bharat road network ltd share price Directors report

Dear Members,

Your Directors have the pleasure in presenting the Sixteenth Annual Report, together with the Audited Accounts of your Company, for the Financial Year ended on 31st March, 2023. The summarized financial performance of your Company is as under:

FINANCIAL SUMMARY / HIGHLIGHTS:

				(Rs. In Lakhs)
Particulars	Standalone	Consolidated
	Financial Year 2022-23	Financial Year 2021-22	Financial Year 2022-23	Financial Year 2021-22
Revenue from Operations	2,673.79	9,124.20	32,633.93	21,639.65
Other Income	213.83	440.96	2,374,97	1032.88
Total Income	2,887.62	9,565.16	35,008.90	22,672.53
Profit/(loss) before Depreciation, Finance Costs, Exceptional items and Tax Expense	(3,859.46)	(1,814.24)	3,653.14	9,794.19
Less: Depreciation & Amortisation	7.01	6.13	5,676.49	4,289.79
Profit/(loss) before Finance Costs, Exceptional items and Tax Expense	(3,866.47)	(1,820.37)	(2,023.35)	5,504.40
Less: Finance Costs	(3,082.07)	2,746.32	18,388.95	18,214.21
Profit /(loss) before share of Profit/(Loss) of Associates, Exceptional items and Tax Expense	(6,948.54)	(4,566.69)	(20,412.30)	(12709.81)
Share of Profit / (loss) of Associates	–	–	(849.58)	(13,733.18)
Add/(less): Exceptional items	(2,767.44)	(29,547.63)	(961.28)	(14318.05)
Profit /loss before Tax Expense	(9,715.98)	(34,114.32)	(22,223.16)	(40,761.04)
Less: Tax Expense (Current & Deferred)	(1,698.63)	(1,894.25)	(1698.63)	(1894.25)
Profit /loss for the year (1)	(8,017.35)	(32,220.07)	(20,524.53)	(38,866.79)
Total other Comprehensive Income/loss (2)	(21.30)	(7.61)	49.35	18.55
Total (1+2)	(8,038.65)	(32,227.68)	(20,475.18)	(38,848.24)
Profit / (Loss) for the year attributable to:
Owners of the Company	–	–	(20,957.66)	(37,631.73)
Non-Controlling Interest	–	–	433.13	(1,235.06)
Other Comprehensive Income for the year attributable to:
Owners of the Company	–	–	32.50	14.96
Non-Controlling Interest	–	–	16.85	3.59
Total Comprehensive Income for the year attributable to:
Owners of the Company	–	–	(20,925.16)	(37,616.77)
Non-Controlling Interest	–	–	449.98	(1,231.47)
Balance brought forward from the previous year	(32,111.97)	115.72	(66,670.25)	(29,053.48)
Profit/(Loss) available to Owners for appropriation	(8,017.35)	(32,220.07)	(20,957.66)	(37,631.73)
Appropriations:	–	–
Dividend	–	–	–	–
Tax on Dividend	–	–	–	–
Adjustment for Other Comprehensive Income: Gain/(Loss)	(21.30)	(7.61)	32.50	14.96
Balance carried to Balance Sheet	(40,150.63)	(32,111.97)	(87,595.41)	(66,670.25)

During the year under review, on a standalone basis, your Company suffered Net Loss before tax of Rs. (9,715.98) Lakhs, as against Net loss of Rs. (34,114.32) Lakhs in the previous Financial Year due to loss on sale of equity investments in one of its Associate Companies. The Gross Revenue during the current Financial Year decreased to Rs. 2,887.62 Lakhs as against Rs. 9,565.16 Lakhs in the previous Financial Year due to decrease in construction revenue.

On a consolidated basis, during the year under review, your Company suffered net loss of Rs. (22,223.16) Lakhs as against Net Loss of Rs.(40,761.04) Lakhs, in the previous Financial Year due to booking of exceptional items arising out of loss on disposal of one of its Associate Companies and due to decrease in the share of loss of Associate Companies during the Current financial year. Gross Revenue during the current Financial Year increased to Rs. 35,008.90 Lakhs as against Rs. 22,672.53 Lakhs in the previous Financial Year due to increase in Toll Revenue across the subsidiaries and due to increase in notional construction revenue.

Key Financial Ratios in terms of Schedule V of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 are as under –

Particulars	FY 2022-23	FY 2021-22
Current Ratio	2.84	1.82
Debt-Equity Ratio	0.41	0.38
Debt Service Coverage Ratio	(0.10)	(0.05)
Return on Equity Ratio	(10.00)	(33.00)
Trade Receivable Turnover Ratio	5.87	13.60
Trade Payables Turnover Ratio	3.50	31.08
Net Capital Turnover Ratio	0.11	0.59
Net Profit Ratio	(300.00)	(353.00)
Return on Capital Employed	(6.00)	(28.00)
Return on Investment	(6.86)	(16.61)

Details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations thereof is as mentioned below –

• Current Ratio increased primarily on account of decrease in current liabilities, mainly other current financial liabilities, with increase in current assets.

• Debt Service Coverage Ratio decreased due to lesser earnings available for debt service during the year.

• Return on Equity has increased due to less losses in the current year.

• Trade Receivable Turnover Ratio decreased due to less revenue in Current year.

• Trade Payable Turnover Ratio decreased due to less purchase in the current year.

• Net Capital Turnover Ratio declined due to less revenue and enhanced working capital in the current year.

• Return on Capital Employed has increased due to less loss in the current year.

• Return on Investment has declined due to higher loss on investments in previous years.

DIVIDEND

The Company did not have distributable profit during the year under review and hence, the Board of Directors has not recommended any dividend on Equity Shares of the Company for the Financial Year ended 31st March, 2023.

TRANSFER TO RESERVES

No amount has been transferred to any Reserve during the year under review.

PROMOTERS? GROUP SHAREHOLDING

As on March 31, 2023, the total shareholding of Promoter and Promoter Group of your Company stood at 53.76% (previous year 53.76%) in the Paid-up Share Capital of the Company.

As on March 31, 2023, 22.16% (previous year 22.16%) of the Promoters? Group shareholding is under pledge.

In compliance with Regulation 31(2) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"), the entire shareholding of Promoter(s) and Promoter group is in dematerialized form.

PUBLIC DEPOSITS

Your Company has not invited or accepted any deposits covered under Section 73 of the Companies Act, 2013, read with the Companies (Acceptance of Deposits) Rules, 2014, during the year under review.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

I. OPPORTUNITIES FOR GROWTH FROM AN INDUSTRIAL AND

ECONOMIC PERSPECTIVE

The total road network in India is 6.37 Mn km comprising all categories of roads - national & state highways and urban & rural roads which is the second largest in the world. National Highways (NH) account for 2% of the total road network and carry over 40% of total traffic. Over 64.5% of all goods in the country are transported through roads, while 90% of the total passenger traffic uses the road network to commute. With the rapid development and expansion of road networks across the country, investment opportunities in logistics parks, industrial clusters, and special corridors are rising at an exponential rate.

Road Transport is a critical infrastructure for the economic development of a country. It impacts the pace, structure, and pattern of development. Historically, investments in the transport sector have been made by the Government. However, in order to encourage private sector participation, the Ministry has been effectively coming up with comprehensive policy guidelines for development of National Highways.

The allocation for the Ministry of Road Transport and Highways has seen a 36% increase over the budgetary allocation of Rs.1.99 lakh crores during the FY 2022-23 to around Rs. 2.70 lakh crore for 2023-24. Under the National Infrastructure Pipeline, the Indian government has allotted Rs. 111 lakh crore (US$ 13.14 billion) for the fiscal years 2019–25. Over 90% of the projected demand of the Ministry has been met in budget estimate 2023-24 with an enhanced focus on transportation infrastructure. As evinced, the increase in the allocation to the Ministry will have a multiplier effect on the economy. Over the past few years, the policy making framework has become a lot more dynamic. Policies are being amended and new guidelines are being framed to address issues that are coming up with the existintg framework. Policy & Guideline making has taken an On-Demand approach wherein different paths are being chalked out based on industry requirements.

National Monetization Pipeline (NMP) - NITI Aayog has developed the pipeline, in consultation with infrastructure line Ministries, based on the mandate for ‘Asset Monetisation? under Union Budget 2021-22. NMP estimates aggregate monetisation potential of Rs. 6.0 lakh crores through core assets of the Central Government, over a four-year period, from FY 2022 to FY 2025. Monetization of Rs. 0.97 lakh crore was completed under roads, power, coal and mines, which is beyond target of Rs. 0.9 lakh crore in FY22 under NMP.

