ircon intl Management discussions

services on a lumpsum turnkey, EPC and item-rate basis for 29 various infrastructure projects. To boost_coal_evacuation from states like Odisha, Jharkhand & Chhattisgarh, IRCON is executing coal connectivity projects in joint venture with other CPSEs under the Ministry of Coal. In addition to this, IRCON executes projects on Build, Operate and Transfer (BOT) mode and Hybrid Annuity Mode (HAM) by leveraging the financial strength of the Company to build long term wealth.

IRCON, a prominent public sector construction company in the country, has established itself as a leader in Transportation Infrastructure, particularly in the execution of Railway Projects. The Company is renowned for its high-quality solutions, unwavering commitment, and consistent performance.

Over the past 47 years, IRCON has successfully completed numerous significant construction projects, both domestically and internationally. The Company has actively pursued a strategy of diversification, expanding its presence in various sectors and geographical locations. While IRCON ventured into the field of Solar Power Development recently, its primary focus and core strength have always remained firmly rooted in the railway sector.

The Company has consistently paid dividends to the government, highlighting its financial stability and success and is amongst the few construction companies in the public sector to have earned substantial foreign exchange for the country.

Overtheyears,IRCONhasexpandeditsbusinessfootprints in different geographies such as Algeria, Afghanistan, Bangladesh, Bhutan, Brazil, Indonesia, Iran, Iraq, Liberia, Malaysia, Mozambique, Myanmar, Nepal, Nigeria, Saudi Arabia, South Africa, Sri Lanka, Turkey, UK, and Zambia. So far, the Company has completed over 128 projects in 25 countries across the globe, and more than 400 projects in India. In the domestic market, it specializes in working in difficult terrains and disturbed regions. Furthermore, it is an active participant in prestigious nation-building projects.

While IRCON has its presence in many states in India, it intends to further expand its domestic operations across the nation as part of its business growth model.

LEGAL STATUS AND AUTONOMY

IRCON is a Schedule ‘A, and a Mini Ratna-Category-I public sector listed company. It is a legal entity separate from the Government, and is a lawfully, functionally, and financially autonomous Company that operates under the corporate laws as an independent commercial enterprise. The Company does not receive any budgetary or financial support from the Government and is not dependent on the Government for any aid or assistance. However, the

Government of India through the Ministry of Railways and the Department of Public Enterprises under the Ministry of Finance monitors the Companys performance through a system of Memorandum of Understanding (MOU). It reviews the targets to be achieved every year as part of accountability to the Parliament in respect of all government companies. The Government issues guidelines from time to time to regulate and bring about some uniform pattern in the functioning of the Company as a public sector enterprise. The Promoter of your Company i.e. the President of India holds 73.18% of the total paid-up equity share capital of the Company, as on March 31, 2023. The Government of India (GOI) had disinvested 10.53% paid-up equity share capital through Initial Public Offer (IPO) in September 2018. Further, in March 2021, through Offer for Sale (OFS) GOI divested 16% paid-up equity share capital, the Company is compliant with the Minimum Public Shareholding (MPS) requirements specified in Rule 19(2) and Rule 19A of the Securities Contracts (Regulation) Rules, 1957. As per 2022 edition of USAs Engineering News Record (ENR), IRCON is the only Indian PSU to make it to the list of top 250 International Contractors as well as under top 250 Global Construction Contractors. Further in the Business Standard BS 1000 Annual Magazine released in March 2023, IRCON has been ranked 164 in 2022 by total revenue, and ranked 7 in terms of sector performance under the ‘Construction and Infrastructure Sector. IRCON is also ranked 226^th in 2022 in the list of fortune India 500.

BUSINESS UNITS / DIVISIONS

Major business units / divisions of IRCON are as follows:

1. Civil Engineering Department

IRCON has established itself as a prominent construction organization in the country, with the Civil Engineering Department serving as the backbone of the Company and generating a significant portion of its revenue. It plays a pivotal role and provides leadership in the successful execution of large-scale composite projects. The department input and leadership are essential for the smooth implementation of the numerous projects awarded to IRCON.

This department is led by a highly experienced senior management team, consisting of professionals from renowned Engineering and Business Schools. They are supported by a large group of motivated and skilled Civil Engineers who have graduated from prestigious institutes

like IITs and NITs. As on March 31, 2023, there are 690 Civil Engineers in the department, accounting for approx. 50% of the total staff strength.

IRCON is committed to incorporate the latest technology in project execution to ensure timely and cost-effective delivery. With its highly qualified and experienced

workforce, the Company has significantly enhanced its competitiveness in the construction industry. It has an impressive track record of growth and expansion in various construction domains, including Railways, Highways, Bridges, Flyovers, Airports, Commercial & Industrial Buildings, Tunnels, Water treatment Plants, Residential Quarters, and more. IRCONs Civil Engineers are adept at working in remote areas, both in India and abroad, utilizing advanced Project Management Tools such as Primavera, TILOS, and MS Project. They are also trained in the latest surveying techniques, including GPS Surveying, Aerial LIDAR Surveying with Drones, and Total Station Surveying.

The department has successfully completed numerous mega projects, demonstrating its competency in delivering projects such as the High-Speed Railway

Line in IRAQ , Jamuna Bridge Rail Link-II in Bangladesh, the Double track project between Seremban & Gemas in Malaysia, the Upgradation of Railway Lines in the Northern Province of Sri Lanka, the completion of the Qazigund – Baramulla New BG Railway Line in J&K, and the completion of the 11.2 km Pir Panjal Tunnel, the longest transportation tunnel in India, in J&K. IRCON is the only public sector undertaking (PSU) to connect the rail network in the J&K States valley region.

The department has developed expertise in tunneling in the Himalayas, utilizing advanced technologies such as NATM. It takes great pride in having more than 200 trained tunnel Engineers and successfully completing over 100 km of tunnel mining in the challenging geology of the Himalayas. Another significant tunnel, the 12.75 km long tunnel on USBRL Project, is nearing completion, which will be the longest transportation tunnel in the country.

With its extensive pool of experienced Civil Engineers and its accomplishments in tunneling through the challenging geology of the lower Himalayas (such as the USBRL in J&K State and Sivok Rangpo in West Bengal & Sikkim), IRCON has emerged as a pioneer in the field of tunneling in India.

2. Design and Development Cell

IRCONs Design and Development Cell (D.D. Cell) is dedicated to develop in-house civil designs & review designs submitted by consultants duly addressing safety, durability etc. as per all the relevant CODAL provisions, value engineering, optimisation of design, estimation of quantities for bidding for various big-ticket national & international projects and other civil engineering solutions to most of IRCONs projects. Sophisticated design softwares such as Bentley Open Rail/Open Roads (for Alignment Design), STAAD Pro & MIDAS (For Structural design and Bridge Design), IITPAVE & KGPBACK (Pavement & Overlay Design), SLIDE (For Slope Stability Analysis of Soil) besides others are being used for developing design and corresponding drawings are developed with the help of efficient CAD Engineers.

The in-house design team has extensive experience in various areas including Alignment Design, Bridge Design, RCC/Steel Structures Design, Buildings Design, Highway Pavement Design, Geo. Technical Solutions and Hydrological Studies etc. The in-house design team comprises highly experienced Civil Engineers who have graduated from top ranking Engineering Colleges of India such as IITs, NITs and other reputed colleges. The team is ably supported by other departments viz. civil engineering, electrical and signaling as and when required.

Through DDC, IRCON is member in the following code/ standard committees and shares the knowledge and contributes in developing/modifying codes/standards:

• IS Codal Committee CED54: concrete reinforcement sectional committee: Standardization in the field of reinforcement for concrete including pre-stressing steel

• Standardization of Bridge Girders: Designing Long Span Steel based road bridges, convened by Ministry of Steel, Government of India.

IRCON Design Team has been extensively involved in finalizing designs of various domestic projects as well as international projects viz. Mokama Viaduct Project, Mahanadi Coal Rail Linked project, ROBs at Shalimar & Santragachi project, Shivpir-Kathautia Rail line project, Agartala- Akhaura (India Portion) Railway Viaduct Project, Chhattisgargh East West Rail project Gevra-Pendra Section, Sivok Rangpo Railway line project, Maho-Omanthai railway line project in Sri-Lanka, Gurgaon-Rewari Highway Project, DFCCIL CTP-12, CERL Dharamjaigarh-Kharsia section including spur line and feeder line. Some of the noteworthy projects done earlier wherein DD Cell has been involved in providing design solutions are: 2-tier Road cum Railway Bridge across River Ganges in Bihar at Digha Ghat, Bikaner-Phaloudi Road Project, Buildings of RAPDRP, Jammu, Railway link in Northern province of

Sri Lanka, Railway Bridges of Jaynagar Bardibas Railway Project (India and Nepal), Seremban-Gemas Electrified double track Railway Project (SGEDT) in Malaysia, Beira Rail Project in Mozambique including Dona Ana Bridge across the mighty River Zambezi etc.

The team has also played an important role in quantity estimation while bidding for various major rail/road projects viz 4-Laning of NH in districts of Darjeeling & Jalpaiguri, Maldives Harbor Project, Sudhmahadev – Dranga Tunnel of approx. length 4.5 Km and its approach roads on Chenani Sudhmahadev-Goha road portion, Vailoo Tunnel of approx. length 10.00 Km under Sinthan Pass and its approach roads on Goha – Khellani – Khanabal road portion, HRIDC C-4, C23 Project, High-Speed Rail Project C4, C5, C6 & C7 Packages, Gurgaon-Rewari Highway Project, DFCCIL CTP 1, 2, 3, 3A, 11, 12 Packages, Vadodara-Kim Expressway Pkg-ll, Davanagere-Haveri in Karanataka, Shivpuri-Guna Highway Project, Etihad Rail in UAE, various projects in Bangladesh, Maldives, Iran, Ethiopia, Oman etc.

3. Electrical Department

As leading turnkey project execution Company in Railway Sector, Railway Electrification wing supports the project in end-to-end solution. The Electrical Department provides expertise in 25 kV Railway Electrification Works, HT Grid & Traction Sub-station of voltage classes up to 400 kV, EHT Transmission line, EHV cabling work, Industrial Electrification of mega industrial plants & Loco Sheds, Power supply distribution network for Cities, Metro Railways (AC & DC Systems) and Airports, Tunnels Power Supply and Ventilation System, Electrification including Power Supply sub-stations in Metro Railways and Renewable Solar Energy works.

IRCON undertook its first major Railway Electrification Project of Delhi – Ring – Railway in 1980 and offered environment friendly electric traction services to passenger in Asian Games organized in 1982. Thereafter, in its journey of 4 decades, the company has executed more than 8000 TKM of Railway Electrification work in India & abroad and established itself as leader in the market.

IRCON has also entered into Renewable Energy business and is executing ‘Setting up of 500 MW Grid Connected Solar Power Plant under the Central Public Sector Undertaking (CPSU) Scheme Phase-II (Government Producer Scheme) through new technology Monocrystalline Passivated Emitter and Rear Cell (PERC) Bi-facial Solar Photo Voltaic (SPV) Modules with Tracker and will supply approximately 1076 million Units per year to Railways.

IRCON has executed many H.T. sub-station works up to 400 kV in India and abroad. Majority of sub-station works in all three phases of DMRC are executed by IRCON. IRCON has also acquired capability to execute Gas Insulated Sub-station (GIS) and Transmission Line projects up to 220 kV.

Tunnel Ventilation and its power supply in long Rail Tunnel is highly technical and challenging work which was successfully executed by IRCON in Pir-Panjal Rail Tunnel, J&K (11.2 km T80 – longest railway tunnel in Asia) wherein successful commissioning was done by IRCON for tunnel ventilation and safety (Electro Mechanical) works. Further, ongoing works include about 54 km of Electro Mechanical works in railway tunnels T77/74R, T49/50, T48, T14, T15 connecting Kashmir valley to India. Complete turnkey E&M work includes design, planning, project management, testing, commissioning, operation, and maintenance facility for Electrical Works (complete HT and LT works), Tunnel Ventilation System (TVS), Fire Fighting Systems, Operational Management and Control System (SCADA). Furthermore, about 38.6km of Electro Mechanical works in railway tunnels T1 to T14 connecting Sikkim to India is also under planning stage. IRCON has the experience of executing railway electrification work at high altitude as well (1650m above msl) which is being implemented in Indian Railways for the first time for USBRL Project at J&K between Baramulla to Banihal including tunnel T80 with Flexible Overhead catenary system. Moreover, IRCON is also executing about 38km of Rigid Overhead Catenary system (ROCS) works in J&K which is also being implemented for the first time in Indian Railways. With the experience and expertise of the Company in the Electrical field, it has also entered into a new field of Indias first Semi-High Speed Rapid Transit System, and is executing electrical works in Delhi-Meerut Section for National Capital Region Transport Corporation (NCRTC). For the Delhi-Meerut Section of NCRTC, a total of approx. 10 kms of 220 kV power transmission line, 34 kms of 33 kV & 1.2 kms of 25 kV Cabling have been done along with energization of 02 Nos. Receiving Sub-Stations (RSS) of 220/33/25 kV at Ghaziabad & Muradnagar including 05 Nos. of Auxiliary Sub-Stations (ASS) of 33/0.415 kV at Ghaziabad, Guldhar, Sahibabad, Duhai Station & Duhai Depot. Furthermore, Overhead Equipment (OHE) of 17 kms with a design speed of 180 kmph has also been commissioned from Sahibabad-Duhai including Duhai Depot. For the prestigious ‘Mission Railway Electrification of the Ministry of Railways (Government of India), IRCON is executing more than 2900 RKM and 32 sub-station works in various Railway Electrification works, wherein more than 900 RKM & 06 Nos. Traction Sub-Stations (TSS) have been commissioned.

4. Mechanical Engineering Department

Mechanical Engineering Department is a team of proficient, experienced as well as young, dynamic and energetic mechanical engineers. It has the capability to design, install and commissioning of new rolling stock production unit, workshop or diesel shed apart from re-engineering the existing units with the objective of increased production / out- turn in an efficient and economical ways by having the optimum utilization of resources as per the requirement of the end use customer from domestic as well as foreign market. Team is also capable for handling operations and maintenance of Rolling assets.

Our team delivers the projects in time even with crashed target as per the customer requirement by utilizing the latest project management tools such as MS Project, Six sigma, Primavera etc. along with the mobilizing of physical resources across the globe.

Recently, IRCON has bagged a prestigious High Speed Rail project i.e. MAHSR-T2 project from NHSRCL. This High Speed Rail Project is being executed by Govt. of India under the expert guidance of Japanese Consultant from Shinkansen Bullet trains. As per the methodology adopted by the Japanese consultant all the track machineries to be deployed in the construction of Track & Track related works are either Japanese machineries or machines developed by Japanese Engineers/ manufacturers for track related works. IRCON, Mechanical team has developed these critical machineries in-house under Make-in-India program by guiding Indian Manufacturers on the technical design and specific functional requirement of the track machines. In this endeavor, IRCON has not only developed Indian manufacturers at par with Japanese design but also saved a significant cost to IRCON by getting these track machineries manufactured in India instead of procuring these machines from Japan. Some of these track machineries are Rail Feeder cum drawer Car, Track Motor Car, Trolley/ Wagons

& Flash Butt Welding machines. These machines are specially developed in the same line as that of Japanese technological requirements. This department has not only setup the Modern and State-of-the-Art Stainless Steel Coach Production units at Rai-Bareli in a record time and beating the targets by a leap, but also upgraded the diesel sheds so that it can simultaneously home Diesel as well as Electric Locomotives.

Coach production facility at Rai-Bareli is an engineering marvel and an integrated unit having all the facilities for turning out a finished coach from the basic raw materials such as rolled steel sheets. This facility has Coach/Shell fabrication Line, Robotized welding equipped Bogie Fabrication Shop, furnishing, finishing shop, Wheel Shop, State of the art Paint Shop along with all the subsidiary systems such as Material auto storage and retrieval system etc., Power Substation along with one of the largest Solar park of 3 MW in the area, residential colony for working personnel as well as for top management along with 100 bedded hospital, cricket stadium, athletic track, FIH certified Hockey stadium and 18 hole golf course apart from other facilities. This makes the unit as self-sustaining unit.

Exporting of locomotives, freight wagons and passenger cars along with leasing and maintenance of locomotives, track machines are other key capabilities of the department. Thus our mechanical department is having expertise in all domain areas of Rolling Stock asset management i.e. right from areas of construction of facilities to maintenance of assets along with Business Process Re-engineering of existing facilities. This experience has been gained by implementing large projects not only in India but also at abroad for various government and/or multilateral funding agencies & other organizations.

Apart from above, projects undertaken by the department includes Detachment free rake examination facilities at Exchange Yard of Bondamunda (SER), Setting up of Wheel Shop at Rail Coach Factory, Kapurthala; Augmentation of Diesel Loco Shed, Vishakhapatnam; Supply of 10 (Ten) units YDM4 (Meter Gauge) Locomotives to Royal Railways, Cambodia; Supply of 6 (Six) units 2300HP AC/ DC (Broad Gauge) Locomotives with Co-Co bogies to Sri Lankan Railways, Sri Lanka; Leasing and Maintenance of Diesel Loco to KTMB, Malaysia where in more than 85% availability of rolling assets has been obtained for a span of more than two decade, this itself reflects exceptional capability of IRCON for maintaining rolling assets.

