Sea Gold Infrastructure Ltd Directors Report.

To

The Members

Sea Gold Infrastructure Limited

Your Directors have pleasure in presenting their 23rd Annual Report on the business and operations of your company with the Audited Statement of Accounts for the Financial Year ended March 31, 2017.

FINANCIAL RESULTS

The standalone financial performance of the Company for the financial year ended March 31, 2016 is summarized below:

STANDALONE (Rs in Crores)
Particulars 2016-17 2015-16
Revenue from operations 10,03,580 2,75,29,336
Other Income 24,773 12,229
Total Income 10,28,353 2,75,41,565
Total Expenditure 63,89,432 2,85,86,915
Depreciation 33,042 32,633
Profit / (Loss) before exceptional and extraordinary items and tax (53,94,121) (10,77,983)
Less: exceptional and extraordinary items Nil Nil
Profit / (Loss) before taxation (53,94,121) (10,77,983)
Less: - Current Tax Nil Nil
- Income Tax (Earlier years) Nil Nil
- Deferred Tax 477 6671
Profit/(Loss) after Tax (53,94,598) (10,84,654)
Earnings per equity shares in Rs. (0.99) (0.20)

OPERATIONS:

During the year under review, the gross revenue of the Company decreased to Rs.10,03,580 compared to Rs.2,75,29,336 in the previous year. The Profit after tax for the year decreased to Rs. (53,94,598) compared to (10,84,654) in the previous year.

REVIEW OF PERFORMANCE AND STATE OF THE COMPANYS AFFAIRS

During the year under review, operations were well carried out by the Company with increased capacity utilization, turnover should improve further. There is strong belief that this business improvement will sustain in the future too. Scenario for future opportunities is bright.

CHANGE IN THE NATURE OF BUSINESS, IF ANY:

There is no change in the nature of business during the year.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, 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 THE REPORT

There are no other Material Changes and Commitments affecting the financial position of the Company which occurred between the end of the financial year to which the financial statements relate and the date of this Report.

DIVIDEND AND TRANSFER TO RESERVES

The Board of Directors of your Company has decided to retain and plough back the profits into the business of the Company, thus no dividend is being recommended for this year.

There were no transfers to Reserves during the financial year 2016-17.

SHARE CAPITAL

During the period under review, there has no change in the Share Capital of the Company. The Authorized Share Capital of the Company is Rs.5,50,00,000 divided into 55,00,000 equity shares of Rs.10/- (Rupees Ten) each.

The Issued, Subscribed and Paid up Capital of the Company as on March 31, 2017 is Rs.5,44,824,00 divided into 54,48,240 equity shares of Rs. 10 (Rupees Ten) each.

The Company has not issued any shares with differential rights and hence no information as per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board of directors of your company is duly constituted.

Proposed Appointments:

The following appointments to the Board are proposed:

Approval of the shareholders is being sought for the appointment of Mr. Sathaiah Bathula (DIN 07277786) as a Director of the Company, who retire by rotation at the ensuing Annual General Meeting of the Company and being eligible offer herself for re-appointment in accordance with the provisions of the Companies Act and pursuant to Articles of Association of the Company. Your Board recommends her re- appointment.

Appropriate resolutions for the appointment/ re-appointment of Directors are being placed before you for your approval at the ensuing Annual General Meeting. The brief resume of the aforesaid Directors and other information have been detailed in the Notice. Your Directors recommend their appointment/reappointment as Directors of your Company.

NUMBER OF MEETINGS OF THE BOARD:

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year Five (5) Board Meetings were convened and held. The gap between any two Board Meetings is within the period as prescribed under the Companies Act, 2013 and Listing Agreement.

Dates on which the Board Meeting were held

S.No. Date of Board Meeting
1 28.05.2016
2 13.08.2016
3 14.11.2016
4 14.02.2017
5 21.03.2017

The Attendance of Directors at these Board Meetings is as under:

Name of Directors No. of meetings held during the tenure of the Director No. of meetings attended by the Director Whether present at the previous AGM
Mr. Venkata Krishna Reddy Panati 5 5 Yes
Mr. Venkata Satish Veerapaneni 5 5 Yes
Mr. Rajasekhar Mathuru Reddy 5 5 Yes
Mr. Syed Khaleel Ahmed 5 5 Yes
Mrs. Vijayalakshmi Panati 5 5 Yes
Mr. Sathaiah Bathula 5 5 No

DECLARATIONS BY INDEPENDENT DIRECTORS:

The Company has received declarations form the Independent Directors under Section 149(6) of the Companies Act, 2013 confirming their independence vis--vis the Company.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company shall through its Senior Managerial personnel familiarise the Independent Directors with the strategy, operations and functions of the Company. The Independent Directors will also be familiarised with their roles, rights and responsibilities and orientation on Statutory Compliances as a Board Member.

