceeds for repayment along with interest of any such refinanced loans or
additional loan facilities obtained by it. However, the aggregate amount to be utilised from the Net Proceeds
towards repayment of borrowings along with the interest, if any, (including re-financed or additional loans
availed, if any), would not exceed ` 6,300.00 lacs.
We believe that such repayment will help reducing our outstanding indebtedness and enable utilization of our
accruals for further investment in business growth and expansion. In addition, we believe that the leverage
capacity of our Company will improve significantly to raise further resources in the future to fund our potential
business development opportunities and plans to grow and expand our business in the coming years. Further, the
facilities chosen by us for repayment have scheduled repayment in FY 2016
(a) Loan obtained from, Amber Real Estate Limited (AREL):
AREL is a 100% subsidiary of our Promoter. Our Company has obtained an unsecured loan of ` 4,000.00 lacs
from AREL vide agreement dated September 11, 2015. Important terms of the same are as below:
- Loan Amount: ` 4,000 lacs.
- Amount outstanding as on November 30, 2015:` 4,000.00 lacs and accrued interest of ` 188.63 Lacs. Our
Company proposed to repay Rs. 4,188.63 lacs from Net Issue Proceeds. - Rate of interest:11.25% per annum.
- Repayment: Repayable on demand.
Purpose – For general corporate purpose and/or the legitimate business purposes of our Company.
(b) Term loans availed from various banks by our Company
The following table provides details of term loans availed by our Company from various banks:
Sr.
No.
Name of the
lender, Type of
Loan and
documentation
Purpose
Amount
sanctioned
(` in Lacs)
Amount
outstanding
as on
November
30, 2015 (`
in Lacs)
Rate of
interest (per
annum)
Repayment
date /
schedule
1. DBS Bank
Limited
External
Commercial
Borrowing
Sanction letter
dated September
22, 2011
Facility
Agreement dated
October 15, 2011
To finance capital
expenditure requirements
in compliance with
external commercial
borrowing guidelines
4,990.00 1,535.38 7.28%
(Fixed)
Repayment
to be made
in 13 equal
quarterly
instalments
commencing
after
moratorium
period of.8
quarters
from the
first
drawdown
and the first
repayment
will be at
the end of
8th quarter.
2. Yes Bank
Limited
Term Loan
Facility letter
dated December
Long Term Working
Capital
6,500.00 3,656.25 Base Rate +
1.45%
Repayment
to be made
in 16 equal
quarterly
instalments.
First
instalment
49
Sr.
No.
Name of the
lender, Type of
Loan and
documentation
Purpose
Amount
sanctioned
(` in Lacs)
Amount
outstanding
as on
November
30, 2015 (`
in Lacs)
Rate of
interest (per
annum)
Repayment
date /
schedule
27, 2012
Loan Agreement
dated December
27, 2012
commencing
after 3
months from
the
moratorium
of 1year
from the
date of first
disbursemen
t.
3. Karur Vysya
Bank Limited
Term Loan
Sanction letter
dated December
8, 2012
Loan Agreement
dated December
28, 2012
Capital Expenditure for
procuring equipment’s /
machineries
2,500.00 1,406.14 Base Rate +
0.75%
Repayment
to be made
in 16 equal
quarterly
instalments
each
commencing
after
moratorium
period of 12
months.
.
4. ICICI Bank
Limited
Term Loan
Credit
arrangement
letter dated
September 9,
2014
Corporate rupee
loan facility
agreement dated
September 26,
2014
To part finance project
related capital expenditure
of our Company The
facility will be utilization
for part finance of capital
expenditure and
transaction related
expenses
4,000.00 4,000.00 Base Rate +
1.25%
Repayment
to be made
in unequal
quarterly
instalments
from
fifteenth day
of 6th
quarter and
every
quarter
thereafter.up
to 28th
quarter
5. ICICI Bank
Limited
Term Loan
Credit
arrangement
letter dated
August 26, 2013
Corporate rupee
loan facility
agreement dated
November 18,
2013
To repay term loans of our
Company, on-lending to
Subsidiaries, part finance
of capital expenditure and
transaction related
expenses.
10,000 9,500.00 Base Rate +
1.98%
Repayment
to be made
in unequal
quarterly
instalments
from
fifteenth day
of 6th
quarter and
every
quarter
thereafter
upto 7 years.
6. ICICI Bank
Limited
Term Loan
Credit
arrangement
letter dated
To repay term loans of our
Company, on-lending to
Subsidiaries, part finance
of capital expenditure and
transaction related
expenses.
3,000 3,000.00 Base Rate +
1.98%
Repayment
to be made
in unequal
quarterly
instalments
from
fifteenth day
of 6th
50
Sr.
No.
Name of the
lender, Type of
Loan and
documentation
Purpose
Amount
sanctioned
(` in Lacs)
Amount
outstanding
as on
November
30, 2015 (`
in Lacs)
Rate of
interest (per
annum)
Repayment
date /
schedule
August 26, 2013
Corporate rupee
loan facility
agreement dated
September 25,
2014
quarter and
every
quarter
thereafter
upto 7 years.
7. Aditya Birla
Finance Limited
Term Loan
Credit
arrangement
letter dated
December 3,
2014
Facility
Agreement dated
December 12,
2014
To implement various road
projects and EPC orders
10,000.00 10,000.00 ICICI Bank
Base Rate +
1.40 %
Repayment
to be made
in 8 equal
quarterly
instalments
each
commencing
after
moratorium
period of 12
months from
the date of
first
disbursemen
t till the end
of 3 years.
8. Aditya Birla
Finance Limited
Rupee Term
Loan
Credit
arrangement
letter dated
September 30,
2015
Facility
Agreement dated
November 23,
2015
To refinance existing debt
and long term working
capital
9,000 Nil* HDFC base
rate +
Spread
(currently
11.00%)
Repayment
to be made
in 20
quarterly
unequal
instalments
each
commencing
after
moratorium
period of 6
months from
the date of
first
disbursemen
t till the end
of 5 years.
9. TATA Capital
Financial
Services Limited
Term Loan
Sanction letters
dated August 8,
2013
Term Loan
Agreement dated
September 7,
2013
For buying construction
equipments
1,500.00 471.27 LTLR minus
7.25%
Repayment
to be made
in quarterly
instalments
commencing
after
moratorium
period of
180 days
from the
date of first
disbursemen
t.
10. TATA Capital
Financial
Services Limited
Term Loan
For buying construction
equipments
1,200.00 753.22 LTLR minus
7.15%
Repayment
to be made
in quarterly
instalments
commencing
after
51
Sr.
No.
Name of the
lender, Type of
Loan and
documentation
Purpose
Amount
sanctioned
(` in Lacs)
Amount
outstanding
as on
November
30, 2015 (`
in Lacs)
Rate of
interest (per
annum)
Repayment
date /
schedule
Sanction letters
dated July 26,
2014
Term Loan
Agreement dated
August 8, 2014
moratorium
period of
180 days
from the
date of
disbursemen
t.
Total 52,690.00 34,322.26
* As per sanction letter and facility agreement, total outstanding loan from Aditya Birla Finance Limited to the Company
shall not exceed Rs. 17,750.00 Lacs (total of serial no. 7 and 8). As on November 30, 2015, Company has not drawn down
any amount under the sanctioned rupee term loan.
Details of term loans to be repaid by our Company
From the above mentioned working capital facilities, our Company proposes to utilize an estimated amount of `
2,111.37 lacs to repay following facility availed
Sr. No. Bank Total amount to be Repaid
(` in lacs)
1 Aditya Birla Finance Limited(1)
1,426.34
2 Yes Bank Limited(2)
468.37
3 Karur Vysya Bank(3)
178.87
4 TATA Capital Financial Service Limited (4)
37.78
Total 2,111.37 (1) For term loan availed from Aditya Birla Finance Limited please refer detail under serial no. 7 in above table (2) For term loan availed from Yes Bank Limited please refer detail under serial no. 2 in above table (3) For term loan availed from Karur Vysya Bank please refer detail under serial no. 3 in above table (4)For term loan availed from TATA Capital Financial Service Limited please refer detail under serial no. 9 and 10 in above
table
3. General Corporate Purposes
Our Board, will have flexibility in applying the balance amount towards general corporate purposes, subject to
such utilization not exceeding 25% of the Net Proceeds of the Issue, including, meeting our working capital
requirements, payment of penal interest or charges in relation to the repayment of the loans as disclosed above,
capital expenditure, funding our growth opportunities, including strategic initiatives, meeting expenses incurred
in the ordinary course of business including salaries and wages, rent, administration expenses, insurance related
expenses, repairs and maintenance, the payment of taxes and duties; meeting of exigencies which our Company
may face in course of business and any other purpose as may be approved by the Board or a duly appointed
committee from time to time, subject to compliance with the necessary provisions of the Companies Act.
Our Company’s management, in response to the competitive and dynamic nature of the industry, will have the
discretion to revise its business plan from time to time, and consequently, our funding requirement and
deployment of funds may also change. In accordance with the policies of our Board, our management will have
flexibility in utilizing the proceeds earmarked for General Corporate Purposes.
52
4. Estimated Issue related expenses
The Issue related expenses include, among others, fees to various advisors, printing and distribution expenses,
advertisement expenses, and registrar, depository fees, etc. The estimated Issue related expenses are as follows:
Sr.
No. Activity Expense
Amount
(in ` lacs)(1)
Percentage of
Total Estimated
Issue
Expenditure(1)
Percentage of
Issue Size(1)
1. Fees of the Lead Manager, legal
advisors, Registrar to the Issue,
auditor’s, including out of pocket
expenses
86.74 59.01% 0.58%
2. Expenses relating to advertising,
printing, distribution, marketing and
stationery expenses
15.05 10.24% 0.10%
3. Others (including SEBI Fees, Stock
Exchange Fees, etc.) 45.21 30.75% 0.30%
Total Estimated Issue Expenditure 147.00 100.00% 0.98%
(1) Assuming full subscription and Allotment of the Rights Equity Shares in the Issue.
Interim use of proceeds
Pending utilization for the objects described above, our Company, in accordance with the policies established by
our Board from time to time, will have the flexibility to deploy the Net Proceeds. Pending utilization for the
purposes described above, we intend to temporarily deposit the funds in the scheduled commercial banks
included in the second schedule of Reserve Bank of India Act, 1934 as may be approved by our Board of
Directors. We confirm that pending utilization of the Net Proceeds for the objects of the Issue, our Company
shall not utilize the Net Proceeds for any investment in the equity markets, real estate or related products.
Bridge Financing Facilities
Our Company has not availed any bridge loans from any bank or financial institution towards any of the stated
objects of the Issue as on the date of the Letter of Offer, which are proposed to be repaid from the Net Proceeds.
However, in the event, the Issue is not completed in the stipulated time frame, our Company may avail a short
term loan facility or a bridge loan to pay/ reduce the outstanding amounts in full or part under the loans
mentioned hereinabove. The Company will then utilize Net Proceeds to repay such short term loan facility or
bridge loan, if any.
Monitoring of Utilisation of Funds
Since the proceeds from the Issue are less than ` 50,000 lacs, in terms of Regulation 16(1) of the SEBI
Regulations, our Company is not required to appoint a monitoring agency for the purposes of this Issue. As
required under the SEBI Listing Regulations, the Audit Committee appointed by the Board shall monitor the
utilization of the proceeds of the Issue. We will disclose the details of the utilization of the Net Proceeds of the
Issue, including interim use, under a separate head in our financial statements specifying the purpose for which
such proceeds have been utilized or otherwise disclosed as per the disclosure requirements.
As per the requirements of Regulations 18 of the SEBI Listing Regulations, we will disclose to the audit
committee the uses/ applications of funds on a quarterly basis as part of our quarterly declaration of results.
Further, on an annual basis, we shall prepare a statement of funds utilized for purposes other than those stated in
the Letter of Offer and place it before the audit committee. The said disclosure shall be made till such time that
the gross proceeds raised through the Issue have been fully spent. The statement shall be certified by our
Auditors.
Further, in terms of Regulation 32 of the SEBI Listing Regulations, we will furnish to the Stock Exchanges on a
quarterly basis, a statement indicating material deviations, if any, in the use of proceeds from the objects stated
in the Letter of Offer. Further, this information shall be furnished to the Stock Exchanges along with the interim
or annual financial results submitted under Regulations 33 of the SEBI Listing Regulations and be published in
53
the newspapers simultaneously with the interim or annual financial results, after placing it before the audit
committee in terms of Regulation 18 of the SEBI Listing Regulations.
Appraising Entity
None of the objects of the Issue for which the Net Proceeds will be utilised have been appraised.
Other confirmations
Except for the repayment of loan to AREL, no part of the Issue Proceeds will be paid by us to the Promoter,
Promoter Group, the Directors, our key management personnel, associates or group companies, except in the
usual course of business.
54
SECTION IV –STATEMENT OF TAX BENEFITS
To
The Board of Directors
JMC PROJECTS (INDIA) LIMITED 6th Floor, Kalpataru Synergy,
Opp. Grand Hyatt, Santacruz (East),
Mumbai 400055
Maharashtra
Dear Sirs,
Sub: Statement of possible tax benefits available to JMC Projects (India) Limited (including its relevant
subsidiaries) and its shareholders
We hereby confirm that the enclosed annexure, prepared by JMC Projects (India) Limited (‘the Company’)
states the possible tax benefits available to the Company (including its relevant subsidiaries) and the
shareholders of the Company under the Income Tax Act, 1961 (‘Act’), the Wealth Tax Act, 1957) and the Gift
Tax Act, 1958, presently in force in India. Several of these benefits are dependent on the Company or its
shareholders fulfilling the conditions prescribed under the relevant provisions of the Act. Hence, the ability of
the Company or its shareholders to derive the tax benefits is dependent upon fulfilling such conditions, which
based on the business imperatives, the Company or its shareholders may or may not choose to fulfill.
The benefits discussed in the enclosed Annexure are not exhaustive and the preparation of the contents stated is
the responsibility of the Company’s management. We are informed that this statement is only intended to
provide general information to the investors and hence is neither designed nor intended to be a substitute for
professional tax advice. In view of the individual nature of the tax consequences, the changing tax laws, each
investor is advised to consult his or her own tax consultant with respect to the specific tax implications arising
out of their participation in the issue.
Our confirmation is based on the information, explanations and representations obtained from the Company and
on the basis of our understanding of the business activities and operations of the Company (including its
relevant subsidiaries). We do not express an opinion or provide any assurance as to whether:
► the Company or its shareholders will continue to obtain these benefits in future;
► the conditions prescribed for availing the benefits, where applicable have been/would be met with; and
► The revenue authorities/courts will concur with the views expressed herein
For Kishan M. Mehta & Co.
Chartered Accountants
Firm’s Registration No.: 105229W
Sd/-
Kishan M. Mehta
(Partner)
Membership No.: 13707
Place: Ahmedabad
Date: 23rd
December, 2015
55
ANNEXURE TO THE STATEMENT OF POSSIBLE TAX BENEFITS AVAILABLE TO THE
COMPANY (INCLUDING ITS RELEVANT SUBSIDIARIES) AND ITS SHAREHOLDERS UNDER
THE APPLICABLE LAWS IN INDIA
Outlined below are the possible benefits available to the Company (including its relevant subsidiaries) and its
shareholders under the current direct tax laws in India being Income Tax Act, 1961 (‘Act’), , the Wealth Tax
Act, 1957 and the Gift Tax Act, 1958,. Several of these benefits are dependent on the Company (including its
relevant subsidiaries) or its shareholders fulfilling the conditions prescribed under the relevant tax laws. Hence,
the ability of the Company (including its relevant subsidiaries) or its shareholders to derive the tax benefits is
dependent upon fulfilling such conditions, which based on business imperatives it faces in the future, it may not
choose to fulfil.
A. BENEFITS TO THE COMPANY (INCLUDING ITS RELEVANT SUBSIDIARIES) UNDER THE
ACT:
The Company will be entitled to deduction under the sections mentioned hereunder from its total income
chargeable to Income Tax.
1. Special tax benefit available to the Company (including its relevant subsidiaries)
Income arising from developing, operating and maintaining any infrastructure facility
As per the provisions of section 80-IA of the Act, the relevant subsidiaries of the Company are eligible to claim
a deduction to the extent of 100% of the profits derived from developing, or operating and maintaining or
developing, operating and maintaining any infrastructure facility,. Such deduction would be available for ten
consecutive assessment years. The benefit is available subject to fulfillment of prescribed conditions. However,
the aforesaid deduction is not available while computing tax liability of the relevant subsidiaries of the
Company under Minimum Alternative Tax (‘MAT’). Nonetheless, such MAT paid/payable on the book profits
of the relevant subsidiaries of the Company computed in terms of the provisions of Act, read with the
Companies Act, 1956* would be eligible for credit against tax liability arising under normal provisions of Act.
Further, such credit would not be allowed to be carried forward and set off beyond 10th assessment year
immediately succeeding the assessment year in which such credit becomes allowable.
2. General Tax Benefits available to the Company (including its relevant subsidiaries)
The following tax benefits are available to the Company (including its relevant subsidiaries) after fulfilling
conditions as per the respective provisions of the relevant tax laws.
(a) Business income
The Company and its relevant subsidiaries are entitled to claim depreciation on specified tangible and
intangible assets owned by them and used for the purpose of their business as per provisions of Section
32 of the Act. Business losses, if any, for an assessment year can be carried forward and set off against
business profits for eight subsequent years in terms of the provisions of section 72 of the Act.
Unabsorbed depreciation, if any, for an assessment year can be carried forward and set-off against any
source of income in subsequent years as per provisions of Section 32 of the Act for an indefinite
period.
* Currently, the corresponding provisions under the Companies Act, 2013 are in force. We understand that the
provisions regarding computation of net profit under the Companies Act 2013 are largely in line with that of the
Companies Act, 1956.
As per provisions of the Act, revenue expenditure of nature described under section 30 to 36 of Act and
any expenditure (not being capital or personal expenditure) being wholly and exclusively for the
purpose of business or profession, shall be allowed as deduction in computing the taxable income.
Under the provisions of Companies Act, 2013 certain companies are required to mandatorily spend 2%
of their average profits for corporate social responsibility (CSR) purposes. In this regard, it has been
clarified that such CSR expenditure incurred shall not be deemed to be expenditure for purposes of
business, and accordingly, would not be deductible while computing the taxable income. However, the
56
same will be allowed as a deduction if it is covered under a specific provision.
As per the provisions of Section 35D of the Act, any specified preliminary expenditure incurred by an
Indian company before commencement of business or after commencement of business in connection
with extension of an undertaking or setting up a new unit shall be allowed a deduction equivalent to
one-fifth of such expenditure for each of the five successive previous years beginning with the previous
year in which the business is commenced/ extended. However, any deduction in excess of 5% of cost
of project/ capital employed would be ignored.
As per the provisions of Section 35DD of the Act, any expenditure incurred by an Indian Company,
wholly and exclusively for the purpose of amalgamation/ demerger of an undertaking shall be allowed
as deduction to the extent of one-fifth of such expenditure for each of five successive previous years
beginning with the previous year in which the amalgamation/ demerger takes place.
As per the provisions of Section 72A of the Act, pursuant to business reorganisations (such as
amalgamation, demerger, etc), the successor company shall be allowed to carry forward any
accumulated tax losses/ unabsorbed depreciation of the predecessor company subject to fulfillment of
prescribed conditions.
(b) MAT credit
As per section 115JAA(1A) of the Act, credit is allowed in respect of tax paid under section 115JB of
the Act for any assessment year commencing on or after April 1, 2006.
MAT credit eligible to be carried forward will be the difference between MAT paid and the tax
computed as per the normal provisions of the Act for that assessment year. Such MAT credit is allowed
to be carried forward for set off purposes for upto ten assessment years immediately succeeding the
assessment year in which the MAT credit becomes allowable under section 115JAA(1A) of the Act.
MAT credit can be set off in a year when tax is payable under the normal provisions of the Act. MAT
credit to be allowed shall be the difference between MAT payable and the tax computed as per the
normal provisions of the Act for that assessment year.
(c) Capital gains
(i) Computation of capital gains
Capital assets are to be categorized into short-term capital assets and long-term capital assets based on
the period of holding. Capital assets, being shares held in a company or any other security (other than a
unit) listed in a recognized stock exchange in India or unit of an equity oriented fund, a zero coupon
bond or units of Unit Trust of India, held by an assessee for more than twelve months are considered to
be long-term capital assets, capital gains arising from the transfer of which are termed as long-term
capital gains (“LTCG”) and in respect of any other capital assets, the holding period should exceed
thirty-six months to be considered as long-term capital assets.
Short Term Capital Gains (“STCG”) means capital gains arising from the transfer of capital asset being
a share held in a company or any other security (other than a unit) listed in a recognized stock exchange
in India or unit of an equity oriented mutual fund, a zero coupon bond or units of Unit Trust of India,
held by an assessee for twelve months or less and in respect of any other capital assets, STCG means
capital gains arising from the transfer of an asset, held by an assessee for thirty-six months or less.
LTCG arising on transfer of equity shares of a company or units of an equity oriented fund as defined
which has been set up under a scheme of a mutual fund specified under Section 10(23D) is exempt
from tax as per provisions of Section 10(38) of the Act, provided the transaction is chargeable to
securities transaction tax (“STT”) and subject to conditions specified in that section. However, such
income shall be taken into account in computing book profit under section 115JB of the Act
As per provisions of Section 48 of the Act, LTCG arising on transfer of capital assets, other than bonds
and debentures (excluding capital indexed bonds issued by the Government) and depreciable assets, is
computed by deducting the indexed cost of acquisition and indexed cost of improvement from the full
value of consideration.
As per provisions of Section 112 of the Act, LTCG not exempt under Section 10(38) of the Act are
subject to tax at the rate of 20% with indexation benefits. However, if such tax payable on transfer of
listed securities (other than a unit) or units of an equity oriented mutual fund, zero coupon bonds or
units of Unit Trust of India exceeds 10% of the LTCG (without indexation benefit), the excess tax shall
be ignored for the purpose of computing the tax payable by, the assessee. No deduction under Chapter
57
VIA is allowed from such income.
As per provisions of Section 111A of the Act, STCG arising on sale of equity shares or units of an
equity oriented mutual fund [as defined which has been set up under a scheme of a mutual fund
specified under Section 10(23D)], are subject to tax at the rate of 15% provided the transaction is
chargeable to STT. No deduction under Chapter VIA is allowed from such income.
STCG arising on sale of equity shares or units of equity oriented mutual fund [as defined which has
been set up under a scheme of a mutual fund specified under Section 10(23D)], where such transaction
is not chargeable to STT is taxable at the rate of 30%.
The tax rates mentioned above stands increased by surcharge, payable at the rate of 7% where the
taxable income of a domestic company exceeds Rs 10,000,000. Such surcharge rate would stand
increased to 12% where the taxable income of the domestic company exceeds Rs 100,000,000. Further,
education cess and secondary and higher education cess on the tax on total income and surcharge at the
rate of 2% and 1% respectively is payable by all categories of taxpayers.
As per Section 50 of the Act, where a capital asset is forming part of a block of assets in respect of
which depreciation has been allowed under the Act, capital gains shall be computed in the following
manner:
o where full value of consideration on account of transfer of any asset forming part of block of asset,
as reduced by expenditure incurred wholly or exclusively in connection with transfer, exceeds the
written down value of block of assets and actual cost of assets acquired during the year, such
excess shall be deemed to be short term capital gains and taxed accordingly.
o where any block of assets ceases to exist, for the reason that all the assets in that block are
transferred, the difference between the consideration arising on result of transfer and the written
down value of block of assets and the actual cost of assets acquired during the year, shall be
deemed to be short term capital gains/(losses) and taxed accordingly.
As per provisions of Section 70 read with Section 74 of the Act, short term capital loss arising during a
year is allowed to be set-off against short term as well as long term capital gains. Balance loss, if any,
shall be carried forward and set-off against any capital gains arising during subsequent 8 assessment
years in terms of the provisions of section 74 of the Act .
As per provisions of Section 70 read with Section 74 of the Act, long term capital loss arising during a
year is allowed to be set-off only against long term capital gains. Balance loss, if any, shall be carried
forward and set-off against long term capital gains arising during subsequent 8 assessment years in
terms of the provisions of section 74 of the Act. Long term capital loss arising on sale of shares or units
of equity oriented fund subject to STT may not be carried forward for set off.
(ii) The Characterisation of the gain/losses, arising from sale/ transfer of shares/ units as business income or
capital gains would depend on the nature of holding and various other factors.
(iii) Exemption of capital gains u/s 54EC of the act.
As per section 54EC of the act, capital gains arising from transfer of long term capital assets shall be
exempt from tax, subject to the conditions and to the extent specified therein, if the capital gains are
invested within a period of six months from the date of transfer in the bonds (new bonds) redeemable
after three years and issued by:
National Highway Authority of India (“NHAI”) constituted under Section 3 of National Highway
Authority of India Act, 1988; and Rural Electrification Corporation Limited (“REC”), a company
formed and registered under the Companies Act, 1956.
Where a part of the capital gains is reinvested, the exemption is available on a proportionate basis. The
maximum investment in the specified long term asset cannot exceed Rs 5,000,000 per assessee during
any financial year in which the original asset is transferred and in the subsequent financial year..
Where the new bonds are transferred or converted into money within three years from the date of their
acquisition, the amount so exempt shall be taxable as capital gains in the year of transfer/ conversion.
(d) Securities Transaction Tax
As per provisions of Section 36(1)(xv) of the Act, STT paid in respect of the taxable securities
58
transactions entered into in the course of the business is allowed as a deduction if the income arising
from such taxable securities transactions is included in the income computed under the head 'Profit and
gains of business or profession'. Where such deduction is claimed, no further deduction in respect of
the said amount is allowed while determining the income chargeable to tax as capital gains.
(e) Dividends
As per provisions of Section 10(34) read with Section 115O of the Act, dividend (both interim and
final), if any, received by the Company on its investments in shares of another domestic company is
exempt from tax. The domestic company distributing dividends will be liable to pay dividend
distribution tax at the rate of 15% on grossed up basis on the total amount distributed as dividend. plus
a surcharge of 10% on the dividend distribution tax and education cess and secondary and higher
education cess of 2% and 1% respectively on the amount of dividend distribution tax and surcharge
thereon. The provisions with respect to grossing up of dividend to determine the dividend distribution
tax payable are applicable from October 1st 2014.
As per provisions of Section 14A of the Act, expenditure incurred to earn an exempt income is not
allowed as deduction while determining taxable income. The quantum of such expenditure liable for
disallowance is to be computed in accordance with the provisions contained therein.
Further, if the company being a holding company, has received any dividend from its subsidiary on
which dividend distribution tax has been paid by such subsidiary, then for the same year, the company
will not be required to pay dividend distribution tax to the extent the same has been paid by such
subsidiary company.
As per provisions of Section 10(35) of the Act, income received in respect of units of a mutual fund
specified under Section 10(23D) of the Act (other than income arising from transfer of such units) is
exempt from tax.
As per the provisions of Section 115BBD of the Act, dividend received by an Indian company from a
specified foreign company (in which it has shareholding of 26% or more) would be taxable at the
concessional rate of 15% on gross basis (excluding surcharge and education cess).
For removing the cascading effect of dividend distribution tax, while computing the amount of
dividend distribution tax payable by a domestic company u/s 115O of the Act, the dividend received
from a foreign subsidiary on which income-tax has been paid by the domestic company under Section
115BBD of the Act shall be reduced.
(f) Buy-back of shares
As per the provisions of Section 10(34A) of the Act, any income arising to shareholders on account of
buy-back of unlisted shares, shall be exempt in the hands of the shareholders. This exemption is
available to shareholders only in case where the company pays buy back tax under the provisions of
section 115QA of the Act.
Such income is also exempt from tax while computing book profit for the purpose of determination of
MAT liability. However, in case of buy back of listed securities, it will be liable to capital gains tax.
(g) Tax on distributed profits of domestic companies
As per provisions of section 115-O of the Act, tax on distributed profits of domestic companies is
chargeable at 15% on grossed up basis (grossing up being applicable from October 1st 2014) on the
total amount distributed as dividend (plus applicable surcharge, education cess and higher education
cess). As per sub-section (1A) to section 115-O, the domestic Company will be allowed to set-off the
dividend received from its subsidiary company during the financial year against the dividend
distributed by it, while computing the Dividend Distribution Tax (DDT) if:
o the dividend is received from its domestic subsidiary and the subsidiary has paid the DDT payable
on such dividend; or
o the dividend is received from a foreign subsidiary, the Company has paid tax payable under
section 115BBD.
However, the same amount of dividend shall not be taken into account for reduction more than once.
59
(h) Other Provisions
As per provisions of Section 80G of the Act, the assessee is entitled to claim deduction of a specified
amount in respect of eligible donations, subject to the fulfillment of the conditions specified in that
section.
As per provisions of Section 80GGB of the Act, the assessee is entitled to claim deduction amounting
to 100% of any sum contributed to any political party or an electoral trust.
B. Benefits available to the Resident members/ shareholders of the Company under the Act
(a) Dividends exempt under section 10(34)
As per provisions of Section 10(34) of the Act, dividend (both interim and final), if any, received by
the resident members/ shareholders from a domestic company is exempt from tax. The domestic
company will be liable to pay dividend distribution tax at the rate of 15% on grossed up basis (grossing
up being applicable from October 1st 2014) thereon on the total amount distributed as dividend. plus a
surcharge of 10% on the dividend distribution tax and education cess and secondary & higher
education cess of 2% and 1% respectively on the amount of dividend distribution tax and surcharge
thereon. .
As per provisions of Section 14A of the Act, expenditure incurred to earn an exempt income is not
allowed as deduction while determining taxable income. The quantum of such expenditure liable for
disallowance is to be computed in accordance with the provisions contained therein.
(b) Capital gains
Computation of capital gains
Capital assets are to be categorized into short-term capital assets and long-term capital assets based on
the period of holding. Capital assets, being shares held in a company or any other security (other than a
unit) listed in a recognized stock exchange in India or unit of an equity oriented mutual fund, a zero
coupon bond or units of Unit Trust of India, held by an assesse for more than twelve months are
considered to be long-term capital assets, capital gains arising from the transfer of which are termed as
LTCG and in respect of any other capital assets, the holding period should exceed thirtysix months to
be considered as long-term capital assets.
STCG means capital gains arising from the transfer of capital asset being a share held in a company or
any other security(other than a unit) listed in a recognized stock exchange in India or unit of an equity
oriented mutual fund, a zero coupon bonds or units of Unit Trust of India, held by an assessee for
twelve months or less and in respect of any other capital assets. STCG means capital gains arising
from the transfer of an asset, held by an assessee for thirty-six months or less.
LTCG arising on transfer of equity shares of a company or units of an equity oriented fund [as defined
which has been set up under a scheme of a mutual fund specified under Section 10(23D)] is exempt
from tax as per provisions of Section 10(38) of the Act, provided the transaction is chargeable to STT
and subject to conditions specified in that section.
As per the amendment to Chapter VII of Finance Act (No 2) of 2004, sale of unlisted equity shares
under an offer for sale to the public which are included in an initial public offer and where such shares
are subsequently listed on a recognized stock exchange, the same would be covered within the ambit of
taxable securities transaction under the aforesaid Chapter. Accordingly, STT is leviable on sale of
shares under an offer for sale to the public in an initial public offer and the LTCG arising on transfer of
such shares would be exempt from tax as per provisions of Section 10(38) of the Act.
As per provisions of Section 48 of the Act, LTCG arising on transfer of capital assets, other than bonds
and debentures (excluding capital indexed bonds issued by the Government) and depreciable assets, is
computed by deducting the indexed cost of acquisition and indexed cost of improvement from the full
value of consideration.
As per provisions of Section 112 of the Act, LTCG not exempt under Section 10(38) of the Act are
subject to tax at the rate of 20% with indexation benefits. However, if such tax payable on transfer of
listed securities or units of an equity oriented mutual fund, zero coupon bonds or units of Unit Trust of
India exceed 10% of the LTCG (without indexation benefit), the excess tax shall be ignored for the
60
purpose of computing the tax payable by the assesse. No deduction under Chapter VIA is allowed from
such income.
As per provisions of Section 111A of the Act, STCG arising on sale of equity shares or units of equity
oriented mutual fund [as defined which has been set up under a scheme of a mutual fund specified
under Section 10(23D)], are subject to tax at the rate of 15% provided the transaction is chargeable to
STT. No deduction under Chapter VIA is allowed from such income.
STCG arising on sale of equity shares or units of equity oriented mutual fund [as defined which has
been set up under a scheme of a mutual fund specified under Section 10(23D)], where such transaction
is not chargeable to STT, is taxable at the rate of 30% in case of domestic company and at normal slab
rates in case of other assessees.
As per the provisions of Section 10(34A) of the Act, any income arising to shareholders on account of
buy-back of unlisted shares, shall be exempt in the hands of the shareholders. This exemption is
available to shareholders only in case where the company pays buy back tax under the provisions of
section 115QA of the Act.
The tax rates mentioned above stands increased by surcharge, payable at the rate of 7% where the
taxable income of a domestic company exceeds Rs 10,000,000. Such surcharge rate would stand
increased to 12% where the taxable income of the domestic company exceeds Rs 100,000,000. Further,
education cess and secondary and higher education cess on the tax on total income and surcharge at the
rate of 2% and 1% respectively is payable by all categories of taxpayers.
In the case of a taxpayer other than domestic companies, the tax rates mentioned above stands
increased by a surcharge, payable at the rate of 12% where the taxable income of the taxpayer exceeds
Rs. 10,000,000. Further, education cess and secondary and higher education cess on the total income at
the rate of 2% and 1% respectively is payable.
As per provisions of Section 70 read with Section 74 of the Act, short term capital loss arising during a
year is allowed to be set-off against short term as well as long term capital gains. Balance loss, if any,
shall be carried forward and set-off against any capital gains arising during subsequent 8 assessment
years in terms of the provisions of section 74 of the Act.
As per provisions of Section 70 read with Section 74 of the Act, long term capital loss arising during a
year is allowed to be set-off only against long term capital gains. Balance loss, if any, shall be carried
forward and set-off against long term capital gains arising during subsequent 8 assessment years in
terms of the provisions of section 74 of the Act.
Exemption of capital gains u/s 54EC of the act.
Capital gains arising from transfer of long term capital assets shall be exempt from tax, subject to the
conditions and to the extent specified therein, if the capital gains are invested within a period of six
months from the date of transfer in the bonds (new bonds) issued by NHAI and REC redeemable after
three years:
Where a part of the capital gains is reinvested, the exemption is available on a proportionate basis. The
maximum investment in the specified long term asset cannot exceed Rs 5,000,000 per assessee during
any financial year in which the original asset is transferred and in the subsequent financial year..
Where the new bonds are transferred or converted into money within three years from the date of their
acquisition, the amount so exempt shall be taxable as capital gains in the year of transfer/ conversion.
As per provisions of Section 54F of the Act, in case of an individual or a Hindu Undivided Family,
LTCG arising from transfer of shares is exempt from tax if the net consideration from such transfer is
utilized within a period of one year before, or two years after the date of transfer for purchase of one
residential house, or within a period of three years from the date of transfer for construction of one
residential house subject to conditions and to the extent specified therein.
c. Other Provisions
As per provisions of Section 56(2)(vii) of the Act and subject to exception provided in second proviso
therein, where an individual or HUF receives shares and securities without consideration or for a
consideration which is less than the aggregate fair market value of the shares and securities by an
amount exceeding fifty thousand rupees, the excess of fair market value of such shares and securities
over the said consideration is chargeable to tax under the head 'income from other sources'. However,
61
the said section is not applicable in case the shares and securities are received under instances specified
under the second proviso thereon.
The characterization of the gain/ losses, arising from sale/ transfer of shares as business income or
capital gains would depend on the nature of holding and various other factors.
C. Benefits available to the Non-resident shareholders of the Company under the Act
a. Dividends exempt under section 10(34)
As per provisions of Section 10(34) of the Act, dividend (both interim and final), if any, received by
non-resident shareholders from the domestic company is exempt from tax. The domestic company will
be liable to pay dividend distribution tax at the rate of 15% on grossed up basis (grossing up being
applicable from October 1st 2014) on the total amount distributed as dividend plus a surcharge of 10%
on the dividend distribution tax and education cess and secondary and higher education cess of 2% and
1% respectively on the amount of dividend distribution tax and surcharge thereon.
b. Capital gains
Computation of capital gains
Capital assets are to be categorized into short-term capital assets and long-term capital assets based on
the period of holding. Capital assets, being shares held in a company or any other security (other than a
unit) listed in a recognized stock exchange in India or unit of an equity oriented mutual fund, a zero
coupon bond or units of Unit Trust of India, held by an assesse for more than twelve months are
considered to be long-term capital assets, capital gains arising from the transfer of which are termed as
LTCG and in respect of any other capital assets, the holding period should exceed thirtysix months to
be considered as long-term capital assets.
STCG means capital gains arising from the transfer of capital asset being a share held in a company or
any other security listed in a recognized stock exchange in India or unit of an equity oriented mutual
fund, a zero coupon bonds held by an assessee or units of Unit Trust of India for twelve months or less
and in respect of any other capital assets, STCG means capital gains arising from the transfer of an
asset, held by an assessee for thirty-six months or less.
LTCG arising on transfer of equity shares of a company or units of an equity oriented fund [as defined
which has been set up under a scheme of a mutual fund specified under Section 10(23D)] is exempt
from tax as per provisions of Section 10(38) of the Act, provided the transaction is chargeable to STT
and subject to conditions specified in that section.
As per the amendment to Chapter VII of Finance Act (No 2) of 2004 sale of unlisted equity shares
under an offer for sale to the public which are included in an initial public offer and where such shares
are subsequently listed on a recognized stock exchange, the same would be covered within the ambit of
taxable securities transaction under the aforesaid Chapter. Accordingly, STT is leviable on sale of
shares under an offer for sale to the public in an initial public offer and the LTCG arising on transfer of
such shares would be exempt from tax as per provisions of Section 10(38) of the Act.
As per provisions of Section 112 of the Act, LTCG arising out of listed securities not exempt under
Section 10(38) of the Act are subject to tax at the rate of 20% with indexation benefits. The indexation
benefits are however not available in case the shares are acquired in foreign currency. In such a case,
the capital gains shall be computed in the manner prescribed under the first proviso to Section 48. As
per first proviso to Section 48 of the Act, where the shares have been purchased in foreign currency by
a nonresident, the capital gains arising on transfer need to be computed by converting the Cost of
acquisition, expenditure incurred in connection with such transfer and full value of the consideration
received or accruing as a result of the transfer, into the same foreign currency in which the shares were
originally purchased, the resultant gains thereafter need to be reconverted into Indian currency. The
conversion needs to be at the prescribed rates prevailing on dates stipulated. If the tax payable on
transfer of listed securities exceeds 10% of the LTCG, the excess tax shall be ignored for the purpose
of computing tax payable by the assesse.
Further, LTCG arising from transfer of unlisted securities (other than by way of offer for sale under an
initial public offer) is chargeable to tax at 10% without indexation and foreign exchange fluctuation
62
benefits. No deduction under Chapter VIA is allowed from such income.
As per provisions of Section 111A of the Act, STCG arising on sale of equity shares or units of equity
oriented mutual fund [as defined which has been set up under a scheme of a mutual fund specified
under Section 10(23D)], are subject to tax at the rate of 15% provided the transaction is chargeable to
STT. No deduction under Chapter VIA is allowed from such income.
STCG arising on sale of equity shares or units of equity oriented mutual fund [as defined which has
been set up under a scheme of a mutual fund specified under Section 10(23D)], where such transaction
is not chargeable to STT is taxable at the normal rates of taxation as applicable to the taxpayer.
As per the provisions of Section 10(34A) of the Act, any income arising to shareholders on account of
buy-back of unlisted shares, shall be exempt in the hands of the shareholders. This exemption is
available to shareholders only in case where the company pays buy back tax under the provisions of
section 115QA of the Act.
The tax rates mentioned above stands increased by surcharge, payable at the rate of 2% where the
taxable income of a foreign company exceeds Rs 10,000,000. Such surcharge rate would stand
increased to 5% where the taxable income of the domestic company exceeds Rs 100,000,000.
Further, education cess and secondary and higher education cess on the tax on total income and
surcharge at the rate of 2% and 1% respectively is payable by all categories of taxpayers.
As per provisions of Section 70 read with Section 74 of the Act, short term capital loss arising during a
year is allowed to be set-off against short term as well as long term capital gains. Balance loss, if any,
shall be carried forward and set-off against any capital gains arising during subsequent eight
assessment years in terms of the provisions of section 74 of the Act.
As per provisions of Section 70 read with Section 74 of the Act, long term capital loss arising during a
year is allowed to be set-off only against long term capital gains. Balance loss, if any, shall be carried
forward and set-off against long term capital gains arising during subsequent eight assessment years in
terms of the provisions of section 74 of the Act.
Exemption of capital gains from income-tax
capital gains arising from transfer of long term capital assets shall be exempt from tax, subject to the
conditions and to the extent specified therein, if the capital gains are invested within a period of six
months from the date of transfer in the bonds (new bonds) issued by NHAI and REC redeemable after
three years:
Where a part of the capital gains is reinvested, the exemption is available on a proportionate basis. The
maximum investment in the specified long term asset cannot exceed Rs 5,000,000 per assessee during
any financial year in which the original asset is transferred and in the subsequent financial year.
Where the new bonds are transferred or converted into money within three years from the date of their
acquisition, the amount so exempt shall be taxable as capital gains in the year of transfer/ conversion.
As per provisions of Section 14A of the Act, expenditure incurred to earn an exempt income is not
allowed as deduction while determining taxable income. The quantum of such expenditure liable for
disallowance is to be computed in accordance with the provisions contained therein.
The characterization of the gain/ losses, arising from sale / transfer of shares as business income or
capital gains would depend on the nature of holding and various other factors.
As per provisions of Section 54F of the Act in case of an individual or a Hindu Undivided Family,
LTCG arising from transfer of shares is exempt from tax if the net consideration from such transfer is
utilized within a period of one year before, or two years after the date of transfer, for purchase of one
residential house, or within a period of three years from the date of transfer for construction of one
residential house subject to conditions and to the extent specified therein.
c. Other Provisions
As per provisions of Section 56(2)(vii) of the Act and subject to exception provided in second proviso
therein, where an individual or HUF receives shares and securities without consideration or for a
consideration which is less than the aggregate fair market value of the shares and securities by an
amount exceeding fifty thousand rupees, the excess of fair market value of such shares and securities
over the said consideration is chargeable to tax under the head ‘income from other sources'. However,
63
the said section is not applicable in case the shares and securities are received under instances specified
under the second proviso thereon.
As per provisions of Section 194LC of the Act, any interest income to non-residents under a loan
agreement with an Indian company approved by the central government arising between July 1st 2012
and July 1st 2017, would be subject to tax at 5%.
Further, as per provisions of Section 194LC of the Act, any interest income to non-residents on
investment made in any long term infrastructure bond of an Indian company approved by the central
government arising between July 1st 2012 and July 1st 2017, and on investment made in any other long
term bond of an Indian company approved by the Central Government arising between October 1st
2014 and July 1st 2017, would be subject to tax at 5%.
d. Tax Treaty benefits
As per provisions of Section 90(2) of the Act, non-resident shareholders can opt to be taxed in India as
per the provisions of the Act or the double taxation avoidance agreement entered into by the
Government of India with the country of residence of the non-resident shareholder, whichever is more
beneficial. It needs to be noted that a non-resident is required to hold a valid tax residency certificate
containing the particulars prescribed under Notification No. 57 of 2013 dated 1 August 2013 issued by
the Central Board of Direct Taxes in order to claim benefits under the applicable tax treaty.
e. Taxation of Non-resident Indians
Special provisions in case of Non-Resident Indian (“NRI”) in respect of income/ LTCG from specified
foreign exchange assets under Chapter XII-A of the Act are as follows:
o NRI means a citizen of India or a person of Indian origin who is not a resident. A person is deemed
to be of Indian origin if he, or either of his parents or any of his grandparents, were born in
undivided India.
o Specified foreign exchange assets include shares of an Indian company which are acquired/
purchased/ subscribed by NRI in convertible foreign exchange.
o As per provisions of Section 115E of the Act, LTCG arising to a NRI from transfer of specified
foreign exchange assets is taxable at the rate of 10%
o As per provisions of Section 115E of the Act, income [other than dividend which is exempt under
Section 10(34)] from investments and LTCG [other than gain exempt under Section 10(38)] from
assets (other than specified foreign exchange assets) arising to a NRI is taxable at the rate of 20%.
No deduction is allowed from such income in respect of any expenditure or allowance or
deductions under Chapter VI-A of the Act.
o As per the provisions of Section 115F of the Act, LTCG arising to a NRI on transfer of a foreign
exchange asset is exempt from tax if the net consideration from such transfer is invested in the
specified assets or savings certificates within six months from the date of such transfer, subject to
the extent and conditions specified in that section. If part of such net consideration is invested
within the prescribed period of six months in any specified asset the exemption will be allowed on
a proportionate basis.
o As per the provisions of Section 115G of the Act, where the total income of a NRI consists only of
investment income and/or LTCG from foreign exchange asset and tax thereon has been deducted
at source in accordance with the Act, the NRI is not required to file a return of income.
o As per provisions of Section 115H of the Act, where a person who is a NRI in any previous year,
becomes assessable as a resident in India in respect of the total income of any subsequent year, he/
she may furnish a declaration in writing to the assessing officer, along with his / her return of
income under Section 139 of the Act for the assessment year in which he/ she is first assessable as
a resident, to the effect that the provisions of the Chapter XII-A shall continue to apply to him/ her
in relation to investment income derived from the specified assets mentioned in Section 115H of
the Act for that year and subsequent years until such assets are transferred or converted into
money.
o As per provisions of Section 115-I of the Act, a NRI can opt not to be governed by the provisions
64
of Chapter XII-A for any assessment year by furnishing return of income for that assessment year
under Section 139 of the Act, declaring therein that the provisions of the chapter shall not apply for
that assessment year and accordingly his/her total income for that assessment year will be
computed in accordance with the other provisions of the Act.
o As per the provisions of Section 10(34A) of the Act, any income arising to shareholders on
account of buy-back of unlisted shares shall be exempt in the hands of the shareholders. This
exemption is available to shareholders only in case where the company pays buy back tax under
the provisions of section 115QA of the Act.
D. Benefits available to Foreign Institutional Investors (“FIIs") under the Act
a. Dividends exempt under section 10(34)
As per provisions of Section 10(34) of the Act, dividend (both interim and final), if any, received by a
shareholder from a domestic Company is exempt from tax. The domestic Company will be liable to
pay dividend distribution tax at the rate of 15% on grossed up basis (grossing up being applicable from
October 1st 2014) on the total amount distributed as dividend plus a surcharge of 10% on the dividend
distribution tax and education cess and secondary and higher education cess of 2% and 1% respectively
on the amount of dividend distribution tax and surcharge thereon.
b. Long-term capital gains exempt under section 10(38) of the Act
LTCG arising on sale of equity shares of a company subjected to STT is exempt from tax as per
provisions of Section 10(38) of the Act.
It is pertinent to note that as per provisions of Section 14A of the Act, expenditure incurred to earn an
exempt income is not allowed as deduction while determining taxable income. The quantum of such
expenditure liable for disallowance is to be computed in accordance with the provisions contained
therein.
c. Capital gains
As per provisions of Section 115AD of the Act, income (other than income by way of dividends
referred to Section 115O) received in respect of securities (other than units referred to in Section
115AB) is taxable at the rate of 20% (plus applicable surcharge and education cess and secondary &
higher education cess). No deduction is allowed from such income in respect of any expenditure or
allowance or deductions under Chapter VI-A of the Act.
As per provisions of Section 115AD of the Act, capital gains arising from transfer of securities is
taxable as follows:
Nature of Income
Rate of tax (%) (plus applicable surcharge,
education cess and secondary and higher
education cess)
LTCG on sale of equity shares not subjected to STT
(without cost indexation)
10
STCG on sale of equity shares subjected to STT 15
STCG on sale of equity shares not subjected to STT 30
As per provisions of 196D of the Act, taxes shall not be withheld from any income in the nature of
capital gains arising to FIIs from transfer of securities specified in Section 115AD of the Act. Further,
capital gains arising on transfer of other securities would be subject to withholding tax at the rate of
20%.
As per provisions of the section 194LD of the Act, any interest income arising to FIIs in respect of
investment in rupee denominated bonds of an Indian company or a Government security between 1
June 2013 and 1 June 2017 would be subject to tax at 5%.
For corporate FIIs, the tax rates mentioned above stands increased by a surcharge, payable at the rate of
2% where the taxable income exceeds Rs 10,000,000. Such surcharge would stand increased to 5%
65
where the taxable income exceeds Rs 100,000,000. Further, education cess and secondary and higher
education cess on thetax on total income and surcharge at the rate of 2% and 1% respectively is
payable.
The benefit of exemption under Section 54EC of the Act mentioned above in case of the Company is
also available to FIIs.
As per the provisions of Section 10(34A) of the Act, any income arising to shareholders on account of
buy-back of unlisted shares shall be exempt in the hands of the shareholders. This exemption is
available to shareholders only in case where the company pays buy back tax under the provisions of
section 115QA of the Act.
d. Securities Transaction Tax (S.T.T.)
As per provisions of Section 36(1)(xv) of the Act, STT paid in respect of the taxable securities
transactions entered into in the course of the business is allowed as a deduction if the income arising
from such taxable securities transactions is included in the income computed under the head ‘Profit and
gains of business or profession'. Where such deduction is claimed, no further deduction in respect of
the said amount is allowed while determining the income chargeable to tax as capital gains.
e. Tax Treaty benefits
As per provisions of Section 90(2) of the Act, FIIs can opt to be taxed in India as per the provisions of
the Act or the double taxation avoidance agreement entered into by the Government of India with the
country of residence of the FII, whichever is more beneficial. It needs to be noted that a non-resident is
required to hold a valid tax residency certificate containing the particulars prescribed under
Notification No. 57 of 2013 dated 1 August 2013 issued by the Central Board of Direct Taxes in order
to claim benefits under the applicable tax treaty.
The characterization of the gain/ losses, arising from sale/transfer of shares has been clarified to be in
the nature of capital gains.
E. Benefits available to Venture Capital Companies/ Funds under the Act
In terms of section 10(23FB) of the Act, all Venture capital companies/funds registered with Securities
and Exchange Board of India, subject to the conditions specified, are eligible for exemption from
income tax on all their income from investments, including profit on sale of shares of the Company but
excluding income of an investment fund specified in section 115UB of the Act.
F. Benefits available to Mutual Funds
As per the provisions of Section 10(23D) of the Act, any income of Mutual Funds registered under the
Securities and Exchange Board of India Act, 1992 or Regulations made there under, Mutual Funds set
up by public sector banks or public financial institutions or authorized by the Reserve Bank of India
would be exempt from income tax. However, the Mutual Funds shall be liable to pay tax on distributed
income to unit holders under Section 115R of the Act.
G. Wealth tax Act, 1957
Wealth tax is not leviable on net wealth commencing from financial year on and after 1st April, 2015 .
H. Gift Tax Act, 1958
Gift tax is not leviable in respect of any gifts made on or after October 1, 1998.
Notes:
All the above benefits are as per the current tax laws and will be available only to the sole/ first name holder
where the shares are held by joint holders.
In view of the individual nature of tax consequences, each investor is advised to consult his/her own tax
66
advisor with respect to specific tax consequences of his/her participation in the scheme.
We have not commented on the taxation aspect under any law for the time being in force, as applicable, of
any country other than India. Each investor is advised to consult its own tax consultant for taxation in any
country other than India.
