Oberoi Realty Ltd Directors Report.

To

The Members, Oberoi Realty Limited

Your Directors have pleasure in presenting the 23rd Annual Report of the Company on the business and operations of the Company, together with the Audited Financial Statements for the year ended March 31, 2021.

Financial Results

The Companys performance during the financial year ended March 31, 2021 as compared to the previous financial year is summarized below: (Rs in Lakh)

Particulars CONSOLIDATED STANDALONE
2020-21 2019-20 2020-21 2019-20
Revenue from operations 2,05,257.95 2,23,763.29 84,967.39 61,966.20
Other income 3,800.70 4,835.22 5,148.73 12,419.52
Total revenue 2,09,058.65 2,28,598.51 90,116.12 74,385.72
Expenses 1,16,941.12 1,32,300.16 39,264.84 32,494.49
Profit before share of profit of joint venture (net) 92,117.53 96,298.35 50,851.28 41,891.23
Share of Profit/(Loss) of joint ventures (net) 324.95 590.88 - -
Profit before tax 92,442.48 96,889.23 50,851.28 41,891.23
Tax expenses 18,513.30 27,956.21 9,189.74 10,406.89
Other comprehensive income (net of tax) 225.04 (14.02) 166.49 (14.40)
Total comprehensive income for the year 74,154.22 68,919.00 41,828.03 31,469.94

NATURE OF BUSINESS

The Company is primarily engaged in the activities of Real Estate Development. The Company develops residential, commercial, retail and social infrastructure projects. There was no change in nature of the business of the Company, during the year under review.

FINANCIAL PERFORMANCE Consolidated Financials

During the year under review, your Companys consolidated total revenue stood at Rs 2,09,058.65 lakh as compared to Rs 2,28,598.51 lakh for the previous year, representing a decrease of 8.55%; profit before tax stood at Rs 92,442.48 lakh for the year under review as compared to Rs 96,889.23 lakh for the previous year representing a decrease of 4.59%; and the total comprehensive income stood at Rs 74,154.22 lakh as compared to Rs 68,919.00 lakh for the previous year representing an increase of 7.60%.

Standalone Financials

During the year under review, the total revenue stood at

Rs 90,116.12 lakh as compared to Rs 74,385.72 lakh for the previous year representing an increase of 21.15%; profit before tax stood at Rs 50,851.28 lakh for the year under review as compared to Rs 41,891.23 lakh for the previous year representing an increase of 21.39%; and the total comprehensive income stood at Rs 41,828.03 lakh as compared to Rs 31,469.94 lakh for the previous year representing an increase of 32.91%.

REPORT ON PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES

The performance and financial position of each of the subsidiaries, associates and joint venture companies for the year ended March 31, 2021 is attached to the financial statements hereto.

During the year under review Homexchange Limited was incorporated as a joint venture of Company. Save and except the same, no company has become or ceased as a subsidiary, associate, or joint venture of your Company during the year under review.

TRANSFER TO RESERVES

It is not proposed to transfer any amount to reserves out of the profits earned during FY 2020-21.

DIVIDEND

With a view to conserve resources, the Directors do not recommend any dividend for the year ended March 31, 2021 (previous year: Nil).

DEPOSITS

During the year under review, your Company neither accepted any deposits nor there were any amounts outstanding at the beginning of the year which were classified as ‘Deposits in terms of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposit) Rules, 2014 and hence, the requirement for furnishing of details of deposits which are not in compliance with the Chapter V of the Companies Act, 2013 is not applicable.

DISCLOSURES UNDER SECTION 134(3)(L) OF THE COMPANIES ACT, 2013

Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Companys financial position, have occurred between the end of the financial year of the Company and date of this report.

INTERNAL FINANCIAL CONTROLS

The Internal Financial Controls with reference to financial statements as designed and implemented by the Company are adequate. During the year under review, no material or serious observation has been received from the Statutory Auditors and the Internal Auditors of the Company on the inefficiency or inadequacy of such controls.

INTERNAL CONTROL SYSTEMS

Adequate internal control systems commensurate with the nature of the Companys business, size and complexity of its operations are in place and have been operating satisfactorily. Internal control systems comprising of policies and procedures are designed to ensure reliability of financial reporting, timely feedback on achievement of operational and strategic goals, compliance with policies, procedure, applicable laws and regulations. Internal control systems are designed to ensure that all assets and resources are acquired economically, used efficiently and adequately protected.

DISCLOSURE OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL

No significant and material orders have been passed by any Regulator or Court or Tribunal which can have impact on the going concern status and the Companys operations in future.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All the transactions/contracts/arrangements of the nature as specified in Section 188(1) of the Companies Act, 2013 entered by the Company during the year under review with related party(ies) are in ordinary course of business and on arms length. Further none of such transactions/contracts/ arrangements are material (i.e., satisfying the criteria provided in first proviso of section 188(1) of the Companies Act, 2013) in nature. Hence, no particulars in form AOC-2 are furnished.