5. Signal & Telecom Department

Since its inception in 1976, IRCON has been providing turnkey Signal & Telecom (S&T) solutions for Railways in India and abroad; IRCON has unique distinction of executing Signaling & Telecom (S&T) projects in various countries as per their local codes, manuals and standards. With in-house design, construction and project management capabilities, all projects have been delivered satisfactorily on agreed timelines. IRCON has been executing number of state-of-the-art S&T projects, starting from Relay Interlocking to Electronic Interlocking (EI), Automatic Train Protection (ATP), Centralized Traffic Control (CTC) systems, Integrated Tunnel Communication System(ITC). In the year 2022-23, IRCON commissioned Signalling Works at 60 Stations of Indian Railways as part of Doubling, New Line, RE Modifications, Replacement works. IRCON has been at the forefront of technology in execution of telecom works, and executed Telecom Projects of Synchronous Digital Hierarchy (SDH), Multi Protocol Label Switching (MPLS) Technologies in Sri Lanka, Bangladesh, Nepal, Malaysia and India. IRCON has also executed IP-EPABX, IP-CCTV, PA system and Integrated Passenger Information System (IPIS) Works.

6. Business Development Department

IRCONs Business Development Department has a dedicated team to drive order books, develop and evaluate bidding strategies as well as to identify new business opportunities to generate and nurture future business of the Company in the fast-paced competitive environment.

In the past years, Business Development Department of IRCON has secured projects in railway, highway, tunnel, metro, solar, electrical & mechanical, signaling & telecommunication, buildings etc. both in competition and nomination basis. The Railway Board has changed its policy and works are now being awarded through open bidding process. Accordingly, IRCON through its Business Development department competes with the other players including private players and participates in tenders of various railways and secures works on the basis of competitive bidding.

In the year 2022–23, the Business Development Department of IRCON has secured 4 Projects. This includes development of two New Industrial Estates in Union Territory of Jammu and Kashmir, the work for Signaling and Telecommunication System from Maho Junction (Including) to Anuradhapura (Excluding) in Sri Lanka under Indian Line of Credit worth Rs. 21.75 Crore, Establishment of Railway Siding along with Railway Station contagious to Mine Lease Boundary of Gare Pelma Sector-III Coal Mine worth Rs. 5 Crore and Detailed Engineering

& Project Management Consultancy (PMC) Services for "Development of Rail Infrastructure for proposed 02 nos. RLS (20 MTY) for Ananta OCP of Jagannath Area, MCL at modified route at Talcher worth Rs. 4.21 Crore. The Department is also engaged in the process of formation of Strategic MOUs and alliances to explore new business opportunities and to frame and review the Corporate Plan of the Company.

The department is aggressively pursuing infrastructure projects in countries such as Bangladesh, Maldives,

Malaysia, Myanmar, Nepal, Sri Lanka, Middle East and African Countries which will help in fostering future growth of IRCON.

7. Estate Management Department

Over the years, from diversification into entire spectrum of infrastructure your Companys nature of business has also changed from a construction company to a project development and operation company including, real estate and commercial operations among other activities. With the objective of growth in the Real Estate Business in medium and long terms viz., development of the plots, construction of buildings, leasing and / or sell out of the immovable properties and other matter related to the properties like tax and legal matters, IRCON has set up the Estate Management Department. This department is professionally managed and constituted to manage IRCONs existing real estate and undertake real estate development projects including property tax matters. Among real estate projects, IRCON has constructed many commercial buildings, institutional buildings, railway stations and townships etc. in India such as multi-storied commercial complexes for CIDCO in Navi Mumbai, 500 bedded Hospital in Bhopal, Veterinary Science Animal Husbandry college campus in Aizwal, three major residential townships at Jhansi, Bhopal and Allahabad for Ministry of Defense, projects connected to Pusa University, Banaras Hindu University, CIFE, Mumbai, Vashi Railway Station, Multi-Functional Complexes (MFCs), Rail Coach Factory at Kapurthala as well as at Raebareli etc. IRCON has developed its own corporate office which is a modern and smart office featuring all elements of Green Building. Foreseeing the growth in Real Estate Sector, IRCON has accumulated a large portfolio of real estate properties and assets in metropolitan cities such as Mumbai, Chennai, Kolkata, Bangalore, Noida and Gurugram etc. for commercial development. Your Company had acquired 8 plots in different sectors, on leasehold basis for 90 years, at NOIDA and has successfully Leased out 22,023 Sq. mt. of built – up space for Commercial and Office use. The Company has also developed property in Sector 32, Gurugram, Haryana and this property is registered with the trademark authorities in India as ‘IRCON INTERNATIONAL TOWER. About 2079Sq. mt. carpet Area of this property has been Leased Out to government agencies and balance available space is in the process of leasing out. Apart from the Office Spaces, IRCON International Tower, Sector-32, Gurugram, accommodates state-of-the-art 250 seats auditorium and training center equipped with latest equipment along with an accommodation facility.

FINANCIAL PERFORMANCE

During FY 2022–23, highest ever total income of the Company was achieved Rs. 0262 Crore as against Rs. 181 Crore in the previous financial year, thus showing an increase of 42.90%. More than 96.68% of the Companys total income i.e. Rs. 921 Crore has been recorded from operations which is 43.57% higher as compared to the operating turnover of Rs. 910 Crore of FY2022. Out of the total amount of operations, 4.15%, that is Rs. 11.84 Crore has been achieved through international projects. The Profit Before Tax (PBT) and Profit After Tax (PAT) have increased by 44.75% and 42.83%, respectively and it stood at Rs. 83 Crore and Rs. 77 Crore, respectively.

The details of interim dividend declared and paid and proposed final dividend for FY 2022–23 for consideration and declaration by the shareholders, over and above the interim dividend at the forthcoming AGM are mentioned in the Directors Report under ‘Financial Highlights. Further, the details of significant changes (that is, change of 25% or more as compared to FY 2021–22 in the key financial ratios) along with detailed explanations thereof forms part of the Financial Statement.

Key Financial Ratios

The details of significant changes (that is change of 25% or more as compared to FY2022 in the key financial ratios) along with detailed explanations thereto is placed below:

During FY 2022–23, the Company has complied with the guidelines prescribed by the Accounting Standards while preparing the financial statements (standalone and consolidated), and no deviation has been made in the reporting of the financial information.

The movement is primarily on account of incremental income generated in the current year being higher vis-?-vis the increase in net-worth.

SECTORAL PERFORMANCE

During FY2022–23, around 93.87% of the revenue earned by IRCON is contributed by the Railway sector. The main focus business area for IRCON is Railways, however, the Company is also concentrating on Highways business, which generates approximately 5.88% revenue and remaining from other areas such as electrical and building works.

SECTOR WISE PERFORMANCE:

(_ in Crore)

SEGMENT WISE PERFORMANCE:

(_ In Crore)

ORDER BOOK POSITION

Ministry of Railways had earlier changed its policy of awarding work on nomination basis to railway PSUs, the Railway works were being awarded by bidding process among railway PSUs. Later, in October 2021, the Ministry of Railways has revoked this policy of competition amongst the PSUs and open tendering has been introduced for awarding Railway works.

IRCONs order book, as on March 31, 2023, stood at Rs. 5195 Crore (approx.) with Rs. 6243 Crore value of work in Railways sector and Rs. 985 Crore value of work in Highway sector.

Out of the total order book, Rs. 8470 Crore value of work secured through competitive bidding and Rs. 6725 Crore value of work secured through nomination basis.

During the year, your Company completed 02 projects in India, the details of which have been mentioned in the Directors Report.

RESPONSE TO COVID 19

The coronavirus (COVID-19) has created the biggest global crisis, sending shock waves through health systems, economies, and societies around the world. It continues to impact key geographies that we operate in, with almost all countries are reporting second wave of infections.

The Company is following the guidelines issued by the government for prevention of spread of COVID-19, sanitizers are available at all offices / projects of the Company, social distancing, wearing of mask etc. are also followed up. Further, the Company initiated several measures to help its employees and their families, including establishing COVID care centers, vaccination centers, and providing them access to medical care facilities.

The actual impact of COVID-19 pandemic may be different from that which has been estimated, as the COVID-19 situation evolves in India and globally. The Company will continue to closely monitor any material changes to future economic conditions.

1. Strong Order Book:

The company has outstanding executable order book of more than Rs. 5,000 crore as on 31.03.2023. This order book gives revenue visibility of more than 3–4 years, which shows great stability of the business.

2. Debt Free Company:

IRCON is technically debt free company. It had borrowing of Rs. 15 crore as on 31.03.2023, which was actually a pass-through entry and ultimate liability lying with Ministry of Railways including interest payable. After closure of the

financial year the whole amount has been repaid and now company is a debt free company on standalone basis.

3. Sturdy Cash Position:

IRCON has cash and bank balance of Rs. 785 crore as on 31.03.2023, out of which almost 18% is its own cash. The cash and bank balance of the company constitute almost 35% of the total assets, which is very rare in infrastructure sector.

4. Experienced Manpower:

Technical manpower is highly skilled and experienced in their respective fields. Top and middle management of the company is majorly from Ministry of Railways and has expertise on project executions.

5. Diversified Business Segments:

The company is working in diversified sectors such as railways, highways, electricals, renewable energy etc. This diversity in business reduces the industry risk and business cyclical risk.

6. Wide Geographical Presence:

IRCON has its wide presence domestically as well as internationally. Currently, the company is operating in 20 states in India and has its presence in Algeria, Sri Lanka, Myanmar, Nepal and Bangladesh.

7. One Stop Solution (C2C):

The company provides one stop solution to its clients. It undertakes projects from concept to commissioning.

8. Execution of Work:

The Company generally execute the works with its own experienced man power and plant & machinery available with the Company.

1. Inherent constraint of being a PSU:

Being a government company, it has to follow several guidelines, which are not meant for private sector companies. Private sector companies are more flexible and takes faster decision due to less stringent procedures.

2. Exposure to geo political risk due to geographical presence:

IRCON is working in five foreign countries, which gives it exposure to geo political conditions of that country. Further, it is also exposed to diplomatic relations with the countries its operates.

1. Government thrust on Infrastructure:

Government is committed to develop infrastructure and coming with various polices. There is huge potential in infrastructure sector. Being one of the major players in infrastructure sector, there is great opportunities available in the sector.

2. Governments emphasis on renewable energy:

In the recent time, we have witnessed energy scarcity. Government is encouraging green energy and coming up with various schemes. IRCON has diversified its business into growing segment of green energy with incorporation of its subsidiary company. Governments emphasis on renewable energy gives immense opportunity to IRCON.

3. National Infrastructure Pipelines (NIP):

Government has launched National Infrastructure Pipeline (NIP) for FY 2019–25 to provide world-class infrastructure to citizens. The transport sector in India is expected to grow at a CAGR of 5.9 percent thereby becoming the fastest growing area of Indias infrastructure sector. There are 4676 opportunities available in 9 sectors under NIP.

4. National Rail Plan (NRP):

Indian Railways has prepared National Railway Plan to create a ‘future ready Railway system by 2030. The NRP is aimed to formulate strategies based on both operational capacities and commercial policy initiatives to increase modal share of the Railways in freight to 45% from 27%. Government has identified new dedicated freight corridor and high-speed corridors. The government has CAPEX plan of Rs. 5.02 Lakh Crore excluding Rolling Stock of Rs. 3.18 Lakh Crore under NRP 2021–2051.

1. Withdrawal of Government policy regarding allocation of work on nomination basis:

Earlier, the company was also securing the orders on nomination basis from the Ministry of Railways. However, recently, government has changed its policy and now IRCON has to compete with other PSUs as well as private companies to secure the orders. However, the company has been scuring many projects through competitive bidding.

2. High volatility in Commodity Prices:

Due to geo political reasons and war situation arisen in Russia and Ukraine, we have observed high volatility and sharp increase in commodity prices such as oil, ferrous and non-ferrous metals, cement etc. which may impact profitability of the company in the short to medium term. However, the Company takes necessary steps like incorporating the price escalation clause in contract agreement to mitigate the price fluctuation.

3. Expectation of Global Slowdown:

In the recent time, inflation is going up and in some of the countries it is on multi decade high. To cope up with high inflation, central banks of all over the world are taking aggressive steps. In this inflationary environment, there is menace of global slowdown, which may negatively impact to infrastructure sector. However, as per IMF Report, despite of global slow down in Europe and UK, India is expected to grow. Though, IRCON is pursuing to get more international projects, most of its projects are under execution in India.

4. Increase in competition in the sector due to small players:

Increase in competition in a sector due to the presence of regional small players. It led cut throat price competition in the industry, which may lead margin pressure on the company. However, small players generally execute small size of projects whereas considering IRCONs expertise in niche area of tunneling, high speed, metro etc, it executes EPC contracts, thus may have least impact.

FUTURE OUTLOOK

IRCON has a long-standing reputation as one of the industry leaders in transportation infrastructure with proven expertise in railway projects. To uphold our reputation in the industry and to get improved profit margins, we intend to capitalize our advantageous position in the market both in terms of our expertise and financial strength. As we move ahead, we plan to build on our strategy of diversifying across industry segments through new engines of growth. We endeavour to enhance our portfolio with projects in the international markets to achieve healthy profit margins offered by these projects. Although, we continue to focus on the railway sector, through portfolio diversification we aim to hedge against risks in specific areas or projects and guard the Company against market variations resulting from business concentration in particular industry sectors and limited geographical regions.

We are confident that various infrastructure initiatives decreed by the Government of India will help us in fostering our future growth. We believe that we are well positioned to execute projects under these modes due to our strong technological capabilities and sound financial position. With sound experience and solid performance, we expect to see steady growth in our business with a rise in the number of projects that we undertake and improved profitability margins from these projects, for which our strategies are as follows:

Expanding Geographical Footprints in Domestic and International Markets: IRCON has actively concentrated on becoming a diversified infrastructure player, both in terms of sector and geographical coverage and has extended its expertise into transportation engineering, civil and industrial construction, renewable power and other infrastructure projects. Currently, the Company is executing the projects in twenty states domestically and five countries internationally. With the established presence in the Indian market, IRCON further intends to cover the unexplored areas within the country. IRCON believes that this will help in enhancing its portfolio with projects proposed by the Government of India would further consolidate its position in the infrastructure sector. IRCON plans to build its strategy of diversifying across industry segments through new engines of growth. Also, while it continues to focus its efforts in the railways sector, through portfolio diversification, it hopes to hedge against risks in specific areas or projects, and protect itself from market variations resulting from business concentration in particular industry sectors and / or limited geographical areas. IRCON endeavors to enhance its portfolio with projects in the international markets to achieve healthy profit margins offered by these projects. With sound expertise and solid performance, increasing experience and success, the Company expects to see a steady growth in its business with a rate of expansion comparable to or better than the best in the construction industry.

The Company aims to persist its strategy of diversifying across industry segments and increase orders from international markets to capture healthier profit margins as compared to domestic projects.

Diversification in Renewable Energy Sector: IRCON is exploring new emerging areas for business diversification. As part of its diversification strategy, the company has entered into renewable power sector to establish 500 Mwh solar power plant with joint venture partner. With the government thrust on renewable power sector, there are immense opportunities in this sector and company is very hopeful to do well in this sector. Renewable power sector will ensure regular revenue and will also strengthen its profitability.

PPP Modes of Revenue Generation: IRCON is gradually moving from generating income only through individual projects to regularly generating revenue and profits through its Subsidiaries and Joint Venture companies (JVs). The Subsidiaries and JVs of IRCON are likely to generate revenue and profits on a sustained basis because of the continued operation of existing projects and new projects. The Companys goal is to move ahead from being a construction company to a diversified company having a portfolio of BOT, DBFOT, EPC and other contracts as well as project development and operation through Subsidiaries and JVs.

Active Focus of New Projects: IRCONs business growth is attributed principally to an increased bidding activity to procure large projects. With the Companys longstanding reputation, in-house capability and expertise, the Company bids for new projects in its niche areas of railway projects on a turnkey basis, tunnels, bridges, Dedicated Freight Corridor, Metro, High Speed Rail, Bullet Train track etc. Additionally, IRCON aims to capitalize on its advantageous position over its competitors, both in terms of proficiency and financial position to undertake large-high-quality projects driven by the growth of the Indian economy. The various initiatives promulgated by the Government of India will help in continuing the growth momentum for the Company. The Company is also endeavoring to increase its share in international market through EPC and PPP execution mode. The Company also endeavors to formulate strategic alliances both in the domestic and foreign markets with other major private players and participate in bids aggressively to further expand its horizon of business opportunities.

Favorable Financial Risk Profile: IRCONs financial profile indicates positive profitability margins and comfortable liquidity position, which has contributed to its operational performance. The Company intends to sustain its positive capital structure with minimum debt to enhance its turnover and profitability.

Sectoral Initiatives Undertaken by the Government:

Over the years, the Government of India has issued various macro-level and sectorial initiatives to improve the economy. The infrastructure sector has been one of the top-most priorities of the Government, particularly the Railway & Road sector. Union Budget of last few years also has focused its concern on infrastructure development and a large amount is reserved for capex in railway and road sectors. In the recent years, government is emphasizing to boost renewable power and we have seen considerable CAPEX in this sector. With the increased interventions of the Government to develop infrastructure, IRCON has been able to receive multiple opportunities for its business. The Company aims to capitalize on these opportunities by leveraging its established track record and diversifying its infrastructure know-how into transportation engineering, civil and industrial construction, renewable power and other infrastructure projects.