67
SECTION V -OUR MANAGEMENT
Board of Directors
Under our Articles of Association, our Company is required to have not less than 3 Directors and unless
otherwise determined by our Company in a General Meeting not more than fifteen Directors, subject to the
Companies Act.
Currently, our Company has 8 Directors out of which 3 are Independent Directors. The composition of the
Board of Directors is governed by the provisions of the Companies Act and the SEBI Listing Regulations and
Uniform Listing Agreement and the norms of the code of corporate governance as applicable to listed
companies in India.
Name, Designation, Occupation,
DIN, Address and Term Nationality
Age
(Years) Other Directorships
Mr. Devendra Raj Mehta
Designation: Chairman & Independent
Director
Occupation: Retired / social service
DIN: 01067895
Address: B - 5 Mahavir Udyan Marg
Bajaj Nagar, Jaipur-302015, Rajasthan,
India
Term: 5years till September 26, 2019
Indian 78 1. Poly Medicure Limited
2. Jain Irrigation Systems Limited
3. Atul Rajasthan Date Palms
Limited
4. Glenmark Pharmaceuticals
Limited
5. MM Auto Industries Limited
6. M N M Assets Reconstruction
Company Limited
7. Ashray Homes Buildwell Private
Limited
Mr. Shailendra Kumar Tripathi
Designation: Chief Executive Officer
& Deputy Managing Director
Occupation: Service
DIN: 03156123
Address: Flat no.21, Building no.4A,
Kalpataru estate Poonam nagar, near
Majas Depot, Andheri (E) Mumbai-
400093, Maharashtra India
Term: 5 years till October 21, 2016.
Indian 51 NIL
Mr. Shailendra Raj Mehta
Designation: Non - Executive &
Independent Director
Occupation: Service
DIN: 02132246
Address: T-24 Faculty Block, IIM
Ahmedabad,Vastrapur, Ahmedabad-
380015.Gujarat ,India
Indian 56 1.ARC Associates Private Limited
2. Poly Medicure Limited.
68
Name, Designation, Occupation,
DIN, Address and Term Nationality
Age
(Years) Other Directorships
Term: 5 years till September 26, 2019
Mr. Mehandra Gulabrai Punatar
Designation: Non-Executive &
Independent Director
Occupation: Service
DIN: 00533198
Address: 1302, 13th floor, Raheja
Majestic, near Starcity Theatre,
Manmala Road, Matunga (West)
Mumbai-400010, Maharashtra, India
Term: 5years till September 26, 2019
Indian 80 1. Kalpataru Power Transmission
Limited
Mr. Hemant Ishwarlal Modi
Designation:Non-Executive Director
Occupation: Business
DIN: 00171161
Address: 363/A Lane 18, Satyagrah
Chhavni, Satellite, Ahmedabad-
380015, Gujarat, India
Term: Liable to retire by rotation
Indian 60 1. SAI Consulting Engineers Private
Limited
2. JMC Infrastructure Limited
3. JMC Mining and Quarries
Limited
Ms. Anjali Karamnarayan Seth
Designation:Non-Executive Director
Occupation: professional /lawyer
DIN: 05234352
Address: Flat No : B 1301, Brichwood
C-H-S Ltd, Main Street Hiranandani
Gardens, Powai, Mumbai-400076,
Maharashtra, India
Term: Liable to retire by rotation
Indian 57 1. Adlabs Entertainment Limited
2. Caprihans (India) Limited
3. Walkwater Properties Private
Limited
4. ADF Foods Limited
5. Kalpataru Limited
6. Kalpataru Power Transmission
Limited
Mr. Manish Dashrathmal Mohnot
Designation: Non-Executive Director
Occupation: Service
DIN: 01229696
Address: C/4/11, Sunder Nagar, S.V.
Road, Malad (W) Mumbai-400064,
Maharashtra, India
Indian 43 1. Kalpataru Power Transmission
Limited
2. Shree Shubham Logistics Limited
3. Adeshwar Infrabuild Limited
4. Amber Real Estate Limited
5. Saicharan Properties Limited
6. Kalpataru SA(Pty) Limited
7. Kalpataru Power Transmission
Nigeria Limited
8. Kalpataru Power Transmission
USA INC
69
Name, Designation, Occupation,
DIN, Address and Term Nationality
Age
(Years) Other Directorships
Term: Not Liable to retire by rotation.
Mr. Kamal Kishore Jain
Designation: Non-Executive Director
Occupation: Service
DIN: 00269810
Address: “Madhupark”, Plot No.110,
Near Shopping Centre , Sector-8,
Gandhinagar- 382008, Gujarat, India)
Term: Not Liable to retire by rotation.
Indian 58 1. Energylink (India) Limited
2. JMC mining and quarries Limited
3. Shree Shubham Logistics Limited
4. Adeshwar Infrabuild Limited
5. Jhajjar KT Transco Private
Limited
6. Gestamp Kalpataru Solar Steel
Structures Private Limited
7. Amber Real Estate Limited
8. Saicharan Properties Limited
9. Kalpataru Satpura Transco
Private Limited
10. Punarvasu Holding and Trading
Company Private Limited
Relationship between Directors
None of the Directors are related to each other as per the provisions of the Companies Act, 2013.
Brief Profile of our Directors
Mr. Devendra Raj Mehta
Mr. Devendra Raj Mehta, aged 78 years, is the Chairman and Independent Director of our Company. Mr. Mehta
holds degree of Bachelor of Arts, Bachelor of Law and Management Graduate of Royal Institute of Public
Administration, London and Alfred Sloan & School of Management MIT-Boston, USA. He joined the Indian
Administrative Service in 1961. He has experience of more than 40 years during which he held various
important positions in Government of Rajasthan, Government of India and also in Regulatory Bodies. He was
the Deputy Governor of Reserve Bank of India (RBI) and Chairman of Securities and Exchange Board of India.
Mr. Shailendra Kumar Tripathi
Mr. Shailendra Kumar Tripathi, aged 51 years, is the Chief Executive Officer and Deputy Managing Director of
our Company. Mr. Tripathi holds a bachelor’s degree in civil engineering from Rani Durgavati
Vishwavidhyalaya, Jabalpur. He has worked in major Infrastructure companies like Gammon India, Larsen &
Toubro Limited and Oriental Structural Engineers Private Limited.
Mr. Shailendra Raj Mehta
Mr. Shailendra Mehta, aged 56 years, is a Non-Executive Independent Director of our Company. Mr. Mehta
holds a bachelor’s degree in arts from Delhi University and Master’s degree in Arts from Delhi University,
Masters of Philosophy from Oxford University and holds Doctorate of Philosophy in Economics from Harvard
University. He is currently the Chairman of the Board of Management of Auro University and also a
Distinguished Professor of Strategy. Prior to joining Auro University, he was Provost and Vice Chancellor of
Ahmedabad University.Prior to that Mr. Mehta was a visiting professor of business policy at the Indian Institute
of Management, Ahmedabad. He has also done research in the areas of enterpreneurship, industrial organisation,
information economics and experimental economics. His research was the subject of a full-length review by The
Economist. He has been associated with reputed organizations such as IBM, Honeywell, Microsoft, Infosys,
State Bank of India and others. He taught economics and strategy for many years at Purdue University at US.
Mr. Mahendra Gulabrai Punatar
Mr. Mahendra Gulabrai Punatar, aged 80 years, is a Non-Executive Independent Director of our Company. He
70
holds a bachelor's degree in Civil Engineering and Master's degree in structural engineering from
U.S.A. He has over 50 years of experience in the field of construction industry.
Mr. Hemant Modi
Mr. Hemant Modi, aged 60 years, is a Non-Executive Director of our Company. He holds Master’s degree in
science from Rutgers, the State University and a bachelor's degree in civil engineering from The Maharaja
Sayajirao, University of Baroda. He has 29 years of experience in the field of management and execution of
construction of Industrial structures and factory buildings. Mr. Modi is responsible for successful execution of
all projects undertaken by our Company. Mr. Modi is personally involved in the projects to ensure highest
quality service to the clients. He is one of the founders of our Company.
Ms. Anjali Karamnarayan Seth
Ms. Anjali Karamnarayan Seth, aged 57 years, is a Non-Executive Director of our Company. Ms. Seth holds
bachelor’s degree in Law from University of Delhi. She provides various advisory and consultancy services to
banks, financial institutions and corporates as a legal consultant. She has a rich and diverse experience of over
25 years in the field of law. She is associated with various companies which includes International Finance
Corporation, Swaadhar Finserve and ANZ Grindlays Bank. She had the opportunity to work in UAE with real-
estate company, Emmar Properties. Ms. Seth served with Standard Chartered Bank as their Legal Head in India.
Mr. Manish Dashrathmal Mohnot
Mr. Manish Mohnot, aged 43 years, is a non-executive Director of our Company. Mr. Mohnot is a chartered
accountant, and a certified SAP R/3 application consultant (accounting and controlling). He has completed an
advanced management program from the Harvard Business School. He has about 20 years of experience in the
finance and management consultancy. Currently, he is the managing director of KPTL. Previously, Mr. Mohnot
was associated with KPMG. He has also been associated with Standard Chartered Bank.
Mr. Kamal Kishore Jain
Mr Kamal Kishore Jain, aged 58 years, is a Non-Executive Director of our Company. He is an associate member
of Institute of Chartered Accountant of India and holds a bachelor’s degree in commerce from Rajasthan
University and has experience of 28 years in the field of finance, accounts, taxation, logistics and
administration.
Past directorships in listed companies
We confirm that none of our Directors is or was a director of any listed company during the last five years
preceding the date of filing of the Letter of Offer, whose shares have been or were suspended from being traded
on the BSE or the NSE, in any such company.
Further, none of our Directors is or was a director of any listed company which has been or was delisted from
the stock exchanges, except as below:
Ms. Anjali Karamnarayan Seth, Mr. Manish Dashrathmal Mohnot and Mr. Mahendra Gulabrai Punatar are
directors of Kalpataru Power Transmission Limited which was delisted from the Ahmedabad Stock Exchange
and the Jaipur Stock Exchange. The relevant details in this regard are as follows:
Currently listed on: BSE, NSE
Delisted from: Ahmedabad Stock Exchange, Jaipur Stock Exchange
Date of delisting: February 18, 2005 and December 20, 2004
Nature of delisting: Voluntary
Reasons for delisting: Lack of trading
Whether relisted: No
Term of Directors in the company: Ms. Anjali Karamnarayan Seth has been a director of Kalpataru Power
Transmission Limited since March 28, 2015. Mr. Manish Dashrathmal Mohnot has been a director of
Kalpataru Power Transmission Limited since November 1, 2006. Mr. Mahendra Gulabrai Punatar has been
a director of Kalpataru Power Transmission Limited since June 1, 2009.
71
Further, our Company got delisted from the Ahmedabad Stock Exchange and the Delhi Stock Exchange on
March 31, 2005 and December 10, 2003, respectively. The relevant details in this regard are as follows:
Currently listed on: BSE, NSE
Delisted from: Ahmedabad Stock Exchange, Delhi Stock Exchange
Date of delisting: March 31, 2005 and December 10, 2003
Nature of delisting: Voluntary
Reasons for delisting: Lack of trading
Whether relisted: No
Other confirmations
We confirm that, we have not entered into any service contracts with our Directors for providing benefits upon
termination of employment.
Except, Mr. Manish Dashrathmal Mohnot and Mr. Kamal Kishore Jain who are nominee director appointed by
Promoter, we confirm that, as on the date of the Letter of Offer, there are no arrangements or understanding with
major shareholders, customers, suppliers or others, pursuant to which we have appointed any of our Directors or
member of senior management.
72
SECTION VI – FINANCIAL INFORMATION
Financial Statements Page No
Limited reviewed unaudited standalone financial statement for the quarter ended September
30, 2015 and consolidated financial statement for the six months ended September 30, 2015
73
Financial Statements as at and for the year March 31, 2015 84
AUDITOR’S LIMITED REVIEW REPORT
To,
The Board of Directors
JMC Projects (India) Ltd.
1. We have reviewed the accompanying statement of unaudited standalone financial results of JMC Projects
(India) Ltd. (“The Company”) for the quarter ended on September 30, 2015, except for the disclosure in
Part II – Select Information referred to in para 4 below. This statement is the responsibility of the
Company’s Management and has been approved by the Board of Directors. Our responsibility is to issue a
report on these financial results based on our review.
2. We conducted our review in accordance with the Standard on Review Engagement (SRE) 2410, Review of
Interim financial Information performed by the Independent Auditors of the Entity. This Standard requires
that we plan and perform the review to obtain moderate assurance as to whether the Financial Statements
are free of material misstatement. A review is limited primarily to inquiries of company personnel and
analytical procedures applied to financial data and thus provide less assurance than an audit. We have not
performed an audit and accordingly we do not express an audit opinion.
3. Based on our review conducted as above, nothing has come to our attention that causes us to believe that
the accompanying statement of unaudited financial results prepared in accordance with applicable
accounting standards and other recognized accounting practices and policies has not disclosed the
information required to be disclosed in terms of Clause 41 of the Listing Agreement with stock exchanges
including the manner in which it is to be disclosed or that it contains any material misstatement.
4. Further, we also report that we have traced the number of shares as well as the percentage of shareholding
in respect of aggregate amount of public shareholdings, pledged / encumbered shares and non encumbered
shares of promoters & promoter group shareholding in terms of Clause 35 of the listing agreement and the
particulars relating to investor complaints disclosed in part II of the statement from the details furnished by
the Management.
For Kishan M. Mehta & Co.,
Chartered Accountants
Firm’s Registration No. 105229W
Kishan M. Mehta
(Partner)
Membership No. 13707
Place : Mumbai
Date : October 30, 2015
73
JMC Projects (India) Limited (A Kalpataru Group Enterprise) CIN : L45200GJ1986PLC008717
Regd. Office : A-104, Shapath - 4, Opp. Karnavati Club, S. G. Road, Ahmedabad 380015.
[email protected] Phone +91 79 30011500 Fax: +91 22 30051555 STATEMENT OF UNAUDITED FINANCIAL RESULTS (STANDALONE) FOR THE QUARTER AND HALF YEAR ENDED SEPTEMBER 30, 2015
( ` in Lacs)
Quarter ended
Half year ended
Previous Year
Sr
ended
Particulars
No
30/09/2015 30/06/2015 30/09/2014 30/09/2015 30/09/2014 31/03/2015
(Reviewed) (Reviewed) (Reviewed) (Reviewed) (Reviewed) (Audited)
PART - I
1 Income From operations
(a) Net sales/income from operations (Net of excise duty) 60,193 58,270 58,148 118,463 118,344 239,860
(b) Other operating income 23 8 29 31 65 128
Total Income from operations (Net) 60,216 58,278 58,177 118,494 118,409 239,988
2 Expenses
(a) Cost of materials consumed 20,705 19,883 22,939 40,588 43,988 85,926
(b) Purchases of stock-in trade - - - - - -
(c) Changes in inventories of finished goods, work-in-progress and 1,878 (1,101) (369) 777 246 (2,412)
stock-in-trade
(d) Employee benefits expense 5,756 4,984 4,512 10,740 8,824 20,029
(e) Construction expense 24,094 27,430 24,393 51,524 51,995 107,757
(f) Depreciation and amortization expense 1,276 1,205 1,211 2,481 2,428 4,892
(g) Other expenses 2,726 2,538 3,071 5,264 6,282 12,349
Total expenses 56,435 54,939 55,757 111,374 113,763 228,541
3 Profit / (Loss) from operations before other income, finance 3,781 3,339 2,420 7,120 4,646 11,447
costs and exceptional items (1-2)
4 Other Income 216 131 178 347 279 1,322
5 Profit / (Loss) from ordinary activities before finance costs and 3,997 3,470 2,598 7,467 4,925 12,769
exceptional items (3 + 4)
6 Finance costs 2,554 2,513 1,998 5,067 3,693 8,406
7 Profit / (Loss) from ordinary activities after finance costs but before 1,443 957 600 2,400 1,232 4,363
exceptional items (5 - 6)
8 Exceptional Items - - - - - -
9 Profit / (Loss) from ordinary activities before tax (7 + 8) 1,443 957 600 2,400 1,232 4,363
10 Tax Expense 485 323 167 808 370 1,377
11 Net Profit / (Loss) from ordinary activities after tax (9 - 10) 958 634 433 1,592 862 2,986
12 Extraordinary Items (net off tax expenses) - - - - - -
13 Net Profit / (Loss) for the period (11-12) 958 634 433 1,592 862 2,986
14 Paid-up Equity Share Capital (Face Value ` 10/-) 2,612 2,612 2,612 2,612 2,612 2,612
15 Reserve excluding Revaluation Reserves as per balance sheet of - - - - - 45,018
previous accounting year
16 Debenture Redemption Reserve - - - - - 356
17 Earnings Per Share (EPS)
(a) Basic EPS before and after Extraordinary items for the period 3.67 2.43 1.66 6.10 3.30 11.43
(not annualized) in `
(b) Diluted EPS before and after Extraordinary items for the period 3.67 2.43 1.66 6.10 3.30 11.43
(not annualized) in `
18 Total Debt Equity Ratio - - - 1.44 1.31 1.41
19 Debt Service Coverage Ratio (DSCR) - - - 1.39 1.31 1.40
20 Interest Service Coverage Ratio (ISCR) - - - 1.96 1.99 2.10
PART - II Information for the Quarter ended September 30, 2015
A. PARTICULARS OF SHAREHOLDING
1 Public Shareholding
Number of shares 8,569,440 8,569,440 8,569,440 8,569,440 8,569,440 8,569,440
Percentage of shareholding 32.81% 32.81% 32.81% 32.81% 32.81% 32.81%
2 Promoters and Promoter Group Shareholding a
Pledged / Encumbered - Number of Shares Nil Nil Nil Nil Nil Nil
- Percentage of shares (as a % of the total shareholding of N.A. N.A. N.A. N.A. N.A. N.A.
Promoter and Promoter group)
- Percentage of shares (as a % of the total share capital of the N.A. N.A. N.A. N.A. N.A. N.A.
Company)
b Non- Encumbered
- Number of Shares 17,548,908 17,548,908 17,548,908 17,548,908 17,548,908 17,548,908
- Percentage of shares (as a % of the total shareholding of 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Promoter and Promoter group)
- Percentage of shares (as a % of the total share capital of the 67.19% 67.19% 67.19% 67.19% 67.19% 67.19%
Company)
B. INVESTORS COMPLAINTS Quarter ended September 30, 2015
Pending at the beginning of the quarter Nil
Received during the quarter Nil
Disposed of during the quarter Nil
Remaining unresolved at the end of the quarter Nil
74
STANDALONE STATEMENT OF ASSETS AND LIABILITIES AS PER CLAUSE 41 OF THE LISTING AGREEMENT
Particulars As At
30/09/2015 31/03/2015
(Reviewed) (Audited)
A EQUITY & LIABILITIES
1 Shareholders' Fund
(a) Share Capital 2,612 2,612
(b) Reserves & Surplus 46,311 45,018
Sub-total - Shareholders' Fund
48,923 47,630
2 Minority interest *
3 Non-current liabilities
(a) Long-term borrowings 26,323 31,080
(b) Other long-term liabilities 39,838 31,926
(c) Long-term provisions 4,644 4,456
Sub-total - Non-current liabilities
70,805 67,462
4 Current liabilities
(a) Short-term borrowings 34,222 26,840
(b) Trade payables 66,139 59,342
(c) Other current liabilities 25,871 23,883
(d) Short-term provisions 458 479
Sub-total - Current liabilities
126,690 110,544
TOTAL - EQUITY AND LIABILITIES
246,418 225,636
B ASSETS
1 Non-current assets
(a) Fixed assets 31,392 31,826
(b) Goodwill on consolidation * - -
(c) Non-current investments 18,943 18,912
(d) Deferred tax assets (net) 1,332 1,534
(e) Long-term loans and advances 40,693 34,973
(f) Other non-current assets 5,523 5,420
Sub-total - Non-current assets
97,883 92,665
2 Current assets
(a) Inventories 25,778 25,153
(b) Trade receivables 39,550 41,249
(c) Cash and cash equivalents 3,070 1,474
(d) Short-term loans and advances 29,578 25,490
(e) Other current assets 50,559 39,605
Sub-total - Current assets
148,535 132,971
TOTAL - ASSETS
246,418 225,636
* Applicable in the case of consolidated statement of assets and liabilities.
Notes :
1 The above results have been taken on record by the Board of Directors on October 30, 2015 after a review by Audit Committee and Limited Review by statutory Auditors of the Company.
2 The previous year's figures have been regrouped and/or rearranged wherever considered necessary.
3 The Management identifies and monitors 'Construction' as the only Business Segment.
4 Debt Equity Ratio = (Long term Borrowings + Short term Borrowings + Current Maturities of Long term Borrowings) / (Share Capital + Reserves & Surplus - Debenture Redemption
Reserve).
5 DSCR = Earning before depreciation, finance costs and tax / [Finance costs + Principal repayment of Long term Borrowings (Net)]. ISCR = Earning before depreciation, finance costs and tax / Finance Costs.
BY ORDER OF THE BOARD OF DIRECTORS
Date : October 30, 2015 For JMC Projects (India) Ltd.
Place : Mumbai
Shailendra Kumar Tripathi
CEO & Dy. Managing Director
75
AUDITOR’S LIMITED REVIEW REPORT
The Board of Directors,
JMC Projects (India) Limited.
6th Floor, Kalpataru Synergy,
Opp. Grand Hyatt, Santacruz,
Mumbai- 400055.
Maharashtra.
Re: Report on the Unaudited Limited Reviewed Interim Financial Statements of JMC Projects (India)
Limited,(“Company”) in connection with the proposed right issue of securities of the Company,
(“Issue”).
1. We have reviewed the accompanying un-audited consolidated condensed Balance Sheet of JMC
Projects (India) Limited (the “Company”) as at September 30, 2015, and the related un-audited
consolidated condensed Profit and Loss Accounts and Condensed Cash Flow Statement for six month
period ended on that date annexed thereto (all of which are hereinafter referred to as the
“Statements”), for the purpose of its inclusion in the offer document prepared by the Company in
connection with its proposed right issue. The Statements are responsibility of the Company’s
management and has been approved by Board of Directors of the Company. Our responsibility is to
issue a report on the Statements based on our review of the Statements, which has been prepared by the
Company’s management pursuant to the requirements of Paragraph A (6) in Clause X in Part E of
Schedule VIII of SEBI (ICDR) Regulation, 2009 and other applicable provisions of the Securities and
Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2009, as
amended issued by SEBI (“SEBI (ICDR) Regulations 2009”).
2. We conducted our review in accordance with the Standard on Review Engagement (SRE) 2410-
Review of Interim Financial Information – issued by Institute of Chartered Accountants of India. This
Standard requires that we plan and perform the review to obtain moderate assurance as to whether the
financial statements are free of material misstatement. A limited review of interim financial statements
consists principally of applying analytical procedures to financial data and making enquiries with
Company personnel responsible for financial and accounting matters. It is substantially less in scope
than an audit conducted in accordance with the generally accepted auditing standards followed in
India, objective of which is the expression of an opinion regarding the financial statements as a whole.
Accordingly, we do not express such an opinion.
3. Based on our review conducted as above, nothing has come to our attention that causes us to believe
that the accompanying Statements, contain any material misstatement.
4. We did not audit the statements of subsidiaries and jointly controlled company, whose statements, are
considered in accompanying statements. These statements have been reviewed by other auditors whose
reports have been furnished to us by the management and our opinion on the statements, in so far as it
relates to the amounts included in respect of these subsidiaries and jointly controlled company, are
based solely on the reports of the other auditors.
5. This report is intended solely for the use of the Company for filing with Securities and Exchange
Board of India and Registrar of Companies in connection with the proposed right issue of Equity
Shares of the Company under SEBI (ICDR) Regulations 2009 and the same should not be used,
referred to or distributed for any other purpose, without our prior written consent. We do not accept or
assume any liability or duty of care for any other purpose or to any other person to whom this report is
shown or into whose hands it may come, save where expressly agreed by our prior consent in writing.
76
For Kishan M.Mehta & Co.,
Chartered Accountants
Firm’s Reg. No.105229W
Kishan M.Mehta
Partner
Membership No. 13707
Place : Ahmedabad
Date : 02/01/2016
77
JMC Projects (India) Ltd.
Consolidated Balance Sheet as at September 30, 2015
( Rs. in Lacs )
As at
September 30, 2015
I. EQUITY AND LIABILITIES
(1) Shareholders' Funds
(a) Share Capital
2611.83
(b) Reserves and Surplus
33879.35
36491.18
(2) Non Current Liabilities
(a) Long-Term Borrowings
162795.44
(b) Other Long Term Liabilities
41646.70
(c) Long-Term Provisions
6037.01
210479.15
(3) Current Liabilities
(a) Short-Term Borrowings
34222.04
(b) Trade Payables
67836.95
(c) Other Current Liabilities
26457.84
(d) Short-Term Provisions
465.56
128982.39
TOTAL
375952.72
78
II. ASSETS
(1) Non-Current Assets
(a) Fixed Assets
(i) Tangible Assets
31187.35
(ii) Intangible Assets
168438.25
(iii) Capital Work-in-Progress
274.79
(iv) Intangible Assets under Development
10682.19
210582.58
(b) Non Current Investments
1085.47
(c) Deferred Tax Assets (Net)
1331.80
(d) Long-Term Loans and Advances
8515.58
(e) Other Non-Current Assets
5507.01
227022.44
(2) Current Assets
(a) Inventories
25791.33
(b) Trade Receivables
38931.08
(c) Cash and Bank Balances
3541.56
(d) Short-Term Loans and Advances
30107.38
(e) Other Current Assets
50558.93
148930.28
TOTAL
375952.72
79
JMC Projects (India) Ltd.
Consolidated Statement of Profit and Loss for half year ended September 30, 2015
( Rs. in Lacs )
Particulars Half year ended
September 30, 2015
INCOME
Sale of Services 112438.66
Accrued Value of Work Done (uncertified bills) 13004.95
Other Operating Revenue 30.65
Other Income 349.67
TOTAL REVENUE 125823.93
EXPENSES
Construction Materials Consumed 40587.95
(Increase) / Decrease in Inventories of Work-in-Progress 777.07
Employee Benefit Expense 10875.86
Finance Cost 12213.49
Depreciation and Amortization Expense 4158.21
Other Expenses 61337.00
TOTAL EXPENSES 129949.58
Profit before exceptional and extraordinary items and tax (4125.65)
Exceptional Items -
Profit before extraordinary items and tax (4125.65)
Extraordinary Items -
Profit before tax (4125.65)
80
Tax Expense :
Current Tax 605.90
Deferred Tax 202.07
Profit / (Loss) for the year (4933.62)
Earnings per equity share : [Nominal value Rs.10/- per share]
Basic (in Rs.) (18.89)
Computed on the basis of profit for the year
Diluted (in Rs.) (18.89)
Computed on the basis of profit for the year
81
Consolidated Cash Flow Statement for the half year ended September 30, 2015
( Rs. in Lacs )
PARTICULARS Half year ended
September 30, 2015
A. CASH FLOW FROM OPERATING ACTIVITIES
PROFIT BEFORE TAX AND EXTRAORDINARY ITEMS (4125.65)
ADD / (DEDUCT) ADJUSTMENTS FOR :
Depreciation 4158.21
Interest Paid 12213.49
Unrealised (Profit) / Loss from Exchange Rate Variation 82.61
Amortization of ancillary cost & Site Infrastructures 1391.11
Loss on Assets Lost 5.30
Deferred Employee Compensation written back (32.04)
Interest Income (116.28)
(Profit) / Loss on Sale of Assets (Net) (102.21)
Share of Profit from Investment in Joint Venture (30.65)
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 13443.89
ADJUSTMENTS FOR :
Trade & Other Receivables (14503.44)
Inventories (624.85)
Trade & Other Payables 20404.96
CASH GENERATED FROM OPERATIONS 18720.56
Direct Taxes Paid (1840.91)
NET CASH FLOW FROM OPERATING ACTIVITIES 16879.65
82
B. CASH FLOW FROM INVESTING ACTIVITIES
Investment in Fixed Assets (3779.03)
Investment in Intangible Assets under Development (7859.53)
Sale of Fixed Assets 850.43
Share of Profit from Investment in Joint Venture 30.65
Deposit with Banks (144.95)
Non-Current Investments (30.65)
Interest Received 116.28
NET CASH FLOW FROM INVESTING ACTIVITIES (10816.80)
C. CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from Term Borrowings 4733.08
Repayment of Term Borrowings (4532.19)
Working Capital Finance 7382.39
Interest Paid (12476.43)
NET CASH FLOW FROM FINANCING ACTIVITIES (4893.15)
NET INCREASE / (DECREASE) IN CASH PAID & CASH EQUIVALENTS 1169.70
OPENING BALANCE OF CASH & CASH EQUIVALENTS 2089.13
CLOSING BALANCE OF CASH & CASH EQUIVALENTS 3258.83
83
JMC Projects (India) Ltd.40
INDEPENDENT AUDITOR’S REPORTTo
The Members of
JMC Projects (India) Limited.
Report on the Financial Statements
We have audited the accompanying standalone financial statements of JMC Projects (India) Limited (“the Company”), which comprise the
Balance Sheet as at March 31, 2015, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary
of significant accounting policies and other explanatory information.
Management’s Responsibility for the Financial Statements
The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (‘the act’) with respect to
the preparation of these standalone financial statements that give a true and fair view of the financial position , financial performance and cash
flow of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified
under Section 133 of the Act, read with rule 7 of Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting
frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable
and prudent and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring
the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a
true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these standalone financial statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the
provisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that
we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of
the financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances. An audit
also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Company’s
Directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial
statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements
give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles
generally accepted in India of the state of affairs of the Company as at March 31, 2015 and its Profit and Cash Flows for the year ended on
that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor’s Report) Order, 2015 (“the Order”) issued by the Central Government of India in terms of sub-
section (11) of section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for
the purpose of our audit;
84
JMC Projects (India) Limited
41Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
b) In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination
of those books;
c) The Balance Sheet, the Statement of Profit and Loss and Cash Flow Statement dealt with by this Report are in agreement with the
books of account;
d) In our opinion, the aforesaid standalone financial statements, comply with the applicable Accounting Standards referred to under
section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;
e) On the basis of written representations received from the directors as on March 31, 2015, and taken on record by the Board of
Directors, none of the directors is disqualified as on March 31, 2015, from being appointed as a director in terms of section 164(2) of
the Act;
f) With respect to other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014 , in our opinion and to the best of our information and according to the explanations given to us:
(i) The Company has disclosed the impact if any, of pending litigations in its financial statements- Refer Note No. 27 and 28 to the
financial statements;
(ii) The Company has made provision, as required under the applicable law and accounting standards for material foreseeable losses
on long term contracts including derivative contracts;
(iii) There has been no delay in transferring amount required to be transferred, to the Investor Education and Protection Fund by the
Company.
For KISHAN M.MEHTA & CO.,
Chartered Accountants
Firm’s Registration No.105229W
Place : Mumbai (K.M.MEHTA)
Date : May 29, 2015 Partner
Membership No. : 13707
85
JMC Projects (India) Ltd.42
ANNEXURE TO THE AUDITORS’ REPORT(Referred to in paragraph 1 under Report on Other Legal and Regulatory Requirements of our report of even date)
(i) a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets;
b) As explained to us, the fixed assets have been physically verified by the management in reasonable interval and no material discrepancies have been noticed on such verification.
(ii) a) The inventory has been physically verified by the management during the year at reasonable intervals.
b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.
c) The Company is maintaining proper records of inventory. In our opinion, discrepancies noticed on physical verification of stocks were not material.
(iii) The Company has not granted any loan, secured or unsecured, to Companies, firms or other parties covered in the register maintained under section 189 of the Act.
(iv) In our opinion and according to the information and explanation given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business of with regard to purchases of inventory and fixed assets and sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.
(v) The Company has complied with the directives issued by the Reserve Bank of India and the provisions of section 73 to 76 or any other relevant provisions of the Companies Act and the rules framed thereunder in relation to the deposits.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government of India, regarding the maintenance of cost records under sub section (1) of section 148 of the Companies Act, 2013 and are of the opinion that prima facie, the prescribed accounts and records have been maintained. We have, however not made a detailed examination of the records with a view to determine whether they are accurate or complete.
(vii) a) According to the information and explanations given to us and the records examined by us, the Company is regular in depositing with appropriate authorities the undisputed statutory dues including Provident Fund, Employees’ State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and any other material statutory dues applicable to it and there are no such undisputed amount payable which are in arrears as at March 31, 2015 for a period of more then six months from the date they became payable.
b) According to the information and explanations given to us, details of dues of Income Tax, Sales Tax, Wealth Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax and Cess which have not been deposited on account of dispute are given below.
Name of the Statute Particulars Period of which the amount relates
Forum where the dispute is pending
Amount (` In Lacs)
Finance Act, 1994 Service Tax 2007-08 to 2009-10 Customs, Excise and Service Tax
Appellate Tribunal, Ahmedabad
2898.09
Finance Act, 1994 Service Tax 2008-09 to 2012-13 Customs, Excise and Service Tax
Appellate Tribunal, Ahmedabad
2505.73
Finance Act, 1994 Service Tax 1997-98 Customs, Excise and Service Tax
Appellate Tribunal, Ahmedabad
2.18
The West Bengal VAT Act, 2003 VAT 2008-09 West Bengal Commercial Taxes
Appellate and Revisional Board
57.10
The West Bengal VAT Act, 2003 VAT 2009-10 West Bengal Commercial Taxes
Appellate and Revisional Board
105.80
The West Bengal VAT Act, 2003 VAT 2011-12 Dept. Commissioner Kolkata 0.37
Madhya Pradesh VAT Act, 2002 VAT 2007-08 & 2008-09 High Court 295.17
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43Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
Name of the Statute Particulars Period of which the amount relates
Forum where the dispute is pending
Amount (` In Lacs)
Madhya Pradesh VAT Act, 2002 VAT 2009-10 Addl. Commissioner Appeals 8.47
Madhya Pradesh VAT Act, 2002 Entry Tax 2008-09 High Court 52.05
Madhya Pradesh VAT Act, 2002 Entry Tax 2009-10 Addl. Commissioner Appeals 6.59
Gujarat VAT Act, 2003 VAT & CST 2006-07 Gujarat VAT Tribunal 261.72
Gujarat VAT Act, 2003 VAT & CST 2009-10 Asst. Commissioner of
Commercial Appeals
125.40
Maharashtra VAT Act, 2002 VAT 2006-07 Dept. Commissioner of Sales Tax 145.10
Maharashtra VAT Act, 2002 VAT 2007-08 Joint Commissioner of Sales Tax 15.10
Maharashtra VAT Act, 2002 VAT 2008-09 Dept. Commissioner of Sales Tax 789.18
Uttaranchal VAT matter VAT 2010-11 Dept. Commissioner of
Commercial Tax
549.00
New Delhi VAT matter VAT 2012-13 & 2013-14 Objection Hearing Authority
Sales Tax department Delhi
521.80
Income Tax Act, 1961 Income Tax 2006-07 to 2011-12 Commissioner (Appeals) 1539.11
Tamil Nadu Minor Mineral Concession
Rules
Royalty 2006-07 Principal Secretary / Joint
Secretary, Industries.
39.87
c) The Company has transferred the required amount to Investor Education and Protection Fund in accordance with the relevant provision of the Companies Act, 1956 and rules made there under within time.
(viii) There are no accumulated losses of the Company as on March 31, 2015. The Company has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.
(ix) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks, financial institutions and debentures holders.
(x) According to the information and explanations given to us, the Company has given guarantee for loans taken by a subsidiary company from banks and financial institutions of Rs. 22.50 Crores and the terms and conditions whereof are not prejudicial to the interest of the Company.
(xi) According to the information and explanations given to us and in our opinion the term loan raised have been applied for the purpose for which they were obtained.
(xii) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statement and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.
For KISHAN M.MEHTA & CO., Chartered Accountants
Firm’s Registration No.105229W
Place : Mumbai (K.M.MEHTA) Date : May 29, 2015 Partner
Membership No. : 13707
87
JMC Projects (India) Ltd.44
BALANCE SHEET as at March 31, 2015 (` in Lacs)
Particulars Note No. As at March 31, 2015 March 31, 2014
EQUITY AND LIABILITIESShareholder’s funds(a) Share Capital 1 2611.83 2611.83 (b) Reserves and Surplus 2 45017.78 42928.58
47629.61 45540.41 Non-current liabilities(a) Long-Term Borrowings 3 31080.18 22363.74 (b) Other Long Term Liabilities 5 31925.76 23600.37 (c) Long-Term Provisions 6 4455.93 3398.74
67461.87 49362.85 Current liabilities(a) Short-Term Borrowings 7 26839.65 13447.32 (b) Trade Payables 8 59342.96 56964.52 (c) Other Current Liabilities 9 23883.21 19199.34 (d) Short-Term Provisions 10 478.91 1414.67
110544.73 91025.85 TOTAL 225636.21 185929.11 ASSETSNon-current assets(a) Fixed assets (i) Tangible Assets 11A 31768.95 27402.34 (ii) Intangible Assets 11B 49.11 81.78 (iii) Capital Work-in-Progress 11C 8.07 928.90
31826.13 28413.02 (b) Non Current Investments 12 18912.16 18784.23 (c) Deferred Tax Assets (Net) 4 1533.88 1658.07 (d) Long-Term Loans and Advances 13 34972.93 23550.74 (e) Other Non-Current Assets 14 5419.86 4082.52
92664.96 76488.58 Current assets(a) Inventories 15 25153.23 24236.13 (b) Trade Receivables 16 41248.56 35197.00 (c) Cash and Bank Balances 17 1473.99 2402.76 (d) Short-Term Loans and Advances 18 25490.20 18101.55 (e) Other Current Assets 19 39605.27 29503.09
132971.25 109440.53 TOTAL 225636.21 185929.11 Significant Accounting PoliciesSee accompanying Notes to the Financial Statements 1 to 47
As per our report attached For and on behalf of the Board of DirectorsFor Kishan M. Mehta & Co.Chartered Accountants Shailendra Kumar Tripathi Manoj TulsianFirm Registration No. 105229W CEO & Dy. Managing Director CFO & Director (Finance)
Kishan M. Mehta Manoj Kumar Singh Suresh SavaliyaPartner Executive Director Company SecretaryMembership No. 13707
Mumbai, May 29, 2015 Mumbai, May 28, 2015
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45Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
STATEMENT OF PROFIT AND LOSS for the year ended March 31, 2015
(` in Lacs)
Particulars Note No. For the year ended
March 31, 2015 March 31, 2014
INCOME
Revenue from Operations 20 239988.09 265426.25
Other Income 21 1321.67 856.14
TOTAL REVENUE 241309.76 266282.39
EXPENSES
Construction Materials Consumed 22 85926.48 88239.83
(Increase) / Decrease in Inventories of Work-in-Progress 23 (2411.52) (1752.73)
Employee Benefit Expense 24 20028.81 16888.15
Finance Cost 25 8405.66 5513.95
Depreciation and Amortization Expense 11 4891.98 5889.89
Other Expenses 26 120105.16 148482.57
TOTAL EXPENSES 236946.57 263261.66
Profit before exceptional and extraordinary items and tax 4363.19 3020.73
Exceptional Items - -
Profit before extraordinary items and tax 4363.19 3020.73
Extraordinary Items - -
Profit before tax 4363.19 3020.73
Tax expense
Current Tax 914.54 633.15
Deferred Tax 462.77 90.50
Profit / (Loss) for the year 2985.88 2297.08
Earnings per equity share : [Nominal value `10/- per share]
Basic (in `) 35 11.43 8.79
Computed on the basis of profit for the year
Diluted (in `) 35 11.43 8.79
Computed on the basis of profit for the year
Significant Accounting PoliciesSee accompanying Notes to the Financial Statements 1 to 47
As per our report attached For and on behalf of the Board of DirectorsFor Kishan M. Mehta & Co.Chartered Accountants Shailendra Kumar Tripathi Manoj TulsianFirm Registration No. 105229W CEO & Dy. Managing Director CFO & Director (Finance)
Kishan M. Mehta Manoj Kumar Singh Suresh SavaliyaPartner Executive Director Company SecretaryMembership No. 13707
Mumbai, May 29, 2015 Mumbai, May 28, 2015
89
JMC Projects (India) Ltd.46
CASH FLOw STATEMENT for the year ended March 31, 2015
(` in Lacs) Particulars For the year ended
March 31, 2015 March 31, 2014A. CASH FLOW FROM OPERATING ACTIVITIES PROFIT BEFORE TAX AND EXTRAORDINARY ITEMS 4363.19 3020.73 ADD / (DEDUCT) ADJUSTMENTS FOR : Depreciation 4891.98 5889.89 Interest Paid 8405.66 5513.95 Unrealised (Profit) / Loss from Exchange Rate Variation 16.15 (44.10) Amortization of ancillary cost & Site Infrastructures 3014.55 3167.37 Loss on Assets Lost 22.05 33.38 Deferred Employee Compensation written back (44.78) (58.35) Interest Income (578.84) (101.94) Dividend Income (0.06) (0.14) (Profit) / Loss on Sale of Assets (Net) (140.93) (218.85) Share of Profit from Investment in Joint Venture (128.12) (230.79) Share of Loss from Investment in Joint Venture 0.48 7.04 OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 19821.33 16978.19 ADJUSTMENTS FOR : Trade & Other Receivables (38429.85) (22398.23) Inventories (917.10) (3091.99) Trade & Other Payables 15223.75 24124.83 CASH GENERATED FROM OPERATIONS (4301.87) 15612.80 Direct Taxes Paid (2864.55) (2698.00) NET CASH FLOW FROM OPERATING ACTIVITIES (7166.42) 12914.80B. CASH FLOW FROM INVESTING ACTIVITIES Investment in Fixed Assets (7883.08) (9723.47) Sale of Fixed Assets 327.99 828.51 Non-Current Investments (127.93) (1716.22) Share of Profit from Investment in Joint Venture 128.12 230.79 Share of Loss from Investment in Joint Venture (0.48) (7.04) Deposit with Banks 185.96 (184.51) Interest Received 578.84 101.94 Dividend Received 0.06 0.14 NET CASH FLOW FROM INVESTING ACTIVITIES (6790.52) (10469.86)C. CASH FLOW FROM FINANCING ACTIVITIES Proceeds From Term Borrowings 16142.04 9628.84 Repayment of Term Borrowings (7425.60) (5048.84) Working Capital Finance 13392.33 (1603.23) Interest Paid (8589.07) (5345.05) Dividend Paid (261.18) (261.18) Corporate Dividend Tax Paid (44.39) (44.39) NET CASH FLOW FROM FINANCING ACTIVITIES 13214.13 (2673.85) NET INCREASE / (DECREASE) IN CASH PAID & CASH EQUIVALENTS (742.81) (228.91) OPENING BALANCE OF CASH & CASH EQUIVALENTS 2080.01 2308.92 CLOSING BALANCE OF CASH & CASH EQUIVALENTS 1337.20 2080.01Previous Year figures have been regrouped and / or rearranged wherever considered necessary.
As per our report attached For and on behalf of the Board of DirectorsFor Kishan M. Mehta & Co.Chartered Accountants Shailendra Kumar Tripathi Manoj TulsianFirm Registration No. 105229W CEO & Dy. Managing Director CFO & Director (Finance)
Kishan M. Mehta Manoj Kumar Singh Suresh SavaliyaPartner Executive Director Company SecretaryMembership No. 13707
Mumbai, May 29, 2015 Mumbai, May 28, 2015
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47Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
i Basis of Accounting
The financial statements have been prepared under the historical cost convention, on accrual basis, in accordance with the generally accepted accounting principles (GAAP) in India and applicable Accounting Standards referred to under Section 133 of the Companies Act, 2013 read with rule 7 of the Companies (Accounts) Rules, 2014.
ii Use of Estimates
The presentation of financial statements requires certain estimates and assumptions. These estimates and assumptions affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual result and estimates are recognized in the period in which the results are known / materialized.
iii Revenue Recognition
a. Construction Revenue
Running Account Bills for work completed are recognized on percentage of completion method based on completion of physical proportion of the contract work. Income on account of claims and extra item work are recognized to the extent Company expects reasonable certainty about receipts or acceptance from the client. When it is probable that total contract cost will exceed the total contract revenue, the expected loss is recognized immediately.
b. Others
Dividends are recorded when the right to receive the payment is established. Interest income is recognized in time proportionate basis.
iv Fixed Assets
Fixed Assets are stated at cost less accumulated depreciation less impairment losses, if any. Cost is inclusive of all identifiable expenditure incurred to bring the assets to their working condition for intended use. When an asset is disposed off, demolished or destroyed, the cost and related depreciation are removed from the books of accounts and resultant profit or loss, is reflected in the Statement of Profit & Loss. Direct cost as well as related incidental and identifiable expenses incurred on acquisition of fixed assets that are not yet ready for their intended use or put to use as at the Balance Sheet date are stated as Capital Work in Progress.
v Depreciation / Amortisation
i. Tangible Assets :
Depreciation on tangible assets is provided for on the basis of straight-line method on pro rata as per the useful life prescribed in Schedule II to the Companies Act, 2013 or as per the useful life assessed by the management based on technical evaluation which is not longer than useful life specified in schedule-II as follows:
(a) Useful life of Plant & Equipment assessed 3 years in place of 12 years as per schedule II
(b) Useful life of several Plant & Equipments assessed 10 years in place of 12 years as per schedule II
ii. Intangible Assets :
Depreciation on intangible assets is provided on straight line method over the estimated useful life of 3 years.
vi Impairment of Fixed Assets
The carrying cost of assets is reviewed at each Balance Sheet date to determine whether there is any indication of impairment of assets. If any indication exists, the recoverable value of such assets is estimated. An impairment loss is recognized when the carrying cost of assets exceeds its recoverable value. An impairment loss is reversed, if there has been a change in the estimates used to determine the recoverable amount and recognized in compliance with AS - 28.
vii Investments
Investments are stated at cost. Provision for diminution in the value of long term investments is made only if such a decline is other than temporary in the opinion of the Management.
viii Retirement Benefits
a. Gratuity liability is covered by payment there of to Gratuity fund, the defined benefit plan under Group Gratuity Cash Accumulation Scheme of Life Insurance Corporation of India and SBI Life Insurance under irrevocable trust. The Company’s liability towards gratuity are determined on the basis of actuarial valuation done by independent actuary.
b. Contribution to Provident Fund and Superannuation Fund, the defined contribution plans as per the schemes are charged to the Statement of Profit & Loss.
SIGNIFICANT ACCOUNTING POLICIES
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JMC Projects (India) Ltd.48
SIGNIFICANT ACCOUNTING POLICIES c. Provision for Leave encashment liability is made based on actuarial valuation as at the Balance Sheet date.
d. All other short-term benefits for employees are recognized as an expense at the undiscounted amount in the Statement of Profit & Loss of the year in which the related service is rendered.
ix Inventories
a. Construction materials, stores, spares and tools are valued at lower of cost or net realizable value. Cost include cost of purchase and other expenses incurred in bringing inventory to their respective present location and condition. Cost is determined using FIFO method of inventory valuation.
b. Work in progress is valued at lower of cost or net realizable value.
x Provision for Taxes
a. Current Tax:
Tax on income for the current period is determined on the basis of estimated taxable income and tax credit computed in accordance with provisions of the Income Tax Act, 1961.
b. Deferred Tax:
Deferred tax is recognized, on timing differences, being the difference between the taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. It is calculated using the applicable tax rates and tax laws that have been enacted or substantially enacted as on the balance sheet date. Deferred tax assets which arises mainly on account of unabsorbed depreciation and payments u/s. 40(a)(ia) & 43B of the Income Tax Act, 1961 are recognized and carried forward only to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realized.
xi Foreign Currency
a. Transactions denominated in Foreign Currency are recorded at the exchange rate prevailing on the date of transaction.
b. In respect of transactions covered by forward exchange contracts, the difference between the forward rate and the exchange rate at the date of the transaction is recognized as income or expense over the life of the contract. Any income or expense on account of exchange rate difference either on settlement or on translation is recognized in the Statement of Profit & Loss.
c. Assets & Liabilities remaining unsettled at the end of the year, other than covered by forward exchange contracts are translated at exchange rate prevailing at the end of the year and the difference is adjusted in the Statement of Profit & Loss.
d. Translation of overseas projects of non-integral foreign operations:
i Assets and liabilities at the rates prevailing at the end of the year.
ii Income and expenses at the average exchange rate prevailing for the month of transactions.
iii Resulting exchange differences are accumulated in foreign currency translation reserve account.
xii Borrowing Costs
Borrowing Costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that takes necessarily substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.
xiii Provisions, Contingent Liabilities and Contingent Assets
Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and that probably requires an outflow of resources.
A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no disclosure is made.
xiv Accounting for Project Mobilisation expenses
Expenditure incurred on creation of site infrastructures is written off in proportion to work done at respective sites so as to absorb such expenditure during the tenure of the contract.
xv Balance of Receivables
Trade receivables of the clients in these accounts are disclosed net of advances outstanding at the year end from the respective clients.
xvi Other Accounting Policies
Accounting Policies not specifically referred to, are consistent with the generally accepted accounting practices.
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49Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014
NOTE - 1
SHARE CAPITAL
Authorised:
3,50,00,000 (3,50,00,000) Equity Shares of ` 10/- each 3500.00 3500.00
15,00,000 (15,00,000) Preference Shares of ` 100/- each 1500.00 1500.00
5000.00 5000.00
Issued, Subscribed and Paid up:
2,61,18,348 (2,61,18,348) Equity Shares of ` 10/- each fully paid up 2611.83 2611.83
TOTAL 2611.83 2611.83
a. Reconciliation of the Shares outstanding at the beginning and at the end of the year :
Equity Shares As at March 31, 2015 As at March 31, 2014
Nos. ( ` in Lacs ) Nos. ( ` in Lacs )At the beginning of the year 26118348 2611.83 26118348 2611.83
Issued during the year - - - -
Bought back during the year - - - -
Outstanding at the end of the year 26118348 2611.83 26118348 2611.83
b. Terms / Rights attached to Equity Shares
The Company has only one class of Equity Shares having par value of ` 10/- per share. Each holder of Equity Shares is entitled to one vote per share. The dividend is declared and paid on being proposed by the Board of Directors after the approval of the Shareholders in the ensuing Annual General Meeting.
In the event of liquidation of the Company, the holders of Equity Shares will be entitled to receive remaining assets of the Company, after distribution of all liabilities. The distribution will be in proportion to the number of Equity Shares held by the shareholders.
c. Shares held by Holding Company and its Subsidiaries / Associates.
Out of Equity Shares issued by the Company, the Shares held by Holding and its Subsidiaries / Associates are as below :
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014Kalpataru Power Transmission Ltd.
1,75,48,908 (1,75,48,908) Equity Shares of ` 10/- each fully paid 1754.89 1754.89
d. Details of shareholders holding more than 5% shares in the company
As at March 31, 2015 As at March 31, 2014
Nos. % holding Nos. % holding
Equity Shares of ` 10/- each fully paid
Kalpataru Power Transmission Ltd., the Holding Company
1,75,48,908 67.19% 1,75,48,908 67.19%
e. Shares reserved for issue under options
The Company has reserved issuance of 10,00,000 (10,00,000) Equity Shares of ` 10/- each for offering to the eligible employees of the Company under Employee Stock Option Plan (ESOP). On 21st July, 2007, the Company granted 6,00,000 Options to the eligible employees at a price of ` 217/- each, and these Options have been vested over the period of 4 years from the date of grant based on specified criteria. As at March 31, 2015 the total number of options vested but not excercised by employees stood at 58,235 (P.Y. 1,39,655).
