bcpl railway infrastructure ltd share price Directors report


Dear Members,

Your Directors are pleased to present their report and financial statements for the year ended 31st March, 2022.

Financial Results

(In Rs Lacs)

Particulars 2021-22 2020-21
Profit before Exceptional Items, Depreciation, Finance cost and Tax 1179.92 1,335.05
Less: Depreciation and Amortisation expenses 15.88 18.46
Finance cost 108.47 243.01
Profit Before Tax 1055.57 1073.58
Less: Tax Expense 314.37 279.13
Profit After Tax 741.20 794.46
Add: Other Comprehensive Income (loss) 36.57 13.25
Total Comprehensive income 777.77 807.71
Key Ratios
Earnings per share (Rs) 4.43 4.75
Dividend per share (Rs) 0.70 0.70

Performance Highlights

Performance Highlights of the Company are as follows:

(In Rs Lacs)

Particulars FY 22 FY 21 Change
Revenue 10758.90 8,493.65 21.05%
EBIDTA 1179.92 1335.05 -13.14%
EBIDTA - % 10.97% 15.72%
Profit Before Tax 1055.57 1073.58 -1.68%
Profit After Tax 741.20 794.46 -6.70%

Operating Revenue

FY 22 began on a promising note with expectation of relief from the adversities of the Covid 19 pandemic. But from the middle of April the Corona cases started rapidly increasing. As a result of the re-emergence of the pandemic, business activities started getting decelerated. But inspite of the gloom, your Company has been able to achieve improvement in its top line amidst the bottlenecks created by uncertainties around the second and third wave of the pandemic in terms of continued supply chain disruptions and localised lock downs, because of the focussed approach adopted by the Management in targeting project completion. The inflationary trend in the global economy especially in ferrous and copper materials has resulted in dip in the margin. However, the Management has been able to sustain the adversities mainly on account price variation claims with the Railway Authorities.

The Management of the Company also successfully commenced the Merchant Export Business under which export of various agri commodities are being successfully executed.

Your Company has started execution of the work awarded by Military Engineering Services for transmission line works at CWE, Binnaguri, marking its presence in serving the defence sector of the Country. The Management of the Company is hopeful of garnering such works in a big way in the times to come considering the satisfactory progress of the work.

Further, continuing with its focus on working in the area of modernisation of electrical infrastructure, your Company has increased its focus on procuring works in the area of installation of smart meters in business and residential establishments. Your Company, has bagged an order for installation of smart meters at Rajarhat, Salt lake/New Town and Kalyani, West Bengal. This sector in the opinion of the Management is a sun rise sector and BCPL is fully geared to leave its mark on the same.

Shareholders Fund

Your Company has been able to keep increasing its members funds despite all challenges faced during the FY 22 due to the re-emergence of the Covid 19 pandemic. This has been made possible because of the extreme hard work, dedication and sincerity of the Companys work force, and efficient completion of Railway Electrification Projects.

Share Capital

The Authorised Share Capital of your Company as on March 31, 2022 stood at Rs180,000,000 divided into 18,000,000 equity shares of Rs10/- each. The Issued Share Capital of your Company is Rs167,236,380 divided into 16,723,638 equity shares of Rs10/- each and the subscribed and paid-up capital is Rs167,236,380 divided into 16,723,638 equity shares of Rs10/- each fully paid- up.

Earnings

Despite the pandemic and adversities your Company has been able to maintain EBIDTA margin of 10.97% during the FY 22.

The Management of the Company took the adversities in their stride and made all out efforts for improvement of the Companys operating efficiencies. This has been possible with the overall improvement in the productivity of the Companys work force and the initiatives taken by the Government of India to infuse liquidity through prompt release of payments by the Railways.

Dividends

The Board of Directors have recommended a final dividend of Rs 0.70 (7%) per equity share of Rs10 each for the financial year ended 31st March, 2022, subject to approval of shareholders. The outflow on account of dividend, if approved, would be Rs 117.06 lacs.

In terms of the provisions of Section 124 of the Act, till date no amount is due for transfer to the Investor Education and Protection Fund, in respect of dividend amounts lying unclaimed or unpaid for more than seven years from the date they became due.

Pursuant to the changes introduced by the Finance Act, 2020 in the Income-tax, Act 1961, the dividend paid or distributed by a Company shall be taxable in the hands of the shareholders. Accordingly, in compliance with the said provisions, your Company shall make the payment after necessary deduction of tax at source.

Management Discussion & Analysis

Review of Economic Scenario and outlook

The last two years have been difficult for the world economy on account of the COVID-19 pandemic. Repeated waves of infection, supply- chain disruptions and, more recently, inflation have created particularly challenging times for policy-making. Faced with these challenges, the Government of Indias immediate response was a bouquet of safety-nets to cushion the impact on vulnerable sections of society and the business sector. It next pushed through a significant increase in capital expenditure on infrastructure to build back medium-term demand as well as aggressively implemented supply-side measures to prepare the economy for a sustained longterm expansion.

As economic activity started showing signs of picking-up in the second year of the pandemic, the global economy faced the fresh challenge of rising global inflation. COVID-19 related stimulus spending in major economies along with pent-up demand boosting consumer spending pushed inflation up in many advanced and emerging economies. The surge in energy, food, non-food commodities, and input prices, supply constraints, disruption of global supply chains, and rising freight costs across the globe stoked global inflation during the year. Crude oil prices also witnessed an upswing during the year on the back of increased demand from recovering economies and supply restrictions by the Organization of the Petroleum Exporting Countries and its allies (OPEC+).

With the vaccination programme having covered the bulk of the population, economic momentum building back and the likely long-term benefits of supply-side reforms in the pipeline, the Indian economy is positioning itself to witness positive GDP growth in 2022-23. Nonetheless, the global environment still remains uncertain. A new wave in the form of the Omicron variant was sweeping across the world. Inflation had jumped up in most countries, and the cycle of liquidity withdrawal was being initiated by major central banks. This is why it is especially important to look at Indias macroeconomic stability indicators and their ability to provide a buffer against the above stresses.