Attract and Retain Talent Pool: IRCON recognizes the importance of its talented employees and the role they play in the Companys success. It relies on them to operate the modern construction equipment, complete various tasks on its complex construction projects, and deliver quality performance to its clients on a demanding timeline. With an efficient human resource system, IRCON continues to focus on improving health, safety, and environment for its employees. It intends to further strengthen its workforce through regular on-job skill development and training programs. Additionally, IRCON aims to provide a congenial and safe working atmosphere to its women employees. In addition to these efforts, IRCON also intends to maintain a relatively low employee attrition rate and retain more of its skilled workers for its future expansion. This is done by providing better overall benefit packages and a safer and healthier working environment.

STRATEGIC MOUs AND ALLIANCES

Your Company from time to time enters into various strategic MOU to explore new business opportunities. In the FY 2022–23, IRCON entered into a JV with Cochin Port Authority for bidding for a proposed Harbour in a neighbouring country. Cochin Port Authority is a Corporate body under Major Ports Authority Act 2021 under Ministry of Ports, Shipping and Waterways.

Project Models: There are several high-value projects expected in the Highway sector on EPC, DBFOT, HAM and Annuity basis. IRCON has founded nine wholly-owned subsidiaries last year as SPVs for the execution of projects on BOT, DBFOT, and HAM basis and hold a strategic share in joint venture companies formed for coal connectivity projects in three states of India. The Company is geared up to undertake turnkey projects under several project execution models including EPC, HAM and Annuity basis.

Technological Advancements: The Company adopts advanced technology and construction methodology that ensure edge over competitors. It further improves operational efficiency, establishes credibility, enhances order book value and drive customer satisfaction. Furthermore, IRCON aims to accordingly train its employees to get familiar with trending technologies and is also exploring infrastructure projects that require the latest technology.

With the vision to venture in a new business area, IRCON participated in a bid for the development of a proposed harbour in a neighbouring country of India, for integrated facility to cater for docking/berthing facilities along with repair facilities for boats/vessels. The facilities broadly include a Berthing wharf (300m), Break water of about 1700 m, Slipway of 500T capacity with transfer bay, Repair work shops, Administrative Building/Maritime School, Storage shed, Helipad, Residential blocks for officers, Medical Inspection Room, Sports facilities along with other utilities.

RISK MANAGEMENT

IRCON acknowledges that operating in the construction sector exposes the Company to inherent uncertainties and risks. The volatility of this sector introduces various external and internal risks that can impact both the financial and non-financial outcomes. Recognizing the importance of an integrated approach to risk management, IRCON has established a comprehensive Enterprise Risk Management (ERM) framework.

IRCON has had a Risk Management System in place since 2007, with the Risk Management Policy (RMP) initially formulated in 2013. Over time, the RMP has been amended to align with the changing business environment and regulatory requirements. The latest revision of the RMP was approved by the Board in December 2021, with the aim of fostering a higher level of risk awareness across the organization, encouraging broader participation, and cultivating a sustainable risk-aware culture.

In accordance with the ERM framework and SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, IRCON has established a Board Level Risk Management Committee (RMC). This committee reports to the Board providing insights into risk elements and mitigation plans, among other responsibilities.

The RMCs primary functions include identifying key risk-bearing activities, assessing the gaps in risk potential compared to best business practices, identifying deficiencies in current business processes that may leave potential threats uncovered, establishing risk assessment control systems, reviewing risk assessment reports compiled by the Rapid Action Group (RAG), providing directions for improvements, and ensuring IRCONs preparedness for potential risks. The RMC is also responsible for formulating and reviewing the RMP, including the framework for identifying internal and external risks specific to the company, developing measures for risk mitigation and internal control systems, and monitoring implementation.

To ensure effective implementation of the Risk Management Policy, IRCON has established a Rapid Action Group at the Executive Director and Chief General Manager levels, along with business groups and internal audit teams. The Risk Management Policy, Risk Management Processes, and MIS report formats, including reports on Risk Management, have been developed in accordance with the ERM framework. Reports from the Rapid Action Group are submitted to the RMC for review. In line with the updated Risk Management Policy, the identification of critical risks, monitoring, review, mitigation plans, and corrective actions are now carried out through an Online Web-Based Risk Management IT Tool, which is reviewed by the RMC via the RAG for the Organizational Risk Repository.

In the Indian context, IRCON faces significant challenges in project execution, such as the non-availability of encumbrance-free land and delays in obtaining approvals for drawings and estimates. These factors pose risks of time and cost overruns, which are often uncompensated by the client. Additionally, the Company faces uncertainties in predicting project revenues, as they can vary due to various factors.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

A well-designed and consistently enforced system of operational and financial control plays a crucial role in protecting the Companys resources, ensuring the reliability of financial reports, and ensuring compliance with laws and regulations. It also helps in minimizing the possibility of significant errors and irregularities and facilitates their timely detection when they occur. IRCON has implemented an internal control mechanism and an Internal Audit Function that are appropriate for its size and business nature, aimed at enhancing operational efficiency and ensuring compliance with applicable laws, rules, and regulations. The Company has established policies and guidelines that optimize the delegation of authority to facilitate business processes.

To further strengthen the internal control system, the following measures have been implemented:

Internal Financial Control (IFC)

The Company maintains adequate Internal Control over Financial Reporting (ICFR) in accordance with the provisions of the Companies Act, 2013, which are effectively implemented. The controls are designed to ensure proper maintenance of accounting records, orderly conduct of business operations in accordance with company policies, protection of assets, prevention and detection of fraud and errors, and reliability of financial and operational information.

The internal financial control system, including ICFR, undergoes periodic reviews to ensure its alignment with evolving business needs. Any necessary changes are implemented to enhance its effectiveness. The management provides transparent disclosure of all financial information required for a comprehensive understanding of the Companys financial position and operations.

Internal Audit

The Company appoints experienced professional firms for conducting the Internal Audit of the Company and frequency of the Internal Audit is linked with the turnover and percentage of completion of each project.

The Company has developed and approved its own Internal Audit Framework, which outlines the scope of the audits. This framework covers various aspects, including financial accounting, financial reporting, tender and allied matters, project execution, procurement, subcontracting, statutory compliance, and more. Both the management and the Audit Committee periodically review the internal control and audit systems, taking corrective action as needed to ensure continuous improvement.

Furthermore, IRCON has an organizational chart in place, along with a system for delegation of power that is regularly updated. The Company also has a structured Fraud Prevention, Detection, and Control Policy (FPDC Policy) and a Whistleblower Policy, both approved by the Board of Directors. These policies provide a mechanism for making confidential e-complaints and help maintain a culture of integrity within the organization.

QUALITY, SAFETY, HEALTH AND ENVIRONMENT STANDARDS

IRCONisanISOcertifiedCompanyforQuality,Environment and Occupational Health & Safety Management Systems. The Company has implemented a Quality Management System in accordance with ISO 9001:2015. It has also implemented an Environmental Management System in accordance with ISO 14001:2015 and Occupational Health and Safety Management System in accordance with IS0 45001:2018.

QUALITY

IRCON is a pioneer Public Sector Organization in adopting the Quality Management System Certification in the domestic as well as International Markets. Quality Management System (QMS) has been successfully sustained and continually improved since 1996 when the Company as a whole was first certified for ISO 9002:1994 by TUV SUD Private Limited. We have continued the certification and sustained the system as per the latest version of Quality Management Standards, i.e. ISO 9001:2015 (by periodical re-certification audit after the expiry of every three years). Latest re-certification audit was conducted in September 2022, whereby the Company has been re-certified by TUV SUD South Asia Private Limited for a period of another three years, i.e. up to March 2026.

To overcome the COVID-19 impacts, IRCON adopted the latest technologies & digital solutions for the containment of COVID -19 & emerged as the Quality centric organization by ensuring the needs & expectations of their customers. In view of COVID-19 pandemic, the Company continued the initiative of sharing technical knowledge by adopting digital platform (i.e. Google Meet, Microsoft Teams etc.) on the topics like Load Test using Crown Anchor Reaction Method, EV2 Test procedures & interpretation, Cost Saving High Rise Retaining Walls, Application of Geosynthetics, Digital Management Techniques using Laser Scan, Geo Composite Cementitious Matt BIM

Solutions, Water Proofing solutions and many more technical as well as technological solutions prevailing in the core competence of the organization i.e. railways, highways, tunneling & other infrastructure projects. In addition to this, new initiative for attracting the participation from each & every employee within the organization, conducted the quality circle meeting with project professionals for ensuring better product delivery as well as quality. RACI matrix has been defined & implemented at our project sites for maintaining the Quality of Works. Standardization of Project Procedure Manual (PPM) along with the material testing plan and formats have been made available on the internal website of the Company for knowledge sharing and helping the projects to prepare the required documents at project levels. Despite of the complex & diversified nature of projects, IRCON initiative for the standardization of quality procedures are the way forward towards attaining the complete integration within the organizational framework.

The Company nominates Quality Officers for major Indian projects to monitor QMS at their respective projects, and the same is also incorporated in General Conditions of Contract (GCC) of the Company for implementation of Quality Management Standards by the Contractor while carrying out the work.

Corporate Quality Council and Project Quality Council meetings are being conducted at Corporate Office and at projects site to review the implementation of Quality Management System (QMS). The Quality objectives are being measured and reviewed both at the Corporate Office and at the Project levels. Internal Quality Audit, as well as Quality Assurance Audit, were conducted in coordination with the project and Corporate Office. Reports of these audits provide not only details of non- conformities encountered during the audit but also the salient features of the project, including progress, positive points if any and areas requiring improvements.

OCCUPATIONAL HEALTH AND SAFETY MANAGEMENT SYSTEM

The Company established an Occupational Health & Safety Management System and was certified for ISO 45001:2004 in October, 2011. The latest surveillance audit for ISO 45001:2018 was conducted in August 2022, whereby the Company has been re-certified for another two years, i.e. up to December, 2024.

During COVID-19 Pandemic, the Company follows the Precautionary measure/ Guideline issued by the Government from time to time. Also taking fast initiative to prevent the spread of COVID-19 in work space by implementing monitoring equipment like thermal scanners, Arogyasetu app, automatic sanitization machine, paper disinfection machines etc. The Company has also initiated a vigilant vaccination drive for their employees and other stakeholders for maintaining the highest standards of Occupational Health and Safety. The Company nominates SHE Officers for major Indian projects to monitor SHE compliance of the statutory laws at their respective projects, and the same is also incorporated in General Conditions of Contract (GCC) of the Company for implementation of SHE Management Standards by the Contractor while carrying out the work. In addition to this, document like Safety and Environmental checklists are also provided at IRCON intranet.

ENVIRONMENTAL MANAGEMENT SYSTEM (EMS)

The Company established an Environment Management System (EMS) and was certified for ISO 14001:2004 in October 2011. The latest re-certification audit for ISO 14001:2015 was conducted in November 2022 whereby the Company has been re-certified for another three years, i.e. up to February 2026. The Company nominates Environment Officers for major Indian projects to monitor EMS and compliance of the environmental laws at their respective projects and the same is also incorporated in General Conditions of Contract (GCC) of the Company for implementation of Environmental Management Standards by the Contractor while carrying out the work. Environmental checklists have been developed and maintained by all projects. Further, environmentally friendly equipment such as solar panels have been installed and are being installed at various offices/projects. Wastewater is recycled at Corporate Office through Sewage Treatment Plant (STP), and the same is used for horticulture work. STPs are also being constructed at IRCONs buildings at Noida and Gurugram.

To conserve electricity and water, LED lights, sensor lights and sensor taps are used in Corporate Offices. Moreover, various environment-friendly steps are taken up across offices/projects of the Company, such as use of fly ash brick instead of clay brick, rainwater harvesting arrangements, sensor-controlled Chromium Plate (CP) fittings, and use of the latest version of facade glass (glass in the building) to make the building sustainable. At construction sites, regular monitoring of water usage and wastewater, ambient air quality and noise quality are being carried out.

Being the environment friendly organization, IRCON actively participates in the national & international events (i.e. world environment day) through competitions & display of banners in order to inculcate the awareness towards the protection of environment among its stakeholders.

IRCON received an award for Outstanding Achievements in Environment Protection in August, 2022 from Greentech Foundation.

HUMAN RESOURCES

IRCON recognizes that its employees are fundamental to its success and are instrumental in upholding the organizations values and culture. The Company is committed to achieving its organizational goals by investing in the development of its human resources, ensuring that they possess the necessary skills and competencies to effectively contribute to the Companys business objectives. IRCONs efforts in human resources development are in line with industry standards, ensuring that its workforce remains equipped with the required knowledge and expertise. The Company places great importance on fostering a positive workplace environment and consistently works towards maintaining it. IRCON strives to create a motivating and satisfying atmosphere where employees are encouraged to make valuable contributions to the companys growth and success.

The Company takes pride in its highly motivated and competent human resource and its contribution. The total employee strength of our company stood at 1341 as on March 31, 2023 which included 933 regular employees, 35 employees on deputation, 302 on contractual, 67 consultants / advisors and 04 on fixed tenure basis. The attrition rate during FY 2022–23 stood at 9.06% in comparison to 6.84% during last year.

EMPLOYEE PRODUCTIVITY

There has been a steady growth in the employee productivity over the past 5 years. The total income of the Company for FY2022–23 is Rs. 0262 Crore. The overall income per employee for FY 2022–23 stood at Rs. .65 Crore as compared to Rs. .62 Crore in FY2021–22.

Recruitment

To maintain its competitive edge, the Company is committed to attracting and onboarding top talent at all levels. This is achieved through various means, including recruiting fresh graduate engineers, professionals, and management trainees. The Company also brings in experienced personnel from the open market, through deputation or absorption from other government departments and railways, as well as by hiring retired staff and utilizing third-party payroll services. The Company follows best recruitment practices to ensure equal opportunities and a harmonious working environment for the advancement of employees from diverse backgrounds, including SC, ST, OBC, minorities, and women. These policies reflect the inclusive and forward-thinking mindset of the management, with a strong emphasis on being an "Equal Opportunity Employer". The Company continuously reviews and refines its recruitment strategies to align them with its broader goals and objectives.

During FY 2022–23, 69 employees were recruited on a full-time basis while 188 were recruited on contractual basis including service contract, as a policy of inclusive employment, 119 of those inducted belong to the SC/ ST/ OBC/EWS category. The Company has also implemented EWS reservation with 14 EWS category employees being inducted. A selection process for tenure-based appointments has also been initiated. In addition to the open market recruitment, campus recruitment was also done from premier institutes like ICAI and ICMAI.

Deputation

To meet its continuous need for trained and experienced manpower, especially in view of project requirements, experienced and trained manpower is inducted from Indian Railways and other Government departments on deputation on a fixed tenure basis. During the year, 9 personnel were inducted on deputation, bringing the total manpower on deputation to 35.

Training and Development

IRCON is moving towards a competency-based framework with the aim of building competency pool of the employees at all levels. As an outcome of competency mapping, individual development plans are prepared for senior and middle-level management. Based on this, training needs are identified and customised training programs are conducted.

Considering the Training and Development as a high focus area, employees are being trained in various domains such as Contract Management, Arbitration, Project Management, Managerial Effectiveness, Negotiations, Business Development and Strategy, Risk Management etc. During the year, 816 man-days of training was imparted, which covered around 437 employees, which included Training Programme on usage of GEM Portal & E-Procurement, Project Quality Council, Gender Equality and Women Empowerment, Management Development Programme, Workshop on RTI Act, Conference on use of Smart Contract in public Procurement & Supply Chain, virtual Training Programmes and many other behavioral, technical, non-technical internal and external training, seminars, workshops were imparted. Strengthening our human capital is, therefore, core to our operations. IRCON runs multiple initiatives to help employees grow in their careers. Progressive policies such as a mentoring and skill development programmes for junior employees, and special leadership development programs for senior employees, have gone toward making the workplace more employee-friendly.

Career Progression

The Companys promotion policy is well-established and proven effective over time. It ensures that deserving employees have ample opportunities for career advancement and facilitates succession planning. Promotions are based on merit, suitability, performance, and professional accomplishments that align with the organizations business requirements. In the Departmental Promotion Committee (DPC) of 2021, a total of 135 promotions were granted in the executive category, while 09 promotions were awarded in the non-executive category.

Performance Management System

The Company has implemented an IT-enabled Performance Management System that is linked with a Performance Related Pay (PRP) system. This PRP system effectively captures various aspects of employee performance, including company performance, team performance, and individual contributions towards achieving the Companys annual objectives. The emphasis on team performance promotes a collaborative and cohesive work environment, where employees are motivated to work together synergistically to achieve team objectives. This approach facilitates the attainment of the Companys long-term goals, such as maintaining minimum wages and other benefits.

Furthermore, the Company has incorporated additional benefits in its policies to support employee well-being. These include provisions for personal healthcare, such as regular medical check-ups and reimbursement of prolonged treatment expenses. The availability of Allopathic, Homeopathic doctors, and alternative therapy options is also provided. Additionally, recreational activities such as gym facilities and the provision of free tea/coffee through vending machines contribute to employee satisfaction and merit recognition.

