Nitesh Estates Ltd Directors Report.
Your Directors present their Thirteenth Annual Report with the standalone and consolidated annual audited accounts of the Company for the year ended March 31, 2017.
1. Financial Results:
|Income from operations||7432||8712||19313||25351|
|Profit/(Loss) before depreciation||(4414)||(2039)||(8888)||(3643)|
|Less : Depreciation||70||132||1414||1418|
|Profit/(Loss) before tax||(4484)||(2171)||(10302)||(5061)|
|Less : Income tax||(19)||(34)||(14)||(9)|
|Profit / (Loss) after tax||(4465)||(2137)||(10288)||(5052)|
|Less: Minority interest & share of profit/ (loss) in Associate||0||0||0||(2220)|
No dividend has been declared for the financial year ended 31st March, 2017 as the Company has incurred loss and it is proposed to conserve the existing reserves for the projects growth and sound financial position of the Company.
3. State of Companys Affairs:
During the year under review the Company has achieved a turnover of Rs. 7,432 Lakh as against Rs. 8,712 Lakh in the previous year and other income of Rs. 20 Lakh as compared to Rs. 193 Lakh in the previous year. The operations had resulted in a loss of Rs. 4,465 Lakh as compared to previous year loss of Rs. 2,137 Lakhs.
In compliance with the applicable provisions of the Companies Act, 2013 and Regulations of the Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), and as per the applicable Accounting Standards issued by the Institute of Chartered Accountants of India the Company has prepared the Consolidated Financial Statements.
The Audited Consolidated Financial Statements along with the Auditors Report have been annexed to the Annual Report.
The total consolidated revenue for the year ended 31st March 2017 amounted to Rs. 19,527 Lakh including other income of Rs. 214 Lakh, as compared to Rs. 26,102 Lakh in the previous year. The Company has incurred a loss after tax of Rs. 10,288 Lakh a( previous years Loss Rs. 7,272 Lakh).
The audited consolidated Balance Sheet as at 31st March, 2017, consolidated Profit and Loss account for the year ended as on that date, Cash flow Statements together with the Notes and Reports of Auditors thereon forms part of the Annual Report. The financial figures have been regrouped in line with Schedule III of the Companies Act, 2013 disclosure requirements.
III. Material changes and commitments, if any, affecting the financial position of the Company occurred between the end of the financial year to which the financial statement relate and the date of the report:
a) The Company has redeemed 700 Non Convertible Debentures (Unlisted NCD)s out of 1250 Non Convertible Debentures held by IDFC Limited for the aggregate value of Rs 70 Cr.
b) The Company, being one of the promoters of Nitesh Residency Hotels Private Limited (NRHPL) had transferred 1,59,70,675 Class A Equity shares held in NRHPL to Mr. Nitesh Shetty (another promoter of NRHPL), thus, NRHPL is no longer an Associate Company as defined under Section 2 (6) of the Companies Act, 2013.
IV. Significant or material orders passed by the regulators/ courts :
During the year under review, there were no significant or material orders passed by the regulators or courts or tribunals against the Company, impacting the going concern status and Companys operations in future.
4. The Board of Directors and the Committees thereof I. Composition of the Board
The Board of the Company comprises of 8 (Eight) Directors of which four are Independent Directors. The Composition of the Board of Directors is in compliance with the applicable provisions of the Companies Act, 2013 and the Listing Regulations.
The Company has received necessary declarations from the Independent Directors stating that they meet the criteria of independence as specified in Section 149 (6) of the Companies Act, 2013 and in the Listing Regulations.
II. Change in the Board
During the year under review Mr. Sudhakar Rao (DIN: 00267211) and Mr. Ashok T Aram (DIN: 02817547) have resigned from the Board of the Company with effect from October 12, 2016 and February 7, 2017 respectively, due to their professional commitments.
Mr. L. S. Vaidyanathan (DIN:00304652), Whole time director designated as Executive Director Business Development was re-appointed for a term of 3 consecutive years with effect from 1st April, 2017, the re-appointment was approved by way of special resolution by the shareholders at a general meeting held through postal ballot on 30th March, 2017.
During the year under review, the Board met 7 (Seven) times on the following dates,
|May 28, 2016||August 9, 2016||August 25, 2016||September 28, 2016|
|November 11, 2016||February 9, 2017||March 23, 2017|
In accordance with the provisions of the Companies Act, 2013, a separate meeting of the Independent Directors of the Company was held on 23rd March, 2017.
IV. Re-appointment of Director Retiring by Rotation
In terms of Section 152 of the Companies Act, 2013, Mr. Mahesh Bhupathi (DIN: 01603093) is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment. The Board of Directors has recommended the re-appointment of Mr. Mahesh Bhupathi, as Director retiring by rotation.