The need for a strong and resilient social infrastructure became even more important during the ongoing COVID-19 pandemic that brought into focus the vulnerabilities in social infrastructure across countries. Specifically, the pandemic posed the challenge of balancing livelihoods while saving lives. To save lives and livelihoods amidst the COVID-crises, India, the country with the second largest population and a large elderly population, adopted a multipronged approach. Given the nature of the pandemic, the health response including vaccination strategy remained critical. India also faced the challenges of sustaining the learning outcomes in schools, building skills and reskilling population, employment and livelihood to one of the largest labour forces in the world. Governments response through Aatma Nirbhar Bharat Abhiyan packages and other sector specific initiatives have provided the necessary support to mitigate the adverse impact of the pandemic.

The Indian industry experienced an interlude in business activity leading to slowdown in its performance. With the gradual unlocking of the country, the supportive policy initiatives which included easing of supply side bottlenecks through easier access to credit, especially emergency credit line guarantee scheme to MSMEs, relief to the real estate sector, production-linked incentives for champion sectors and other direct tax measures, the industrial growth started to recover. In the past few months, record vaccinations as well as improvement in consumer demand and business confidence have had a positive impact on the performance of the industrial sector. This period also saw a boost to digital infrastructure, structural reforms in telecommunications and big-ticket disinvestment in Air India. The pace of this recovery and further growth is likely to continue due to consistent efforts of the government to bring in various structural, fiscal and infrastructural reforms in addition to a slew of measures/ schemes like the production linked incentive scheme (PLI) to support industries.

Despite facing the unprecedented COVID related challenges Indian railways (IR) has not only been able to move millions of people but has also been able to keep national supply chain running. Being the third largest network in the world under single management and with over 68,102 route kms IR strives to provide a safe, efficient, competitive and world class transport system. IR is also adopting indigenous new technology such as KAVACH, Vande Bharat trains and redevelopment of stations for safe and better journey experience. CAPEX has been increased substantially for IR from an average annual CAPEX during 2009-14 of Rs. 45,980 crores to Rs. 2,15,058 crores during 2021-22. IR is targeting for 100% electrification of its existing network by December 2023. In order to provide better amenities IR has embarked on providing Wi-Fi internet services at all stations (excluding halt stations). As on 5th December 2021, total 6,087 Railway Stations have been equipped with Wi-Fi facility. In addition to the above, projects connecting difficult terrain such as Rishikesh - Karnaprayag line as also the rail network to connect all capitals of north east states are ongoing.

The National Rail Plan lays down the road map for capacity expansion of the railway network by 2030 to cater to growth up to 2050. It envisages the creation of a future ready railway system that is able to not only meet the passenger demand but also increase the modal share of railways in freight to 40-45% from the present level of 2627%. The target of 40-45% modal share for railways is necessary from the perspective of sustainability and also from the national commitments made globally for reducing emission levels. The freight ecosystem is expected to grow from the present level of 4700 MT to 8200 by 2030. At present the railway capacity is barely able to carry 1220 MT which is around 26-27% of the modal share. The Plan provides a pipeline of projects, which on completion will increase railway capacity to capture 45% of freight traffic. Since the railways is already having a large number of sanctioned projects that need to be completed before taking up new projects, it has been planned to increase railway capacity in two surges. The first surge is to be provided by the Vision 2024 plan to prioritize and complete sanctioned projects so that railway capacity does not fall far behind the targeted modal share such that by the time capacity is finally created, the traffic would have shifted to another mode. To prevent further bleeding away of modal share, railway capacity enhancing projects have been categorized as Super Critical and Critical. 58 projects have been identified as Super Critical and are targeted for completion by December 2022. 68 projects have been identified as Critical and have been targeted for completion by March 2024. These projects are focussed at increasing capacity on routes that serve major mineral, industrial hubs along with ports and major consumption centres. In addition to these critical projects, the Ministry of Railway has also targeted 100% electrification of its network by December2023 upgrading Delhi-Mumbai & Delhi-Kolkata corridors to 160 kmph and also elimination of level crossings on the Golden Quadrilateral/Golden Diagonal routes. On completion of Vision 2024 projects, in the second half of the decade, the aim is to commission new Dedicated Freight Corridors and also High Speed Passenger Corridors, besides multitracking and signalling upgradation of congested routes The next 10 years will see a very high level of CAPEX in the railway sector as capacity growth has to be accelerated such that by 2030 it is ahead of demand. Up to 2014, CAPEX on railway was barely Rs 45,980 crore per annum and consequently the railway was characterized by high levels of inefficiency and highly congested routes unable to meet the growing demand. Post 2014, a conscious effort was made to improve the railway sector by substantially increasing the CAPEX. The CAPEX outlay for 2021-22 is Rs 2,15,000 crs which is more than five times the 2014 level. As more projects are taken on hand and several sources of capital funding are developed, the CAPEX will increase further in coming years and the railway system will actually emerge as an engine of national growth.

The Government has charted out a comprehensive programme for industrial transformation. With emphasis on supply side measures, the reforms address long known bottlenecks of insufficient infrastructure, tardy business processes and labour market reforms. Introduction of the production linked incentive schemes intends to encourage the scaling up of industries that are strategic in nature or are technology intensive. Initiatives under Atma Nirbhar Bharat including introduction of structural and procedural reforms, record vaccinations, various PLI scheme designed to attract investments in sectors of core competency and cutting edge technology, Make- in-India programme to boost domestic manufacturing capacity, reduction of corporate tax rate, etc and steps to improve operational efficiency have helped the industrial sector to keep up its ante. The sector has started to recover steadily.

Public Private Partnership in infrastructure has been an important source of investment in the sector. As per the database of the World Bank on private participation in infrastructure, India is ranked second among developing countries both by the number of PPP Projects as well as the associated investments. Much of the Indian success in PPPs is attributed to development of robust institutional structure, financial support, and use of standardized documents, both process documents like Model Request for Qualification and Model Request for Proposal as well as substantive documents like the Model Concession Agreements across infrastructure sectors.