Use of Information Technology Tools

To maintain business continuity and enable the staff to work from home, the IT Department has taken a leap forward to keeping records in digitized format and implementing e-office for day-to-day operations. HR functions such as Employee Records, Leave Records, Performance Management System (PMS), Annual Property Returns, Employee Engagement, etc. have been put in an e-format, thereby reducing paper use, bringing transparency and efficiency, and improving quality. The policies and programmes are communicated to employees through the Employee Self-Service portal and various social media modes.

Motivation, Awards and Recognition

To recognize the exceptional performance, periodic awards and recognition are given to employees. The meritorious employee delivering the exceptional performance in a financial year is awarded with CMD Award. In addition, various individual and group awards are given to employees for their exceptional performance during the year.

Employee Welfare

During the employment, employees are provided with generous perks, allowances, and facilities, encompassing both monetary and non-monetary benefits. These include transportation assistance, housing options, leased accommodation, subsidized food, and medical facilities. The Companys main objective is to enhance the quality of life for its employees, and as such, it has implemented various schemes to improve their overall welfare. In addition to statutory benefits such as Maternity

& Adoption Leave, First Aid Facility, and payment of scholarship cash awards for education and higher education of employees wards, the Company offers several Employee Assistance Programs. These programs encompass training, advances, a house lease policy to provide better living conditions, and support for employees suffering from prolonged illnesses or terminal diseases. Periodic gifts, such as superannuation gifts, marriage gifts, birthday gifts, diwali gifts, and Annual Day gifts, are granted to foster a sense of belongingness among employees and create a positive work environment. The Company provides liberal superannuation benefits, including Provident Fund, Gratuity, Pension, and Post-Retirement Medical Scheme, which serve as retention tools and offer social security to employees. Funeral expenses are provided in case of unfortunate employee or dependent death, and ex-gratia payments are made to the dependent family members in the event of an employees death or permanent disablement. To provide additional social security, the Company has taken insurance coverage for employees, including personal accident insurance policies, term plans, and savings-linked insurance. This ensures financial protection for unforeseen circumstances.

Furthermore, a 24X7 helpline service has been established to support employees in case of any emergencies. Dedicated mobile numbers are available based on geographical areas to provide immediate assistance when needed.

Women Development

The Company has implemented best practices to ensure equal opportunities and a harmonious working environment for the growth and advancement of women employees. Various programs on gender issues, sexual harassment, and conducive working conditions are conducted to address these concerns. Women employees are provided with opportunities to participate in meetings, project work, and committees, promoting equal opportunity without gender bias. The management has always been at the forefront of adopting practices that create an environment where women feel empowered, confident, and able to make decisions. To ensure a safe and secure working atmosphere for women employees, a committee for the Prevention of Sexual Harassment at the Workplace (POSH) has been established. This committee aims to provide a supportive framework and address any instances of sexual harassment.

Grievance Redressal

To promptly address and resolve employee grievance fairly and equitably grievance redressal system is present in the Company wherein employee can submit their grievance to appropriate authority for redressal. In addition, online grievances can be made to the Ministry of Railways through the Centralized Public Grievance Redress & Monitoring System (CPGRAMS) portal.

Whistle Blower Policy

IRCON has a separate and well-structured Vigilance Department, which deals with frauds or suspected malpractices involving employees, contractors, suppliers, consultants, service providers or those doing business with the Company. Besides, a whistle blower and fraud prevention policy are also in place to monitor unethical activities.

CONTRIBUTION TO GOVT. OF INDIA INITIATIVES

The Company has always been proactively supporting initiatives of the Government of India such as Skill India, Swachh Bharat Mission, Start-up India, Make in India, including MSMEs, Digital India, promotion of Solar Ecosystem by formulating its business or governance objectives in line with the government plans.

PROMOTING MSMEs

Being a CPSE, the Companys procurement policy and practices are guided by the Government policies and practices, including CVC Guidelines. These are based on transparent procurement mechanism, which also promotes procurement from local and small producers and suppliers. IRCON is procuring goods and services as per Public Procurement Policy, 2012 from MSEs. Accordingly, purchase preference is given to those small producers quoting their price within the price

of Rs. .20 per equity share on the face value of Rs. /- each, totaling Rs. 12.86 Crore (60% of the paid-up share capital of Rs. 88.10 Crore). This final dividend is subject to approval from the shareholders at the ensuing AGM and is based on the Companys profits for FY 2022–23.

Considering these dividends, the total dividend for FY 2022–23 would amount to approximately Rs. 82.15 Crore (150% of the paid-up equity share capital of Rs. 88.10 Crore). This represents 36.31% of the post-tax profits for FY 2022–23 and 5.45% of the net worth of the Company as of March 31, 2023. Upon approval and payment of the proposed final dividend, the cumulative dividend paid to shareholders until FY 2022–23 will stand approximately Rs. ,656.62 Crore.

The declaration of dividends aligns with the Dividend Distribution Policy, which complies with Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (LODR Regulations), as amended, and the guidelines on "Capital Restructuring of Central Public Sector Enterprises."

SHARE CAPITAL

As on March 31, 2023, the paid-up equity share capital of the Company stood at Rs. 88.10 Crore comprising of 94,05,15,740 equity shares of face value of Rs. /- each. The shareholding of the Promoter of the Company i.e. the President of India stood at 73.18% of the total paid- up equity share capital of the Company, as on March 31, 2023. IRCON is compliant on the Minimum Public Shareholding (MPS) requirements specified in Rule 19(2) and Rule 19A of the Securities Contracts (Regulation) Rules, 1957.

Based on the market price of Ircon International Limited (IRCON) as on March 31, 2023, it is placed in the top 500 listed companies. As on March 31, 2023, the market capitalization of your Company stood at Rs. 266.89 Crore.

DEMATERIALISATION OF SHARES

All the shares, except only 5407 shares as on March 31, 2023 and 2407 shares as on June 30, 2023 in physical form, are held in dematerialised form and the details of the dematerialisation of shares are provided in the Corporate Governance Report.

TRANSFER TO RETAINED EARNINGS

Appropriations to retained earnings for the financial year ended March 31, 2023 were Rs. 94.85 Crore after considering the total dividend of Rs. 82.15 Crore.

CAPEX AND LIQUIDITY

During the year, the Company on a standalone basis spent a sum of Rs. 48.96 Crore on capital projects across domestic and foreign projects; which includes Rs. 0.56 Crore towards construction of a building; Rs. .52 Crore for acquiring Plant & Machinery; Rs. .49 Crore for acquiring other assets; and Rs. 23.39 Crore towards investments in SPVs.

The Companys liquidity position remains strong at Rs. 785.32 Crore as on March 31, 2023, comprising of Rs. 168.41 Crore in cash and cash equivalent and Rs. 616.91 Crore in other bank balances. Out of Rs. 785.32 Crore, client/ project funds amount to Rs. 942.09 Crore.

The Company has also invested Rs. 23.39 Crore in the equity / quasi-equity of its subsidiaries and joint venture companies during the FY 2022–23, which stood at Rs. 912.4 Crore as on March 31, 2023.

FOREIGN EXCHANGE EARNINGS AND OUTGO

The Company has earned a foreign exchange of Rs. 9080 Crore cumulatively till date. During FY 2022–23, the Company has earned a foreign exchange of Rs. 32.99 Crore as compared to Rs. 21.26 Crore in FY 2021–22. The foreign exchange outgo stood at Rs. 06.83 Crore during FY 2022–23 as compared to Rs. 67.10 Crore during FY 2021–22. Thus, the net foreign exchange earnings amount to Rs. 6.16 Crore in FY 2022- 23.

IRCON GROUP PERFORMANCE

During the year under review, IRCON along with its subsidiaries (‘the Group) on a consolidated basis has recorded highest ever total turnover of Rs. 0750 Crore (previous year: Rs. 586 Crore). The Group has registered a quantum jump of 40.49% in operating turnover to Rs. 0368 Crore (previous year Rs. 380 Crore). The Group reported a consolidated profit before tax of Rs. 91 Crore (previous year Rs. 89 Crore) and profit after tax of Rs. 65 Crore (previous year: Rs. 92 Crore), both registering increase of 29.31% and 29.22%, respectively.

The Group EBITDA was Rs. 117 Crore (previous year: Rs. 46 Crore), an increase of 32.03% over the previous year. During the FY 2022–23, in terms of the financial performance, the Company has achieved and crossed the Turnover targets criteria of Rs. 875 Crore (on Consolidated basis) set up by the Ministry of Railways in terms of the Memorandum of Understanding based on the DPE guidelines.

IMPACT OF COVID-19

The Company is continuously monitoring the material changes to future economic conditions.

The Company has initiated several measures to help its employees and their families, including establishing COVID care centers, vaccination centers, and providing them access to medical care facilities. The Company has also taken various initiatives towards implementation of all precautionary measures to deal with the pandemic.

During the FY 2022–23 the Company had made a contribution of Rs. .53 Crore towards Prime Ministers Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund).

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION

There are no material changes or commitments affecting the financial position of the Company during and after the close of the financial year up to the date of the report.

FINANCIAL STATEMENTS (STANDALONE AND CONSOLIDATED)

The Board of Directors of the Company has, at its meeting held on May 24, 2023, had approved the Financial Statements for FY 2022–23 (Standalone and Consolidated). In accordance with the provisions of Section 129 (3) of the Companies Act, 2013, the Company has prepared its Consolidated Financial Statements a) as per line-by- line method for its wholly-owned subsidiaries viz. Ircon Infrastructure & Services Limited (IrconISL), Ircon PB Tollway Limited (IrconPBTL), Ircon Shivpuri Guna Tollway Limited (IrconSGTL), Ircon Davanagere Haveri Highway Limited (IrconDHHL), Ircon Vadodara Kim Expressway Limited (IrconVKEL), Ircon Gurgaon Rewari Highway Limited (IrconGRHL), Ircon Akloli-Shirsad Expressway Limited (IrconASEL), Ircon Ludhiana Rupnagar Highway Limited (IrconLRHL), Ircon Bhoj Morbe Expressway Limited (IrconBMEL), & Ircon Haridwar Bypass Limited (IrconHBL) and subsidiary company viz. Ircon Renewable Power Limited (IRPL); and b) as per equity method, for seven joint venture companies viz. Ircon-Soma Tollway Private Limited (ISTPL), Indian Railway Stations Development Corporation Limited (IRSDC) [not on a going concern basis], Chhattisgarh East Railway Limited (CERL), Chhattisgarh East-West Railway Limited (CEWRL), Jharkhand Central Railway Limited (JCRL), Mahanadi Coal Railway Limited (MCRL) & Bastar Railway Private Limited (BRPL). The accounts of unincorporated joint ventures have been included in the standalone financial statements for the FY 2022–23.

Pursuant to letter dated October 18, 2021 of Ministry of Railway, the closure of business and transfer / hand over of business /assets of IRSDC is under process. Accordingly, as part of the closure activities, all assets and liabilities of IRSDC [other than its investment in its subsidiary companies viz., Gandhi Nagar Railway and Urban Development Corporation (GARUD) and Surat Integrated Transportation Development Corporation Limited (SITCO)] are to be transferred to Rail Land Development Authority (RLDA)/ MoR on slump sale basis for a consideration not less than the book value as on the cutoff date to be mutually agreed upon as approved in the BoD meeting of IRSDC. Closure related activities initiated in FY 2021–22 are yet to be completed. The liquidation process shall commence on completion of these activities and handing over of assets and liabilities to RLDA/ MoR. Financial statement of IRSDC has been prepared on liquidation basis. The Company does not foresee any impairment in the value of its investment as the Companys share in the reported Net Worth of IRSDC is Rs. 8.50 Crore i.e.26% of Rs. 25 Crore vis-a-vis our shareholding of Rs. 2 Crore.

The Company would make available its audited financial statements (standalone and consolidated) for the FY 2022–23 and financial statements of its eleven subsidiaries (IrconISL, IrconPBTL, IrconSGTL, IrconDHHL, IrconVKEL, IrconGRHL, IrconASEL, IrconLRHL, IrconBMEL, IrconHBL

& IRPL) at its website (www.ircon.org).

Further, a statement containing the salient features of the financial statements of eleven subsidiaries and seven joint venture companies in Form AOC-1 is attached to the Financial Statements.

Considering the COVID-19 pandemic and the challenges associated with dispatching physical copies of financial statements, including the Notice of AGM, Boards Report, Auditors Report, and other related documents, the Ministry of Corporate Affairs (MCA) and Securities and Exchange Board of India (SEBI) have issued guidelines. Accordingly, such statements & documents can be sent exclusively via e-mail to members who have registered their email addresses with the company or with the depository participant/depository, as well as to other eligible persons. These relaxations have been extended until September 30, 2023, as per circulars dated December 28, 2022 and January 5, 2023 issued by MCA and SEBI respectively .

Taking into account these relaxations and as part of our commitment to environmental sustainability, the Notice of AGM and Annual Report will be electronically delivered to shareholders who have already registered their email addresses with the respective depository participants. These documents will be accessible on the Companys website and will also be provided to the stock exchanges, namely BSE Limited (BSE) and National Stock Exchange of India Limited (NSE).

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis (MDA) Report, as mandated by Regulation 34 read with Schedule-V to the LODR Regulations and DPE Guidelines, has been included as an annexure to this report. It is hereby incorporated by reference and serves as an integral component of this report. The MDA Report provides a comprehensive review of various aspects including the global and Indian economy, industry analysis, future outlook, Company overview, legal status and autonomy, business divisions/ units, financial and operational performance, projects executed during FY 2022–23, upcoming projects, strengths, scope and opportunities, key concerns, business strategies, risk management, adequacy of internal control systems, and significant developments in human resources.

EXTERNAL ENVIORNMENT MACROECONOMIC CONDITIONS

International Monetary Fund (IMF) in its World Economic Outlook (April 2023), predicted global growth of 2.8% in 2023, with a slight improvement to 3.0% in 2024. Despite of global headwinds, Indias economy is expected to grow at a faster pace than the global average and it is expected to grow at 5.9% in 2023 and 6.3% in 2024. The slowdown is concentrated in advanced economies, especially the euro area and the United Kingdom.

Global headline inflation is set to fall from 8.7% in 2022 to 7.0% in 2023 on the back of lower commodity prices, but underlying (core) inflation is likely to decline more slowly. Inflations return to target is unlikely before 2025 in most cases. Once inflation rates are back to targets, deeper structural drivers will likely reduce interest rates toward their pre-pandemic levels. Indias GDP growth for FY 2023–24 anticipated by the RBI is 6.5% in its monetary policy (April 2023). However the key concern on the growth front in the immediate future is the drag caused by the weak external demand conditions and the impact of any adverse weather conditions on Indian agriculture provides additional downside risk to the growth trajectory.

INFRASTRUCTURE & CONSTRUCTION INDUSTRY – GOVERNMENT INITIATIVES & INDUSTRY OUTLOOK

Infrastructure plays a huge role in propelling other industries and Indias overall development. The government, therefore, focuses on the development of infrastructure and construction services through focused policies such as open FDI norms, large budget allocation to the infrastructure sector, smart cities mission, etc. PM launches Gati Shakti Master Plan to integrate different modes of transportation and increase the speed of infrastructure development in India.

The construction Industry in India is expected to reach $1.4 Tn by 2025. Under National Infrastructure Pipeline (NIP), India has an investment budget of $1.4 Tn on infrastructure 24% on renewable energy, 18% on roads & highways, 17% on urban infrastructure, and 12% on railways. Government thrust for developing 35 Multimodal Logistics Parks (MMLPs) at a total capital cost of $ 6.1 Bn, will cater to 50% of the freight movement and further boost infrastructure development in the country. Indian Railways have prepared a National Rail Plan (NRP) for India – 2030 to create a ‘future ready Railway system by 2030. The NRP is aimed to formulate strategies based on both operational capacities and commercial policy initiatives to increase modal share of the Railways in freight to 45%. The objective of the Plan is to create capacity ahead of demand, which in turn would also cater to future growth in demand right up to 2050 and also increase the modal share of Railways to 45% in freight traffic and to continue to sustain it.

The government announced 5,000 km of Metro rail network by 2047 in 100 cities. One Station One Product scheme aims to provide opportunities for enhanced livelihood through skill development through provision of sale outlets at railway stations across India. Station redevelopment project will boost the passenger experience, generate new employment opportunities and have a multiplier effect on Indias economy. Taking cognizance of its significance in overall infrastructural development, the NIP envisages the investment in Indian Railways worth Rs. 1.43 lakh crore (US$ 138 billion) till FY 2024–25.

With the objective to bring down logistics costs below the national average by 2028 to make exports globally competitive, the Government has made a plan of Rs. 00 lakh crore investment in infrastructure with some mega projects such as the doubling of railway lines, their widening, dedicated freight corridors from Mumbai to Delhi and Amritsar to Kolkata besides 11 other industrial corridors.

Vision 2024 has been envisaged to achieve targets of 2024 MT freight loading by 2024. Government is working towards the development of a national highway network of 2 lakh kilometers by 2025. Indian Railways has planned to install 1000 MW of solar power plants and about 200 MW of wind plants by 2022–23. Out of this, about 204.82 MW (101.42 MW solar and 103.4MW wind power) renewable power has already been set up.

