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Your Directors are pleased to present the 5th Annual Report along with the audited financial statements of your Company for the financial year ended on 31st March, 2018.
Financial Performance Summary
The summarized financial highlight is depicted below:
( Rs in Crores)
|Particulars||Consolidated Results||Standalone Results|
|Total Expenditure other than Financial Costs and||1,118.47||892.62||840.71||784.63|
|Profit before Depreciation, Finance Costs and Tax||2,936.72||2,005.19||769.61||823.67|
|Depreciation and Amortization||579.41||569.25||0.08||0.05|
|Profit / (Loss) for the year before Taxation||1,471.68||531.93||(24.63)||4.88|
|Total Tax Expenses||328.74||115.50||-||1.03|
|Net profit/(loss) for the year (A)||1,142.94||416.43||(24.63)||3.85|
|Other Comprehensive Income|
|- Items that will not be reclassified to profit or loss||0.31||0.75||(0.06)||0.16|
|- Items that may be reclassified to profit or loss||(25.91)||(157.83)||(42.65)||(143.35)|
|Other Comprehensive Income (After Tax) (B)||(25.60)||(157.08)||(42.71)||(143.19)|
|Total Comprehensive Income for the year (C) = (A+B)||1,117.34||259.35||(67.34)||(139.34)|
|Add / (Less) Share of Minority Interest (D)||-||-|
|Net Profit / (Loss) for the year after Minority||1,117.34||259.35||(67.34)||(139.34)|
|Balance carried to Balance Sheet||1,117.34||259.35||(67.34)||(139.34)|
There are no material changes and commitments affecting the financial position of the Company between the end of the financial year and the date of this report.
Performance of your Company
Consolidated Financial Results
The audited consolidated financial statements of your Company as on 31st March, 2018, prepared in accordance with the relevant applicable IND AS and Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") and provisions of the Companies Act, 2013, forms part of this Annual Report.
The key aspects of your Companys consolidated performance during the financial year 2017-18 are as follows:
Your Company is the largest power transmission company operating in the private sector in India and owns, operates and maintains around 8,600 Ckt Kms of transmission lines ranging from 220 KV to 765 KV, with a total transformation capacity of around 14,000 MVA. Your Company has six fully operational Transmission Systems that primarily serve the Northern and Western regions of India and is also constructing additional projects of around 2500 Ckt Kms in Rajasthan, Chhattisgarh, Madhya Pradesh, Maharashtra, Jharkhand & Bihar, which were awarded through Tariff Based Competitive Bidding process. Construction of projects won under Tariff Based Competitive Bidding were well ahead of scheduled time of completion and within the budget. With completion of all ongoing projects and acquisitions, the network of the Company is expected to surpass 12,000 Ckt Kms. Your Company has recently entered the power distribution business by acquiring 100% stake in Reliance Energy which is engaged in power distribution in the city of Mumbai, India. It will service about 2.5 million households in Mumbai once it takes over the operations.
Your Companys operating performance in FY18 has set the best benchmark in the country in terms of consistent operational Network availability ranging from 99.83% to 100%. Your Company continues to pursue organic as well as inorganic growth opportunities. We have a strong & seamless integration of processes, people & technology which has laid a strong foundation for the Company to create long term value for its stakeholders.
Consolidated total income in FY18 was RS 4,055 Crore as compared to RS 2,898 Crore in FY17.
Consolidated EBIDTA in FY18 was RS 2,937 Crore as compared to RS 2,005 Crore in FY17.
Consolidated PAT in FY18 was up by 175% at RS 1,143 Crore as compared to RS 416 Crore in FY17.
Standalone Financial Results:
On standalone basis, your Company registered total revenue of RS 1,610 Crore in FY18 as compared to RS 1,608 Crore in FY17.
The detailed operational performance of your Company has been comprehensively discussed in the Management Discussion and Analysis Report which forms part of this Report.
In view of growth paradigm and accumulated losses on standalone basis, your Directors have not recommended any dividend on Equity Shares for the year under review.