Opportunities and Threats

A lot of emphasis is given to Railway Electrification in recent years with a view to reduce the Nations dependence on imported petroleum based energy and to enhance the countrys energy security, with a vision of providing eco-friendly, faster and energy efficient mode of transportation, keeping in mind the huge cost savings and considerable reduction in carbon foot print. Railways will develop new products and efficient logistics services for small farmers, and small and medium enterprises. It will also take steps towards integration of postal and railway networks to provide seamless solutions for movement of parcels. 100 PM- GatiShakti Cargo Terminals for multimodal logistics facilities will be developed over next three years. Multimodal connectivity between mass urban transport and railway stations will be facilitated on priority. 400 new-generation Vande Bharat trains will be manufactured over next three years. 2,000 km of network will be brought under Kavach, the indigenous technology for safety and capacity augmentation. One Station- One Product concept will be popularised to help local businesses and supply chains.

Aided by the Government policy and initiatives your Company foresees a very bright future for organisations which are providing dedicated services for the Railway Electrification Eco System.

Your Company faced the bottlenecks created by uncertainties around the second and third wave of the pandemic in terms of continued supply chain disruptions and localised lock downs. The inflationary trend in the global economy especially in ferrous and copper materials as well as increasing rates of freight has resulted in dip in the margin. However, the Management has been able to sustain the adversities mainly on account price variation claims with the Railway Authorities.

Further, with the re-emergence of pandemic, localised lock downs, the availability of labour and their movement from one site to another within India following the health protocols posed a challenge for the Company. However, your Company is expected to mitigate such problems through hedging strategies, efficient management and internal control system.

Companys Operations

Your Company has a pan India presence in executing electrification projects under Indian Railways. It has a strong order book position with path-breaking orders in the railway electrification segment received from Indian Railways as well as the Rail Vikas Nigam Limited (RVNL), Military Engineering Services (MES), WEBEL (West Bengal Electronics Industry Development Corporation Limited) and Tata Steel Limited.

Your Company has bagged order from MES at CWE, Binnaguri, marking its presence in serving the defence sector of the Country. And an order from WEBEL for installation of smart meters in business and residential establishments, which is expected to mark the entrance of the company as a new technological service provider in the coming days.

Your Company is quite enthused in updating its esteemed stakeholders about their recent success in completing a project in the last FY that was successfully inaugurated by the Honble Rail Minister, Shri Piyush Goyal, dedicating to the Nation, railway electrification project in Katwa- Azimganj and Monigram-Nalhati sections of Howrah and Malda Divisions.

Subsidiary Company - BCL Bio Energy Private Limited

Entry into Rice Bran Oil Extraction

Keeping in mind BCPLs objective of contributing to Indias foreign exchange reserves directly or indirectly, the Company has decided to enter the Rice Bran Oil sector for extracting oil from Rice Bran through the Solvent Extraction Process. The Project would contribute to Indias food energy and Foreign Exchange Reserves as the country is a net importer of edible oils. Further the residual cake after extraction of oil is widely exported from India to countries like Bangladesh, Vietnam. The total project cost has been envisaged at 46 Crores and the same is proposed to be met through a mixture of Debt and Equity under BCPLs subsidiary, BCL Bio Energy Private Limited. Land for the project has already been acquired at Burdwan, West Bengal. Details of subsidiary in Form AOC-1 is provided in Annexure 1.

Ethanol Project

The ethanol project is facing head winds in terms of rapidly increasing prices of grains like maize and rice, the raw materials for ethanol production, which may not be proportionately compensated through higher realisations. Under this backdrop the Management of BCL Bio Energy Private Limited has decided to adopt a wait & watch approach before progressing further in the project.

Consolidated Financial Statements

The duly audited Consolidated Financial Statements as required under the Indian Accounting Standard 110, provisions of Regulation 33 of the Listing Regulations and Section 136 of the Act have been prepared after considering the audited financial statements of your Companys subsidiaries and appear in the Annual Report of the Company for the year 202122.

Focus, Outlook and Future Projections

Your Company focus on Railway Electrification has been able to carve a niche for itself in the field, whereby it has become a highly acceptable partner for the Railways. This has been possible because of the Companys focus on efficient execution management system.

Your Company has started export of food products like maize, onions, oil cakes and other commodities to Bangladesh. This is a business having a very short working capital cycle which ensures higher Return on Equity of the Company. The promoters of the Company are highly experienced in the line of business and have been exporting for more than 20 years through its associate company. Your Company is expected to cater to the needs of the importing countries by supplying them standard products with adequate quality checks.

After getting the approval of the Board your Company has initiated the process of setting up an Edible oil production facility that would enable production of Rice Bran oil at Burdwan, West Bengal. The venture would be undertaken through the Companys subsidiary BCL Bio Energy Private Limited(BCL).

Project for extraction of Crude Rice Bran Oil from Rice Bran of 300 TPD and the residual cake called Deoiled Rice Bran. The Unit is envisaged in the Burdwan District of West Bengal about 100 kms from Kolkata. The promoters are well experienced in the trade of food grains through their export business of animal feed exports. Crude Rice Bran Oil is a high demand product and is readily saleable to oil refineries. The residual product Deoiled Rice Bran is exported to Bangladesh, Vietnam and various other countries. The project would be taken up in two phases. Phase I would be for extraction of Crude Oil only and the Phase II would be a forward integration phase wherein the crude oil would be refined for use as edible oil as a cooking medium. The project is viable considering the availability of raw material within the vicinity of the unit i.e. Burdwan District, West Bengal and the huge demand for Rice Bran Oil and Deoiled Rice Bran in the state of West Bengal. The unit is also capable of producing soya bean and rapeseed oil which are high value addition products.

The diversification would be in line with the Companys philosophy of contributing to the countrys Foreign Exchange through reduced outflows and dependence on imported oil and related price fluctuation, which leads to price inflation, thereby,

- Reducing significant burden on the governments exchequer due to its dependence on the international market for edible oils causing price volatility affecting both the consumers and producers.

- Encouraging use of Rice bran, a "little known" food which is highly nutritious and delivers a powerhouse of health supporting nutrients which is either thrown away or used for low-level animal feed.

- Promoting the nutritional composition of rice bran that has led the discovery of varied health benefits.