In Budget 2023–24, capital investment outlay for infrastructure is being increased by 33% to Rs. 0 lakh crore (US$ 122 billion), which would be 3.3% of GDP. A network of 35 Multimodal Logistics Parks is planned to be developed as part of Bharatmala Pariyojana, with a total investment of about Rs. 6,000 crore (US$ 5.5 billion), which once operational, shall be able to handle around 700 million metric tonnes of cargo. Of this, MMLPs at 15 prioritized locations will be developed with a total investment of about Rs. 2,000 crore (US$ 2.6 billion). A capital outlay of Rs. .40 lakh crore (US$ 29 billion) has been provided for the Railways, which is the highest ever outlay and about 9 times the outlay made in 2013- 14. 100 critical transport infrastructure projects, for last and first mile connectivity for ports, coal, steel, fertilizer, and food grains sectors have been identified and will be taken up on priority with investment of Rs. 5,000 crore (US$ 9 billion), including Rs. 5,000 crore (US$ 1.8 billion) from private sources. 50 additional airports, heliports, water aerodromes and advance landing grounds will be revived for improving regional air connectivity.

A total length of 24,800 kms in road projects have been proposed to be constructed with an estimated outlay of Rs. .35 trillion (US$ 74.15 billion) under Bharatmala Pariyojana Phase-I. NHAI will consider only those projects that require minimal land acquisition worth Rs. trillion (US$ 42.92 billion) under Bharatmala Pariyojana scheme. A total of 65,000 kms of roads and highways are to be constructed under Bharatmala Pariyojana. In 2023–24, NHAI is allocated Rs. .62 lakh crore (US$ 20 billion), all of which is budgetary support.

In Budget 2023–24, the Government of India has allocated Rs. .7 lakh Crore (US$ 33 billion) to the Ministry of Road Transport and Highways. The Roads sector is expected to account for 18% capital expenditure over FY 2019–25. The government also aims to construct 23 new national highways by 2025.

These budget allocations are aimed at improving existing infrastructure, building new projects, and addressing the infrastructure gaps across the country.

ORDER BOOK

In the industry that the Company pertains to, an order book is considered an indicator of future performance since it represents a portion of anticipated future revenue. The Company caters to both domestic as well as international markets and receives orders both on competitive bidding as well as through nomination by the Ministry of Railways. Ministry of Railways have made a significant change in their policy on allotting the projects to PSUs, and have ended the system of competitive bidding amongst the eligible PSUs, and introduced competitive bidding for execution of railway works.

The order book as on March 31, 2023, is Rs. 5195 Crore as compared to Rs. 3758 Crore as on March 31, 2022. The major new orders are from railway electrification, highway project, metro track works, workshops, airports and renewable energy; also civil and track work in prestigious High Speed Railway Project. The order book as on June 30, 2023 stood at _ 32,486 Crore.

DOMESTIC PROJECTS

Since incorporation, the Company has diversified into various infrastructure sectors and is now an established player in the field of railway and highway construction. Moreover, it has diversified in many other areas such as power transmission lines, sub-stations industrial complex, bridge and flyovers, tunnels, electrical and mechanical work, signaling and telecom, production units, station building, multi-function complex, and construction of commercial, residential complexes, and airports. The diversification of project portfolio across various sectors has helped the company in de-risking its construction business and reduce our dependence on any sector or type of project. In the coming future, IRCON shall continue to pursue projects of High-Speed Rail, National Capital Region Transport Corporation (NCRTC), National Highways Authority of India (NHAI), Indian Railways and other important and high value projects in India.

During the FY 2022–23, your Company was awarded the projects in India viz., establishment of Railway Sidings along with Railway Station contagious to Mine Lease Boundary of Gere Pelma Sector-III Coal Mine, PMC services for Signaling & Telecommunication system; and development of Rail Infrastructure for proposed 02 nos. RLS (20 MTY) for Ananta OCP of Jagannath Area, at Talcher. IRCON has also been engaged for Central Public Sector Undertaking (CPSUs) for development of New Industrial Estates in Union Territory of Jammu and Kashmir. During FY 2022–23 the following two projects have included in the completed projects category. With this, IRCON has completed more than 400 completed domestic projects.

a Construction of Eight lane Vadodara Kim Expressway from Km. 323.000 to 355.000 (Sanpa to Padra Section of Vadodara Mumbai Expressway) in the State of Gujarat under NHDP Phase – VI on Hybrid Annuity Mode (Phase IA-Package II).

a ECR – Doubling between Hazipur – Bachwara with electrification project (72km) including planning, design and construction of all service and residential buildings, circulating area, parking, platforms, subways, shelters and other allied structures of all stations, including Electrical, Signal & Telecommunication works and any other works.

ONGOING PROJECTS:

A list of ongoing major projects in India is given at

Appendix-A.

In FY 22–23, the focus of your Company has been execution, faster deliveries and meeting stringent timelines for overall optimal contribution to the much needed infrastructure growth._ This is in line with the vision of our Honble Prime Minister and Honble Minister of Railways. During the FY 2022–23 following were some of the achievements of on-going major projects in India:

1. Udhampur Srinagar Baramulla Rail Link Project (USBRL) in J&K (cost plus contract awarded by Northern Railways having revised estimated cost of Rs. 3557.47 Crore): Milestone of 23.4 Km of tunnel lining has been completed in the FY 2022–23 and a total of 94.162 km length [Comprising Main Tunnel (MT) + Escape Tunnel (ET) & Cross Passage (CP)] has been completed in the section between Katra to Banihal. Further, breakthrough of 13.18 Km of MT and 32.34 Km of ET were also achieved. Project has also achieved its highest ever expenditure booking of about Rs. 899.40 Crores. The execution of project is in advanced stage and is targeted for commissioning in FY 2023–24.

2. Sivok Rangpo New BG Rail Line Project (cost plus contract awarded by Northeast Frontier Railways having revised estimated cost of Rs. 248 Crore): Total Tunnel Mining and Lining completed in the FY 22-23 is 11.60Km & 2.28Km respectively. Mining in six tunnels have been completed. Milestone of second breakthrough of Tunnel T-5 achieved on 18.06.2022, third breakthrough of Tunnel T-9 on 19.10.2022, fourth breakthrough of Tunnel T-2 (896 m.) on 23.11.2022, Fifth breakthrough of Tunnel T-12 (1404 m.) on 24.12.2022, sixth breakthrough of Tunnel T-11 (3232 m.) on 23.01.2023 and longest Adit tunnel of this project i.e. Adit-1 (1144m) of Tunnel T-10 on 19^th Feb, 2023._Work is in progress in all the 14 tunnels, 13 major bridges and 4 yards. Overall progress of project is 50%. The project is of strategic importance with future connectivity to Gangtok and thereafter to Indo-China border (Nathula pass) and has a vital role in meeting the defense requirements.

3. Dedicated Freight Corridor Project (Vaitarana

- Sachin Section of Western Dedicated Freight Corridor Phase-2), Civil, Building and Track Works, Package -CTP-12: EPC Contract awarded by Dedicated Freight Corridor Corporation of India Limited (DFCCIL): Revised estimated cost of work shall be Rs. 353 Cr._ Works completed and trial run done in Sachin – Gholvad section, 110 Route km out of 186 Rkm. Balance works in Gholvad – Vaitarana section are progressing well.

4. Rampur Dumra-Tal-Rajendrapul (cost plus project awarded by East Central Railway having revised estimated cost of Rs. 701 Crore) : The Project comprises_ Design & construction of Main Bridge having total length of 1874m with 17 spans, Rail Viaduct of 3.2km, 2 nos._ROBs, 3 nos. RORs, one RUB, Embankment of around 11.3 km, 8 nos. Minor bridges and track linking works including electrification. Casting of 15 and sinking of 11 out of 18 wells, one abutment and seven pier cap have been cast. Erection of 6 nos. open web girder also launched. Formation work on north side along with flood protection works have been completed and on south side of river 25.98 lac cubic meter against the scope of 28.36 lac cubic meter earth work is completed. Seven out of eight minor bridge, one RUB and substructure for two ROBs also completed. Piling works on the all 3 RORs completed and pile cap casting is in progress (50% works completed). All the structural steel for important bridge, ROBs and RORs procured. Work on 3.6 Km long via duct is also progressing well and till date 927 nos. of piles out of 1000 nos., 61 pier caps and 12 pier shaft out of 101 nos. piers have been completed. The balance work is progressing well.

5. Katni-Singrauli Doubling Project (cost plus project awarded by Western Central Railways having revised estimated cost of Rs. 445 Crore) : Total 78.29 Km sections was commissioned during FY 2022–23. During FY 2023–24, total 49.21 Km has been targeted. CRS (Commissioner of Railway Safety inspection) has inspected 19.13 Km section of Mahroi – Vijaysota on 27.06.2023. Another section of 30.11 Km is planned in December 2023 and 7.51 Km during FY 2024–25, total 180.5 Km out of 257 Km has been commissioned so far.

6. Katni-Singrauli Doubling Project (Railway Electrification Work): Railway electrification work commissioned in Katni-Singrauli Doubling project during FY 2022–23 is 78 RKM. Total 180.5 Km electrification completed with doubling.

7. Kiul-Gaya Doubling Project (cost plus project awarded by East Central Railways having revised estimated cost of Rs. 200 Crore) : CRS inspection (Commissioner of Railway Safety inspection) of Wazirganj-Tilaiya section (18.01 Km) was conducted on 02.09.2022 and the section was commissioned at a permissible speed of 100 kmph; and, the entire Lakhisarai -Sheikhpura section (25.32 Km) was commissioned with 100 kmph on 21.02.2023. Total 61.48 Km has been commissioned so far. Rest 61.64 Km has been planned during FY 2023–24. During FY 2023–24, 1.405 Km of Kashichak yard commissioned on 31.05.2023.

8. Sports Complex at Gholsapur, Behala Stadium, Eastern Railway Kolkata (the revised estimate of Rs. 0.82 Cr.): An international standard fully air-conditioned multi-purpose Indoor Stadium with state-of-the-art facilities at Behala was inaugurated on May 30, 2022.

9. NCRTC Project (Revised Estimated Cost of Rs. 23 Crore): IRCON has secured the prestigious ADB (Asian Development Bank) funded OHE & Power Supply Work of Delhi-Ghaziabad-Meerut RRTS Corridor of NCRTC through International Competitive Bidding. It marks a significant milestone as the first-ever semi-high-speed Rapid Rail Project in India to achieve the design speed of 180kmph and operation speed of 160kmph.

Major achievements are as follows:

a Introducing Spring type ATD of 3000 kgf tension, Glass Fibre Tension Insulator at insulated overlap, Retractable Catenary System, which have been used for the first time in India for design speed of 180 kmph;

a Commissioning of 220 kV, 33 kV & 25 kV Gas Insulated Sub-stations (GIS), which are compact in size, low in maintenance and reduce the requirement of space;

a Commissioning of overhead equipment (OHE) of priority section of the project from Sahibabad to Duhai including Duhai Depot, covering a distance of 17 RKM, in record time;

a Delivering results by initiating the trial run on 5th January ‘23;

a Commissioning of 2 nos. of 220kV Receiving Sub Stations (Ghaziabad RSS & Murad Nagar RSS), associated 220 kV EHV Cabling from GSS to RSS and 5 nos. of 33 kV Auxiliary Sub Stations (ASS);

a Civil works at the RSS locations have been executed in compliance to achieve highest rating of IGBC;

a Achieved ISO 45001:2018 (Occupational Health & Safety Management System) and ISO 14001:2015 (Environmental Management System) certification for NCRTC Project;

INTERNATIONAL PROJECTS

In FY 2022–23, the contribution of international projects to the total revenue amounted to Rs. 11.84 Crore, which accounted for 4.15% of the operating turnover. This is in comparison to Rs. 80.43 Crore in FY 2021–22, representing 6.95% of the operating turnover. Regarding PBIT, the contribution from foreign projects reached Rs. 00.41 Crore, indicating an increase of 96.67% compared to Rs. 1.03 Crore in the previous year. The Company continues to actively participate in new projects in foreign countries, and has one ongoing project each in Bangladesh, Algeria, Sri Lanka, Nepal and Myanmar. By continuing to diversify its business and geographical focus, the Company strives to secure a broader range of projects to maximize business volume and profit margins. Efforts are being made to secure foreign projects through Line of Credit/ other project export funding arrangements of EXIM Bank of India and projects funded through Multilateral funding agencies.

During the year 2022–23, your Company has secured the order of Procurement of Design, Installation, Testing, Commissioning and Certifying of Signaling and Telecommunication System from Maho Junction (Including) to Anuradhapura (Excluding) in Sri Lanka under Indian Line of Credit.

ONGOING PROJECTS

The Company is executing the following projects in foreign countries: i. Bangladesh (a) Khulna-Mongla Port Rail Line project

The Company secured a project in Bangladesh for construction of Khulna-Mongla Port Rail Line for Bangladesh Railway, at US$ 147.78 million (equivalent to approx. Rs. 11 Crore) and after approval of VO-2 at cost of US$ 185.73 million. The project includes construction of embankment, tracks, all civil works, major and minor bridges (except Rupsha Bridge), culverts and implementation of EMP against Package WD1. Additional scope of work was added in 2021. The completion tenure is extended upto September 2023, along with the additional scope of work including rehabilitation of 5 major bridges and 16 nos. of culverts and pending approval for variation VO-3.

(b) Agartala (India)-Akhaura project (Bangladesh portion)

The Company has also signed a contract for providing Technical Advisory Services (TAS) for Construction of New Railway Line from Agartala (India) -Akhaura (Bangladesh) and Project Management Consultancy (PMC) for Construction in Bangladesh Portion with Ministry of External Affairs (MEA), Government of India. The construction contractor for the project is appointed by Bangladesh Railways and contract value is BDT 240.9 Crore (equivalent to approx. Rs. 09.47 Crore). The completion period of the construction contractor was extended up to June 30 2023, however the trial run of loco is planned by 22.08.2023. The overall progress of the project is approximately 88.24 %. ii. Algeria

The project was awarded by ANESRIF, the National Agency for the Planning and Implementation of Railway Investments, Ministry of Transport, Government of Algeria, at a value of Algerian Dinar 1,628 Crore (equivalent to approx. Rs. ,003 Crore) with completion date on November 2012. The project involves the construction of the second line and upgradation of an existing line, with a diversion of 10 km from Oued sly to Yellel in Algiers-Oran section of Algerian Railways. The value of the contract, including additional works for the construction of the double line, has been revised to Algerian Dinar 3,268 Crore (equivalent to approx. Rs. ,342 Crore).

The project is likely to be completed in December 2023, as per the revised scope of work.

The work of 82 km new track line has been made operational in spite of the cash flow problems of ANESRIF which is hampering progress, particularly the structural works awarded to sub-contractors. Work on the existing line has also started and a total_ stretch of 71.5 km out of 74 km of the existing line, 6 out of 7 station buildings are ready to be handed over, and 8 major bridges have also been completed with the assurance of timely payments. The client has assured uninterrupted payments, which will improve the progress of work and is expected to get completed by December 2023. iii. Sri Lanka (a) Upgradation of Railway Line from Maho_ Omanthai under Indian Line of Credit – Track Rehabilitation and ancillary works._

In Sri Lanka, the Company secured a project for

Upgradation of Railway Line from Maho_ Omanthai under Indian Line of Credit – Track Rehabilitation and ancillary works. The project is awarded by Sri Lankan Railways under the Ministry of Transport and Civil Aviation, Government of Sri Lanka at a value of US$ 91.27 Million (equivalent to approx. Rs. 37.22 Crore) through competitive bidding.

Scope of work is_ rehabilitation of existing single line Broad Gauge track from Maho-Omanthai of around 128 km length in Two Phases under Traffic Block of 5 Months and 6 Months. The project was awarded on 29th April 2019 with completion period of 36 months (starting from date of receipt of advance payment, 29^th Nov,2019). The project is financed through EXIM Bank of India as per Indian line of credit. The date of completion of the project as per the contract is November 28, 2022. The project is delayed due to CoVid-19 pandemic restrictions and subsequent economic and fuel crisis in Sri Lanka.

The first phase of the Mega Traffic Block from Anuradhapura and Vavuniya (48.5KM) has been commissioned in July, 2023. Further, granting 2^nd Phase Traffic Block for rehabilitation of the remaining section from Maho to Anuradhapura (65 KM) is under discussion and not yet concluded. Likely date of completion of the Project will be June 30, 2024.

The overall progress of the project is approx. 62%.

(b) Procurement of design, installation. Testing, commissioning, and certifying of Signaling and Telecommunication system from Maho Junction (Including) to Anuradhapura (Excluding) under Indian Line of Credit:

Your Company also secured a project for "Procurement of design, installation, Testing, commissioning, and certifying of Signaling and Telecommunication system from Maho Junction (Including) to Anuradhapura (Excluding) under Indian Line of Credit"._ The project was awarded on December 04, 2022 by Sri Lankan Railways under the Ministry of Transport and Civil Aviation, Government of Sri Lanka at a value of US$ 14.90 Million (equivalent to approx. Rs. 21.25 Crore) through competitive bidding. Completion period is 12 Months from the date of receipt of mobilization advance._ The project is financed through EXIM Bank of India under Indian line of credit. Contract Agreement is not yet signed due to prevailing economic conditions in Sri Lanka. As such, the project is yet to start. iv. Nepal

In Nepal, the Company is executing the following two projects:

(a) Construction of BG line between Jogbani (India)- Biratnagar (Nepal) on Indo-Nepal border

The project involves construction of new BG rail line from Bathnaha (India), Ch. 0.00 Km to Biratnagr (Nepal), Ch. Km 18.60. The proposed alignment in Indian portion (5.45 Km) falls in Araria district of Bihar State under Katihar Division of North East Frontier Railways and on the Nepal side (13.15 Km), in Morang district.