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
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JMC Projects (India) Ltd.50
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014
Note - 2
RESERVES & SURPLUS
Securities Premium:
As per last Balance Sheet 21209.18 21209.18
21209.18 21209.18
Debenture Redemption Reserve
As per last Balance Sheet 750.00 893.75
Add: Transfer from Surplus of Profit 106.25 231.25
Less: Transfer to General Reserve 500.00 375.00
356.25 750.00
Employee Share Options Outstanding
Employee share options granted - at the beginning of the year 76.82 135.17
Less: Deferred Employee Share Compensation 44.78 58.35
32.04 76.82
Foreign Currency Translation Reserve
As per last Balance Sheet (104.22) (0.26)
Add: During the year 119.98 (103.96)
15.76 (104.22)
General Reserve:
As per last Balance Sheet 3747.91 3147.91
Add: Transfer from Surplus of Profit 225.00 225.00
Add: Transfer from Debenture Redemption Reserve 500.00 375.00
Less: Transfer to Accumulated Depreciation 657.53 -
3815.38 3747.91
Surplus of Profit
Balance as per Last Balance Sheet 17248.89 15713.63
Add: Profit for the year as per Statement of Profit & Loss 2985.88 2297.08
Less: Appropriations :
Proposed Dividend 261.18 261.18
Corporate Tax on Proposed Dividend 53.17 44.39
Transfer to Debenture Redemption Reserve 106.25 231.25
Transfer to General Reserve 225.00 225.00
Net Surplus of Profit 19589.17 17248.89
TOTAL 45017.78 42928.58
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
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51Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
(` in Lacs)
As at March 31, 2015 As at March 31, 2014
Non-Current Current Non-Current Current
Note - 3
LONG TERM BORROWINGS
A. Secured Loans
(a) Debentures
150 ( 350 ) 9.5% Secured Redeemeble Non - Convertible Debentures of ` 10,00,000/- each.
- 1500.00 1500.00 2000.00
(b) Term Loans:
(1) Foreign Currency Loans
From Banks 1151.54 1535.38 2686.92 1535.38
(2) Rupee Loans
(I) From Banks 7836.31 2350.00 6342.83 3083.33
(II) From NBFCs 9807.94 1715.74 610.15 230.16
(III) Loan against Vehicles / Equipments 89.56 39.46 90.41 45.69
TOTAL (b) 18885.35 5640.58 9730.31 4894.56
B. Unsecured Loans(1) Fixed Deposits from Public 19.83 996.48 1133.43 235.27
(2) Rupee Term Loans from Banks 12175.00 825.00 10000.00 -
Amount disclosed under the head "Other Current Liabilities" (Note - 9) (8962.06) (7129.83)
TOTAL [(A) + (B)] 31080.18 - 22363.74 -
Notes:
Nature of Security Terms of Repayment
A. (a) 9.5% Secured Redeemable Non-Convertible Debentures (NCDs) :-
First charge on movable fixed assets of the Company to the extent of 1.25 times of the amount of NCDs in paripassu with a Bank in (b) (2) (I) (ii), and first charge by mortgage of a land at Maharajpura, Kadi, Gujarat.
NCDs are repayable in tranches at the end of 5th Year ` 1,500 lacs from date of allotment i.e. July 15, 2010.
(b) (1) Foreign Currency Term Loans from Banks (FCL) :-
External Commercial Borrowing of US $ 53.85 Lacs (P.Y. US $ 84.62 Lacs) is secured by first charge on specific movable fixed assets financed by them.
FCL is repayable in balance 7 equal quarterly instalments of US $ 769,230.77 each and carry interest @ 6 months LIBOR plus spread.
(b) (2) (I) Rupee Term Loans from Banks :-
(b) (2) (I) (i)
Term Loan from a consortium Bank amounting to ` 1,717.56 lacs (P.Y. ` 2,499.08 lacs) is secured by first and exclusive charge over the fixed assets financed by them.
Term Loan is repayable in balance 11 equal quarterly instalments of ` 156.25 lacs each with varying interest rate linked to base rate of Bank from time to time.
(b) (2) (I) (i-a)
Term Loan from a Bank amounting to ` Nil (P.Y. ` 833.33 lacs) is secured by first charge on movable fixed assets exluding assets charged exclusively to term lender in b (1), b (2) (I) (i) and b (2) (II) in paripassu with debenture holders to the extent of 1.25 times of the amount of NCDs and a Bank in (b) (2) (I) (iii).
No outstanding balance as on the date of Financial Statement.
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
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JMC Projects (India) Ltd.52
(b) (2) (I) (ii)
Term Loan from a Bank amounting to ` 4,468.75 lacs (P.Y. ` 6,093.75 lacs) is secured by first charge on movable fixed assets excluding assets charged exclusively to term lender in b (1), b (2) (I) (i) and b (2) (II) in paripassu with debenture-holders to the extent of 1.25 times of the amount of NCDs and a bank in (b) (2) (I) (ii).
Term Loan is repayable in balance 11 equal quarterly instalments with varying interest rate linked to base rate of Bank from time to time.
(b) (2) (I) (iii)
Term Loan from a Bank amounting to ` 4,000.00 lacs (P.Y. ` Nil) is secured exclusively by first charge on movable fixed assets funded out of the said facility.
Term Loan is repayable in unequal quarterly instalments every year starting from the end of 5th quarter from the date of disbursement, with varying interest rate linked to base rate of Bank from time to time.
(b) (2) (II) Rupee Term Loan from NBFC :-
Term Loan from NBFC amounting to ` 1,523.68 lacs (P.Y. ` 840.31 lacs) is secured by first and exclusive charge by way of hypothecation for equipments financed by them.
Term Loan is repayable in 48 months through quarterly instalments commencing from the end of 180 days from the date of first disbursement, i.e. October 18, 2013 with interest payable monthly at varying interest rate linked to base rate of NBFC from time to time.
Term Loan from NBFC amounting to ` 10,000.00 lacs (P.Y. ` Nil) is secured by subservient charge over the entire movable tangible assets of the company and further guaranteed by the Holding Company.
Term Loan is repayable in 8 equal quarterly instalments commencing from March 15, 2016 with interest payable monthly at varying interest rate linked to base rate of Bank from time to time and further there is a Put Option at the end of 12 months from the date of first disbursement and every year thereafter.
(b) (2) (III) Loan against Vehicles / Equipments :
Loans of ` 129.02 lacs (P.Y. ` 136.10 lacs) are secured by way of charge on specific equipments and vehicles financed by them on different loans.
60 monthly instalments beginning from the month subsequent to disbursement.
B. Unsecured Loans :
(1) Fixed Deposits from public of ` 1,016.31 lacs (P.Y. ` 1,368.70 lacs)
Fixed deposits maturing at 12, 24 and 36 months from the date of deposit with varying interest rate with reference to tenure of deposits.
(2) Term Loan from a Bank amounting to ` 13,000.00 lacs (P.Y. ` 10,000.00 lacs).
Term Loan is repayable in unequal quarterly instalments every year, i.e. 10% for 2nd & 3rd year and 20% from 4th to 7th year, starting from the end of 5th quarter from March 11, 2014, with varying interest rate linked to base rate of Bank from time to time.
Borrower has a right to prepay the facility anytime and lender has a right to recall the facility, after 5 years from the first drawdown date after 15 days notice.
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
96
JMC Projects (India) Limited
53Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014
Note - 4
DEFERRED TAX LIABILITY / (ASSET)
Deferred Tax Liability
Others 195.10 7.70
Deferred Tax Asset
Depreciation (661.50) (237.49)
U/s. 43B and 40(a)(ia) of Income Tax Act (1067.48) (1428.28)
TOTAL (1533.88) (1658.07)
Note - 5
OTHER LONG TERM LIABILITIES
Trade Payables 12052.78 8721.65
Others
Advance from Clients 19714.23 14720.24
Payable to Joint Venture Entities 158.75 158.48
31925.76 23600.37
Note - 6
LONG TERM PROVISIONS
Provision for employee benefits
Leave Encashment 293.37 274.05
Gratuity 524.09 368.29
Other Provisions
Defect Libility Period Expenses 3638.47 2756.40
TOTAL 4455.93 3398.74
Note - 7
SHORT TERM BORROWINGS
Secured
Working Capital Loans Repayable on Demand from Banks @ # 21765.71 13372.91
Unsecured
Commercial Paper 5000.00 -
Fixed Deposits from Public 73.94 74.41
TOTAL 26839.65 13447.32
@ Working Capital Loans include an overdraft of ` Nil (P.Y. ` 122.69 Lacs) from a non consortium bank which is secured against fixed deposit placed with the same bank.
# Working Capital Loans are secured in favour of consortium bankers, by way of :
(a) First charge against hypothecation of stocks, work in progress, stores and spares, bills receivables, book debts and other current assets.
(b) Second charge on movable Fixed assets except in (c) hereunder.
(c) First charge on the office premises of the Company.
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
97
JMC Projects (India) Ltd.54
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014
Note - 8
TRADE PAYABLES
Acceptances 10223.14 10378.99
Others 49119.82 46585.53
TOTAL 59342.96 56964.52
Note - 9
OTHER CURRENT LIABILITIES
Current Maturities of Long Term Debt
9.5% Secured Redeemeble Non - Convertible Debentures of ` 10,00,000/- each. [Refer Note 3 - A(a)]
1500.00 2000.00
Term Loans from Banks & NBFCs - [Refer Note 3 - A(b)(1), A(b)(2)(I), A(b)(2)(II) & B(2)] 6426.12 4848.87
Loan against Vehicles / Equipments [Refer Note 3 - A(b)(2)(III)] 39.46 45.69
Fixed Deposits from Public [Refer Note 3 - B(1)] 996.48 235.27
Interest Accrued but not due on Borrowings 286.65 470.06
Unclaimed Dividend 9.09 9.04
Unclaimed Matured Fixed Deposits and Interest 24.70 14.42
Others
Payables for Capital Goods 1845.88 1282.04
Advance from Clients 10549.65 7294.34
Other Statutory Liabilities * 2161.75 2946.48
Unclaimed Share Application Money 0.13 0.13
Security Deposits 43.30 53.00
TOTAL 23883.21 19199.34
* Includes VAT Payable ` 188.29 lacs (P.Y. ` 188.45 lacs) [Net of Advance ]
Note - 10
SHORT TERM PROVISIONS
Provision for Employee Benefits
Leave Encashments 37.47 34.48
Other Provisions
Defect Liability Period Expenses 127.09 1074.62
Proposed Dividend 261.18 261.18
Corporate Tax on Proposed Dividend 53.17 44.39
TOTAL 478.91 1414.67
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
98
JMC Projects (India) Limited
55Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
No
te -
11
FIX
ED A
SSET
S(`
in L
acs)
Des
crip
tio
n
Gro
ss B
lock
Dep
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et B
lock
As
at
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Ad
dit
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M
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15
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at
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Tran
sfer
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&
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lus
For
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up
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s at
M
arch
31,
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As
at
Mar
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1,
2015
As
at
Mar
ch 3
1,
2014
A. T
AN
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--
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--
--
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237.
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2820
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29.7
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8.62
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53
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73
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283.
701.
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1127
8.74
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67.7
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69.3
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1.65
56.3
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8
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928.
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90
Not
es :
(1)
Th
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f th
e gr
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ther
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pert
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-inte
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ratio
ns h
ave
been
res
tate
d at
clo
sing
ex
chan
ge r
ates
of
the
fore
ign
curr
ency
and
the
res
ulta
nt e
ffec
t of
` -1
2.36
lacs
(P.
Y. `
Nil)
and
of
` -0
.43
lacs
(P.
Y. `
Nil)
hav
e be
en in
crea
sed
/ (r
educ
ed)
in a
dditi
ons
and
depr
ecia
tion
for
the
year
res
pect
ivel
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(2)
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rsua
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o th
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isio
n pr
escr
ibed
in S
ched
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II to
the
Com
pani
es A
ct, 2
013,
the
Com
pany
has
adj
uste
d an
am
ount
of `
996.
10 la
cs p
erta
inin
g to
ass
ets
who
se
usef
ul li
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as e
xhau
sted
and
aft
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tmen
t of
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38.5
7 la
cs f
or d
efer
red
tax
bala
nce,
i.e.
` 6
57.5
3 la
cs is
adj
uste
d ag
ains
t th
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enin
g Su
rplu
s ba
lanc
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Gen
eral
Res
erve
.
NO
TES
ON
FIN
AN
CIA
L ST
ATEM
ENTS
as
at M
arch
31,
201
5
99
JMC Projects (India) Ltd.56
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014
Note - 12
NON CURRENT INVESTMENTS
Trade Investments
Unquoted Equity Instruments
Investments in Subsidiaries :
Equity Shares of Subsidiary Company
(a) JMC Mining & Quarries Limited
5,00,000 ( 5,00,000 ) Equity Shares of ` 10/- each fully paid up. 50.00 50.00
(b) Brij Bhoomi Expressway Pvt. Ltd.
2,27,57,050 ( 2,27,57,000 ) Equity Shares of `10/-each fully paid up 2275.71 2275.70
Out of above, 1,16,06,070 ( 1,16,06,070 ) shares are pledged in favour of bankers of this subsidiary.
(c) Wainganga Expressway Pvt. Ltd.
3,00,00,000 ( 3,00,00,000 ) Equity Shares of `10/-each fully paid up 3000.00 3000.00
Out of above, 1,53,00,000 ( 1,53,00,000 ) shares are pledged in favour of bankers of this subsidiary.
(d) Vindhyachal Expressway Pvt. Ltd.
2,70,50,050 ( 2,70,50,000 ) Equity Shares of `10/-each fully paid up 2705.01 2705.00
Out of above, 1,37,95,500 ( 1,37,95,500 ) shares are pledged in favour of bankers of this subsidiary.
Equity Shares of Joint Venture Company
(a) Kurukshetra Expressway Pvt. Ltd.
5,16,82,990 ( 5,16,82,990 ) Equity Shares of ` 10/- each fully paid up 9826.62 9826.62
Out of above, 2,71,17,766 ( 2,71,17,766 ) shares are pledged in favour of bankers of this JV Company
Investment in Joint Venture
(a) Agrawal JMC - JV 694.60 694.81
(b) JMC - CHEC JV 360.22 232.10
TOTAL 18912.16 18784.23
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
100
JMC Projects (India) Limited
57Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014
Note - 13
LONG TERM LOANS & ADVANCES
Unsecured considered good
Advance for Capital Goods 370.01 1433.40
Loans and Advance to Related Parties
Loans to Subsidiaries (Refer Note 45) 25733.35 15310.61
Loan to Joint Venture* 4421.50 572.00
Security Deposits 889.62 1136.18
Others
Advance to Creditors 262.59 388.95
Advance VAT (Net of Payable) 3295.86 4709.60
TOTAL 34972.93 23550.74
* Loan to Joint Venture include -
Kurukshetra Expressway Pvt. Ltd. ` 4421.50 lacs ( P.Y. ` 572.00 lacs )
Note - 14
OTHER NON CURRENT ASSETS
Unsecured considered good
Long Term Trade Receivables 4073.92 2712.95
Others
Unamortized Expenses
Site Infrastructures 1173.77 1202.23
Ancilliary cost of borrowing 172.17 167.34
TOTAL 5419.86 4082.52
Note - 15
INVENTORIES
Construction Material 10371.32 12298.16
Spares,Tools & Stores 3862.96 3430.54
Work-in- Progress 10918.95 8507.43
TOTAL 25153.23 24236.13
(a) As Valued, Verified and Certified by the Management. (b) Basis of valuation is lower of cost or net realisable value.
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
101
JMC Projects (India) Ltd.58
(` in Lacs) Particulars As at
March 31, 2015 March 31, 2014Note - 16TRADE RECEIVABLESUnsecured and considered good
Debts outstanding over Six Months from due date of payment 7247.99 8132.86 Other Debts includes Retention Money ` 15906.00 lacs (P.Y. ` 13705.31 lacs) net off advances ` 10166.05 Lacs (P.Y. ` 14001.99 Lacs)
34000.57 27064.14
TOTAL 41248.56 35197.00
Note - 17CASH AND BANK BALANCESCash and Cash EquivalentsBalance with Banks
Current Accounts 1057.41 1964.57 Demand Deposits (with less than 3 months of remaining maturity) 226.64 44.00
Cash on hand 53.15 71.44 Other Bank Balance
Deposits as Margin Money against Borrowings and Commitments 127.70 313.71 Dividend Accounts (Unclaimed) 9.09 9.04
TOTAL 1473.99 2402.76
Note - 18SHORT TERM LOANS AND ADVANCESUnsecured and considered good Advance to Related Party* (Refer Note 45) 69.05 1066.96 Others
Security Deposits 1295.67 583.56 Advance Income Tax (Net of Provision) 6500.53 4550.52 Advance VAT / Entry Tax (Net of Payable) 6048.58 3193.21 Cenvat Credit Receivable 2269.69 2208.06 Excise Duty Drawback 185.79 185.79 Advance to Creditors 7896.99 5204.03 Loans and Advances to Employees 110.29 94.76 Prepaid Expenses 1113.61 1014.66
25490.20 18101.55
* Advance to Related Party Include - Kalpataru Power Transmission Ltd. ` Nil (P.Y. ` 21.19 lacs)
Note - 19OTHER CURRENT ASSETSAccrued Income 90.33 93.31 Unamortised Expenses
Site Infrastructures 3320.31 3711.94 Ancilliary cost of borrowing 90.40 94.95
Accrued value of work done 36098.42 25590.44 Receivables for Sale of Fixed Assets 5.81 12.45 TOTAL 39605.27 29503.09
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
102
JMC Projects (India) Limited
59Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
(` in Lacs) Particulars As at
March 31, 2015 March 31, 2014Note - 20
REVENUE FROM OPERATIONS
Sale of Services
Contract Revenue 239890.37 254884.92
Accrued Value of Work Done (uncertified bills) (30.40) 10310.54
Other Operating Revenue
Share of Profit in Joint Ventures 128.12 230.79
TOTAL 239988.09 265426.25
Note - 21
OTHER INCOME
Interest Income
From Deposits 37.21 55.60
From Others 541.63 46.34
Dividend Income
From Long Term Investments 0.06 0.14
Net Gain on Sale of Fixed Assets 140.93 218.85
Rent Income 263.45 77.68
Liabilities Written Back 338.39 457.53
TOTAL 1321.67 856.14
Note - 22
CONSTRUCTION MATERIALS CONSUMED
Opening Stock of Construction Materials 12298.16 11551.36
Purchases during the year 85286.78 90046.49
Scrap Sales (1287.14) (1059.86)
Closing Stock of Construction Materials (10371.32) (12298.16)
TOTAL 85926.48 88239.83
Note - 23
(INCREASE) / DECREASE IN INVENTORIES OF WORK-IN-PROGRESS
Work in Progress (at close) (10918.95) (8507.43)
Work in Progress (at commencement) 8507.43 6754.70
TOTAL (2411.52) (1752.73)
Note - 24
EMPLOYEE BENEFIT EXPENSE
Salaries, Wages and Bonus 17698.76 14888.50
Contribution to Provident & Other Funds 1032.85 881.79
Employee Share Option Scheme Expenses (44.78) (58.35)
Staff Welfare Expenses 1341.98 1176.21
TOTAL 20028.81 16888.15
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
103
JMC Projects (India) Ltd.60
(` in Lacs) Particulars For the year ended
March 31, 2015 March 31, 2014Note - 25FINANCE COSTInterest 7420.63 4253.78 Other Borrowing Costs 917.62 1192.34 Exchange Rate Variation 67.41 67.83 TOTAL 8405.66 5513.95
Note - 26OTHER EXPENSESConstruction ExpensesWork Charges 43698.59 42203.22 Composite Work Charges 43614.88 73154.74 Consumption of Spares, Tools & Stores 1340.60 941.23 Machinery - Running & Maintenance Expenses 5209.51 5209.59 Electricity Charges 1695.06 1706.43 Rent & Hire Charges 5147.03 5176.16 Security Expenses 1378.32 1234.72 Site Expenses 5699.47 5387.52 Defect Liability Period Expenses (26.40) (64.29)
107757.06 134949.32 Building & General Repairs 64.46 65.70 Vehicle Maintenance Charges 363.69 357.18 Travelling Expenses 700.40 703.98 Conveyance Expenses 88.96 90.87 Directors' Travelling Expenses 27.20 34.35 Insurance Charges 486.46 494.81 Printing & Stationery Expenses 244.26 181.70 Office Rent 594.89 569.49 Office Expenses 161.85 120.68 Postage & Telephone Charges 246.47 232.15 Professional & Legal Charges 785.78 657.79 Auditor's Remuneration 35.92 34.90 Rates & Taxes 7279.66 8671.21 Business Promotion Expenses 102.95 108.21 Advertisement Expenses 29.18 39.73 Computer & IT Expenses 277.18 279.53 Sundry Expenses* 488.37 316.83 Bank Commission & Charges 844.34 760.85 Training Expenses 22.12 40.63 Loss on Assets Lost 22.05 33.38 Loss on Investment in Joint Ventures 0.48 7.04 Exchange Rate Variation (562.82) (296.06)Sitting Fees and Commission to Non-executive Directors 44.25 28.30
120105.16 148482.57
* Note : Includes sum of ` 25 lacs spent under Corporate Social Responsibility for the purposes as allowable, pursuant to provisions of Section 135 of the Companies Act, 2013 read with rules there to.
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
104
JMC Projects (India) Limited
61Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
(` in Lacs)
26.1 Auditors’ Remuneration
Particulars 2014-15 2013-14
Audit Fees 30.67 26.97
Company Law Matters 2.25 2.25
Income Tax - 2.81
Other Services & Reports 3.00 2.88
TOTAL 35.92 34.90
27 Contingent Liabilities in respect of :
(` in Lacs)
Particulars 2014-15 2013-14
A. Bank Guarantees 6.50 17.00
B. Guarantees given in respect of performance of contracts of Subsidiaries and Joint Ventures in which Company is one of the member/holder of substantial equity
17671.21 24491.12
C. Guarantee given in favour of a subsidiary for Loan obtained by them 2250.00 -
D. Claims against the Company not acknowledged as debts (Refer note below) 263.02 640.28
E. Show Cause Notice Issued by Service Tax Authorities 5406.00 5211.28
F. Trichy Madurai Road Project Royalty Matter 39.87 39.87
G. Disputed Income Tax Demand in appeal before Appellate Authorities (Excludes Amount of ` 1794.13 (P.Y. ` 1794.13) considered in [J] hereinafter)
7610.29 7591.71
H. Disputed Income Tax Demand of Joint Ventures in appeal before Appellate Authorities (Excludes Amount of ` 214.70 (P.Y. ` 196.21) considered in [J] hereinafter)
8.77 240.08
I. Disputed VAT Demand in appeal before Appellate Authorities 4428.61 952.72
J. Income Tax (Net of Deferred Tax) on the claim made of the deductions u/s. 80-IA (4) of the Income Tax Act, 1961. (Refer note 28)
2488.32 2657.23
Note : In case where Company has raised the claims on clients against which counter claims have been raised by clients, the excess of counter claims raised by client over the amount of its claims only are considered in the above figures.
28 The Finance Act (2), 2009 has amended section 80-IA (4) of the Income Tax Act, 1961 by substituting an explanation to section 80-IA with retrospective effect from 01-04-2000. On the basis of the legal opinion of the experts and decided cases, the Company has continued to claim deduction under section 80-IA (4) of the Act on eligible projects and consequently the Company considers it appropriate not to create a liability for provision of Income Tax. However, an amount of Income tax (Net of Deferred Tax) of ` 2488.32 (P.Y. ` 2657.23) (include the amount of tax applicable on the share of profit of Joint Venture Business claiming such deduction) has been disclosed as a contingent liability in note no. 27[J] to these Accounts.
29 Capital & Other Commitments
(` in Lacs)
Particulars 2014-15 2013-14
Capital Commitments
Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of advances)
3499.00 1222.81
30 In the opinion of the Management, the assets other than Fixed Assets and Non Current Investments have a realisable value, in the ordinary course of business, approaximately of the amount at which they are stated in these financial statements. Balances of parties are subject to confirmation.
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
105
JMC Projects (India) Ltd.62
(` in Lacs)
31 C.I.F. Value of Imports
Particulars 2014-15 2013-14
Value of imports calculation on CIF Basis :
Capital Goods 552.46 1827.97
Construction Material 150.27 47.69
32 (a) Earnings in Foreign Currency
Particulars 2014-15 2013-14
Overseas Project Earnings 1,475.91 (436.69)
(b) Expenditure in Foreign Currency
Foreign Travelling 18.90 19.27
Interest 273.13 378.49
Professional, Technical and Consultancy Fees 26.32 59.10
Advertisement Expenses - 0.79
33 Lease Transactions
The Company’s significant leasing / licensing arrangements are mainly in respect of residential / office premises and equipments (operating lease). Lease agreements in respect of residential / office premises and certain equipments are cancellable and renewable by mutual consent on mutually agreed terms. Certain equipments are on non-cancellable operating lease. The aggregate lease rental / hire charges payable on these premises / equipments are charged as rent & hire charges amounting to ` 2773.50 lacs (P.Y. ` 2684.02 lacs). Future estimated minimum lease rentals and their present values in respect of non-cancellable operating leases are as under:
(` in Lacs)
Particluars < 1 Year 1 to 5 Years Total
Future minimum lease payments 211.66 - 211.66
Present value of minimum lease payments 210.75 - 210.75
34 The disclosure in respect of Provision for Defect Liability Period Expenses is as under.
(` in Lacs)
Particulars 2014-15 2013-14
Carrying amount at the beginning of the year 3831.01 3983.81
Add : Provision during the Year 303.93 319.96
Less : Reversal of provision during the Year 330.32 384.24
Less : Utilisation during the Year 39.07 88.51
Carrying amount at the end of the Year 3765.55 3831.01
35 Earning Per Share (EPS)
Particulars 2014-15 2013-14
i) Net profit after tax as per Statement of Profit and Loss attributable to Equity Shareholders (` In lacs.)
2985.88 2297.08
ii) Weighted average number of equity shares used as denominator for calculating EPS (Nos.)
26118348 26118348
iii) Basic and Diluted Earnings per Share (in `) 11.43 8.79
iv) Face Value per Equity Share (in `) 10.00 10.00
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
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36 Retirement Benefits
a. Defined Contribution Plan
The Company makes contribution towards provident fund and superannuation fund to defined contribution retirement plans for qualifying employees. The provident fund plan is operated by the regional provident fund commissioner and the superannuation fund is administered by the LIC. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement contribution schemes to fund benefits.
The Company recognised `749.79 lacs (P.Y. ` 643.64 lacs ) for Provident Fund contributions and ` 84.04 Lacs (P.Y. `111.85 lacs ) for Superannuation contributions in the Statement of Profit & Loss. The contribution payable to these plans by the Company are at rates specified in the rules.
b. Defined Benefit Plan
The Company makes annual contributions to the employee’s Group Gratuity Cash Accumulation Scheme of the Life Insurance Corporation of India and SBI Life Insurance, a funded benefit plan for qualifying employees. The scheme provides for lump sum payment to vested employees at retirement, upon death while in employment or on termination of employment of an amount equivalent to 15 days salary payable for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of service.
The present value of the defined benefit obligation and the related current service cost are measured using the projected unit credit method as per actuarial valuation carried out at balance sheet date.
The following table sets out the funded status of the gratuity plan and the amount recognised in the Company’s financial statements as at March 31, 2015.
Disclosures as per AS 15
(` in Lacs) Particulars 2014-15 2013-14i Change in benefit obligations:
Projected benefit obligation at the beginning of the year 761.42 790.93 Service Cost 182.80 179.72 Interest Cost 70.89 65.25 Actuarial (Gain) / Loss (67.52) (95.65)Liability Transferred in - - Benefits Paid (108.14) (178.83)Projected benefit obligation at the end of the year 839.45 761.42
ii Change in plan assets:Fair value of plan assets at the beginning of the year 393.14 487.50 Expected return on plan assets 34.20 42.41 Employer's contribution 14.03 46.80 Benefit paid (108.14) (178.83)Actuarial gain / (loss) (17.86) (4.74)Fair value of plan assets at the end of the year 315.37 393.14
iii Net gratuity cost for the year endedService cost 182.80 179.72 Interest of defined benefit obligation 70.89 65.25 Expected return on plan assets (34.20) (42.41)Net actuarial gain recognised in the year (49.66) (90.91)Net gratuity cost 169.83 111.65 Actual return on plan assets 16.34 37.67
iv Amount recognised in the Balance Sheet:Liability at the end of the year 839.45 761.42 Fair Value of Plan Assets at the end of the year 315.37 393.14 Amount recognised in Balance Sheet 524.09 368.28
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
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(` in Lacs) Particulars 2014-15 2013-14v Assumptions used in accounting for the gratuity plan:
Discount rate 7.94% 9.31%Salary Escalation rate 6.00% 7.00%Expected rate of return on plan assets 7.94% 8.70%
37 Related Party Disclosure as per Accounting Standard (AS) 18
Kalpataru Power Transmission Ltd. Holding Company
Subsidiary, Fellow Subsidiary Companies
JMC Mining and Quarries Ltd. Subsidiary Company
Brij Bhoomi Expressway Pvt. Ltd. Subsidiary Company
Wainganga Expressway Pvt. Ltd. Subsidiary Company
Vindhyachal Expressway Pvt. Ltd. Subsidiary Company
Energylink (India) Ltd. Subsidiary of Holding Company
Shree Shubham Logistics Ltd. Subsidiary of Holding Company
Amber Real Estate Ltd. Subsidiary of Holding Company
Adeshwar Infrabuild Ltd. Subsidiary of Holding Company
Kalpataru Power Transmission Nigeria Ltd. Subsidiary of Holding Company
Kalpataru Power Transmission (Mauritius) Ltd. Subsidiary of Holding Company
Kalpataru SA (Proprietary) Ltd. Subsidiary of Holding Company
Kalpataru Power Transmission – USA, INC. Subsidiary of Holding Company
Kalpataru Power Transmission International B.V. Subsidiary of Holding Company
LLC Kalpataru Power Transmission Ukraine Subsidiary of Holding Company
Kalpataru Power JLT, UAE Subsidiary of Holding Company
Saicharan Properties Ltd. Subsidiary of Holding Company
Gestamp Kalpataru Solar Steel Structures Pvt. Ltd. Subsidiary of Holding Company
Kalpataru Satpura Transco Pvt. Ltd. Subsidiary of Holding Company
Punarvasu Holding and Trading Co. Pvt. Ltd. Subsidiary of Holding Company
Joint Ventures
JMC - Associated JV Joint Venture
Aggrawal - JMC JV Joint Venture
JMC - Sadbhav JV Joint Venture
JMC - Taher Ali JV (Package I, II & III) Joint Venture
JMC - PPPL JV Joint Venture
Kurukshetra Expressway Pvt. Ltd. Joint Venture
KPTL-JMC-Yadav JV Joint Venture
JMC - GPT JV Joint Venture
JMC - CHEC JV Joint Venture
Key Managerial Personnel (KMP) Nature of Relationship
Mr. Shailendra Tripathi CEO & Dy. Managing Director
Mr. Manoj Kumar Singh Executive Director
Mr.Manoj Tulsian CFO & Director (Finance)
Mr. Suresh Savaliya Company Secretary
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
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Enterprises over which significant influence exercised Nature of Relationship with whom company has transactions (EUSI)
Kalpataru Limited. Significant influence of Promoters
Kalpataru Properties Pvt. Ltd. Significant influence of Promoters
Kiyana Ventures LLP Significant influence of Promoters
(` in Lacs)
Sr. No.
Particulars of Transactions with Related Parties
Holding Company
Subsidiary, Fellow
Subsidiary Companies
Joint Ventures
KMP EUSI
I. Transactions During the Year1 Capital goods - 3.61 - - -
(-) (-) (-) (-) (-)2 Other Expenses - - - - 15.31
- - - - (5.73)3 Rent Paid - - - - 357.42
(3.60) (7.17) - - (343.92)4 Reimbursement of Expenses - (5.31) - - -
- (442.03) (194.46) - -5 Sub-Contract Charges paid 4265.79 - - - -
(4957.99) - - - -6 Contract Revenue 461.62 21957.04 10885.59 - 1,326.34
(1236.69) (51004.96) (27783.48) (299.62)7 Managerial Remuneration - - - 482.88 -
- - - (307.08) -8 Interest Income - - - - -
- (2.89) - - -9 Share of Profit in Joint Venture - - 128.12 - -
- - (230.79) - -10 Share of Loss in Joint Venture - - 0.48 - -
- - (7.04) - -II. Balance as on 31.03.2015 - - - - -1 Trade Receivables # 82.62 (1214.71) 1496.07 - 154.25
(32.27) (4968.00) (4633.07) - (225.36)2 Guarantees given - 2916.00 - - -
- (8995.00) - - -3 Liabilities at the end of the year 1557.90 - 160.93 - 4.81
(1602.09) - (160.66) - (97.79)4 Loans & Advances given - 25802.39 4,425.44 - -
(359.88) (16356.38) (572.00) - -5 Advance taken from Clients ^ - 2428.77 2845.60 - 1,059.43
- (6228.33) (2817.00) - (661.35)6 Investment in Joint Venture entity - - 1,054.82 - -
- - (926.91) - -7 Investment in Shares - 8030.71 9826.62 - -
- (8030.70) (9826.62) - -
# Trade Receivables herein are Gross amount before Adjustment of Advances received from clients
^ Advances taken from clients herein are Gross amount before adjustment of Trade Receivables.
Note: Figures shown in bracket represents corresponding amounts of previous year.
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
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38 Disclosure as per Accounting Standard (AS) 7
(` in Lacs)
Particulars 2014-15 2013-14
(1) Contract revenue recognized as revenue during the year 239859.97 265195.46
(2) Contract costs incurred and recognized profit less recognized losses 535506.47 661149.46
(3 ) Advances Received 35438.25 38157.35
(4) Retention Amount 10760.34 10407.09
(5) Gross amount Due from Customers 42676.89 45728.76
Note : The information in point no. (2) to (5) are in respect of contracts in progress as on March 31, 2015.
39 Segmental Reporting
The Company recognizes construction as the only business segment, hence there are no reportable segments under AS 17.
40 Joint Ventures
I The Company is having consortium Joint Ventures named JMC-Associated JV, JMC-Taher Ali JV (Package I, II & III), JMC- PPPL JV, JMC ATEPL JV, JMC - GPT- Vijaywargi - Bright Power JV, JMC- Vijaywargi - Bright Power JV, KPTL - JMC - Yadav JV and JMC - GPT JV under work sharing arrangement. The revenue for work done is accounted, in accordance with the accounting policy followed by the Company, as that of independent contract to the extent work is executed.
II In respect of contracts executed in Joint Venture entities, the services rendered to the Joint Venture entities are accounted as revenue for the work done. The share of profit / loss in Joint Venture entities other than Joint Venture Company has been accounted for and the same is reflected as investments or current liabilities in books of the Company.
The details of Joint Venture entities :
Name of the Joint Venture Name of Venture Partner Method of Accounting Share of Interest
a. Aggrawal - JMC JV Dinesh Chandra Aggrawal Infracon Pvt.Ltd. Percentage of Completion 50.00%
b. JMC - Sadbhav JV Sadbhav Engineering Ltd. Percentage of Completion 50.50%
c. Kurukshetra Expressway Pvt. Ltd. SREI Infrastructure Finance Ltd. Percentage of Completion 49.57%
d. JMC - CHEC JV China Harbour Enginering Company Ltd. Percentage of Completion 49.00%
Details of proportionate share in the Assets, Liabilities, Income and Expenditure of the Company in its Joint Venture entities are given below.
(` in Lacs)
Particulars Aggrawal JMC JV JMC Sadbhav JVKurukshetra Expressway
Pvt. Ltd.JMC CHEC JV
2014-15 2013-14 2014-15 2013-14 2014-15 2013-14 2014-15 2013-14
% of Holding 50.00% 50.00% 50.50% 50.50% 49.57% 49.57% 49.00% 49.00%
Assets 400.07 411.36 1,014.16 1,014.25 49,907.66 50,404.68 2,474.51 1,574.29
Liabilities 52.78 63.96 1,093.36 1,093.33 44,910.09 42,147.17 2,298.00 1,460.56
Income 1.69 - - - 3,291.60 1,677.12 5,849.19 5,616.48
Expenditure 1.79 0.74 0.14 - 6,551.54 3,257.48 5,776.50 5,503.39
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
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41 Employees Stock Option
The Company has provided share-based payment plan to its employees for the year ended March 31, 2015. The Company has followed Intrinsic Value Method and has given accounting treatment as per Guidelines issued by Securities & Exchange Board of India. The details are as follows:
Name of the Scheme ESOP -2007
Date of Grant 21st July, 2007
Number of options granted 600000
Method of Settlement (Cash / Equity) Equity
Vesting Period 4 Years
Vesting Conditions
Exercise Period Within 4 Years from the date of vesting
Grant Price ` 217/- per Option
Method of Accounting Intrinsic Value Method
The details of activity under ESOP - 2007 have been summarised below:
(` in Lacs)
Particulars
2014-15 2013-14
Number of Options
Weighted Average Exercise
Price (`)
Number of Options
Weighted Average Exercise
Price (`)
Outstanding at the beginning of the year 139655 - 245751 -
Add: Granted during the year - - - -
Less: Forfeited during the year - - - -
Exercised during the year - - - -
Expired during the year 81420 - 106096 -
Outstanding at the end of the year 58235 - 139655 -
Unvested at the end of the year - - - -
Exercisable at the end of the year 58235 - 139655 -
Fair value of options granted on the date of grant - 126.57 - 126.57
Fair Value Methodology The fair value of options to compute proforma net income and earning per share is taken based on the report of an independent valuer using “Black & Scholes Model”. The key assumptions and the fair value are as under:
Particulars
Risk Free Interest Rate (%) 7.56%
Option Life (Years) 4 Years
Expected Volatility 57%
Expected Dividend Yield (%) 0.55%
Weighted Average Fair Value per Option (`) 126.57
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
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Proforma AccountingHad the compensation cost for the stock options granted under ESOP - 2007 been recognized based on fair value at the date of grant in accordance with Black & Scholes Model, the proforma amount of net profit and earning per share of the Company would have been as under.
(` in Lacs)
Particulars 2014-15 2013-14
Profit as reported for calculation of Basic EPS 2985.88 2297.08
Add: Employee Stock Compensation under intrinsic value method (44.78) (58.35)
Adjusted Proforma Profit for calculation of Basic EPS 2941.10 2238.73
Earning Per Share - Basic
- As reported (in `) 11.43 8.79
- Proforma (in `) 11.26 8.57
Profit as reported for calculation of Diluted EPS 2985.88 2297.08
Add: Employee Stock Compensation under intrinsic value method (44.78) (58.35)
Adjusted Proforma Profit for calculation of Diluted EPS 2941.10 2238.73
Earning Per Share - Diluted
- As reported (in `) 11.43 8.79
- Proforma (in `) 11.26 8.57
42 Micro & Small Enterprises
The disclosure in respect of the amount payable to enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006 has been made in the Financial statement as at March 31, 2015 based on the information received and available with the Company. On the basis of such information, credit balance of such enterprises is NIL as at March 31, 2015. Auditors have relied upon the information provided by the Company.
43 The Management is of the opinion that as on the Balance Sheet date, there are no indications of a material impairment loss on Fixed Assets, hence the need to provide for impairment loss does not arise.
44 Pursuant to Companies Act, 2013 (the Act), effective from April 1, 2014, the Company has revised depreciation rates on fixed assets based on useful life specified in Schedule II of the Act or assessed on technical evalation by the management as mentioned in significant accounting policies in these financials statements which is not longer than useful life specified in aforesaid Schedule II of the Act. As a result of the change, depreciation charge for the year ended March 31, 2015 is lower by ` 1425.43 lacs. In respect of assets whose useful life is already exhausted as on April 1, 2014 sum of ` 996.10 lacs, i.e. ` 657.53 lacs (net of deferred tax) has been adjusted against the opening balance of General reserve in these financial staments in accordance with Schedule II of the Act.
45 Information as required under Clause 32 of Listing Agreement with Stock Exchanges with regard to Loans to Subsidiaries which are without interest and having no repayment schedule:
(` in Lacs)
ParticularsAs at March 31,
2015Maximum Balance
during the yearAs at March 31,
2014Maximum Balance
during the year
Non Current :
(1) Brijbhoomi Expressway Pvt. Ltd. 3,739.35 3,978.43 2,297.84 3,481.99
(2) Wainganga Expressway Pvt. Ltd. 9,771.00 9,771.00 6,670.00 6,670.00
(3) Vindhyachal Expressway Pvt. Ltd. 12,223.00 12,223.00 6,342.77 6,342.77
Current :
(1) Brijbhoomi Expressway Pvt. Ltd. - - 999.15 3481.99
(2) JMC Mining & Quarries Ltd. 69.05 71.62 46.62 46.62
Note : All the above loans and advances have been given for business purposes only.
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
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46 The company has entered into derivative contracts including forward contracts to hedge its risk associated with foreign currency fluctuations. Company does not use derivative contracts including forward contracts for speculative purpose.
(a) The particulars of derivatives including forward contracts entered into for hedging purposes and outstanding are as under :
(` in Lacs)
Category of Derivative instruments hedge As at March 31, 2015 As at March 31, 2014
Currency Swaps 2,832.76 4,605.10
Naturally Hedge 2,213.36 -
(b) Unhedged Foreign Currency exposure outstanding are as under :
The foreign currency exposure that is not hedged by derivative instruments amounts to ` 1,900.64 lacs (P.Y. ` 1,581.68 lacs).
47 Previous Year figures have been regrouped and / or rearranged wherever considered necessary.
Signatures to Significant Accounting Policies and Notes on Financial Statements 1 to 47
NOTES ON FINANCIAL STATEMENTS as at March 31, 2015
As per our report attached For and on behalf of the Board of DirectorsFor Kishan M. Mehta & Co.Chartered Accountants Shailendra Kumar Tripathi Manoj TulsianFirm Registration No. 105229W CEO & Dy. Managing Director CFO & Director (Finance)
Kishan M. Mehta Manoj Kumar Singh Suresh SavaliyaPartner Executive Director Company SecretaryMembership No. 13707
Mumbai, May 29, 2015 Mumbai, May 28, 2015
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INDEPENDENT AUDITOR’S REPORTTo
The Members of
JMC Projects (India) Limited.
Report on the Consolidated Financial Statements
We have audited the accompanying consolidated financial statements of JMC Projects (India) Limited (Hereinafter referred to as “the Holding Company”) and its subsidiaries (the Holding Company and its subsidiaries together referred to as “the Group”) and its a jointly controlled company, comprising of the Consolidated Balance Sheet as at March 31, 2015, the Consolidated Statement of Profit and Loss and the Consolidated Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “the consolidated financial statements”).
Management’s Responsibility for the Consolidated Financial Statements
The Holding Company’s Board of Directors is responsible for the preparation of these consolidated financial statements in terms of the requirements of the Companies Act, 2013 (hereinafter referred to as “the Act”) that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Group including its jointly controlled company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. The respective Board of Directors of the companies included in the Group and of its jointly controlled company is responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Group and for preventing and detecting frauds and other irregularities; the selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the consolidated financial statements by the Directors of the Holding Company, as aforesaid.
Auditor’s Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. While conducting the audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Holding Company’s preparation of the consolidated financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on whether the Holding Company has an adequate internal financial controls system over financial reporting in place and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Holding Company’s Board of Directors, as well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence obtained by us and the audit evidence obtained by the other auditors in terms of their reports referred to in sub-paragraph (a) of the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the consolidated financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidated financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the consolidated state of affairs of the Group and Its jointly controlled company as at March 31, 2015, and their consolidated loss and their consolidated cash flows for the year ended on that date.
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Other Matters
We did not audit the financial statements of subsidiaries and jointly controlled company, whose financial statements reflect total assets of Rs. 181,661.42 Lacs as at March 31, 2015, total revenues of Rs. 6,988.21 Lacs and net cash flows amounting to Rs. 272.08 Lacs for the year ended on that date, as considered in the consolidated financial statements. These financial statements have been audited by other auditors whose reports have been furnished to us by the management and our opinion on the consolidated financial statements, in so far as it relates to the amounts and disclosures included in respect of these subsidiaries and jointly controlled company, and our report in terms of sub-sections (3) and (11) of Section 143 of the Act, insofar as it relates to the aforesaid subsidiaries and jointly controlled company, is based solely on the reports of the other auditors.
Our opinion on the consolidated financial statements, and our report on Other Legal and Regulatory requirements below, is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors and the financial statements certified by the management.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor’s Report) Order, 2015 (“the Order”), issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act, based on the comments in the auditors’ reports of the Holding Company, subsidiaries and jointly controlled company, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. As required by Section143(3) of the Act, we report, to the extent applicable, that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit of the aforesaid consolidated financial statements;
(b) In our opinion, proper books of account as required by law relating to preparation of the aforesaid consolidated financial statements have been kept so far as it appears from our examination of those books and the reports of the other auditors;
(c) The Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss, and the Consolidated Cash Flow Statement dealt with by this Report are in agreement with the relevant books of account maintained for the purpose of preparation of the consolidated financial statements;
(d) In our opinion, the aforesaid consolidated financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;
(e) On the basis of the written representations received from the directors of the Holding Company as on March 31, 2015 taken on record by the Board of Directors of the Holding Company and the reports of the auditors of its subsidiaries and jointly controlled company, none of the directors of the Group companies and jointly controlled company is disqualified as on March 31, 2015 from being appointed as a director in terms of Section 164 (2) of the Act;
(f) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditor’s) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The consolidated financial statements disclose the impact of pending litigations on the consolidated financial position of the Group and jointly controlled company – Refer Note 27 & 28 to the consolidated financial statements;
ii. The provision has been made, as required under the applicable law or accounting standards, for material foreseeable losses, on long-term contracts including derivative contracts;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by
the Holding Company, its subsidiaries and jointly controlled company.
For KISHAN M.MEHTA & CO.,
Chartered Accountants
Firm’s Registration No.105229W
Place : Mumbai (K.M.MEHTA)
Date : May 29, 2015 Partner
Membership No. : 13707
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ANNEXURE TO THE AUDITORS’ REPORT(Referred to in paragraph 1 under Report on Other Legal and Regulatory Requirements of our report of even date)
(i) a) The Holding Company, its subsidiaries and jointly controlled company, have maintained proper records showing full particulars including quantitative details and situation of fixed assets;
b) The fixed assets have been physically verified by the management of the respective companies in reasonable interval and according to the information and explanation given to us and based on auditors’ reports of the subsidiaries and jointly controlled company, no material discrepancies have been noticed on such verification.
(ii) a) The inventory has been physically verified by the management of the Holding Company and its one subsidiary during the year at reasonable intervals.
b) In our opinion and according to the information and explanations given to us and based on the auditors report of the subsidiary, the procedures of physical verification of inventory followed by the management of the Holding Company and subsidiary are reasonable and adequate in relation to the size of the Company and the nature of its business.
c) In our opinion and according to information and explanation given to us and based on auditors report of the subsidiary, the Holding Company and the subsidiary are maintaining proper records of inventory and in our opinion, discrepancies noticed on physical verification of stocks were not material.
(iii) The Holding Company and based on auditors reports of the subsidiaries and jointly controlled company its subsidiaries and jointly controlled company, have not granted any loan, secured or unsecured, to companies, firms or other parties covered in the register maintained under section 189 of the Act.
(iv) In our opinion and according to the information and explanation given to us, and based on the auditors’ reports of the subsidiaries and jointly controlled company, there is an adequate internal control system commensurate with the size and the nature of its business with regard to purchases of inventory and fixed assets and sale of goods and services. During the course of our audit, and based on the auditors’ reports of the subsidiaries and jointly controlled company, we have not observed any continuing failure to correct major weaknesses in internal control system.
(v) In our opinion and according to the information and explanation given to us the Holding Company has complied with the directives issued by the Reserve Bank of India and the provisions of section 73 to 76 or any other relevant provisions of the Companies Act and the rules framed thereunder in relation to the deposits. On the basis of the auditors’ report of the subsidiaries and jointly controlled company, they have not accepted any deposits during the year and therefore provisions of Clause 3(v) of the Order are not applicable to them.
(vi) On the basis of review of the books of accounts broadly by us as maintained by the Holding Company and on the basis of auditor’s report of jointly controlled Company as to review of the books of accounts broadly by them as maintained by the jointly controlled Company, pursuant to the rules made by the Central Government of India, regarding the maintenance of cost records under sub section (1) of section 148 of the Companies Act, 2013, we are of the opinion that prima facie, the prescribed accounts and records have been maintained but we and the auditors of jointly controlled entity respectively have, however not made a detailed examination of the records with a view to determine whether they are accurate or complete. On the basis of the auditor’s reports of the subsidiaries, the provisions of clause 3(vi) of the order are not applicable to them.
(vii) a) According to the information and explanations given to us and the records examined by us, and based on auditors’ reports of subsidiaries and joint stock company, the respective companies are regular in depositing with appropriate authorities the undisputed statutory dues including Provident Fund, Employees’ State Insurance, Income-tax, Sales-tax, Wealth tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and any other material statutory dues applicable to it, except that the jointly controlled company has delayed in payment of statutory dues towards Provident Fund, Income-tax, TDS, Sales-tax and WCT with respective authorities however there are no arrears outstanding as at the reporting date for more than six month except in respect of works contract tax amounting to Rs. 6.66 lacs of Holding Company’s share in the consolidated financial statements the same has been paid till the date of this report.
b) According to the information and explanations given to us, and based on the auditors’ reports of subsidiaries and jointly controlled company details of dues of Income Tax, Sales Tax, Wealth Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax and Cess which have not been deposited on account of dispute are given below.
Name of the Statute Particulars Period of which the amount relates
Forum where the dispute is pending
Amount (` In Lacs)
Finance Act, 1994 Service Tax 2007-08 to 2009-10 Customs, Excise and Service Tax Appellate Tribunal, Ahmedabad
2898.09
Finance Act, 1994 Service Tax 2008-09 to 2012-13 Customs, Excise and Service Tax Appellate Tribunal, Ahmedabad
2505.73
Finance Act, 1994 Service Tax 1997-98 Customs, Excise and Service Tax Appellate Tribunal, Ahmedabad
2.18
The West Bengal VAT Act, 2003 VAT 2008-09 West Bengal Commercial Taxes Appellate and Revisional Board
57.10
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Name of the Statute Particulars Period of which the amount relates
Forum where the dispute is pending
Amount (` In Lacs)
The West Bengal VAT Act, 2003 VAT 2009-10 West Bengal Commercial Taxes Appellate and Revisional Board
105.80
The West Bengal VAT Act, 2003 VAT 2011-12 Dept. Commissioner Kolkata 0.37
Madhya Pradesh VAT Act, 2002 VAT 2007-08 & 2008-09 High Court 295.17
Madhya Pradesh VAT Act, 2002 VAT 2009-10 Addl. Commissioner Appeals 8.47
Madhya Pradesh VAT Act, 2002 Entry Tax 2008-09 High Court 52.05
Madhya Pradesh VAT Act, 2002 Entry Tax 2009-10 Addl. Commissioner Appeals 6.59
Gujarat VAT Act, 2003 VAT & CST 2006-07 Gujarat VAT Tribunal 261.72
Gujarat VAT Act, 2003 VAT & CST 2009-10 Asst. Commissioner of Commercial Appeals
125.40
Maharashtra VAT Act, 2002 VAT 2006-07 Dept. Commissioner of Sales Tax 145.10
Maharashtra VAT Act, 2002 VAT 2007-08 Joint Commissioner of Sales Tax 15.10
Maharashtra VAT Act, 2002 VAT 2008-09 Dept. Commissioner of Sales Tax 789.18
Uttaranchal VAT matter VAT 2010-11 Dept. Commissioner of Commercial Tax
549.00
New Delhi VAT matter VAT 2012-13 & 2013-14 Objection Hearing Authority Sales Tax department Delhi
521.80
Income Tax Act, 1961 Income Tax 2006-07 to 2011-12 Commissioner (Appeals) 1539.11
Tamil Nadu Minor Mineral Concession Rules
Royalty 2006-07 Principal Secretary / Joint Secretary, Industries.