- Promoting rice bran to be used for the enrichment of foods, due to its high nutrient content.

- Encouraging use of Rice Bran Oil as a good source of unsaturated fats, vitamin E, and other important nutrient, thereby enhance health immunity and reduce risk of heart ailment.

- Reducing requirement of any new land for the production of oil seeds as Rice Bran is a by-product of rice after its milling, which is grown in abundance in Burdwan District of West Bengal and promote employment generation.

The construction activities on the project have already commenced and clearance from various Government department is steadily progressing. The project would be operational in around 9 months and its working is expected to be reflected in the accounts of FY23 onwards.

Risks and Concerns

The Management of the Company endeavours to identify elements of risk in different areas of operations and to develop mechanism for initiating actions required to mitigate the risks.

The Management on a timely basis informs the Board about risks that may threaten the existence of the Company and also about measures that they propose to take in order to mitigate the risks.

The Company has a Risk Management policy approved by the Audit Committee and the Board of Directors. The Policy provides a framework for identification of risks inherent in the business operations of the Company, and devises mitigation methods in a dynamic manner and on a continuous basis which are periodically reviewed and modified considering the size and complexity of the business and the regulatory as well as business requirements. The hedging policy laying down the technique, guidelines and procedures to mitigate the risk from high volatile as well as high value items forms part of the Risk Management policy. This hedging tool is devised for mitigating risk due to price fluctuation. The Risk Management Policy can be viewed at the following web link:

https://www.bcril.com/policies.php

With the entire world grappling with the effects of re-emergence of the Pandemic specially for the new Omicron variant, there were some uncertainties/ disruptions in the supply chains, availability of labour and their movement. Your Company continues to provide special attention to these areas requiring flexibilities of operation and quick decision making.

Impact of re-emergence of Covid 19

Your Company has been able to achieve improvement in its top line amidst the bottlenecks created by uncertainties around the second and third wave of the pandemic, because of the focussed approach adopted by the Management in targeting project completion. However, the Directors consider it necessary to record the latest position in this regard in their Report as under:

• Business: The business operations were impacted from the middle of April 2021 where the Corona cases started rapidly increasing. As a result of the re-emergence of the pandemic, business activities started getting decelerated. However, your Company being engaged in the activities of national importance, has been able to achieve improvement in its top line amidst the bottlenecks created by uncertainties around the second and third wave of the pandemic in terms of continued supply chain disruptions and localised lock downs, because of the focussed approach adopted by the Management in targeting project completion. Your Company has been continuously maintaining all measures of social distancing, health & hygiene protocols as per Government instructions at its registered office as well as at all work sites. Maintaining all social distancing protocols, we are in process of execution of our existing commitments.

Currently, most of our worksites are functioning, subject to local regulations and orders.

• Steps taken to ensure smooth and safe functioning of operations: All facilities are regularly sanitized as per the recommendations of the respective Governments to ensure that work conditions are safe. Recommendations of Covid appropriate behaviour relating to monitoring of employees body temperature, mandatory wearing of masks, enforcing social distancing, use of good hygiene practices have been implemented and are being adhered to.

• Employees: The safety of our employees are paramount and several measures have been undertaken to ensure their well-being and good health. Where possible, staggered shifts have been implemented to ensure minimum interaction and proper social distancing. Also we are increasing use of digital means in our business operations with our extant capacity through virtual meetings.

• Impact on capital and financial resources, cost reduction, assets, liquidity position, future operations: Your Companys capital and Banking facilities remain intact. There was a temporary impact in the revenue, however your Company faces no liquidity concerns since it had sufficient unutilised Banking limits and has also been granted additional credit limits under the Covid Emergency Scheme by the Bank in terms of the Government of Indias Atmanirbhar Policies.

Though the Company witnessed some temporary delay in its work in progress and receivable collection during the lockdown period, it has been able to manage its resources and ensure collection of its receivables from the Indian Railways. Further the Railways have taken the initiative of releasing the Bank Guarantees against the running projects in proportion to the works completed, thereby providing further impetus to your Companys finances.

Your Company has initiated cost reduction through optimal use of its existing resources to adjust to the new norms for business and is expected to come out of the pandemic and lockdown related challenges with improved efficiency and effectiveness in all aspects of the Companys operations.

Your Company does not expect a material impact of COVID 19 on the Companys liquidity and future performance, as of the date of the Directors Report.

• Existing Contracts/agreements: Your Company is well positioned to fulfil its obligations and existing contracts and arrangements.

• Non-fulfilment of obligations by any party:

Your Company does not foresee any eventuality which will have significant impact on the business in case of non-fulfilment of any obligations by any party.

Operational Efficiency

Your Company is constantly directing its efforts towards efficiency enhancement in all fronts starting from administrative office to project locations.

Your Company has also started various programmes for training the work force in achieving improvements in micro level efficiency through training and workshops.

Your Company also encourages leadership skills amongst its employees which have helped maintaining a loyal and efficient work force.

Though lock down procedures impacted the revenue of the company in the short term, with the help of better use of technology and staff productivity we hope to come out of the universal pandemic without a drastic negative impact.

Safety

Your Company has, as a policy, always strived to ensure safety and security of its work force. Safety is of paramount importance in our area of work and we, at BCPL, are ever focussed on improving the safety of our workers and the safety of lives. With a view to achieve this, your Company constantly organises training programmes for educating about the ways and means of working under strict safe conditions. Your Company procures the best safety gears comprising of helmets, safety belts and undertakes regular safety checks to ensure that the rules are followed. The Company has a dedicated safety officer to ensure compliance of the rules.

We have reviewed our health and safety policy and framed the rules as per the Covid appropriate behaviour directions of the Government of India. Your Company is taking utmost care of its staff and work force during the pandemic crisis period following all norms of vaccination, sanitization, social distancing, mandatory mask wearing, thermal check before entry and maintaining proper hygiene. Your company is strictly implementing the STAY SAFE AND ZERO TOLERENCE policy for prevention of the pandemic. We are increasing the use of digital means in our business operation through virtual meetings at all levels, be it internal and/or client or stakeholders meetings.