On appointment of the Independent Directors, they will be asked to get familiarised about the Companys operations and businesses. An Interaction with the key executives of the Company is also facilitated to make them more familiar with the operations carried by the company. Detailed presentations on the business of the company are also made to the Directors. Direct meetings with the Chairman and the Managing Director are further facilitated for the new appointee to familiarize him/her about the Company/its businesses and the group practices as the case may be and link is available at the website www.seagoldaqua.com.

REMUNERATION POLICY

The Companys remuneration policy is driven by the success and performance of the individual employee and the Company. Through its compensation programme, the Company endeavours to attract, retain, develop and motivate a high performance workforce. The Company follows a compensation mix of fixed pay, benefits and performance based variable pay. Individual performance pay is determined by business performance and the performance of the individuals measured through the annual appraisal process.

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration including criteria for determining qualifications, positive attributes and independence of a director. The Remuneration Policy is available on the website of the Company viz. www.seagoldaqua.com

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 134 (3) and (5) of the Companies Act 2013, with respect to Directors Responsibility Statement, your board of directors to the best of their knowledge and ability confirm that:

a. in the preparation of the annual accounts for the financial year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b. the accounting policies mentioned in notes to Financial Statements have been selected and applied consistently and the Directors 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 as at 31st March, 2017 and of the profit/loss of the Company for that year;

c. proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. the annual financial statements of the Company have been prepared on a ‘going concern basis;

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

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.

CONSTITUTION OF AUDIT COMMITTEE

The Audit Committee of the Company is duly constituted as per Section 177 of the Companies Act, 2013. During the year four (4) Audit Committee Meetings were convened and held as follows:

Dates on which the Audit Committee Meetings were held

Sl. No. Date of Board Meeting
1 28.05.2016
2 13.08.2016
3 14.11.2016
4 14.02.2017
5 21.03.2017

The members of Audit Committee are:

Mr. Veerapaneni Venkata Satish Chairman
Mr. Syed Khaleel Ahmed Member
Mr. Sathaiah Bathula Member

NOMINATION AND REMUNERATION COMMITTEE:

The Company had constituted the Nomination and Remuneration Committee under section 178 of the Companies Act, 2013. The Nomination and Remuneration policy is annexed to this report.

(a)Composition, Meetings and Attendance during the year

The Nomination and remuneration committee comprises of total three Non-Executive cum Independent directors.

The committee comprises as follows:

Directors Chairman/Member Category
Mr. Veerapaneni Venkata Satish Chairman Independent and Non-Executive Director
Mr. Syed Khaleel Ahmed Member Independent and Non-Executive Director
Mr. Sathaiah Bathula Member Independent and Non-Executive Director

(b) Selection and Evaluation of Directors:

The company believes formal evaluation of the board and of the individual directors, on an annual basis, is a potentially effective way to respond to the demand for greater board accountability and effectiveness. For the company, evaluation provides an ongoing means for directors to assess their individual and collective performance and effectiveness. In addition to greater board accountability, evaluation of board members helps in;

a. More effective board process

b. Better collaboration and communication

c. Greater clarity with regard to members roles and responsibilities

d. Improved chairman managing directors and board relations

The evaluation process covers the following aspects

- Self evaluation of directors

- Evaluation of the performance and effectiveness of the board

- Evaluation of the performance and effectiveness of the committees

- Feedback from the non executive directors to the chairman

- Feedback on management support to the board.

(c) Performance Evaluation of Board, Committees and Directors

The company believes formal evaluation of the board and of the individual directors, on an annual basis, is a potentially effective way to respond to the demand for greater board accountability and effectiveness. For the company, evaluation provides an ongoing means for directors to assess their individual and collective performance and effectiveness. In addition to greater board accountability, evaluation of board members helps in;

a. More effective board process

b. Better collaboration and communication

c. Greater clarity with regard to members roles and responsibilities

d. Improved chairman managing directors and board relations

The evaluation process covers the following aspects

- Self evaluation of directors

- Evaluation of the performance and effectiveness of the board

- Evaluation of the performance and effectiveness of the committees

- Feedback from the non executive directors to the chairman

- Feedback on management support to the board.

CORPORATE GOVERNANCE

As per Regulation 15 of SEBI (Listing Obligations and Disclosure Requirements), 2015, provisions relating to corporate governance are not applicable to your company and therefore, no separate report on corporate governance is required

MANAGEMENT DISCUSSION & ANALYSIS

The Management Discussion and Analysis Report highlighting the industry structure and developments, opportunities and threats, future outlook, risks and concerns etc. is forms part of this report and the same is annexed herewith.

STATUTORY AUDITORS

M/s. A.G.V. Reddy & Co, Chartered Accountants, Hyderabad, were appointed as Statutory Auditors of the Company to fill the casual vacancy caused by resignation of M/S.G.C Reddy & Associates for the Financial Year 2016-17. The statutory auditors have also confirmed their eligibility under section 139(1) of the Companies Act, 2013. Members are requested to ratify their appointment as Statutory Auditors for financial year 2016-2017 & 2017-2018 and to authorize the Board to fix their remuneration.

REPLIES TO AUDITORS REPORT

The Auditors Report does not contain any qualification. Notes to Accounts and Auditors remarks in their report are self-explanatory and do not call for any further comments.