39.87
c) The Holding Company, its Subsidiary companies and jointly controlled company have transferred the required amount to Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 and rules made there-under within time.
(viii) That on the basis of consolidated financial statements there are no accumulated losses as on March 31, 2015 and no cash losses are incurred during the financial year covered by our audit and in the immediately preceding financial year.
(ix) In our opinion and according to the information and explanations given to us and based on the auditors’ reports of the subsidiaries and jointly controlled company the respective companies have not defaulted in repayment of dues to banks, financial institutions and debentures holders except that jointly controlled company has not been regular in repayment of dues to banks and as at the reporting date the installment for the quarter ended March 31, 2015 due on 31-March-2015 amounting to Rs. 1.48 Crore of Holding Company’s share in the consolidated financial statements and interest from the month of January 2015 to March 2015 aggregating to Rs. 12.39 Crore of Holding Company’s share in the consolidated financial statements have not been paid but such dues of installment and interest have been paid till the date of this report.
(x) According to the information and explanations given to us, the Holding Company has given guarantee for loans taken by a subsidiary company from banks and financial institutions of Rs 22.50 Crore and the terms and conditions whereof are not prejudicial to the interest of the company.
(xi) According to the information and explanations given to us and based on the auditors’ reports of the subsidiaries and jointly controlled company , in our opinion the term loans raised by the respective companies have been applied for the purpose for which they were obtained.
(xii) Based upon the audit procedures performed for the purpose of reporting the true and fair view of consolidated financial statements and as per the information and explanations given to us and based on the auditors’ reports of the subsidiaries and jointly controlled company, we report that no fraud on or by the Holding Company, its subsidiaries and jointly controlled company has been noticed or reported during the course of our audit.
For KISHAN M.MEHTA & CO., Chartered Accountants
Firm’s Registration No.105229W
Place: Mumbai (K.M.MEHTA) Date : May 29, 2015 Partner
Membership No. : 13707
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CONSOLIDATED BALANCE SHEET as at March 31, 2015 (` in Lacs)
Particulars Note No. As at March 31, 2015 March 31, 2014
EQUITY AND LIABILITIESShareholders' Funds(a) Share Capital 1 2611.83 2611.83 (b) Reserves and Surplus 2 39112.87 42454.05
41724.70 45065.88 Non Current Liabilities(a) Long-Term Borrowings 3 162594.55 129151.87
(b) Other Long Term Liabilities 5 32583.53 22712.02 (c) Long-Term Provisions 6 4461.86 3402.31
199639.94 155266.20 Current Liabilities(a) Short-Term Borrowings 7 26839.65 13447.32 (b) Trade Payables 8 60682.21 57152.17 (c) Other Current Liabilities 9 24869.20 17480.32 (d) Short-Term Provisions 10 486.31 1419.59
112877.37 89499.40 TOTAL 354242.01 289831.48 ASSETSNon-Current Assets(a) Fixed Assets (i) Tangible Assets 11A 31892.50 27491.66 (ii) Intangible Assets 11B 170410.81 40381.41 (iii) Capital Work-in-Progress 11C 8.07 928.90 (iv) Intangible Assets under Development 11D 3202.12 103748.59
205513.50 172550.56 (b) Non Current Investments 12 1054.82 926.91 (c) Deferred Tax Assets (Net) 4 1533.88 1658.07 (d) Long-Term Loans and Advances 13 7093.22 8007.57 (e) Other Non-Current Assets 14 5419.86 4083.06
220615.28 187226.17 Current Assets(a) Inventories 15 25166.48 24250.76 (b) Trade Receivables 16 40671.00 25770.83(c) Cash and Bank Balances 17 2226.91 2883.60 (d) Short-Term Loans and Advances 18 25956.84 20197.34 (e) Other Current Assets 19 39605.50 29502.78
133626.73 102605.31 TOTAL 354242.01 289831.48 Significant Accounting PoliciesSee accompanying Notes to the Financial Statements 1 to 40
As per our report attached For and on behalf of the Board of DirectorsFor Kishan M. Mehta & Co.Chartered Accountants Shailendra Kumar Tripathi Manoj TulsianFirm Registration No. 105229W CEO & Dy. Managing Director CFO & Director (Finance)
Kishan M. Mehta Manoj Kumar Singh Suresh SavaliyaPartner Executive Director Company SecretaryMembership No. 13707
Mumbai, May 29, 2015 Mumbai, May 28, 2015
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75Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
CONSOLIDATED STATEMENT OF PROFIT AND LOSS for the year ended March 31, 2015
(` in Lacs)
Particulars Note No. For the year ended
March 31, 2015 March 31, 2014
INCOME
Revenue from Operations 20 246977.89 266371.43
Other Income 21 1330.20 857.92
TOTAL REVENUE 248308.09 267229.35
EXPENSES
Construction Materials Consumed 22 85926.48 88239.83
(Increase) / Decrease in Inventories of Work-in-Progress 23 (2410.18) (1742.12)
Employee Benefit Expense 24 20128.33 16915.15
Finance Cost 25 15976.83 7895.89
Depreciation and Amortization Expense 11 6500.28 6100.62
Other Expenses 26 123239.18 150146.21
TOTAL EXPENSES 249360.92 267555.58
Profit before exceptional and extraordinary items and tax (1052.83) (326.23)
Exceptional Items - -
Profit before extraordinary items and tax (1052.83) (326.23)
Extraordinary Items - -
Profit before tax (1052.83) (326.23)
Tax Expense :
Current Tax 914.54 633.15
Deferred Tax 462.77 102.12
Profit / (Loss) for the year (2430.14) (1061.50)
Earnings per equity share : [Nominal value `10/- per share]
Basic (in `) (9.30) (4.06)
Computed on the basis of profit for the year
Diluted (in `) (9.30) (4.06)
Computed on the basis of profit for the year
Significant Accounting Policies
See accompanying Notes to the Financial Statements 1 to 40
As per our report attached For and on behalf of the Board of DirectorsFor Kishan M. Mehta & Co.Chartered Accountants Shailendra Kumar Tripathi Manoj TulsianFirm Registration No. 105229W CEO & Dy. Managing Director CFO & Director (Finance)
Kishan M. Mehta Manoj Kumar Singh Suresh SavaliyaPartner Executive Director Company SecretaryMembership No. 13707
Mumbai, May 29, 2015 Mumbai, May 28, 2015
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CONSOLIDATED CASH FLOw STATEMENT for the year ended March 31, 2015
(` in Lacs) Particulars For the year ended
March 31, 2015 March 31, 2014A. CASH FLOW FROM OPERATING ACTIVITIES PROFIT BEFORE TAX AND EXTRAORDINARY ITEMS (1052.83) (326.23) ADD / (DEDUCT) ADJUSTMENTS FOR : Depreciation 6500.28 6100.62 Interest Paid 15976.83 7895.89 Unrealised (Profit) / Loss from Exchange Rate Variation 16.15 (44.10) Amortization of ancillary cost & Site Infrastructures 3014.55 3167.37 Loss on Assets Lost 22.05 33.38 Deferred Employee Compensation written back (44.78) (58.35) Interest Income (580.76) (99.05) Dividend Income (0.06) (0.24) (Profit) / Loss on Sale of Assets (Net) (144.74) (220.40) Share of Profit from Investment in Joint Venture (128.12) (230.79) Share of Loss from Investment in Joint Venture 0.48 7.04 OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 23579.05 16225.14 ADJUSTMENTS FOR : Trade & Other Receivables (33324.40) (27035.33) Inventories (915.72) (3080.60) Trade & Other Payables 20822.13 25814.98 CASH GENERATED FROM OPERATIONS 10161.06 11924.19 Direct Taxes Paid (2852.92) (2741.80) NET CASH FLOW FROM OPERATING ACTIVITIES 7308.14 9182.39 B. CASH FLOW FROM INVESTING ACTIVITIES Investment in Fixed Assets (7940.43) (50246.63) Investment in Intangible Assets under Development (31116.59) (16640.40) Sale of Fixed Assets 333.25 830.74 Share of Profit from Investment in Joint Venture 128.12 230.79 Share of Loss from Investment in Joint Venture (0.48) (7.04) Deposit with Banks 185.96 (184.51) Non-Current Investments (127.91) (225.78) Interest Received 580.76 99.05 Dividend Received 0.06 0.24 NET CASH FLOW FROM INVESTING ACTIVITIES (37957.26) (66143.54)C. CASH FLOW FROM FINANCING ACTIVITIES Proceeds from Issue of Equity Share Capital / Securities Premium - 0.11 Proceeds from Grant-in-aid - 4950.00 Proceeds from Term Borrowings 41716.79 64710.07 Repayment of Term Borrowings (8274.11) (5292.25) Working Capital Finance 13392.33 (1603.23) Interest Paid (16351.05) (6356.59) Dividend Paid (261.18) (261.18) Corporate Dividend Tax Paid (44.39) (44.39) NET CASH FLOW FROM FINANCING ACTIVITIES 30178.39 56102.54 NET INCREASE / (DECREASE) IN CASH PAID & CASH EQUIVALENTS (470.73) (858.60) OPENING BALANCE OF CASH & CASH EQUIVALENTS 2559.86 3418.46 CLOSING BALANCE OF CASH & CASH EQUIVALENTS 2089.13 2559.86 Previous Year figures have been regrouped and / or rearranged wherever considered necessary.
As per our report attached For and on behalf of the Board of DirectorsFor Kishan M. Mehta & Co.Chartered Accountants Shailendra Kumar Tripathi Manoj TulsianFirm Registration No. 105229W CEO & Dy. Managing Director CFO & Director (Finance)
Kishan M. Mehta Manoj Kumar Singh Suresh SavaliyaPartner Executive Director Company SecretaryMembership No. 13707
Mumbai, May 29, 2015 Mumbai, May 28, 2015
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77Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
SIGNIFICANT ACCOUNTING POLICIES i Consolidation of Accounts
The Consolidated Financial Statements are prepared in accordance with Accounting Standard AS 21 on “Consolidated Financial Statements” and Accounting Standard AS 27 on “Financial Reporting of Interests in Joint Ventures” issued by the Institute of Chartered Accountants of India. The Consolidated Financial Statements comprise the financial statements of JMC Projects (India) Ltd. (hereinafter referred to as ‘Holding Company’), its subsidiaries, JMC Mining and Quarries Ltd., Brijbhoomi Expressway Pvt. Ltd., Wainganga Expressway Pvt. Ltd., Vindhyachal Expressway Pvt. Ltd. and Jointly Controlled Entity, Kurukshetra Expressway Pvt. Ltd.
ii Basis of Accounting
The financial statements have been prepared under the historical cost convention, on accrual basis, in accordance with the generally accepted accounting principles (GAAP) in India and applicable Accounting Standards referred to under Section 133 of the Companies Act, 2013 read with rule 7 of the Companies (Accounts) Rules, 2014.
iii Principles of Consolidation
a The financial statement of the subsidiary companies and Jointly Controlled Entity (JCE) used in the consolidation are drawn up to the same reporting date as of the Company.
b The consolidated financial statements of the Company and its subsidiaries have been combined on line to line basis by adding together like items of assets, liabilities, income and expenses. Inter company balances, transactions and unrealised profits or losses have been fully eliminated.
c The Company’s interest in Jointly Controlled Entity (JCE) is proportionately consolidated on a line-by-line basis by adding together the book values of assets, liabilities, income and expenses. Unrealised profit / loss on inter company transactions and inter company balances to the extent applicable, have been eliminated except in three such entities, the interest have been reported by not using proportionate consolidation but only share in profit / loss from Joint Venture Entities have been accounted for, for the reasons explained in note no. 36(II) herein.
iv Use of Estimates
The presentation of consolidated financial statements requires certain estimates and assumptions. These estimates and assumptions affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual result and estimates are recognized in the period in which the results are known / materialized.
v Revenue Recognition
a. Construction Revenue
Running Account Bills for work completed are recognized on percentage of completion method based on completion of physical proportion of the contract work. Income on account of claims and extra item work are recognized to the extent Company expects reasonable certainty about receipts or acceptance from the client. When it is probable that total contract cost will exceed the total contract revenue, the expected loss is recognized immediately.
b. Revenue from Toll Collection
Revenue from toll is accounted for on the basis of usage charges recovered from the users of the toll. Toll Revenue in the form of periodic pass(es) are accounted for as income in the period in which the same are received.
c. Others
Dividends are recorded when the right to receive the payment is established. Interest income is recognized on time proportionate basis.
vi Fixed Assets
Fixed Assets are stated at cost less accumulated depreciation less impairment losses, if any. Cost is inclusive of all identifiable expenditure incurred to bring the assets to their working condition for intended use. When an asset is disposed off, demolished or destroyed, the cost and related depreciation are removed from the books of accounts and resultant profit or loss, is reflected in the Statement of Profit & Loss. Direct cost as well as related incidental and identifiable expenses incurred on acquisition of fixed assets that are not yet ready for their intended use or put to use as at the Balance Sheet date are stated as Capital Work in Progress.
Intangible Assets under Development:
All projects related expenditure for acquisition of toll collection rights viz. civil works, machinery under erection, construction and erection materials, pre-operative expenditure, expenditure indirectly related to the project and incidental to setting up project facilities, borrowing cost incurred prior to the date of commercial operation and trial run expenditure are shown under Intangible Assets under development. These expenses are net of recoveries, claims and income (net of tax), if any, from surplus funds arising out of project specific borrowings.
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SIGNIFICANT ACCOUNTING POLICIES vii Depreciation / Amortisation
i. Tangible Assets :
Depreciation on tangible assets is provided for on the basis of straight-line method, except that depreciation on assets for Mining activities is provided at WDV method, on pro rata as per the useful life prescribed in Schedule II to the Companies Act, 2013 or as per the useful life assessed by the management based on technical evaluation which is not longer than useful life specified in Schedule-II as follows:
a. Useful life of Plant & Equipment assessed 3 years in place of 12 years as per Schedule II
b. Useful life of several Plant & Equipments assessed 10 years in place of 12 years as per Schedule II
ii. Intangible Assets :
Depreciation on intangible assets is provided on straight line method over the estimated useful life of 3 years.
Amortisation in respect of Toll Collection Rights is provided on the basis of Actual Revenue generated during the toll period divided by Projected Revenue for the entire Concession period as prescribed under Schedule - II of the Companies Act, 2013.
viii Impairment of Assets
The carrying cost of assets is reviewed at each Balance Sheet date to determine whether there is any indication of impairment of assets. If any indication exists, the recoverable value of such assets is estimated. An impairment loss is recognized when the carrying cost of assets exceeds its recoverable value. An impairment loss is reversed, if there has been a change in the estimates used to determine the recoverable amount and recognised in compliance with AS - 28.
ix Investments
Investments are stated at cost. Provision for diminution in the value of long term investments is made, only if, such a decline is other than temporary in the opinion of the Management.
x Retirement Benefits
a. Gratuity liability is covered by payment there of to Gratuity fund, the defined benefit plan under Group Gratuity Cash Accumulation Scheme of LIC of India and SBI Life Insurance under irrevocable trust. The Company’s liability towards gratuity are determined on the basis of actuarial valuation done by independent actuary.
b. Contribution to Provident Fund and Superannuation Fund, the defined contribution plans as per the schemes, are charged to the Statement of Profit & Loss.
c. Provision for Leave encashment liability is made based on actuarial valuation as at the Balance Sheet date.
d. All other short-term benefits for employees are recognised as an expense at the undiscounted amount in the Statement of Profit & Loss of the year in which the related service is rendered.
xi Inventories
a. Construction materials, stores and spares are valued at lower of cost or net realizable value. Cost include cost of purchase and other expenses incurred in bringing inventory to their respective present location and condition. Cost is determined using FIFO method of inventory valuation.
b. Work in progress is valued at lower of cost or net realizable value.
xii Provision for Taxes
a. Current Tax:
Tax on income for the current period is determined on the basis of estimated taxable income and tax credit computed in accordance with provisions of the Income Tax Act, 1961.
b. Deferred Tax:
Deferred tax is recognized, on timing differences, being the difference between the taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. It is calculated using the applicable tax rates and tax laws that have been enacted or substantially enacted as on the balance sheet date. Deferred tax assets which arises mainly on account of unabsorbed depreciation and payments u/s. 40(a)(ia) & 43B of the Income Tax Act, 1961 are recognized and carried forward only to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realized.
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Corporate Overview Statutory Reports Financial Reports
SIGNIFICANT ACCOUNTING POLICIES xiii Foreign Currency
a Transactions denominated in Foreign Currency are recorded at the exchange rate prevailing on the date of transaction.
b In respect of transactions covered by forward exchange contracts, the difference between the forward rate and the exchange rate at the date of the transaction is recognized as income or expense over the life of the contract. Any income or expense on account of exchange rate difference either on settlement or on translation is recognized in the Statement of Profit & Loss.
c Assets & Liabilities remaining unsettled at the end of the year, other than covered by forward exchange contracts are translated at exchange rate prevailing at the end of the year and the difference is adjusted in the Statement of Profit & Loss.
d Translation of overseas projects of non-integral foreign operations:
i Assets and liabilities at the rates prevailing at the end of the year.
ii Income and expenses at the average exchange rate prevailing for the month of transactions.
iii Resulting exchange differences are accumulated in foreign currency translation reserve account.
xiv Borrowing Costs
Borrowing Costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that takes necessarily substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.
xv Provisions, Contingent Liabilities and Contingent Assets
Provisions involving substantial degree of estimation in measurement are recognized, when there is a present obligation as a result of past events and that probably requires an outflow of resources.
A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no disclosure is made.
xvi Accounting for Project Mobilisation expenses
Expenditure incurred on creation of site infrastructures is written off in proportion to work done at respective sites so as to absorb such expenditure during the tenure of the contract.
xvii Balance of Receivables
Trade receivables of the clients in these accounts are disclosed net of advances outstanding at the year end from the respective clients.
xviii Other Accounting Policies
Accounting Policies not specifically referred to, are consistent with the generally accepted accounting practices.
xix Particulars of subsidiaries included in consolidation.
Name of the Subsidiary Country of Incorporation
% of Voting Power of JMC as at March 31, 2015
Subsidiary w.e.f.
JMC Mining and Quarries Ltd India 100.00% 02/01/1996
Brij Bhoomi Expressway Pvt. Ltd. India 100.00% 06/12/2010
Wainganga Expressway Pvt. Ltd. India 100.00% 02/06/2011
Vindhyachal Expressway Pvt. Ltd. India 100.00% 16/01/2012
xx Particulars of Jointly Controlled Entity (JCE) included in consolidation.
Name of Jointly Controlled Entity Name of the Venturer’s Partner
% of Voting Power of JMC as at March 31, 2015
Date of Incorporation
Kurukshetra Expressway Pvt. Ltd. SREI Infrastructure
Finance Ltd.
49.57% 29/03/2010
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(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014
NOTE - 1
SHARE CAPITAL
Authorised: 3,50,00,000 (3,50,00,000) Equity Shares of ` 10/- each 3500.00 3500.00
15,00,000 (15,00,000) Preference Shares of ` 100/- each 1500.00 1500.00
5000.00 5000.00
Issued, Subscribed and Paid up:2,61,18,348 (2,61,18,348) Equity Shares of ` 10/- each fully paid up 2611.83 2611.83
TOTAL 2611.83 2611.83
a. Reconciliation of the Shares outstanding at the beginning and at the end of the year :
Equity Shares As at March 31, 2015 As at March 31, 2014
Nos. (` in Lacs) Nos. (` in Lacs)At the beginning of the year 26118348 2611.83 26118348 2611.83
Issued during the year - - - -
Bought back during the year - - - -
Outstanding at the end of the year 26118348 2611.83 26118348 2611.83
b. Terms / Rights attached to Equity Shares
The Company has only one class of Equity Shares having par value of ` 10/- per share. Each holder of Equity Shares is entitled to one vote per share. The dividend is declared and paid on being proposed by the Board of Directors after the approval of the Shareholders in the ensuing Annual General Meeting.
In the event of liquidation of the Company, the holders of Equity Shares will be entitled to receive remaining assets of the Company, after distribution of all liabilities. The distribution will be in proportion to the number of Equity Shares held by the shareholders.
c. Shares held by Holding Company and its Subsidiaries / Associates.
Out of Equity Shares issued by the Company, the shares held by Holding and its Subsidiaries / Associates are as below :
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014Kalpataru Power Transmission Ltd.
1,75,48,908 (1,75,48,908) Equity Shares of ` 10/- each fully paid 1754.89 1754.89
d. Details of shareholders holding more than 5% shares in the Company
Equity Shares As at March 31, 2015 As at March 31, 2014
Nos. % Holding Nos. % Holding
Equity Shares of ` 10/- each fully paid
Kalpataru Power Transmission Ltd., the Holding Company
17,548,908 67.19% 17,548,908 67.19%
e. Shares reserved for issue under options
The Company has reserved issuance of 10,00,000 (10,00,000) Equity Shares of ` 10/- each for offering to the eligible employees of the Company under Employee Stock Option Plan (ESOP). On 21st July, 2007, the Company granted 6,00,000 Options to the eligible employees at a price of ` 217/- each, and these Options have been vested over the period of 4 years from the date of grant based on specified criteria. As at March 31, 2015 the total number of options vested but not excercised by employees stood at 58,235 (P.Y. 1,39,655).
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
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(` in Lacs)
Particulars As at As at
March 31, 2015 March 31, 2014
Note - 2
RESERVES & SURPLUS
Securities Premium
As per last Balance Sheet 21222.86 21222.75
Add: Premium during the year - 0.11
21222.86 21222.86
Debenture Redemption Reserve
As per last Balance Sheet 750.00 893.75
Add: Transfer from Surplus of Profit 106.25 231.25
Less: Transfer to General Reserve 500.00 375.00
356.25 750.00
Employee Share Options Outstanding
Employee share options granted - at the beginning of the year 76.82 135.17
Less: Deferred Employee Share Compensation 44.78 58.35
32.04 76.82
Foreign Currency Translation Reserve
As per last Balance Sheet (104.22) (0.26)
Add: During the year 119.98 (103.96)
15.76 (104.22)
Grant-in-aid
As per last Balance Sheet 4950.00 -
Add: During the year - 4950.00
4950.00 4950.00
General Reserve
As per last Balance Sheet 3795.19 3195.19
Add: Transfer from Surplus of Profit 225.00 225.00
Add: Transfer from Debenture Redemption Reserve 500.00 375.00
Less: Transfer to Accumulated Depreciation 671.89 -
3848.30 3795.19
Surplus of Profit
Balance as per Last Balance Sheet 11763.40 13586.72
Add: Profit for the year as per Statement of Profit & Loss (2430.14) (1061.50)
Less: Appropriations :
Proposed Dividend 261.18 261.18
Corporate Tax on Proposed Dividend 53.17 44.39
Transfer to Debenture Redemption Reserve 106.25 231.25
Transfer to General Reserve 225.00 225.00
Net Surplus of Profit 8687.66 11763.40
TOTAL 39112.87 42454.05
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
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(` in Lacs)
As at March 31, 2015 As at March 31, 2014
Non-Current Current Non-Current Current
Note - 3
LONG TERM BORROWINGS
A. Secured Loans (a) Debentures
150 (350) 9.5% Secured Redeemeble Non - Convertible Debentures of ` 10,00,000/- each.
- 1500.00 1500.00 2000.00
(b) Term Loans:
(1) Foreign Currency Loans
From Banks 1151.54 1535.38 2686.92 1535.38 (2) Rupee Loans
(I) From Banks 119293.37 4340.58 102269.32 4079.45 (II) From NBFCs 27769.85 1803.83 11199.15 230.16 (III) Loan against Vehicles / Equipments 89.56 39.46 90.41 45.69
TOTAL (b) 148304.32 7719.25 116245.80 5890.68 B. Unsecured Loans
(1) Fixed Deposits from Public 19.83 996.48 1133.43 235.27 (2) Rupee Term Loans from Banks 12175.00 825.00 10000.00 - (3) Subordinated Debt 2095.40 - 272.64 -
Amount disclosed under the head "Other Current Liabilities" (Note - 9)
(11040.73) (8125.95)
TOTAL [(A) + (B)] 162594.55 - 129151.87 -
Notes:
Nature of Security Terms of Repayment
A. (a) 9.5% Secured Redeemable Non-Convertible Debentures (NCDs) :-
First charge on movable fixed assets of the Company to the extent of 1.25 times of the amount of NCDs in paripassu with a Bank in (b) (2) (I) (ii), and first charge by mortgage of a land at Maharajpura, Kadi, Gujarat.
NCDs are repayable in tranches at the end of 5th Year ` 1,500 lacs from date of allotment i.e. July 15, 2010.
(b) (1) Foreign Currency Term Loans from Banks (FCL):-
External Commercial Borrowing of US $ 53.85 Lacs (P.Y. US $ 84.62 Lacs) is secured by first charge on specific movable fixed assets financed by them.
FCL is repayable in balance 7 equal quarterly instalments of US $ 769,230.77 each and carry interest @ 6 months LIBOR plus spread.
(b) (2) (I) Rupee Term Loans from Banks :-
(b) (2) (I) (i)
Term Loan from a consortium bank amounting to ` 1,717.56 lacs (P.Y. ` 2,499.08 lacs) is secured by first and exclusive charge over the fixed assets financed by them.
Term Loan is repayable in balance 11 equal quarterly instalments of ` 156.25 lacs each with varying interest rate linked to base rate of Bank from time to time.
(b) (2) (I) (i-a)
Term Loan from a Bank amounting to ` Nil (P.Y. ` 833.33 lacs) is secured by first charge on movable fixed assets excluding assets charged exclusively to term lender in b (1), b (2) (I) (i) and b (2) (II) in paripassu with debenture holders to the extent of 1.25 times of the amount of NCDs and a Bank in (b) (2) (I) (iii).
No outstanding balance as on the date of Financial Statement.
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
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Corporate Overview Statutory Reports Financial Reports
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
(b) (2) (I) (ii)Term Loan from a Bank amounting to ` 4,468.75 lacs (P.Y. ` 6,093.75 lacs) is secured by first charge on movable fixed assets excluding assets charged exclusively to term lender in b (1), b (2) (I) (i) and b (2) (II) in paripassu with debenture-holders to the extent of 1.25 times of the amount of NCDs and a bank in (b) (2) (I) (ii).
Term Loan is repayable in balance 11 equal quarterly instalments with varying interest rate linked to base rate of Bank from time to time.
(b) (2) (I) (iii)Term Loan from a Bank amounting to ` 4,000.00 lacs (P.Y. ` Nil) is secured exclusively by first charge on movable fixed assets funded out of the said facility.
Term Loan is repayable in unequal quarterly instalments every year starting from the end of 5th quarter from the date of disbursement, with varying interest rate linked to base rate of Bank from time to time.
(b) (2) (I) (iv)Term Loan from a bank amounting to ` 25,350.00 lacs (P.Y. ` 22,897.00 lacs) is secured by following assets of the subsidiary company, viz. Wainganga Expressway Pvt. Ltd. :(a) a first charge in favour of lenders / security trustee of all
immovable assets, if any, both present and future save and except project assets and
(b) a first charge in favour of lenders / security trustee for the benefit of the lenders of all the borrowers' movable properties both present and future, save and except project assets.
Terms of repayment : Door-to-door tenure of 14.5 years - (including construction period of 910 days (30 months) from Appointed Date & moratarium period of 12 months from COD). Repayment in 45 unequal quarterly instalments commencing from September 2015.
(b) (2) (I) (v)Term Loans from Banks amounting to ` 15,496.79 lacs (P.Y. ` 15,902.47 lacs) is secured by following assets of the subsidiary company, viz. Brij Bhoomi Expressway Pvt. Ltd. :a) a first mortgage and charge on all the Borrower’s
immovable properties, if any, both present and future; save and except the Project Assets.
b) a first charge by way of hypothecation of all the Borrower’s movable assets; save and except the Project Assets.
c) a first charge on Borrower’s Receivables save and except the Project Assets
d) a first charge over all the Accounts of the Borrowere) a first charge on all intangibles of the Borrower f) a first charge by way of assignment or otherwise
creation of Security Interest in all the right, title, interest, benefits, claims and demands whatsoever of the Borrower in accordance with the provisions of the Substitution Agreement and the Concession Agreement
g) a first charge by way of assignment or creation of security interest of (a) all the rights, title, interest, benefits, claims and demands whatsoever of the Borrower in the Project Documents
Payable in 44 (Forty Four) unequal quarterly instalments repayment shall commence after a moratorium period of not exceeding 24 (Twenty Four) months from Appointed Date or March 31 2013, whichever is earlier and terminating on 31st December 2024.
(b) (2) (I) (vi)Term Loans from Banks amounting to ` 34,000.00 lacs (P.Y. ` 20,000.00 lacs) is secured by following assets of the subsidiary company, viz. Vindhyachal Expressway Pvt. Ltd.:(a) first mortgage and charge on all the immovable
properties of the Borrower, if any, both present and future; save and except the Project Assets. By way of hypothecation of all the Borrower’s movable assets; save and except the Project Assets, Borrower’s Receivables save and except the Project Assets and on all intangibles of the Borrower
Terms of repayment : Payable in 144 (One Hundred Forty Four) unequal monthly instalments. The repayment shall commence after a moratorium period of 12 (Twelve) months from COD or August 31, 2015 and ending in July 2027.
127
JMC Projects (India) Ltd.84
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
(b) first charge by way of assignment or otherwise creation of Security Interest in all the right, title, interest, benefits, claims and demands whatsoever of the Borrower in accordance with the provisions of the Substitution Agreement and the Concession Agreement & by way of assignment or creation of security interest of (a) all the rights, title, interest, benefits, claims and demands whatsoever of the Borrower in the Project Documents.
(b) (2) (I) (vii)
Term Loans from Banks amounting to ` 77,868.68 lacs (P.Y. ` 76,905.00 lacs) [As per JMC Holding : ` 38,600.85 lacs (P.Y. ` 38,123.14 lacs)] is secured by following assets of the jointly controlled entity, viz. Kurukshetra Expressway Pvt. Ltd. :
Payable in 47 (Forty Seven) unequal quarterly instalments, repayment shall commence from June 30, 2014 after a construction and moratorium period of 42 (Forty Two) months.
a) a first mortgage and charge on all the Borrower’s immovable properties, if any, both present and future; save and except the Project Assets.
b) a first charge by way of hypothecation of all the Borrower’s movable assets; save and except the Project Assets.
c) a first charge on Borrower’s Receivables save and except the Project Assets
d) a first charge over all the Accounts of the Borrowere) a first charge on all intangibles of the Borrower save
and except the Project Assets f) a first charge by way of assignment or otherwise
creation of Security Interest in all the right, title, interest, benefits, claims and demands whatsoever of the Borrower in accordance with the provisions of the Substitution Agreement and the Concession Agreement
g) a first charge by way of assignment or creation of security interest of (a) all the rights, title, interest, benefits, claims and demands whatsoever of the Borrower in the Project Documents.
h) a first charge on uncalled equity share capital.
As at the reporting date, there has been continuing default in payment of Interest aggregating to ` 25.01 Crs [JMC Holding : ` 12.39 Cr.] (For the Period from Jan 15 to March 15) and installment of ` 2.98 Crs [JMC Holding : ` 1.48 Cr.] in respect of term loan taken from banks. The installment and interest have been subsequently paid.
(b) (2) (II) Rupee Term Loan from NBFC & Others :-
(b) (2) (II) (i)
Term Loan from NBFC amounting to ` 1,523.68 lacs (P.Y. ` 840.31 lacs) is secured by first and exclusive charge by way of hypothecation for equipments financed by them.
Term Loan is repayable in 48 months through quarterly instalments commencing from the end of 180 days from the date of first disbursement, i.e. October 18, 2013 with interest payable monthly at varying interest rate linked to base rate of NBFC from time to time.
Term Loan from NBFC amounting to ` 10,000.00 lacs (P.Y. ` Nil) is secured by subservient charge over the entire movable tangible assets of the company and further guaranteed by the Holding Company.
Term Loan is repayable in 8 equal quarterly instalments commencing from March 15, 2016 with interest payable monthly at varying interest rate linked to base rate of Bank from time to time and further there is a Put Option at the end of 12 months from the date of first disbursement and every year thereafter.
128
JMC Projects (India) Limited
85Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
(b) (2) (II) (ii)
Term Loan from NBFC amounting to ` 7,450.00 lacs (P.Y. ` 7,089.00 lacs) is secured by following assets of the subsidiary company, viz. Wainganga Expressway Pvt. Ltd. :(a) a first charge in favour of lenders / security trustee of all
immovable assets, if any, both present and future save and except project assets and
(b) a first charge in favour of lenders / security trustee for the benefit of the lenders of all the borrowers' movable properties both present and future, save and except project assets.
Terms of repayment : Door-to-door tenure of 14.5 years - (including construction period of 910 days (30 months) from Appointed Date & moratarium period of 12 months from COD). Repayment in 45 unequal quarterly instalments commencing from June 2015.
(b) (2) (II) (iii)
Term Loan from NBFC amounting to ` 10,600.00 lacs (P.Y. ` 3,500.00 lacs) is secured by following assets of the subsidiary company, viz. Vindhyachal Expressway Pvt. Ltd. :(a) first mortgage and charge on all the immovable
properties of the Borrower, if any, both present and future; save and except the Project Assets. By way of hypothecation of all the Borrower’s movable assets; save and except the Project Assets, Borrower’s Receivables save and except the Project Assets and on all intangibles of the Borrower
(b) first charge by way of assignment or otherwise creation of Security Interest in all the right, title, interest, benefits, claims and demands whatsoever of the Borrower in accordance with the provisions of the Substitution Agreement and the Concession Agreement & by way of assignment or creation of security interest of (a) all the rights, title, interest, benefits, claims and demands whatsoever of the Borrower in the Project Documents.
Terms of repayment : Payable in 144 (One Hundred Forty Four) unequal monthly instalments. The repayment shall commence after a moratorium period of 12 (Twelve) months from COD or August 31, 2015 and ending in July 2027.
(b) (2) (III) Loan against Vehicles / Equipments :
Loans of ` 129.02 lacs (P.Y. ` 136.10 lacs) are secured by way of charge on specific equipments and vehicles financed by them on different loans.
60 monthly instalments beginning from the month subsequent to disbursement.
B. Unsecured Loans :
Unsecured Loans :
(1) Fixed Deposits from public of ` 1,016.31 lacs (P.Y. ` 1,368.70 lacs)
Fixed deposits maturing at 12, 24 and 36 months from the date of deposit with varying interest rate with reference to tenure of deposits.
(2) Term Loan from a Bank amounting to ` 13,000.00 lacs (P.Y. ` 10,000.00 lacs).
Term Loan is repayable in unequal quarterly instalments every year, i.e. 10% for 2nd & 3rd year and 20% from 4th to 7th year, starting from the end of 5th quarter from March 11, 2014, with varying interest rate linked to base rate of Bank from time to time.Borrower has a right to prepay the facility anytime and lender has a right to recall the facility, after 5 years from the first drawdown date after 15 days notice.
(3) Subordinated Debt from a Joint Venturer SREI Infra Structure Finance Ltd. amounting to ` 4,227.00 Lacs (P.Y. ` 550.00 Lacs) [As per JMC Holding : ` 2,095.40 Lacs (P.Y. ` 272.64 Lacs)]
Unsecured Long Term and interest free Loan.
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
129
JMC Projects (India) Ltd.86
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014
Note - 4
DEFERRED TAX LIABILITY / (ASSET)
Deferred Tax Liability
Others 195.10 7.70
Deferred Tax Asset
Depreciation (661.50) (237.49)
U/s. 43B and 40(a)(ia) of Income Tax Act (1067.48) (1428.28)
TOTAL (1533.88) (1658.07)
Note - 5
OTHER LONG TERM LIABILITIES
Trade Payables 12710.55 9289.44
Others
Advance from Clients 19714.23 13264.10
Payable to Joint Venture Entities 158.75 158.48
TOTAL 32583.53 22712.02
Note - 6
LONG TERM PROVISIONS
Provision for employee benefits
Leave Encashment 293.37 274.05
Gratuity 530.02 371.86
Other Provisions
Defect Libility Period Expenses 3638.47 2756.40
TOTAL 4461.86 3402.31
Note - 7
SHORT TERM BORROWINGS
Secured
Working Capital Loans Repayable on Demand from Banks @ # 21765.71 13372.91
Unsecured
Commercial Paper 5000.00 -
Fixed Deposits from Public 73.94 74.41
TOTAL 26839.65 13447.32 @ Working Capital Loans include an overdraft of ` Nil (P.Y. ` 122.69 Lacs) from a non consortium bank which is secured against fixed deposit
placed with the same bank.# Working Capital Loans are secured in favour of consortium bankers, by way of :
(a) First charge against hypothecation of stocks, work in progress, stores and spares, bills receivables, book debts and other current assets.
(b) Second charge on movable Fixed assets except in (c) hereunder.
(c) First charge on the office premises of the Company.
130
JMC Projects (India) Limited
87Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014
Note - 8
TRADE PAYABLES
Acceptances 10223.14 10378.99
Others 50459.07 46773.18
TOTAL 60682.21 57152.17
Note - 9
OTHER CURRENT LIABILITIES
Current Maturities of Long Term Debt
9.5% Secured Redeemeble Non - Convertible Debentures of ̀ 10,00,000/- each. [Refer Note 3 - A(a)]
1500.00 2000.00
Term Loans from Banks & NBFCs - [Refer Note 3 - A(b)(1), A(b)(2)(I) & A(b)(2)(II)] 8504.79 5844.99
Loan against Vehicles / Equipments [Refer Note 3 - A(b)(2)(III)] 39.46 45.69
Fixed Deposits from Public [Refer Note 3 - B(1)] 996.48 235.27
Interest Accrued but not due on Borrowings 472.04 2086.00
Interest Accrued and due on Borrowings 1239.74 -
Unclaimed Dividend 9.09 9.04
Unclaimed Matured Fixed Deposits and Interest 24.70 14.42
Others
Payables for Capital Goods 1845.88 1282.04
Advance from Clients 7869.62 2523.25
Other Statutory Liabilities * 2323.97 3386.49
Unclaimed Share Application Money 0.13 0.13
Security Deposits 43.30 53.00
TOTAL 24869.20 17480.32
* Includes VAT Payable ` 205.70 lacs (P.Y. ` 211.15 lacs) [Net of Advance]
Note - 10
SHORT TERM PROVISIONS
Provision for Employee Benefits
Leave Encashments 43.82 38.42
Gratuity 1.05 0.98
Other Provisions
Defect Liability Period Expenses 127.09 1074.62
Proposed Dividend 261.18 261.18
Corporate Tax on Proposed Dividend 53.17 44.39
TOTAL 486.31 1419.59
131
JMC Projects (India) Ltd.88
No
te -
11
FIX
ED A
SSET
S(`
in L
acs)
Des
crip
tio
n
Gro
ss B
lock
Dep
reci
atio
nN
et B
lock
As
at
Ap
ril 0
1,
2014
Ad
dit
ion
s
Dis
po
sals
As
at
Mar
ch 3
1,
2015
As
at
Ap
ril 0
1,
2014
Tran
sfer
to
R
eser
ves
&
Surp
lus
For
the
Yea
r R
eco
up
edA
s at
M
arch
31,
20
15
As
at
Mar
ch 3
1,
2015
As
at
Mar
ch 3
1,
2014
A. T
AN
GIB
LE A
SSET
SFr
eeho
ld L
and
142.
71
- -
142.
71
- -
- -
- 14
2.71
14
2.71
Off
ice
Build
ing
247.
66
434
.39
- 68
2.05
33
.68
- 4.
57
- 38
.25
643.
80
213.
98
Stor
e Bu
ildin
g55
6.30
92
.29
0.10
64
8.49
29
.77
148.
61
85.7
5 -
264.
13
384.
36
526.
53
Plan
t &
Mac
hine
ry50
388.
40
8050
.54
1219
.98
5721
8.96
25
143.
46
768.
86
4153
.72
1069
.21
2899
6.83
28
222.
13
2524
4.94
Elec
tric
al In
stal
latio
n17
6.68
14
.18
12.0
8 17
8.78
13
6.61
3.
70
6.86
10
.52
136.
65
42.1
3 40
.07
Off
ice
Equi
pmen
ts12
72.7
6 17
6.74
62
.35
1387
.15
760.
05
70.2
5 21
4.03
58
.86
985.
47
401.
68
512.
71
Furn
iture
& F
ixtu
res
290.
40
13.3
9 7.
60
296.
19
149.
44
11.3
9 38
.12
5.33
19
3.62
10
2.57
14
0.96
Veh
icle
s16
76.7
6 16
76.1
7 14
8.17
32
04.7
6 10
07.0
0 -
340.
44
95.8
0 12
51.6
4 19
53.1
2 66
9.76
TOTA
L (A
)54
751.
67
1045
7.70
14
50.2
8 63
759.
09
2726
0.01
10
02.8
1 48
43.4
9 12
39.7
2 31
866.
59
3189
2.50
27
491.
66
B. I
NTA
NG
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ASS
ETS
Toll
Col
lect
ion
Righ
ts40
506.
93
1316
63.0
6 -
1721
69.9
9 20
7.30
-
1601
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- 18
08.4
4 17
0361
.55
4029
9.63
Com
pute
r So
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are
161.
25
30.7
8 -
192.
03
79.4
7 7.
65
55.6
5 -
142.
77
49.2
6 81
.78
TOTA
L (B
)40
668.
18
1316
93.8
4 -
1723
62.0
2 28
6.77
7.
65
1656
.79
- 19
51.2
1 17
0410
.81
4038
1.41
TO
TAL
(A+B
)95
419.
85
1421
51.5
4 14
50.2
8 23
6121
.11
2754
6.78
10
10.4
6 65
00.2
8 12
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2 33
817.
80
2023
03.3
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873.
07
Prev
ious
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213.
95
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0.22
27
34.3
2 95
419.
85
2353
6.76
-
6100
.62
2090
.60
2754
6.78
67
873.
07
C. C
apit
al W
ork
-in-P
rog
ress
928.
90
592.
44
1513
.27
8.07
8.
07
928.
90
D. I
nta
ng
ible
Ass
ets
Un
der
D
evel
op
men
t10
3748
.59
3111
6.59
13
1663
.06
3202
.12
3202
.12
1037
48.5
9
Not
es:
(1)
The
carr
ying
am
ount
of
the
gros
s bl
ock
and
accu
mul
ated
dep
reci
atio
n th
ereo
n pe
rtai
ning
to
the
Com
pany
’s n
on-in
tegr
al f
orei
gn o
pera
tions
hav
e be
en r
esta
ted
at c
losi
ng e
xcha
nge
rate
s of
the
for
eign
cur
renc
y an
d th
e re
sulta
nt e
ffec
t of
` -1
2.36
lacs
(P.
Y. `
Nil)
and
of `
-0.4
3 la
cs (
P.Y
. ` N
il) h
ave
been
incr
ease
d /
(red
uced
) in
add
ition
s an
d de
prec
iatio
n fo
r th
e ye
ar
resp
ectiv
ely.
(2)
Purs
uant
to
the
tran
sitio
n pr
ovis
ion
pres
crib
ed in
Sch
edul
e II
to t
he C
ompa
nies
Act
, 201
3, t
he C
ompa
ny h
as a
djus
ted
an a
mou
nt o
f `
1010
.46
lacs
per
tain
ing
to a
sset
s w
hose
use
ful l
ife
has
exha
uste
d an
d af
ter
adju
stm
ent
of `
338
.57
lacs
for
def
erre
d ta
x ba
lanc
e, i.
e. `
671
.89
lacs
is a
djus
ted
agai
nst
the
open
ing
Surp
lus
bala
nce
in G
ener
al R
eser
ve.
(3)
Inta
ngib
le a
sset
s un
der
deve
lopm
ent
com
pris
es o
f To
ll C
olle
ctio
n Ri
ghts
as
follo
ws:
(` In
Lac
s.)
a)
Con
stru
ctio
n co
st14
9368
.96
b)
Pre-
oper
ativ
e ex
pens
esBa
lanc
e br
ough
t fo
rwar
d fr
om p
revi
ous
year
1829
3.15
Add
: Exp
endi
ture
incu
rred
dur
ing
the
year
1)
Pro
fess
iona
l Fee
s11
09.6
6
2) A
udit
Fees
2.58
3)
Oth
er E
xpen
ses
/ Re
-imbu
rsem
ents
-727
.90
4)
Ban
k C
harg
es (
Incl
Ban
k G
uara
ntee
and
pro
cess
ing
char
ges)
75.9
4
5) In
tere
st D
urin
g C
onst
ruct
ion
7249
.71
Less
: Tra
nsfe
r of
Pre
-ope
rativ
e ex
p. t
o To
ll co
llect
ion
Righ
ts-1
7217
0.00
TOTA
L32
02.1
2
NO
TES
ON
CO
NSO
LID
ATE
D F
INA
NCI
AL
STA
TEM
ENTS
for
the
year
end
ed M
arch
31,
201
5
132
JMC Projects (India) Limited
89Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014
NOTE - 12
NON CURRENT INVESTMENTS
Trade Investments
Investment in Joint Venture
(a) Agrawal JMC - JV 694.60 694.81
(b) JMC - CHEC JV 360.22 232.10
TOTAL 1054.82 926.91
NOTE - 13
LONG TERM LOANS & ADVANCES
Unsecured considered good
Advance for Capital Goods 370.01 1433.40
Loans and Advance to Related Parties
Loan to Joint Venture 2,229.69 288.45
Security Deposits 935.07 1166.20
Others
Advance to Creditors 262.59 409.92
Advance VAT (Net of Payable) 3295.86 4709.60
TOTAL 7093.22 8007.57
NOTE - 14
OTHER NON CURRENT ASSETS
Unsecured considered good
Long Term Trade Receivables 4073.92 2712.95
Others
Unamortized Expenses
Site Infrastructures 1173.77 1202.23
Ancillary cost of borrowing 172.17 167.88
TOTAL 5419.86 4083.06
NOTE - 15
INVENTORIES
Construction Material 10371.32 12298.16
Spares,Tools & Stores 3862.96 3430.58
Work-in- Progress 10932.20 8522.02
TOTAL 25166.48 24250.76
(a) As Valued, Verified and Certified by the Management.
(b) Basis of valuation is lower of cost or net realisable value.
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
133
JMC Projects (India) Ltd.90
(` in Lacs)
Particulars As at
March 31, 2015 March 31, 2014
NOTE - 16TRADE RECEIVABLESUnsecured and considered good
Debts outstanding over Six Months from due date of payment 7321.11 8139.12 Other Debts includes Retention Money net off advances 33349.89 17631.71
TOTAL 40671.00 25770.83
NOTE - 17CASH AND BANK BALANCESCash and Cash EquivalentsBalance with Banks
Current Accounts 1763.85 2388.38 Demand Deposits (with less than 3 months of remaining maturity) 229.92 87.74
Cash on hand 95.36 83.74 Other Bank Balance
Deposits as Margin Money against Borrowings and Commitments 128.69 314.70 Dividend Accounts (Unclaimed) 9.09 9.04
TOTAL 2226.91 2883.60
NOTE - 18
SHORT TERM LOANS AND ADVANCES
Unsecured and considered good
Loans and Advance to Related Parties * - 21.19 Others
Security Deposits 1295.67 583.56 Advance Income Tax (Net of Provision) 6584.98 4646.60 Advance VAT / Entry Tax (Net of Payable) 6157.24 3247.22 Cenvat Credit Receivable 2269.69 2208.06 Excise Duty Drawback 185.79 185.79 Advance to Creditors 8162.90 8193.66 Loans and Advances to Employees 110.47 93.73 Prepaid Expenses 1190.10 1017.53
TOTAL 25956.84 20197.34 *Loans and Advance to Related Parties Include -
Kalpataru Power Transmission Ltd. ` Nil (P.Y. ` 21.19 lacs)
NOTE - 19
OTHER CURRENT ASSETS
Accrued Income 90.56 93.00 Unamortised Expenses
Site Infrastructures 3320.31 3711.94 Ancillary cost of borrowing 90.40 94.95 Accrued value of work done 36098.42 25590.44 Receivables for Sale of Fixed Assets 5.81 12.45
TOTAL 39605.50 29502.78
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
134
JMC Projects (India) Limited
91Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
(` in Lacs)
For the year ended
March 31, 2015 March 31, 2014NOTE - 20
REVENUE FROM OPERATIONS
Sale of Services
Contract Revenue 240490.32 254152.98
Income from Toll Collection 6389.85 1677.12
Accrued Value of Work Done (uncertified bills) (30.40) 10310.54
Other Operating Revenue
Share of Profit in Joint Ventures 128.12 230.79
TOTAL 246977.89 266371.43
NOTE - 21
OTHER INCOME
Interest IncomeFrom Deposits 39.13 55.60
From Others 541.63 43.45
Dividend IncomeFrom Current Investments - 0.10
From Long Term Investments 0.06 0.14
Net Gain on Sale of Fixed Assets 144.74 220.40
Rent Income 263.45 77.68
Liabilities Written Back 341.19 460.55
TOTAL 1330.20 857.92
NOTE - 22
CONSTRUCTION MATERIALS CONSUMED
Opening Stock of Construction Materials 12298.16 11551.36
Add: Purchases during the year 85286.78 90046.49
Less: Scrap Sales 1287.14 1059.86
Less: Closing Stock of Construction Materials 10371.32 12298.16
TOTAL 85926.48 88239.83
NOTE - 23
(INCREASE) / DECREASE IN INVENTORIES OF WORK-IN-PROGRESS
Work in Progress (at close) (10932.20) (8522.02)
Less : Work in Progress (at commencement) 8522.02 6779.90
TOTAL (2410.18) (1742.12)
NOTE - 24
EMPLOYEE BENEFIT EXPENSE
Salaries, Wages and Bonus 17788.85 14913.83
Contribution to Provident & Other Funds 1034.03 882.77
Employee Share Option Scheme Expenses (44.78) (58.35)
Staff Welfare Expenses 1350.23 1176.90
TOTAL 20128.33 16915.15
135
JMC Projects (India) Ltd.92
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
(` in Lacs)
For the year ended
March 31, 2015 March 31, 2014
NOTE - 25
FINANCE COSTInterest for Fixed Period Loans 14990.30 6638.19
Interest - Others 919.12 1189.87
Exchange Rate Variation 67.41 67.83
TOTAL 15976.83 7895.89
NOTE - 26
OTHER EXPENSESConstrurction Expenses
Work Charges 43698.59 41202.57
Composite Work Charges 44204.71 75143.96
Consumption of Spares, Tools & Stores 1340.60 941.23
Machinery - Running & Maintenance Expenses 7405.39 5210.67
Electricity Charges 1825.39 1707.54
Rent & Hire Charges 5157.34 5178.69
Security Expenses 1401.22 1234.72
Site Expenses 5778.87 6015.72
Defect Liability Period Expenses (26.40) (64.29)
110785.71 136570.81
Mining Activity Expenses 3.30 24.21
Building & General Repairs 72.74 65.82
Vehicle Maintenance Charges 376.91 358.74
Travelling Expenses 703.90 705.10
Conveyance Expenses 89.00 90.96
Directors’ Travelling Expenses 27.20 34.35
Insurance Charges 492.07 495.37
Printing & Stationery Expenses 245.34 181.96
Office Rent 598.94 572.26
Office Expenses 164.11 122.25
Postage & Telephone Charges 247.39 232.68
Professional & Legal Charges 822.45 663.38
Auditor’s Remuneration 38.76 35.88
Rates & Taxes 7281.08 8671.49
Business Promotion Expenses 116.16 108.82
Advertisement Expenses 30.93 40.49
Computer & IT Expenses 277.73 279.75
Sundry Expenses 495.04 317.75
Bank Commission & Charges 844.34 760.85
Training Expenses 22.12 40.63
Loss on Assets Lost 22.05 33.38
Loss on Investment in Joint Ventures 0.48 7.04
Exchange Rate Variation (562.82) (296.06)
Sitting Fees and Commission to Non-executive Directors 44.25 28.30
TOTAL 123239.18 150146.21
136
JMC Projects (India) Limited
93Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
(` in Lacs)
26.1 Auditors' Remuneration
Particulars 2014-15 2013-14
Audit Fees 33.51 27.95
Company Law Matters 2.25 2.25
Income Tax - 2.81
Other Services & Reports 3.00 2.88
TOTAL 38.76 35.88
27 Contingent Liabilities in respect of :
Particulars 2014-15 2013-14
A Bank Guarantees 6.50 17.00
B Guarantees given in respect of performance of contracts of Joint Venture Entities &
Associates in which company is one of the member / holder of substantial equity
17671.21 24491.12
C Guarantee given in favour of a subsidiary for Loan obtained by them 2250.00 -
D Claims against the Company not acknowledged as debts (Refer note below) 263.02 640.28
E Show Cause Notice Issued by Service Tax Authorities 5406.00 5211.28
F Trichy Madurai Road Project Royalty Matter 39.87 39.87
G Disputed Income Tax Demand in appeal before Appellate Authorities (Excludes Amount of
` 1794.13 (P.Y. ` 1794.13) considered in [J] hereinafter)
7610.29 7591.71
H Disputed Income Tax Demand of Joint Ventures in appeal before Appellate Authorities
(Excludes Amount of ` 214.70 (P.Y. ` 196.21) considered in [J] hereinafter)
8.77 240.08
I Disputed VAT Demand in appeal before Appellate Authorities 4428.61 952.72
J Income Tax (Net of Deferred Tax) on the claim made of the deductions u/s. 80-IA (4) of the
Income Tax Act, 1961. (Refer note 28)
2488.32 2657.23
K Claim not acknowledged as debt for JMC Mining & Quarries Ltd. - 14.84
Note: In case where Company has raised the claims on clients against which counter claims have been raised by clients, the excess of counter
claims raised by client over the amount of its claims only are considered in the above figures.