Kindly refer the financial statements for the transactions with related parties entered during the year under review.

PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS UNDER SECTION 186

Kindly refer the financial statements for the loans, guarantees and investments given/made by the Company as on March 31, 2021.

UTILIZATION OF PROCEEDS OF NON-CONVERTIBLE DEBENTURES

During the year under review, an aggregate amount of

Rs 69,800 lakh was raised by way of issue of listed, secured, rated, redeemable, non-convertible debentures on private placement basis. The entire Issue proceeds were utilised towards the objects of the Issue during the year under review. Kindly refer the report on Corporate Governance for the utilization of the said proceeds.

DISCLOSURE RELATING TO EQUITY SHARES WITH DIFFERENTIAL RIGHTS

The Company has not issued any equity shares with differential rights during the year under review and hence no information as per provisions of Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

DISCLOSURE RELATING TO SWEAT EQUITY SHARES

The Company has not issued any sweat equity shares during the year under review and hence no information as per provisions of Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

DISCLOSURE RELATING TO EMPLOYEE STOCK OPTION SCHEME AND EMPLOYEE STOCK PURCHASE SCHEME

During the year under review the Nomination, Remuneration, Compensation and Management Development Committee of the Directors (“Committee”), and the Board of Directors approved the introduction and implementation of ‘ORL Employee Stock Option Plan 2020 (“ESOP 2020”). ESOP 2020 was approved by the members of the Company at the Annual General Meeting held on September 28, 2020. The Company had during the year under review made grant of an aggregate of 15,30,378 options under ESOP 2020 to class of employees as determined by the Committee. However, all of the said options stands cancelled for want of acceptance by the options grantees within the stipulated time.

Hence there are no outstanding options under ESOP 2020 as on March 31, 2021.

Accordingly, no disclosures in terms of Companies (Share Capital and Debenture) Rules, 2014 and SEBI (Employee Share Based Employee Benefits) Regulations, 2014 are required.

DISCLOSURES IN RESPECT OF VOTING RIGHTS NOT DIRECTLY EXERCISED BY EMPLOYEES

There are no shares held by trustees for the benefit of employees and hence no disclosure under Rule 16(4) of the Companies (Share Capital and Debentures) Rules, 2014 has been furnished.

MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL

Board of Directors and Key Managerial Personnel

There was no change in the composition of Board of Directors and the Key Managerial Personnel during the year under review.

Ms. Bindu Oberoi is liable to retire by rotation at the 23rd Annual General Meeting in terms of Section 152 read with Section 149(13) of the Companies Act, 2013, and the said Director has offered herself for reappointment. The resolution for her reappointment is incorporated in the Notice of the ensuing Annual General Meeting, and the brief profile and other information as required under Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”) relating to her forms part of the Notice of ensuing Annual General Meeting.

Declarations by Independent Directors

Pursuant to the provisions of sub-section (7) of Section 149 of the Companies Act, 2013, the Company has received individual declarations from all the Independent Directors confirming that they fulfill the criteria of independence as specified in Section 149(6) of the Companies Act, 2013. In view of the available time limit, those Independent Directors who are required to undertake the online proficiency self-assessment test as contemplated under Rule 6(4) of the Companies (Appointment and Qualification of Directors) Rules, 2014, are yet to undertake such test.

DISCLOSURES RELATED TO BOARD, COMMITTEES AND POLICIES

Board Meetings

The Board of Directors met 4 times during the financial year ended March 31, 2021 in accordance with the provisions of the Companies Act, 2013 and rules made there under. All the Directors actively participated in the meetings and provided their valuable inputs on the matters brought before the Board of Directors from time to time. Additionally, on March 6, 2021, the Independent Directors held a separate meeting in compliance with the requirements of Schedule IV of the Companies Act, 2013 and the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Directors Responsibility Statement

In terms of Section 134(5) of the Companies Act, 2013, in relation to the audited financial statements of the Company for the year ended March 31, 2021, the Board of Directors hereby confirms that:

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanations relating to material departures, wherever applicable;

(b) such accounting policies have been selected and applied consistently and the Directors made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2021 and of the profits of the Company for the year ended on that date;

(c) proper and sufficient care was 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;

(d) the annual accounts of the Company have been prepared on a going concern basis;

(e) internal financial controls have been laid down to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

(f) proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Nomination and Remuneration Committee

A Nomination and Remuneration Committee is in existence in accordance with the provisions of sub-section (1) of Section 178 of the Companies Act, 2013. Kindly refer section on Corporate Governance, under head ‘Nomination, Remuneration, Compensation and Management Development Committee for matters relating to constitution, meetings, functions of the Committee; and the remuneration policy formulated by this Committee.

