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Your Directors have pleasure in presenting the 81st Annual Report on the business and operations of Prime Urban Development I ndia Limited ["Company"] together with the Audited Accounts of the Company, for the Financial Year ended March 31,2018.
THE SUMMARIZED FINANCIAL PERFORMANCE (STANDALONE AND CONSOLIDATED) OF YOUR COMPANY FOR 2017-18 AND 2016-17 IS GIVEN Below:
Rs. in Lakhs
|Revenue from operations||9,517.57||5,266.06||9,773.14||5,688.42|
|Earnings before interest, tax, depreciation, exceptional items and amortization (EBITDA)||674.81||1,347.27||1,149.12||1,408.20|
|Less : Finance Costs||460.82||57.76||1,074.39||119.78|
|Less: Depreciation and amortization expense||32.44||32.15||35.78||36.11|
|Profit/(Loss) before Exceptional Items and Tax||181.55||1,257.36||38.95||1,252.31|
|Profit/(Loss) before Tax||(933.91)||1,257.36||(1,417.63)||1,252.31|
|Less: Tax Expense||(113.74)||(282.34)||(114.16)||(282.64)|
|Profit/(Loss) After Tax||(1,047.65)||975.02||(1,531.79)||969.67|
|Other comprehensive Income/(expenses)||(16.54)||1.46||(16.54)||1.46|
|Surplus from previous year brought forward||305.69||157.48||303.62||160.76|
|Less: Dividend and Dividend tax paid during the year||(128.27)||(128.27)||(128.27)||(128.27)|
|Un-realised gain in contra-group transfers||--||--||(2.46)||--|
|Transfer to General Reserve||--||(700.00)||--||(700.00)|
|Amount available for appropriation||(886.77)||305.69||(1,375.44)||303.62|
OVERVIEW AND THE STATE OF COMPANY AFFAIRS
During the Financial year 2017-18, your Company has clocked consolidated revenues of Rs. 4,141.32 Lakhs in the Realty segment. In the year 2017-18 your Company has sold all the balance units in Prime Enclave Vistas-Apartment Projects and handover to the Association formed by the flat owners have been completed.
Your Company has constructed 14 Villas in the Onyx Project. However looking at the current market conditions, the Company is looking to explore alternate business opportunities for the remaining land parcel. Your Company is also engaged in the sale of developed land and in the financial year 2017-18, your Company has sold in 1,43,000 sq. ft. of developed land.
Your Company is mainly focused in the Tirupur city of the state of Tamil Nadu and with the opening up of the Affordable Housing segment due to Govt. push, your Company is exploring opportunities in the same. Your Company is also aggressively seeking out opportunities in various parts of the country.
Your Company is engaged in the export of cotton yarn under Merchant Trading. The consolidated revenues from this segment in the year 2017-18 were Rs. 5,631.82 Lakhs. There were no major changes in this segment during the year.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the provisions of the Companies Act, 2013 (hereinafter referred to as the "Act") read with the Companies (Accounts) Rules, 2014, applicable Accounting Standards prescribed by the Institute of Chartered Accountants of India and the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, (hereinafter referred to as the "SEBI Listing Regulations"), the audited consolidated financial statements are provided in this Annual Report.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
As at March 31,2018, your Company had following 6 (Six) Subsidiary Companies:
1. ATL Textile Processors Limited
2. Manoj Yarn Processors Limited
3. Pee Dee Yarn Processors Limited
4. Patodia Developers Private Limited
5. Srivarsha Realtors Private Limited
6. Newline Buildtech Private Limited
During the year under review, Newline Buildtech Private Limited became a wholly owned subsidiary of the Company.
Pursuant to the provisions of Section 129(3) of the Act, a statement containing salient features of financial statements of subsidiaries, associates and joint venture companies in Form AOC 1 is attached separately to this Annual Report.
In accordance to the provisions of Section 136(1) of the Act, the Annual Report of the Company, containing therein Standalone and the Consolidated Financial Statements and the Audited Financial Statements of each of the subsidiary companies have been placed on the website of the Company - www.ptlonline.com under the Investors Section.
The Audited Financial Statements in respect of all subsidiary companies shall also be kept open for inspection at the Registered Office of the Company during working hours for a period of 21 days before the date of ensuing Annual General Meeting. The aforesaid documents relating to subsidiary companies can be made available to any Member interested in obtaining the same upon a request in that regards made to the Company.