28 The Finance Act (2), 2009 has amended section 80-IA (4) of the Income Tax Act, 1961 by substituting an explanation to section
80-IA with retrospective effect from 01-04-2000. On the basis of the legal opinion of the experts and decided cases, the Company
has continued to claim deduction under section 80-IA (4) of the Act on eligible projects and consequently the Company considers it
appropriate not to create a liability for provision of Income Tax. However, an amount of Income tax (Net of Deferred Tax) of ` 2488.32
(P.Y. ` 2657.23) (include the amount of tax applicable on the share of profit of Joint Venture Business claiming such deduction) has
been disclosed as a contingent liability in note no. 27[J] to these Accounts.
29 Capital and other Commitments (` in Lacs)
Particulars 2014-15 2013-14
Estimated amount of contracts remaining to be executed on capital account and not
provided for (Net of advances)
14731.72 27025.71
30 In the opinion of the Management, the assets other than Fixed Assets and Non Current Investments have a realisable value, in the ordinary course of business, approaximately of the amount at which they are stated in these financial statements. Balances of parties are subject to confirmation.
137
JMC Projects (India) Ltd.94
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
31 Lease Transactions The Company’s significant leasing / licensing arrangements are mainly in respect of residential / office premises and equipments
(operating lease). Lease agreements in respect of residential / office premises and certain equipments are cancellable and renewable by mutual consent on mutually agreed terms. Certain equipments are on non-cancellable operating lease. The aggregate lease rental / hire charges payable on these premises / equipments are charged as rent & hire charges amounting to `2773.50 lacs (P.Y. ` 2684.02 lacs). Future estimated minimum lease rentals and their present values in respect of non-cancellable operating leases are as under:
(` in Lacs)
Particluars < 1 Year 1 to 5 Years Total
Future minimum lease payments 211.66 - 211.66
Present value of minimum lease payments 210.75 - 210.75
32 The disclosure in respect of Provision for Defect Liability Period Expenses is as under.
Particulars 2014-15 2013-14
Carrying amount at the beginning of the year 3831.01 3983.81
Add : Provision during the year 303.93 319.96
Less : Reversal of provision during the year 330.32 384.24
Less : Utilisation during the year 39.07 88.51
Carrying amount at the end of the year 3765.55 3831.01
33 Disclosure as per Accounting Standard - 7
(1) Contract revenue recognized as revenue during the year 239859.97 265195.46
(2) Contract costs incurred and recognized profit less recognized losses 535506.47 661149.46
(3) Advances Received 35438.25 38157.35
(4) Retention Amount 10760.34 10407.09
(5) Amount Due from Customers 42676.89 45728.76
Note : The information in point no. (2) to (5) are in respect of contracts in progress as on March 31, 2015.
34 Segmental Reporting
The Company recognizes construction as the only business segment. Hence there are no reportable segments under AS - 17.
138
JMC Projects (India) Limited
95Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
35 Related Party Disclosure as per Accounting Standard (AS) 18
Holding Company
Kalpataru Power Transmission Ltd. Holding Company
Fellow Subsidiary Companies
Energylink (India) Ltd. Subsidiary of Holding Company
Shree Shubham Logistics Ltd. Subsidiary of Holding Company
Amber Real Estate Ltd. Subsidiary of Holding Company
Adeshwar Infrabuild Ltd. Subsidiary of Holding Company
Kalpataru Power Transmission Nigeria Ltd. Subsidiary of Holding Company
Kalpataru Power Transmission (Mauritius) Ltd. Subsidiary of Holding Company
Kalpataru SA (Proprietary) Ltd. Subsidiary of Holding Company
Kalpataru Power Transmission – USA, INC. Subsidiary of Holding Company
Kalpataru Power Transmission International B.V. Subsidiary of Holding Company
LLC Kalpataru Power Transmission Ukraine Subsidiary of Holding Company
Kalpataru Power JLT, UAE Subsidiary of Holding Company
Saicharan Properties Ltd. Subsidiary of Holding Company
Gestamp Kalpataru Solar Steel Structures Pvt. Ltd. Subsidiary of Holding Company
Kalpataru Satpura Transco Pvt. Ltd. Subsidiary of Holding Company
Punarvasu Holding and Trading Co. Pvt. Ltd. Subsidiary of Holding Company
Joint Ventures Nature of Relationship
JMC - Associated JV Joint Venture
Aggrawal - JMC JV Joint Venture
JMC - Sadbhav JV Joint Venture
JMC - Taher Ali JV (Package I, II & III) Joint Venture
JMC - PPPL JV Joint Venture
KPTL-JMC-Yadav JV Joint Venture
JMC - GPT JV Joint Venture
JMC - CHEC JV Joint Venture
Key Managerial Personnel (KMP) Nature of Relationship
Mr. Shailendra Tripathi CEO & Dy. Managing Director
Mr. Manoj Kumar Singh Executive Director
Mr. Manoj Tulsian CFO & Director (Finance)
Mr. Suresh Savaliya Company Secretary
Enterprises over which significant influence exercised with whom company has transactions (EUSI)
Nature of Relationship
Kalpataru Ltd. Significant influence of Promoters
Kalpataru Properties Pvt. Ltd. Significant influence of Promoters
Kiyana Ventures LLP Significant influence of Promoters
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
139
JMC Projects (India) Ltd.96
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
(` in Lacs)
Sr. No.
Particulars of Transactions with Related Parties Holding Company
Joint Ventures
KMP EUSI
I. Transactions During the Year
1 Other Expenses - - - 15.31
(-) (-) (-) (5.73)
2 Rent Paid - - - 357.42
(3.60) (-) (-) (343.92)
3 Reimbursement of Expenses - - - -
(2.13) (1.33) (-) (-)
4 Sub-Contract Charges paid 4265.79 - - -
(4957.99) (-) (-) (-)
5 Contract Revenue 461.62 11306.36 - 1,326.34
(1236.69) (10712.35) (-) (-299.62)
6 Managerial Remuneration - - 482.88 -
(-) (-) (307.08) (-)
7 Share of Profit in Joint Venture - 128.12 - -
(-) (230.79) (-) (-)
8 Share of Loss in Joint Venture - 0.48 - -
(-) (-7.04) (-) (-)
II. Balance as on 31.03.2015
1 Trade Receivables # 82.62 1451.16 - 154.25
(32.27) (1609.89) (-) (-225.36)
2 Liabilities at the end of the year 1557.90 160.93 - 4.81
(1602.09) (160.66) (-) (97.79)
3 Loans & Advances given - 3.94 - -
(359.88) (-) (-) (-661.35)
4 Advance taken from Clients ^ - 2845.60 - -
(-) (2817.00) (-) (-)
5 Investment in Joint Venture entity - 1054.82 - -
(-) (926.91) (-) (-)
# Trade Receivables herein are Gross amount before Adjustment of Advances received from clients
^ Advances taken from clients herein are Gross amount before adjustment of Trade Receivables.
Note: Figures shown in bracket represents corresponding amounts of previous year.
140
JMC Projects (India) Limited
97Annual Report 2014-15
Corporate Overview Statutory Reports Financial Reports
36 Joint Ventures
I The Company is having consortium Joint Ventures named JMC-Associated JV, JMC-Taher Ali JV (Package I, II & III), JMC- PPPL JV, JMC ATEPL JV, JMC - GPT- Vijaywargi - Bright Power JV, JMC- Vijaywargi - Bright Power JV, KPTL - JMC - Yadav JV and JMC - GPT JV under work sharing arrangement. The revenue for work done is accounted, in accordance with the accounting policy followed by the Company, as that of independent contract to the extent work is executed.
II In respect of contracts executed in Joint Venture entities, the services rendered to the Joint Venture entities are accounted as revenue for the work done. The share of profit / loss in Joint Venture entities other than Joint Venture Company has been accounted for and the same is reflected as Investments or current liabilities in books of the Company.
The details of Joint Venture entities :
Name of the Joint Venture Name of Venture Partner Method of Accounting Share of Interest
a. Aggrawal - JMC JV Dinesh Chandra Aggrawal Infracon Pvt.Ltd. Percentage of Completion 50.00%
b. JMC - Sadbhav JV Sadbhav Engineering Ltd. Percentage of Completion 50.50%
c. JMC - CHEC JV China Harbour Enginering Company Ltd. Percentage of Completion 49.00%
Details of proportionate share in the Assets, Liabilities, Income and Expenditure of the Company in its Joint Venture entities.
(` in Lacs)
Particulars Aggrawal JMC JV JMC Sadbhav JV JMC CHEC JV
2014-15 2013-14 2014-15 2013-14 2014-15 2013-14
% of Holding 50.00% 50.00% 50.50% 50.50% 49.00% 49.00%
Assets 400.07 411.36 1,014.16 1,014.25 2,474.51 1,574.29
Liabilities 52.78 63.96 1,093.36 1,093.33 2,298.00 1,460.56
Income 1.69 - - - 5,849.19 5,616.48
Expenditure 1.79 0.74 0.14 - 5,776.50 5,503.39
The aforesaid Joint Venture Entities have not been consolidated using proportionate consolidation and only the share of profit / loss therein has been accounted for, as in view of the management, the above three Joint Venture entities are formed for specific projects and with a view to subsequent disposal on completion of specific projects in near future and accordingly they fell in the exception for proportionate consolidation as per para 28 of AS - 27.
37 Pursuant to Companies Act, 2013 (the Act), effective from April 1, 2014, the Company has revised depreciation rates on fixed assets based on useful life specified in Schedule II of the Act or assessed on technical evalation by the management as mentioned in significant accounting policies in these financials statements which is not longer than useful life specified in aforesaid Schedule II of the Act. As a result of the change, depreciation charge for the year ended March 31, 2015 is lower by ` 1425.43 lacs. In respect of assets whose useful life is already exhausted as on April 1, 2014 sum of ` 1010.46 lacs, i.e. ` 671.89 lacs (net of deferred tax) has been adjusted against the opening balance of General reserve in these financial staments in accordance with Schedule II of the Act.
38 The Company has entered into derivative contracts including forward contracts to hedge its risk associated with foreign currency fluctuations. Company does not use derivative contracts including forward contracts for speculative purpose.
(a) The particulars of derivatives including forward contracts entered into for hedging purposes and outstanding are as under :
(` in Lacs)
Category of Derivative instruments hedge As at March 31, 2015 As at March 31, 2014
Currency Swaps 2,832.76 4,605.10
Naturally Hedge 2,213.36 -
(b) Unhedged Foreign Currency exposure outstanding are as under :
The foreign currency exposure that is not hedged by derivative instruments amounts to ` 1,900.64 lacs (P.Y. ` 1,581.68 lacs).
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
141
JMC Projects (India) Ltd.98
NOTES ON CONSOLIDATED FINANCIAL STATEMENTS for the year ended March 31, 2015
39 The Management is of the opinion that as on the Balance Sheet date, there are no indications of a material impairment loss on Fixed Assets, hence the need to provide for impairment loss does not arise.
40 Figures pertaining to the group companies have been reclassified wherever necessary to bring them in line with the Company’s financial statements.
Signatures to Significant Accounting Policies and Notes to Consolidated Financial Statements 1 to 40.
As per our report attached For and on behalf of the Board of DirectorsFor Kishan M. Mehta & Co.Chartered Accountants Shailendra Kumar Tripathi Manoj TulsianFirm Registration No. 105229W CEO & Dy. Managing Director CFO & Director (Finance)
Kishan M. Mehta Manoj Kumar Singh Suresh SavaliyaPartner Executive Director Company SecretaryMembership No. 13707
Mumbai, May 29, 2015 Mumbai, May 28, 2015
142
143
ACCOUNTING RATIOS AND CAPITALISATION STATEMENT
Accounting Ratios
The following tables present certain accounting and other ratios on basis derived from our audited financial
statements as at and for the Fiscal 2014 and Fiscal 2015 included in the chapter “Financial Information” on
page 72 of the Letter of Offer.
Accounting Ratio (based on standalone Financial Statements and Financial Results):
Particulars Year Ended
March 31, 2015
Year Ended
March 31, 2014
Earnings Per Share
(a) Basic Earnings Per Share (after
extraordinary items)
11.43 8.79
(b) Diluted Earnings Per Share (after
extraordinary items)
11.43 8.79
Return on Net Worth 6.32% 5.13%
Net Asset Value/Book Value per Equity Share
each
181.00 171.49
Accounting Ratio (based on consolidated Financial Statements and Financial Results):
Particulars Year Ended
March 31, 2015
Year Ended
March 31, 2014
Earnings Per Share
(a) Basic Earnings Per Share (after
extraordinary items)
(9.30) (4.06)
(b) Diluted Earnings Per Share (after
extraordinary items)
(9.30) (4.06)
Return on Net Worth (5.87%) (2.40%)
Net Asset Value/Book Value per Equity Share
each
158.39 169.67
The Ratios have been computed as below:
Net worth: Aggregate of the paid up share capital and reserves and surplus as reduced by
revaluation reserve and debenture redemption reserve
Return On Net worth: Net Profits after tax
Net worth
Net Asset Value per Equity
Share (`):
Net Worth
Number of equity shares outstanding at the end of the period/year
Capitalisation Statement:
The following tables present the capitalisation statement as per the audited standalone financial statements of
our Company as at and for the financial period ended March 31, 2015:
Amount (` in Lacs)
Particulars Pre Issue
As at 31 March 2015 Post Issue
##
Borrowings
Long Term Debt 31,080.18 31,080.18
Short Term Debt 26,839.65 26,839.65
Current Maturities of Long-term Debt 8,962.06 8,962.06
144
Particulars Pre Issue
As at 31 March 2015 Post Issue
##
Total Debt (A) 66,881.89 66,881.89
Shareholder’s Fund
Equity Share Capital 2,611.83 3,358.10
Reserves & Surplus# 44,661.53 58,915.26
Total Shareholders’ Fund (B) 47,273.36 62,273.36
Total Debt/Equity Ratio ( A/B)* 1.41 1.07
Long term Debt//Equity Ratio 0.66 0.50 #Reserves & Surplus excludes Revaluation Reserves and Debenture Redemption Reserves
## Assuming full subscription and Allotment of the Rights Equity Shares in the Issue, without deducting issue
expenses
*Total Debt/Equity Ratio = Total Debt/Total Shareholder’s Fund Excluding Revaluation Reserve and Debenture
Redemption Reserve
The following tables present the capitalisation statement as per the audited consolidated financial statements of
our Company as at and for the financial period ended March 31, 2015.
Amount (` in Lacs)
Particulars Pre Issue
As at 31 March 2015 Post Issue
##
Borrowings
Long Term Debt 1,62,594.55 1,62,594.55
Short Term Debt 26,839.65 26,839.65
Current Maturities of Long-term Debt 11,040.73 11,040.73
Total Debt (A) 2,00,474.93 2,00,474.93
Shareholder’s Fund
Equity Share Capital 2,611.83 3,358.10
Reserves & Surplus# 38,756.62 53,010.35
Total Shareholders’ Fund (B) 41,368.45 56,368.45
Total Debt/Equity Ratio ( A/B)* 4.85 3.56
Long term Debt//Equity Ratio 3.93 2.88 #Reserves & Surplus excludes Revaluation Reserves and Debenture Redemption Reserves
## Assuming full subscription and Allotment of the Rights Equity Shares in the Issue, without deducting issue
expenses
*Total Debt/Equity Ratio = Total Debt/Total Shareholder’s Fund Excluding Revaluation Reserve and Debenture
Redemption Reserve
145
STOCK MARKET DATA FOR EQUITY SHARES
The Equity Shares of the Company are listed on the BSE and the NSE with effect from December 16, 1994 and
November 26, 2007 respectively. Stock market data for our Equity Shares has been given separately for the BSE
and the NSE. As our Equity Shares are actively traded on both BSE and NSE, stock market data has been given
separately for each of these Stock Exchanges.
The high and low prices recorded on BSE and NSE for the preceding three Financial Years and the
number of Equity Shares traded on the respective dates of high and low prices are as stated below:
BSE Year ending
March 31
High
(`)*
Date of high No. of shares
traded on date
of high
Total volume
traded on date of
high
(` in lacs)
Low
(`)*
Date of low No. of shares
traded on date
of low
Total volume of
traded on date of
low
(` in lacs)
Average price
for the year
(`)**
Mar-13 131.70 December
20, 2012
1,10,157 139.11 70.60 March 22,
2013
1,988 1.42 107.34
Mar-14 96.85 January 09,
2014
93,367 86.84 55.00 September
23, 2013
1,541 0.86 74.10
Mar-15 207.00 March 18,
2015
2,88,652 574.08 85.05 May 07,
2014
9,936 8.56 150.46
(Source: www.bseindia.com)
* High and low prices are based on the high and low of the daily prices.
** Average of the daily closing prices.
NSE Year ending
March 31
High
(`)*
Date of high No. of
shares
traded on
date of high
Total volume
traded on date
of high
(` in lacs)
Low (`)* Date of low No. of shares
traded on
date of low
Total volume
of traded on
date of low
(` in lacs)
Average price
for the year
(`)**
Mar-13 132.45 December
20, 2012
2,48,641 314.43 70.40 March 22,
2013
3,557 2.54 107.33
Mar-14 96.90 January 09,
2014
2,04,411 190.29 55.00 September
11, 2013
1,82,498 102.38 74.29
Mar-15 207.80 March 18,
2015
12,05,312 2,399.47 84.65 May 05,
2014
15,581 13.43 150.51
(Source: www.nseindia.com)
* High and low prices are based on the high and low of the daily prices.
** Average of the daily closing prices.
The high and low prices and volume of the Equity Shares traded on the respective dates during the last
six months is as follows:
BSE Month Date of high High
(`)*
Volume
(No. of
shares)
Total volume
traded on
date of high
(` in lacs)
Date of low Low
(`)*
Volume
(No. of
shares)
Total volume
traded on
date of low
(` in lacs)
Average
price for
the month
(`)**
Dec-15 December 2, 2015
265.00 2,129 5.52 December 10, 2015
228.70 1,760 4.22 244.74
Nov-15 November 27,
2015
263.00 9,083 23.41 November 09,
2015
215.60 1,192 2.66 235.33
Oct-15 October 19,
2015
246.70 12,686 30.45 October 12,
2015
210.40 7,659 16.39 227.79
Sep-15 September 16,
2015
237.70 81,685 185.81 September 07,
2015
175.10 6,115 11.18 206.28
Aug-15 August 05, 2015
286.00 17,595 48.96 August 25, 2015
177.00 8,856 17.33 244.63
Jul-15 July 28, 2015 294.80 10,614 28.10 July 06, 2015 215.00 3,308 7.31 249.89
(Source: www.bseindia.com)
* High and low prices are based on the high and low of the daily prices.
**Average of the daily closing prices.
146
NSE Month Date of high High
(`)*
Volume
(No. of
shares)
Total volume
traded on
date of high
(` in lacs)
Date of low Low
(`)*
Volume
(No. of
shares)
Total volume
traded on
date of low
(` in lacs)
Average
price for
the month
(`)**
Dec-15 December 2,
2015
265.00 10,354 26.87 December
11, 2015
228.70 7,604 17.92 244.19
Nov-15 November 27, 2015
263.25 24,447 63.24 November 09, 2015
216.95 5,242 11.84 236.04
Oct-15 October 19,
2015
246.95 47,408 113.91 October 12,
2015
211.05 31,074 66.81 228.06
Sep-15 September 16, 2015
237.90 3,36,347 767.70 September 07, 2015
175.10 34,292 63.15 206.48
Aug-15 August 05,
2015
285.00 42,959 119.23 August 25,
2015
177.05 18,176 35.78 244.80
Jul-15 July 24, 2015
294.60 2,02,959 567.54 July 06, 2015
217.15 16,840 37.29 250.07
(Source: www.nseindia.com)
* High and low prices are based on the high and low of the daily prices.
**Average of the daily closing prices.
In the event the high or low or closing price of the Equity Shares are the same on more than one day, the day on
which there has been higher volume of trading has been considered for the purposes of this chapter.
The closing price of the Equity Shares as on September 14, 2015, the trading day immediately following the day
on which Board approved the Issue, was ` 204.20 and ` 205.85 on the BSE and the NSE respectively.
Week end closing prices of the Equity Shares for the last four weeks on BSE and NSE are as below:
BSE
Week Ended on Closing Price
(`)
Highest Price
(`)*
Date of High Low price (`)* Date of Low
January 8, 2016 249.00 268.50 January 6,
2016
244.80 January 8, 2016
January 1, 2016 255.10 257.00 December 30,
2015
245.80 December 29,
2015
December 24,
2015
243.00 247.00 December 21,
2015
237.80 December 21,
2015
December 18,
2015
240.40 261.60 December 17,
2015
230.10 December 15,
2015
(Source: www.bseindia.com)
*High and low prices are based on the high and low of the daily prices
NSE
Week Ended on Closing Price
(`)
Highest Price
(`)*
Date of High Low price (`)* Date of Low
January 8, 2016 248.75 269.90 January 5,
2016
244.00 January 8, 2016
January 1, 2016 255.05 256.95 December 30,
2015
237.25 December 28,
2015
December 24,
2015
242.10 248.00 December 21,
2015
238.70 December 21,
2015
December 18,
2015
240.35 262.65 December 17,
2015
230.00 December 14,
2015
(Source: www.nseindia.com)
* High and low prices are based on the high and low of the daily prices
The closing market price of our Equity Shares as onJanuary 13, 2016, the trading day immediately prior to the
date of the Letter of Offer, was ` 229.50 and ` 228.75 on BSE and NSE, respectively.
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MATERIAL DEVELOPMENTS
In accordance with circular no.F.2/5/SE/76 dated February 5, 1977 issued by the Ministry of Finance,
Government of India, as amended by Ministry of Finance, Government of India through its circular dated March
8, 1977, our working results on a standalone basis for the period from April 1, 2015 to November 30, 2015 are
set out in the table below:
(` in lacs)
Particulars Amount
Sales/ Income from operations 154,517.40
Other Income 427.15
Estimated Gross Profit excluding Depreciation & Taxes 6,045.10
Provision for Depreciation 3,275.34
Provision for Taxation 932.16
Estimated Net Profit/(loss) 1,837.60
Our working results on a consolidated basis for the period from April 1, 2015 to November 30, 2015 are set out
in the table below:
(` in lacs)
Particulars Amount
Sales/ Income from operations 163,965.43
Other Income 713.55
Estimated Gross Profit excluding Depreciation & Taxes (101.62)
Provision for Depreciation 5,528.00
Provision for Taxation 932.16
Estimated Net Profit/(loss) (6,561.77)
Material changes and commitments, if any, affecting our financial position
There are no material changes and commitments, other than as disclosed below/Stock Excahnges, which are
likely to affect our financial position since March 31, 2015 till date of the Letter of Offer.
The Company Secretary and Compliance Officer of the Company, Mr. Suresh Savaliya, resigned on
September 29, 2015 and the vacancy was filed by appointment of new company secretary, Mr. Sandeep
Kumar Sharma on December 31, 2015.
One of our executive directors and key managerial personnel, Mr. Manoj Kumar Singh resigned with
effect from October 13, 2015.
Our Company declared a dividend, on September 29, 2015, at the rate of 10% i.e ` 1 per Equity Share of ` 10 each, on the paid up equity share capital of our Company, for the financial year ended March 31, 2015.
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SECTION VII – LEGAL AND OTHER INFORMATION
OUTSTANDING LITIGATIONS AND DEFAULTS
Except as described below, there are no outstanding litigations including, suits, criminal or civil prosecutions
and taxation related proceedings against our Company, our Subsidiaries and our Joint Ventures that would
have a material adverse effect on our business. Further, there are no defaults, non-payment of statutory dues
including, institutional/ bank dues and dues payable to holders of any debentures, bonds and fixed deposits that
would have a material adverse effect on our business other than unclaimed liabilities against us as of the date of
the Letter of Offer.
Further, except as disclosed below, we are not aware of any litigation involving moral turpitude, material
violations of statutory regulations and or proceedings relating to economic offences which have arisen in the
last ten years.
Further, except as disclosed below, our Company, our Subsidiaries and our Joint Ventures are not subject to:
(a) Any other outstanding litigations which do not impact our future revenues which have monetary value of
more than 1% of our networth, for the last completed financial year or
(b) Any other outstanding litigations which impact our future revenues, which have monetary value of more
than 1% of our revenue, for the last completed financial year.
Further from time to time, our Company, our Subsidiaries and our Joint Ventures have been and continue to be
involved in legal proceedings filed by and against our Company, our Subsidiaries and our Joint Ventures
respectively, arising in the ordinary course of our business. These legal proceedings are both in the nature of
civil, labour and tax proceedings. We believe that the number of proceedings in which we are/ were involved is
not unusual for a company of our size doing business in India.
Litigation against our Company
1. D.R. Garments Private Limited (“DRGPL”) filed an application under Section 34 of the Arbitration and
Conciliation Act, 1996 before the Porbandar District Court, challenging the ex-parte arbitral award dated
April 18, 2012. The said award interalia directed DRGPL to pay approximately Rs.897 lacs along with
simple interest at the rate of 12% per annum, against the outstanding bills in relation to a contract granted to
our Company. The said application of DRGPL was dismissed by the order dated September 30, 2015 of the
principal District Judge Porbandar. Our Company, in its capacity as creditor of DRGPL, has already filed a
petition before the Gujarat High court for the winding up of DRGPL. This matter is currently pending.
Civil Proceedings against JMC’s subsidiaries/SPVs/ Joint Ventures
1. National Highway Authority of India (“NHAI”) has filed a miscellaneous petition before the Delhi High
Court challenging the arbitral award dated March 29, 2010 interalia directing NHAI to pay a sum of
approximately Rs 579 lacs plus interest to Agrawal- JMC Joint Venture. The matter relates to the four
laning and strengthening existing 2 lane national highway number NH- 45 B from Trichy bypass end to
Tovarankurchi that was being undertaken by Agrawal- JMC Joint Venture for delay during the execution of
the project. The matter is currently pending.
2. National Highway Authority of India (“NHAI”) has filed a miscellaneous petition before the Delhi High
Court challenging the arbitral award dated March 29, 2010 interalia directing NHAI to pay a sum of
approximately Rs 590 lacs plus interest to Agrawal- JMC Joint Venture. The matter relates to the four
laning and strengthening existing 2 lane national highway number NH- 45 B from Tovarankurchi to
Madurai, that was being undertaken by Agrawal- JMC Joint Venture for delay during the execution of the
project. The matter is currently pending.
3. NHAI has filed a miscellaneous petition before the Delhi High Court, challenging an arbitral award dated
April 30, 2014 interalia directing NHAI to pay a sum of approximately Rs 4,000 lacs plus interest to
Agrawal-JMC Joint Venture. The matter relates to the four laning and strengthening existing 2 lane national
highway number NH- 45 B from Tovarankurchi to Madurai, that was being undertaken by Agrawal- JMC
Joint Venture for delay during the execution of the project. The matter is currently pending.
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4. NHAI has filed a miscellaneous petition before the Delhi High Court, challenging the arbitral award
directing NHAI to pay a sum of approximately Rs. 4,460 lacs plus interest, to Agrawal-JMC Joint Venture.
The matter relates to the four laning and strengthening existing 2 lane national highway number NH- 45 B
from Trichy bypass to Tovarankurchi that was being undertaken by Agrawal- JMC Joint Venture for delay
during the execution of the project. The matter is currently pending.
5. Rewa Truck Transport Association (“Petitioner”) has filed a writ petition before Madhya Pradesh High
Court at Jabalpur against Union of India, Vindhyachal Expressway Private Limited (“VEPL, special
purpose vehicle of our Company”) and others alleging that VEPL was collecting ten times of the fees on
overloaded vehicles but is not ensuring removal of excess load from vehicles and permitting plying of
overloaded vehicle which is a violation of notification dated December 30, 2014 issued by Ministry of Road
Transport and Highways, Government of India. The Petitioner interalia praying for writ of mandamus, writ
of prohibition and other reliefs. The matter is currently pending.
6. A public interest litigation was filed by Lal Singh, a social worker (“Petitioner”) against National Highway
Authority of India (“NHAI”), Wainganga Expressway Private Limited (“WEPL, a special purpose vehicle
of our Company”) and Artefact Projects Limited, the independent engineer of the project before the High
Court of Judicature at Bombay. The allegation is that the construction of four laning of Nagpur –
Wainganga road project built by WEPL does not meet the specifications of Indian Road Congress and the
Concession Agreement. The Petitioner prayed for high level enquiry into the matter. The matter is
currently pending.
7. A public interest litigation was filed by Prabhat Mishra (“Petitioner”) against Union of India, National
Highway Authority of India, M. P. Road Development Corporation, our Company and Vindhyachal
Expressway Private Limited (“VEPL, subsidiary of our Company”) before the High Court of Madhya
Pradesh, Jabalpur alleging that access roads on the project highway have not been properly planned and
constructed, that illegal constructions have mushroomed on the project highway and the same is hampering
traffic and causing accidents. It is also alleged that provisional certificate has been granted to VEPL even
before completion of 75% of the works. The Petitioner has interalia praying for removal of illegal
constructions, making proper access roads and other reliefs. The matter is currently pending.
Labour Proceedings
1. Nirmaladevi Nagale (“Claimant”), a legal representatives of Ram Singh Nigele, a worker of sub-contractor
of our Company has filed an application under section 22 of the Employees Compensation Act, 1923
(“Act”) before Workmen Commissioner Nagpur, interalia praying determination of amount of
compensation under Act on account of accidental death of Ram Singh Nigela during the course of
employment, interest and penalty. Further Claimant filed an amendment application for impleading
Wainganga Expressway Private Limited, our joint venture (WEPL) as a necessary party as the project on
which Ram Singh Nigele was working was entrusted to WEPL. Further, WEPL filed reply denying the
liability. The matter is currently pending.
Indirect Taxation
1. The Deputy Commissioner of Sales Tax, Pune has passed an order under Maharashtra Value Added Tax,
Act 2002 (“MVAT”) for financial year 2008-09 imposing MVAT liability of approximately Rs 789 lacs
including interest on our Company. Aggrieved, our Company has filed an appeal before the Joint
Commissioner (Appeals) of Sales Tax, Pune. The matter is currently pending.
2. The Deputy Commissioner of Commercial Taxes, Dehradun (“Authority”) issued an assessment order dated
May 7, 2014 imposed a value added tax of approximately Rs. 549 lacs (“Assessment Order”) against our
Company for the financial year 2010-11. The Authority has found that our Company has shown nil sales
and made various purchases till November, non-availability of documents for readymade concrete and non
availability of tax deduction certificate in respect of Rs 3,675 lacs. Our Company has filed an application
dated August 11, 2014 before the Authority to set aside an Assessment Order. The matter is currently
pending.
3. The Deputy Commissioner of Sales Tax, Delhi has passed an order under section 32 of Delhi Value Added
Tax, Act 2004 (“DVAT”) dated August 28, 2013 for financial year 2012-13 imposing DVAT liability of
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approximately Rs 489 lacs including interest on our Company. Aggrieved, our Company has filed an
objection before the Objection Hearing Authority, New Delhi. The matter is currently pending.
4. Excise and Taxation Officer-cum-Assessing Authority, Gurgaon (“Authority”) has issued an assessment
order under Haryana Value Added Tax, 2003 (“HVAT”) imposing HVAT liability of approximately Rs.
2,047 lacs (“Assessment Order”) including interest and central sales tax liability of approximately Rs 2 lacs
against our Company for the assessment year 2011-12 due to non-submission of books of accounts, original
invoices, bank statements, etc.Since there was no alternative remedy and in absence of non coopearation
from our Company, the Authority has passed an Assessment Order. Aggrieved, our Company has filed an
application against an Assessment Orderbefore the Joint Excise & Taxation Commissioner (Appeal),
Haryana. The matter is currently pending
Service Tax
1. The Commissioner of Service Tax, Ahmedabad (“Authority”) issued a show cause notice (“SCN”) in
relation to the period between June 1, 2007 to July 31, 2008 (“Show Cause Notice”) against our Company,
demanding our Company to show cause as to why the service tax of approximately Rs 2,179 lacs should not
be demanded and recovered under section 73 of the Finance Act, 1994, interest should not be demanded
and recovered under section 75 of the Finance Act, 1994 and penalty should not be imposed under section
76 and section 78 of the Finance Act, 1994. Further, our Company filed reply denying all allegations. The
Authority vide order dated October 28, 2010 (“Order”) confirmed the demand along with interest , penalty
of Rs 2,179 lacs and penalty of Rs 200 for every day during which default of payment continues.
Subsequently, our Company filed an appeal before the Customs Excise and Service Tax Appellate Tribunal
which upheld the SCN through its order dated March 31, 2014. Aggrieved, our Company filed an appeal
before the Ahmedabad High Court (“High Court”) interalia praying for setting aside the Order. The High
Court vide order dated April 24, 2014 remanded the case to the Commissioner of Service Tax, Ahmedabad.
The matter is currently pending
2. The Commissioner of Service Tax, Ahmedabad (“Authority”) issued a show cause notice (“SCN”) in
relation to the period between August 1, 2008 to July 31, 2009 (“Show Cause Notice”) against our
Company, demanding our Company to show cause as to why the service tax of approximately Rs 422 lacs
should not be demanded and recovered under section 73 of the Finance Act, 1994, interest should not be
demanded and recovered under section 75 of the Finance Act, 1994 and penalty should not be imposed
under section 76 and section 78 of the Finance Act, 1994. Further, our Company filed reply denying all
allegation. The Authority vide order dated October 29, 2010 (“Order”) confirmed the demand along with
interest, penalty of approximately Rs 422 lacs and penalty of Rs 200 for every day during which default of
payment continues. Subsequently, our Company filed an appeal before the Customs Excise and Service Tax
Appellate Tribunal which upheld the SCN through its order dated March 31, 2014. Aggrieved, our
Company filed an appeal before the Ahmedabad High Court (“High Court”) interalia praying for setting
aside the Order. The High Court vide order dated April 24, 2014 remanded the case to the Commissioner of
Service Tax, Ahmedabad. The matter is currently pending.
3. The Commissioner of Service Tax, Ahmedabad has issued a Show Cause Notice (“SCN”) against our
company imposing Service tax of approximately Rs. 2,506 lacs pertaining to the period from 2008-09 to
2012-13. The said SCN was issued against non-payment of service tax on the service of construction of
pipelines under the category of commercial or industrial construction services. Aggrieved, our Company
has filed the reply denying all the allegations. The matter is currently pending.
4. A Show Cause cum Demand Notice issued by the Additional Director General Central Excise Intelligence,
Ahmedabad against our Company to show cause why the service tax of approximately Rs. 551 lacs should
not be demanded & recovered under section 73(1) of the finance act, 1994, interest should not be demanded
and recovered under section 75 of the Finance Act, 1994 and penalty should not be imposed under section
77 of the Finance Act, 1994 for the period 2010-11 to 2014-15.The matter is currently pending.
Income Tax
1. The Deputy Commissioner of Income Tax, Ahmedabad (“Authority”) issued an assessment order dated
March 28, 2014 in relation to assessment year 2008-09 to our Company. The Authority has made an
addition of approximately Rs. 2,504 lacs to the taxable income of our Company towards the disallowance of
deductions in respect of provision for leave encashment and gratuity provision, defect liability provision,
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deduction under section 80IA of Income Tax Act, 1961(“Act”) and disallowance under section 14 A due to
the retrospective amendment under the Act. Aggrieved, our Company has filed an appeal before the Deputy
Commissioner (Appeals) of Income Tax (Appeals) and Commissioner of Income Tax (Appeals). The matter
is currently pending.
2. The Deputy Commissioner of Income Tax, Ahmedabad (“Authority”) issued an assessment order dated
March 28, 2014 in relation to assessment year 2009-10 to our Company. The Authority has made an
addition of approximately Rs 4,510 lacs to the taxable income of our Company towards the disallowance of
deductions in respect of provision for leave encashment and gratuity provision, defect liability provision,
deduction under section 80IA of Income Tax Act, 1961(“Act”) and disallowance under section 14 A due to
the retrospective amendment under the Act. Aggrieved, our Company has filed an appeal before the Deputy
Commissioner (Appeals) of Income Tax (Appeals) and Commissioner of Income Tax (Appeals). The matter
is currently pending.
3. The Deputy Commissioner of Income Tax, Ahmedabad (“Authority”) issued an assessment order dated
March 28, 2014 in relation to assessment year 2010-11 to our Company. The Authority has made an
addition of approximately Rs 5,736 lacs to the taxable income of our Company towards the disallowance of
deductions in respect of provision for leave encashment and gratuity provision, defect liability provision,
deduction under section 80IA of Income Tax Act, 1961(“Act”) and disallowance under section 14 A due to
the retrospective amendment under the Act. Aggrieved, our Company has filed an appeal before the Deputy
Commissioner (Appeals) of Income Tax (Appeals) and Commissioner of Income Tax (Appeals). The matter
is currently pending.
4. The Deputy Commissioner of Income Tax, Ahmedabad (“Authority”) issued an assessment order dated
March 28, 2014 in relation to assessment year 2011-12 to our Company. The Authority has made an
addition of approximately Rs 1,697 lacs to the taxable income of our Company towards the disallowance of
deductions in respect of provision for leave encashment and gratuity provision, defect liability provision,
deduction under section 80IA of Income Tax Act, 1961(“Act”) and disallowance under section 14 A due to
the retrospective amendment under the Act. Aggrieved, our Company has filed an appeal before the Deputy
Commissioner (Appeals) of Income Tax (Appeals) and Commissioner of Income Tax (Appeals). The matter
is currently pending.
5. The Deputy Commissioner of Income Tax, Ahmedabad (“Authority”) issued an assessment order dated
March 28, 2014 in relation to assessment year 2012-13 to our Company. The Authority has made an
addition of approximately Rs 6,907 lacs to the taxable income of our Company towards the disallowance of
deductions in respect of provision for leave encashment and gratuity provision, defect liability provision,
deduction under section 80IA of Income Tax Act, 1961(“Act”) and disallowance under section 14 A due to
the retrospective amendment under the Act. The Authority has also initiated penalty proceeding under
section 271(1)(c) of the Act. Aggrieved, our Company has filed an appeal before the Deputy Commissioner
(Appeals) of Income Tax (Appeals) and Commissioner of Income Tax (Appeals). The matter is currently
pending.
Pending Notices against our Company
1. Our Company has received a legal notice dated March 26, 2014 (“Notice”) from Mr. Satyadev and two
others, interalia claiming Rs. 2,000 per day from August 26, 2013 till the restoration of possession of land,
for the extended use of the land after the expiry of the license to our Company. Our Company vide its reply
dated April 29, 2014 interalia denied the claim stating that the payments due under the license agreement
had been made and no further payments were due, as the said land was acquired by the Government and
handed over to our Company. No further communication has been received by our Company in relation to
the said Notice.
2. Deputy Superintendent of Police, Economic Offences Wing, Rewa, Madhya Pradesh (“Authority”) issued a
notice dated May 02, 2015 to our Company seeking certain information about the toll collection and
overloading. Subsequently our Company furnished the information / documents available with it to the
Authority.
Outstanding litigation filed by our Company and Joint Ventures
Civil Proceedings
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1. Our Company has filed a recovery suit dated December 11, 2011 before the City Civil Court, Secunderabad
against Bhagyanagar Infrastructure Limited, Megasoft Limited, Subramnaiya Constructions Limited, and
Prakruti Infrastructure Limited interalia for the non-payment of approximately Rs.1,660 lacs plus interest at
the rate of 24% per annum owed in relation to the construction work executed by our Company. The
contract for the execution of construction work was awarded by Bhagyanagar Infrastructure Limited and it
was agreed subsequently that Prakruti Infrastructure Limited would make the payments to our Company.
Our Company, in its capacity as creditor of, has also filed a petition before the Andhra Pradesh High court
for the winding up of M/s. Bhagyanagar Infrastructure Limited. The matter is currently pending.
2. Our Company has filed a special leave petition dated February 10, 2012 before the Supreme Court of India,
interalia challenging the order of the Allahabad High Court dated November 11, 2011 (which was
corrected vide order dated November 21, 2011)whereby the writ petition (“Writ Petition”) filed by our
projects against the State of Uttar Pradesh was dismissed. The Writ Petition was filed to challenge the
constitutionality of the levy of transit fee under Uttar Pradesh Transport of Timber and Other Forest
Produce Rules, 1978. The matter is currently pending.
3. Our Joint Venture, JMC – CHEC Joint Venture(“Petitioner”) filed a suit for permanent and mandatory
injunction dated May 13, 2015 before District and Session Judge Karkardooma, New Delhi against M/s
Neelam Roy and others (“Defendants”) restraining them from entering the project premises in order to
complete the project smoothly. Defendants had misbehaved, manhandled on the project site threatening the
employees of Petitioner and has used unlawful means to continue work at project site without adhering to
rules and instruction of Petitioner. The matter is currently pending.
4. Our Company filed a writ petition against Bangalore Metro Rail Corporation Limited (“BMRCL”) and
others before the High Court of Karnataka, Bangaluru to restrain them from acting or taking any further
action in pursuance to the communication dated December 17, 2015 from BMRCL directing our Company
to deposit an amount of approximately Rs. 3,505 lacs, as liquidated damages for the alleged delay caused
in the construction of the elevated structures (viaduct) of approximately 2.5 km from Peenya Village Station
(excluding) to Hesaraghatta Cross (including) and construction of three elevated metro stations viz.
Jalahalli, Dasarahalli and Hesaraghatta Cross Stations in Phase -3 extension of North side of N-S corridor
of Bangalore metro rail project – phase 1 (“the Project”). This Writ was necessitated as BMRCL also
threatened to encash bank guarantees that were furnished by our Company at the time of awarding the
Project. The high court granted interim stay till the next date of hearing. The matter is currently pending
Criminal Proceedings
1. Our Company has filed a complaint dated January 7, 2009 before the Chief Judicial Magistrate, Ahmedabad
(Rural) against D.R. Garments (India) Private Limited and its directors, alleging that the cheque issued by it
for approximately Rs.150 lacs in favour of JMC Projects was dishonoured. The matter has been transferred
to the Judicial Magistrate First Class, Ahmedabad, which court has further transferred the matter to
Porbandar Court, in pursuance of the guidelines issued by Supreme Court of India. The matter is currently
pending.
2. Our Company filed a complaint before the court of the XIVth Additional Chief Metropolitan Magistrate,
Bangalore, against Specific Fabs, alleging that the cheque issued by them for approximately Rs 3 lacs in
favour of our Company was dishonoured. The matter is currently pending.
3. Our Company has filed a complaint dated June 25, 2013 before the court of the VII Additional Chief
Metropolitan Magistrate, Hyderabad against Sri Srinivasa and Company, and P. Subba Rao (“Accused”)
alleging that the cheque issued by Accused for approximately Rs 20 lacs in favour of our Company was
dishonoured and interalia praying for compensation of twice the amount mentioned under cheque. The
matter is currently pending.
4. Our Company has filed a complaint dated March 25, 2008 before the court of the XIV Additional Chief
Metropolitan Magistrates, Bangalore against Mr. V. T. Srinivasan (“Accused”) alleging that the cheque
issued by Accused for approximately Rs 5 lacs in favour of our Company was dishonoured and interalia
prayed to punish and direct Accused to pay twice the amount of cheque. The matter is currently pending.
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5. Our Company filed a complaint in April, 2009 against Prakruti Infrastructure and Development Company
Limited (“Prakruti Infrastructure”) before the Magistrate, Bangalore, alleging the dishonour of cheque of
approximately Rs.342 lacs issued in favour of our Company. The Magistrate, through his order dated
October 5, 2012, found that Prakruti Infrastructure was guilty of the offence under Section 138, Negotiable
Instrument Act, 1881. Subsequently, Prakruti Infrastructure preferred an appeal before the Sessions Court,
Bangalore, which upheld the order of the Magistrate. Aggrieved by the same, Prakruti Infrastructure has
filed a criminal revision petition before the Karnataka High Court, which is currently pending.
6. JMC – CHEC Joint Venture (“Complainant”) filed a complaint against M/s Neelam Roy, United
Constructions and M/s Prity Singh (“Accused”) with the Anand Vihar Police Station for cheating, forgery,
criminal trespass, miss-behaving, manhandling and abusing the staff at the project site. Thereafter, an
application under section 156(3) of Criminal Proceeding Code was filed in the court of Chief Metropolitan
Magistrate, Karkardooma Court, New Delhi for direction to the station house officer, Anand Vihar police
station to register an FIR against the Accused. The matter is currently pending.
Criminal Proceedings against the Joint Venture
1. Mr. Pradeep Kumar Singh, a partner of Orbital Engineering Company (“Complainant”) has filed a first
information report under sections 406, 506 and 34 of the Indian Penal Code 1860 interalia alleging
that certain employees of the KPTL –JMC-Yadav JV, a joint venture consortium represented by KPTL are
not letting the Complainant take away his machinery. The matter is currently pending.
Arbitration Proceedings
1. Our Company has initiated two arbitration proceedings against the Delhi Metro Rail Corporation Limited
(“DMRC”) before an Arbitral Tribunal in respect of civil works for construction of three elevated stations.
The DMRC caused delay in execution of the construction contract due to which our Company incurred
additional costs. The claim involved in both the arbitration is aggregating upto Rs. 553 lacs. The Arbitral
Tribunal vide award dated August 13, 2015 passed order in favour of our Company awarding Rs 90 lacs.
The matter is currently pending.
2. Our Company has initiated arbitration proceedings against Central Public Works Department (“CPWD”)
before an Arbitral Tribunal in relation to contract work of indoor cycling velodrome at Indira Gandhi
Stadium Complex, New Delhi for commonwealth games. Our Company completed contract work and
interalia prayed for Rs 1,029 lacs along with interest on account of delayed payment. The matter is
currently pending
3. Our Company has initiated arbitration proceedings against Central Public Works Department (“CWPD”),
Government of Delhi in connection with construction of Thyagaraj Sports Complex at New Delhi for
Commonwealth games. Even after completion of the work and defect liability period, CWPD Delhi was
insisting on renewing the Bank Guarantees furnished by our Company, citing some pending audit para of
CAG. When CPWD failed to appoint Arbitrator after receipt of our Companies request for arbitration, our
Company filed a petition before the Delhi High Court interalia for the appointment of arbitrator. The Delhi
High Court appointed Justice Reva Khetrapal, a retired judge of Delhi High Court as sole arbitrator.The
arbitration proceedings have been initiated against CPWD, before Arbitrator Justice Reva Khetrapal. The
matter is currently pending.
4. Pursuant to the order passed by the Dispute Board created under a contract, JMC-Taher Ali Joint Venture
filed arbitration petition in October, 2013 against Indore Municipal Corporation (“IMC”) before the
Madhya Pradesh Arbitration Tribunal for the recovery of money towards the following items: a) excavation
of hard rock, b) payment due towards TMT steel, and c) escalation costs. The matter relates to the execution
of a work contract awarded by the IMC. The claim involved is approximately Rs.627 lacs along with
interest. The matter is currently pending.
5. KPTL-JMC-Yadav JV, a joint venture consortium represented by KPTL; our Company and G.B.Yadav &
Company Private Limited has filed a statement of claim before an Arbitration Tribunal against South
Eastern Railways represented by the President of India interalia claiming for loss of profit and prolongation
of contract pertaining to Deshpran - Nandigram new rail Link, on account of the failure of performance of
obligations and reciprocal obligations by the South Eastern Railways in terms of the contract entered into
between KPTL-JMC-Yadav JV and South Eastern Railways, release of earnest money deposit, retention
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money, bank guarantee and other reliefs. The claim amount involved is approximately Rs 3,290 lacs
excluding interest. The South Eastern Railways have filed a counter statement claiming an amount of Rs 30
lacs. The matter is currently pending
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GOVERNMENT AND OTHER APPROVALS
We have received the necessary consents, licenses, permissions and approvals from the Government of India
and various governmental agencies required for our present business and to undertake the Issue and no further
material approvals are required for carrying on our present activities. In addition, except as mentioned in this
section “Government and Other Approvals”, as on the date of the Letter of Offer, there are no pending
regulatory and government approvals and no pending renewals of licenses or approvals in relation to the
activities undertaken by us or in relation to the Issue.
I. Approvals for the Issue:
1. Board resolutions dated September 11, 2015 approving the Issue.
2. In-principle approval from BSE dated October 23, 2015.
3. In-principle approval from NSE dated October 8, 2015.
4. RBI approval dated January 7, 2016 in relation to pricing of Equity Shares renounced in favour of
persons resident outside India.
II. Approvals for its business:
We have received the necessary consents, licenses, permissions and approvals from the Government of
India and various governmental agencies required for our present business and no further material
approvals are required for carrying on our present activities. In the event, some of the approvals and
licenses that are required for our business operations expire in the ordinary course of business, we shall
apply for their renewal.
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OTHER REGULATORY AND STATUTORY DISCLOSURES
Authority for the Issue
The Issue of Equity Shares to the Eligible Equity Shareholders is being made in accordance with the resolution
passed by our Board of Directors under Section 62(1)(a) and other provision of the Companies Act, at its
meeting held on September 11, 2015.
The Board of Directors in their meeting held on December 31, 2015 have determined the Issue Price as ` 201
per Equity Share and the Rights Entitlement as 2 Equity Share(s) for every 7 Equity Share(s) held on the Record
Date. The Issue Price has been arrived at in consultation with Inga Capital Private Limited, Lead Manager.