In FY 23-24, a pipeline of 30 road projects with a total length of 1987 Km. have been chalked out for monetisation.

The top 5 sectors (by estimated value) capture ~ 83% of the aggregate pipeline value. The top five sectors include: Roads (27%), Railways (25%), Power (15%), Oil & Gas Pipeline (8%) and Telecom (6%).

Roads–	NMP Period:	Telecom–
Rs. 1,60,200 crores	4 Years (FY 22-25)	Rs. 35,100 crore
Railways–	TOTAL NMP–	Warehousing–
Rs. 152496 crore	Rs. 6.0 lakh crore	Rs. 28,900 crore
Power–		Mining–
Rs. 45,200 crore		Rs. 28,747 crore
Power Generation–		Aviation–
Rs.39832 Crore		Rs. 20,782 crores
Natural gas Pipeline –		Ports-
Rs. 24,462 crore		Rs. 12,828 crore
Product Pipeline –	Urban Real Estate–	Stadiums–
Rs. 22,504 crore	Rs. 15,000 crore	Rs. 11,450 crore

National Infrastructure Pipeline (NIP) - It is frequently acknowledged that a developing country?s major growth restriction is a lack of reliable infrastructure. The Indian Government is increasingly turning to business creating alliances via successful examples of co-working between the public and commercial sectors. An action in that direction is the National Infrastructure Pipeline. Strong infrastructure expansion is necessary to promote smooth functioning, enhance productivity in other economic sectors, and promote India?s ambitious objective of becoming a USD 5 trillion economy by 2025. The robustness of India?s infrastructure, in particular, has a direct impact on the performance of the industrial sector and "Make in India" initiative. There is a constant need for government intervention, solid funding, and constant monitoring of projects. Growing urbanisation, increasing working-age population, shift to a services-based economy and climate change are some of the factors that will require a further boost to India?s infrastructure sector and amplify need for the National Infrastructure Pipeline. Under this pipeline, the Indian Government has allotted Rs. 111 lakh crore (US$ 13.14 billion) for the fiscal years 2020–25.

As per data available with National Infrastructure pipeline Report of the MEA, Vol II, out of the total NIP of Rs. 111 lakh crore, Rs. 44 lakh crore (40%) worth of projects are under implementation, Rs. 34 lakh crore (30%) worth of projects are at the conceptualization stage, and Rs. 22 lakh crore (20%) worth of projects are under development.

Sector-wise break-up of capital expenditure of Rs. 111 lakh crore during fiscals 2020-2025

The Government aims to generate Rs. 1.6 lakh crore by monetizing 26,700 km of four-lane-and-above National Highways via the Toll-Operate-Transfer (TOT) and the Infrastructure Investment Trust (InvIT) routes at Rs. 6 crore per km. In FY 23-24, 30 road assets are to be monetized with a total length of 1987 Kms through ToT and InvIT modes.

According to the Ministry of Road Transport and Highways Annual Report (2022-23), Cabinet Committee on Economic Affairs (CCEA) approved Toll, Operate and Transfer (TOT) Model in August 2016 for monetization of developed National Highway (NH) stretches. Target of Rs. 10,000 crores was set for realization of funds under TOT during 2022-23.

A sum of Rs. 15,703.5 crore already realized and remitted to CFI against the monetized length of 245 km of NHs. NHAI has also raised Rs. 7350 crores during FY 2021-22 and Rs. 2,850 crores during FY 2022-23 through InvIT mode.

The Ministry is also planning to open NHAI Invit Bonds every 15 days with a lucrative interest rate of 8.05% which surpasses the traditional bond value.

NHAI has also successfully raised funds through Project based financing. During 2020-21 and 2021-22, an amount of Rs. 23,737 crores have been raised. Further Rs. 3,900 crores have been raised during 2022-23 so far.

Road Sector update:

Assets Considered for Monetization – The total length of assets considered for monetization over FY 22 – 25 climbs up to 26,700 km. This is based on the length of already/to be operational four lane highways and above entailing potential for revenue generation and thereby monetization.

Indicative Monetization Value of Assets and phasing – The total indicative Monetization Value of Assets considered for monetization is estimated at Rs. 1.6 Lakh crore for FY 22 -25. The Asset Pipeline has been phased out over the NMP period to ensure better preparedness and improved marketability. The summary of annual phasing is as follows:

The total expenditure of the Ministry during the FY 2023-24 is estimated at Rs.2,70,435 crore. This is 25% higher than the revised estimates for the FY 2022-23. The highest expenditure (60% of the total expenditure) is towards NHAI. In 2023-24, NHAI is allocated Rs. 1,62,207 crore, all of which is budgetary support.

Capital expenditure for during FY 2023-24 is estimated at Rs. 2,58,606 crore, while revenue expenditure is estimated at Rs. 11,829 crore. The proportion of capital expenditure in total expenditure has increased from the revised estimates of 2022-23, from 95% to 96%.

NHAI has greatly accelerated its pace of national highway construction, from only 2,623 km in FY 2017 to 4,325 km in FY 2022 and 4,882 Kms of National highway construction in FY 2023. However, more projects being executed on the Engineering, Procurement, and Construction (EPC) and Hybrid Annuity Model (HAM) modes has meant a greater constraint of funds. Given the high targets under projects such as Bharatmala and the construction of high-value expressways, in addition to higher repayment of borrowings, the authority?s requirement reaches up to Rs 10 lakh crore over the next 5 years vis-?-vis the previous 5 years. If these funding requirements are met, it is being estimated that it is possible to construct 25,000 km of national highways over fiscal 2022-2026, compared with 17,228 km over fiscal 2017-2021.

It has also been mentioned in the Union Budget 2023-24, that the 50-year interest free loans to the state governments will be continued for one more year to spur investments in infrastructure.

FASTag – The introduction of FASTag and its widespread use throughout the country resulted in an increase in revenue numbers and other quantitative benefits. The revenue earned through FASTag mode goes up to Rs 50,855 Crores in the Calendar Year 2022 which is 46% higher than 2021. The highest Toll collection of Rs.144.19 Cr was recorded in the month of December, 2022.

Due to infrastructural enhancements such as FASTags, the waiting at the toll plaza has been reduced to 47 seconds in 2023 from 734 seconds recorded in 2014. This reduction in waiting time resulted in a decrease in fuel costs, benefiting every user. The Authority aims to further reduce this time to 30 seconds. FY 2022 Recorded a total of 324 crores transactions which is 48% higher than the previous year. The total number of toll plazas has increased from 922 in FY22 to 1181 in FY 23.

Major Initiatives taken by the Ministry:

Dispute Resolution Mechanism:

Vivad Se Vishwas Scheme – Government of India promulgated a scheme to resolve the ever-increasing claim through arbitration and disputes. Vivad se Vishwas II scheme, introduced in 2023-24 Budget, aims to promote ease of doing business in India by resolving disputes and reduce the litigation burden of the infrastructure sector. Under the proposed scheme, in instances where disputes arise and are subsequently resolved through a court or arbitral order, the settlement amount to be paid would equate to 85% or 65% of the respective court-awarded or arbitral tribunal-awarded sum. In order to meet the eligibility criteria for the scheme, Arbitral awards must be issued by January 31, 2023, and Court Awards must be issued by April 30, 2023.

The scheme applies to disputes where one party is the Government of India or its bodies such as Public Sector Banks, Financial Institutions, Central Public Sector Enterprises, Union Territories, and entities where the Central Government holds a 50% shareholding. However, disputes involving claims against procuring entities along with other parties like State Governments or private parties are not eligible.

The initiative would enable the private infrastructure player and the private contractor to expeditiously settle their outstanding claims thereby enhancing their liquidity stuck in litigation and arbitration.

Bharatmala Pariyojana – The Bharatmala Pariyojana (BMP) was designed to build 34,800 kilometers of National Highways in a span of five years, from 2017-18 to 2021-22. The projected cost of the project was Rs. 5,35,000 Crore. The main objective of the project is to improve the transportation of goods and people across the country by constructing highways that would bridge important infrastructure gaps. This would help reduce travel time and expenses, making transportation more efficient and cost-effective. Bharatmala Pariyojana Phase-I was initiated with an ambitious target of completion by 2022. However, only about 35 percent of the BMP Phase-I has been completed till January 2023. About 27 percent of the Phase-I is yet to be awarded. The Ministry has stated that it would award most of the remaining length by FY 23-24. Special attention has been paid to fulfill the connectivity needs of backward and tribal areas, areas of economic activity, places of religious and tourist interest, border areas, coastal areas, and trade routes with neighboring countries.