Quality Control

Your Company is aware about its responsibility in terms of delivery of safe Railway Electrification Eco System for the safety of lives and property that use the services of the Railways for meeting their transport requirements.

With a view to achieving the best standards in its construction efforts the Company has in place a system of checks and balances whereby the work performed by its employees is thoroughly checked by trained engineers in terms of safety standards set by the Railway Administration.

Further your Company has a system of identifying its vendors based on their credibility in terms of delivering quality products within committed time.

Your Company depends on vendors approved by RESEARCH DESIGNS & STANDARDS ORGANISATION (RDSO) for procuring equipment required in execution of projects. Considering the ambitious plans of the Government towards Railway Electrification, timely procurement may play out as a considerable risk in future. In order to mitigate the risk, your Company is constantly developing new vendor base so that any challenge on this front can be effectively dealt with in case an occasion for scarcity of supply of equipment arises.

Further the Board of Directors have laid down a standard procurement policy for ensuring the orderly and efficient conduct of its business. The Policy provides a framework for procurement of materials as may be required by issuing purchase orders pursuant to these standard terms and conditions, thereby devising mitigation methods for orderly supply chains and for operating standard negotiating terms. The Procurement Policy can be viewed at the following web link: https://www.bcril.com/policies.php.

Environment

The aim of your Company is to develop business while improving its environmental performance in order to create a more sustainable future. In order to achieve this, your Company continues to focus on measures for the conservation and optimal utilization of energy in all the areas of its operations. Work Sites are encouraged to consistently improve operational efficiencies, minimize consumption of natural resources and reduce water, energy consumption and carbon emissions while maximizing productivity.

Following the recommendations of Covid appropriate behaviour, employees in work sites are encouraged to ensure that social distancing and health and hygiene sanitisations are maintained.

Increasing the use of digital means in our business operation is encouraged by arranging virtual meetings at all levels, be it internal with the employees and work sites or Railway personnel, client or other stakeholders.

Health of Employees

Your Company recognises the importance of maintaining health of its employees who work away from home for considerable period of time. With a view to providing the best medical facilities to its employees, whenever required, your Company has tied up with Medical Insurance provider for its employees to avail the best medical attention without worrying about the cost.

With the outbreak of COVID19 attack, we have also learnt to be vigilant and be aware of health, hygiene and cleanliness at home and at work places. Your Company provided remote specialised training at various units through video conferencing on personal hygiene, safe work habits and best practices in sanitation and disinfection in the work place. Regular vigilance was also maintained to ensure that Covid appropriate behaviour are followed at the work place.

Your Company is taking utmost care of its staff and work force. Major Precautionary measures taken against COVID19 at all units of the Company

• Regular sanitization of office premises, godown, materials and vehicles.

• Full compliance with guidelines on usage of face covers/ masks, daily recording of temperature, social distancing, staggered attendance and hand sanitization facility.

• Vehicles are checked and sanitized during entry and self-declaration forms are being filled up by all outstation staff.

• Display of Posters for COVID19. Awareness at prominent places of all business units.

• Distribution of Masks, caps, hand sanitizers to all the employees.

Directors Responsibility Statement

Your Directors wish to inform that the Audited Accounts containing Financial Statements for the financial year ended 31st March, 2021 are in full conformity with the requirements of the Act.

They believe that the Financial Statements reflect fairly, the form and substance of transactions carried out during the year and reasonably present your Companys financial condition and results of operations.

Your Directors further confirm that in preparation of the Annual Accounts:

i) The applicable accounting standards have been followed and wherever required, proper explanations relating to material departures have been given,

ii) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period,

iii) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities,

iv) The Accounts have been prepared on a going concern basis,

v) The Directors have laid down internal financial controls to be followed by the Company and ensure that such internal financial controls are adequate and operating effectively,

vi) The Directors have devised proper systems to ensure proper compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Corporate Governance

Your Company re-affirms its commitment to the standards of corporate governance. This Annual Report carries a Section on Corporate Governance and benchmarks your Company with the relevant provisions of the Listing Regulations.

Pursuant to the Listing Regulations, as amended, a certificate obtained from a Practising Company Secretary certifying that the Directors of the Company are not debarred or disqualified from being appointed or to continue as directors of the companies by the Securities and Exchange Board of India/Ministry of Corporate Affairs, forms part of the report as Annexure 5 to the Corporate Governance Report.

In terms of Section 204 of the Act read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (as amended), your Board at its meeting held on 14th August, 2021 appointed Messrs Anjan Kumar Roy & Co., Company Secretaries (FCS-5684 CP No.4557) as the Secretarial Auditor to conduct audit of the secretarial records for the financial year ended 31st March, 2022 and to submit the Secretarial Audit Report.

The Secretarial Audit Report as received from Messrs Anjan Kumar Roy & Co., Company Secretaries in the prescribed Form No. MR-3 is annexed to this Boards Report and marked as Annexure 4.

An Annual Secretarial Compliance report as per Securities and Exchange Board of India circular dated 8th February, 2019 is also attached as Annexure 6 as an additional disclosure.

In terms of Regulation 34 of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter "Listing Regulations"), a Report on Corporate Governance along with Compliance

Certificate issued by Statutory Auditors of the Company is attached as Annexure 8 and forms integral part of this Report (hereinafter "Corporate Governance Report").

Secretarial Auditors and Secretarial Standards

Messrs Anjan Roy & Co., Practising Company Secretaries, have been appointed as the Secretarial Auditor of the Company with effect from 14th August, 2021. The report of the Secretarial Auditor is enclosed to this report and forms part of this report.

During the year under review, the Company has duly complied with the applicable provisions of the Secretarial Standards on meetings of the Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company Secretaries of India (ICSI).