Prohibition by SEBI or RBI
Neither we, the Promoter, the Promoter Group entities, the Directors nor any other company to which the above
persons are associated as promoters, directors or persons in control, have been prohibited from accessing or
operating in the capital markets, or restrained from buying, selling or dealing in securities under any order or
direction passed by the SEBI.
None of the directors of the Company are associated with the capital market in any manner. SEBI has not
initiated action against any entity with which the Directors are associated.
Further neither us, the Promoter, the Promoter Group entities, the Group Companies nor the relatives of the
Promoter have been declared wilful defaulters by the RBI or any other authority and no violations of securities
laws have been committed by them in the past and no proceedings in relation to such violations are currently
pending against them.
Except as stated in the section titled “Our Management” on page 67 of the Letter of Offer, none of our directors
hold current or have held directorships in the last five years in a listed company whose shares have been
suspended from trading on BSE or NSE or in a listed company that has been/ was delisted from any stock
exchange.
Eligibility for the Issue
We are a Company incorporated under the Companies Act, 1956 and our Equity Shares are listed on BSE and
NSE. We are eligible to undertake the Issue in terms of Chapter IV of the SEBI ICDR Regulations.
We are eligible to make disclosures in the Letter of Offer as per clause (5) Part E of Schedule VIII of the SEBI
ICDR Regulations, as we are in compliance with the following:
(a) we have been filing periodic reports, statements and information in compliance with the listing
regulation for the last three years immediately preceding the date of filing the Draft Letter of Offer with
SEBI;
(b) the reports, statements and information referred to in sub-clause (a) above are available on the website
of the BSE and the NSE which are recognised stock exchange with nationwide trading terminals;
(c) we have an investor grievance-handling mechanism which includes meeting of the Shareholders’ or
Investors’ Grievance Committee at frequent intervals, appropriate delegation of power by the Board as
regards share transfer and clearly laid down systems and procedures for timely and satisfactory
redressal of investor grievances.
Complinace with Regulation 4(2) of the SEBI Regulations
Our Company is in compliance with the conditions specified in regulation 4(2) of the SEBI
Regulations, to the extent applicable.
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DISCLAIMER CLAUSE OF SEBI
AS REQUIRED, A COPY OF THE DRAFT LETTER OF OFFER HAS BEEN SUBMITTED TO SEBI.
IT IS TO BE DISTINCTLY UNDERSTOOD THAT THE SUBMISSION OF THE DRAFT LETTER OF
OFFER TO SEBI SHOULD NOT, IN ANY WAY BE DEEMED OR CONSTRUED THAT THE SAME
HAS BEEN CLEARED OR APPROVED BY SEBI. SEBI DOES NOT TAKE ANY RESPONSIBILITY
EITHER FOR THE FINANCIAL SOUNDNESS OF ANY SCHEME OR THE PROJECT FOR WHICH
THE ISSUE IS PROPOSED TO BE MADE, OR FOR THE CORRECTNESS OF THE STATEMENTS
MADE OR OPINIONS EXPRESSED IN THE DRAFT LETTER OF OFFER. THE LEAD MANAGER,
INGA CAPITAL PRIVATE LIMITED, HAS CERTIFIED THAT THE DISCLOSURES MADE IN THE
DRAFT LETTER OF OFFER ARE GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH
SEBI (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009, IN
FORCE FOR THE TIME BEING. THIS REQUIREMENT IS TO FACILITATE INVESTORS TO
TAKE AN INFORMED DECISION FOR MAKING INVESTMENT IN THE PROPOSED ISSUE.
IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE COMPANY IS PRIMARILY
RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT
INFORMATION IN THE DRAFT LETTER OF OFFER, THE LEAD MANAGER IS EXPECTED TO
EXERCISE DUE DILIGENCE TO ENSURE THAT THE COMPANY DISCHARGES ITS
RESPONSIBILITY ADEQUATELY IN THIS BEHALF AND TOWARDS THIS PURPOSE THE LEAD
MANAGER, INGA CAPITAL PRIVATE LIMITED, HAS FURNISHED TO SEBI A DUE DILIGENCE
CERTIFICATE DATED SEPTEMBER 23, 2015 WHICH READS AS FOLLOWS:
1. WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO
LITIGATION LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH
COLLABORATORS, ETC. AND OTHER MATERIAL IN CONNECTION WITH THE
FINALISATION OF THE DRAFT LETTER OF OFFER PERTAINING TO THE ISSUE;
2. ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE COMPANY,
ITS DIRECTORS AND OTHER OFFICERS, OTHER AGENCIES, AND INDEPENDENT
VERIFICATION OF THE STATEMENTS CONCERNING THE OBJECTS OF THE ISSUE,
PRICE JUSTIFICATION AND THE CONTENTS OF THE DOCUMENTS AND OTHER PAPERS
FURNISHED BY THE COMPANY, WE CONFIRM THAT:
(a) THE DRAFT LETTER OF OFFER FILED WITH SEBI IS IN CONFORMITY WITH THE
DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO THE ISSUE;
(b) ALL THE LEGAL REQUIREMENTS RELATING TO THE ISSUE AS ALSO THE
REGULATIONS GUIDELINES, INSTRUCTIONS, ETC. FRAMED/ ISSUED BY SEBI, THE
GOVERNMENT OF INDIA AND ANY OTHER COMPETENT AUTHORITY IN THIS
BEHALF HAVE BEEN DULY COMPLIED WITH; AND
(c) THE DISCLOSURES MADE IN THE DRAFT LETTER OF OFFER ARE TRUE, FAIR AND
ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL INFORMED DECISION
AS TO THE INVESTMENT IN THE PROPOSED ISSUE AND SUCH DISCLOSURES ARE IN
ACCORDANCE WITH THE REQUIREMENTS OF THE COMPANIES ACT, 1956 AND
COMPANIES ACT, 2013, THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE
OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009, AS AMENDED
AND OTHER APPLICABLE LEGAL REQUIREMENTS.
3. WE CONFIRM THAT BESIDES OURSELVES, ALL THE INTERMEDIARIES NAMED IN
THE DRAFT LETTER OF OFFER ARE REGISTERED WITH SEBI AND THAT UNTIL DATE
SUCH REGISTRATION IS VALID.
4. WE HAVE SATISFIED OURSELVES ABOUT THE CAPABILITY OF THE UNDERWRITERS
TO FULFIL THEIR UNDERWRITING COMMITMENTS – NOT APPLICABLE. THE
COMPANY HAS NOT ENTERED INTO ANY UNDERWRITING ARRANGEMENT FOR THE
ISSUE.
158
5. WE CERTIFY THAT WRITTEN CONSENT FROM PROMOTER HAS BEEN OBTAINED FOR
INCLUSION OF THEIR SPECIFIED SECURITIES AS PART OF PROMOTER’S
CONTRIBUTION SUBJECT TO LOCK-IN AND THE SPECIFIED SECURITIES PROPOSED TO
FORM PART OF PROMOTER’S CONTRIBUTION SUBJECT TO LOCK-IN SHALL NOT BE
DISPOSED/ SOLD/ TRANSFERRED BY THE PROMOTER DURING THE PERIOD STARTING
FROM THE DATE OF FILING THE DRAFT LETTER OF OFFER WITH SEBI TILL THE DATE
OF COMMENCEMENT OF LOCK-IN PERIOD AS STATED IN THE DRAFT LETTER OF
OFFER – NOT APPLICABLE.
6. WE CERTIFY THAT REGULATION 33 OF THE SECURITIES AND EXCHANGE BOARD OF
INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009,
WHICH RELATES TO SPECIFIED SECURITIES INELIGIBLE FOR COMPUTATION OF
PROMOTER CONTRIBUTION, HAS BEEN DULY COMPLIED WITH AND APPROPRIATE
DISCLOSURES AS TO COMPLIANCE WITH THE SAID REGULATION HAVE BEEN MADE
IN THE DRAFT LETTER OF OFFER – NOT APPLICABLE.
7. WE UNDERTAKE THAT SUB-REGULATION (4) OF REGULATION 32 AND CLAUSE (C) AND
(D) OF SUB-REGULATION (2) OF REGULATION 8 OF THE SECURITIES AND EXCHANGE
BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS)
REGULATIONS, 2009 SHALL BE COMPLIED WITH. WE CONFIRM THAT ARRANGEMENTS
HAVE BEEN MADE TO ENSURE THAT PROMOTER’S CONTRIBUTION SHALL BE
RECEIVED AT LEAST ONE DAY BEFORE THE OPENING OF THE ISSUE. WE UNDERTAKE
THAT AUDITORS’ CERTIFICATE TO THIS EFFECT SHALL BE DULY SUBMITTED TO
SEBI. WE FURTHER CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO ENSURE
THAT PROMOTER’S CONTRIBUTION SHALL BE KEPT IN AN ESCROW ACCOUNT WITH
A SCHEDULED COMMERCIAL BANK AND SHALL BE RELEASED TO THE COMPANY
ALONG WITH THE PROCEEDS Of THE ISSUE – NOT APPLICABLE.
8. WE CERTIFY THAT THE PROPOSED ACTIVITIES OF THE COMPANY FOR WHICH THE
FUNDS ARE BEING RAISED IN THE PRESENT ISSUE FALL WITHIN THE OBJECTS LISTED
IN THE OBJECT CLAUSE OF THE MEMORANDUM OF ASSOCIATION OR OTHER
CHARTER OF THE COMPANY AND THAT THE ACTIVITIES WHICH HAVE BEEN
CARRIED OUT UNTIL NOW ARE VALID IN TERMS OF THE OBJECT CLAUSE OF ITS
MEMORANDUM OF ASSOCIATION.
9. WE CONFIRM THAT NECESSARY ARRANGEMENTS HAVE BEEN MADE TO ENSURE
THAT THE MONEYS RECEIVED PURSUANT TO THE ISSUE ARE KEPT IN A SEPARATE
BANK ACCOUNT AS PER THE PROVISIONS OF SUB-SECTION (3) OF SECTION 73 OF THE
COMPANIES ACT, 1956 AND THAT SUCH MONEYS SHALL BE RELEASED BY THE SAID
BANK ONLY AFTER PERMISSION IS OBTAINED FROM ALL THE STOCK EXCHANGES
MENTIONED IN THE PROSPECTUS/ LETTER OF OFFER. WE FURTHER CONFIRM THAT
THE AGREEMENT ENTERED INTO BETWEEN THE BANKERS TO THE ISSUE AND THE
ISSUER SPECIFICALLY CONTAINS THIS CONDITION. – NOTED FOR COMPLIANCE
(INCLUDING THE CORRESPONDING SECTION 40 UNDER THE COMPANIES ACT,
2013),TRANSFER OF MONIES RECEIVED PURSUANT TO THE ISSUE SHALL BE RELEASED
TO THE COMPANY AFTER FINALISATION OF THE BASIS OF ALLOTMENT IN
COMPLIANCE WITH REGULATION 56 OF THE SEBI ICDR REGULATIONS.
10. WE CERTIFY THAT A DISCLOSURE HAS BEEN MADE IN THE DRAFT LETTER OF OFFER
THAT THE INVESTORS SHALL BE GIVEN AN OPTION TO GET THE SHARES IN DEMAT
OR PHYSICAL MODE.
11. WE CERTIFY THAT ALL THE APPLICABLE DISCLOSURES MANDATED IN THE
SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE
REQUIREMENTS) REGULATIONS, 2009 HAVE BEEN MADE IN ADDITION TO
DISCLOSURES WHICH, IN OUR VIEW, ARE FAIR AND ADEQUATE TO ENABLE THE
INVESTOR TO MAKE A WELL INFORMED DECISION.
12. WE CERTIFY THAT THE FOLLOWING DISCLOSURES HAVE BEEN MADE IN THE DRAFT
LETTER OF OFFER:
159
(a) AN UNDERTAKING FROM THE ISSUER THAT AT ANY GIVEN TIME, THERE SHALL
BE ONLY ONE DENOMINATION FOR THE EQUITY SHARES OF THE COMPANY; AND
(b) AN UNDERTAKING FROM THE COMPANY THAT IT SHALL COMPLY WITH SUCH
DISCLOSURE AND ACCOUNTING NORMS SPECIFIED BY SEBI FROM TIME TO TIME.
13. WE UNDERTAKE TO COMPLY WITH THE REGULATIONS PERTAINING TO
ADVERTISEMENT IN TERMS OF THE SECURITIES AND EXCHANGE BOARD OF INDIA
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 WHILE
MAKING THE ISSUE.
14. WE ENCLOSE A NOTE EXPLAINING HOW THE PROCESS OF DUE DILIGENCE HAS BEEN
EXERCISED BY US IN VIEW OF THE NATURE OF CURRENT BUSINESS, BACKGROUND OF
THE ISSUER, SITUATION AT WHICH THE PROPOSED BUSINESS STANDS, THE RISK
FACTORS, PROMOTER EXPERIENCE, ETC.
15. WE ENCLOSE A CHECKLIST CONFIRMING REGULATION-WISE COMPLIANCE WITH
THE APPLICABLE PROVISIONS OF THE SECURITIES AND EXCHANGE BOARD OF INDIA
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009, AS
AMENDED, CONTAINING DETAILS SUCH AS THE REGULATION NUMBER, ITS TEXT, THE
STATUS OF COMPLIANCE, PAGE NUMBER OF THE DRAFT LETTER OF OFFER WHERE
THE REGULATION HAS BEEN COMPLIED WITH AND OUR COMMENTS, IF ANY.
16. WE ENCLOSE STATEMENT ON ‘PRICE INFORMATION OF PAST ISSUES HANDLED BY
MERCHANT BANKER BELOW (WHO IS RESPONSIBLE FOR PRICING THIS ISSUE)’, AS
PER FORMAT SPECIFIED BY SEBI THROUGH THE CIRCULAR – NOT APPLICABLE.
17. WE CERTIFY THAT PROFITS FROM RELATED PARTY TRANSACTIONS HAVE ARISED
FROM LEGITIMATE BUSINESS TRANSACTIONS. – COMPLIED WITH TO THE EXTENT OF
THE RELATED PARTY TRANSACTIONS OF THE COMPANY REPORTED AS PER THE
ACCOUNTING STANDARD 18 IN THE FINANCIAL STATEMENTS OF THE COMPANY
INCLUDED IN THE DRAFT LETTER OF OFFER, IN RELIANCE ON THE CERTIFICATE
DATED SEPTEMBER 21, 2015 OF M/s KISHAN M. MEHTA & Co, CHARTERED
ACCOUNTANTS, FIRM REGISTRATION NUMBER 105229W ISSUED IN ACCORDANCE
WITH ACCOUNTING STANDARD 18.
18. WE CERTIFY THAT THE ENTITY IS ELIGIBLE UNDER 106Y (1) (A) OR (B) (AS THE CASE
MAY BE) TO LIST ON THE INSTITUTIONAL TRADING PLATFORM, UNDER CHAPTER XC
OF THESE REGULATIONS. (IF APPLICABLE) – NOT APPLICABLE.
THE FILING OF THE DRAFT LETTER OF OFFER DOES NOT, HOWEVER, ABSOLVE THE
COMPANY FROM ANY LIABILITIES UNDER SECTION 34 OR SECTION 36 OF THE
COMPANIES ACT, 2013 OR FROM THE REQUIREMENT OF OBTAINING SUCH STATUTORY
OR OTHER CLEARANCE AS MAY BE REQUIRED FOR THE PURPOSE OF THE PROPOSED
ISSUE. SEBI FURTHER RESERVES THE RIGHT TO TAKE UP, AT ANY POINT OF TIME, WITH
THE LEAD MANAGER, ANY IRREGULARITIES OR LAPSES IN THE DRAFT LETTER OF
OFFER.
Caution
Disclaimer clauses from the Company and the Lead Manager
We and the Lead Manager accept no responsibility for statements made otherwise than in the Letter of Offer or
in any advertisement or other material issued by us or by any other persons at our instance and anyone placing
reliance on any other source of information would be doing so at his own risk.
We and the Lead Manager shall make all information available to the Equity Shareholders and no selective or
additional information would be available for a section of the Equity Shareholders in any manner whatsoever
including at presentations, in research or sales reports etc. after filing of the Letter of Offer with SEBI.
160
No dealer, salesperson or other person is authorized to give any information or to represent anything not
contained in the Letter of Offer. You must not rely on any unauthorized information or representations. The
Letter of Offer is rights to purchase the Equity Shares offered hereby, but only under circumstances and in
jurisdictions where it is lawful to do so. The information contained in the Letter of Offer is current only as of its
date.
Investors who invest in the Issue will be deemed to have represented to us and Lead Manager and their
respective directors, officers, agents, affiliates and representatives that they are eligible under all applicable
laws, rules, regulations, guidelines and approvals to acquire Equity Shares, and are relying on independent
advice/ evaluation as to their ability and quantum of investment in the Issue.
Disclaimer with respect to jurisdiction
The Letter of Offer has been prepared under the provisions of Indian laws and the applicable rules and
regulations thereunder. Any disputes arising out of the Issue will be subject to the jurisdiction of the appropriate
court(s) in Ahmedabad, India only.
Designated Stock Exchange
The Designated Stock Exchange for the purpose of the Issue will be BSE.
Disclaimer Clause of BSE
As required, a copy of the Draft Letter of Offer has been submitted to the BSE. The Disclaimer Clause as
intimated by the BSE to us, post scrutiny of the Draft Letter of Offer, vide its in- principle approval dated
October 23, 2015, is as under:
“BSE Limited (“the Exchange”) has given vide its letter dated October 23, 2015, permission to this Company to
use the Exchange’s name in the Letter of Offer as one of the stock exchanges on which this Company’s
securities are proposed to be listed. The Exchange has scrutinized the letter of offer for its limited internal
purpose of deciding on the matter of granting the aforesaid permission to this Company. The Exchange does not
in any manner;
(a) warrant, certify or endorse the correctness or completeness of any of the contents of the letter of offer; or
(b) warrant that this Company’s securities will be listed or will continue to be listed on the Exchange; or
(c) take any responsibility for the financial or other soundness of this Company, its promoters, its management
or any scheme or project of this Company;
And it should not for any reason be deemed or construed that the letter of offer has been cleared or approved by
the Exchange. Every person who desires to apply for or otherwise acquires any securities of this Company may
do so pursuant to independent inquiry, investigation and analysis and shall not have any claim against the
Exchange whatsoever by reason of any loss which may be suffered by such person consequent to or in
connection with such subscription/acquisition whether by reason of anything stated or omitted to be stated
herein or for any other reason whatsoever.”
Disclaimer Clause of NSE
As required, a copy of the Draft Letter of Offer has been submitted to the NSE. The Disclaimer Clause as
intimated by the NSE to us, post scrutiny of the Draft Letter of Offer, vide its in- principle approval dated
October 8, 2015, is as under
“As required, a copy of the letter of offer has been submitted to National Stock Exchange of India Limited
(hereinafter referred to as NSE). NSE has given vide its letter Ref. No. NSE/LIST/45655 dated October 08,
2015 permission to the Issuer to use the Exchange’s name in the letter of offer as one of the stock exchanges on
which this Issuer’s securities are proposed to be listed. The Exchange has scrutinized the letter of offer for its
limited internal purpose of deciding on the matter of granting the aforesaid permission to this Issuer. It is to be
distinctly understood that the aforesaid permission given by NSE should not in any way be deemed or construed
161
that the letter of offer has been cleared or approved by NSE; nor does it in any manner warrant, certify or
endorse the correctness or completeness of any of the contents of the letter of offer; nor does it warrant that this
Issuer’s securities will be listed or will continue to be listed on the Exchange; nor does it take any responsibility
for the financial or other soundness of this Issuer, its promoters, its management or any scheme or project of this
Issuer.
Every person who desires to apply for or otherwise acquire any securities of this Issuer may do so pursuant to
independent inquiry, investigation and analysis and shall not have any claim against the Exchange whatsoever
by reason of any loss which may be suffered by such person consequent to or in connection with such
subscription /acquisition whether by reason of anything stated or omitted to be stated herein or any other reason
whatsoever.”
Filing
The Draft Letter of Offer was filed with the Corporation Finance Department of the SEBI, located at
Ahemdabad, India for its observations. Pursuant to receipt of SEBI’s observations dated December 22, 2015, the
Letter of Offer is being filed with the Designated Stock Exchange as per the provisions of the Companies Act.
Selling Restrictions
The distribution of the Letter of Offer and the issue of Equity Shares on a rights basis to persons in certain
jurisdictions outside India may be restricted by the legal requirements prevailing in those jurisdictions. Persons
into whose possession the Letter of Offer may come are required to inform them about and observe such
restrictions. We are making this Issue of Equity Shares on a rights basis to our Eligible Equity Shareholders and
will dispatch the Letter of Offer/ Abridged Letter of Offer and CAFs to the Eligible Equity Shareholders who
have provided an Indian address.
No action has been or will be taken to permit this Issue in any jurisdiction where action would be required for
that purpose, except that the Draft Letter of Offer was filed with SEBI for its observations. Accordingly, the
rights or Equity Shares may not be offered or sold, directly or indirectly, and the Letter of Offer may not be
distributed in any jurisdiction, except in accordance with legal requirements applicable in such jurisdiction.
Receipt of the Letter of Offer will not constitute an offer in those jurisdictions in which it would be illegal to
make such an offer and, under those circumstances, the Letter of Offer must be treated as sent for information
only and should not be copied or redistributed. Accordingly, persons receiving a copy of the Letter of Offer
should not, in connection with the issue of the rights or Equity Shares or rights, distribute or send the same in or
into the United States or any other jurisdiction where to do so would or might contravene local securities laws or
regulations. If the Letter of Offer is received by any person in any such territory, or by their agent or nominee,
they must not seek to subscribe to the Equity Shares or the rights referred to in the Letter of Offer.
Neither the delivery of the Letter of Offer nor any sale hereunder, shall under any circumstances create any
implication that there has been no change in the Company’s affairs from the date hereof or that the information
contained herein is correct as at any time subsequent to this date.
IMPORTANT INFORMATION FOR INVESTORS – ELIGIBILITY AND TRANSFER
RESTRICTIONS
As described more fully below, there are certain restrictions regarding the rights and Equity Shares that affect
potential investors. These restrictions are restrictions on the ownership of Equity Shares by such persons
following the offer.
The rights and the Equity Shares have not been and will not be registered under the Securities Act or any
other applicable law of the United States and, unless so registered, may not be offered or sold within the
United States or to, or for the account or benefit of, U.S. persons (as defined in Regulation S under the
Securities Act) (“U.S. Persons”) except pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act and applicable state securities laws.
The rights and the Equity Shares have not been and will not be registered, listed or otherwise qualified in
any jurisdiction outside India and may not be offered or sold, and bids may not be made by persons in
any such jurisdiction, except in compliance with the applicable laws of such jurisdiction.
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Until the expiry of 40 days after the commencement of the Issue, an offer or sale of rights or Equity Shares
within the United States by a dealer (whether or not it is participating in the Issue) may violate the registration
requirements of the Securities Act.
Eligible Investors
The rights or Equity Shares are being offered and sold only to persons who are outside the United States and are
not U.S. Persons, nor persons acquiring for the account or benefit of U.S. Persons, in offshore transactions in
reliance on Regulation S under the Securities Act and the applicable laws of the jurisdiction where those offers
and sales occur. All persons who acquire the rights or Equity Shares are deemed to have made the
representations set forth immediately below.
Equity Shares and Rights Offered and Sold in this Issue
Each purchaser acquiring the rights or Equity Shares, by acceptance of the Letter of Offer and of the rights or
Equity Shares, will be deemed to have acknowledged, represented to and agreed with us and the Lead Manager
that it has received a copy of the Letter of Offer and such other information as it deems necessary to make an
informed investment decision and that:
(1) the purchaser is authorized to consummate the purchase of the rights or Equity Shares in compliance with
all applicable laws and regulations;
(2) the purchaser acknowledges that the rights and Equity Shares have not been and will not be registered
under the Securities Act or with any securities regulatory authority of any state of the United States and,
accordingly, may not be offered or sold within the United States or to, or for the account or benefit of,
U.S. Persons except pursuant to an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act;
(3) the purchaser is purchasing the rights or Equity Shares in an offshore transaction meeting the
requirements of Rule 903 of Regulation S under the Securities Act;
(4) the purchaser and the person, if any, for whose account or benefit the purchaser is acquiring the rights or
Equity Shares, is a non-U.S. Person and was located outside the United States at each time (i) the offer
was made to it and (ii) when the buy order for such rights or Equity Shares was originated, and continues
to be a non-U.S. Person and located outside the United States and has not purchased such rights or Equity
Shares for the account or benefit of any U.S. Person or any person in the United Sates or entered into any
arrangement for the transfer of such rights or Equity Shares or any economic interest therein to any U.S.
Person or any person in the United States;
(5) the purchaser is not an affiliate of the Company or a person acting on behalf of an affiliate;
(6) if, in the future, the purchaser decides to offer, resell, pledge or otherwise transfer such rights or Equity
Shares, or any economic interest therein, such rights or Equity Shares or any economic interest therein
may be offered, sold, pledged or otherwise transferred only (A) outside the United States in an offshore
transaction complying with Rule 903 or Rule 904 of Regulation S under the Securities Act and (B) in
accordance with all applicable laws, including the securities laws of the states of the United States. The
purchaser understands that the transfer restrictions will remain in effect until the Company determines, in
its sole discretion, to remove them, and confirms that the proposed transfer of the rights or Equity Shares
is not part of a plan or scheme to evade the registration requirements of the Securities Act;
(7) the purchaser agrees that neither the purchaser, nor any of its affiliates, nor any person acting on behalf of
the purchaser or any of its affiliates, will make any “directed selling efforts” as defined in Regulation S
under the Securities Act in the United States with respect to the rights or the Equity Shares;
(8) the purchaser understands that such rights or Equity Shares (to the extent they are in certificated form),
unless the Company determine otherwise in accordance with applicable law, will bear a legend
substantially to the following effect:
THE EQUITY SHARES REPRESENTED HEREBY HAVE NOT BEEN AND WILL NOT BE
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REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”) OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY
STATE OR OTHER JURISDICTION OF THE UNITED STATES AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER
THE SECURITIES ACT, AND IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES.
(9) the purchaser agrees, upon a proposed transfer of the rights or the Equity Shares, to notify any purchaser
of such rights or Equity Shares or the executing broker, as applicable, of any transfer restrictions that are
applicable to the rights or Equity Shares being sold;
(10) the Company will not recognize any offer, sale, pledge or other transfer of such rights or Equity Shares
made other than in compliance with the above-stated restrictions; and
(11) the purchaser acknowledges that the Company, the Lead Manager, their respective affiliates and others
will rely upon the truth and accuracy of the foregoing acknowledgements, representations and agreements
and agrees that, if any of such acknowledgements, representations and agreements deemed to have been
made by virtue of its purchase of such rights or Equity Shares are no longer accurate, it will promptly
notify the Company, and if it is acquiring any of such rights or Equity Shares as a fiduciary or agent for
one or more accounts, it represents that it has sole investment discretion with respect to each such account
and that it has full power to make the foregoing acknowledgements, representations and agreements on
behalf of such account.
Each person in a Member State of the EEA which has implemented the Prospectus Directive (each, a “Relevant
Member State) who receives any communication in respect of, or who acquires any rights or Equity Shares
under, the offers contemplated in the Letter of Offer will be deemed to have represented, warranted and agreed
to and with Lead Manager and the Company that in the case of any rights or Equity Shares acquired by it as a
financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive:
(i) the rights or Equity Shares acquired by it in the placement have not been acquired on behalf of, nor have
they been acquired with a view to their offer or resale to, persons in any Relevant Member State other than
qualified investors, as that term is defined in the Prospectus Directive, or in circumstances in which the
prior consent of the Lead Manager has been given to the offer or resale; or
(ii) where rights or Equity Shares have been acquired by it on behalf of persons in any Relevant Member State
other than qualified investors, the offer of those rights or Equity Shares to it is not treated under the
Prospectus Directive as having been made to such persons.
For the purposes of this provision, the expression an “offer of Equity Shares to the public” in relation to any of
the rights or Equity Shares in any Relevant Member States means the communication in any form and by any
means of sufficient information on the terms of the offer and the rights or Equity Shares to be offered so as to
enable an investor to decide to purchase or subscribe for the rights or Equity Shares, as the same may be varied
in that Relevant Member State by any measure implementing the Prospectus Directive in that Relevant Member
State.
Listing
The existing Equity Shares are listed on the BSE and the NSE. We have made applications to the BSE and the
NSE for obtaining in-principle approval in respect of the Rights Equity Shares. We will apply to the BSE and
the NSE for listing and trading of the Rights Equity Shares.
If the permission to deal in and an official quotation of the securities is not granted by any of the Stock
Exchanges mentioned above, we shall forthwith repay, without interest, all monies received from applicants in
pursuance of the Letter of Offer.
We will issue and dispatch Allotment advice/ share certificates/demat credit and/or letters of regret along with
refund order or credit the Allotted Equity Shares to the respective beneficiary accounts, if any, within a period
of 15 days from the Issue Closing Date.
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If such money is not repaid beyond eight days after our Company becomes liable to repay it, i.e., the date of
refusal of an application for such a permission from a Stock Exchange, or on expiry of 15 days from the Issue
Closing Date in case no permission is granted, whichever is earlier, then our Company and every Director who
is an officer in default shall, on and from such expiry of eight days, be liable to repay the money, with interest as
per applicable law.
Consents
Consents in writing of the Directors, the Auditor, the Lead Manager, the Legal Counsel, the Registrar to the
Issue and the Banker to the Issue to act in their respective capacities have been obtained and such consents have
not been withdrawn up to the date of the Letter of Offer.
M/s Kishan M. Mehta & Co, Chartered Accountants, our Auditor, have given their written consent for inclusion
of their name and reports appearing in the Letter of Offer and such consent have not been withdrawn up to the
date of the Letter of Offer.
Expert
Except as stated below, our Company has not obtained any expert opinions:
Our Company has received written consent from the Auditor namely, M/s Kishan M. Mehta & Co, Chartered
Accountants to include its name as an expert under Section 26 of the Companies Act, 2013 in the Letter of Offer
in relation to the (1) report of the Auditor on Audited Financial Statements dated May 29, 2015 and the (2)
limited review report on the limited reviewed unaudited standalone financial statement for quarter ended
September 30, 2015 and limited reviewed unaudited consolidated financial statements for six month ended on
Septmeber 30, 2015. Our Company has also received written consent from, M/s Kishan M. Mehta & Co,
Chartered Accountants, to include its name as an expert under Section 26 of the Companies Act, 2013 in the
Letter of Offer in relation to the report on statement of tax benefits dated December 23, 2015 and such consent
has not been withdrawn as of the date of the Letter of Offer. However, the term “expert” shall not be construed
to mean an “expert” as defined under the Securities Act.
Issue Related Expenses:
The Issue related expenses include, inter alia, Lead Manager’s fee, printing and distribution expenses,
advertisement and marketing expenses and Registrar, legal and depository fees and other expenses and are
estimated at ` 147.00 lacs (approximately 0.98% of the total Issue size) and will be met out of the proceeds of
the Issue.
(in ` lacs)
Activity Expense (in `
lacs)*
Expense
(% of total
expenses)*
Expense
(% of Issue
Size)*
Fees of Lead Manager, legal advisor, registrar to the
Issue and auditor’s including out of pocket expenses 86.74 59.01% 0.58%
Expenses relating to advertising, printing,
distribution, marketing and stationery expenses 15.05 10.24% 0.10%
Others expenses (SEBI Fees, Stock Exchange Fees,
etc.) 45.21 30.75% 0.30%
Total estimated Issue expenses 147.00 100.00% 0.98%
* Assuming full subscription and Allotment of the Rights Equity Shares in the Issue
Investor Grievances and Redressal System
We have adequate arrangements for the redressal of investor complaints in compliance with the corporate
governance requirements under the SEBI Listing Regulations. Additionally, we have been registered with the
SEBI Complaints Redress System (“SCORES”) as required by the SEBI Circular no. CIR/ OIAE/ 2/ 2011 dated
June 3, 2011. Consequently, investor grievances are tracked online by us.
The share transfer and dematerialization for us is being handled by Link Intime India Private Limited, Registrar
and Share Transfer Agent, which is also the Registrar to the Issue. Letters are filed category wise after being
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attended to. All investor grievances received by us have been handled by the Registrar and Share Transfer agent
in consultation with the Compliance Officer.
Our Stakeholders Relationship Committee comprises of Mr. Kamal Jain, Non-executive Director (Chairman of
the Stakeholders Relationship Committee), Mr. Shailendra Kumar Tripathi, CEO & Dy. Managing Director and
Mr. Manish Mohnot, Non-executive Director. Our Stakeholders Relationship Committee oversees the reports
received from the Registrar and Share Transfer agent and facilitates the prompt and effective resolution of
complaints from our shareholders and investors.
Investor Grievances arising out of the Issue
The investor grievances arising out of the Issue will be handled by Link Intime India Private Limited, the
Registrar to the Issue. The Registrar will have a separate team of personnel handling post-Issue correspondences
only.
All grievances relating to the Issue may be addressed to the Registrar to the Issue or the SCSB in case of ASBA
Applicants giving full details such as folio no. / demat account no., name and address, contact telephone/ cell
numbers, email id of the first applicant, number of Equity Shares applied for, CAF serial number, amount paid
on application and the name of the bank/ SCSB and the branch where the CAF was deposited, along with a
photocopy of the acknowledgement slip. In case of renunciation, the same details of the Renouncee should be
furnished.
The average time taken by the Registrar for attending to routine grievances will be within 30 days from the date
of receipt of complaints. In case of non-routine grievances where verification at other agencies is involved, it
would be the endeavour of the Registrar to attend to them as expeditiously as possible. We undertake to resolve
the Investor grievances in a time bound manner.
Registrar to the Issue
Link Intime India Private Limited
Pannalal Silk Mills Compound
L.B.S. Marg
Bhandup (West), Mumbai - 400 078
Maharashtra, India
Tel No.: +91 22 61715400
Fax No.: +91 22 2596 0329
Email: [email protected]
Investor Grievance E-mail: [email protected]
Website: www.linkintime.co.in
Contact Person: Dinesh Yadav
SEBI Registration: INR000004058
Investors may contact the Compliance Officer in case of any pre-Issue/ post -Issue related problems such
as non-receipt of Allotment advice/ share certificates/ demat credit/ refund orders etc. The contact details
of the Compliance Officer are as follows:
Name: Mr. Sandeep Kumar Sharma
Address: 6th Floor, Kalpataru Synergy,
Opp. Grand Hyatt,
Santacruz (East),
Mumbai 400055.
Tel: +91 22 30051500.
Fax: +91 22 30051555.
Email: [email protected]
Website: www.jmcprojects.com
Status of Complaints
(a) Total number of complaints received during Fiscal 2013: 3 Complaints
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(b) Total number of complaints received during Fiscal 2014: NIL
(c) Total number of complaints received during Fiscal 2015: NIL
(d) Time normally taken for disposal of various types of investor complaints: 15 days
(a) Share transfer process: Within 15 days after receiving full set of documents
(b) Share transmission process: Within 21 days after receiving full set of documents
(c) Other Complaints: Within 15 days from the receipt of the Complaint
Status of outstanding investor complaints
As on the date of the LOF, there were no outstanding investor complaints.
Changes in Auditor during the last three years
There has been no change in Auditor during last three years.
Minimum Subscription
If we do not receive the minimum subscription of 90% of the Issue, we shall refund the entire subscription
amount received within 15 days from the Issue Closing Date. In the event that there is a delay of making refunds
beyond such period as prescribed by applicable laws, our Company shall pay interest for the delayed period at
rates prescribed under applicable laws. The above is subject to the terms mentioned under the section titled
‘Terms of the Issue’ on page 167 of the Letter of Offer.
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SECTION VIII – OFFERING INFORMATION
TERMS OF THE ISSUE
The Rights Equity Shares proposed to be issued are subject to the terms and conditions contained in the Draft
Letter of Offer, the Letter of Offer, the Abridged Letter of Offer, including the CAF, the SAF, RBI approval,
the Memorandum of Association and Articles of Association, the provisions of the Companies Act, the terms
and conditions as may be incorporated in the FEMA, applicable guidelines and regulations issued by SEBI and
RBI, or other statutory authorities and bodies from time to time, the SEBI Listing Regulations entered into by
us, terms and conditions as stipulated in the allotment advice or security certificate and rules as may be
applicable and introduced from time to time. All rights/ obligations of Equity Shareholders in relation to
application and refunds pertaining to this Issue shall apply to the Renouncee(s) as well.
Please note that, in terms of SEBI circular CIR/CFD/DIL/1/2011 dated April 29, 2011, all QIBs, Non-
Institutional Investors (including all companies or body corporate) and other investors (applicants whose
application amount exceeds ` 200,000) complying with the eligibilty conditions of SEBI circular dated
December 30, 2009 can participate in the Issue only through the ASBA process. Further, all QIB
Investors and Non-Institutional Investors are mandatorily required to use the ASBA facility, even if
application amount does not exceed ` 200,000. All Retail Individual Investors complying with the
conditions prescribed under the SEBI circular dated December 30, 2009 may optionally apply through
the ASBA process provided they are eligible ASBA investors. The Investors who are (i) not QIBs, (ii) not
Non-Institutional Investors, or (iii) investors whose application amount is less than ` 200,000 can
participate in the Issue either through the ASBA process or the non ASBA process. ASBA Investors
should note that the ASBA process involves application procedures that may be different from the
procedure applicable to non ASBA process. ASBA Investors should carefully read the provisions
applicable to such applications before making their application through the ASBA process. For details,
please see “Procedure for Application through the Applications Supported by Blocked Amount (“ASBA”)
Process” on page 185 of the Letter of Offer. Notwithstanding anything contained hereinabove, all
Renouncees (including Renouncees who are Individuals) shall apply in the Issue only through the non-
ASBA process.
Further, in terms of the SEBI circular CIR/CFD/DIL/1/2013 dated January 2, 2013, it is clarified that for making
applications by banks on own account using ASBA facility, SCSBs should have a separate account in own name
with any other SEBI registered SCSB(s). Such account shall be used solely for the purpose of making
application in public issues/ rights issues and clear demarcated funds should be available in such account for
ASBA applications. SCSBs applying in the Issue using the ASBA facility shall be responsible for ensuring that
they have a separate account in its own name with any other SCSB having clear demarcated funds for applying
in the Issue and that such separate account shall be used as the ASBA Account for the application, for ensuring
compliance with the applicable regulations.
Please note that in terms of the SEBI (Foreign Portfolio Investors) Regulations, 2014 (“SEBI FPI
Regulations”), foreign institutional investor or qualified foreign investor who holds a valid certificate of
registration shall be deemed to be a foreign portfolio investor till the expiry of the block of three years for which
fees have been paid as per the SEBI (Foreign Institutional Investors) Regulations, 1995.
Authority for the Issue
The Issue has been authorised by a resolution of our Board passed at its meetings held on September 11, 2015
pursuant to Section 62 of the Companies Act, 2013.
Basis for the Issue
The Rights Equity Shares are being offered for subscription for cash to those existing equity shareholders whose
names appear as beneficial owners as per the list to be furnished by the Depositories for the purpose of this
Rights Issue in respect of the Equity Shares held in the electronic form and on the register of members in respect
of the Equity Shares held in physical form at the close of business hours on the Record Date, fixed in
consultation with the Designated Stock Exchange. The basis of allotment for the Rights Equity Shares shall be
fixed in consultation with the Designated Stock Exchange.
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Rights Entitlement
As your name appears as a beneficial owner in respect of the Equity Shares held in the electronic form or
appears in the register of members as an Equity Shareholder as on the Record Date, i.e., January 12, 2016, you
are entitled to the number of Equity Shares as set out in Part A of the CAFs.
Pursuant to a resolution passed by the Board of our Company at its meeting held on December 31, 2015, has
determined a Rights Entitlement of 2 Rights Equity Shares for every 7 fully paid-up Equity Shares held on the
Record Date and a price of 201 per Rights Equity Share as the Issue Price.
The distribution of the Letter of Offer and the issue of the Equity Shares on a rights basis to persons in certain
jurisdictions outside India may be restricted by legal requirements prevailing in those jurisdictions. We are
making the issue of the Equity Shares on a rights basis to the Equity Shareholders and the Letter of Offer, the
Abridged Letter of Offer and the CAFs will be dispatched only to those Equity Shareholders who have a
registered address in India or who have provided an Indian address. Any person who acquires Rights
Entitlements or the Rights Equity Shares will be deemed to have declared, warranted and agreed, by accepting
the delivery of the Letter of Offer/the Abridged Letter of Offer and the CAFs, that it is not and that at the time of
subscribing for the Equity Shares or the Rights Entitlements, it will not be, in the United States and in other
restricted jurisdictions.
Persons who may acquire Rights Entitlements or come into possession of the Letter of Offer or Abridged Letter
of Offer or CAF are advised to consult their own legal advisors as to restrictions applicable to them and to
observe such restrictions. The Letter of Offer may not be used for the purpose of an offer or invitation in any
circumstances in which such offer or invitation is not authorized. No action has been or will be taken that would
permit the offering of the Equity Shares or Rights Entitlements pursuant to the Issue to occur in any jurisdiction
other than India, or the possession, circulation or distribution of the Letter of Offer or CAF in any jurisdiction
where action for such purpose is required. Accordingly, the Equity Shares may not be offered or sold, directly or
indirectly, and the Letter of Offer, the Abridged Letter of Offer or CAF may not be distributed or published in or
from any jurisdiction except under circumstances that will result in compliance with applicable law and
procedures of and in any such jurisdiction. Recipients of the Letter of Offer, the Abridged Letter of Offer or the
CAF, including Eligible Equity Shareholders and Renouncees, are advised to consult their legal counsel prior to
applying for the Rights Entitlement and additional Equity Shares or accepting any provisional allotment of
Equity Shares, or making any offer, sale, resale, pledge or other transfer of the Equity Shares or Rights
Entitlement.
For Eligible Equity Shareholders wishing to apply through the ASBA process for the Issue, kindly refer section
titled “Procedure for Application through the Applications Supported by Blocked Amount (“ASBA”) Process”
on page 185 of the Letter of Offer.
PRINCIPAL TERMS OF THE EQUITY SHARES ISSUED UNDER THIS ISSUE
Face Value
Each Equity Share will have the face value of ` 10.
Issue Price
Each Equity Share shall be offered at an Issue Price of ` 201 for cash at a premium of ` 191 per Equity Share.
The Issue Price has been arrived at by us in consultation with Inga Capital Private Limited, Lead Manager.
Rights Entitlement Ratio
The Rights Equity Shares are being offered on a rights basis to the Eligible Equity Shareholders in the ratio of 2
Equity Shares for every 7 Equity Shares held on the Record Date.
Terms of Payment
The full amount of Issue Price is payable on application.
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Fractional Entitlements
The Right Equity Shares are being offered on a rights basis to the existing Equity Shareholders in the ratio of 2
Equity Shares for every 7 Equity Shares held as on the Record Date. For Equity Shares being offered on a rights
basis under this Issue, if the shareholding of any of the Equity Shareholders is less than 7 Equity Shares or is not
in a multiple of 7 Equity Shares, the fractional entitlement of such Equity Shareholders shall be ignored for
computation of the Rights Entitlement. However, Equity Shareholders whose fractional entitlements are being
ignored will be given preference in the allotment of one additional Equity Share each, if such Equity
Shareholders have applied for additional Equity Shares over and above their Rights Entitlement.
Also, those Equity Shareholders holding less than 4 Equity Shares and therefore entitled to ‘Zero’ Equity Shares
under this Issue shall be despatched a CAF with ‘Zero’ entitlement. Such Equity Shareholders are entitled to
apply for additional Equity Shares and would be given preference in the allotment of one additional Rights
Equity Share if, such Equity Shareholders have applied for the additional Equity Shares. However, they cannot
renounce the same to third parties. CAFs with zero entitlement shall be non-negotiable/ non – renounceable.
Ranking
The Equity Shares being issued shall be subject to the provisions of our Memorandum of Association and
Articles of Association. The Equity Shares issued under this Issue shall rank pari passu, in all respects including
dividend, with our existing Equity Shares, provided that voting rights and dividend payable shall be in
proportion to the paid-up value of Equity Shares held. In terms of Article 98 of the Articles of Association,
money paid in advance of calls shall not confer a right to dividend or participation in profits of our Company.
Mode of payment of dividend
In the event of declaration of dividend, we shall pay dividend to Equity Shareholders as per the provisions of the
Companies Act and the provisions of our Articles of Association.
Listing and trading of Equity Shares proposed to be issued
Our existing Equity Shares are currently listed and traded on BSE (Scrip Code: 522263) and the NSE (Scrip
Code: JMCPROJECT) under the ISIN –INE890A01016.
The listing and trading of the Equity Shares issued pursuant to the Issue shall be based on the current regulatory
framework applicable thereto. Accordingly, any change in the regulatory regime would affect the schedule.
Upon Allotment, the Equity Shares shall be traded on Stock Exchanges in the demat segment only.
We have made an application for “in-principle” approval for listing of the Equity Shares to the BSE and the
NSE and have received such approval from the BSE and the NSE pursuant to the letter numbers
DCS/PREF/KS-RT/476/2015-16 and NSE/LIST/45655, dated October 23, 2015 and October 08, 2015,
respectively. We will apply to the BSE and the NSE for final approval for the listing and trading of the Equity
Shares. No assurance can be given regarding the active or sustained trading in the Equity Shares or that the price
at which the Equity Shares offered under the Issue will trade after listing on the Stock Exchanges. All steps for
the completion of the necessary formalities for listing and commencement of trading of the Equity Shares to be
allotted pursuant to the Issue shall be taken as soon as possible from the finalisation of the basis of allotment but
not later than 7 working days of finalization of basis of allotment. The Equity Shares proposed to be issued on a
rights basis shall be listed and admitted for trading on the BSE and the NSE under the existing ISIN for Equity
Shares.
Rights of the equity shareholder
Subject to applicable laws, the equity shareholders shall have the following rights:
Right to receive dividend, if declared;
Right to attend general meetings and exercise voting powers, unless prohibited by law;
Right to vote in person or by proxy;
Right to receive offers for rights shares and be allotted bonus shares, if announced;
Right to receive surplus on liquidation;
Right to free transferability of Equity Shares; and
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Such other rights as may be available to a shareholder of a listed public company under the Companies
Act andthe Memorandum of Association and Articles of Association.
General Terms of the Issue
Market Lot
The Equity Shares of our Company are tradable only in dematerialized form. The market lot for the Equity
Shares in dematerialised mode is one. In case an Equity Shareholder holds Equity Shares in physical form, we
would issue to the allottees one certificate for the Equity Shares allotted to each folio (“Consolidated
Certificate”). In respect of Consolidated Certificates, we will upon receipt of a request from the respective
Equity Shareholders, split such Consolidated Certificates into smaller denominations within one week’s time
from the receipt of the request in respect thereof. We shall not charge a fee for splitting any of the Consolidated
Certificates.
Joint Holders
Where two or more persons are registered as the holders of any Equity Shares, they shall be deemed to hold the
same as joint tenants with the benefit of survivorship subject to the provisions contained in the Articles of
Association.
Nomination
In terms of Section 72 of the Companies Act, 2013 read with Rule 19 of the Companies (Share Capital and
Debentures) Rules, 2014, nomination facility is available in respect of the Equity Shares. An Investor can
nominate any person by filling the relevant details in the CAF in the space provided for this purpose.
In case of Equity Shareholders who are individuals, a sole Equity Shareholder or the first named Equity
Shareholder, along with other joint Equity Shareholders, if any, may nominate any person(s) who, in the event
of the death of the sole holder or all the joint-holders, as the case may be, shall become entitled to the Equity
Shares. A person, being a nominee, becoming entitled to the Equity Shares by reason of the death of the original
Equity Shareholder(s), shall be entitled to the same advantages to which he would be entitled if he were the
registered holder of the Equity Shares. Where the nominee is a minor, the Equity Shareholder(s) may also make
a nomination to appoint, in the prescribed manner, any person to become entitled to the Equity Share(s), in the
event of death of the said holder, during the minority of the nominee. A nomination shall stand rescinded upon
the sale of the Equity Shares by the person nominating. A transferee will be entitled to make a fresh nomination
in the manner prescribed. Fresh nominations can be made only in the prescribed form available on request at our
Registered Office or such other person at such addresses as may be notified by us. The Investor can make the
nomination by filling in the relevant portion of the CAF.
In terms of Section 72 of the Companies Act, 2013 any person who becomes a nominee by virtue of the
provisions of Section 72 of the Companies Act, 2013 shall upon the production of such evidence as may be
required by the Board, elect either:
to register himself or herself as the holder of the Equity Shares; or
to make such transfer of the Equity Shares, as the deceased holder could have made.
Further, the Board may at any time give notice requiring any nominee to choose either to be registered himself
or herself or to transfer the Equity Shares, and if the notice is not complied with within a period of ninety days,
the Board may thereafter withhold payment of all dividends, bonuses or other moneys payable in respect of the
Equity Shares, until the requirements of the notice have been complied with.
Only one nomination would be applicable for one folio. Hence, in case the Equity Shareholder(s) has already
registered the nomination with us, no further nomination needs to be made for Equity Shares that may be
allotted in this Issue under the same folio.
In case the allotment of Equity Shares is in dematerialised form, there is no need to make a separate nomination
for the Equity Shares to be allotted in this Issue. Nominations registered with respective Depositary Participant
(“DP”) of the investor would prevail. Any investor desirous of changing the existing nomination is requested to
inform their respective DP.
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Offer to Non Resident Eligible Equity Shareholders/ Investors
Applications received from NRs for Equity Shares under the Issue shall be inter alia, subject to the conditions
laid down in the RBI approval and the conditions imposed from time to time by the RBI under FEMA, including
the regulations relating to QFIs, in the matter of receipt and refund of Application Money, Allotment, issue of
letters of Allotment/ allotment advice/ share certificates, payment of interest and dividends. General permission
has been granted to any person resident outside India to purchase shares offered on a rights basis by an Indian
company in terms of FEMA and Regulation 6 of notification No. FEMA 20/2000-RB dated May 3, 2000. The
Abridged Letter of Offer and CAF shall be dispatched to non-resident Eligible Equity Shareholders at their
Indian address only. If an NR or NRI Investors has specific approval from RBI, in connection with his
shareholding, he should enclose a copy of such approval with the Application Form.
Our Board of Directors may, at its absolute discretion, agree to such terms and conditions as may be stipulated
by RBI while approving the Issue. The Equity Shares purchased on a rights basis by Non-Residents shall be
subject to the same conditions including restrictions in regard to the repatriability as are applicable to the
original equity shares against which equity shares are issued on a right basis.
CAFs will be made available for eligible NRIs at our Registered Office and with the Registrar to the Issue.
In case of change of status of holders i.e. from Resident to Non-Resident, a new demat account must be opened.
DETAILS OF SEPARATE COLLECTING CENTRES FOR NON-RESIDENT APPLICATIONS SHALL BE
PRINTED ON THE CAF.
Notices
All notices to the Equity Shareholder(s) required to be given by us shall be published in one English national
daily with wide circulation, one Hindi national daily with wide circulation and one regional language daily
newspaper with wide circulation in the state where our registered office is located and/ or will be sent by
ordinary post/ registered post/ speed post to the registered address of the Equity Shareholders in India or the
Indian address provided by the Equity Shareholders, from time to time. However, the distribution of the Letter
of Offer / Abridged Letter of Offer and the issue of Equity Shares on a rights basis to persons in certain
jurisdictions outside India may be restricted by legal requirements prevailing in those jurisdictions.