As part of Phase-I of the programme, 27 Greenfield corridors are planned with an overall length of 9,000+ kms. As a part of Bharatmala Pariyojana, India?s largest expressway, i.e., Delhi-Mumbai Expressway which is 1,386 km long, is being developed and some sections such as Delhi – Dausa (Jaipur), Vadodara – Ankleshwar sections of the Expressway are nearing completion. Other key corridors which have already been completed/nearing completion are Ambala – Kotputli Corridor & Amritsar – Jamnagar Corridor.

In Bharatmala Pariyojana, 60% of projects on HAM, 10% projects on BOT (Toll) Mode and 30% projects on EPC mode have been envisaged respectively.

PM Gati Shakti

Honorable Prime Minister of India launched PM Gati Shakti National Master Plan (NMP) for multimodal connectivity on October 13, 2021. It is a giant stride in India?s ambitious goal of achieving US $5 trillion economy. PM Gati Shakti focuses on India?s citizens, industries, manufacturers, farmers, and villages among others. The PM Gati Shakti NMP is aimed at breaking departmental silos and bringing in more holistic and integrated planning and execution of projects with a view to addressing the issues of multi-modal connectivity and last-mile connectivity.

Multi Model Logistic Park (MMLP)

35 MMLPs are being developed on Pan India basis on Hub and Spoke? model. Of the 35 Multi-Modal Logistics Parks, MMLP in Jogighopa, Assam has been awarded and is under construction under EPC mode by NHIDCL. Out of the remaining 34 sites, 15 sites have been prioritized for award by FY 25. Model Concession Agreements and Request for Proposal for development of MMLPs in PPP Mode have been approved.

These logistics parks aim to reduce the overall transportations costs which result in ease of doing business in India and reduction of costs for every commodity.

Connectivity to Tourist Destinations

The Honorable Finance Minister of India announced in the budget speech of 2023-24 that at least 50 tourist destinations will be selected wherein each destination would be developed as a complete package. Physical connectivity will be an important aspect in the development of these destinations. Stellar road connectivity can significantly boost the tourism prospects of any given region. It is also decided to apprise the roadmap for improving highway connectivity to the 50 iconic tourist destinations mentioned in the Budget Speech.

One of the goals laid out in the ‘Five Year Vision Plan (2019-24) for Infrastructure Sector? prepared by the Sectoral Group of Secretaries, is to strengthen connectivity to top 100 tourist destinations. The Ministry informed that out of total 100 tourist destinations, about 87 Nos. of tourist destinations are either on NH or located within 10 Km of NH.

Public Transport Terminal Infrastructure (PTI)

A Public Transport Terminal Infrastructure (PTI) is envisioned as a world-class passenger movement facility, designed to provide a hub for interfacing and interconnecting a variety of intercity, regional, and local public transport systems, all within a single facility. PTI at Katra (Jammu) is planned for award in the FY 2022-23. Detailed Feasibility Report is under preparation for 3 locations, namely, Nagpur (Maharashtra), Katra (Jammu) and Tirupati (Andhra Pradesh). In addition, Pre-feasibility study for 4 locations in Haryana is complete.

Setu Bandhan

As per the Ministry, Under the Setu Bandhan scheme of the Ministry, replacement of railway line Level Crossings (LCs) with Road Over Bridges (ROBs)/Rail Under Bridges (RUBs) through CRIF on State roads/MDR/ODR will be done. The allocation of funds for the year 2022-23 under this scheme is Rs.1326 crore.

Technological Enhancements & Developments in Road Sector

• General Navigation with Satellite Systems: The On-Board Units installed on vehicles to be tracked by satellites, which will monitor their movement over the tolled section of the road to assess the toll, based on distance travelled. When implemented, user will have to pay only for the part of the Toll road travelled or used by them.

• Intelligent compaction measurement values (ICMV): Intelligent compaction (IC) is an equipment-based technology to improve quality control of compaction. ICMV is a generic term for a calculated value based on accelerometer measurements on vibratory roller drums. ICMV offers several benefits such as improved depth of compaction, lesser highway repair costs and better density, which would significantly improve the lifecycle cost.

• Self-healing asphalt: Road repair and maintenance is a costly job. To Reduce the cost and bring in state of the art technological advancements in the arena of Road repair and maintenance, scientists are developing ingenious and unconventional methods to improve durability. Rather than improving the strength of the road, scientists are focusing on asphalt with the ability to heal itself once damaged.

• Quick-change moveable barriers (QMB): The QMB is an innovative system that prevents tailbacks at road exits, allowing rapid movement of the safety barrier delimiting motorway deviations and lanes. The QMB system is used for both construction sites and fixed plants, where the flow of commuter traffic is in different directions in the morning and evening. The system involves a machine that shifts the barrier sideways at a rate of 9 and 15 km/h.

E- Initiatives of the Ministry

Bhoomi Rashi - Land Acquisition Portal

The Ministry of Road Transport and Highways has launched Bhoomi Rashi portal to digitize the Land Acquisition notification process and avoid parking of public funds with the Competent Authority for Land Acquisition (CALA). Since the operationalization of the portal, land acquisition process has been expedited significantly, it has become error-free and more transparent and the notifications at every stage are being processed on a real time basis. During the period 1st January, 2022 to 31st December 2022, a total of 3019 Land Acquisition notifications have been issued and nearly 26254 hectares of land have been notified for acquisition for National Highway projects.

II. BUSINESS & OPERATIONS

Your Company is a road BOT company in India, focused on development, implementation, operation and maintenance of National and State Highways with execution experience in developing, operating and maintaining Seven (7) BOT Projects covering over 2250 Lane km of Roads and Highways in states of Uttar Pradesh, Kerala, Haryana, Madhya Pradesh, Jharkhand, Maharashtra and Odisha.

The main business operations of your company can be divided into three categories, i.e.

(i) Project development and implementation.

(ii) Tolling Operations and Highway Management; and

(iii) Advisory Services and Project Management Services including Construction Supervision/Debt Syndication for your Company?s projects.

During the year under review, your Company has focused on all these areas to augment resources while channelizing resources towards portfolio realignment and claim realization. With successful completion of portfolio realignment through transfer of asset ownership, your Company is today operating 2 BOT projects worth Rs. 1813 crores covering 660 lane km of National Highway in Kerala and Maharashtra.

III. BUSINESS PERFORMANCE

During the year under review, your Company continued its focus on improving operational efficiency through increased automation of services and strengthened its focus on effective value realization through portfolio divestment and efficient Claims and Contracts Management through arbitration & conciliation.

Traffic and Revenue Growth

The Average Daily Revenue (ADR) across all the operational projects ended up at Rs. 189.44 lakhs during the Financial Year 2022-23 with total revenue of Rs. 326.46 crores from an ADR of Rs. 170.44 Lakhs and toll revenue of Rs. 622.02 crores in the Financial Year 2021-22. The sharp decline was mainly due to portfolio realignment with toll revenue from the divested as well as handed over projects revenue not considered for the overall toll revenue for the entire year. (ADR has been computed based on number of operational days for respective SPVs).

There was an increase in toll revenue at the operational projects i.e., GIPL and STPL. Due to anticipated increasing economic activity along the project sections? high growth industrial corridors, the toll income is anticipated to increase this year. The updated and advanced tolling system (ETC operations) has been installed on all of your company?s projects, which has resulted in increased toll collection and lower operating costs.

Guruvayoor Infrastructure Private Limited (GIPL): During the year under review the Average Daily Traffic (ADT) has seen a rise of 26% over the ADT of previous year i.e., FY 21-22. The Average daily Revenue (ADR) saw an increase of 33.38% to Rs. 44.59 lakhs in FY 2022-23 as against Rs. 33.43 Lakhs in FY 2021-22. The company has successfully implemented payment from Kerala State Road Transport Corporation (KSRTC) buses. Though during the year under review, GIPL has been able to collect toll from KSRTC Busses, the status of free passes issues to locals as per the order from Government of Kerala remains the same where no toll was collected from the locals. Therefore, GIPL has invoked arbitration against NHAI for all the claims which are pending for adjudication.