During the year under review, the Authorised Share capital of the Company has been increased from RS 1100,00,00,000/- (Rupees One Thousand One Hundred Crores Only) to RS 1500,00,00,000/- (Rupees One Thousand Five Hundred Crores Only) divided into 150,00,00,000 Equity Shares of RS 10/- each by passing Special Resolution by the Members of the Company through Postal Ballot Process on 28th July, 2017.
During the year under review, your Company has not accepted any fixed deposits within the meaning of Section 73 of the Companies Act, 2013 and the rules made there under.
During the year under review, your Company has redeemed 2,500 Rated, Listed, Taxable, Secured, Redeemable, Non-Convertible Debentures of the face value of RS 10 Lakhs each issued on private placement basis.
As on 31st March, 2018, 31,650 Rated, Listed, Taxable, Secured, Redeemable, Non-Convertible Debentures of face value of RS 10 lakhs each aggregating to RS 3,165 Crores were outstanding as issued on private placement basis and listed on the Wholesale Debt Market Segment of BSE Limited.
Particulars of loans, guarantees or Investments
The provisions of Section 186 of the Companies Act, 2013, with respect to a loan, guarantee or security are not applicable to the Company as the Company is engaged in providing infrastructural facilities which is exempted under Section 186 of the Companies Act, 2013. The details of investments made by the Company during the year under review are disclosed in the financial statements.
Subsidiaries, Joint Ventures and Associate Companies
Your Company had 9 direct subsidiaries as on 31st March, 2017. During the year under review, the following companies were acquired.
Barmer Power Transmission Service Limited, Thar Power Transmission Service Limited and Hadoti Power Transmission Service Limited from Rajasthan Rajya Vidyut Prasaran Nigam Limited.
Western Transco Power Limited and Western Transmission (Gujarat) Limited from Reliance Infrastructure Limited.
Fatehgarh-Bhadla Transmission Limited from PFC Consulting Limited.
In view of the above, the total number of subsidiaries as on 31st March, 2018 was 15.
There are no associate companies or joint venture companies within the meaning of Section 2(6) of the Companies Act, 2013 ("Act"). There has been no material change in the nature of the business of the subsidiaries.
Pursuant to the provisions of Section 129, 134 and 136 of the Companies Act, 2013 read with rules framed thereunder and pursuant to Regulation 33 of the SEBI Listing Regulations, the Company had prepared consolidated financial statements of the company and its subsidiaries and a separate statement containing the salient features of financial statement of subsidiaries, joint ventures and associates in Form AOC-1 which forms part of the Annual Report.
The annual financial statements and related detailed information of the subsidiary companies shall be made available to the shareholders of the holding and subsidiary companies seeking such information on all working days during business hours. The financial statements of the subsidiary companies shall also be kept for inspection by any shareholder/s during working hours at the Companys registered office and that of the respective subsidiary companies concerned. In accordance with Section 136 of the Companies Act, 2013, the audited financial statements, including consolidated financial statements and related information of the Company and audited accounts of each of its subsidiaries, are available on our website, www.adanitransmission.com. Details of developments of subsidiaries of the Company are covered in the Managements Discussion and Analysis Report forms part of this Report.
Directors and Key Managerial Personnel
Mr. Laxmi Narayana Mishra, Whole-time Director (DIN: 01952408) resigned from the Directorship of the Company w.e.f. closure of business hours on 2nd May, 2018 due to pre-occupation. The Board places on record its sincere appreciation for the valuable contribution and guidance rendered by Mr. Laxmi Narayana Mishra during his tenure with the Company.
Mr. Anil Sardana (DIN: 00006867) was appointed as an Additional Director by the Board at its meeting held on 10th May, 2018. He was also appointed as a Managing Director and Chief Executive Officer of the Company subject to approval of members at the ensuing Annual General Meeting. As an Additional Director, he holds office upto the ensuing Annual General Meeting. The Company has received notice from a member under Section 160 of the Companies Act, 2013 proposing his appointment as a Director of the Company.