Subscription by the Promoter
Our Promoter through its letter dated September 23, 2015 has confirmed (on behalf of itself and other members
of promoter group), that, it, either through itself or through other member(s) of promoter group, intend to
subscribe to their Rights Entitlement in full in the Issue, in compliance with regulation 10(4) of Takeover
Regulations. In addition to subscription to their Rights Entitlements, the Promoter has also confirmed that it,
either through itself or through other member(s) of promoter group, also intend to (i) subscribe to additional
Equity Shares, and (ii) subscribe for unsubscribed portion in the Issue, if any. Such subscription to additional
Equity Shares and the unsubscribed portion, if any, shall be in accordance with regulation 10(4) of Takeover
Regulations subject to their total shareholding not exceeding 75% of the issued, outstanding and fully paid up
Equity Share capital in accordance with the provisions of the Equity Listing Agreement.
Such subscription for Equity Shares over and above their Rights Entitlement, if allotted, may result in an
increase in their percentage shareholding. Any such acquisition of additional Equity Shares of the Company
shall not result in a change of control of the management of the Company in accordance with provisions of the
Takeover Regulations and shall be exempt in terms of Regulation 10 (4) (a) and (b) of the Takeover
Regulations.
Presently our Company is complying with Regulation 38 of the SEBI Listing Regulations read with Rule 19A of
the Securities Contracts (Regulation) Rules, 1957, in connection with the requirement of maintaining the
minimum public shareholding, i.e. at least 25% of the total paid up equity capital is held by public, for
continuous listing.
For details, please see section titled “Terms of the Issue” on page 167 of the Letter of Offer.
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Procedure for Application
The CAF for Rights Equity Shares offered as a part of the Issue would be printed in black ink for all Eligible
Equity Shareholders. The CAF along with the Abridged Letter of Offer shall be dispatched through registered
post or speed post at least three days before the Issue Opening Date. In case the original CAFs are not received
by the Eligible Equity Shareholders or is misplaced by them, they may request the Registrar to the Issue, for
issue of a duplicate CAF, by furnishing the registered folio number, DP ID, Client ID and their full name and
address. In case the signature of the Eligible Equity Shareholder(s) does not match with the specimen registered
with us, the application is liable to be rejected.
Please note that neither the Company, nor the Lead Manager nor the Registrar shall be responsible for delay in
the receipt of the CAF/ duplicate CAF attributable to postal delays or if the CAF/ duplicate CAF are misplaced
in the transit.
Please note that in accordance with the provisions of SEBI circular bearing number
CIR/CFD/DIL/1/2011 dated April 29, 2011, all Applicants who are QIBs or Non Institutional Investors
must mandatorily make use of ASBA facility.
All QIB applicants, Non-Institutional Investors and other applicants whose application amount exceeds `
200,000 can participate in the Issue only through the ASBA process, subject to their fulfilling the eligibility
conditions to be an ASBA Investor. Further all QIB applicants and Non-Institutional Investors are mandatorily
required to use ASBA, even if application amount does not exceed ` 200,000, subject to their fulfilling the
eligibility conditions to be an ASBA Investor. The Investors who are (i) not QIBs, (ii) not Non-Institutional
Investors or (iii) investors whose application amount is less than ` 200,000 can participate in the Issue either
through the ASBA process or the non ASBA process.
Please also note that by virtue of the Circular No. 14 dated September 16, 2003 issued by the RBI, Overseas
Corporate Bodies (“OCBs”) have been derecognized as an eligible class of investors and the RBI has
subsequently issued the Foreign Exchange Management (Withdrawal of General Permission to Overseas
Corporate Bodies (OCBs)) Regulations, 2003. Any Equity Shareholder being an OCB is required to obtain prior
approval from RBI for applying in this Issue.
The CAF consists of four parts:
Part A: Form for accepting the Equity Shares offered as a part of this Issue, in full or in part, and for
applying for additional Equity Shares;
Part B: Form for renunciation of Equity Shares;
Part C: Form for application of Equity Shares by Renouncee(s);
Part D: Form for request for split Application forms.
Options available to the Equity Shareholders
The CAFs will clearly indicate the number of Equity Shares that Equity Shareholder is entitled to. An Eligible
Equity Shareholder can:
Apply for his Rights Entitlement of Equity Shares in full;
Apply for his Rights Entitlement of Equity Shares in part (without renouncing the other part);
Apply for his Rights Entitlement of Equity Shares in part and renounce the other part of the Equity Shares;
Apply for his Rights Entitlement in full and apply for additional Equity Shares;
Renounce his Rights Entitlement in full.
Acceptance of the Issue
You may accept the offer to participate and apply for the Equity Shares, either in full or in part without
renouncing the balance by filling Part A of the CAFs and submit the same along with the application money
payable to the collection branches of the Banker to the Issue as mentioned on the reverse of the CAFs before the
close of the banking hours on or before the Issue Closing Date or such extended time as may be specified by the
Board of Directors in this regard. Investors at centres not covered by the branches of the Banker to the Issue can
send their CAFs together with the cheque drawn at par on a local bank at Mumbai/ demand draft payable at
Mumbai to the Registrar to the Issue by registered post / speed post so as to reach the Registrar to the Issue prior
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to the Issue Closing Date. Please note that neither the Company nor the Lead Manager nor the Registrar to the
Issue shall be responsible for delay in the receipt of the CAF attributable to postal delays or if the CAF is
misplaced in transit. Such applications sent to anyone other than the Registrar to the Issue are liable to be
rejected. For further details on the mode of payment, please see the headings “Mode of Payment for Resident
Equity Shareholders/ Investors” and “Mode of Payment for Non-Resident Equity Shareholders/ Investors” on
page 178 and page 179 of the Letter of Offer, respectively.
Additional Equity Shares
You are eligible to apply for additional Equity Shares over and above your Rights Entitlement, provided that
you are eligible to apply under applicable law and have applied for all the Rights Equity Shares offered without
renouncing them in whole or in part in favour of any other person(s). Applications for additional Rights Equity
Shares shall be considered and allotment shall be made at the sole discretion of the Board, subject to sectoral
caps and in consultation if necessary with the Designated Stock Exchange and in the manner prescribed under
“Terms of the Issue” on page 167 of the Letter of Offer.
If you desire to apply for additional Equity Shares, please indicate your requirement in the place provided for
additional Equity Shares in Part A of the CAF. The Renouncees applying for all the Equity Shares renounced in
their favour may also apply for additional Equity Shares.
Where the number of additional Equity Shares applied for exceeds the total number of Equity Shares available
for Allotment, the Allotment would be made on a fair and equitable basis in consultation with the Designated
Stock Exchange.
Renunciation
This Issue includes a right exercisable by you to renounce the Equity Shares offered to you either in full or in
part in favour of any other person or persons. Your attention is drawn to the fact that we shall not Allot and/ or
register the Equity Shares in favour of more than three persons (including joint holders), partnership firm(s)
(partners of the partnership firm are eligible for allotment of Rights Equity Shares if they have applied for the
same in their individual capacity as partners of such firm ) or their nominee(s), minors other than who have a
valid beneficiary account, as per demographic details provided by Depositaries, HUF(kartas of a HUF are
eligible for allotment of Rights Equity Shares if they have applied for the same on behalf of or for the benefit of
the HUF), any trust or society (unless the same is registered under the Societies Registration Act, 1860 or the
Indian Trust Act, 1882 or any other applicable law relating to societies or trusts and is authorized under its
constitution or bye-laws to hold Equity Shares, as the case may be). Additionally, existing Equity Shareholders
may not renounce in favour of persons or entities in the United States, or to, or for the account or benefit of a
“U.S. Person” (as defined in Regulation S), or who would otherwise be prohibited from being offered or
subscribing for Equity Shares or Rights Entitlement under applicable securities laws.
Any renunciation other than as stated above is subject to the renouncer(s)/renouncee(s) obtaining the approval of
the FIPB and/or necessary permission of the RBI under the FEMA and such permissions should be attached to
the CAF or SAF. In case of Applications which are not accompanied by the aforesaid approvals, our Board
reserves the right to reject such CAF or SAF.
RBI has vide its letter dated January 7, 2016 has conveyed no-objection to the renunciation of rights entitlement
in the Issue, by the following:
i. by resident to non-resident (NR), which is akin to transfer by way of sale. The offer price to NR should
not be less than that at which the offer is made to a resident shareholder in terms of Regulation 6 of
Notification No. FEMA.20 /2000-RB dated 3rd May 2000 as amended from time to time. Further the
renunciation of rights entitlement should be on the floor of the Stock Exchange.
ii. by non-resident to resident on the floor of the Stock Exchange.
iii. by non-resident to non-resident on the floor of the Stock Exchange. However the offer price to NR should
not be less than that at which offer is made to resident shareholder. If the non-resident transferees include
FIIs, the individual as well as overall limit should be complied with.
The above approval if subject to following conditions:
i. If any transaction involves an erstwhile OCB, the Bank should approach RBI with full details for prior
approval.
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ii. The NRI shareholders holding non-repatriable shares may renounce the rights entitlement in favour of
Residents or other NRIs only;
iii. The Company may comply with all the documentation and reporting requirements.
Only the existing non-resident shareholders may subscribe for additional equity shares over and above the
equity shares offered in the Issue in terms of the Regulation 6 of FEMA Notification 20/2000-RB dated 3rd
May,
2000 as amended from time to time.
Renunciations by Overseas Corporate Bodies
By virtue of the Circular No. 14 dated September 16, 2003 issued by the RBI, Overseas Corporate Bodies
(“OCBs”) have been derecognized as an eligible class of investors and the RBI has subsequently issued the
Foreign Exchange Management (Withdrawal of General Permission to Overseas Corporate Bodies (OCBs))
Regulations, 2003. Accordingly, the existing Equity Shareholders who do not wish to subscribe to the Equity
Shares being offered but wish to renounce the same in favour of Renouncee shall not renounce the same
(whether for consideration or otherwise) in favour of OCB(s).
The RBI has however clarified in its circular, A.P. (DIR Series) Circular No. 44, dated December 8, 2003 that
OCBs which are incorporated and are not under the adverse notice of the RBI are permitted to undertake fresh
investments as incorporated non-resident entities in terms of Regulation 5(1) of RBI Notification No.20/ 2000-
RB dated May 3, 2000 under FDI Scheme with the prior approval of Government if the investment is through
Government Route and with the prior approval of RBI if the investment is through Automatic Route on case by
case basis. Shareholders renouncing their rights in favour of OCBs may do so provided such Renouncee obtains
a prior approval from the RBI. On submission of such approval to us at our Registered Office, the OCB shall
receive the Abridged Letter of Offer and the CAF.
Part ‘A’ of the CAF must not be used by any person(s) other than those in whose favour this offer has been
made. If used, this will render the application invalid. Submission of the CAF to the Banker to the Issue at its
collecting branches specified on the reverse of the CAF with the form of renunciation (Part ‘B’ of the CAF) duly
filled in shall be conclusive evidence for us of the fact of renouncement to the person(s) applying for Equity
Shares in Part ‘C’ of the CAF for the purposes of Allotment of such Equity Shares. The Renouncees applying
for all the Equity Shares renounced in their favour may also apply for additional Equity Shares. Part ‘A’ of the
CAF must not be used by the Renouncee(s) as this will render the application invalid. Renouncee(s) will have
no further right to renounce any Equity Shares in favour of any other person.
Procedure for renunciation
To renounce all the Equity Shares offered to an Equity Shareholder in favour of one Renouncee
If you wish to renounce the offer indicated in Part ‘A’, in whole, please complete Part ‘B’ of the CAF. In case of
joint holding, all joint holders must sign Part ‘B’ of the CAF. The person in whose favour renunciation has been
made should complete and sign Part ‘C’ of the CAF. In case of joint Renouncees, all joint Renouncees must sign
Part ‘C’ of the CAF.
To renounce in part/ or renounce the whole to more than one person(s)
If you wish to either accept this offer in part and renounce the balance or renounce the entire offer under this
Issue in favour of two or more Renouncees, the CAF must be first split into requisite number of SAFs. Please
indicate your requirement of SAFs in the space provided for this purpose in Part ‘D’ of the CAF and return the
entire CAF to the Registrar to the Issue so as to reach them latest by the close of business hours on the last date
of receiving requests for SAFs. On receipt of the required number of SAFs from the Registrar, the procedure as
mentioned in paragraph above shall have to be followed.
In case the signature of the Equity Shareholder(s), who has renounced the Equity Shares, does not match with
the specimen registered with us/ Depositories, the application is liable to be rejected.
Renouncee(s)
The person(s) in whose favour the Equity Shares are renounced should fill in and sign Part ‘C’ of the CAF and
submit the entire CAF to any of the collection branches of the Banker to the Issue as mentioned in the reverse of
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the CAF on or before the Issue Closing Date along with the application money in full. The Renouncee cannot
further renounce.
Change and/ or introduction of additional holders
If you wish to apply for the Equity Shares jointly with any other person(s), not more than three (including you),
who is/ are not already a joint holder with you, it shall amount to renunciation and the procedure as stated above
for renunciation shall have to be followed. Even a change in the sequence of the name of joint holders shall
amount to renunciation and the procedure, as stated above shall have to be followed.
However, this right of renunciation is subject to the express condition that the Board of Directors shall be
entitled in its absolute discretion to reject the request for Allotment from the Renouncee(s) without assigning
any reason thereof. All such applications will be treated as applications from Renouncees and shall have to be
made through the non- ASBA process only to be considered valid for allotment. Please also see section titled
“Terms of the Issue” on page 167 of the Letter of Offer.
APPLICATIONS FOR NON-ASBA INVESTORS
Eligible Equity Shareholders who are eligible to apply under the Non – ASBA process
The option of applying for Equity Shares through non – ASBA process is available only to Eligible Equity
Shareholders of our Company on the Record Date as well as Renouncees whose application not exceed `
2,00,000. All Applicants who are QIBs and Non – Institutional Investors can apply in the Issue only
through the ASBA process.
Instructions for Options for Non-ASBA Investors
The summary of options available to the Eligible Equity Shareholder is presented below. You may exercise any
of the following options with regard to the Rights Equity Shares offered, using the CAF:
Sr. No Option Available Action Required
(i) Accept whole or part of your Rights
Entitlement without renouncing the
balance.
Fill in and sign Part A (All joint holders must sign in the
same sequence)
(ii) Accept your Rights Entitlement in
full and apply for additional Rights
Equity Shares
Fill in and sign Part A including Block III relating to the
acceptance of entitlement and Block IV relating to
additional Equity Shares (All joint holders must sign in the
same sequence)
(iii) Accept a part of your Rights
Entitlement and renounce the
balance to one or more
Renouncee(s)
OR
Renounce your Rights Entitlement
of all the Rights Equity Shares
offered to you to more than one
Renouncee
Fill in and sign Part D (all joint holders must sign in the
same sequence) requesting for SAFs. Send the CAF to the
Registrar to the Issue so as to reach them on or before the
last date for receiving requests for SAFs. Splitting will be
permitted only once.
On receipt of the SAF take action as indicated below.
For the Equity Shares you wish to accept, if any, fill in and
sign Part A.
For the Rights Equity Shares you wish to renounce, fill in
and sign Part B indicating the number of Equity Shares
renounced and hand it over to the Renouncee. Each of the
Renouncee should fill in and sign Part C for the Equity
Shares accepted by them.
(iv) Renounce your Rights Entitlement
in full to one person (Joint
Renouncees are considered as one)
Fill in and sign Part B (all joint holders must sign in the
same sequence) indicating the number of Equity Shares
renounced and hand it over to the Renouncee. The
Renouncee must fill in and sign Part C (All joint
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Sr. No Option Available Action Required
Renouncees must sign)
(v) Introduce a joint holder or change
the sequence of joint holders
This will be treated as a renunciation. Fill in and sign Part
B and the Renouncee must fill in and sign Part C.
In case of Equity Shares held in physical form, applicants must provide information in the CAF as to
their respective bank account numbers, name of the bank, to enable the Registrar to print the said details
on the refund order. Failure to comply with this may lead to rejection of application. In case of Equity
Shares held in dematform, bank account details furnished by the Depositories will be printed on the
refund order.
Please note that:
Options iii-iv will not be available for Equity Shareholders applying through ASBA process.
Part ‘A’ of the CAF must not be used by any person(s) other than the Eligible Equity Shareholder to whom
the Letter of Offer has been addressed. If used, this will render the application invalid.
Request for SAF should be made for a minimum of one Equity Share or, in either case, in multiples thereof,
and one SAF for the balance Equity Shares, if any.
Request by the Equity Shareholder for the SAFs should reach the Registrar on or before last date for
receiving request for SAF(s).
Only the Equity Shareholder to whom the Letter of Offer has been addressed shall be entitled to renounce
and to apply for SAFs. Forms once split cannot be split further.
SAFs will be sent to the Equity Shareholder(s) by post at the applicant’s sole risk.
Equity Shareholders may not renounce in favour of persons or entities in the restricted jurisdictions
including the United States or to or for the account or benefit of a “U.S. Person” (as defined in Regulation
S), or who would otherwise be prohibited from being offered or subscribing for Equity Shares or Rights
Entitlement under applicable securities laws.
Submission of the CAF to the Banker to the Issue at its collecting branches specified on the reverse of the
CAF with the form of renunciation (Part ‘B’ of the CAF) duly filled in shall be conclusive evidence for us
of the person(s) applying for Equity Shares in Part ‘C’ of the CAF to receive Allotment of such Equity
Shares.
While applying for or renouncing their Rights Entitlement, joint Equity Shareholders must sign the CAF in
the same order as per specimen signatures recorded with us or the Depositories.
Non-resident Equity Shareholders: Application(s) received from Non-Resident/ NRIs, or persons of Indian
origin residing abroad for allotment of Equity Shares allotted as a part of this Issue shall, inter alia, be
subject to conditions, as may be imposed from time to time by the RBI under FEMA in the matter of refund
of application money, allotment of Equity Shares, subsequent issue and allotment of Equity Shares, interest,
export of share certificates, etc. In case a Non-Resident or NRI Eligible Equity Shareholder has specific
approval from the RBI, in connection with his shareholding, he should enclose a copy of such approval with
the CAF.
Applicants must write their CAF number at the back of the cheque / demand draft.
The RBI has mandated that CTS 2010 standard non-compliant cheques can be presented in clearing only in
reduced frequency, specifically once a week, on Mondays of every week from November 2014 onwards.
This would have an impact on timelines for the issuance of final certificates, hence the CAFs accompanied
with non-CTS cheques could get rejected.
Availability of duplicate CAF
In case the original CAF is not received, or is misplaced by the Equity Shareholder, the Registrar to the Issue
will issue a duplicate CAF on the request of the Eligible Equity Shareholder who should furnish the registered
folio number/ DP and Client ID number and his/ her full name and address to the Registrar to the Issue. Please
note that the request for duplicate CAF should reach the Registrar to the Issue at least 7 days prior to the Issue
Closing Date. Please note that those who are making the application in the duplicate form should not utilize the
original CAF for any purpose including renunciation, even if it is received/ found subsequently. If the Eligible
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Equity Shareholder violates such requirements, he/ she shall face the risk of rejection of either original CAF or
both the applications.
Neither the Registrar nor the Lead Manager or our Company, shall be responsible for postal delays or loss of
duplicate CAFs in transit, if any.
Application on Plain Paper
An Equity Shareholder who has neither received the original CAF nor is in a position to obtain the duplicate
CAF may make an application to subscribe to the Issue on plain paper, along with account payee cheque/pay
order drawn on a bank in Mumbai/ demand draft (after deducting banking and postal charges) payable at
Mumbai which should be drawn in favour of “JMC Projects (India) Limited – Rights Issue - R” in case of
resident shareholders applying on non-repatriable basis and in favour of “JMC Projects (India) Limited –
Rights Issue – NR” in case of non-resident shareholders applying on repatriable basis and send the same by
registered post directly to the Registrar to the Issue so as to reach Registrar to the Issue on or before the Issue
Closing Date. The envelope should be superscribed JMC Projects (India) Limited – Rights Issue - R” in case of
resident shareholders and Non-resident shareholders applying on non-repatriable basis, and “JMC Projects
(India) Limited – Rights Issue – NR” in case of non-resident shareholders applying on repatriable basis.
The application on plain paper, duly signed by the applicant(s) including joint holders, in the same order as per
specimen recorded with us or the Depositories, must reach the office of the Registrar to the Issue before the
Issue Closing Date and should contain the following particulars:
Name of Issuer, being JMC Projects (India) Ltd. Limited ;
Name and address of the Equity Shareholder including joint holders;
Registered Folio Number/ DP and Client ID no.;
Number of Equity Shares held as on Record Date;
Number of Equity Shares entitled to;
Number of Equity Shares applied for;
Number of additional Equity Shares applied for, if any;
Total number of Equity Shares applied for;
Total amount paid at the rate of ` 201 per Equity Share;
Particulars of cheque/ demand draft;
Savings/ Current Account Number and name and address of the bank where the Equity Shareholder will be
depositing the refund order. In case of Equity Shares allotted in demat form, the bank account details will
be obtained from the information available with the Depositories;
Except for applications on behalf of the Central or State Government, the residents of Sikkim and the
officials appointed by the courts, PAN of the Eligible Equity Shareholder and for each Eligible Equity
Shareholder in case of joint names, irrespective of the total value of the Equity Shares applied for pursuant
to the Issue; Documentary evidence for exemption to be provided by the applicants;
Share certificate numbers and distinctive numbers of Equity Shares, if held in physical form;
Allotment option preferred - physical or demat form, if held in physical form (Rights Equity Shares will be
allotted in physical form only if the Equity Shares held on the Record Date i.e. January 12, 2016 are in the
physical form);
If the payment is made by a draft purchased from NRE/ FCNR/ NRO account, as the case may be, an
account debit certificate from the bank issuing the draft confirming that the draft has been issued by
debiting the NRE/ FCNR/ NRO account;
Signature of the Equity Shareholders to appear in the same sequence and order as they appear in our records
/ Depositories; and
For ASBA Investors, application on plain paper should have details of their ASBA Account.
Additionally, all such applicants are deemed to have accepted the following:
“I/ We understand that neither the Rights Entitlement nor the Equity Shares have been, and will be, registered
under the United States Securities Act of 1933 (the “US Securities Act”) or any United States state securities
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laws, and may not be offered, sold, resold or otherwise transferred within the United States or to the territories
or possessions thereof (the “United States”) or to, or for the account or benefit of a “U.S. Person” as defined in
Regulation S of the US Securities Act (“Regulation S”). I/ we understand the Equity Shares referred to in this
application are being offered in India but not in the United States. I/ we understand the offering to which this
application relates is not, and under no circumstances is to be construed as, an offering of any Equity Shares or
Rights Entitlement for sale in the United States, or as a solicitation therein of an offer to buy any of the said
Equity Shares or Rights Entitlement in the United States. Accordingly, I/ we understand this application should
not be forwarded to or transmitted in or to the United States at any time. I/ we understand that neither us, nor
the Registrar, the Lead Manager or any other person acting on behalf of us will accept subscriptions from any
person, or the agent of any person, who appears to be, or who we, the Registrar, the Lead Manager or any other
person acting on behalf of us have reason to believe is, a resident of the United States or a “U.S. Person” (as
defined in Regulation S) or is ineligible to participate in the Issue under the securities laws of their jurisdiction.
I/ We will not offer, sell or otherwise transfer any of the Equity Shares which may be acquired by us in any
jurisdiction or under any circumstances in which such offer or sale is not authorized or to any person to whom
it is unlawful to make such offer, sale or invitation except under circumstances that will result in compliance
with any applicable laws or regulations. We satisfy, and each account for which we are acting satisfies, all
suitability standards for investors in investments of the type subscribed for herein imposed by the jurisdiction of
our residence.
I/ We understand and agree that the Rights Entitlement and Equity Shares may not be reoffered, resold, pledged
or otherwise transferred except in an offshore transaction in compliance with Regulation S, or otherwise
pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US
Securities Act.
I/ We (i) am/ are, and the person, if any, for whose account I/ we am/ are acquiring such Rights Entitlement
and/ or the Equity Shares is/ are, outside the United States, (ii) am/ are not a “U.S. Person” as defined in
Regulation S, and (iii) am / are acquiring the Rights Entitlement and/ or the Equity Shares in an offshore
transaction meeting the requirements of Regulation S.
I/ We acknowledge that we, the Lead Manager, their affiliates and others will rely upon the truth and accuracy
of the foregoing representations and agreements.”
Please note that those who are making the application otherwise than on original CAF shall not be entitled to
renounce their rights and should not utilize the original CAF for any purpose including renunciation even if it is
received subsequently. If the Eligible Equity Shareholder violates such requirements, he/ she shall face the risk
of rejection of both the applications. We shall refund such application amount to the Eligible Equity Shareholder
without any interest thereon and no liability shall arise on part of our Company, Lead Manager and its Directors.
Investors are requested to strictly adhere to these instructions. Failure to do so could result in an application
being rejected, with our Company, the Lead Manager and the Registrar not having any liability to the Investor.
Last date for Application
The last date for submission of the duly filled in CAF is February 5, 2016. The Board of Directors may extend
the said date for such period as it may determine from time to time, subject to the Issue Period not exceeding 30
days from the Issue Opening Date,
If the CAF together with the amount payable is not received by the Banker to the Issue/ Registrar to the Issue on
or before the close of banking hours on the aforesaid last date or such date as may be extended by the Board or
any authorised committee thereof, the invitation to offer contained in the Letter of Offer shall be deemed to have
been declined and the Board or any authorised committee thereof shall be at liberty to dispose of the Equity
Shares hereby offered, as provided under section titled “Terms of the Issue” on page 167 of the Letter of Offer.
Mode of payment for Resident Equity Shareholders/ Investors
All cheques/ drafts accompanying the CAF should be drawn in favour of “JMC Projects (India) Limited
– Rights Issue - R” crossed ‘A/c Payee only’ ;
Investors residing at places other than places where the bank collection centres have been opened by us for
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collecting applications, are requested to send their CAFs together with Demand Draft for the full
application amount, net of bank and postal charges favouring the Banker to the Issue, crossed ‘A/c Payee
only’ and marked “JMC Projects (India) Limited – Rights Issue - R” payable at Mumbai directly to the
Registrar to the Issue by registered post so as to reach them on or before the Issue Closing Date. We, the
Lead Manager or the Registrar to the Issue will not be responsible for postal delays or loss of applications
in transit, if any.
Applications through mails should not be sent in any other manner except as mentioned above. The CAF along
with the application money must not be sent to our Company or the Lead Manager. Applicants are requested to
strictly adhere to these instructions.
Mode of payment for Non-Resident Equity Shareholders/ Investors
As regards the application by non-resident Equity Shareholders/ Investors, the following conditions shall
apply:
Individual non-resident Indian applicants who are permitted to subscribe for Equity Shares by applicable
local securities laws can also obtain application forms from the following address:
Link Intime India Private Limited
C-13, Pannalal Silk Mills Compound
L.B.S. Marg
Bhandup (West), Mumbai - 400 078
Maharashtra, India
Tel No.: +91 22 61715400
Fax No.: +91 22 2596 0329
Email: [email protected]
Investor Grievance E-mail: [email protected]
Website: www.linkintime.co.in
Contact Person: Mr. Dinesh Yadav
Note: The Letter of Offer/ Abridged Letter of Offer and CAFs to NRIs shall be sent only to their Indian
address, if provided.
Applications will not be accepted from non-resident from any jurisdiction where the offer or sale of the
Rights Entitlements and Equity Shares may be restricted by applicable securities laws.
All non-resident investors should draw the cheques/ demand drafts for the full application amount, net of
bank and postal charges and which should be submitted along with the CAF to the Banker to the Issue/
collection centres or to the Registrar to the Issue.
Non-resident investors applying from places other than places where the bank collection centres have been
opened by the Company for collecting applications, are requested to send their CAFs together with Demand
Draft for the full application amount, net of bank and postal charges, and marked “JMC Projects (India)
Limited – Rights Issue - R” payable at Mumbai directly to the Registrar to the Issue by registered post so as
to reach them on or before the Issue Closing Date. The Company or the Registrar to the Issue will not be
responsible for postal delays or loss of applications in transit, if any.
Payment by non-residents must be made by demand draft payable at Mumbai / cheque payable drawn on a
bank account maintained at Mumbai or funds remitted from abroad in any of the following ways:
Application with repatriation benefits
(i) By Indian Rupee drafts purchased from abroad and payable at Mumbai or funds remitted from abroad
(submitted along with Foreign Inward Remittance Certificate);
(ii) By local cheque / bank drafts remitted through normal banking channels or out of funds held in Non-
Resident External Account (NRE) or FCNR Account maintained with banks authorized to deal in
foreign currency in India, along with documentary evidence in support of remittance;
(iii) By Rupee draft purchased by debit to NRE/ FCNR Account maintained elsewhere in India and payable
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in Mumbai;
(iv) FIIs/FPIs registered with SEBI must remit funds from special non-resident rupee deposit account;
(v) Non-resident investors applying with repatriation benefits should draw cheques/ drafts in favour of
‘JMC Projects (India) Limited – Rights Issue - NR’ and must be crossed ‘account payee only’ for
the full application amount;
(vi) Investors may note that where payment is made by drafts purchased from NRE/ FCNR accounts, as the
case may be, an Account Debit Certificate from the bank issuing the draft confirming that the draft has
been issued by debiting the NRE/ FCNR account should be enclosed with the CAF. Otherwise the
application shall be considered incomplete and is liable to be rejected.
Application without repatriation benefits
(i) As far as non-residents holding Equity Shares on non-repatriation basis are concerned, in addition to
the modes specified above, payment may also be made by way of cheque drawn on Non-Resident
(Ordinary) Account maintained in India or Rupee Draft purchased out of NRO Account maintained
elsewhere in India but payable at Mumbai. In such cases, the Allotment of Equity Shares will be on
non-repatriation basis.
(ii) All cheques/ drafts submitted by non-residents applying on a non-repatriation basis should be drawn in
favour of ‘JMC Projects (India) Limited – Rights Issue – R’ and must be crossed ‘account payee
only’ for the full application amount. The CAFs duly completed together with the amount payable on
application must be deposited with the Collecting Bank indicated on the reverse of the CAFs before the
close of banking hours on or before the Issue Closing Date. A separate cheque or bank draft must
accompany each CAF.
(iii) Investors may note that where payment is made by drafts purchased from NRE/ FCNR/ NRO accounts,
as the case may be, an Account Debit Certificate from the bank issuing the draft confirming that the
draft has been issued by debiting the NRE/ FCNR/ NRO account should be enclosed with the CAF.
Otherwise the application shall be considered incomplete and is liable to be rejected.
(iv) New demat account shall be opened for holders who have had a change in status from resident Indian
to NRI. Any application from a demat account which does not reflect the accurate status of the
Applicant are liable to be rejected.
Notes:
In case where repatriation benefit is available, interest, dividend, sales proceeds derived from the
investment in Equity Shares can be remitted outside India, subject to tax, as applicable according to the
I.T. Act.
In case Equity Shares are allotted on a non-repatriation basis, the dividend and sale proceeds of the
Equity Shares cannot be remitted outside India.
The CAF duly completed together with the amount payable on application must be deposited with the
Collecting Bank indicated on the reverse of the CAFs before the close of banking hours on or before
the Issue Closing Date. A separate cheque or bank draft must accompany each CAF.
In case of an application received from non-residents, Allotment, refunds and other distribution, if any,
will be made in accordance with the guidelines/ rules prescribed by RBI as applicable at the time of
making such Allotment, remittance and subject to necessary approvals.
General instructions for non-ASBA Investors
(i) Please read the instructions printed on the CAF carefully.
(ii) Applicants that are not QIBs or are not Non – Institutional Investor or those whose Application Money
does not exceed ` 200,000 may participate in the Issue either through ASBA or the non-ASBA process.
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Eligible Equity Shareholders who have renounced their entitlement (in full or in part), Renouncees and
Applicants holding Equity Shares in physical form and/or subscribing in the Issue for Allotment in
physical form may participate in the Issue only through the non ASBA process.
(iii) Application should be made on the printed CAF, provided by us except as mentioned under the head
“Application on Plain Paper” on page 177 of the Letter of Offer and should be completed in all
respects. The CAF found incomplete with regard to any of the particulars required to be given therein,
and/ or which are not completed in conformity with the terms of the Letter of Offer or Abridged Letter
of Offer are liable to be rejected and the money paid, if any, in respect thereof will be refunded without
interest and after deduction of bank commission and other charges, if any. The CAF must be filled in
English and the names of all the Investors, details of occupation, address, father’s/ husband’s name
must be filled in block letters.
(iv) Eligible Equity Shareholders participating in the Issue other than through ASBA are required to fill
Part A of the CAF and submit the CAF along with Application Money before close of banking hours
on or before the Issue Closing Date or such extended time as may be specified by the Board in this
regard. The CAF together with the cheque/ demand draft should be sent to the Banker to the Issue/
Collecting Bank or to the Registrar to the Issue and not to us or Lead Manager to the Issue. Investors
residing at places other than cities where the branches of the Banker to the Issue have been authorised
by us for collecting applications, will have to make payment by demand draft payable at Mumbai of an
amount net of bank and postal charges and send their CAFs to the Registrar to the Issue by registered
post / speed post. If any portion of the CAF is/ are detached or separated, such application is liable to
be rejected. CAF’s received after banking hours on closure day will be liable for rejection.
(v) Applications where separate cheques/ demand drafts are not attached for amounts to be paid for Equity
Shares are liable to be rejected.
(vi) Except for applications on behalf of the Central and State Government, the residents of Sikkim and the
officials appointed by the courts, all Investors, and in the case of application in joint names, each of the
joint Investors, should mention his/ her PAN allotted under the I.T. Act, irrespective of the amount of
the application. CAFs without PAN will be considered incomplete and are liable to be rejected.
(vii) Investors, holding Equity Shares in physical form, are advised that it is mandatory to provide
information as to their savings/ current account number and the name of the bank with whom such
account is held in the CAF to enable the Registrar to the Issue to print the said details in the refund
orders, if any, after the names of the payees. Application not containing such details is liable to be
rejected.
(viii) All payment should be made by cheque/ demand draft only. Application through the ASBA process as
mentioned above is acceptable. Cash payment is not acceptable. In case payment is effected in
contravention of this, the application may be deemed invalid and the application money will be
refunded and no interest will be paid thereon.
(ix) Signatures should be either in English or Hindi or in any other language specified in the Eighth
Schedule to the Constitution of India. Signatures other than in English or Hindi and thumb impression
must be attested by a Notary Public or a Special Executive Magistrate under his/ her official seal. The
Equity Shareholders must sign the CAF as per the specimen signature recorded with us/ Depositories.
(x) In case of an application under power of attorney or by a body corporate or by a society, a certified true
copy of the relevant power of attorney or relevant resolution or authority to the signatory to make the
relevant investment under this Issue and to sign the application and certified true a copy of the
Memorandum and Articles of Association and/ or bye laws of such body corporate or society must be
lodged with the Registrar to the Issue giving reference of the serial number of the CAF. In case the
above referred documents are already registered with us, the same need not be a furnished again. In
case these papers are sent to any other entity besides the Registrar to the Issue or are sent after the Issue
Closing Date, then the application is liable to be rejected. In no case should these papers be attached to
the application submitted to the Banker to the Issue.
(xi) In case of joint holders, all joint holders must sign the relevant part of the CAF in the same order and as
per the specimen signature(s) recorded with us or the Depositories. Further, in case of joint Investors
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who are Renouncees, the number of Investors should not exceed three. In case of joint Investors,
reference, if any, will be made in the first Investor’s name and all communication will be addressed to
the first Investor.
(xii) Application(s) received from NRs/ NRIs, or persons of Indian origin residing abroad for Allotment of
Equity Shares shall, inter alia, be subject to conditions, as may be imposed from time to time by the
RBI under FEMA, including regulations relating to QFI’s, in the matter of refund of application
money, Allotment of Equity Shares, subsequent issue and Allotment of Equity Shares, interest, export
of share certificates, etc. In case a NR or NRI Equity Shareholder has specific approval from the RBI,
in connection with his shareholding, he should enclose a copy of such approval with the CAF.
Additionally, applications will not be accepted from NRs/ NRIs in the United States or its territories
and possessions, or any other jurisdiction where the offer or sale of the Rights Entitlements and Equity
Shares may be restricted by applicable securities laws.
(xiii) All communication in connection with application for the Equity Shares, including any change in
address of the Equity Shareholders should be addressed to the Registrar to the Issue prior to the date of
Allotment in this Issue quoting the name of the first/ sole Investor, folio numbers and CAF number.
Please note that any intimation for change of address of Equity Shareholders, after the date of
Allotment, should be sent to our Registrar and Transfer Agent, in the case of Equity Shares held in
physical form and to the respective depository participant, in case of Equity Shares held in
dematerialized form.
(xiv) SAFs cannot be re-split.
(xv) Only the Equity Shareholder(s) and not Renouncee(s) shall be entitled to obtain SAFs.
(xvi) Investors must write their CAF number at the back of the cheque/ demand draft.
(xvii) Only one mode of payment per application should be used. The payment must be by cheque/ demand
draft drawn on any of the banks, including a co-operative bank, which is situated at and is a member or
a sub member of the Bankers Clearing House located at the centre indicated on the reverse of the CAF
where the application is to be submitted.
(xviii) A separate cheque/ draft must accompany each CAF. Outstation cheques/ demand drafts or post-dated
cheques and postal/ money orders will not be accepted and applications accompanied by such
outstation cheques/ outstation demand drafts/ money orders or postal orders will be rejected.
(xix) No receipt will be issued for application money received. The Banker to the Issue/ Collecting Bank/
Registrar will acknowledge receipt of the same by stamping and returning the acknowledgment slip at
the bottom of the CAF.
(xx) The distribution of the Letter of Offer and issue of Equity Shares and Rights Entitlements to persons in
certain jurisdictions outside India may be restricted by legal requirements in those jurisdictions.
Persons in such jurisdictions are instructed to disregard the Letter of Offer and not to attempt to
subscribe for Equity Shares.
(xxi) Investors are requested to ensure that the number of Equity Shares applied for by them do not exceed
the prescribed limits under the applicable law.
(xxii) The Reserve Bank of India has issued standard operating procedure in terms of paragraph 2(a) of RBI
circular number DPSS.CO.CHD.No./133/04.07.05/2013-14 dated July 16, 2013, detailing the
procedure for processing CTS 2010 and Non-CTS 2010 instruments in the three CTS grid locations. As
per this circular, processing of non-CTS cheques shall be done only on three days of the week. As
prescribed by the SEBI Circular No.CIR/CFD/DIL/3/2010 dated April 22, 2010, the Equity Shares are
required to be listed within 12 Working Days of the closure of the issue. In order to enable compliance
with the above timelines, investors are advised to use CTS cheques or use ASBA facility to make
payment. Investors using non-CTS cheques are cautioned that applications accompanied by such
cheques are liable to be rejected due to any clearing delays beyond 6 working days from the date of the
closure of the issue, in terms of the aforesaid SEBI Circular.
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Do’s for non-ASBA Investors:
Check if you are eligible to apply i.e. you are an Equity Shareholder on the Record Date;
Read all the instructions carefully and ensure that the cheque/ draft option is selected in part A of the
CAF and necessary details are filled in;
In the event you hold Equity Shares in dematerialised form, ensure that the details about your
Depository Participant and beneficiary account are correct and the beneficiary account is activated as
the Equity Shares will be allotted in the dematerialized form only;
Ensure that your Indian address is available to us and the Registrar, in case you hold Equity Shares in
physical form or the depository participant, in case you hold Equity Shares in dematerialised form;
Ensure that the value of the cheque/ draft submitted by you is equal to the {(number of Equity Shares
applied for) X (Issue Price of Equity Shares, as the case may be)} before submission of the CAF.
Investors residing at places other than cities where the branches of the Banker to the Issue have been
authorised by us for collecting applications, will have to make payment by demand draft payable at
Mumbai of an amount net of bank and postal charges;
Ensure that you receive an acknowledgement from the collection branch of the Banker to the Issue for
your submission of the CAF in physical form;
Ensure that you mention your PAN allotted under the I.T. Act with the CAF, except for Applications
on behalf of the Central and State Governments, residents of the state of Sikkim and officials appointed
by the courts;
Ensure that the name(s) given in the CAF is exactly the same as the name(s) in which the beneficiary
account is held with the Depository Participant. In case the CAF is submitted in joint names, ensure
that the beneficiary account is also held in same joint names and such names are in the same sequence
in which they appear in the CAF;
Ensure that the demographic details are updated, true and correct, in all respects.
Don’ts for non-ASBA Investors:
Do not apply if you are not eligible to participate in the Issue under the securities laws applicable to
your jurisdiction;
Do not apply on duplicate CAF after you have submitted a CAF to a collection branch of the Banker to
the Issue;
Do not pay the amount payable on application in cash, by money order or by postal order;
Do not submit the GIR number instead of the PAN as the application is liable to be rejected on this
ground;
Do not submit Application accompanied with Stock invest;
Grounds for Technical Rejections for non-ASBA Investors
Investors are advised to note that applications are liable to be rejected on technical grounds, including the
following:
Amount paid does not tally with the amount payable;
Bank account details (for refund) are not given and the same are not available with the DP (in the case
of dematerialized holdings) or the Registrar (in the case of physical holdings);
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Submission of CAFs to the SCSBs;
Submission of plain paper Applications to any person other than the Registrar to the Issue;
Age of Investor(s) not given (in case of Renouncees);
Except for CAFs on behalf of the Central or State Government, the residents of Sikkim and the
officials appointed by the courts, PAN not given for application of any value;
In case of CAF under power of attorney or by limited companies, corporate, trust, relevant documents
are not submitted;
If the signature of the Equity Shareholder does not match with the one given on the CAF and for
Renouncee(s) if the signature does not match with the records available with their Depositories;
CAFs are not submitted by the Investors within the time prescribed as per the CAF and the Letter of
Offer;
CAFs not duly signed by the sole/ joint Investors;
CAFs/ SAFs by OCBs not accompanied by a copy of an RBI approval to apply in this Issue;
CAFs accompanied by Stockinvest/ outstation cheques/ post-dated cheques/ money order/ postal order/
outstation demand draft;
In case no corresponding record is available with the Depositories that matches three parameters,
namely, names of the Investors (including the order of names of joint holders), the Depositary
Participant’s identity (DP ID) and the beneficiary’s identity;
CAFs that do not include the certifications set out in the CAF to the effect that the subscriber is not a
“U.S. Person” (as defined in Regulation S) and does not have a registered address (and is not otherwise
located) in the United States or other restricted jurisdictions and is authorized to acquire the Rights
Entitlements and Equity Shares in compliance with all applicable laws and regulations;
CAFs which have evidence of being executed in/ dispatched from restricted jurisdictions;
CAFs by ineligible non-residents (including on account of restriction or prohibition under applicable
local laws) and where the registered addressed in India has not been provided;
CAFs where we believe that CAF is incomplete or acceptance of such CAF may infringe applicable
legal or regulatory requirements;
In case the GIR number is submitted instead of the PAN;
CAFs submitted by Renouncees where Part B of the CAF is incomplete or is unsigned. In case of joint
holding, all joint holders must sign Part ‘B’ of the CAF;
Applications by persons not competent to contract under the Contract Act, 1872, as amended, except
bids by minors having valid demat accounts as per the demographic details provided by the
Depositories.
Applications by Renouncees who are persons not competent to contract under the Indian Contract Act,
1872, including minors;
Multiple CAFs, including cases where an Investor submits CAFs along with a plain paper application;
and
Applications from QIBs, Non-Institutional Investors (including applications for less than ` 200,000) or
Investors applying in this Issue for Equity Shares for an amount exceeding ` 200,000, not through
ASBA process.
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Please read the Letter of Offer or Abridged Letter of Offer and the instructions contained therein and in the CAF
carefully before filling in the CAF. The instructions contained in the CAF are an integral part of the Letter of
Offer and must be carefully followed. The CAF is liable to be rejected for any non-compliance of the provisions
contained in the Letter of Offer or the CAF.
PROCEDURE FOR APPLICATION THROUGH THE APPLICATIONS SUPPORTED BY BLOCKED
AMOUNT (“ASBA”) PROCESS
This section is for the information of the ASBA Investors proposing to subscribe to the Issue through the ASBA
Process. The Lead Manager and we are not liable for any amendments or modifications or changes in applicable
laws or regulations, which may occur after the date of the Letter of Offer. Investors who are eligible to apply
under the ASBA Process are advised to make their independent investigations and to ensure that the CAF is
correctly filled up.
The Lead Manager, we, our directors, affiliates, associates and their respective directors and officers and the
Registrar to the Issue shall not take any responsibility for acts, mistakes, errors, omissions and commissions etc.
in relation to applications accepted by SCSBs, applications uploaded by SCSBs, applications accepted but not
uploaded by SCSBs or applications accepted and uploaded without blocking funds in the ASBA Accounts. It
shall be presumed that for applications uploaded by SCSBs, the amount payable on application has been blocked
in the relevant ASBA Account.
Please note that pursuant to the applicability of the directions issued by SEBI vide its circular bearing number
CIR/CFD/DIL/1/ 2011 dated April 29, 2011, all applicants who are (i) QIBs, (ii) Non-Institutional Investors or
(iii) other applicants whose application amount exceeds ` 200,000 can participate in the Issue only through the
ASBA process, subject to them complying with the requirements of SEBI Circular dated December 30, 2009.
Further, all QIB applicants and Non-Institutional Investors are mandatorily required to use ASBA, even if
application amount does not exceed ` 200,000, subject to their fulfilling the eligibility conditions to be an
ASBA Investor. The Investors who are (i) not QIBs, (ii) not Non-Institutional Investors, or (iii) investors whose
application amount is less than ` 200,000 can participate in the Issue either through the ASBA process or the
non ASBA process. Notwithstanding anything contained hereinabove, all Renouncees (including Renouncees
who are Individuals) shall apply in the Issue only through the non-ASBA process.
Further, in terms of the SEBI circular CIR/CFD/DIL/1/2013 dated January 2, 2013 it is clarified that for making
applications by banks on own account using ASBA facility, SCSBs should have a separate account in own name
with any other SEBI registered SCSB(s). Such account shall be used solely for the purpose of making
application in public issues and clear demarcated funds should be available in such account for ASBA
applications. SCSBs applying in the Issue using the ASBA facility shall be responsible for ensuring that they
have a separate account in its own name with any other SCSB having clear demarcated funds for applying in the
Issue and that such separate account shall be used as the ASBA Account for the application, in accordance with
the applicable regulations.
The list of banks which have been notified by SEBI to act as SCSBs for the ASBA Process is provided on
http://www.sebi.gov.in and/or such other website(s) as may be prescribed by the SEBI / Stock Exchange(s)
from time to time. For details on Designated Branches of SCSBs collecting the CAF, please refer the above
mentioned SEBI link.
Equity Shareholders who are eligible to apply under the ASBA Process
The option of applying for Rights Equity Shares through the ASBA Process is available only to the Equity
Shareholders on the Record Date.
To qualify as ASBA Applicants, Eligible Equity Shareholders:
are required to hold Equity Shares in dematerialized form as on the Record Date and apply for (i) their
Rights Entitlement or (ii) their Rights Entitlement and Equity Shares in addition to their Rights Entitlement
in dematerialized form;
should not have renounced their Right Entitlement in full or in part;
should not have split the CAF and further renounced it;
should not be Renouncees;
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should apply through blocking of funds in bank accounts maintained with SCSBs; and
are eligible under applicable securities laws to subscribe for the Rights Entitlement and the Rights Equity
Shares in the Issue.
CAF
The Registrar will dispatch the CAF to all Eligible Equity Shareholders as per their Rights Entitlement on the
Record Date for the Issue. Those Eligible Equity Shareholders who must apply or who wish to apply through the
ASBA will have to select for this ASBA mechanism in Part A of the CAF and provide necessary details.
Eligible Equity Shareholders desiring to use the ASBA Process are required to submit their applications by
selecting the ASBA option in Part A of the CAF. Application in electronic mode will only be available with
such SCSBs who provide such facility. The Eligible Equity Shareholder shall submit the CAF to the Designated
Branch of the SCSB for authorising such SCSB to block an amount equivalent to the amount payable on the
application in the ASBA Account.
More than one ASBA Investor may apply using the same ASBA Account, provided that SCSBs will not accept
a total of more than five CAFs with respect to any single ASBA Account as provided for under the SEBI
Circular dated December 30, 2009.
Acceptance of the Issue
You may accept the Issue and apply for the Rights Equity Shares either in full or in part, by filling Part A of the
respective CAFs sent by the Registrar, selecting the ASBA option in Part A of the CAF and submit the same to
the Designated Branch of the SCSB before the close of the banking hours on or before the Issue Closing Date or
such extended time as may be specified by the Board of Directors or any committee thereof in this regard.
Mode of payment
The Eligible Equity Shareholder applying under the ASBA Process agrees to block the entire amount payable on
application with the submission of the CAF, by authorizing the SCSB to block an amount, equivalent to the
amount payable on application, in an ASBA Account.
After verifying that sufficient funds are available in the ASBA Account details of which are provided in the
CAF, the SCSB shall block an amount equivalent to the amount payable on application mentioned in the CAF
until it receives instructions from the Registrar. Upon receipt of instructions from the Registrar, the SCSBs shall
transfer amount to the extent of Equity Shares allotted in the Rights Issue as per the Registrar’s instruction from
the ASBA Account. This amount will be transferred in terms of the SEBI ICDR Regulations, into the separate
bank account maintained by our Company for the purpose of the Issue.. The balance amount blocked shall be
unblocked by the SCSBs on the basis of the instructions issued in this regard by the Registrar to the Issue to the
respective SCSB.
The Equity Shareholders applying under the ASBA Process would be required to give instructions to the
respective SCSBs to block the entire amount payable on their application at the time of the submission of the
CAF.
The SCSB may reject the application at the time of acceptance of CAF if the ASBA Account, details of which
have been provided by the Equity Shareholder in the CAF does not have sufficient funds equivalent to the
amount payable on application mentioned in the CAF. Subsequent to the acceptance of the application by the
SCSB, we would have a right to reject the application only on technical grounds.
Please note that in accordance with the provisions of the SEBI circular number CIR/CFD/DIL/1/2011
dated April 29, 2011 all QIBs and Non-Institutional Investors complying with the eligibility conditions
prescribed under the SEBI circular dated December 30, 2009 must mandatorily invest through the ASBA
process.
Options available to the Eligible Equity Shareholders applying under the ASBA Process
The summary of options available to the Equity Shareholders is presented below. You may exercise any of the
following options with regard to the Equity Shares, using the respective CAFs received from Registrar:
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Option Available Action Required
1. Accept whole or part of your Rights
Entitlement without renouncing the balance
Fill in and sign Part A of the CAF (All joint holders
must sign)
2. Accept your Rights Entitlement in full and
apply for additional Equity Shares
Fill in and sign Part A of the CAF including Block
III relating to the acceptance of entitlement and
Block IV relating to additional Equity Shares (All
joint holders must sign)
The Eligible Equity Shareholders applying under the ASBA Process will need to select the ASBA process
option in the CAF and provide required necessary details. However, in cases where this option is not selected,
but the CAF is tendered to the designated branch of the SCSBs with the relevant details required under the
ASBA process option and the SCSBs block the requisite amount, then that CAF would be treated as if the
Equity Shareholder has selected to apply through the ASBA process option.
Additional Equity Shares
You are eligible to apply for additional Equity Shares over and above the number of Equity Shares that you are
entitled to, provided that you are eligible to apply for the Equity Shares under applicable law and you have
applied for all the Equity Shares (as the case may be) offered without renouncing them in whole or in part in
favour of any other person(s). Where the number of additional Equity Shares applied for exceeds the number
available for Allotment, the Allotment would be made as per the Basis of Allotment in consultation with the
Designated Stock Exchange. Applications for additional Equity Shares shall be considered and Allotment shall
be made at the sole discretion of the Board, in consultation with the Designated Stock Exchange and in the
manner prescribed under “Terms of the Issue” on page 167 of the Letter of Offer.