The revised value of contract of Rs. 01.65 Crore is under approval of the Ministry of External Affairs. The section from Bathnaha (India) Ch. 0.00 Km to Nepal Custom Yard (Nepal) Ch. 6.70 Km has been completed and ready for commissioning. The work is in progress in the remaining portion. Progress is hampering due to obstructions being created by local land owners.

The overall progress of the project is approximately 86%.

(b) Construction of BG Line by Gauge conversion Jayanagar (India) – Bijalpura (Nepal) with extension upto Bardibas on India Nepal Border

The Project involves construction of a new BG rail line from Jaynagar (India), Ch. 0.00 Km to Bijalpura (Nepal) Km.52.336 with extension up to Bardibas,

Ch. Km 68.72. The proposed alignment in the Indian portion (2.975 Km) falls in Madhubani district of Bihar State and on the Nepal side (65.745 Km) in Mahottari district.

The revised estimate of Rs. 83.83 Crore is under approval of the Ministry of External Affairs.

Your Company on behalf of the Government of India has handed over the newly commissioned cross border rail section (Section-1) from Jayanagar (Km. 0.00) to Kurtha (Km. 34.90) to Government of Nepal on October 22, 2021 which was inaugurated through virtual mode by the Honble Prime Minister of India and the Honble Prime Minister of Nepal on April 02, 2022. The first phase of 34.9 Km Jaynagar (India) – Kurtha (Nepal) section is part of 68.72 Km Jaynagar-Bijalpura-Bardibas rail link being built under Government of India grant assistance of NPR 8.77 billion. Section-2 from Km 34.900 to km 52.34, Kurtha- Bijalpura has also been completed. In Section-3 from Km 52.34 to Km 68.72, Bijalpura-Bardibas land has not yet been acquired by the Government of Nepal. The overall progress of the project is approximately 73%. v. Myanmar

During FY 2022–23, the Company has secured a project in Myanmar, for Balance work of Construction of Road from Paletwa (Myanmar) to Zorinpui (Mizoram) (Kaladan Road Project) under Kaladan Multi-Modal Transit Transport Project (KMMTT Project), from the Ministry of External Affairs, on EPC mode at a lump sum cost of Rs. 780 Crore. With this project, it is intended to open up an alternate route to North-East Region and connect Mizoram with Chin State of Myanmar at Zorinpui. The agreement for the execution of this project has been signed on March 07, 2022 and the project is to be completed within 40 months from the date of the signing of the agreement.

At present, in 50 Km stretch, work has commenced in 40 Km from Paletwa end (Myanmar) & 10 Km from Zorinpui end (India-Myanmar Border). Work in the remaining 50.90 Km stretch is expected to start after Oct2023 once the monsoon season is over.

REAL ESTATE SECTOR

IRCON has identified Real Estate Sector as one of the sectors for diversification, keeping in view the tremendous potential in this Sector. Your Company had acquired 8 plots in different sectors, on leasehold basis for 90 years, at NOIDA and has successfully Leased out 22,023 Sq. mt. of built – up space for Commercial and Office use. The Company has also developed property in Sector 32, Gurugram, Haryana and this property is registered with the trademark authorities in India as ‘IRCON INTERNATIONAL TOWER. About 2079Sq. mt. carpet Area of this property has been Leased Out to government agencies and balance available space is in the process of leasing out.

IRCON Retail Mall at Sector – 43, NOIDA, Uttar Pradesh and Commercial cum Office Building at Sector -48, NOIDA, Uttar Pradesh has been leased out completely. The Company had entered into a Memorandum of Understanding (MOU) on March 26, 2018, with the Rail Land Development Authority (RLDA) for transfer of leasehold rights to IRCON for commercial development on the land parcel measuring 4.3 (four points three) Hectare at Bandra East, Mumbai, Maharashtra, for 99 years against the payment of Upfront Lease Premium. Since MoU has expired and the work being unable to commence on account of non-finalization of agreement between Mumbai Metropolitan Region Development Authority (MMRDA) and RLDA / MoR, the land has been returned back to RLDA and consultancy contracts for commercial development of the plot have also been novated to RLDA.

COMPANIES, JOINT VENTURE COMPANIES AND ASSOCIATE COMPANIES

A brief background on the eleven subsidiary companies and seven joint ventures companies of IRCON along with their financials and performance is given at Appendix-B. In terms of the Companys Policy on the determining the "Material Subsidiary" and Regulation 24A of the LODR Regulations, for the financial year ending March 31, 2023, none of the subsidiary company is a ‘material subsidiary i.e. whose total income or net worth exceeds 10% of consolidated income or net worth of IRCON in the immediately preceding financial year i.e. March 31, 2022.

COMPLIANCES OF PRESIDENTIAL DIRECTIVES

Presidential directives as issued from time to time on various matters like reservation policy for reserved category persons, SC/ST roster in the employment, revision in pay scale 2017 etc. have been complied with.

OFFICIAL LANGUAGE

The Company is undertaking various novel and encouraging initiatives for extensive use of Hindi in the office. Some of them are: a. Pledge by all employees to work in Hindi completely on last Monday of every month. b. Rajbhasha Sanghosthi is being conducted on a quarterly basis in Corporate Office. c. Birthday wishes to employees, a thought and a word, contributed by different departments on rotational basis, a poem by renowned poets etc. are being displayed in Hindi at the reception. d. Thought of the day and a word in Hindi is displayed at reception, which is contributed by departments daily on rotation basis.

Every third month a meeting is conducted by Hindi Department with any one department in the Corporate Office in order to resolve issues faced in working in Hindi. In addition, regular quarterly meetings of Official Language Implementation Committee and quarterly workshops for effective use of the UNICODE system and official language are being conducted. Employees are being encouraged through various incentive schemes for the implementation of the Annual Programme of the Official Language Department. The bilingual facility has been introduced for computer systems and mobile phones used by officials of the Company. Bilingual formats have been made available at IRCONs internal website for use by the employees.

COMPLIANCE OF RIGHT TO INFORMATION ACT, 2005

In accordance with the provisions of the Right to Information Act, 2005, IRCON has ensured the availability of updated information, including the names of the Appellate Authority, Central Public Information Officer, Assistant Public Information Officer, and State Level Public Information Officers on our website. We have promptly responded to the queries received within the specified time frame. These queries primarily pertained to service matters, recruitments, finance, contracts, corporate social responsibility (CSR), and projects. The details of RTI cases have been regularly published on the website of the Central Information Commission (CIC) on a quarterly and annual basis. Additionally, a copy of the same is forwarded to the Ministry of Railways for information.

During the year 2022–23, 204 applications and 38 first appeals were received and at the beginning of the year 01 application was under process for disposal within the allowable time limit (i.e., total 205 applications and 38 appeals during the year). Out of which, 193 applications (including opening balance of 1 application) and 38 First Appeals were disposed of. As on March 31, 2023 12 applications and 02 appeals were under process for disposal within the allowable time limit.

COMPLIANCE OF IMPLEMENTATION OF PUBLIC PROCUREMENT POLICIES FOR MSEs AND PREFERENCE TO MAKE IN INDIA.

The Company has in place a comprehensive Purchase Preference Policy since June 2012 which is in line with the Public Procurement Policy for Micro and Small Enterprises

(MSEs) Order, 2012 notified by the Ministry of Micro, Small and Medium Enterprises (Ministry of MSME) under section 11 of Micro, Small and Medium Enterprises Development Act, 2006. IRCON uses Central Public Procurement portal (CPPP) and Government e-Marketplace (GeM) portal for its procurement, which provides facilitation of registration of MSEs firms registered with any statutory bodies specified by Ministry of MSME.

The Company has always encouraged local suppliers to participate in its tendering process and also promote them through training and hand holding programs. Our continued pursuit in this direction has seen improved participation of small local players and socio-economic development of communities in and around operational locations. IRCONhastakenseveralstepsforeffectiveimplementation of MSE policy. The benefits of waiver of cost of tender documents and deposit of earnest money and purchase preference prescribed under the Policy, are incorporated in the tenders for procurement of goods and services. The company has been extensively following the guidelines of Government on procurement through GeM and provisions are also made in tenders to promote "Make in India" directives of the Government of India. Tenders valuing upto Rs. 00 Crore were invited during FY 2022-23 using national competitive bidding in compliance to Public Procurement (Preference to make in India), Order 2017.

During the FY 2022–23, the Company has procured items valuingRs. 4.52CrorefromMSEvendorsagainstexpenditure valuing Rs. 02.39 Crore (excluding the procurement of items which are beyond the scope of MSEs) towards material, stores & service, thereby achieving 43.48% procurement from MSEs in compliance with the Procurement Policy. The Company has conducted one national level Special Vendor Development Program at the Corporate Office, Delhi on December 16, 2022.

In compliance with the Micro, Small and Medium Enterprise Development Act, 2006, the Company has onboarded on the Trade Receivables Discounting System (TReDS) platform, w.e.f. January 25, 2018, to facilitate the financing of trade receivables of MSEs by discounting of their receivables and realisation of their payment before the due date. A clause in General Conditions of Contract is incorporated for MSEs vendors willing to avail the facility.

HUMAN RESOURCE DEVELOPMENT

IRCON recognizes that its employees are fundamental to its success and play a crucial role in safeguarding the organizations values and culture. The organization firmly believes that its achievements rely on the alignment and performance of its workforce, as well as maintaining a positive work environment. It is committed to establishing a collaborative, inclusive, and performance-driven atmosphere that fosters learning, growth, and overall employee well-being.

IRCONs Human Resource (HR) Philosophy revolves around empowering and nurturing employees, allowing them to reach their full potential, encouraging innovative ideas, and providing rewards based on performance. The companys work culture is characterized by openness and dynamism, empowering employees to take initiative in their roles with full support from top management. At IRCON, the Human Resource Management (HRM) team is dedicated to recruiting, retaining, and developing the right people. They continuously strive to create an optimal work environment that is inclusive, open, diverse, and provides equal opportunities for all employees. The company has aligned its HR strategy, systems, and procedures with its business objectives, focusing on building competencies necessary for organizational success. This strategy serves as a motivating force for employees, bridging the gap between the companys future needs and individual aspirations.

IRCON maintains a performance-oriented culture where the contributions of every employee are measured and appropriately recognized. The Company has implemented a robust Performance Management System (PMS) that aligns with its philosophy of rewarding and acknowledging merit at all levels. This system supports the professional development of executives through a structured approach integrated into the companys performance appraisal process. IRCON takes pride in its highly motivated and competent human resources and acknowledges their significant contributions.

MANPOWER STRENGTH

The total manpower strength of IRCON as on March 31, 2023, stood at 1341, (previous year 1278) which included 933 regular employees, 35 employees on deputation, 369 on contract (including service contract) and 04 on fixed tenure basis. Out of the total 1341 employees of the Company, 1284 are posted on Indian projects and 57 on international projects. Among 1341 employees, 900 are technically and professionally qualified. There was a total of 65 women employees as on March 31, 2023. The overall income per employee for FY 2022–23 stood at Rs. .65 Crore as compare to Rs. .62 Crore in FY 2021–22. During the year, the total newly employed personnel stood at 266 which included 69 regular employees, 9 employees on deputation, and 188 on contract (including service contract).

RESERVATION IN EMPLOYMENT

The Company continues to give utmost importance to the implementation of the policies and directives of the Government of India in matters relating to reservations in the employment of candidates belonging to Scheduled Caste (SC) / Scheduled Tribe (ST) / other backward classes (OBC) and differently-abled categories. There was a total of 521 SC / ST / OBC and differently-abled employees as on March 31, 2023.

Further, during the FY 2022–23, out of the 66 employees inducted against regular posts, 29 belong to SC / ST / OBC and differently-abled categories. Similarly, out of the 164 employees recruited against the contractual positions, 84 belong to SC / ST / OBC and differently- abled categories.

During the FY 2022–23, training has been given to 437 employees, out of which 171 belong to SC/ST/OBC and differently-abled categories. To ensure the welfare of these employee categories, the Company has appointed Liasion Officers.

The infrastructure of the Company is well built catering to the needs of differently-abled employees.

TRAINING AND HUMAN RESOURCE DEVELOPMENT

IRCON puts a lot of emphasis on development and career progression of employees. Training programs are organised throughout the year. During the FY 2022–23, in- house training programmes across all levels of employees were organised. Professional programmes, workshops, and seminars organised by reputed and prestigious institutes / agencies were carefully identified in line with business needs of IRCON, and suitable officers were nominated for such programmes.

The Company has been continuously taking steps for building capacity of its human resource through training in functional and general management areas, contract and arbitration, leadership, information technology, as well as soft skills. External faculty is arranged wherever required, and officials are nominated for carrying out workshops and seminars with reputed institutes. Employee Development has always been a priority for the Company, and various training and development plans have been initiated from time to time. During the FY 2022–23 a total 816 man- days training was imparted to officials of IRCON through workshops, seminars, conferences, in-house training and training in external institutes.

EMPLOYEE WELFARE

The Company has adequate and robust schemes in place for the welfare of the employees. These are health cover, medical scheme, post-retirement medical scheme, post- retirement pension scheme, periodic health check-ups at regular intervals, allowances, self-lease for residential accommodation, educational scholarships to the wards of employees, a one-time educational grant for admission to professional degrees and diploma courses, educational awards to meritorious children of employees, educational assistance to the wards of deceased employees, assistance for marriage of daughters and dependent sisters of employees in non-executive categories, and resort facilities for employees and their family members on concessional rates through Dalmia and Sterling Resorts.

DISCLOSURE AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company is dedicated to creating a supportive and secure working environment for its women employees. The Company has implemented a comprehensive policy for the Prevention, Prohibition, and Redressal of Sexual Harassment at the Workplace, which applies to all employees, including regular employees, deputationists, temporary workers, ad-hoc employees, contract workers, daily wage workers, and individuals employed through agencies or contractors. This policy, along with its details, can be accessed on the Companys website. Furthermore, this policy extends to wholly-owned subsidiary companies of IRCON that are formed as Special Purpose Vehicles.

Your Company has ensured compliance with the provisions concerning the formation of the Internal Committee (IC) as mandated by the Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013. The IC comprises five members, including four Company officials and one external member from an NGO. Additionally, provisions related to the prohibition of sexual harassment have been incorporated into the IRCONs Conduct, Disciplinary, and Appeal Rules. At the beginning of the year, no complaint was pending. During the year, one complaint of sexual harassment was received and it was appropriately addressed within the stipulated time frame. As of the end of the year, no complaint was pending.

CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABILITY

Your Company is deeply committed to addressing social, ethical, and environmental concerns within the areas where it operates. We strive to contribute to the development of a sustainable society for future generations while meeting the expectations of our stakeholders. Throughout the years, IRCON has identified various Corporate Social Responsibility (CSR) concerns and implemented actions and initiatives that have had a positive impact on society and the environment. Our CSR activities cover a wide range of areas, including health, education, employment and skill development, environmental sustainability, clean water and sanitation, sports, culture and heritage, rural transformation, and contributions to the PM CARES Fund.

To guide our CSR efforts, we have the Corporate Social Responsibility & Sustainability Policy (CSR Policy) in alignment with our Companys vision. This policy lays down guidelines and mechanisms that the Company must adhere to when carrying out CSR projects. In accordance with the guidelines issued by the Department of Public Enterprises (DPE) through their Office Memorandum dated December 10, 2018, along with the update on May 12, 2021, CPSEs (Central Public Sector Enterprises) are required to follow a theme-based approach for their CSR activities. The Company allocates a minimum of 60% of their annual CSR budget for thematic programs and give preference to the Aspirational districts in their CSR initiatives. For the fiscal year 2022–23, the common theme chosen by DPE for CSR activities of CPSEs is "Health & Nutrition." By adhering to these guidelines and embracing the chosen theme, we are actively working towards making a positive difference in society and contributing to the well-being of our communities. During the past year, our company took a focused approach to conceive and implement CSR activities with the aim of generating maximum impact for the target beneficiaries. These initiatives were carried out in collaboration with reputable implementing agencies. In the fiscal year 2022–23, the actual expenditure on CSR activities amounted to Rs. 0.12 Crore, surpassing the allocated budget of Rs. 0.10 Crore. Within this budget, a significant portion was dedicated to the health sector, including a contribution of Rs. .53 Crore to the PM CARES Fund.

The CSR Policy, which provides comprehensive guidelines for conducting CSR activities, is available on our Companys website: www.ircon.org. Furthermore, the Annual Report on CSR & Sustainability activities, in compliance with Section 135 of the Companies Act, 2013, and the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, is appended to this report, forming an integral part of it.

QUALITY, HEALTH AND SAFETY QUALITY MANAGEMENT SYSTEM

IRCON is a precursor Public Sector Organization in adopting the Quality Management System Certification in the domestic as well as International Markets. Quality Management System (QMS) has been successfully sustained and continually improved since 1996 when the Company as a whole was first certified for ISO 9002:1994 by TUV SUD Private Limited. IRCON has continued the certification and sustained the system as per the latest version of Quality Management Standards, i.e. ISO 9001:2015 (by periodical re-certification audit after the expiry of every three years). Latest re- certification audit was conducted in September, 2022, whereby the Company has been re-certified by TUV SUD South Asia Private Limited for a period of another three years, i.e. up to March 2026.