Solapur Tollways Private Limited (STPL): During the year under review, STPL reported an impressive increase in its Average Daily Revenue with an ADR of Rs. 23.06 lakhs in FY 2022-23 as against Rs.18.73 Lakhs as compared to the previous year. This is an increase of 23.12% compared to the numbers of the last year and the increase in ADR is recorded even when there is a decrease in Average Daily Traffic by 1%.

IV. FUTURE BUSINESS PLANS

Your company is an infrastructure developer operating on asset aggregation platform and hence it has always been focused on value accretion through portfolio realignment while strengthening operational efficiency through extremely efficient claims and contract management, robust construction management system and processes. With a constant focus on enhancing capabilities to better assess, manage, and mitigate claims and risk; the Company is focused towards expeditious handling of claims through negotiation, mediation, arbitration and litigation. Your company has now renewed focus and strengthened approach channelizing its efforts and actions towards realization of claims through arbitration, conciliation and litigation.

The initiatives towards portfolio realignment have enabled your company to engage in discussion and negotiation with global institutional infrastructure investors. This reflects the deep domain expertise and experience which exudes high trust and exceptional inter-corporate relation among the leading infrastructure players in India. The collaborative effort with such globally recognized infrastructure institutions enables your company to bring forth global best practices in highway infrastructure maintenance and management in our country.

With successful portfolio realignment during the year, your Company has also put forward its efforts on optimizing financial efficiencies and scaling greater heights in achieving operational excellence in existing projects while streamlining efforts towards construction management and claim realization. Your Company will be continuously utilizing new and available resources to improve and create an effective construction management process.

V. FUTURE OUTLOOK

India stands at a crucial juncture of progress, with the infrastructure sector assuming a pivotal role in driving the country?s economic advancement. The Government has placed considerable emphasis on implementing policies aimed at facilitating the creation of top-tier infrastructure within set timeframes. This sector not only acts as a catalyst for economic growth but also fuels the expansion of interconnected industries such as townships, housing, construction, and building development projects. Forecasts indicate that the infrastructure sector in India is projected to achieve a Compound Annual Growth Rate (CAGR) of 8.2% by 2027. This underscores the urgent need to fortify and enhance the sector, as evidenced by the government?s allocation of INR 10 lakh crore in the Union Budget for 2023-24. Your Company shall also aim towards consolidation and realignment of business strategies for staying ahead on the growth curve.

VI. HUMAN RESOURCES AND INDUSTRIAL RELATIONS

Your company remains dedicated to the growth and development of human capital, adhering to widely recognized human resource practices for the collective growth of the team members and the organization. As of March 31, 2023, the overall group headcount, including the SPVs, was 533 individuals. This consists of 256 on-roll employees and 277 off-roll resources. Your Company experienced significant variations in manpower strength due to portfolio realignment within the company.

Your Company?s Human Resources function has been working towards streamlining operations to meet compliance parameters while optimizing individual performances. Your Company focused on optimizing manpower through effective cross-utilization of its existing workforce, leveraging its functional expertise across different verticals.

Your Company continue to uphold policies, rules, and practices that treat employees with dignity and equality, ensuring compliance with employment and labor laws, corporate directives, and agreements. Additionally, your Company is dedicated to its core values, which prioritize the welfare of the community along the project stretch. Your Companys overarching goal is to provide a safe, healthy, and secure atmosphere that aligns with long-term family and community objectives.

VII. RISK MANAGEMENT

Risk management continues to be an integral part of your Company?s growth strategy. The risk management strategy of your Company hinges on a clear understanding of various risks and adherence to well-laid out risk policies and procedures that are benchmarked with industry best practices. Your Company has developed robust systems and embraced sturdy practices for identifying, measuring and mitigating various risks and ensuring that they are maintained within pre-defined risk appetite levels.

Risk and Concern

• Growth Risk

Growth risk is the inability to effectively manage growth or to successfully implement business plans which depends heavily on the ability to plan and execute the growth strategy. Growth Risk can impact organic as well as inorganic growth vision of the Company in the form of inability to successfully bid for new projects at attractive IRR or acquisition of existing stressed projects at attractive valuation.

Your Company?s growth risk mitigation strategy is guided by constant review and analysis of market opportunities and trends in both organic and inorganic space for selective bidding for new projects and acquisition for projects falling within the clearly defined investment criteria.

• Business Risk

Business Risk includes risks with respect to competition, capital intensiveness, input cost, traffic growth for BOT projects and labour.

Your Company faces risk of competition as the sector is growing and more players get qualified to bid for new projects, also as the business which your company operates is capital intensive by nature, availability of sufficient funds is critical for bidding of projects, particularly in case of fund-based projects such as BOT- toll, HAM and TOT model. Further, availability of the right quality and quantity of resources is critical for the timely completion of infrastructure projects, any unexpected increase in the input costs will have direct impact on overall margins. Moreover undue attrition of manpower could lead to loss of competitive edge as it may lead to project delays.

Your Company has a well-designed mitigation plan to address these business risks. Company adapts its policies and procedures to ensure a sustained business model. Your Company strives to execute maximum number of projects before their scheduled completion and within the budgeted cost. Your Company operates its working capital cycle in a highly optimized manner, your company enters into contracts with EPC Partners which has the relevant cost escalation provisions that protect your Company?s margins. Further, your company?s focus is to build an organisation of highly motivated employees, having the ability to execute ambitious business goals with passion and commitment, thereby exceeding customer aspirations. The working environment of the Company is cordial and employee-friendly. The remuneration is at par with the industry standards.

• Regulatory Risk

The business of the company is significantly dependent on various Government entities and could be adversely affected if there are adverse changes in the policies adopted by such Government entities.

Your Company regularly reviews and monitors government policies and likely developments along with an impact assessment of those policies so that necessary actions can be planned and implemented from time to time.

VIII. INTERNAL CONTROL AND AUDIT

Your Board places utmost importance in setting up and regularly enhancing Internal Control Framework in view of complex business environment and increasing regulatory oversight for sustainable growth. Your Company adopts a calibrated and smart framework spanning on pillars of administrative and financial controls. On the administrative control side, your Company has a proper reporting structure, several oversight committees, defined roles and responsibilities at all levels to ensure appropriate checks and balances. On the financial controls side, management with the knowledge and understanding of the business, its organization, operations, and processes has put in place appropriate controls including segregation of duties and reporting mechanism to deter and detect misstatements in financial reporting.

Your Company has an Internal Financial Control (IFC) System, commensurate with the nature of its business and the size and complexity of its operations. The Company?s system of internal control has been designed to provide a reasonable assurance with regard to controls over critical business activities and operations, policies and procedures for ensuring the orderly and efficient conduct of business, critical procurements, prevention and detection of frauds and errors, compliance with regulations and for ensuring timeliness and reliability of financial reporting. Your Company?s IFC have been reviewed and actions have been taken wherever needed, to strengthen control and overall risk management procedure.

The Audit Committee of the Board evaluates and reviews the adequacy and effectiveness of the Internal Control Systems and suggests improvements to strengthen them. Based on the report of Internal Auditor and the response thereto, necessary corrective actions are undertaken to strengthen the controls. Overall, the Board and the Audit Committee maintains a proactive approach in ensuring that the control and governance framework is regularly reviewed and timely corrective actions are taken to minimize risk of disruption.

During the year under review, your Company appointed M/s. KGRS & Co., a Chartered Accountant Firm (Firm Registration No. 310014E), having requisite academic and professional qualifications, work experience, skill and other suitable capabilities, as the Internal Auditor of the Company for the Financial Year ended 31st March, 2023.

There was no change in the Internal Auditor during the year under review.

SUBSIDIARY & ASSOCIATE COMPANIES

As on 31st March, 2023, your Company had 3 (three) Subsidiaries and 2 (two) Associate Companies.

During the year under review, your Company successfully consummated the transaction for sale of its entire shareholding in Ghaziabad Aligarh Expressway Private Limited (GAEPL), an "Associate" of the Company to Cube Highways and Infrastructure Pte Ltd on 26.05.2022, as contemplated under the Share Purchase Agreement dated 1st April, 2021 and related transaction documents. It also successfully consummated the transaction for sale of its entire shareholding in Shree Jagannath Expressways Private Limited ("SJEPL"), an "Associate" of the Company to Indian Highway Concessions Trust (the purchaser) acting through its investment manager on 28.06.2022, as contemplated under the Securities Purchase Agreement dated 20th January, 2021 and related transaction documents.