Pursuant to the provisions of Section 149 of the Companies Act, 2013, Mr. K. Jairaj, Dr. Ravindra H. Dholakia and Ms. Meera Shankar were appointed as Independent Directors at the Annual General Meeting of the Company held on 10th August, 2016. The terms and conditions of appointment of Independent Directors are as per Schedule IV of the Act. The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 and the SEBI Listing Regulations and there has been no change in the circumstances which may affect their status as independent director during the year.
Pursuant to the requirements of the Companies Act, 2013 and Articles of Association of the Company, Mr. Rajesh S. Adani (DIN: 00006322) is liable to retire by rotation and being eligible offers himself for re-appointment.
The Board recommends the appointment / re-appointment of above directors for your approval.
Brief details of Directors proposed to be appointed/re-appointed as required under Regulation 36 of the SEBI Listing Regulations are provided in the Notice of Annual General Meeting.
Directors Responsibility Statement
Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, state the following:
a. that in the preparation of the annual financial statements, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b. that such accounting policies have been selected and applied consistently and judgement and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st Mach, 2018 and of the profit of the Company for the year ended on that date; c. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. that the annual financial statements have been prepared on a going concern basis;
e. that proper internal financial controls were in place and that the financial control were adequate and were operating effectively;
f. that proper systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.
Number of Board Meetings
The Board of Directors met 5 (five) times during the year under review. The details of board meetings and the attendance of the Directors are provided in the Corporate Governance Report which forms part of this report.
Independent Directors Meeting
The Independent Directors met on 23rd March, 2018, without the attendance of Non-Independent Directors and members of the Management. The Independent Directors reviewed the performance of non-independent directors and the Board as a whole; the performance of the Chairperson of the Company, taking into account the views of Executive Directors and Non-Executive Directors and assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
The Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and individual Directors, including the Chairman of the Board. The exercise was carried out through a structured evaluation process covering various aspects of the Boards functioning such as composition of the Board & committees, experience & competencies, performance of specific duties & obligations, contribution at the meetings and otherwise, independent judgment, governance issues etc.
Policy on Directors Appointment and Remuneration
The Companys policy on directors appointment and remuneration and other matters provided in Section 178(3) of the Companies Act, 2013 is made available on the Companys website (http://www.adanitransmission.com/ Investor-relation/investor-download).
Internal Financial Control System and Their Adequacy
The details in respect of internal financial control and their adequacy are included in the Management and Discussion & Analysis, which forms part of this report.
The Board of the Company has formed a risk management committee to frame, implement and monitor the risk management plan for the Company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The audit committee has additional oversight in the area of financial risks and controls.
Committees of Board
Details of various committees constituted by the Board of Directors as per the provisions of the SEBI Listing Regulations and Companies Act, 2013 are given in the Corporate Governance Report which forms part of this report.
Corporate Social Responsibility & Sustainability
The Company has constituted a Corporate Social Responsibility & Sustainability (CSR&S) Committee and has framed a CSR Policy. The brief details of (CSR&S) Committee are provided in the Corporate Governance Report. The Annual Report on CSR activities is annexed to this Report. The CSR Policy is available on the website (http://www.adanitransmission.com/Investor-relation/ investor-download) of the Company.
Corporate Governance and Management Discussion and Analysis Report
Separate reports on Corporate Governance compliance and Management Discussion and Analysis as stipulated by the SEBI Listing Regulations forms part of this Annual Report along with the required Certificate from a Practising Company Secretory of the Company regarding compliance of the conditions of Corporate Governance as stipulated.
In compliance with Corporate Governance requirements as per the SEBI Listing Regulations, your Company has formulated and implemented a Code of Business Conduct and Ethics for all Board members and senior management personnel of the Company, who have affirmed the compliance thereto.
Business Responsibility Report
The Business Responsibility Report for the year ended 31st March, 2018 as stipulated under Regulation 34 of the SEBI Listing Regulations is annexed which forms part of this Annual Report.