V. Annual Evaluation of the Board, its Committees and Individual Directors
The Independent Directors of the Company at their separate meeting held as per the provisions of Section 149 read with Schedule V of the Companies Act, 2013 and Listing Regulations had carried out an annual evaluation of the Board, Committees and individual directors performance. The performance of the Board was evaluated after seeking inputs from the Independent Directors on the basis of criteria such as Board composition, structure, board processes and their effectiveness, information given to the Board etc.
The Board and the Nomination and Remuneration Committee (NRC) reviewed the performance of the individual directors on the basis of criteria such as their participation, contribution at the meetings, their preparedness on the agenda items to be discussed etc. Additionally the Chairman was also evaluated on key aspects of his role.
VI. Familiarization programme for Independent Directors
The Company proactively keeps its Directors informed of the activities of the Company, its management and operations and provides an overall industry perspective as well as issues being faced by the industry.
The Company also keeps the Board updated on the applicable laws, regulations, enactments etc. and any changes, amendments thereon from time to time.
5. Directors Responsibility Statement
In terms of the requirements of Section 134(5) of the Companies Act, 2013, we, on behalf of the Board of Directors, hereby state that: a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the company for that period; c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d) the directors had prepared the annual accounts on a going concern basis; and e) the directors had laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and were operating effectively. f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
6. Nomination and Remuneration Policy
The Nomination and Remuneration Committee (NRC) has formulated a policy relating to nomination of and remuneration for the Directors, Key Managerial Personnel and Senior Management personnel.
The Nomination and Remuneration policy has been prepared pursuant to the applicable provisions of the Companies Act, 2013 and Listing Agreement / Listing Regulations.
Non-Executive Directors are remunerated by way of sitting fees for attending the meetings of the Board and the Committees thereof. The sitting fees paid for Audit Committee and Board meeting is Rs. 50,000/- per meeting respectively, Nomination &
Remuneration Committee is Rs 25,000/- per meeting and Stakeholders Relationship Committee, other Committees including for a separate meeting of Independent Directors is Rs. 20,000/- per meeting respectively.
The extract of the Nomination & Remuneration Policy is reproduced in Annexure A to this report.
Remuneration Details of Directors and Employees
[Pursuant to Section 134 of the Companies Act, 2013 and the Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]
i. Ratio of remuneration of each director to the median remuneration of the employees and percentage increase in the remuneration is as follows:
|Name of the Directors||Designation||Ratio of remuneration to median remuneration of the Company||% increase in the remuneration of Directors|
|1 Mr. Nitesh Shetty||Chairman & Managing Director||21||0.0%|
|2 Mr. L. S. Vaidyanathan||Executive Director||17||0.0%|
|3 Mr. Ashwini Kumar||Executive Director & Chief Operating Officer||15||21.4%|
|4 Mr. G. N. Bajpai||Independent Director||NA||NA|
|5 Mr. Jagdish Capoor||Independent Director||NA||NA|
|6 Mr. M. D. Mallya||Independent Director||NA||NA|
|7 Mrs. Dipali Khanna||Independent Director||NA||NA|
|8 Mr. Ashok T. Aram1||Independent Director||NA||NA|
|9 Mr. Sudhakar Rao 2||Non-Independent Director||NA||NA|
|10 Mr. Mahesh Bhupathi||Non-Independent Director||NA||NA|
1. Resigned from the Board on 7th February, 2017.
2. Resigned from the Board on 12th October, 2016.
Note: i. The median remuneration of employees during the financial year was Rs. 7,61,457/- (Rupees Seven Lakh Sixty One Thousand Four hundred and Fifty Seven only)
ii. The percentage increase in the remuneration for the year ended 31st March, 2017 to the Key Managerial Personnels (other than Directors) namely, Company Secretary & Chief Compliance Officer and Chief Financial Officer is 9.5 % and 4.6% respectively.
iii. The median remuneration of employees during the financial year 2016-17 was Rs. 7,61,457/- as compared to Rs. 6,37,584/- during the previous financial year 2015-16. Hence, there is no increase in the percentage of median remuneration of employees.
iv. The number of permanent employees on the rolls of the Company as on 31st March, 2017 was 87 (the group has 279 employees).
7. Vigil Mechanism / Whistle Blower Policy
The Company has a vigil mechanism policy for its directors and employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the code of conduct/business ethics that provides for adequate safeguards against victimization of the director(s) and employee(s) who avail of the mechanism. None of the directors/employees of the Company have been denied access to the Chairman of the Audit Committee. No complaint has been received during the financial year 2016-17.