Details of changes in the Subsidiaries and Associate Companies during the year under review and as on the date of this report is as hereunder –

Name	Status
Ghaziabad Aligarh Expressway Private Limited (GAEPL)	Ceased to remain an Associate of the Company w.e.f. 26.05.2022
Shree Jagannath Expressways Private Limited (SJEPL)	Ceased to remain an Associate of the Company w.e.f. 28.06.2022

PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES & ASSOCIATE COMPANIES

The Statement in Form AOC-1 containing the salient features of the Financial Statements of your Company?s Subsidiaries and Associate Companies, pursuant to first proviso to Section 129(3) of the Companies Act, 2013 (Act), read with Rule 5 of the Companies (Accounts) Rules, 2014, forms part of this Annual Report. Further, in line with Section 129(3) of the Act read with the aforesaid Rules, the SEBI Listing Regulations, 2015) and in accordance with the Indian Accounting Standards specified under section 133 of the Act, Consolidated Financial Statements prepared by your Company includes financial information of its Subsidiary and Associate Companies.

Further, in accordance with Section 136 of the Companies Act, 2013, the Audited Financial Statements of each of the Subsidiary, included in the Consolidated Financial Statements prepared by your Company as per Rule 8(1) of the Companies (Accounts) Rules, 2014, is available on the website of your Company, www.brnl.in.

Members interested in obtaining a copy of the Annual Accounts of the Subsidiaries may write to the Company Secretary at your Company?s Registered Office. The said Report is not reproduced here for the sake of brevity.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THIS REPORT

There has been no material change and commitment affecting the financial position of your Company, which occurred from the end of the Financial Year ended on March 31, 2023 and the date of this Report.

CAPITAL STRUCTURE

At present, the Authorized Capital of the Company is Rs. 100 Crore (Rupees One Hundred Crore) divided into 10,00,00,000 (Ten Crore) Equity Shares of Rs. 10 (Rupees Ten) each.

The Paid-up Share Capital of your Company is Rs. 83.95 Crore (Rupees Eighty Three Crore and Ninety Five Lakhs) divided into 8,39,50,000 (Eight Crore, Thirty- Nine Lakhs, Fifty Thousand) Equity Shares of Rs. 10/- (Rupees Ten) each.

There has been no change in the capital structure of your Company during the year under review.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Directors

As on March 31, 2023, your Company has 7 Directors comprising of 1 Executive Director and 6 Non-Executive Directors out of which 4 are Independent Directors. Your Company also has a woman director on the Board.

During the year under review, Mr. Vipin Kumar Saxena (DIN: 08889866) Independent Director of your Company tendered his resignation as an Independent Director w.e.f. 30th May, 2022 due to personal reasons. He has confirmed vide his resignation letter that there is no other material reason other than the reason provided for his resignation.

Based on the recommendation of Nomination and Remuneration Committee, Mr. Rakesh Kumar Gupta (DIN: 06806891) was appointed by the Board of Directors as an Additional Director (Category: Non-Executive Non Independent Director) of the Company w.e.f. 18th August, 2022 and he was regularised at the 15th Annual General Meeting (AGM) of your Company held on 29th September, 2022.

Based on the recommendation of the Nomination and Remuneration Committee and subject to approval of the Members of your Company, the Board of Directors of your Company recommends redesignation of Mr. Rakesh Kumar Gupta (DIN: 06806891) as an Independent Director of your Company for a first term of 5 (five) consecutive years w.e.f. 12th August, 2023.

The tenure of Mr. Bajrang Kumar Choudhary as Managing Director of your Company was set to complete on 31st October, 2022 and in view of his dedicated and meritorious services and able leadership, the Board of Directors of your Company re-appointed Mr. Bajrang Kumar Choudhary (DIN: 00441872) as the Managing Director of your Company for a further period of 3 (three) years w.e.f. November 01, 2022 based on the recommendation of the Nomination and Remuneration Committee, subject to approval of Members at the 15th Annual General Meeting (AGM) of your Company. However, the Special Resolution proposed for re-appointment of Mr. Bajrang Kumar Choudhary (DIN: 00441872) as Managing Director of the Company failed to receive requisite number of votes in favour by the shareholders under remote e-voting and e-voting at the AGM and hence the resolution was not passed at the said AGM.

In line with the above, the tenure of Mr. Bajrang Kumar Choudhary as the Managing Director of the Company came to an end on 31st October, 2022 and he ceased to remain as the Managing Director and Key Managerial Personnel of the Company w.e.f. 1st November, 2022. He, however, continued as a Non-Executive Director on the Board of Directors in terms of the applicable regulatory provisions.

The candidature of Mr. Bajrang Kumar Choudhary for appointment as Managing Director of the Company was again placed before the shareholders by way of postal Ballot for consideration and prior approval, on the recommendation of the Nomination and Remuneration Committee and the Board of Directors and the reasons for the same were elaborated in great details forming part of the explanatory statement along with the resolution for his appointment in line with the provisions of Regulation 17(1C) of SEBI Listing Regulations.

Based on the above, Mr. Bajrang Kumar Choudhary (DIN: 00441872) has been appointed as the Managing Director of the Company for a period of 3 years w.e.f. 22nd December, 2022 pursuant to applicable regulatory provisions and Regulation 17(1C) of SEBI Listing Regulations. The Board of Directors places on record sincere gratitude for each and every member of the Company for their unwavering support and trust in their decision to appoint Mr. Bajrang Kumar Choudhary as the Managing Director of your esteemed Company. Your faith in his ability to steer the Company forward is a testimony of the confidence you have in his vision and expertise.

Pursuant to the provisions of Section 152(6) of the Companies Act, 2013 and Rules made thereunder, Mr. Bajrang Kumar Choudhar (DIN: 00441872), Managing Director of your Company, retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

Based on the recommendation of Nomination and Remuneration Committee, Mr. Shree Ram Tewari (DIN: 07698268) was appointed by the Board of Directors as an Additional Director (Category: Non-Executive Non Independent Director) of the Company w.e.f. 1st November, 2022 and his appointment was regularised through a resolution proposed before the shareholders through postal ballot which was approved by the members on 17th December, 2022.

Based on the recommendation of the Nomination and Remuneration Committee and subject to approval of the Members of your Company, the Board of Directors of your Company recommends redesignation of Mr. Shree Ram Tewari (DIN: 07698268) as an Independent Director of your Company for a first term of 5 (five) consecutive years w.e.f. 12th August, 2023.

The brief resume / details relating to Directors who are proposed to be appointed / re-appointed are furnished in the Notice of the ensuing AGM. The Board of Directors of your Company recommends the appointment / re-appointment of the above Directors.

Your Company has received declaration from each of the Independent Directors under Section 149(7) of the Companies Act, 2013 that they meet the criteria of Independence as laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of SEBI Listing Regulations, and that he/she is not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact his/her ability to discharge his/her duties with an objective independent judgment and without any external influence. All requisite declarations have been duly placed before the Board.

In the opinion of the Board, the Independent Directors fulfill the conditions as specified under Companies Act, 2013 and SEBI Listing Regulations, and are independent of the management. The majority of the Independent Directors are exempted from appearing the online proficiency self-assessment test conducted by the institute notified under section 150(1) of the Companies Act, 2013.

In the opinion of the Board, the independent director(s) appointed possess integrity, expertise and experience (including the proficiency) and shall clear the online proficiency self-assessment test conducted by the institute notified under section 150(1) of the Companies Act, 2013, within the stipulated timelines, wherever applicable.

In terms of SEBI Listing Regulations, your Company has identified core skills/expertise/competencies as is required in the context of the Company?s business(es) and sector(s) for it to function effectively. Details of such skills/expertise/competencies identified along with the names of directors who have such skills / expertise / competence are furnished in the Corporate Governance Report and forms part of this Annual Report.

During the year under review, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with your Company, other than sitting fees for the purpose of attending meetings of the Board/Committee of the Company and reimbursement of expenses, if any.

Key Managerial Personnel

Mr. Chathanur Krishnan Ranganathan, who was appointed as the Chief Financial Officer of the Company by the Board of Directors w.e.f. close of business hours on 29th June, 2021 on the recommendation of Nomination and Remuneration Committee and approval of the Audit Committee, tendered his resignation as the Chief Financial Officer of the Company w.e.f. close of business hours on 30th July, 2022.

In view of the above and based on the recommendation of Nomination and Remuneration Committee and approval of the Audit Committee, Mr. Arindam Bhowmick was appointed as the Chief Financial Officer of the Company by the Board of Directors w.e.f. 23rd January, 2023.

