Kaushalya Infra. Management Discussions


Indian infrastructure companies had a mixed bag of results in the year ending March 2023. On the one hand, they saw strong growth in the domestic market, driven by government spending on infrastructure projects. This led to increased revenue and profits for many companies. On the other hand, Indian infrastructure companies faced challenges in the foreign market. The global economy slowed in 2023, and this led to a decline in demand for infrastructure projects in some countries. This, in turn, led to delays and cancellations of some projects, and it also hurt the profitability of Indian companies that were operating in these markets.

Despite these challenges, the long-term outlook for Indian infrastructure companies remains positive. The Indian government is committed to investing in infrastructure, and this will create opportunities for Indian companies in the coming years. In addition, the Indian market is growing rapidly, and this will also create opportunities for Indian companies.

Here are some of the key trends that are shaping the Indian infrastructure industry in 2023:

• The focus on public-private partnerships: The Indian government is increasingly looking to public-private partnerships (PPPs) to finance infrastructure projects. This is because PPPs can help to attract private investment into the infrastructure sector, and they can also help to reduce the financial burden on the government.

• The rise of green infrastructure: There is a growing demand for green infrastructure in India, as the government is committed to reducing the countrys carbon emissions. This is creating opportunities for Indian companies that are involved in the development of green infrastructure projects.

• The adoption of new technologies: New technologies, such as 3D printing, drones, and artificial intelligence, are being used to improve the efficiency and effectiveness of infrastructure projects. These technologies are helping to reduce costs, improve safety, and speed up construction times.

Overall, the Indian infrastructure industry is facing a number of challenges in 2023. However, the long-term outlook for the industry remains positive, as there is strong demand for infrastructure projects in India.


The infrastructure sector plays a pivotal role in driving the Indian economy forward. It serves as a crucial catalyst for overall development and receives significant attention from the Government, which is committed to implementing policies aimed at creating top-notch infrastructure within specific timelines.

Engaging in a joint venture, your company undertook a contract to establish a 2-megawatt hydro power project for Uttarakhand Jal Vidyut Nigam Ltd (UJVNL), where it held the lead position with a substantial 90% ownership. Unfortunately, issues arose during project execution, resulting in contract termination. To recoup incurred expenses and projected profits lost due to termination, your company initiated arbitration against UJVNL. This legal process concluded favorably in April 2022, with an awarded verdict in the joint ventures favor. However, UJVNL contested the decision, leading to an ongoing appeal before the Additional District Judge in Dehradun. As of now, the matter remains subjudice, with hearings continuing to determine the final resolution of the dispute.

The hotel business segment of our Company has sustained its performance and accounted for more than half of our total revenue from operations. Recognizing its potential for further growth, we are actively exploring investment options to enhance our hotel business. Our plans include renovating the hotel premises, upgrading facilities, and investing in modern amenities to elevate the guest experience.

Your Company is actively bidding for construction contracts and exploring new opportunities in the sector. We are optimistic about taking up new projects in the near future, contributing to the industrys growth and delivering exceptional results.


• Strength:

Your Company is an integrated infrastructure company with inherent strengths of experienced management team. Over the years, our company has undertaken a wide array of diverse construction projects, which has established a strong brand awareness and reputation in the industry. This esteemed recognition serves as a valuable asset, bolstering our business strategies and enhancing our execution capabilities.

The expertise of our Company in efficiently managing large civil and electrical construction projects, coupled with our successful venture in the hotel business, gives us a distinct advantage. With ample land available for expanding our hotel facilities, we are poised for substantial growth in this segment. Moreover, our highly skilled and qualified teams bring a wealth of experience to the table, overseeing and executing all aspects of project development.

• Weaknesses:

The availability of liquidity remains a significant challenge for our Company. A substantial portion of our liquidity is tied up in project disputes, hindering our financial flexibility. To address this issue, we are actively pursuing out-of-court settlements for various litigated awards, aiming to avoid prolonged litigation at different forums. Additionally, we recognize the need to overhaul our ageing fleet of equipment to maintain competitiveness in the market. Emphasizing continuous technological upgrades, we strive to stay ahead in the industry. However, it is crucial to acknowledge that changes in macroeconomic variables, such as GDP growth, interest rates, inflation, tax policies, trade regulations, and monetary policies, may exert adverse effects on our business, profitability, and overall financial condition. As a result, we remain vigilant and agile, ready to adapt to dynamic economic scenarios to sustain our growth and success.

• Opportunities:

The infrastructure sector continues to receive unwavering attention from the government, indicating substantial growth opportunities for the industry. Leveraging our Companys strength and extensive experience in this field, we are confident in our ability to convert these opportunities into profitable project ventures. Although we acknowledge and actively address our key weaknesses, our management remains optimistic about undertaking new projects successfully. With infrastructure development being a primary focus for the government, the potential for growth is immense, providing us ample opportunities to capitalize on. Our track record of successful project execution adds credibility, enabling us to competitively bid for infrastructure projects. Engaging in discussions for new ventures, we are determined to propel the Company back on a path of growth and prosperity.