8. Corporate Social Responsibility
In terms of Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 the Company has constituted the Corporate Social Responsibility Committee and has adopted the policy for Corporate Social Responsibility. As per the provisions of Section 135 Corporate Social Responsibility contribution is not applicable for this financial year.
9. Internal Financial Controls
Based on the framework of internal financial controls and compliance systems established and maintained by the Company (with its inherent weaknesses), work performed by the internal, statutory and secretarial auditors and external consultants specially appointed for this purpose, including audit of internal financial controls over financial reporting by the statutory auditors, and the reviews performed by management and the relevant board committees, including the audit committee, the Board of the Company is of the opinion that the Companys internal financial controls were adequate and effective during the period ended as on 31st March, 2017.
10. Statutory Auditors
At the 10th Annual General Meeting of the Company held on 26th September, 2014, M/s Ray & Ray (Firm Registration Number: 301072E), the Chartered Accountants were appointed as the Statutory Auditors of the Company for an initial term of 5 (five) consecutive years which is subject to annual rati_cation by the members of the Company in terms of Section 139 of the Companies Act, 2013 read with the rules made thereunder. The Audit Committee and the Board of the Company recommends to the Members of the Company to ratify the appointment of M/s. Ray & Ray as the Statutory Auditors of the Company.
There are no qualifications or adverse remarks in the Statutory Auditors Report which require any explanation from the Board of Directors of the Company. The Statutory Auditors have expressed an unmodified opinion in their Audit Report for the
financial year ended 31st March, 2017.
11. Secretarial Auditor
M/s. Kedarnath & Associates, the Practicing Company Secretaries, were appointed as the Secretarial Auditors of the Company for the financial year 2016-17 by the Board of Directors of the Company.
The Secretarial Audit Report for the year ended 31st March, 2017 issued by the Secretarial Auditors in accordance with the provisions of Section 204 of the Companies Act, 2013 and the rules made thereunder is annexed to this report separately as
Annexure - B.
There are no qualifications or adverse remakes in the Secretarial Audit Report which requires any explanation from the Board of Directors of the Company.
12. Particulars of employees
The details of remuneration to directors, key managerial personnel and the statement of employees in receipt of remuneration exceeding the limits prescribed under Section 134 of the Companies Act, 2013 read with rules made thereunder has been provided in Annexure C to this report.
13. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo
In terms of Section 134 of the Companies Act, 2013 read with rules made thereunder, the particulars of conservation of energy, technology absorption, and foreign exchange earnings and outgo are set out in Annexure D to this report.
14. Corporate Governance
The report on Corporate Governance and a certificate from M/s. S. Kedarnath & Associates, Practicing Company Secretaries afirming the compliance with the various provisions of the Corporate Governance in terms of Regulation 27 read with Schedule V of the Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015 forms part of the Annual Report.
15. Code of Conduct
In terms of Regulation 34 read with Schedule V of the Listing Regulations, a declaration signed by Mr. Nitesh Shetty, the Chairman & Managing Director of the Company afirming compliance with the Code of Conduct by the Directors and Senior Management Personnel of the Company for the financial year 2016-17 forms part of the Corporate Governance Report.
16. Management Discussion and Analysis Report
In terms of the Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report is presented in a separate section of the Annual Report.
17. Extract of the Annual Return
In accordance with the provisions of Section 134 of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, the extract of the Annual Return in the prescribed format of MGT-9 for the financial year 2016-17 is provided in AnnexureE to this Report.
18. Particulars of Loans, Guarantees and Investments
Pursuant to the provisions of Section 134 of the Companies Act, 2013 the particulars of the loans, guarantees and investments made by the Company under Section 186 of the Companies Act, 2013 is detailed in the Notes to Accounts section of the Annual Financial Statements.
19. Related Party Transactions
During the year under review, the Company has not entered into any contract/ arrangement/ transaction with a related party which can be considered as material in terms of the policy adopted by the Company, Section 188 of the Companies Act, 2013 and the Listing Regulations on the Related Party transactions.
The related party transactions under AS 18 undertaken during the financial year 2016-17 are detailed in the Notes to Accounts section of the Annual Financial Statements.
20. Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder for prevention and redressal of complaints of sexual harassment at workplace. No complaint was received by the Management during the year.
21. Review of Subsidiaries and Associates
Pursuant to Section 129 of the Companies Act, 2013, the consolidated financial statements of the Company and its subsidiaries and associates, prepared in accordance with the relevant Accounting Standards specified under Section 133 of the Companies Act, 2013 read with the rules made thereunder, forms part of this Annual Report.