Policy on Appointment and Remuneration of Directors and Key Managerial Personnel

The Company has formulated a Remuneration Policy pursuant to the provisions of Section 178 and other applicable provisions of the Act and Rules thereof. There has been no change in the said policy during the financial year ended 31st March, 2022. The Policy is available at the following web link: www.bcril.com/policies.php

Qualification or Reservations in the Statutory/Secretarial Audit Reports

Your Board has the pleasure in confirming that no qualification, reservation, adverse remark or disclaimer has been made by the Statutory Auditors and the Company Secretary in Practice in their Audit Reports issued to the members of the Company. However, the Secretarial Audit report specifies that a condonation of delay in efiling of an MCA form is pending with the Ministry of Corporate Affairs. Your company will accordingly file the same after condonation of delay is approved by the appropriate authority.

Directors and Key Managerial Personnel

Your Companys Board is duly constituted and in compliance with the requirements of the Act, the Listing Regulations and provisions of the Articles of Association of the Company. Your Board has been constituted with requisite diversity, wisdom, expertise and experience commensurate to the scale of operations of your Company.

Composition of Board

The Board comprises 8 Directors of which, 3 are Executive Directors (2 of whom are part of the promoter group), 1 is Non-Executive (part of the promoter group) and 4 are Non-Executive, Independent Directors. The composition of the Board is in conformity with Regulation 17 of the Listing Regulations read with Section 149 of the Act.

Structure of the Board of Directors

Name of Di ector Executive/ Non-Executive Inde pend ent Lady
Aparesh Nandi Non-Executive No No
Jayanta Kumar Ghosh Executive No No
Uday Narayan Singh Executive No No
Debasis Sircar Executive No No
Sanghamitra Mukherjee Non-Executive Yes Yes
Swapan Kumar Chakraborty Non-Executive Yes No
Sudipta Kumar Mukherjee Non-Executive Yes No
Ranajit Kumar Mondal Non-Executive Yes No

Meetings of the Board

During the year 2021-2022, the Board of Directors met 5 (Five) times. For details of the meetings of the Board of Directors, please refer to the Corporate Governance Report.

Changes in Board Composition

Details of Directors appointment/reappointment and change in board composition during the financial year under review are as follows:

Name of Director Designation & Category Reason and date of appointment/reappointment/ retirement/ resignation
Mr Aparesh Nandi Mr Aparesh Nandi (DIN:00722439), NonExecutive Chairman, Non-
Non-Executive Chairman/ Promoter (NonIndependent) Independent Director of the Company retired by rotation and was re-appointed pursuant to Section 152(6) of the Act at the 25th Annual General Meeting held on 12th August, 2021. He is due to retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment pursuant to Section 152(6) of the Act.
Mr Ranajit Kumar Mondal Mr Ranajit Kumar Mondal (DIN-09022104) was appointed as a Non-Executive
Non-Executive - Independent Director - Independent Director for a period of five consecutive years with effect from 14th August, 2021 as per Sections 149 and 160 of the Act. Based on the recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company approved the appointment Ranajit Kumar Mondal as an Additional Director of the Company with effect from 14th August, 2021 to hold office as a NonExecutive, Independent Director of the Company for a term of 5 (five) consecutive years, subject to approval of the Members of the Company at the ensuing AGM. The Company has received a Notice under Section 160 of the Act from a Member of the Company signifying the candidature of Mr Mondal for his appointment as a Director of the Company at the ensuing AGM. Your Board recommends appointment of Mr Mondal as a NonExecutive, Independent Director of the Company for a term of 5 (five) consecutive years commencing from 14th August, 2021.

In the opinion of the Board, the Independent Directors possess the attributes of integrity, expertise and experience as required to be disclosed under Rule 8(5)(iiia) of the Companies (Accounts) Rules, 2014 (as amended).

The following are the independent directors of the Company:

1. Dr Sanghamitra Mukherjee

2. Mr Swapan Kumar Chakraborty

3. Mr Sudipta Kumar Mukherjee

4. Mr Ranajit Kumar Mondal (appointed on 14th August, 2021)

The Company has received declarations from Independent Directors that they meet the criteria of independence as prescribed u/s 149(6) of the Companies Act, 2013 and as required under the Listing Regulations. In the opinion of the Board, they fulfil the condition for appointment/ reappointment as Independent Directors on the Board.

The Board of Directors confirms that the Independent Directors have affirmed compliance with the Code for Independent Directors as prescribed in Schedule IV to the Act and also with the Companys Code of Conduct applicable to all the Board Members and Senior Management Personnel of the Company for the financial year ended on 31st March, 2022.

The Company arranges detailed presentation on various business aspects to ensure familiarising the Independent directors about the different aspects of the prevailing business environment, economy, performance of the Company and its strategies.

Statement of Evaluation of Board of Directors and Committees thereof

Your Company understands the requirements of an effective Board Evaluation process and accordingly conducts the Performance Evaluation every year in respect of the following:

i. Board of Directors as a whole.

ii. Committees of the Board of Directors.

iii. Individual Directors including the Chairman of the Board of Directors.

In compliance with the requirements of the provisions of Section 178 of the Act, the Listing Regulations and the Guidance Note on Board Evaluation issued by SEBI, your Company has carried out a performance evaluation process internally for the Board/Committees of the Board/Individual Directors including the Chairman of the Board of Directors for the financial year ended 31st March, 2022.

The key objectives of conducting the Board Evaluation process were to ensure that the Board and various Committees of the Board have appropriate composition of Directors and they have been functioning collectively to achieve common business goals of your Company. Similarly, the key objective of conducting performance evaluation of the Directors through individual assessment and peer assessment was to ascertain if the Directors actively participate in the Board/Committee Meetings and contribute to achieve the common business goals of the Company. The Directors carry out the aforesaid performance evaluation in a confidential manner and provide their feedback on a rating scale of 1-5.

This year also, the outcome of such performance evaluation exercise was discussed at a separate Meeting of the Independent Directors held on 29th March, 2022 and was later tabled at the Board Meeting held on 30th May, 2022. After completion of internal evaluation process, it was noted that the Board and the Committees are working effectively.

Pursuant to Section 178(3) of the Act and Regulation 17(6) of the Listing Regulations, the Remuneration Committee is entrusted with responsibility of formulating criteria for determining qualifications, positive attributes and independence of an independent director. This can be viewed at

https://www.bcril.com/policy.php

Committees of the Board

A. Audit Committee

The Board of Directors of your Company has duly constituted an Audit Committee in compliance with the provisions of Section 177 of the Act, the Rules framed thereunder read with Regulation 18 of the Listing Regulations. The terms of reference of the Audit Committee have been duly approved by the Board of Directors.