Prevention of Sexual Harassment at Workplace
As per the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and rules made thereunder, your Company has constituted Internal Complaints Committee (ICC) which is responsible for redressal of complaints related to sexual harassment. During the year under review, there were no complaints pertaining to sexual harassment.
Extract of Annual Return
The details forming part of the extract of the Annual Return in Form MGT-9 are annexed to this Report as Annexure-A.
Related Party Transactions
All the related party transactions entered into during the financial year were on an arms length basis and were in the ordinary course of business. Your Company had not entered into any transactions with related parties which could be considered material in terms of Section 188 of the Companies Act, 2013. Accordingly, the disclosure of related party transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC 2 is not applicable.
During the year under review, your Company has entered into transactions with related party which are material as per Regulation 23 of the SEBI Listing Regulations and the details of the said transactions are provided in the Annexure to Notice of the Annual General Meeting.
Significant and Material Orders Passed by the Regulators or Courts or Tribunals Impacting the Going Concern Status of the Company
There are no significant and material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status and the Companys future operations.
The Company has taken appropriate insurance for all assets against foreseeable perils.
Auditors & Auditors Report
During the period under review, M/s. Dharmesh Parikh and Co., Chartered Accountants, Ahmedabad (Firm Registration No. 112054W) resigned as the Statutory Auditors of the Company w.e.f. 26th July, 2017 resulting into a casual vacancy in the office of Statutory Auditors of the company as envisaged by Section 139(8) of the Companies Act, 2013.
Based on the recommendation of the Audit Committee, the Board of Directors, vide circular resolution on 26th July, 2017, approved the appointment of M/s. Deloitte Haskins
& Sells LLP, Chartered Accountants (Firm Registration No. 117366W/W-100018) as a Statutory Auditors of the Company to fill the casual vacancy. Their appointment was subsequently approved by the Shareholders by passing Ordinary resolution through Postal Ballot, the results of which were declared on 31st August, 2017.
M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No. 117366W/W-100018) hold office as the Statutory Auditor of the Company until the conclusion of the ensuing 5th Annual General Meeting (AGM).
The Board of Directors of the Company at its meeting held on 10th May, 2018, on the recommendation of the Audit Committee, has made its recommendation for appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No 117366W/W-100018), as the Statutory Auditors of the Company for a term of 5 consecutive years, from the conclusion of 5th AGM of the Company till the conclusion of 10th AGM to be held in year 2023 for approval of shareholders of the Company. In this regard, the Company has received a certificate that they satisfy the criteria provided under Section 141 of the Companies Act, 2013 and that the appointment, if made, shall be in accordance with the applicable provisions of the Companies Act, 2013 and rules framed thereunder.
The Notes to the financial statements referred in the Auditors Report are self-explanatory and therefore do not call for any comments under Section 134 of the Companies Act, 2013. The Auditors Report is enclosed with the financial statements in this Annual Report.
Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the rules made thereunder, the Company has re-appointed M/s. Samdani Shah & Kabra, Company Secretaries to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for FY 2017-18 is annexed, which forms part of this report as Annexure-B. There were no qualifications, reservation or adverse remarks given by Secretarial Auditors of the Company.
Particulars of Employees
The information required under Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in separate annexure forming part of this Report as Annexure-C.
The statement containing particulars of employees as required under Section 197 of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, will be provided upon request. In terms of Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees particulars which is available for inspection by the members at the Registered Office of the Company during business hours on working days of the Company. If any member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of The Companies (Accounts) Rules, 2014, as amended from time to time is annexed to this Report as Annexure-D.
Your Directors are highly appreciative and grateful for all the guidance, support and assistance received from the Government of India, various State Governments, Financial Institutions and Banks. Your Directors thank all shareowners, esteemed customers, suppliers and business associates for their faith, trust and confidence reposed in the Company.
Your Directors also wish to place on record their sincere appreciation for the dedicated efforts and consistent contribution made by the employees at all levels, to ensure that the Company continues to grow and excel.
|For and on behalf of the Board of Directors|
|Place: Ahmedabad||Gautam S. Adani|
|Date: 10th May, 2018||Chairman|