OCCUPATIONAL HEALTH AND SAFETY MANAGEMENT SYSTEM

The Company established an Occupational Health & Safety Management System and was certified for ISO 45001:2004 in October, 2011. The latest surveillance audit for ISO 45001:2018 was conducted in August 2022, whereby the Company has been re-certified for another two years, i.e. up to December, 2024.

ENVIRONMENT MANAGEMENT

The Company established an Environment Management System (EMS) and was certified for ISO 14001:2004 in October 2011. The latest re-certification audit for ISO 14001:2015 was conducted in November 2022 whereby the Company has been re-certified for another three years, i.e. up to February 2026.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND UPGRADATION

IRCON is conscious of the limited nature of conventional sources and the importance of using energy resources wisely. The Company has been consistently laying emphasis on utilizing energy efficient equipment in its office premises and in various projects so as to minimally effect on the ecology and environment. Towards conservation of energy, IRCON has taken following steps during previous years: a) IRCON has installed a total of 90 kW Roof Top Grid Connected Solar Power Plant at Corporate Office which is a step to conserve energy and contributing to environment through usage of Green Energy. Total energy produced by Solar Power plant is 44,853 units of kWh which is 3.1% of the energy being drawn from BSES. IRCON has also installed a total of 75 kW Roof Top Grid Connected Solar Power Plant at its Gurgaon office building. b) Capacitor banks have been installed at Corporate Office building to improve power factor, which further reduces the Electrical Energy consumption. c) The internal lighting of Corporate Office building by energy-efficient LED lamps also adds in an energy saving of approx. 3,00,000 units of kWh per annum when compared with normal lights. d) Automatic / Dynamic Reactive Power Factor (APF) correction / compensation panels of Insulated

Gate Bipolar Transistors (IGBT) technology of 10.7 MVAR capacity have been designed and are being installed at the Receiving Substations (RSS) for Delhi-Ghaziabad-Meerut RRTS corridor of NCRTC project for RSS Energy Conservation. Moreover, the RSS Control Room Building is also constructed with highest rating of Indian Green Building Council (IGBC) standards to conserve energy. e) IRCON has also installed LED Lights for energy conservation which reduces energy consumption by upto 50% in various projects like Loco Shed at Bondamunda, Staff Quarters at Mathura-Kasganj- Kalyanpur RE Project, Katni-Singrauli RE Project, etc. and are also planned to be installed at USBRL E&M Tunnel Project. f) Capacitor Banks of 2400 kVAR capacity each have also been installed at Baramulla, Qazigund & Budgam TSS (J&K) for USBRL RE project and 04 Nos. Traction Sub-Stations (TSS) of Katni-Singrauli Project to improve the power factor. Further, Capacitor Banks of 5500 kVAR capacity each have been installed in Lalkuan & Kashipur TSS of Moradabad-Kashipur RE Project of Izzatnagar division. More than 34,750 units of electricity on a daily basis will be conserved on installing capacitor banks once electric trains are in operation. Moreover, for Tunnel Substations a total of 16 MVAR capacitor banks are being installed to regulate the reactive power generation due to jet fans, thereby reducing energy consumption.

STEPS TAKEN BY THE COMPANY FOR UTILISING ALTERNATE SOURCES OF ENERGY:

The Company is utilising the following as an alternate source of energy: a) IRCON is also providing the features similar to the Green Buildings Constructions at Corporate Office, Gurugram building and its project offices, thereby reducing the environmental impacts on water, materials, waste, energy and carbon emission. IRCON has installed solar panels at various offices/projects; and LED lights, sensor lights & sensor taps are also being used in the Corporate & other offices to conserve electricity. b) IRCON has also installed Solar Power Photovoltaic Panels for its office Complex in Sangaldan (J&K) with a capacity of 110 kWp.

CAPITAL INVESTMENT ON ENERGY CONSERVATION EQUIPMENT:

IRCON has planned to invest Rs. .2 Cr. approximately for replacing the existing Heating, Ventilation & Air Condition (HVAC) System at Corporate office with new technology Energy Efficient Inverter Type Air Conditioning System which will reduce the energy consumption by 20–30%.

Further, the old refrigerant of R-22 shall be replaced by the new technology refrigerant R-410A which is environment friendly and reduces the carbon emissions helpful in sustainable development.

TECHNOLOGY ABSORPTION AND UPGRADATION EFFORTS MADE TOWARDS TECHNOLOGY ABSORPTION:

Towards technology upgradation, the Company had purchased a New Track Construction (NTC) machine in 2019 for Dedicated Freight Corridor Project, CTP-12 (DFC project), which is successfully commissioned to improve productivity, safety, efficiency and quality in track laying at DFC Project. Your Company has secured a project for construction of Mumbai-Ahmedabad High Speed Railway (MAHSR) Project on December 24, 2021, which has been designated as the first High Speed Railway networks planned to be constructed in India. For this network the Japanese system of the Shinkansen Bullet Train has been selected for its safety, performance and reliability record. After securing the project, IRCON has finalized the detail programme of High- Speed Track construction based on Shinkansen technology for overall total length of 237 Km between Vapi and Surat Railway Stations. This Shinkansen track would be capable of running bullet trains at maximum permissible speed of 350 Kmph. The company has procured rail welding machine under Make In India scheme and is in the process of commissioning. The Shinkansen technology will use RCC track bed, J Track slabs, Cement Asphalt Grout, Special fittings and JIS Rails instead of conventional ballast-less track being constructed in Metro network of Railways in India.

BENEFITS DERIVED LIKE PRODUCT IMPROVEMENT, COST REDUCTION, PRODUCT DEVELOPMENT OR IMPORT SUBSTITUTION

With the deployment of NTC machine, 260-meter-long rail panel can be laid with uniform sleeper spacing and minimum manual interface. This ensures a better quality of track laying and faster progress of track laying with 1.5 km completion per day.

IN CASE OF IMPORTED TECHNOLOGY (IMPORTED DURING THE LAST THREE YEARS RECKONED FROM THE BEGINNING OF THE FINANCIAL YEAR) – N.A. RESEARCH AND DEVELOPMENT

The Company being primarily an EPC company does not undertake any pure research project but takes the help of consultants and firms to innovate and to develop methods and techniques to execute projects in a cost-effective manner, with requisite quality, to enhance the technical competence and efficiency.

INFORMATION TECHNOLOGY AND ERP

The Companys Information Technology (IT) department offers a range of services encompassing Data Networks, implementation of company-wide software applications, procurement of IT hardware equipment, as well as the implementation of Highway Traffic Management Systems (HTMS), Toll Management Systems (TMS), and Weigh-in-Motion systems for major highway projects undertaken and operated by IRCON and its Joint Venture companies as concessioners. IT serves not only as a service provider but also plays a vital role in enhancing productivity within IRCON.

IRCON has recently upgraded to SAP S/4 Hana as Enterprise Resource Planning (ERP) application software for the operations of Finance, Controlling and Human Resource Management. It is leading to company wide information availability, transparency and has enabled faster decision making. SAP Business Objects (SAP BO) an analytical product of SAP was added to SAP implementation to automate on-demand financial reporting. This reporting tool fetches real-time data from SAP and helps in preparation of Financial Statements of the Company. Employee Self Service Portal, Finance and HCM modules of SAP have been rolled out for entire organization and five pilot locations are under go live for full functionalities. The financial statements for the year ended March 31, 2023 were prepared from SAP S4-HANA and salaries of employees are also being processed through its payroll module from April 2022 onwards. Fully functional SAP S4-HANA after implementation will cover end-to-end business processes of IRCON. S4-HANA ERP softwares server infrastructure is hosted on RailTel cloud on a MEITY empaneled Datacenters to ensure secured access in high availability environment where in there is scope for capacity augmentation without disruption of regular services.

E-Office system is deployed across IRCON for all domestic and foreign projects. It is a step towards paperless office initiative from Government of India for the approvals and movement of files, note sheets and other official documents. It is complete replacement of physical file system with loss less and undeletable data facility, and Digital Signature authentication features.

Implementation of S4-HANA as well as e-office will be in conjunction to each other, and has helped IRCON to march ahead with near paperless requirement in the entire organization.

Dedicated video conferencing facility based on cutting edge AI based online meeting is being widely used for conducting review meetings with project offices, trainings, promotion interviews and contract management issues etc.

Cyber and Social Engineering attacks are a big concern now a days for organizations information security. IRCON has made efforts in this area and has formulated a Cyber Security Management Plan. Incidents of Cyber-attack are reported to CERT-IN for record and further guidance. Steps are being taken to ensure that proper Cyber security audits are done as per industry practice and norms.

CORPORATE GOVERNANCE

The Company places great emphasis on adhering to corporate governance guidelines and best practices, recognizing their significance in enhancing long-term shareholder value and upholding minority rights. It considers it a fundamental obligation to provide timely and accurate information regarding the Companys operations, performance, leadership, and governance. In compliance with Regulation 34 of the LODR Regulations and DPE Guidelines on Corporate Governance for Central Public Sector Enterprises issued in May 2010, the Corporate Governance Report, along with the compliance certificates of Corporate Governance norms under the aforementioned LODR Regulations and DPE Guidelines, is attached and constitutes an integral part of this report.

BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

As on March 31, 2023, the Company has ten directors of which four are whole-time directors [Chairman & Managing Director, Director (Finance), Director (Works) and Director (Projects) (additional charge)], two Government Nominee Directors and four Independent Directors.

The Company has requested the Ministry of Railways for appointmentof requisitenumberof IndependentDirectors in order to comply with the statutory requirements. There were two vacancies to the post of Independent Directors. Pursuant to Section 203 of the Companies Act, 2013, the Board of Directors had declared Chairman & Managing Director (CMD) as deemed Chief Executive Officer (CEO) and all the Whole-time Directors and Company Secretary as Key Managerial Personnel (KMP) of the Company. The senior most finance official of the Company is designated as Chief Financial Officer (CFO) and KMP.

Board of Directors & Key Managerial Personnel (KMP) as on March 31, 2023

The Board of Directors of the Company as on March 31, 2023 were Executive (Functional) Directors viz.– Shri Yogesh Kumar Misra (DIN: 07654014), Chairman

& Managing Director & CEO, Smt. Ragini Advani, (DIN: 09575213), Director (Finance), Shri Parag Verma, (DIN: 05272169) Director (Works), Shri Sandeep Jain (DIN:

09435375) Director (Projects) (Additional Charge); Part-time (Official) Directors viz. Shri Brijesh Kumar Gupta (DIN: 10092756) and Shri Dhananjaya Singh (DIN: 08955500); being Government Nominee Directors and Independent Directors viz. Shri Ajay Kumar Chauhan (DIN: 09394953), Shri Dipendra Kumar Gupta (DIN: 09398271), Smt. Ranjana Upadhyay (DIN: 07787711) (woman independent director) and Dr. Kartik Chandulal Bhadra (DIN: 09453387).

In addition to the CEO and whole-time directors, other KMP, as on March 31, 2023 were Shri B Mugunthan, Executive Director (Finance) & CFO and Ms. Ritu Arora, Company Secretary.

Appointments and cessation of the Directors and KMP during and after close of the FY 2022–23

Changes in the post of Chairman & Managing Director: After close of the financial year 2022–23, pursuant to Railway Board letter dated April 29, 2023, with effect from April 29, 2023 Shri Yogesh Kumar Misra (DIN: 07654014) relinquished the charge of the post of Chairman & Managing Director and Shri Brijesh Kumar Gupta (DIN: 10092756) assumed the additional charge of the post of Chairman & Managing Director. Shri Gupta is proposed to be regularized as Chairman & Managing Director (Additional Charge) of the Company at the ensuing AGM of the Company. Changes in the post of Functional Directors Smt. Ragini Advani (DIN: 09575213) was appointed as Director (Finance) (Additional Director) of the Company w.e.f. April 19, 2022 and regularized as Director (Finance) on June 29, 2022 through Postal Ballot.

Shri Parag Verma (DIN: 05272169) was appointed as Director (Works) (Additional Director) of the Company w.e.f. September 21, 2022. He was regularized as Director (Works) on December 14, 2022 through Postal Ballot. Shri Shyam Lal Gupta (DIN: 07598920) ceased to be Director (Projects) on December 31, 2022, due to superannuation. Shri Sandeep Jain, IRSE, Executive Director Planning (Civil & PSU) – Railway Board, entrusted with the additional charge of Director (Projects) (Additional Director) w.e.f. January 12, 2023 and ceased to be Director (Projects) (additional charge) on July 07, 2023, due to relinquishment of charge on appointment of regular incumbent to the post of Director (Projects). Shri Anand Kumar Singh (DIN: 07918656), IRSE on selection by PESB has been appointed as Director (Projects) (Additional Director) w.e.f. July 07, 2023. Shri Singh is proposed to be regularized as Director (Projects) of the Company at the ensuing AGM of the Company.

Shri Mohit Sinha (DIN: 00843548), Additional Member (Revenue), Railway Board relinquished the additional charge of the post of Director (Finance) of the Company w.e.f. April 19, 2022.

Changes in the post of Part-time (Official) Director / Government Nominee Director: Shri Brijesh Kumar Gupta (DIN: 10092756), Additional Member (CE), Railway Board was appointed as Part-Time (Official) Director (Government Nominee Director) (Additional Director) of the Company w.e.f. March 29, 2023 who then assumed the additional charge of the post of Chairman & Managing Director w.e.f April 29, 2023. Shri Rajesh Argal, former Additional Member (Planning), Railway Board ceased to be Part-Time (Official) Director (Government Nominee Director) of the Company w.e.f. July 31, 2022 on attaining the age of superannuation. Shri Ram Prakash, Additional Member (Planning) (L/A) (DIN: 09746225) was appointed as Part-Time (Official) Director (Government Nominee Director) (Additional Director) of the Company w.e.f. September 23, 2022. He was regularized on December 14, 2022 through Postal Ballot and he ceased to be Director on January 31, 2023 on attaining the age of superannuation.

Regularization of Independent Directors:

Shri Ajay Kumar Chauhan, Shri Dipendra Kumar Gupta, Smt. Ranjana Upadhyay (Women Independent Director) and Dr. Kartik Chandulal Bhadra who were appointed as Independent Directors (Additional Directors) during FY 2021–22 were regularized as Independent Directors on the Board of the Company on June 29, 2022 through Postal Ballot.

Change in the KMPs:

Shri B Mugunthan, Executive Director (Finance), was appointed as CFO & KMP w.e.f. April 26, 2022.

The complete details of appointment / relinquishment of post by the Directors and other related details are provided in the Corporate Governance report forming part of Annual Report.

INDEPENDENT DIRECTORS DECLARATION

The Company has received necessary declaration from all Independent Directors that he/she meets the criteria of independence as laid out in Section 149(6) of the Companies Act, 2013 and Regulations 16(1)(b) and 25(8) of the LODR Regulations. The declarations have been noted by the Board of Directors.

The Ministry of Corporate Affairs (MCA) has issued notifications in October 2019, relating to the creation and maintenance of the data bank for independent directors by Indian Institute of Corporate Affairs at Manesar, Haryana (IICA). Under Section 150(1) of the Companies Act, 2013, IICA conducts Online Proficiency Self-Assessment for

Independent Directors. Accordingly, all the Independent Directors of the Company are registered with data bank of IICA.

APPOINTMENT / RE-APPOINTMENT OF DIRECTORS THROUGH POSTAL BALLOT

Pursuant to the provisions of Section 152(2) of the Companies Act, 2013 every director of the Company has to be appointed in the general meeting of the Company. Further pursuant to LODR Regulations, every listed entity shall ensure that approval of shareholders for appointment of a person on the Board of Directors is taken at the next general meeting or within a time period of three months from the date of appointment. However, CPSEs are allowed that the approval of the shareholders for appointment or re-appointment of a person on the Board of Directors or as a Manager is taken at the next general meeting.

RETIREMENT OF DIRECTORS BY ROTATION

In terms of Section 152 of the Companies Act, 2013, the provisions in respect of retirement of Directors by rotation will not be applicable to the Independent Directors. In view of this, all directors (other than the Independent Directors) are considered for retirement by rotation. Accordingly, as per provisions of the Companies Act, 2013, Smt. Ragini Advani, Director (Finance) is liable for retirement by rotation at the ensuing Annual General Meeting (AGM) of the Company and being eligible, offer herself for re-appointment.

The details of such Director seeking re-appointment / appointment at the ensuing AGM are contained in the Notice convening ensuing AGM of the Company.

Board Meetings:

The Board met eight (8) times during the FY 2022–23, on April 26, 2022; May 27, 2022; July 22, 2022; August 08, 2022; September 23, 2022; November 11, 2022; December 31, 2022; and February 08, 2023. The necessary quorum in terms of LODR Regulations was present for all the meetings. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013, DPE Guidelines and LODR Regulations.

During the FY 2022–23, all the meetings (except one) of the Board were held at the Companys Registered Office, in New Delhi, through physical and Video Conferencing mode. One Board Meeting was held at Shillong, Meghalaya in compliance with the direction of the DPE for holding Board Meeting / Strategic meets of CPSEs at destinations which have potential for development of tourism sector in the country.