During the year under review, the Audit Committee comprised Independent Directors, namely, Mr. Sudipta Kumar Mukherjee (Chairman), Mr. Swapan Kumar Chakraborty (Member) and Mr. Uday Narayan Singh, Executive Director & CFO. Powers and role of the Audit Committee are included in Corporate Governance Report. All the recommendations made by the Audit Committee were accepted by the Board of Directors.

Whistle Blower Policy

In terms of the provisions of Section 177 of the Act and the Rules framed therein read with Regulation 22 of the Listing Regulations, your Company has a vigil mechanism in place for directors and employees of the Company through which genuine concern regarding various issues relating to inappropriate functioning of the organisation can be raised. The Whistle Blower Policy has been uploaded in the website of the Company at www.bcril.com/policies.php

The Vigil Mechanism of your Company is governed by the Whistle Blower Policy Mechanism, which provides for adequate safeguards against victimization of director(s)/ employee(s) who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases.

C. Nomination and Remuneration Committee

The Company has a Nomination & Remuneration Committee. The details of the committee are given in the Report on Corporate Governance - Annexure 7.

C. Stakeholders Relationship and Investor Grievance Committee

The Company has a Stakeholders Relationship and Investor Grievance Committee. The details of the committee are given in the Report on Corporate Governance - Annexure 7.

D. Corporate Social Responsibility Committee

The Company has a Corporate Social Responsibility Committee. The details of the committee are given in the Report on Corporate Governance - Annexure 7. A report on the CSR activities/initiatives undertaken by the Company is provided in Annexure 2.

Your Company has spent an amount of Rs13.10 lacs towards donation to other institutions during the financial year 2021-2022. Your Directors have set up a new company BRIL Social Foundation and transferred earmarked amount of Rs45.39 lacs which would be directly used for the CSR activities and the CSR committee will finalise the mode of disbursement and utilization of the amount. As such total amount spent on CSR is Rs58.49 lacs during the year 2021-22 as against its 2% obligation amounting to Rs 22.43 lacs, thereby utilising the unspent amount of the previous financial years that could not be utilised due to the pandemic. The Corporate Social Responsibility Policy has been uploaded in the website of the Company at

www.bcril.com/policies.php

Prevention of Sexual Harassment

Your Company had framed a policy on Prevention of Sexual Harassment of Women at workplace pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 which commits to provide a workplace that is free from all forms of discrimination, including sexual harassment. The Policy can be viewed at the following weblink: www.bcril.com/polies.php

Pursuant to 134(3)(q) read with the Companies (Accounts) Rules, 2014, the Company has complied with the provisions relating to constitution of Internal Complaint Committee (ICC) under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. As per the Policy, any complaint received shall be forwarded to an Internal Complaint Committee ("ICC") formed under the Policy for redressal. The investigation shall be carried out by ICC constituted for this purpose. From the date of inception, there has been no such complaint received.

Familiarization Programme of Independent Directors

The Company believes that the best training is imparted when dealing with actual roles and responsibilities on the job. To this extent, the Company arranges detailed presentation by Key Functional Heads on various aspects including the business environment, economy, performance of the Company, industry scenario, financial controls, the Companys strategy, safety policy and practices at work sites etc. Visits to the Companys works are also undertaken from time to time. Details of Familiarization Programmes imparted during the year under review has been available at the following weblink:

https://www.bcril.com/compliance.php

Business Responsibility

Creating shared value is your Companys fundamental way of working and contributing to society while ensuring long-term business success. Your Company has been conducting business in a way that delivers long-term shareholder value and benefits to society.

Statutory Auditors

Messrs. L B Jha & Co., Chartered Accountants was appointed as Statutory Auditors of the Company in the 25th AGM held on 12th August 2021 for a period of 5 years till 2025-26.

The report of the Statutory Auditors M/s. L B Jha & Co. alongwith notes to Schedules is enclosed with this report. The observations made in the Auditors Report are self-explanatory and therefore do not call for any further comments.

With regard to the issue of non-preparation of accounts of the Joint Ventures for the FY 202122, the Board has analysed the matter and does not foresee any material impact on the finances of the Company once the accounts are available.

Listing with Stock Exchanges

Your Company is listed with BSE Limited and has paid the listing fees to the Exchange. Your Company was listed with the SME Exchange of BSE Limited and was migrated to the main board of the BSE Limited on the 4th January, 2021. The address of the Stock Exchange and other information for shareholders are given in this Annual Report.

Cost Accounts and Cost Auditors

Cost audit applicability provisions are contained under rule 4 of the Companies (Cost Records and Audit) Rules, 2014 are not applicable to the Company. Hence no cost accounts are required to be maintained nor are Cost Auditors required to be appointed by the Company.

Details of Loans and Investments

Details of the loans given by your Company under Section 186 of the Act during the financial year ended 31st March, 2022 are as follows:

Phoenix Overseas Limited - Related Company with common promoters - Guarantee Given against loan from Bank of India amounting to Rs 36.09 Crores.

Related Party Transactions

The Company has always been committed to good corporate governance practices, including in matters relating to Related Party Transactions (RPTs). Endeavour is consistently made to have only arms length transactions with all parties including Related Parties.

The Board of Directors of the Company had adopted the Related Party Transaction policy regarding materiality of related party transactions and also on dealings with Related Parties in terms of Regulation 23 of the Listing Regulations and Section 188 of the Act. The policy is available at the following weblink: https://www.bcril.com/policies.php

All related party transactions have been carried out at arms length basis in the ordinary course of business. There is material related party transaction i.e. transaction exceeding 10% of the annual consolidated turnover as per the last audited financial statements of the Company during the year by your Company. Accordingly, the disclosure of Related Party Transaction as required under Section 134(3)(h) of the Act in Form AOC-2 is provided in Annexure 1. Members may refer to notes no.35 to the financial statement which sets out related party disclosures.