If you desire to apply for additional Equity Shares, please indicate your requirement in the place provided for
additional Equity Shares in Part A of the CAF. The Renouncee applying for all the Equity Shares renounced in
their favour may also apply for additional Equity Shares.
Renunciation under the ASBA Process
ASBA Investors can neither be Renouncees, nor can renounce their Rights Entitlement.
Application on Plain Paper
An Equity Shareholder who has neither received the original CAF nor is in a position to obtain the duplicate
CAF and who is applying under the ASBA Process may make an application to subscribe to the Issue on plain
paper. The Equity Shareholder shall submit the plain paper application to the the Designated Branch of SCSB
for authorising such SCSB to block an amount equivalent to the amount payable on the application in the said
bank account maintained with the same SCSB. Applications on plain paper from any address outside India will
not be accepted.
The envelope should be superscribed “JMC Projects (India) Limited – Rights Issue- R” or “JMC Projects
(India) Limited – Rights Issue- NR”, as the case may be. The application on plain paper, duly signed by the
Investors including joint holders, in the same order as per the specimen recorded with us or the Depositories,
must reach the office of the Registrar before the Issue Closing Date and should contain the following particulars:
Name of Issuer,JMC Projects (India) Ltd. ;
Name and address of the Equity Shareholder including joint holders;
Registered Folio Number/ DP and Client ID no.;
Certificate numbers and distinctive numbers of Equity Shares, if held in physical form;
Number of Equity Shares held as on Record Date;
Number of Equity Shares entitled to;
Number of Equity Shares applied for;
Number of additional Equity Shares applied for, if any;
Total number of Equity Shares applied for;
Total amount to be paid at the rate of ` 201 per Equity Share; :
Details of the ASBA Account such as the account number, name, address and branch of the relevant SCSB;
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In case of non-resident investors, details of the NRE/ FCNR/ NRO account such as the account number,
name, address and branch of the SCSB with which the account is maintained;
Except for applications on behalf of the Central or State Government, residents of Sikkim and the officials
appointed by the courts (subject to submitting sufficient documentary evidence in support of their claim for
exemption, provided that such transactions are undertaken on behalf of the Central and State Government
and not in their personal capacity), PAN of the Investor and for each Investor in case of joint names,
irrespective of the total value of the Equity Shares applied for pursuant to the Issue;
Signature of the Shareholders to appear in the same sequence and order as they appear in our records or
depositories records; and
Additionally, all such applicants are deemed to have accepted the following:
“I/ We understand that neither the Rights Entitlement nor the Equity Shares have been, and will be,
registered under the United States Securities Act of 1933 (the “US Securities Act”) or any United States
state securities laws, and may not be offered, sold, resold or otherwise transferred within the United States
or to the territories or possessions thereof (the “United States” or to or for the account or benefit of a
“U.S. Person” as defined in Regulation S of the US Securities Act (“Regulation S”). I/ we understand the
Equity Shares referred to in this application are being offered in India but not in the United States. I/ we
understand the offering to which this application relates is not, and under no circumstances is to be
construed as, an offering of any Equity Shares or Rights Entitlement for sale in the United States, or as a
solicitation therein of an offer to buy any of the said Equity Shares or Rights Entitlement in the United
States. Accordingly, I/ we understand this application should not be forwarded to or transmitted in or to the
United States at any time. I/ we understand that none of we, the Registrar, the Lead Manager or any other
person acting on behalf of us will accept subscriptions from any person, or the agent of any person, who
appears to be, or who, we, the Registrar, the Lead Manager or any other person acting on behalf of we
have reason to believe is, a resident of the United States or a “U.S. Person” as defined in Regulation S, or
is ineligible to participate in the Issue under the securities laws of their jurisdiction.
I/ We will not offer, sell or otherwise transfer any of the Equity Shares which may be acquired by us in any
jurisdiction or under any circumstances in which such offer or sale is not authorized or to any person to
whom it is unlawful to make such offer, sale or invitation except under circumstances that will result in
compliance with any applicable laws or regulations. We satisfy, and each account for which we are acting
satisfies, all suitability standards for investors in investments of the type subscribed for herein imposed by
the jurisdiction of our residence.
I/ We understand and agree that the Rights Entitlement and Equity Shares may not be reoffered, resold,
pledged or otherwise transferred except in an offshore transaction in compliance with Regulation S, or
otherwise pursuant to an exemption from, or in a transaction not subject to, the registration requirements of
the US Securities Act.
I/ We (i) am/ are, and the person, if any, for whose account I/ we am/ are acquiring such Rights Entitlement
and/ or the Equity Shares is/ are, outside the United States, (ii) am/ are not a “U.S. Person” as defined in
(“Regulation S”), and (iii) am / are acquiring the Rights Entitlement and/ or the Equity Shares in an
offshore transaction meeting the requirements of Regulation S.
I/ We acknowledge that we, the Lead Manager, their affiliates and others will rely upon the truth and
accuracy of the foregoing representations and agreements.”
Please note that those who are making the application otherwise than on original CAF shall not be entitled to
renounce their rights and should not utilize the original CAF for any purpose including renunciation even if it is
received subsequently. If the Investor violates such requirements, he/she shall face the risk of rejection of both
the applications. We shall refund such application amount to the Investor without any interest thereon
Option to receive Equity Shares in Dematerialized Form
EQUITY SHAREHOLDERS UNDER THE ASBA PROCESS MAY PLEASE NOTE THAT THE
EQUITY SHARES UNDER THE ASBA PROCESS CAN BE ALLOTTED ONLY IN
DEMATERIALIZED FORM AND TO THE SAME DEPOSITORY ACCOUNT IN WHICH THE
EQUITY SHARES ARE HELD BY SUCH ASBA APPLICANT ON THE RECORD DATE.
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General instructions for Equity Shareholders applying under the ASBA Process
Please read the instructions printed on the CAF carefully.
Application should be made on the printed CAF only and should be completed in all respects. The CAF
found incomplete with regard to any of the particulars required to be given therein, and/ or which are not
completed in conformity with the terms of the Letter of Offer and the Abridged Letter of Offer are liable to
be rejected. The CAF must be filled in English.
ASBA Applicants are required to select this mechanism in Part A of the CAF and provide necessary details,
including details of the ASBA Account, authorizing the SCSB to block an amount equal to the Application
Money in the ASBA Account mentioned in the CAF, and including the signature of the ASBA Account
holder if the ASBA Account holder is different from the Applicant.
The CAF in the ASBA Process should be submitted at a Designated Branch of the SCSB and whose ASBA
Account/ bank account details are provided in the CAF and not to the Banker to the Issue/ Collecting Banks
(assuming that such Collecting Bank is not a SCSB), to us or Registrar or Lead Manager to the Issue.
All applicants, and in the case of application in joint names, each of the joint applicants, should mention his/
her PAN allotted under the IT Act, irrespective of the amount of the application. Except for applications on
behalf of the Central or State Government, the residents of Sikkim and the officials appointed by the courts,
CAFs without PAN will be considered incomplete and are liable to be rejected. With effect from August 16,
2010, the demat accounts for Investors for which PAN details have not been verified shall be “suspended
for credit” and no allotment and credit of Equity Shares shall be made into the accounts of such Investors.
All payments will be made by blocking the amount in the ASBA Account. Cash payment or payment by
cheque/ demand draft/ pay order is not acceptable. In case payment is effected in contravention of this, the
application may be deemed invalid and the application money will be refunded and no interest will be paid
thereon.
Signatures should be either in English or Hindi or in any other language specified in the Eighth Schedule to
the Constitution of India. Signatures other than in English or Hindi and thumb impression must be attested
by a Notary Public or a Special Executive Magistrate under his/ her official seal. The Equity Shareholders
must sign the CAF as per the specimen signature recorded with us and/ or Depositories.
In case of joint holders, all joint holders must sign the relevant part of the CAF in the same order and as per
the specimen signature(s) recorded with the depository/ us. In case of joint applicants, reference, if any, will
be made in the first applicant’s name and all communication will be addressed to the first applicant.
All communication in connection with application for the Equity Shares, including any change in address of
the Equity Shareholders should be addressed to the Registrar to the Issue prior to the date of Allotment in
this Issue quoting the name of the first/ sole applicant Equity Shareholder, folio numbers and CAF number.
Only the person or persons to whom the Equity Shares have been offered and not renouncee(s) shall be
eligible to participate under the ASBA process.
Only persons outside restricted jurisdictions and who are eligible to subscribe for Rights Entitlement and
Equity Shares under applicable securities laws are eligible to participate.
Only the Equity Shareholders holding shares in demat are eligible to participate through ASBA process.
Equity shareholders who have renounced their entitlement in part/ full are not entitled to apply using ASBA
process.
Please note that pursuant to the applicability of the directions issued by SEBI vide its circular bearing
number CIR/CFD/DIL/1/ 2011 dated April 29, 2011, all applicants who are QIBs, Non-Institutional
Investor and other applicants whose application amount exceeds ` 200,000 can participate in the Issue only
through the ASBA process, subject to their fulfilling the eligibility conditions to be an ASBA Investors.
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Further, all QIB applicants and Non-Institutional Investors are mandatorily required to use ASBA, even if
application amount does not exceed ` 200,000, subject to their fulfilling the eligibility conditions to be an
ASBA Investor. The Investors who are (i) not QIBs, (ii) not Non-Institutional Investors, or (iii) investors
whose application amount is less than ` 200,000 can participate in the Issue either through the ASBA
process or the non ASBA process. Notwithstanding anything contained hereinabove, all Renouncees
(including Renouncees who are Individuals) shall apply in the Issue only through the non-ASBA process.
Further, in terms of the SEBI circular CIR/CFD/DIL/1/2013 dated January 2, 2013 it is clarified that for
making applications by banks on own account using ASBA facility, SCSBs should have a separate account
in own name with any other SEBI registered SCSB(s). Such account shall be used solely for the purpose of
making application in public issues and clear demarcated funds should be available in such account for
ASBA applications. SCSBs applying in the Issue using the ASBA facility shall be responsible for ensuring
that they have a separate account in its own name with any other SCSB having clear demarcated funds for
applying in the Issue and that such separate account shall be used as the ASBA Account for the application,
in accordance with the applicable regulations.
In case of non – receipt of CAF, application can be made on plain paper mentioning all necessary details as
mentioned under the heading “Application on Plain Paper” on page 177 of the Letter of Offer.
Do’s:
Ensure compliance with eligibility conditions prescribed under the SEBI circular dated December 30, 2009.
Ensure that the ASBA Process option is selected in part A of the CAF and necessary details are filled in.
Ensure that the details about your Depository Participant and beneficiary account are correct and the
beneficiary account is activated as Equity Shares will be allotted in the dematerialized form only.
Ensure that the CAFs are submitted with the Designated Branch of the SCSBs and details of the correct
bank account have been provided in the CAF.
Ensure that there are sufficient funds (equal to {number of Equity Shares as the case may be applied for} X
{Issue Price of Equity Shares, as the case may be}) available in the ASBA Account mentioned in the CAF
before submitting the CAF to the respective Designated Branch of the SCSB.
Ensure that you have authorised the SCSB for blocking funds equivalent to the total amount payable on
application mentioned in the CAF, in the ASBA Account, of which details are provided in the CAF and
have signed the same.
Ensure that you receive an acknowledgement from the Designated Branch of the SCSB for your submission
of the CAF in physical form.
Except for CAFs submitted on behalf of the Central or State Government, the residents of Sikkim and the
officials appointed by the courts, each applicant should mention their PAN allotted under the I T Act.
Ensure that the name(s) given in the CAF is exactly the same as the name(s) in which the beneficiary
account is held with the Depository Participant. In case the CAF is submitted in joint names, ensure that the
beneficiary account is also held in same joint names and such names are in the same sequence in which they
appear in the CAF.
Ensure that the Demographic Details are updated, true and correct, in all respects.
Ensure that the account holder in whose bank account the funds are to be blocked has signed authorising
such funds to be blocked.
Apply under ASBA process only if you comply with the definition of an ASBA Investor.
Dont’s:
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Do not apply if you are not eligible to participate in the Issue under the securities laws applicable to your
jurisdiction.
Do not apply on duplicate CAF after you have submitted a CAF to a Designated Branch of the SCSB.
Do not pay the amount payable on application in cash, by money order, by pay order or by postal order.
Do not send your physical CAFs to the Lead Manager to Issue/ Registrar/ Collecting Banks (assuming that
such Collecting Bank is not a SCSB)/ to a branch of the SCSB which is not a Designated Branch of the
SCSB/ Company; instead submit the same to a Designated Branch of the SCSB only.
Do not submit the GIR number instead of the PAN as the application is liable to be rejected on this ground.
Do not apply if the ASBA account has already been used for five Eligible Equity Shareholders.
Do not apply through the ASBA Process if you are not an ASBA Investor.
Do not instruct the SCSBs to release the funds blocked under the ASBA Process.
Grounds for Technical Rejections under the ASBA Process
In addition to the grounds listed under “Grounds for Technical Rejections for non-ASBA Investors”, applications
under the ABSA Process are liable to be rejected on the following grounds:
Application on a SAF by a person who has renounced or by a renouncee.
Application for allotment of Rights Entitlements or additional Equity Shares which are in physical form.
DP ID and Client ID mentioned in CAF not matching with the DP ID and Client ID records available with
the Registrar.
Submission of an ASBA application on plain paper to a person other than a SCSB.
Sending CAF to a Lead Manager/ Registrar/ Collecting Bank (assuming that such Collecting Bank is not a
SCSB)/ to a branch of a SCSB which is not a Designated Branch of the SCSB/ Company.
Insufficient funds are available with the SCSB for blocking the amount.
Funds in the bank account with the SCSB whose details have been mentioned in the CAF / Plain Paper
Application having been frozen pursuant to regulatory order.
ASBA Account holder not signing the CAF or declaration mentioned therein.
CAFs that do not include the certification set out in the CAF to the effect that the subscriber is not a “U.S.
Person” (as defined under Regulation S) and does not have a registered address (and is not otherwise
located) in the United States or restricted jurisdictions and is authorized to acquire the rights and the
securities in compliance with all applicable laws and regulations.
CAFs which have evidence of being executed in/ dispatched from a restricted jurisdiction or executed by or
for the account or benefit of a U.S. Person (as defined in Regulation S).
Renouncees applying under the ASBA Process.
Submission of more than five CAFs per ASBA Account.
QIBs, Non-Institutional Investors and other Equity Shareholders who are eligible ASBA Investors (as per
conditions of the SEBI circular dated December 30, 2009) applying for Equity Shares in this Issue for value
of more than ` 2,00,000 holding Equity Shares in dematerialised form and not renouncing or accepting
Equity Shares from an Eligible Equity Shareholder, not applying through the ASBA process.
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QIB applicants and Non-Institutional Investors making an application of below ` 2,00,000 and not applying
through the ASBA process subject to their fulfilling the eligibility conditions to be an ASBA Investor.
The application by an Equity Shareholder whose cumulative value of Equity Shares applied for is more than
` 200,000 but has applied separately through split CAFs of less than ` 200,000 and has not done so through
the ASBA process.
Multiple CAFs, including cases where an Investor submits CAFs along with a plain paper application.
Submitting the GIR number instead of the PAN.
An investor, who is not complying with any or all of the conditions for being an ASBA Investor, applies
under the ASBA process.
Applications by persons not competent to contract under the Contract Act, 1872, as amended, except
applications by minors having valid demat accounts as per the demographic details provided by the
Depositories.
ASBA Bids by SCSBs applying through the ASBA process on own account, other than through an ASBA
Account in its own name with any other SCSB.
Depository account and bank details for Equity Shareholders applying under the ASBA Process
IT IS MANDATORY FOR ALL THE ELIGIBLE EQUITY SHAREHOLDERS APPLYING UNDER
THE ASBA PROCESS TO RECEIVE THEIR EQUITY SHARES IN DEMATERIALISED FORM AND
TO THE SAME DEPOSITORY ACCOUNT IN WHICH THE EQUITY SHARES ARE HELD BY THE
EQUITY SHAREHOLDER ON THE RECORD DATE. ALL EQUITY SHAREHOLDERS APPLYING
UNDER THE ASBA PROCESS SHOULD MENTION THEIR DEPOSITORY PARTICIPANT’S
NAME, DEPOSITORY PARTICIPANT IDENTIFICATION NUMBER AND BENEFICIARY
ACCOUNT NUMBER IN THE CAF. EQUITY SHAREHOLDERS APPLYING UNDER THE ASBA
PROCESS MUST ENSURE THAT THE NAME GIVEN IN THE CAF IS EXACTLY THE SAME AS
THE NAME IN WHICH THE DEPOSITORY ACCOUNT IS HELD. IN CASE THE CAF IS
SUBMITTED IN JOINT NAMES, IT SHOULD BE ENSURED THAT THE DEPOSITORY ACCOUNT
IS ALSO HELD IN THE SAME JOINT NAMES AND ARE IN THE SAME SEQUENCE IN WHICH
THEY APPEAR IN THE CAF / PLAIN PAPER APPLICATIONS, AS THE CASE MAY BE.
Equity Shareholders applying under the ASBA Process should note that on the basis of name of these Equity
Shareholders, Depository Participant’s name and identification number and beneficiary account number
provided by them in the CAF / plain paper applications, as the case may be, the Registrar to the Issue will obtain
from the Depository demographic details of these Equity Shareholders such as address, bank account details for
printing on refund orders and occupation (“Demographic Details”). Hence, Equity Shareholders applying under
the ASBA Process should carefully fill in their Depository Account details in the CAF.
These Demographic Details would be used for all correspondence with such Equity Shareholders including
mailing of the letters intimating unblocking of their respective ASBA Accounts. The Demographic Details given
by the Equity Shareholders in the CAF would not be used for any other purposes by the Registrar. Hence,
Equity Shareholders are advised to update their Demographic Details as provided to their Depository
Participants.
By signing the CAFs, the Equity Shareholders applying under the ASBA Process would be deemed to have
authorised the Depositories to provide, upon request, to the Registrar to the Issue, the required Demographic
Details as available on its records.
Letters intimating Allotment and unblocking the funds would be mailed at the address of the Equity Shareholder
applying under the ASBA Process as per the Demographic Details received from the Depositories. The
Registrar to the Issue will give instructions to the SCSBs for unblocking funds in the ASBA Account to the
extent Equity Shares are not allotted to such Equity Shareholders. Equity Shareholders applying under the
ASBA Process may note that delivery of letters intimating unblocking of the funds may get delayed if the same
once sent to the address obtained from the Depositories are returned undelivered. In such an event, the address
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and other details given by the Equity Shareholder in the CAF would be used only to ensure dispatch of letters
intimating unblocking of the ASBA Accounts.
Note that any such delay shall be at the sole risk of the Equity Shareholders applying under the ASBA Process
and none of us, the SCSBs or the Lead Manager shall be liable to compensate the Equity Shareholder applying
under the ASBA Process for any losses caused due to any such delay or liable to pay any interest for such delay.
In case no corresponding record is available with the Depositories that matches three parameters, (a) names of
the Equity Shareholders (including the order of names of joint holders), (b) the DP ID, and (c) the beneficiary
account number, then such applications are liable to be rejected.
Issue Schedule:
Issue Opening Date: January 22, 2016
Last date for receiving requests for SAFs: January 29, 2016
Issue Closing Date: February 5, 2016
The Board may however decide to extend the Issue period, as it may determine from time to time, but not
exceeding 30 days from the Issue Opening Date.
Basis of Allotment
Subject to the provisions contained in Letter of Offer, the Letter of Offer, the Articles of Association and the
approval of the Designated Stock Exchange, the Board will proceed to Allot the Equity Shares in the following
order of priority:
(i) Full Allotment to those Equity Shareholders who have applied for their Rights Entitlement either in full
or in part and also to the Renouncee(s) who has/ have applied for Equity Shares renounced in their
favour, in full or in part.
(ii) Investors whose fractional entitlements are being ignored would be given preference in allotment of
one additional Equity Share each if they apply for additional Equity Share. Allotment under this head
shall be considered if there are any unsubscribed Equity Shares after allotment under (a) above. If
number of Equity Shares required for Allotment under this head are more than number of Equity
Shares available after Allotment under (i) above, the Allotment would be made on a fair and equitable
basis in consultation with the Designated Stock Exchange, as a part of Issue and will not be a
preferential allotment.
(iii) Allotment to the Equity Shareholders who having applied for all the Equity Shares offered to them as
part of the Issue and have also applied for additional Equity Shares. The Allotment of such additional
Equity Shares will be made as far as possible on an equitable basis having due regard to the number of
Equity Shares held by them on the Record Date, provided there is an unsubscribed portion after making
full Allotment in (i) and (ii) above. The Allotment of such Equity Shares will be at the sole discretion
of the Board/ Committee of Directors in consultation with the Designated Stock Exchange, as a part of
the Issue and will not be a preferential allotment.
(iv) Allotment to Renouncees who having applied for all the Equity Shares renounced in their favour, have
applied for additional Equity Shares provided there is surplus available after making full Allotment
under (i), (ii) and (iii) above. The Allotment of such Equity Shares will be at the sole discretion of the
Board/ Committee of Directors in consultation with the Designated Stock Exchange, as a part of the
Issue and will not be a preferential allotment.
(v) Allotment to any other person that the Board of Directors in their absolute discretion decide.
After taking into account Allotment to be made under (i) to (iv) above, if there is any unsubscribed
portion, the same shall be deemed to be ‘unsubscribed’
Our Promoter through its letter dated September 23, 2015 has confirmed (on behalf of itself and other
members of promoter group), that, it, either through itself or through other member(s) of promoter
group, intend to subscribe to their Rights Entitlement in full in the Issue, in compliance with regulation
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10(4) of Takeover Regulations. In addition to subscription to their Rights Entitlements, the Promoter
has also confirmed that it, either through itself or through other member(s) of promoter group, also
intend to (i) subscribe to additional Equity Shares, and (ii) subscribe for unsubscribed portion in the
Issue, if any. Such subscription to additional Equity Shares and the unsubscribed portion, if any, shall
be in accordance with regulation 10(4) of Takeover Regulations subject to their total shareholding not
exceeding 75% of the issued, outstanding and fully paid up Equity Share capital in accordance with the
provisions of the Equity Listing Agreement.
Such subscription for Equity Shares over and above their Rights Entitlement, if allotted, may result in
an increase in their percentage shareholding. Any such acquisition of additional Equity Shares of the
Company shall not result in a change of control of the management of the Company in accordance with
provisions of the Takeover Regulations and shall be exempt in terms of Regulation 10 (4) (a) and (b) of
the Takeover Regulations.
Presently our Company is complying with Regulation 38 of the SEBI Listing Regulations read with
Rule 19A of the Securities Contracts (Regulation) Rules, 1957, in connection with the requirement of
maintaining the minimum public shareholding, i.e. at least 25% of the total paid up equity capital is
held by public, for continuous listing.
Underwriting
Our Company has not currently entered into any underwriting arrangement. We may enter into such an
arrangement for the purpose of this Issue at an appropriate time and on such terms and conditions as we may
deem fit. In the event our Company enters into such an arrangement, which shall be done, prior to the filing of
the Letter of Offer with the Designated Stock Exchange, we shall disclose the details of the underwriting
arrangement in the Letter of Offer as required under the SEBI ICDR Regulations.
Allotment Advices/ Refund Orders
Our Company will issue and dispatch allotment advice/ share certificates/ demat credit and/ or letters of regret
along with refund order or credit the allotted Equity Shares to the respective beneficiary accounts, if any, within
15 days from the Issue Closing Date. If there is a delay beyond 8 days from the stipulated period (i.e. 15 days
from the closure of the Issue) our Company shall be punishable with a fine which shall not be less than five lakh
rupees but which may extend to fifty lakh rupees and every officer of our Company in default shall be
punishable with imprisonment for a term of one year or with fine which shall not be less than fifty thousand
rupees but may extend to three lakh rupees or with both in accordance with Section 40 (5) of the Companies
Act, 2013.
Investors residing at centres where clearing houses are managed by the Reserve Bank of India ("RBI"), payment
of refund would be done through NECS and for applicants having an account at any of the centres where such
facility has been made available to get refunds through direct credit and real time gross settlement ("RTGS").
In case of those Investors who have opted to receive their Rights Entitlement in dematerialized form using
electronic credit under the depository system, advice regarding their credit of the Equity Shares shall be given
separately. Investors to whom refunds are made through electronic transfer of funds will be sent a letter through
ordinary post intimating them about the mode of credit of refund within 15 days of the Issue Closing Date.
In case of those Investors who have opted to receive their Rights Entitlement in physical form and we issue
letter of allotment, the corresponding share certificates will be kept ready within two months from the date of
Allotment thereof or such extended time as may be approved by the Company Law Board or other applicable
provisions, if any. Investors are requested to preserve such letters of allotment, which would be exchanged later
for the share certificates.
The letter of allotment/ refund order would be sent by registered post/ speed post to the sole/ first Investor’s
registered address in India or the Indian address provided by the Equity Shareholders from time to time. Such
refund orders would be payable at par at all places where the applications were originally accepted. The same
would be marked ‘Account Payee only’ and would be drawn in favour of the sole/ first Investor. Adequate funds
would be made available to the Registrar to the Issue for this purpose.
Our Company shall ensure at par facility is provided for encashment of refund orders or pay orders at the places
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where applications are accepted.
As regards allotment/refund to Non-residents, the following further conditions shall apply:
In the case of Non-resident Shareholders or Investors who remit their Application Money from funds held in
NRE/FCNR Accounts, refunds and/or payment of interest or dividend and other disbursements, if any, shall be
credited to such accounts, the details of which should be furnished in the CAF. Subject to the applicable laws
and other approvals, in case of Non-resident Shareholders or Investors who remit their application money
through Indian Rupee demand drafts purchased from abroad, refund and/or payment of dividend or interest and
any other disbursement, shall be credited to such accounts and will be made after deducting bank charges or
commission in US Dollars, at the rate of exchange prevailing at such time. Our Company will not be responsible
for any loss on account of exchange rate fluctuations for conversion of the Indian Rupee amount into US
Dollars. The Share Certificate(s) will be sent by registered post / speed post to the address in India of the Non
Resident Shareholders or Investors.
The Letter of Offer/ Abridged Letter of Offer and the CAF shall be dispatched to only such Non-resident
Shareholders who have a registered address in India or have provided an Indian address.
Payment of Refund
Mode of making refunds
The payment of refund, if any, would be done through any of the following modes:
(i) NECS – Payment of refund would be done through NECS for Investors having an account at any of
centres where such facility has been made available. This mode of payment of refunds would be
subject to availability of complete bank account details including the MICR code as appearing on a
cheque leaf, from the Depositories/ the records of the Registrar. The payment of refunds is mandatory
for Investors having a bank account at any centre where NECS facility has been made available
(subject to availability of all information for crediting the refund through NECS).
(ii) NEFT – Payment of refund shall be undertaken through NEFT wherever the Investors’ bank has been
assigned the Indian Financial System Code (IFSC), which can be linked to a MICR, allotted to that
particular bank branch. IFSC Code will be obtained from the website of RBI as on a date immediately
prior to the date of payment of refund, duly mapped with MICR numbers. Wherever the Investors have
registered their nine digit MICR number and their bank account number with the Registrar or with the
depository participant while opening and operating the demat account, the same will be duly mapped
with the IFSC Code of that particular bank branch and the payment of refund will be made to the
Investors through this method.
(iii) RTGS – If the refund amount exceeds ` 200,000, the Investors have the option to receive refund
through RTGS. Such eligible Investors who indicate their preference to receive refund through RTGS
are required to provide the IFSC code in the CAF. In the event the same is not provided, refund shall be
made through NECS or any other eligible mode. Charges, if any, levied by the refund bank(s) for the
same would be borne by the Company. Charges, if any, levied by the Investor’s bank receiving the
credit would be borne by the Investor.
(iv) Direct Credit – Investors having bank accounts with the Banker to the Issue shall be eligible to receive
refunds through direct credit. Charges, if any, levied by the relevant bank(s) for the same would be
borne by us.
(v) For all other Investors, the refund orders will be despatched through speed post/ registered post. Such
refunds will be made by cheques, pay orders or demand drafts drawn in favour of the sole/ first
Investor and payable at par.
(vi) Credit of refunds to Investors in any other electronic manner permissible under the banking laws,
which are in force and are permitted by the SEBI from time to time.
Refund payment to Non- resident
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Where applications are accompanied by Indian rupee drafts purchased abroad and payable at Mumbai, refunds
will be made in the Indian rupees based on the U.S. dollars equivalent which ought to be refunded. Indian
rupees will be converted into U.S. dollars at the rate of exchange, which is prevailing on the date of refund. The
exchange rate risk on such refunds shall be borne by the concerned applicant and our Company shall not bear
any part of the risk.
Where the applications made are accompanied by NRE/FCNR/NRO cheques, refunds will be credited to
NRE/FCNR/NRO accounts respectively, on which such cheques were drawn and details of which were provided
in the CAF.
Printing of Bank Particulars on Refund Orders
As a matter of precaution against possible fraudulent encashment of refund orders due to loss or misplacement,
the particulars of the Investor’s bank account are mandatorily required to be given for printing on the refund
orders. Bank account particulars, where available, will be printed on the refund orders/ refund warrants which
can then be deposited only in the account specified. We will in no way be responsible if any loss occurs through
these instruments falling into improper hands either through forgery or fraud.
Allotment advice/ Share Certificates/ Demat Credit
Allotment advice/ share certificates/ demat credit or letters of regret will be dispatched to the registered address
of the first named Investor or respective beneficiary accounts will be credited within 15 days, from the Issue
Closing Date. Allottees are requested to preserve such allotment advice (if any) to be exchanged later for share
certificates. In case our Company issues allotment advice, the respective share certificates will be dispatched
within one month from the date of the Allotment.
Upon approval of the Basis of Allotment by the Designated Stock Exchange, the Registrar to the Issue shall
send to the Controlling Branches, a list of the ASBA Investors who have been allocated Equity Shares in the
Issue, along with:
The amount to be transferred from the ASBA Account to the separate bank account opened by our
Company for the Issue, for each successful ASBA;
The date by which the funds referred to above, shall be transferred to the aforesaid bank account; and
The details of rejected ASBA applications, if any, to enable the SCSBs to unblock the respective ASBA
Accounts.
Option to receive Equity Shares in Dematerialized Form
Investors shall be allotted the Equity Shares in dematerialized (electronic) form at the option of the Investor. We
have signed a tripartite agreement with NSDL and the Registrar to the Issue on February 9, 2010 which enables
the Investors to hold and trade in Equity Shares in a dematerialized form, instead of holding the Equity Shares in
the form of physical certificates. We have also signed a tripartite agreement with CDSL and the Registrar to the
Issue on and February 1, 2010 which enables the Investors to hold and trade in Equity Shares in a
dematerialized form, instead of holding the Equity Shares in the form of physical certificates.
In this Issue, the allottees who have opted for Equity Shares in dematerialized form will receive their Equity
Shares in the form of an electronic credit to their beneficiary account as given in the CAF, after verification with
a depository participant. Investor will have to give the relevant particulars for this purpose in the appropriate
place in the CAF. Allotment advice, refund order (if any) would be sent directly to the Investor by the Registrar
to the Issue but the Investor’s depository participant will provide to him the confirmation of the credit of such
Equity Shares to the Investor’s depository account. CAFs, which do not accurately contain this information, will
be given the Equity Shares in physical form. No separate CAFs for Equity Shares in physical and/ or
dematerialized form should be made.
INVESTORS MAY PLEASE NOTE THAT THE EQUITY SHARES CAN BE TRADED ON THE STOCK
EXCHANGE ONLY IN DEMATERIALIZED FORM.
The procedure for availing the facility for Allotment of Equity Shares in this Issue in the electronic form is as
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under:
Open a beneficiary account with any depository participant (care should be taken that the beneficiary
account should carry the name of the holder in the same manner as is registered in our records. In the case
of joint holding, the beneficiary account should be opened carrying the names of the holders in the same
order as registered in our records). In case of Investors having various folios with different joint holders, the
Investors will have to open separate accounts for such holdings. Those Equity Shareholders who have
already opened such beneficiary account(s) need not adhere to this step.
For Equity Shareholders already holding Equity Shares in dematerialized form as on the Record Date, the
beneficiary account number shall be printed on the CAF. For those who open accounts later or those who
change their accounts and wish to receive their Equity Shares by way of credit to such account, the
necessary details of their beneficiary account should be filled in the space provided in the CAF. It may be
noted that the Allotment of Equity Shares arising out of this Issue may be made in dematerialized form even
if the original Equity Shares are not dematerialized. Nonetheless, it should be ensured that the depository
account is in the name(s) of the Equity Shareholders and the names are in the same order as in our records.
The responsibility for correctness of information (including Investor’s age and other details) filled in the
CAF vis-à-vis such information with the Investor’s depository participant, would rest with the Investor.
Investors should ensure that the names of the Investors and the order in which they appear in CAF should
be the same as registered with the Investor’s depository participant.
If incomplete/ incorrect beneficiary account details are given in the CAF, then such shares will be credited
to a demat suspense a/c which shall be opened by the Company as specified in the SEBI circular no.
SEBI/CFD/DIL/LA/1/2009/24/04 dated April 24, 2009.
The Equity Shares allotted to applicants opting for issue in dematerialized form, would be directly credited
to the beneficiary account as given in the CAF after verification. Allotment advice, refund order (if any)
would be sent directly to the applicant by the Registrar to the Issue but the applicant’s depository participant
will provide to the applicant the confirmation of the credit of such Equity Shares to the applicant’s
depository account. It may be noted that Equity Shares in electronic form can be traded only on the Stock
Exchanges having electronic connectivity with NSDL and CDSL.
Renouncees will also have to provide the necessary details about their beneficiary account for Allotment of
Equity Shares in this Issue. In case these details are incomplete or incorrect, the application is liable to be
rejected.
Non-transferable allotment advice/refund orders will be directly sent to the Investors by the Registrar.
Dividend or other benefits with respect to the Equity Shares held in dematerialized form would be paid to
those Equity Shareholders whose names appear in the list of beneficial owners given by the Depository
Participant to our Company as on the date of the book closure.
Investment by FPIs
SEBI recently notified the SEBI FPI Regulations whereby FIIs, sub-accounts and QFIs categories of investors
were merged to form a new category called ‘Foreign Portfolio Investors’. Prior to the notification of the SEBI
FPI Regulations, portfolio investments by FIIs and sub-accounts were governed by SEBI under the FII
Regulations and portfolio investments by QFIs were governed by various circulars issued by SEBI from time to
time (“QFI circulars”). Pursuant to the notification of the SEBI FPI Regulations, the FII Regulations were
repealed and the QFI circulars were rescinded.
Under the SEBI FPI Regulations, purchase of equity shares by an FPI or an investor group should be below 10%
of the total issued capital of an Indian company.
However, portfolio investments by FIIs and QFIs are also governed by RBI under FEMA and RBI has not yet
notified the corresponding amendments to regulations under FEMA. Under the FEMA regulations, no single FII
can hold more than 10% of the paid up capital of an Indian company. In respect of an FII investing on behalf of
its eligible sub-accounts, the investment on behalf of each eligible sub account shall not exceed 10% of the paid
up capital, or 5% of the paid up capital in case such eligible sub-account is a foreign corporate or an individual.
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The total equity share holding of all FIIs in a company is subject to a cap of 24% of the paid up capital of the
company. The 24% limit can be increased up to the applicable sectoral cap by passing a resolution by the board
of the directors followed by passing a special resolution to that effect by the shareholders of the company.
The individual and aggregate investment limits for Eligible QFIs in equity shares of a listed Indian company,
under the FEMA regulations, are 5% and 10%, respectively, of the paid up capital. Further, wherever there are
composite sectoral caps under the extant FDI policy, these limits for Eligible QFI investment in equity shares
shall also be within such overall FDI sectoral caps.
In light of the notification of FPI Regulations and the absence of any RBI notification on corresponding
amendments to regulations under FEMA, FIIs and Eligible QFIs should consult their advisors regarding the
investment limits applicable to them.
Under the FPI Regulations and subject to compliance with all applicable Indian laws, FPIs may issue, subscribe
or otherwise deal in offshore derivative instruments (defined under the FPI Regulations as any instrument, by
whatever name called, which is issued overseas by a FPI against securities held by it that are listed or proposed
to be listed on any recognized stock exchange in India, as its underlying security), directly or indirectly, only in
the event (i) such offshore derivative instruments are issued only to persons who are regulated by an appropriate
foreign regulatory authority; and (ii) such offshore derivative instruments are issued after compliance with
‘know your client’ norms. Further, Category II FPIs under the SEBI FPI Regulations which are unregulated
broad based funds and Category III FPIs under the SEBI FPI Regulations shall not issue, subscribe or otherwise
deal in such offshore derivative instruments directly or indirectly. In addition, FPIs are required to ensure that
further issue or transfer of any offshore derivative instruments by or on behalf of it is made only to person
regulated by an appropriate foreign regulatory authority.
Pursuant to a circular dated January 13, 2012, the RBI has permitted Eligible QFIs to invest in equity shares of
Indian companies on a repatriation basis subject to certain terms and conditions. Eligible QFIs have been
permitted to invest in equity shares of Indian companies which are offered to the public in India in accordance
with the SEBI Regulations.
Eligible QFIs shall open a single non-interest bearing Rupee account with an AD category-I bank in India for
routing the payment for transactions relating to purchase of equity shares (including investment in equity shares
in public issues) subject to the conditions as may be prescribed by the RBI from time to time.
Applications will not be accepted from FPIs in restricted jurisdictions.
FPIs which are QIBs, Non-Institutional Investors or whose application amount exceeds ` 2,00,000 can
participate in the Rights Issue only through the ASBA process. Further, FPIs which are QIB applicants and Non-
Institutional Investors are mandatorily required to use ASBA, even if application amount does not exceed ` 2,00,000.
Investment by NRIs
Investments by NRIs are governed by the Portfolio Investment Scheme under Regulation 5(3)(i) of the Foreign
Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000.
Applications will not be accepted from NRIs in restricted jurisdictions.
Only Applications accompanied by payment in Indian Rupees or freely convertible foreign exchange will be
considered for Allotment. Eligible NRIs intending to make payment through freely convertible foreign exchange
and applying on a repatriation basis could make payments through Indian Rupee drafts purchased abroad or
cheques or bank drafts or by debits to their Non-Resident External (“NRE”) or Foreign Currency Non-Resident
(“FCNR”) accounts, maintained with banks authorized by the RBI to deal in foreign exchange. Eligible NRIs
applying on a repatriation basis are advised to use the CAF meant for Non-Residents, accompanied by a bank
certificate confirming that the payment has been made by debiting to the NRE or FCNR account, as the case
may be. Payment for Applications by non-resident Applicants Applying on a repatriation basis will not be
accepted out of Non-Resident Ordinary (“NRO”) accounts.
Please note that pursuant to the applicability of the directions issued by SEBI vide its circular bearing number
CIR/ CFD/ DIL/ 1/ 2011 dated April 29, 2011, all applicants who are QIBs, Non-Institutional Investors or are
applying in this Issue for Equity Shares for an amount exceeding ` 200,000 shall mandatorily make use of
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ASBA facility, subject to their fulfilling the eligibility conditions to be an ASBA Investor. Further, all QIB
applicants and Non-Institutional Investors are mandatorily required to use ASBA, even if application amount
does not exceed ` 200,000, subject to their fulfilling the eligibility conditions to be an ASBA Investor.
Procedure for Applications by Mutual Funds
A separate application can be made in respect of each scheme of an Indian mutual fund registered with SEBI
and such applications shall not be treated as multiple applications. The applications made by asset management
companies or custodians of a mutual fund should clearly indicate the name of the concerned scheme for which
the application is being made.
Please note that pursuant to the applicability of the directions issued by SEBI vide its circular bearing number
CIR/ CFD/ DIL/ 1/ 2011 dated April 29, 2011, all applicants who are QIBs, Non-Institutional Investors or are
applying in this Issue for Equity Shares for an amount exceeding ` 200,000 shall mandatorily make use of
ASBA facility, subject to their fulfilling the eligibility conditions to be an ASBA Investor. Further, all QIB
applicants and Non-Institutional Investors are mandatorily required to use ASBA, even if application amount
does not exceed ` 200,000, subject to their fulfilling the eligibility conditions to be an ASBA Investor.
Procedure for Applications by AIFs, FVCIs and VCFs
The SEBI (Venture Capital Funds) Regulations, 1996, as amended (“SEBI VCF Regulations”) and the SEBI
(Foreign Venture Capital Investor) Regulations, 2000, as amended (“SEBI FVCI Regulations”) prescribe,
amongst other things, the investment restrictions on VCFs and FVCIs registered with SEBI. Further, the SEBI
(Alternative Investments Funds) Regulations, 2012 (“SEBI AIF Regulations”) prescribe, amongst other things,
the investment restrictions on AIFs.
As per the SEBI VCF Regulations and SEBI FVCI Regulations, VCFs and FVCIs are not permitted to invest in
listed companies pursuant to rights issues. Accordingly, applications by VCFs or FVCIs will not be accepted in
this Issue.
Venture capital funds registered as category I AIFs, as defined in the SEBI AIF Regulations, are not permitted
to invest in listed companies pursuant to rights issues. Accordingly, applications by venture capital funds
registered as category I AIFs, as defined in the SEBI AIF Regulations, will not be accepted in this Issue. Other
categories of AIFs are permitted to apply in this Issue subject to compliance with the SEBI AIF Regulations.
Such AIFs having bank accounts with SCSBs that are providing ASBA in cities / centres where such AIFs
are located are mandatorily required to make use of the ASBA facility. Otherwise, applications of such
AIFs are liable for rejection.
Impersonation
As a matter of abundant caution, attention of the Investors is specifically drawn to the provisions of sub-section
(1) of section 38 of the Companies Act, 2013 which is reproduced below:
“Any person who makes in a fictitious name an application to a Company for acquiring, or subscribing for,
any shares therein, or otherwise induces a Company to allot, or register any transfer of shares therein to him,
or any other person in a fictitious name, shall be punishable with imprisonment for a term which may extend
to five years”.
Payment by Stockinvest
In terms of RBI Circular DBOD No. FSC BC 42/ 24.47.00/ 2003-04 dated November 5, 2003, the Stockinvest
Scheme has been withdrawn. Hence, payment through Stockinvest would not be accepted in this Issue.
Disposal of application and application money
No acknowledgment will be issued for the application moneys received by us. However, the Banker to the Issue/
Registrar to the Issue/ Designated Branch of the SCSBs receiving the CAF will acknowledge its receipt by
stamping and returning the acknowledgment slip at the bottom of each CAF.
The Board reserves its full, unqualified and absolute right to accept or reject any application, in whole or in part,
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and in either case without assigning any reason thereto.
In case an application is rejected in full, the whole of the application money received will be refunded.
Wherever an application is rejected in part, the balance of application money, if any, after adjusting any money
due on Equity Shares allotted, will be refunded to the Applicant within a period of 15 days from the Issue
Closing Date. If there is a delay beyond 8 days from the stipulated period (i.e. 15 days from the closure of the
Issue) our Company shall be punishable with a fine which shall not be less than five lakh rupees but which may
extend to fifty lakh rupees and every officer of our Company in default shall be punishable with imprisonment
for a term of one year or with fine which shall not be less than fifty thousand rupees but may extend to three
lakh rupees or with both in accordance with Section 40 (5) of the Companies Act, 2013.
For further instructions, please read the CAF carefully.
Utilisation of Issue Proceeds
Our Board declares that:
1. all the moneys received out of the Issue, pursuant to an offer document shall be transferred to a separate
bank account;
2. details of all monies utilised out of the issue referred to in sub-item (a) shall be disclosed and continue to be
disclosed till the time any part of the issue proceeds remains unutilized under an appropriate separate head
in the balance sheet of the Company indicating the purpose for which such monies had been utilised;
3. details of all unutilised monies out of the issue of shares or debentures, if any, referred to in sub-item (a)
shall be disclosed under an appropriate separate head in the balance sheet of the Company indicating the
form in which such unutilised monies have been invested;
4. We shall not have recourse to the Issue proceeds until the basis of allotment is approved by the designated
stock exchange.
Undertakings by us
We undertake the following:
1. the complaints received in respect of the Issue shall be attended to by the Company expeditiously and
satisfactorily;
2. all steps for completion of the necessary formalities for listing and commencement of trading at all stock
exchanges where the equity shares are to be listed will be taken within seven working days of finalization of
basis of allotment;
3. funds required for making refunds to unsuccessful applicants as per the mode(s) disclosed in the draft letter
of offer and letter of offer shall be made available to the registrar to the issue by the Company;
4. where refunds are made through electronic transfer of funds, a suitable communication shall be sent to the
Investor within 15 days of the issue closing date, giving details of the bank where refunds shall be credited
along with amount and expected date of electronic credit of refund;
5. adequate arrangements shall be made to collect all ASBA applications and to consider them similar to non-
ASBA applications while finalising the basis of allotment;
6. that no further issue of securities shall be made till the securities offered through this offer document are
listed or till the application moneys are refunded on account of non-listing, under subscription, etc.;
7. at any given time there shall be only one denomination for the Equity Shares of our Company;
8. our Company shall comply with such disclosure and accounting norms specified by SEBI from time to
time;
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9. that the certificates of the securities or refund orders to the nonresident Indians shall be despatched within
specified time.
Minimum Subscription
If our Company does not receive the minimum subscription of 90% of the Issue, or the subscription level falls
below 90%, after the Issue Closing Date on account of withdrawal of applications, our Company shall refund
the entire subscription amount received within 15 days from the Issue Closing Date. If such money is not repaid
within a period of 30 days from the date of the Issue Closing Date, the application money has to be returned
within such period as may be prescribed. In the event of any failure to refund the application money within the
specified period, a penalty of ` 1,000 for each day during which the default continues or ` 100,000, whichever is
less as per Section 39(3) of the Companies Act, 2013.
Important
Please read the Letter of Offer carefully before taking any action. The instructions contained in the
accompanying CAF are an integral part of the conditions and must be carefully followed; otherwise the
application is liable to be rejected.
All enquiries in connection with the Letter of Offer or accompanying CAF and requests for SAFs must be
addressed (quoting the Registered Folio Number/ DP and Client ID number, the CAF number and the name
of the first Equity Shareholder as mentioned on the CAF and super scribed ‘JMC Projects (India)
Limited -Rights Issue’ on the envelope and postmarked in India) to the Registrar to the Issue at the
following address:
Link Intime India Private Limited
Pannalal Silk Mills Compound
L.B.S. Marg
Bhandup (West), Mumbai - 400 078
Maharashtra, India
Tel No.: +91 22 61715400
Fax No.: +91 22 2596 0329
Email: [email protected]
Investor Grievance E-mail: [email protected]
Website: www.linkintime.co.in
Contact Person: Mr. Dinesh Yadav
SEBI Registration: INR000004058
It is to be specifically noted that this Issue of Equity Shares is subject to the risk factors mentioned in section
titled “Risk Factors” on page 9 of the Letter of Offer.
The Issue will remain open for a minimum 15 days. However, the Board will have the right to extend the Issue
period as it may determine from time to time but not exceeding 30 days from the Issue Opening Date.
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MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION
The contracts referred to in para (A) below (not being contracts entered into in the ordinary course of business
carried on by us) which are or may be deemed material have been entered into by us.
The contracts together with the documents referred to in para (B) below may be inspected at the Registered
Office of the Company between 11.00 a.m. to 5.00 p.m. on any working day from the date of the Letter of Offer
until the closure of the subscription list.
(A) MATERIAL CONTRACTS
1. Issue Agreement dated September 22, 2015 between the Company and Inga Capital Private Limited
Lead Manager to the Issue.
2. Agreement dated September 19, 2015 between the Company and Registrar to the Issue.
3. Tripartite Agreement dated February 09, 2010 between the Company, National Securities Depository
Limited and Link Intime India Pvt Ltd.
4. Tripartite Agreement dated February 01, 2010 between the Company, Central Depository Services
(India) Limited and Link Intime India Pvt Ltd.
5. Banker to the Issue Agreement dated December 31, 2015 amongst our Company, the Lead Manager,
the Registrar to the Issue and the Banker to the Issue.
(B) DOCUMENTS FOR INSPECTION
1. Memorandum and Articles of Association.
2. Certificate of Incorporation of our Company and certificates of incorporation consequent upon changes
in the name of our Company.
3. Resolution of the Board of Directors under section 62(1) (a) of Companies Act, 2013 passed in its
meeting dated September 11, 2015 authorizing the Issue.
4. Consents of the directors, company secretary and Compliance Officer, Statutory Auditor, Lead
Manager to the Issue, legal advisor to the Issue and Registrar to the Issue to include their names in the
Letter of Offer to act in their respective capacities.
5. Annual reports of the Company for last 5 financial years.
6. The Report of the Auditors being, M/s Kishan M. Mehta & Co., Chartered Accountants, as set out
therein dated May 29, 2015 in relation to our audited financial information.
7. The Limited Review Report of the Auditors being, M/s Kishan M. Mehta & Co., Chartered
Accountants, as set out therein dated October 30, 2015 in relation to unaudited financial results for the
quarter ended September 30, 2015.The Limited Review Report of the Auditors being, M/s Kishan M.
Mehta & Co., Chartered Accountants, as set out therein dated January 2, 2016 in relation to unaudited
consolidated financial results for the six month ended September 30, 2015.
8. Statement of Tax Benefits dated December 23, 2015 by M/s Kishan M. Mehta & Co. Chartered
Accountants.
9. Due Diligence Certificate dated September 23, 2015 by Inga Capital Private Limited, Lead Manager to
the Issue.
10. In-principle listing approvals dated October 23, 2015 and October 08, 2015 from the BSE and the NSE,
respectively.
11. Observation letter no. WRO/AD/OW/35318/2015 dated December 22, 2015 received from SEBI.
203
12. Copy of letter of offer dated August 25, 2009 for the rights issue of equity shares by the Company.
13. Loan agreement dated September 11, 2015, between the Company and Amber Real Estate Limited.
14. Audited financial statements of Amber Real Estate Limited for the last 3 financial years.
15. Letter issued by RBI in relation to the renunciation of the Rights Entitlement i.e. letter no.
7761/10.21.358/2015-16 dated Janiuary 7, 2016.
Any of the contracts or documents mentioned in the Letter of Offer may be amended or modified at any time, if
so required, in our interest or if required by the other parties, without reference to the Equity Shareholders,
subject to compliance with applicable law.
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DECLARATION
We hereby certify that no statement made in the Letter of Offer contravenes any of the provisions of the
Companies Act, the SEBI Act and the rules made thereunder or regulations issued thereunder, as the case may
be. We further certify that all the legal requirements connected with the Issue as also the guidelines, instructions,
etc., issued by SEBI, the Government of India and any other competent authority in this behalf, have been duly
complied with. We further certify that all disclosures made in the Letter of Offer are true and correct.
Signed by the Directors of the Company
Name Signature
Devendra Raj Mehta
Chairman and Independent Director
Shailendra Kumar Tripathi Chief Executive Officer and Deputy Managing
Director
Shailendra Raj Mehta
Non - Executive & Independent Director
Mahendra Gulabrai Punatar
Non - Executive & Independent Director
Hemant Ishwarlal Modi Non - Executive Director
Anjali Karamnarayan Seth
Non – Executive Director
Manish Mohnot
Non Executive Director
Kamal Jain
Non –Executive Director
Signed by Chief Financial Officer of the Company
Manoj Tulsian Chief Financial Officer
Place: Mumbai
Date: January 14, 2016
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