The Policy for determining material subsidiaries as approved by the Board of Directors (hereinafter referred to as the "Board") of the Company is made available on the website of the Company at the link-http://www.ptlonline.com/ new-investors/policies/ Policy-on-Material-Subsidiaries.pdf
To conserve the funds for future business growth, your Directors have not recommended any dividend on equity shares in respect of the financial year 2017-18.
TRANSFER TO RESERVES
In view of losses incurred during the Financial Year 2017-18, no appropriation is proposed to be made towards Reserves. PUBLIC DEPOSITS
Your Company has not been accepting any deposits from the public and hence there are no unpaid/unclaimed deposits nor there is any default in repayment thereof.
MEETING OF THE BOARD MEETINGS AND ITS COMMITTEES
The Board of Directors of your Company met 6 (Six) times during the financial year 2017-18. The details of composition of the Board and its Committees, their meetings held during the year under review and the attendance of the Directors / Committee Members at the respective meetings are provided in the Corporate Governance Report which forms part of this Annual Report. The time gap between two consecutive Meetings did not exceed one hundred and twenty days.
During the year under review, the recommendations made by the Audit Committee were accepted by the Board. There were no instances where the Board has not accepted any recommendation of the Audit Committee.
PARTICULARS OF LOANS GRANTED, GUARANTEE PROVIDED AND INVESTMENTS MADE PURSUANT TO THE PROVISIONS OF SECTION 186 OF THE COMPANIES ACT, 2013
Details of loans granted, guarantees provided and investments made by the Company under the provisions of Section 186 of the Act, are provided in Note No.4(a) & 4(g) under Notes forming part of Standalone Financial Statements.
PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, EXPENDITURE ON RESEARCH AND DEVELOPMENT & FOREIGN EXCHANGE EARNINGS AND OUTGO
Considering the nature of activities in which the Company operates, energy consumption is in accordance to the normal business practices and does not require any specific installations. In its regular course of business, the Company is always vigilant to conserve the resources and continuously implements measures required to save energy.
The business activities of the Company are not specific to any technology requirements. In the course of its operations, processes are formed and implemented to achieve operational efficiencies in the Company which provide maintaining product quality and cost control.
The details in respect of Foreign Exchange earnings/outgo during the year under review, is provided in Note No. 17(3) under Notes forming part of Standalone Financial Statements.
EXTRACT OF ANNUAL RETURN
In terms of provisions of Section 92(3) of the Act, an extract of Annual Return in prescribed format is annexed to this Report as "Annexure I".
CORPORATE GOVERNANCE REPORT
Your Company is in compliance with the Corporate Governance guidelines, as laid down in the SEBI Listing Regulations. A report on Corporate Governance together with Auditors Certificate as required under Regulation 34 read with Schedule V of the SEBI Listing Regulations forms part of this Annual Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the year under review, the Board of Directors vide Circular Resolution dated April 11,2017 had appointed Mrs. Ryna Zaiwalla Karani as an Additional Director of the Company with effect from April 13, 2017. Further, the Members of the Company had at the 80th Annual General Meeting held on August 11, 2017, appointed Mrs. Ryna Zaiwalla Karani as an Independent Director of the Company for a period of five years.
In terms of the provisions of the Act, Mr. Manoj Kumar Patodia, retires from the Board of the Company by rotation at the forthcoming Annual General Meeting and being eligible, has offered himself for re-appointment.
The Board of Directors of the Company, at its Meeting held on May 21, 2018, has subject to the approval of Members, re-appointed Mr. Purusottamdas Patodia (DIN: 00032088), Mr. Manoj Kumar Patodia (DIN: 00026455) and Mr. Anuj Patodia (DIN: 00026458) as Chairman and Managing Director, Vice Chairman and Managing Director & Managing Director respectively for a period of 3 (three) years from the expiry of their present term, i.e. with effect from April 1,2019, on the terms and conditions including remuneration as recommended by Nomination and Remuneration Committee of the Board and approved by the Board.
The Board of Directors of the Company, at its Meeting held on May 21, 2018, has subject to the approval of Members, re-appointed Mr. T. Paul Sugumaran (DIN: 01875775) as Whole Time Director for a period of 3 (three) years from the expiry of his present term, i.e. with effect from June 1,2018, on the terms and conditions including remuneration as recommended by Nomination and Remuneration Committee of the Board and approved by the Board.