Policy on Appointment and Remuneration of Directors, Key Managerial Personnel and other Employees

The Company has formulated a Remuneration Policy pursuant to the provisions of Section 178 and other applicable provisions of the Act and Rules thereof. The policy is based on the guiding principle aimed towards retaining and rewarding performers. There has been no change in the said policy during the financial year ended 31st March, 2022. The Policy is available at the following weblink: www.bcril.com/policies.php

Policy to Determine Material Events

As per the Listing Regulations, the Company has framed a policy for determination of materiality, based on criteria specified in the Regulations. The Policy is available at the following web link: https://www.bcril.com/policies.php

Policy for Preservation of Documents

As per Regulation 9 of Listing Regulations, the Company has framed a policy for Preservation of Documents, based on criteria specified in the said Regulations. The Policy is available at the following web link:

https://www.bcril.com/policies.php

Significant Changes

During the financial year 2021-2022, no significant change has taken place which could have an impact over the financial position of the Company.

Public Deposits

Your Company has not accepted any Public Deposits under Chapter V of the Companies Act, 2013.

Extract of the Annual Return

The Annual Return of the Company in Form MGT7 in accordance with Section 92(3) of the Act, read with Companies (Management and Administration) Rules, 2014 (as amended), is available on the website of the Company at https://www.bcril.com/annualreport.php. As per the notification of the MCA dated 28th August, 2020 is not required to annex to this Report as such the same is not attached in this report and available at the aforesaid weblink.

Significant and Material orders passed by the Regulators/Courts/ Tribunals

Pursuant to Section 134(3)(q) of the Act read with Companies (Accounts) Rules, 2014, it is stated that no significant or material orders were passed by the Regulators or Courts or Tribunals which impacts the going concern status and Companys operations in future.

There is no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year to which the financial statements relates and the date of the report.

Internal Controls and their adequacy

Your Companys Internal Control Systems are commensurate with the nature, size and complexity of its business. The Board of Directors have laid down internal financial control measures to be followed by the Company and such procedures have been adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information. Good governance, well defined systems and processes, risk assessment, a vigilant control function, communication and monitoring and an independent internal audit function are the foundation of the internal control systems. Internal Audit department provides assurance on functioning and quality of internal controls along with adequacy and effectiveness through periodic reporting. Internal Risk and Control function also evaluates organisational risk along with controls required for mitigating those risks. The control activities include continuous monitoring, routine reporting, digital business environment with minimum possible interference, checks and balances, purchase policies, authorization and delegation procedures, audits including compliance audits, which are periodically reviewed by the Audit Committee. Your Company has a Code of Conduct for all directors and senior management and a clearly articulated and internalized delegation of financial authority. Your Company also takes prompt action on any violations of the Code of Conduct. The Code of Conduct for directors and senior management can be viewed at the following web link: https://www.bcril.com/policies.php.

Internal Financial Controls and their adequacy

The Directors had laid down internal financial controls to be followed by your Company and such policies and procedures adopted by your Company for ensuring the orderly and efficient conduct of its business, including adherence to your Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information. The Audit Committee evaluates the internal financial control system periodically.

Information regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The Companys activities during the year do not entail disclosure with respect to conservation of energy, technology absorption, etc. in accordance with the provisions of Section 134(3)(m) of the Company Act, 2013. The Companys foreign exchange earnings is Rs 2737.77 lacs and no foreign exchange outgo is recorded for the FY22.

Information regarding Employees and related disclosures

In terms of the provisions of Section 197(12) read with Rule 5(2) and 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 particulars of certain category of employees have been set out in Annexure 3 of this report.

Your Company considers people as its biggest assets and Believing in People is at the heart of its human resource strategy. Concerted efforts have been put in talent management, and strong performance management and learning and training initiatives to ensure that your Company consistently develops inspiring, strong and credible leadership. Your Company also organises employee felicitation events wherein well performing employees are rewarded. Inspite of the challenges faced by the employees during this pandemic period, they had cooperated in all aspects for the benefit of the Company.

The statement of Disclosure of Remuneration under Section 197 of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 ("Rules"), is appended as Annexure - 3 to the Report. The information as per Rule 5(2) of the Rules, forms part of this Report.

Ratio of remuneration of Director or Key Managerial Personnel to the median of the employees:

Name of Director /KMP Remunera tion Ratio as to that of the median employee Percen tage increas e in remun eratio n
Mr Jayanta Kumar Ghosh 50,82,112 12.70:1 25.66
Mr Uday Narayan Singh 40,81,112 10.20:1 29.57
Mr Debasis Sircar 25,40,160 6.35:1 97.28
Ms Devshree Sinha 8,34,195 2.08:1 9.25

Note: The median employee remuneration for 2021-22 is Rs 4,00,104/-.

Cautionary Statement

Statements in this Report, particularly those which relate to Management Discussion and Analysis, describing the Companys objectives, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Actual results might differ materially from those either expressed or implied in the statement depending on the circumstances.

Appreciation

Your Company has been able to operate efficiently because of the culture of professionalism, creativity, integrity and continuous improvement in all functions and areas as well as the efficient utilization of the Companys resources for sustainable and profitable growth.

Your Directors hereby wish to place on record their appreciation for the undaunted efforts inspite of the challenges faced by the employees during the pandemic. Your Directors also wish to place on record their appreciation for the efficient and loyal services rendered by each and every employee, without whose whole-hearted efforts, the overall satisfactory performance would not have been possible. The Industrial Relations were generally satisfactory during the year. Your Company wishes to put on record its deep appreciation of the cooperation extended and efforts made by all employees. Your

Directors look forward to the long term future with confidence.

Your Company continued to receive co-operation and unstinted support from the Railways, Suppliers, and others associated with the Company as its business partners. The Directors wish to place on record their appreciation for the same and your Company will continue in its endeavour to build and nurture strong links with concerned parties, based on mutuality, respect and co-operation with each other and consistent with National interest.

On behalf of the Board of Directors
Jayanta Kumar Ghosh Managing Director
Uday Narayan Singh Executive Director & CFO
Date - 30/05/2022
Place - Kolkata