The tenure of Mr. Bajrang Kumar Choudhary as Managing Director of your Company was set to complete on 31st October, 2022 and in view of his dedicated and meritorious services and able leadership, the Board of Directors of your Company re-appointed Mr. Bajrang Kumar Choudhary (DIN: 00441872) as the Managing Director of your Company for a further period of 3 (three) years w.e.f. November 01, 2022 based on the recommendation of the Nomination and Remuneration Committee, subject to approval of Members at the 15th Annual General Meeting (AGM) of your Company. However, the Special Resolution proposed for re-appointment of Mr. Bajrang Kumar Choudhary (DIN: 00441872) as the Managing Director of the Company failed to receive requisite number of votes in favour by the shareholders under remote e-voting and e-voting at the AGM and hence the resolution was not passed at the said AGM.

In line with the above, the tenure of Mr. Bajrang Kumar Choudhary as the Managing Director of the Company came to an end on 31st October, 2022 and he ceased to remain as the Managing Director and Key Managerial Personnel of the Company w.e.f. 1st November, 2022.

The candidature of Mr. Bajrang Kumar Choudhary for appointment as Managing Director of the Company was again placed before the shareholders by way of postal Ballot for consideration and prior approval, on the recommendation of the Nomination and Remuneration Committee and the Board of Directors and the reasons for the same were elaborated in great details forming part of the explanatory statement along with the resolution for his appointment in line with the provisions of Regulation 17(1C) of SEBI Listing Regulations.

Based on the above, Mr. Bajrang Kumar Choudhary (DIN: 00441872) has been appointed as the Managing Director of the Company for a period of 3 years w.e.f. 22nd December, 2022 pursuant to applicable regulatory provisions and Regulation 17(1C) of SEBI Listing Regulations.

Mr. Naresh Mathur (FCS: 4796), Vice President and Company Secretary retired from the services of the Company w.e.f. the close of business hours of 30th September, 2022 on attaining the age of superannuation.

Ms. Ankita Rathi (ACS: 46263) was appointed as the Company Secretary of the Company with effect from 23rd January, 2023 in compliance with the provisions of Sections 203 and 2(51) of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (as amended from time to time). She is also the Compliance Officer in terms of Regulation 6 of SEBI Listing Regulations.

As per the provisions of Section 203 of the Companies Act, 2013, read with Rule 8 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, the following Director / Executives of your Company are the Key Managerial Personnel as on 31st March, 2023 and as on the date of this Report -

Name	Designation
Mr. Bajrang Kumar Choudhary	Managing Director
*Mr. Arindam Bhowmick	Chief Financial Officer
*Miss. Ankita Rathi	Company Secretary

*w.e.f. 23rd January, 2023

MEETINGS OF BOARD OF DIRECTORS

The Board meets at regular intervals to discuss and decide on policy and strategy apart from other Business. However, in case of a special and urgent business need, the Board?s approval is taken by passing resolutions through circulation, as permitted by law, which are noted at the subsequent Board Meeting.

8 (Eight) Meetings of the Board of Directors of the Company were held during the Financial Year 2022-23 on 27th April, 2022, 30th May, 2022, 2nd August, 2022, 13th August, 2022, 20th October, 2022, 1st November, 2022, 12th November, 2022 and 23rd January, 2023.

The maximum time gap between any two consecutive meetings did not exceed 120 (One Hundred Twenty) days.

The details of the board meetings, the attendance of the Directors thereof and other particulars are provided in the Corporate Governance Report forming part of this Annual Report.

AUDIT COMMITTEE

The Audit Committee of your Company has been constituted in line with the provisions of Section 177 of the Companies Act, 2013 and Regulation 18 of the SEBI Listing Regulations.

As on 31st March, 2023, the Audit Committee comprised of Mr. Brahm Dutt (Independent Director) acting as the Chairman of the Committee, Prof. Santanu Ray (Independent Director) and Dr. (Ms.) Tuk Tuk Ghosh Kumar (Independent Director) acting as the Members of the Committee.

The Board of Directors had reconstituted the Audit Committee by way of a Circular Resolution passed on 6th July, 2023 post which, the Audit Committee comprised of Prof. Santanu Ray (Independent Director) acting as the Chairman of the Committee, Mr. Brahm Dutt (Independent Director) and Dr. (Ms.) Tuk Tuk Ghosh Kumar (Independent Director) acting as the Members of the Committee as on the date of this Report.

Miss. Ankita Rathi, Company Secretary acts as the Secretary to the Committee.

Mr. Bajrang Kumar Choudhary, Managing Director is a permanent invitee to the Meetings of Audit Committee.

The scope and functions of the Audit Committee is in accordance with the provisions of the Companies Act, 2013 and the SEBI Listing Regulations. The brief Terms of Reference of the Audit Committee has been provided in the Corporate Governance Report, forming part of this Annual Report.

5 (five) Meetings of the Audit Committee were held during the Financial Year 2022-23 on 27th April, 2022, 30th May, 2022, 13th August, 2022, 12th November, 2022 and 23rd January, 2023.

During the year under review, there were no instances wherein the Board had not accepted any recommendation from the Audit Committee.

NOMINATION AND REMUNERATION COMMITTEE

The Board of Directors of the Company has constituted a Nomination and Remuneration Committee in accordance with the provisions of Section 178 of the Companies Act, 2013 and Regulation 19 of the SEBI Listing Regulations.

As on 31st March, 2023, the Committee comprised of Prof. Santanu Ray (Independent Director), acting as the Chairman of the Committee, Mr. Brahm Dutt (Independent Director) and Dr. (Ms.) Tuk Tuk Ghosh Kumar (Independent Director) as Members of the Committee.

The Board of Directors had reconstituted the Nomination and Remuneration Committee by way of a Circular Resolution passed on 6th July, 2023 and presently, the Nomination and Remuneration Committee comprises of Prof. Santanu Ray (Independent Director) acting as the Chairman of the Committee, Mr. Brahm Dutt (Independent Director), Dr. (Ms.) Tuk Tuk Ghosh Kumar (Independent Director) and Mr. Shree Ram Tewari (Non-Executive Non-Independent Director) acting as the Members of the Committee as on the date of this Report.

Mr. Shree Ram Tewari (DIN: 07698268) has been re-designated as an Independent Director of your Company for a first term of 5 (five) consecutive years w.e.f. 12th August, 2023 subject to the approval of the Members at the ensuing Annual General Meeting.

Miss Ankita Rathi, Company Secretary acts as the Secretary to the Committee.

Mr. Bajrang Kumar Choudhary, Managing Director, is a permanent invitee to the Meetings of Nomination and Remuneration Committee.

The scope and function of Nomination and Remuneration Committee is in accordance with the provisions of the Companies Act, 2013 and the SEBI Listing Regulations. The brief Terms of Reference of the Committee has been provided in the Corporate Governance Report, forming part of this Annual Report.

5 (five) meetings of the Nomination and Remuneration Committee were held during the Financial Year 2022-23 on 30th May, 2022, 13th August, 2022, 20th October, 2022, 1st November, 2022 and 23rd January, 2023.

The Committee has formulated the Nomination and Remuneration Policy (‘BRNL Nomination and Remuneration Policy?) which broadly lays down the various principles of remuneration viz. support for strategic objectives, transparency, internal & external equity, flexibility, performance-driven remuneration, affordability and sustainability and covers the procedure for selection, appointment and compensation structure of Board Members, Key Managerial Personnel (KMP) and Senior Management Personnel (SMP) of your Company.

The BRNL Nomination and Remuneration Policy has been hosted on the website of the Company, www.brnl.in and a link to the said Policy has been provided elsewhere in this Annual Report.

During the year under review, no changes were made in the Nomination and Remuneration Policy of the Company.

CCORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Company has constituted a CSR Committee, as required in terms of Section 135 of the Companies Act, 2013 and the Rules made thereunder.

As on 31st March, 2023, the Committee comprised of Dr. (Ms.) Tuk Tuk Ghosh Kumar (Independent Director), acting as the Chairperson of the Committee, Mr. Praful Tayal (Independent Director), and Mr. Bajrang Kumar Choudhary (Managing Director) acting as Members of the Committee.