The Board of Directors of the Company, at its Meeting held on May 21, 2018, has subject to the approval of Members, re-appointed Mr. N. K. Bafna (DIN: 00019372), Mr. Banwarilal Singhal (DIN: 00006433) and Mr. Venkatchalam Ramaswamy (DIN: 00008509) as Independent Directors of the Company for a second term of 5 (five) consecutive years, i.e. up to March 31, 2024.
The Company has received individual declaration from following Independent Director(s) of the Company stating that they meet the criteria of independence as provided under Sub-section (6) of Section 149 of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations:
a) Mr. N. K. Bafna
b) Mr. Banwarilal Singhal
c) Mr. Venkatchalam Ramaswamy
d) Mrs. Ryna Zaiwalla Karani
The Notice convening forthcoming Annual General Meeting includes the proposal for appointment/re-appointment of aforesaid Directors. A brief resume of the Directors seeking appointment/re-appointment at the forthcoming Annual General Meeting and other details as required to be disclosed in terms of Regulation 36(3) of the SEBI Listing Regulations and Secretarial Standard on General Meeting (SS-2) forms part of the Notice calling the AGM. None of the Directors are disqualified for appointment/ re-appointment under Section 164 of the Act. None of the Directors are related inter-se to each other save and except Mr. Purusottamdas Patodia, Mr. Manoj Kumar Patodia, and Mr. Anuj Patodia. Mr. Purusottamdas Patodia is the father of Mr. Manoj Kumar Patodia, and Mr. Anuj Patodia.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 134(5) of the Act, with respect to Directors Responsibility Statement it is hereby confirmed that:
(a) in the preparation of the annual accounts for the financial year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
(b) the Directors have 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 your Company as at March 31,2018 and of the profit and loss of the Company for that period;
(c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) the Directors have prepared the annual accounts for the financial year ended March 31,2018 on a going concern basis;
(e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
(f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.
AUDITORS AND AUDITORS REPORT
M/s. L. U. Krishnan & Co, Chartered Accountants, (Firm Registration No. 001527S) were appointed as Statutory Auditors of the Company for a period of 5 (five) consecutive years at the Adjourned 80th Annual General Meeting ("AGM") held on 7th September, 2017 till the conclusion of the 85th AGM.
In terms of the provisions of Section 139 of the Companies Act, 2013, their appointment will however need to be ratified by Shareholders at the forthcoming Annual General Meeting. Notice convening the forthcoming Annual General Meeting includes a proposal for ratification of appointment of Statutory Auditors by the Shareholders of the Company.
The Auditors Report for the financial year ended March 31, 2018 does not contain any qualification, reservation or adverse remark. No instances of fraud have been reported by the Statutory Auditors of the Company under Section 143(12) of the Act.
SECRETARIAL AUDITOR AND SECRETARIAL AUDIT REPORT:
In terms of provisions of Section 204 of the Act, the Secretarial Audit of the Company for the Financial Year 2017-18 was conducted by M/s. S. K. Jain & Co, Company Secretaries in Practice.
The Secretarial Audit Report for the financial year ended March 31, 2018 is annexed to this Report as "Annexure II". The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
RELATED PARTY TRANSACTIONS
All contract/ arrangements/ transactions entered into/ by the Company during the financial year under review with related parties were on an arms length basis. There were no materially significant related party transactions entered by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons, which may have a potential conflict with interest of the Company at large.
All Related Party Transactions were placed before the Audit Committee as also the Board for approval. Prior omnibus approval of the Audit Committee was obtained for the transactions which were of a repetitive nature. The transactions entered into pursuant to the omnibus approval so granted were reviewed and statements giving details of all related party transactions were placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis. The policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is available on the website of the Company at the link i.e. http://www.ptlonline.com/new-investors/policies/Policy-on-Transactions-with-Related-Parties.pdf
The details of the related party transactions as per Accounting Standard 18 are set out in Note No.10 to the Standalone Financial Statements forming part of this report. The particulars of contracts or arrangements with aforesaid related parties, in prescribed format are annexed to this Report as "Annexure III".