Pursuant to the provisions of the said section, a statement containing the salient features of the financial statements of the Companys subsidiaries and associates is annexed to the Consolidated Financial Statement in the prescribed format of
Further, pursuant to the provisions of Section 136 of the Companies Act, 2013, the financial statements of the Company, consolidated financial statements along with the relevant documents and separate accounts in respect of subsidiaries are available on the website of the Company.
There have been no material changes in the nature of the business of the subsidiaries (including Associate Company) during the financial year 2016-17.
In terms of the Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015, the Company has adopted a policy for determining material subsidiaries. The Policy as approved may be accessed on the Companys website at the link: http://www.niteshestates.com/Investor relations/Policies & Other Related Matters/Material Subsidiary Policy
A. Nitesh Housing Developers Private Limited (NHDPL):
NHDPL is a wholly owned subsidiary of the Company.
The financial highlights are as below:
|Paid up Capital||91,500,000||91,500,000|
|Reserves & Surplus||74,042,600||291,755,031|
|Revenue from operations||641,027,468||1,039,881,480|
|Profit/(Loss) Before Tax||(217,574,822)||28,775,217|
|Profit/(Loss) After Tax||(217,712,431)||24,413,165|
B. Nitesh Urban Development Private Limited (NUDPL):
NUDPL is a wholly owned subsidiary of the Company.
The financial highlights (Standalone) are as below:
|Paid up Capital||65,820,000||65,820,000|
|Reserves & Surplus||(13,937,382)||77,246,209|
|Income from property development||376,962,050||515,595,121|
|Profit/(Loss) Before Tax||(91,042,614)||(33,697,012)|
|Profit/(Loss) After Tax||(91,351,149)||(31,674,560)|
C. NITESH INDIRANAGAR RETAIL PRIVATE LIMITED (NIRPL):
NIRPL is a wholly owned subsidiary of the Company. The financial highlights (Standalone) are as below:
|Paid up Capital||699,100,000||699,100,000|
|Reserves & Surplus||1,048,661,394||634,777,174|
|Profit/(Loss) Before Tax||1,701,466||48,750,442|
|Profit/(Loss) After Tax||(16,178,694)||(273,901,373)|
D. NITESH PUNE MALL PRIVATE LIMITED (formerly Anuttam Developers Private Limited)
Nitesh Pune Mall Private Limited has become Tier II Subsidiary of the Company.
The financial highlights of Nitesh Pune Mall Private Limited are as follows:
|Paid up Capital||280,409,530||280,409,530|
|Reserves & Surplus||(738,118,416)||(150,290,703)|
|Income from property development||100,506,120||53,227,928|
|Profit/(Loss) Before Tax||(232,359,745)||(328,976,653)|
|Profit/(Loss) After Tax||(232,359,745)||(328,976,653)|
E. NITESH PROPERTY MANAGEMENT PRIVATE LIMITED (NPMPL):
NPMPL is a 100% wholly owned subsidiary of the Company. NPMPL is mainly into the business of maintenance contracts with the owners of completed apartments developed by the Company.
The financial highlights are:
|Paid up Capital||3,000,000||3,000,000|
|Reserves & Surplus||(30,239,008)||(6,153,964)|
|Income from operations||69,626,302||58,518,595|
|Profit/(Loss) Before Tax||(24,065,933)||(10,599,176)|
|Profit/(Loss) After Tax||(24,085,044)||(10,774,136)|
F. NITESH OFFICE PARKS PRIVATE LIMITED (Formerly Kakanad Enterprises Private Limited) :
This Subsidiary has not yet commenced its commercial operations. KEPL is a 100% subsidiary of the Company. The status of the Subsidiary:
|Paid up Capital||500,000||500,000|
|Reserves & Surplus||(1,668,115)||(1,589,180)|
|Income from operations||NIL||NIL|
|Profit/(Loss) Before Tax||(78,936)||(1,017,825)|
|Profit/(Loss) After Tax||(78,936)||(1,017,825)|
22. Additional Information to shareholders
All important and pertinent investor information such as financial results, investor presentations, press releases, project updates are made available on a regular basis on the website (www.niteshestates.com) of the Company.
Your Directors are pleased to place on record their sincere appreciation of the valuable assistance and co-operation extended to the Company by its Customers, Bankers, Financial Institutions, State and Central Government authorities, Service Providers, Contractors and the Shareholders for the Companys operations.
Your Directors also place on record their appreciation on the significant contributions made, and support extended, by the employees of the Company at all levels during the year.
|For and on behalf of the Board of Directors|
|Place: Bangalore||NITESH SHETTY|
|Date : May 27, 2017||Chairman & Managing Director|
|DIN : 00304555|