The Board of Directors had reconstituted the CSR Committee by way of a Circular Resolution passed on 6th July, 2023 post which, the CSR Committee comprised of Dr. (Ms.) Tuk Tuk Ghosh Kumar (Independent Director), acting as the Chairperson of the Committee, Mr. Praful Tayal (Independent Director), Mr. Rakesh Kumar Gupta (Non-Executive Non-Independent Director) and Mr. Shree Ram Tewari (Non-Executive Non-Independent Director) acting as the Members of the Committee.

Both Mr. Rakesh Kumar Gupta (DIN: 06806891) and Mr. Shree Ram Tewari (DIN: 07698268) have been re-designated as Independent Directors of your Company for a first term of 5 (five) consecutive years w.e.f. 12th August, 2023 subject to the approval of the Members at the ensuing Annual General Meeting.

Miss. Ankita Rathi, Company Secretary acts as the Secretary to the Committee.

The brief Terms of Reference of the Committee has been provided in the Corporate Governance Report forming part of this Annual Report.

The Company has also framed a CSR Policy, in line with the provisions of Section 135 of the Companies Act, 2013, and the same has been hosted on the website of the Company, www.brnl.in and a link to the said Policy has been provided elsewhere in this Annual Report. Your Company strives to contribute towards CSR as per the line items included in Schedule VII to the Companies Act, 2013.

Two per cent. of the average net profits of your company made during the three immediately preceding financial years is negative, and therefore, your Company is not required to make any mandatory contribution towards CSR for the Financial Year 2022-23.

During the year under review, 2 (two) CSR Committee Meetings were held on 28th May, 2022 and 23rd January, 2023.

As prescribed under Section 135 of the Companies Act, 2013, read with relevant rules, an Annual Report on CSR Activities has been set out as an Annexure to this Directors? Report.

At the meeting of the Bord of Directors held on 12th August, 2023, the Corporate Social Responsibility Committee was dissolved w.e.f. 12th August, 2023 in line with the provisions of Section 135(9) of the Companies Act, 2013 and the functions of such Committee shall be discharged by the Board of Directors of Your Company.

PERFORMANCE EVALUATION

The Nomination and Remuneration Committee (NRC) of your Company has formulated and laid down criteria for Performance Evaluation of the Board (including Committees) and Individual Directors (including Chairman, Managing Director and Independent Directors) covering, inter alia, the following parameters:

(i) Board Evaluation - degree of fulfillment of key responsibilities; Board culture and dynamics, amongst others;

(ii) Board Committee Evaluation - effectiveness of meetings; Committee dynamics, amongst others;

(iii) Individual Director Evaluation (including Chairman and Independent Directors) - Attendance, Contribution at Board Meetings, Guidance/support to management outside Board / Committee meetings, fulfilment of criteria of independence for independent Directors; etc., amongst others.

The Board evaluation framework has been designed in compliance with the requirements under the Companies Act, 2013, SEBI Listing Regulations and in accordance with the Guidance Note on Board Evaluation issued by SEBI in January, 2017.

During the year under review, Annual Performance Evaluation was carried out by the Board of its own performance as well as evaluation of the working of various Board Committees, viz., Audit Committee, Stakeholders Relationship Committee, Nomination and Remuneration Committee and Corporate Social Responsibility Committee. This evaluation was led by the Chairman of the Board with specific focus on performance and effective functioning of the Board, its Committees and individual Directors. All the evaluation were conducted through structured self assement based questionnaire designed with qualitative parameters and feedback based on ratings and were conducted after seeking inputs from all the Directors/Committee Members.

Based on the above parameters, the performance of the Board was found to be effective and that of the majority of the Individual Directors (including Independent Directors) was evaluated and found to be effective. Performance evaluation of independent directors was done by the entire Board, excluding the independent director being evaluated.

It was evaluated and found that the performance of Board Committees is effective, based on the ratings assigned and they are adequately composed (in terms of size, skill, expertise, experience, etc.) to carry out the responsibilities and addressing the objectives for which it has been set up by the Board. Also, there is clarity between the Board, Management and Committee w.r.t. the role played by the committee.

During the year under review, in a separate meeting of Independent Directors, performance of non-independent directors, the Board as a whole and the Chairman of the Company was evaluated, taking into account the views of executive directors and Non-Executive directors. It was held unanimously that the Non-Independent Director, viz Managing Director brings to the Board, abundant knowledge in his field and is an expert in his area. Besides, he is insightful, convincing, astute, with a keen sense of observation, mature and has a deep knowledge of your Company. The Managing Director?s performance was rated as effective.

It was held unanimously agreed that other Non-Executive Non-Independent Directors actively engaged in the board?s deliberations and provided an independent perspective to drive strategic decision-making and objective judgement. Their performance was rated as effective.

The Board, as a whole, is an integrated, balanced and cohesive unit, where diverse views are expressed and discussed when required, with each Director bringing professional domain knowledge to the table. All Directors are participative, interactive and communicative. The Board?s performance was rated as effective.

The Chairman of the Board had abundant knowledge, experience, skills and understanding of the Board?s functioning, possesses a mind for detail, is meticulous to the core and conducts the Meetings with poise and maturity. The Chairman?s performance was rated as effective.

The information flow between your Company?s Management and the Board is satisfactory.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Your Company is engaged in Infrastructure Sector, as stated in the Schedule VI to the Companies Act, 2013. By virtue of the provisions of Section 186(11), the provisions of Section 186, read with the Companies (Meeting of the Board and its Powers) Rules, 2014, as amended from time to time, relating to loan made, guarantee given or security provided, do not apply to your Company.

Particulars of loans, guarantees or investments given/made under section 186 forms part of the financial statements, forming part of this Annual Report.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

A Related Party Transactions Policy has been devised by your Company for, inter alia determining the materiality of transactions with related parties and dealings with them in line with the requirements of the SEBI Listing Regulations and it intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and Related Parties.

The said Policy is available on your Company?s website, www.brnl.in and a link to the said Policy has been provided elsewhere in this Annual Report.

During the year under review, all related party transactions entered into by the Company, were approved by the Audit Committee and were at arm?s length and in the ordinary course of business and were in compliance with the applicable provisions of the Companies Act, 2013 and SEBI Listing Regulations. Material Related Party Transactions as per SEBI Listing Regulations and as per Companies Act, 2013 are placed before the Members for their approval.

During the year under review, your Company had entered into Material Related Party Transactions at an Arms Length Basis and in the Ordinary Course of Business, details of which, as required to be provided under section 134(3)(h) of the Companies Act, 2013 are disclosed in Form AOC-2 and forms part of this Annual Report.

Further, there are no materially significant related party transactions entered by the Company with Promoters, Directors, Key Managerial Personnel or other Designated Persons, during the year under review, which may have a potential conflict with the interest of the Company at large. Members may refer to the Notes to the Financial Statements for details of Related Party Transactions.

The Board of Directors recommend to the Shareholders of your Company to accord prior approval to the proposed Related Party Transactions proposed to be entered into by the Company during the period 1st October, 2023 to 30th September, 2024 (including subsequent material modification(s), if any to be made in the proposed RPTs), which may/may not be material in terms of the Companies Act, 2013 and SEBI Listing Regulations, at the ensuing Annual General Meeting of the Company.

POLICY FOR DETERMINING ‘MATERIAL? SUBSIDIARIES

Your Company has formulated a Policy for determining Material Subsidiaries in accordance with the applicable laws. The said Policy is available on your Company?s website, www.brnl.in and a link to the said Policy has been provided elsewhere in this Annual Report.

As on March 31, 2023, two subsidiaries of your Company, Solapur Tollways Private Limited (STPL) and Guruvayoor Infrastructure Private Limited (GIPL) are the Material Unlisted Subsidiaries of your Company, as per Regulation 16(1)(c) of the SEBI Listing Regulations.

POLICY AGAINST SEXUAL HARASSMENT AT WORKPLACE

Your Company is committed to provide and promote a safe, healthy and congenial atmosphere irrespective of gender, caste, creed or social class of the employees. Your Company in its endeavour to provide a safe and healthy work environment for all its employees has developed a policy to ensure zero tolerance towards verbal, physical, psychological conduct of a sexual nature by any employee or stakeholder that directly or indirectly harasses, disrupts or interferes with another?s work performance or creates an intimidating, offensive or hostile environment such that each employee can realize his/her maximum potential.

Your Company has put in place a ‘Policy on Prevention of Sexual Harassment? as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules made thereunder. The Policy is meant to sensitize the employees about their fundamental right to have a safe and healthy environment at workplace. As per the Policy, any employee may report his/ her complaint to the Internal Complaint Committee constituted for this purpose. The said Policy is available on your Company?s website, www.brnl.in and a link to the said Policy has been provided elsewhere in this Annual Report.