Audit Committee

An Audit Committee is in existence in accordance with the provisions of Section 177 of the Companies Act, 2013. Kindly refer section on Corporate Governance, under head ‘Audit Committee for matters relating to constitution, meetings and functions of this Committee.

Corporate Social Responsibility Committee

As per the provisions of Section 135 of the Companies Act, 2013, a Corporate Social Responsibility (CSR) Committee constituted by the Board of Directors exists.

For details of the composition of the Committee, the CSR policy and other relevant details that are required to be disclosed under the provisions of Section 134(3)(o) of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014, kindly refer Annexure I attached herewith and which forms part of this report.

NCD Committee

To undertake necessary activities in connection with the non-convertible debentures aggregating to Rs 69,800.00 lakh issued during FY 2020-21, a NCD Committee was constituted by the Board of Directors, comprising of Mr. Vikas Oberoi, Ms. Bindu Oberoi and Mr. Saumil Daru. During FY 2020-21, the Committee met 7 times on September 24, 2020, September 25, 2020, September 28, 2020 (twice), October 1, 2020, December 11, 2020, and March 9, 2021, which were attended by Mr. Vikas Oberoi and Mr. Saumil Daru.

Other Board Committees

For details of other board committees, kindly refer the section on Corporate Governance.

Vigil Mechanism for the Directors and Employees

In compliance with the provisions of Section 177(9) of the Companies Act, 2013, the Board of Directors of the Company has framed the “Whistle Blower Policy” as the vigil mechanism for Directors and employees of the Company.

The Whistle Blower Policy is disclosed on the website of Company at https://www.oberoirealty.com/pdf/Whistle_Blower_Policy.pdf

Fraud Reporting

During the year under review, no instances of fraud were reported by the Auditors of the Company.

Risk Management Policy

The Board of Directors of the Company has put in place a Risk Management Policy which aims at enhancing shareholders value and providing an optimum risk-reward tradeoff. The risk management approach is based on a clear understanding of the variety of risks that the organization faces, disciplined risk monitoring and measurement and continuous risk assessment and mitigation measures.

Annual Evaluation of Directors, Committee and Board

The Nomination and Remuneration Committee of the Board has formulated a Performance Evaluation Framework, under which the Committee has identified criteria upon which every Director, every Committee, and the Board as a whole shall be evaluated. During the year under review the evaluation of every Director, every Committee, and the Board had been carried out.

Particulars of Employees and Remuneration

The information as required under the provisions of Section 197(12) of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are set out in Annexure II attached herewith and which forms part of this report.

Payment of remuneration/commission to Executive Directors from holding or subsidiary companies

None of the Managing Director, and the Whole Time Director of the Company are in receipt of remuneration/commission from any subsidiary company of the Company. The Company has no holding company.

AUDITORS AND THEIR REPORTS

The matters related to Auditors and their Reports are as under:

Observation of statutory auditors on financial statements for the year ended March 31, 2021

The auditors report does not contain any qualification, reservation or adverse remark or disclaimer or modified opinion.

Secretarial Audit report for the year ended March 31, 2021

As required under provisions of Section 204 of the Companies Act, 2013 and pursuant to Regulation 24A of Listing Regulations, the reports in respect of the Secretarial Audit for FY 2020-21 carried out by M/s. Rathi and Associates, Company Secretaries, in Form MR-3 forms part to this report. Also, the Secretarial Audit Reports for FY 2020-21 in Form MR-3 in respect of Oberoi Constructions Limited, and Incline Realty Private Limited, the material unlisted subsidiaries of your Company, forms part of this report. The said reports does not contain any adverse observation or qualification or modified opinion.

Statutory Auditors appointment

Pursuant to the provisions of Section 139 of Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, as amended, S R B C & Co LLP, Chartered Accountants, the Statutory Auditors of the Company, hold office upto the conclusion of 24th Annual General Meeting.

Though not mandatory, as a good governance practice, a business for the ratification of the appointment of the said Statutory Auditors has been included in the notice of 23rd Annual General Meeting.

Cost Auditors

In respect of FY 2020-21, your Company is required to maintain cost records as specified by the Central Government under section 148(1) of the Companies Act, 2013 for the Construction industry, and accordingly such accounts and records are made and maintained by your Company.

The said cost accounts and records are also required to be audited pursuant to the provisions of Section 148 of the Companies Act, 2013, read with notifications/circulars issued by the Ministry of Corporate Affairs from time to time, and accordingly as per the recommendation of the Audit Committee, the Board of Directors at its meeting held on July 14, 2020, appointed M/s. Kishore Bhatia & Associates, Cost Accountants, as the Cost Auditors of the Company for FY 2020-21.