RISK MANAGEMENT POLICY AND INTERNAL ADEQUACY
Pursuant to the requirement of Section 134(3)(n) of the Act, the Company has in place a structured risk management policy. The Risk management process is designed to safeguard the organisation from various risks through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks in order to minimize its impact on the business.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
In compliance with the provisions of Section 177 of the Act and Regulation 22 of the SEBI Listing Regulations, the Company has established a vigil mechanism to provide a framework for promoting responsible and secure whistle blowing and to provide a channel to the employee(s), Directors and other stakeholders to report to the management, concerns about unethical behaviour, actual or suspected fraud or violation of the code of conduct or policy/ies of the Company, as adopted/framed from time to time. The details of said vigil mechanism are given in Corporate Governance Report, which forms part of this Annual Report. The Whistle Blower Policy has been uploaded on the Companys website at the link i.e. http://www.ptlonline.com/new- investors/policies/Whistle-blower-Policy.pdf
CORPORATE SOCIAL RESPONSIBILITY
The Company has constituted a Corporate Social Responsibility Committee ("CSR Committee") in accordance with the provisions of Section 135 of the Act. The Board of Directors of the Company has, based on the recommendations made by the CSR Committee formulated and approved Corporate Social Responsibility Policy for the Company. The same is available on the website of the Company at the link http://www.ptlonline.com/new-investors/policies/Corporate-Social-Responsibility Policy.pdf
The disclosures as per Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is made in prescribed form which is annexed to this Report as "Annexure IV".
NOMINATION AND REMUNERATION POLICY
In terms of requirements prescribed under Section 178(3) of the Act, the Nomination and Remuneration Policy inter-alia providing the terms for appointment and payment of remuneration to Directors and Key Managerial Personnel is annexed to this Report as "Annexure V".
PARTICULARS OF EMPLOYEES
Disclosures with respect to the remuneration of Directors and employees as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided under "Annexure VI", which is annexed to this Report.
None of the employees of the Company were in receipt of monthly or yearly remuneration in excess of the limits specified under the Act and Rule 5(2) & Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion & Analysis Report as required under Regulation 34 of the SEBI Listing Regulations is annexed to this Report as "Annexure VII".
INTERNAL FINANCIAL CONTROLS
Your Company has put in place adequate policies and procedures to ensure that the system of internal financial control is commensurate with the size and nature of the Companys business. A regular audit and review processes ensure that the controls are reinforced on an ongoing basis. Such controls have been assessed during the year taking into consideration the essential components of internal financial controls. Based on the assessment carried out by the Company, the internal financial controls were adequate and effective and no reportable material weakness or significant deficiencies in the design or operation of internal financial controls were observed, during the year ended March 31,2018.
UNCLAIMED AND UNPAID DIVIDENDS
As on March 31, 2018, amounts of Rs. 3,90,445/- and Rs. 3,78,611/- are lying in the unpaid equity dividend account of the Company in respect of the dividend for the Financial Year 2015-16 and 2016-17 respectively. Members who have not yet received/claimed their dividend entitlements are requested to contact the Company or the Registrar and Share Transfer Agents of the Company.
MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the Financial Statements relate and the date of this Report.
Pursuant to the provisions of Sections 134(3)(p), 149(8) and Schedule IV of the Act and Regulation 17(10) of SEBI Listing Regulations and in accordance with the Guidance Note on Board Evaluation issued by Securities and Exchange Board of India, the Directors have carried out the annual performance evaluation of the Board, Independent Directors, Non-executive Directors, Executive Directors, Committees and the Chairman of the Board. The performance was evaluated based on inputs received from all the directors after considering criteria such as Board composition and structure, effectiveness of Board / Committee processes, and information provided to the Board, etc. A separate meeting of the Independent Directors was also held during the year for the evaluation of the performance of non-independent Directors, performance of the Board as a whole and that of the Chairman.
The details of programme for familiarisation of Independent Directors with the Company, industry in which it operates, their roles, rights, responsibilities is made available on the website of the Company at the link- www.ptlonline.com .
1) The Company has not issued any equity shares with differential rights as to dividend, voting or otherwise.
2) The Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Board and General Meeting.
3) The Whole Time Director has not received any commission from the Company nor any remuneration or commission from any of its subsidiary company.
4) There are no significant/material orders passed by the regulators/courts/tribunals during the year under review which would impact the going concern status of your Company and its future operations.
5) During the year under review, there were no reported instances of cases filed pursuant to Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
Your Directors would like to thank and place on record their appreciation for the support and co-operation provided to your Company by its Shareholders, regulatory authorities and its bankers.
Your Directors would also like to place on record their appreciation for the efforts put in by employees of the Company during the year.
For and on behalf of the Board
Chairman and Managing Director
Place : Mumbai
Date : May 21,2018