During the year under review, no cases of Sexual Harassment of Women were reported.

WHISTLE BLOWER POLICY (VIGIL MECHANISM)

Your Company has formulated a Whistle Blower Policy incorporating the provisions relating to Vigil Mechanism in terms of Section 177 of the Companies Act, 2013, and Regulation 22 of SEBI Listing Regulations in order to encourage Directors and employees of your Company to escalate to the level of the Audit Committee, any issue of concerns impacting and compromising with the interest of your Company and its stakeholders in any way. Your Company is committed to adhere to highest standards of ethical, moral and legal business conduct and to open communication, and to provide necessary safeguards for protection of employees from reprisals or victimization, for whistle blowing in good faith.

The Company has also designated whistleblower@brnl.in, an e-mail ID for providing access to the employees of the Company to disclose any unethical and improper practice taking place in the Company for appropriate action and reporting. The said Policy is available on your Company?s website, www.brnl.in and a link to the said Policy has been provided elsewhere in this Annual Report.

No complaints were reported under the Whistle blower Policy during the year under review.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY?S OPERATIONS IN FUTURE

During the Financial Year 2022-23, no significant and material orders have been passed by Regulators or Courts or Tribunals, impacting the going concern status and your Company?s operations in future.

AUDITORS

Based on the recommendations of the Audit Committee and the Board of Directors, Messers S.S. Kothari Mehta & Company, Chartered Accountants, were re-appointed as the Statutory Auditors of the Company for a second and final term of five consecutive years, to hold office from the conclusion of 15th AGM till the conclusion of the 20th AGM of the Company.

Further, vide notification dated 7th May, 2018 issued by Ministry of Corporate Affairs, the requirement of seeking ratification of appointment of statutory auditors by members at each AGM has been done away with. Accordingly, no such item has been considered in notice of the 16th AGM.

Pursuant to provisions of Section 143(12) of the Companies Act, 2013, the Statutory Auditors have not reported any incident of fraud, during the year under review, to the Audit Committee of your Company.

AUDIT QUALIFICATIONS

M/s. S.S. Kothari Mehta & Company, Chartered Accountants and the Statutory Auditors of the Company have given a modified opinion on the Standalone and Consolidated Financial Statements of the Company for the Financial Year ended on 31st March, 2023 w.r.t. non-recognition of interest on Rs. 7,000 lakhs from July 01, 2019 onwards which, as per the statutory Auditors, is not in compliance of Ind AS 1 ‘Presentation of Financial Statements? read with Ind AS 109 ‘Financial Instruments?. Due to this, loss before tax of the company for the quarter ended March 31, 2023 has been understated by Rs. 220.07 lakhs and loss before tax of the Company for the year ended March 31, 2023 has been understated by Rs. 892.50 lakhs and the current liabilities as at March 31, 2023 has been understated by Rs. 3349.93 lakhs.

The Board?s Comment on the modified opinion given by the Statutory Auditors of the Company on the Standalone and Consolidated Financial Statements of the Company for the Financial Year ended on 31st March, 2023 has been suitably covered under notes to Accounts forming part of the Annual Report viz. note no. 16(ii) of the Standalone Financial Statements.

Further, the Auditors have also provided for "Emphasis of Matter" and "Key Audit Matters" (KAM) in the Auditors? Report, which are self- explanatory.

The Code has been made available on the Company?s website www.brnl.in.

CORPORATE GOVERNANCE

Your Company strives to achieve highest standards of Corporate Governance and to take necessary steps at appropriate times for enhancing and meeting stakeholders? expectations while complying with the mandatory provisions of Corporate Governance.

As required under Regulation 34(3) of the SEBI Listing Regulations, 2015, read with Schedule V thereto, a separate section on Corporate Governance and a Certificate from M/s. M.R. & Associates, Kolkata - Practicing Company Secretaries, confirming compliance with the requirements of Corporate Governance, forms part of this Annual Report.

APPLICATION FILED BY IL&FS FINANCIAL SERVICES LIMITED AGAINST THE COMPANY UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

IL&FS Financial Services Limited (IFIN), which had extended a Term Loan facility amounting to Rs. 70 Crores to your Company had filed an application u/s 7 of the Insolvency and Bankruptcy Code, 2016 against your Company before the Hon?ble National Company Law Tribunal (NCLT), Kolkata claiming its overdues.

Your Company also has a receivable of Rs. 114.19 Crores from IL&FS Group Company viz. IL&FS Transportation Networks Limited (ITNL). Hon?ble National Company Law Appellate Tribunal (NCLAT) has granted moratorium on recovery of such claims against all IL&FS Group Companies, including IFIN and ITNL.

Your Company has initiated appropriate measures for set off of this payable and recovery of the balance amount.

Further an application has been filed by IL&FS on July 18, 2023 before the Hon?ble National Company Law Appellate Tribunal, New Delhi seeking an approval for unwinding / collapse of the transactions entered into with "third party borrowers" (which would include your Company) as against the dues of the relevant IL&FS group company "final borrower" (which in this case means ITNL), and further restricting the accrual of interest upto cutoff date i.e October 15, 2018. In view of this, your Company has filed an application before Hon?ble NCLT Kolkata, praying for dismissal of section 7 application.

The case is still pending before the Honorable Tribunal.

APPLICATIONS FILED BY ADMINISTRATOR OF SREI EQUIPMENT FINANCE LIMITED UNDER SECTION 60(5) AND 66 OF THE INSOLVENCY AND BANKRUPTCY CODE, 2016

1) Reserve Bank of India (RBI) vide its Press Release dated 4th October, 2021 superseded the Board of your Company?s Corporate Promoter SREI Infrastructure Finance Limited and its Wholly Owned Subsidiary SREI Equipment Finance Limited and appointed its Administrator in both of these Companies.

Subsequently, your Company has received a Notice of Motion by Administrator of Srei Equipment Finance Limited preferred before the Hon?ble National Company Law Tribunal, Kolkata Bench (NCLT) in the matter of Reserve Bank of India vs. Srei Equipment Finance Limited wherein the Company and its subsidiaries inter alia have been made a party amongst multiple respondents and the respondents have been alleged of fraudulent loan transactions as per section 60(5) and 66 of the Insolvency and Bankruptcy Code, 2016, based on a Transaction Audit Report relied upon by Srei Equipment Finance Limited.

2) Your Company and its subsidiaries have filed their respective counter affidavits in the matter which is yet to be heard by Hon?ble NCLT.

Your Company has received an application filed by the Administrator of Srei Equipment Finance Limited under section 60(5) and 66 of the Insolvency and Bankruptcy Code, 2016, before the Hon?ble National Company Law Tribunal, Kolkata Bench (NCLT) in the matter of Reserve Bank of India vs. Srei Equipment Finance Limited wherein Your Company inter alia has been made a party amongst multiple respondents and it has been alleged that your Company along with some more respondents, have indulged in round tripping of funds.

In the opinion of the Board, the findings and allegations in the Report submitted are not based on proper appreciation of facts and that the said report is unilateral without affording any opportunity to the Company for discussion.

Your Company is taking necessary legal steps in this regard.

GENERAL DISCLOSURES

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions w.r.t these items during the year under review:

• Issue of equity shares with differential rights as to dividend, voting or otherwise;

• Issue of sweat equity shares;

• Your Company does not have any scheme of provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees;

• There was no revision in the Financial Statements;

• There was no change in the nature of business; and

• There was no one time settlement done by the Company for the loans availed from Banks or Financial Institutions.

ACKNOWLEDGEMENT

Your Directors would like to express their appreciation for the excellent support and co-operation received from Financial Institutions, Bankers, National Highway Authority of India (NHAI), Ministry of Corporate Affairs (MCA), Registrar of Companies (ROC), EPC Partners and SPV Partners and other stakeholders during the year under review. Your Directors also place on record their deep appreciation for the valuable contribution made by the Company?s employees and look forward to their continued cooperation in realization of motto of the Company, "Behtar Raste, Badhta Bharat", in the years to come, as a Key partner of "MAKE IN INDIA" plans.

		On behalf of the Board of Directors
		For Bharat Road Network Limited
	Brahm Dutt	Bajrang Kumar Choudhary
Place : Kolkata	Chairman	Managing Director
Date : 12th August, 2023	DIN: 05308908	DIN: 00441872