• Threats

Several threats loom beyond the control of our infrastructure company, including industry slowdowns during difficult economic times. While we are confident in identifying and seizing opportunities, we encounter various challenges such as unforeseen project approval delays, the growth of auxiliary infrastructure facilities, etc. The Indian real estate sectors unorganized nature, with intermediaries and subdued demand, adds complexity, and rising prices of raw materials and reduced trade credit intensify project costs and squeeze profit margins. The prolonged sanction procedure, varying from days to years due to the lack of a single-window clearance option, results in time and cost escalations. Moreover, the liquidity crisis or adverse shifts in real estate lending policies by banks can significantly impact project execution and borrowing costs. At the company level, threats arise from overturning litigation awards, adverse tax litigation orders, and prolonged appeals processes that lock liquidity. To address these challenges, we actively pursue amicable out-of-court settlements while engaging highly skilled legal professionals to handle various cases.



For the financial year ended 31st March 2023, our Companys revenue witnessed significant growth, reaching Rs. 109.86 Lakhs compared to Rs. 16.28 Lakhs in the previous year.


For the year ended 31st March 2023, your Companys total expenditure, encompassing contract & site expenses, employee benefit costs, depreciation, material consumed, and other expenses, amounted to Rs. 273.70 Lakhs. In comparison, the total expenditure in the previous year was Rs. 261.77 Lakhs.


During the year ended 31st March 2023, the Companys interest expenses amounted to Rs. 60.68 Lakhs, while in the previous year, it was Rs. 58.39 Lakhs.

Profit before Tax (PBT)

In the current financial year ended 31st March 2023, the Companys Profit Before Tax (PBT) was Rs. (163.83) Lakhs, compared to the previous year PBT which was Rs. 46.14 Lakhs.

Profit after tax (PAT)

For the year ended March 31, 2023, your Companys Profit After Tax was Rs. (177.71) Lakhs compared to the previous year PAT of Rs. 6.33 Lakhs.

Earnings Per Share (EPS)

The earnings per share for the current year is Rs. (0.51) as compared to 0.02 per equity share in the previous year.

Consolidated Financial Statements

The Consolidated Financial Statements of the Company are prepared in accordance with the relevant Indian Accounting Standards issued by the Institute of Chartered Accountants of India and forms an integral part of this Report. In accordance with Section 129(3) of the Companies Act, 2013, and Rule 5 of the Companies (Accounts) Rules, 2014, a statement encompassing the significant features of the financial statements of Subsidiaries, Associate Companies, and Joint Ventures is provided in Form AOC-1, which is an integral part of this Report.

The Companys results are consolidated with its subsidiaries, step-down subsidiary, associates and Joint Venture.

Human Resources

Your Company places utmost importance on its Human Resources, recognizing them as the most critical assets within the organization. We are committed to continuously improving the efficiency and effectiveness of our workforce, leveraging their potential to maintain a competitive advantage. Fair and equitable treatment of our employees is a fundamental principle we adhere to, and we consistently invest in their welfare. Our work environment fosters cordiality and informality, encouraging collaboration and empowering individuals. We believe in a decentralized approach, delegating authority at all levels and promoting leadership development across the organizational structure. Remuneration is aligned with industry standards, ensuring that our employees are fairly compensated. Moreover, we actively support their professional growth by encouraging skill enhancement training and participation in external seminars relevant to their areas of expertise. As a result of our peoplecentric approach, we have achieved a low attrition rate and boast a highly skilled and motivated workforce.

Other Disclosures

During the financial year, in a subjudice matter, the Enforcement Directorate took action to attach specific bank accounts of the company, invoking the provisions of the Prevention of Money Laundering Act, 2002. The Adjudicating Authority had confirmed the said attachment. In response to this, the company, exercising its legal rights, initiated an appeal before the Appellate Tribunal to challenge the Adjudicating Authoritys decision to confirm the attachment.

As of now, the matter remains under judicial consideration with the Appellate Tribunal as the legal proceedings unfold.

Cautionary Statement

The Management Discussion and Analysis section of the report contains forward-looking statements that describe the Companys objectives, expectations, or predictions, as permitted by applicable securities law and regulations. It is important to note that actual results may differ significantly from what is expressed in these statements. Several factors could impact the Companys operations, including intense competition leading to price reductions, fluctuations in prices of key inputs such as steel, cement, building materials, and petroleum products, changes in government regulations and tax laws, economic developments within the country, and other variables like litigation and industrial relations. The Company acknowledges the inherent uncertainties and risks associated with these factors and remains committed to addressing them proactively to ensure the continued success and growth of the organization.