Committee meetings:

Your Companys Board has the following committees:

1. Audit Committee

2. Nomination & Remuneration Committee

3. Stakeholders Relationship Committee

4. Risk Management Committee

5. Corporate Social Responsibility & Sustainability Committee

6. Project Progress Review Committee

During the FY 2022–23, the Audit Committee of the Board met eight (8) times, the Nomination & Remuneration Committee met five (5) times, Stakeholders Relationship Committee met one ( 1 ) time; Risk Management Committee of the Board met two (2) times; the Corporate Social Responsibility & Sustainability Committee met six (6) times, and the Project Progress Review Committee met one (1) time.

Details of constitution, terms of reference of the Committees, and attendance of Directors at meetings of the Committees are provided in the Corporate Governance Report forming part of Annual Report.

Separate Meeting of Independent Directors

In compliance with the provisions of Regulation 25(3) of LODR Regulations, Schedule IV of the Companies Act, 2013 and DPE OM dated March 20, 2013, one separate meeting of Independent Directors was held on March 16, 2023 (which continued on March 17, 2023) without the presence of other Board Members.

SELECTION OF NEW DIRECTORS AND BOARD MEMBERSHIP CRITERIA

IRCON being a Government Company, the appointment of directors on its Board is made by the President of India through the Administrative Ministry, Ministry of Railways. The key qualifications, skills, expertise and attributes of the Directors is included in the Corporate Governance Report.

PERFORMANCE EVALUATION

IRCON is a Government Company that operates under the administrative control of the Ministry of Railways. The appointment procedure for all directors is prescribed by the Government of India, and the directors of the Company have been appointed in accordance with this procedure. The selection of functional directors, including the Chairman and Managing Director (CMD), follows the recommendations of the Public Enterprises Selection Board (PESB) in line with the procedure and guidelines set by the Government of India. The Department of Public Enterprises (DPE) has also established a system and procedure for evaluating the performance of functional directors, including the CMD.

The evaluation framework for assessing the performance of functional directors encompasses several key areas: a) The performance of the Company under the Memorandum of Understanding (MOU) signed with the Ministry of Railways, including the achievement of targets set for each respective director. b) The evaluation process involves self-assessment by the functional directors themselves, followed by an assessment by the CMD, and finally, a comprehensive evaluation by the Ministry of Railways (the Administrative Ministry). c) For the CMD, the evaluation includes self-assessment and a final evaluation conducted by the Ministry of Railways.

Regarding Government Nominee Directors, their evaluation is carried out by the Ministry of Railways in accordance with the prescribed procedure. Independent Directors, who are also appointed by the Government of India, undergo evaluation by the Ministry of Railways and, ultimately, by the DPE.

REMUNERATION POLICY FOR THE BOARD AND SENIOR MANAGEMENT

As a Government Company, IRCON follows the guidelines issued by the Department of Public Enterprises (DPE) for determining the remuneration of its functional directors, senior management officials, and other employees. The Company has placed the salient features of its remuneration policy for key managerial personnel and employees on its website (www.ircon.org) under the HRM and Career Sections, as required by Section 178(4) of the Companies Act, 2013.

The remuneration policy of the Company, as well as the procedures and policies for the appointment of Senior Management, are reviewed and recommended by the Nomination & Remuneration Committee before being approved by the Board of Directors.

Furthermore, under Section 197 of the Companies Act, 2013, and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, listed companies are required to disclose specific details of directors remuneration in the Boards Report. However, Government Companies, including IRCON, are exempted from complying with this provision as per Notification No. GSR 463(E) dated June 5, 2015, issued by the Ministry of Corporate Affairs.

Therefore, such details are not included in the Boards Report of IRCON. However, the remuneration paid to directors during FY 2022–23 is disclosed in the Corporate Governance Report.

INTERNAL CONTROL SYSTEMS

The Company has implemented robust financial controls in accordance with the provisions of the Companies Act, 2013. These internal financial controls over financial reporting are functioning effectively. The controls are designed to ensure the maintenance of accurate accounting records, promote the orderly conduct of business operations in compliance with company policies, safeguard company assets, prevent and detect fraud and errors, and ensure the reliability of financial and operational information. The internal control system, which includes Internal Financial Controls over Financial Reporting, undergoes periodic reviews, and necessary adjustments are made to align with evolving business needs.

Further information about the internal control system can be found in the Management Discussion and Analysis Report.

INTERNAL CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING

Your Company has adopted an ‘Internal code of conduct for prevention of insider trading in dealing with securities of the Company (Code of Conduct), to regulate, monitor and report trading by designated persons and their immediate relatives and code for practices and procedures for fair disclosure of Unpublished Price Sensitive Information (UPSI) as per the requirement under SEBI (Prohibition of Insider Trading) Regulations, 2015. The Code of Conduct aims that the insiders of the Company shall not derive any benefit or assist others to derive any benefit from the access to and possession of UPSI about the Company which is not in the public domain and thus constitutes insider information.

The Code of Conduct as approved by the Board has been posted on the website of the Company, i.e., www.ircon. org under the head Codes and Policies in the Investors section.

RISK MANAGEMENT

The Company has an elaborate Enterprise Risk Management (ERM) framework, including risk management policy for risk identification and its mitigation.

As per the LODR Regulations, the Company is having a Board level Risk Management Committee, which as on March 31, 2023 comprised of Director (Works) as Chairman, Director (Finance), Director (Projects), and Dr. Kartik Chandulal Bhadra, Independent Director as members. Details of the Risk Management System are provided in the Management Discussion and Analysis Report and the Risk

Management Committee are provided in the Corporate Governance Report.

WHISTLE BLOWER POLICY / VIGIL MECHANISM AND VIGILANCE ACTIVITIES

Being a Government Company, the Company has a separate Vigilance Department which deals with fraud or suspected fraud involving employees/ representatives of suppliers, contractors, consultants, service provider or any other party doing business with the Company. Whistle Blower and Fraud Prevention and Detection Policies have been approved by the Board of Directors and are available on the website of the Company. The Company has in place the necessary vigil mechanism for employees and directors to report to the Management concerns about unethical behavior, actual or suspected fraud, violation of the Companys Code of Conduct or ethics policy and instances of a leak of unpublished price sensitive information. If one raises a concern under this Policy, the complainant will not be at risk of suffering any form of reprisal or retaliation (including discrimination, reprisal, harassment or vengeance) in any manner. No person has been denied access to the Chairman & Managing Director, IRCON or to Chairman of the Audit Committee.

The Vigilance Department plays an advisory role to the top management in matters pertaining to vigilance. It is headed by a full-time Chief Vigilance Officer (CVO) appointed by the Appointments Committee of the Cabinet (ACC) in consultation with Central Vigilance Commission (CVC).

The Department ensures implementation of laid down guidelines/procedures through preventive checks of tenders and contracts, execution of works, and other functions as well as carry out investigations into complaints. During FY 2022–23, the Department has carried out 01 surprise inspection and 06 periodic inspections on high-value projects. Apart from surprise and periodic inspections department has carried out 04 preventive inspections on tenders floated from the corporate office. Chief Technical Examiners Organisation (Technical wing of Central Vigilance Commission) has also carried out extensive investigation of 01 Project. Complaints raised against officials and procedures, etc., by various Authorities (such as CVC/Railway Board Vigilance, CBI, Prime Ministers Office, etc.,) and received from other sources were investigated to their logical conclusion. During FY 2022–23, the Department has received a total of 12 nos. complaints and total 11 nos. complaints were disposed off including that of previous years. Nature of Complaints includes irregularities during tendering, execution of contract, anonymous & pseudonymous and quality related issues. Also steps were taken for closure of Paras raised by the Chief Technical Examiners Organisation (CTEO). In addition, scrutiny of immovable property returns of employees, creating awareness on rules/procedures/common irregularities in execution through workshops, training, debate, competitions, etc., have been the prime activities of the Department. As a step towards ‘Leveraging of Technology for better transparency, online services are efficiently running since years viz, submission of immovable Property Returns since 2012–13; online Vigilance Clearance since April 1, 2014 through the intranet portal; and filing of vigilance complaints since December 2012.Further, E-Procurement has already been started w.e.f July 1, 2013 in the organisation in a comprehensive manner for achieving transparency for all value of the work.

IRCON has adopted Integrity Pact (IP) as recommended by the Central Vigilance Commission (CVC) on June 24, 2014, for tenders/contract for works and supply with an estimated value of Rs. Crore and above on all Indian Projects. The Integrity Pact is made a compulsory document in the conditions of model e-Procurement Documents for all works. IRCON has implemented this Integrity Pact which is a tool developed by Transparency International and it ensures that all activities and transactions between a Company or Government Departments and their Suppliers are handled in a fair, transparent and corruption-free manner.

As per the provision of Integrity Pact and relevant guidelines of Central Vigilance Commission, Dr. T.M. Bhasin, Ex. Central Vigilance Commissioner, has been appointed as an Independent External Monitor (IEM) on November 18, 2020 as per earlier SOP and Shri Bimal Julka, Retired IAS, has been appointed on November 30, 2021 as 2nd IEM as per revised SOP to receive any complaints from the bidders and submit the investigation report. Vigilance strives to achieve its objective of promoting an impartial, fearless, and transparent environment in the functioning of the organization by taking steps to prevent unethical practices.

RELATED PARTY TRANSACTIONS

Pursuant to the provisions of Section 177 and 188 of the Companies Act 2013 (the Act) and LODR Regulations, prior approval of the related party transactions wherever applicable are taken from the Audit Committee / Board as applicable. Prior omnibus approval of the Audit Committee is also obtained on yearly basis for various Related Party Transactions between IRCON or any of its subsidiaries on one hand and a related party of the IRCON or any of its subsidiaries on the other hand in the ordinary course of business valuing not exceeding Rs. Crore for each contract / agreement / transaction in a financial year. The transactions, if any, entered into pursuant to the omnibus approval granted, are placed before the Audit Committee on a quarterly basis. Approval of specific related party transactions other than those covered under the Omnibus approval are also obtained from the Audit Committee/ Board in compliance with the requirement of the Companies Act 2013 and LODR Regulations. In pursuance to Section 134(3)(h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014, the "Disclosure of particulars of contracts / arrangements entered by the Company with related parties including certain arms-length transactions" are disclosed in Form AOC-2 and is annexed to this Report. The Related Party Transaction Policy of the Company has been revised and approved by the Board during the year 2022–23 and is uploaded on the Companys website under the ‘Investors section at www.ircon.org.

DIRECTORS RESPONSIBILITY STATEMENT

The Board of Directors of the Company confirms: i) that in the preparation of the financial statements, the applicable accounting standards had been followed except as otherwise stated in the annual financial statements and there has been no material departure; ii) that such accounting policies were selected and applied consistently and such judgments and estimates were made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company for the financial year ended on March 31, 2023, and of the profit of the Company for the FY 2022–23; iii) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities; iv) that the financial statements have been prepared on a going concern basis; v) that internal financial controls were adequate and operating effectively; and vi) that proper system has been devised to ensure compliances with the provisions of all applicable laws and that such systems were adequate and operating effectively.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

The "Business Responsibility and Sustainability Report"

(BRSR) in compliance with the provisions of Regulation 34 of the LODR Regulations, in the format prescribed under SEBI Circular May 05, 2021 forms part of the Report. The report describes the initiatives taken by IRCON from an environmental, social and governance perspective.

MOU RATING / AWARDS

As per the DPE guidelines, the Ministry of Railways and IRCON enter into a Memorandum of Understanding (MOU) annually, outlining selected parameters and targets for each financial year. The Companys performance is evaluated at the end of the year based on the achievement of these targets. According to the MOU parameters and the Companys performance in the fiscal year 2021–22, it has received a rating of ‘Very Good. IRCON has been awarded several prestigious awards. Some of the significant awards and accolades won so far during the year 2022–23 are mentioned below:

a Greentech Environment Award for Environment Protection

a ENR – Construction World Global Award

a Dun & Bradstreet PSU & Government Summit_- Aatma Nirbhar Bharat Initiatives

STATUTORY AUDITORS

The Comptroller & Auditor General of India (C&AG) has appointed M/s HDSG & Associates, Chartered Accountants, New Delhi (Firm Registration No.002871N) as the single Statutory Auditors of the Company for FY 2022–23, except for the following foreign projects for which C&AG has approved the appointment of the following as statutory auditors:

COST AUDITORS

In pursuant to the provisions of Section 148 of the Companies Act, 2013 and rules made thereunder, the Company has maintained the cost records of the Company. The Board of Directors has appointed M/s R.M. Bansal & Co., Cost Accountants, (having firm Registration No.000022) as Cost Auditor of the Company for the FY 2022–23 for conducting the audit of cost records

SECRETARIAL AUDITORS

In pursuant to the provisions of Section 204 of the Companies Act, 2013 and Regulation 24A of the LODR Regulations, the Board of Directors has appointed M/s Kumar Naresh Sinha & Associates, Company Secretary in practice (Firm Registration No. S2015UP440500) as the Secretarial Auditor for conducting Secretarial Audit of the Company for the FY 2022–23.

INTERNAL AUDITORS

The Board of Directors have appointed following Internal Auditors for the Indian & F o r e i g n Projects for the FY 2022–23:

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

IRCON is engaged in the business of providing infrastructure facilities and is exempted from compliance with all the provisions of Section 186 [except sub-section (1) to Section 186] in terms of Section 186(11)(a) read with Schedule VI of the Companies Act, 2013.

The details of investments made, loans granted, and guarantees extended by the Company to its subsidiary and joint venture companies during the FY 2022–23 forms part of the notes to the standalone financial statements provided in the Annual Report.

DEPOSITS

The Company did not accept any deposits from the public during the financial year.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 92(3) and 134(3)(a) of the Companies Act, 2013, the Annual Return of the Company as at March 31, 2023 is placed on the website of the Company at www. ircon.org, under the Investors section.

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

The Company has complied with the provisions relating to the Investor Education and Protection Fund (IEPF) under the Companies Act, 2013 and the rules made thereunder. Company Secretary is the nodal officer to deal with the IEPF Authorities and compliances related thereto.

No amount is due for transfer to IEPF and details of unclaimed dividend as on March 31, 2023 are available on the website of the Company, and this is also disclosed in the Corporate Governance report. Further, the Company does not have shares in Demat Suspense Account/ Unclaimed Suspense Account/ Unclaimed Dividend Account and the same has been disclosed in the Corporate Governance report.

SECRETARIAL STANDARDS

During the financial year, the Company is in compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI).

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

No order has been passed by the Regulators or Courts or Tribunals impacting the going concern status of the Company and its operations in future during the FY 2022–23.

DETAILS OF APPLICATION MADE OR ANY PROCEEDINGS PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 DURING THE YEAR ALONG WITH THEIR STATUS AS AT THE END OF THE FINANCIAL YEAR.

There are no proceedings initiated/pending against your Company under the Insolvency and Bankruptcy Code, 2016 which will have material impact on the business of the Company.

CHANGE IN THE NATURE OF BUSINESS

There was no material change in the nature of business of the Company during the FY 2022–23.

DIVIDEND DISTRIBUTION POLICY

In terms of Regulation 43A of LODR Regulations and the guidelines on "Capital Restructuring of Central Public Sector Enterprises" issued by the DIPAM, the Board of Directors of the Company has formulated and adopted the Dividend Distribution Policy. The Policy is hosted on the Website of the Company at https://ircon.org/ images/file/cosecy/Dividend%20Distribution%20Policy. pdf.

SECRETARIAL AUDIT REPORT AND MANAGEMENT RESPONSE THERETO

The "Secretarial Audit Report" from the secretarial auditor in Form MR-3 as required under Section 204 of the Companies Act, 2013 read with rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this report.

The Management Response on the qualification in the Secretarial Auditor Report and compliance of conditions of Corporate Governance for the FY 2022–23 forms part of this report.

STATUTORY AUDITORS REPORT AND C&AG COMMENTS

The reports of the Statutory Auditors on the Financial Statements for FY 2022–23 (both on standalone and consolidatedfinancialstatements)areattachedseparately as part of the Annual Report. There are no qualifications, reservations or adverse remarks made by M/s HDSG & Associates, Statutory Auditors, in their report for the financial year ended on March 31, 2023.

Comments of C&AG on the Audited Financial Statements of your Company for the FY 2022–23 are attached.

ACKNOWLEDGEMENT

The Directors of the Company would like to extend their heartfelt gratitude and acknowledgement for the invaluable assistance and cooperation received from various Ministries such as Railways, Road Transport and Highways (MoRTH), External Affairs, Finance, Commerce, Urban Development, as well as other ministries, departments, and agencies. We are also grateful for the support received from the office of Comptroller & Auditor General of India, Reserve Bank of India, Bankers, Statutory, Branch, Cost, Secretarial & Internal Auditors, of the Company, Indian Embassies & Missions abroad, Foreign Missions & Embassies in India, EXIM Bank, ECGC Limited, Protector of Immigration, Passport Authority, and our esteemed clients both within India and overseas as without their active support, the Company would not have achieved its milestones during the year under review.

We would like to express our sincere appreciation to all the dedicated employees of the Company at every level. Their unwavering efforts, dedication, sincerity and commitment have significantly contributed to achieving the highest ever performance of the Company.