In respect of FY 2021-22, the Board based on the recommendation of the Audit Committee has approved the appointment of M/s. Kishore Bhatia & Associates, Cost Accountants, as the cost auditors of the Company. A resolution for ratification of the remuneration to be paid for such appointment is included in the notice of the ensuing Annual General Meeting.

OTHER DISCLOSURES

Other disclosures as per provisions of Section 134 of the Act read with Companies (Accounts) Rules, 2014 are furnished as under:

Annual Return

Pursuant to the provisions of Section 134(3)(a) of the Companies Act, 2013, the Annual Return for the financial year ended March 31, 2021 is available on the website of the Company at www.oberoirealty.com, under the section ‘Investor Corner, ‘Notices/Others.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

The particulars as required under the provisions of Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 in respect of conservation of energy and technology absorption have not been furnished considering the nature of activities undertaken by the Company during the year under review.

The details of foreign exchange earnings and outgo during the year under review is as under:

Value of Imports (on C. I. F. Basis)

 

(Rs in Lakh)
Particulars 2020-21 2019-20
Materials 8.57 6.88
Capital Goods 41.94 173.65

Expenditure in Foreign currency (on payment basis)

(Rs in Lakh)

Particulars 2020-21 2019-20
Foreign Travel 0.13 275.72
Professional Fees 132.85 1,013.94
Others 106.93 1,174.09

Earnings in Foreign currency (on receipts basis)

(Rs in Lakh)
Particulars 2020-21 2019-20
Sale of residential units 70.70 -
Hospitality services 97.49 5,297.19

Compliance with Secretarial Standards

The Company is in compliance with the mandatory Secretarial Standards.

Unclaimed and Unpaid Dividends, and transfer of shares to IEPF

Kindly refer section on Corporate Governance, under head ‘Unclaimed and Unpaid Dividends, and transfer of Shares to IEPF for the amounts of unclaimed and unpaid dividends lying with the Company.

Members who have not yet received/claimed their dividend entitlements are requested to contact the Company or the Registrar and Transfer Agent of the Company.

Pursuant to Section 124 of the Companies Act, 2013 read with the Investor Education Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (“Rules”), all dividends remaining unpaid or unclaimed for a period of 7 years and also the shares in respect of which the dividend has not been claimed by the shareholders for 7 consecutive years or more are required to be transferred to Investor Education Protection Fund (IEPF) in accordance with the procedure prescribed in the Rules. Accordingly, during FY 2020-21, the Company has transferred to IEPF the unclaimed and unpaid dividend pertaining to FY 2012-13 of Rs 37,976. Further, during FY 2020-21, 158 shares were transferred to IEPF authority as dividend in respect of those shares had not been claimed by the shareholders for 7 consecutive years. The details of the shares so transferred are available on the website of Company. Members can claim from IEPF their dividend entitlements and/or shares transferred to IEPF by following the required procedure.

Service of documents through electronic means

Subject to the applicable provisions of the Companies Act, 2013, and applicable law, all documents, including the Notice and Annual Report shall be sent through electronic transmission in respect of members whose email IDs are registered in their demat account or are otherwise provided by the members.

Internal Complaint Committee

The Company has complied with the provisions relating to the constitution of Internal Complaint Committee (“ICC) as required under The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 [14 of 2013].

Separate ICC exists for the real estate division as well as the hospitality division ‘Westin Mumbai Garden City. The Company is strongly opposed to sexual harassment and employees are made aware about the consequences of such acts and about the constitution of ICC.

Neither were any complaints filed during FY 2020-21 under the provisions of the said Act, nor were any complaints outstanding as at the beginning and end of the year under review.

Corporate Governance

The report on Corporate Governance and also the report of the Statutory Auditors regarding compliance with the conditions of Corporate Governance have been furnished in the Annual Report and forms a part of the Annual Report.

Management Discussion and Analysis Report

The Management Discussion and Analysis report has been separately furnished in the Annual Report and forms a part of the Annual Report.

Business Responsibility Reporting

In compliance with the Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with SEBI circular dated December 27, 2015, the Business Responsibility Report for the financial year ended March 31, 2021 has been separately furnished in the Annual Report and forms a part of the Annual Report.

Dividend Distribution Policy

In compliance with the Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015,the Dividend Distribution Policy formulated by the Company is available on the website of the Company https://www.oberoirealty.com/pdf/Dividend-Distribution-Policy.pdf

ACKNOWLEDGEMENTS AND APPRECIATION:

Your Directors take this opportunity to thank the employees, customers, suppliers, bankers, business partners/associates, financial institutions and various regulatory authorities for their consistent support/encouragement to the Company.

Your Directors would also like to thank the Members for reposing their confidence and faith in the Company and its Management.

For and on behalf of the Board of Directors

Vikas Oberoi

Chairman & Managing Director

DIN: 00011701

Mumbai, May 14, 2021