BUSINESS RESPONSIBILITY REPORT (BRR)

Securities Exchange Board of India (SEBI) vide circular CIR/CFD/DIL/8/2012 dated August 13, 2012 has mandated the inclusion of BRR as part of the Annual Report for the top 100 listed entities based on their market capitalization on Bombay Stock Exchange Ltd and National Stock Exchange of India Ltd as at 31 March 2012. In view of the requirements specified, the company is not mandated for the providing the BRR and hence do not form part of this Report.

SECRETARIAL AUDIT REPORT

In terms of Section 204 of the Act and Rules made there under, Mr. Manoj Kumar Koyalkar, M/s. AGR Reddy & Co, Practicing Company Secretary has been appointed as Secretarial Auditor of the Company. The report of the Secretarial Auditor is enclosed as Annexure - III to this report. The report is self-explanatory and do not call for any further comments

QUALIFICATION

As per the Secretarial Audit Report, during the year the Company has not appointed Company Secretary and Chief Financial Officer.

MANAGEMENTS REPLY

The Company at present is not carrying out any operations and thus was unable to appoint Chief Financial Officer and Company Secretary.

COST AUDITORS

The provisions of Section 148 of the Companies Act, 2013 relating to mandatory Cost Audit does not apply to the Company and hence, no Cost Audit is conducted. However, the Company is required to maintain Cost records which the Company is maintaining.

CORPORATE SOCIAL RESPONSIBILITY

The provisions w.r.t. CSR is not applicable to the Company. Therefore, the Company had not constituted CSR committee during the year 2016-17.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Details of loans and guarantees given and investments made under Section 186 of the Act are provided in the Notes to the Financial Statements.

WHISTLE BLOWER POLICY/VIGIL MECHANISM

Pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013 and the rules framed there under and pursuant to the applicable provision of Clause 49 of the listing agreement entered with stock exchanges, the company has established a mechanism through which all stake holders can report the suspected frauds and genuine grievances to the appropriate authority. The Whistle blower policy which has been approved by the board of directors of the company has been hosted on the website of the company viz., www.seagoldaqua.com

PREVENTION OF INSIDER TRADING

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Companys shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The ‘Manager is responsible for implementation of the Code along with the management of the Company.

Members of the Board have confirmed compliance with the Code.

RISK MANAGEMENT POLICY

The Board of Directors has formed a risk management committee to identify, evaluate, mitigate and monitor the risks associated with the business carried by the company. The committee reviews the risk management plan and ensures its effectiveness. A mechanism has been put in place which will be reviewed on regular intervals.

POLICY ON SEXUAL HARASSMENT

The Company has adopted policy on Prevention of Sexual Harassment of Women at Workplace in accordance with The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the financial year ended 31st March, 2017, the Company has not received any complaints pertaining to Sexual Harassment.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All the related party transactions that were entered during the financial years were in the ordinary course of business of the company and were on arm length basis. There were no materially significant related party transactions entered by the company during the year with the promoters, directors, key managerial personnel or other persons which may have a potential conflict with the interest of the company.

The policy on related party transactions as approved by the board of directors is hosted on the website of the company viz., www.seagoldaqua.com

Particulars of every contract or arrangements entered into by the Company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto shall be disclosed in Form No. AOC-2 as ‘Annexure I to this report

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

No significant and material order has been passed by the regulators, courts, tribunals impacting the going concern status and Companys operations in future.

PUBLIC DEPOSITS

Your Company has not accepted any deposits from the public under Chapter V of the Act or under the corresponding provisions of Section 73 and 74 of the Companies Act, 2013. As such, there was no principal or interest outstanding on the date of the Balance Sheet.

PARTICULARS OF EMPLOYEES

A table containing the particulars in accordance with the provisions of Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is appended as ‘Annexure II to this Report. In terms of Section 136 of the Companies Act, 2013 the same is open for inspection at the Registered Office of the Company.

Copies of this statement may be obtained by the members by writing to the Company Secretary at the Registered Office of the Company. The ratio of the remuneration of each Director to the median employees remuneration and other details in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are enclosed in ‘Annexure III and forms part of this Report.

EXTRACT OF THE ANNUAL RETURN

In accordance with Section 134 (3) (a) of the Act, an extract of the Annual Return in the prescribed format is appended as ‘Annexure IV to this Report.

DETAILS OF SUBSIDIARY, JOINT VENTURE OR ASSOCIATE COMPANIES

The Company does not have any Subsidiary, Joint Venture or an Associate Company.

PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

(A) CONSERVATION OF ENERGY

(i) the steps taken or impact on conservation of energy Nil
(ii) the steps taken by the company for utilizing alternate sources of energy Nil
(iii) the capital investment on energy conservation equipments Nil

(B) TECHNOLOGY ABSORPTION

(i) the efforts made towards technology absorption The Company has neither absorbed nor adopted any new technology. The company has also not made any innovation in technology other than the R&D
(ii) the benefits derived like product improvement, cost reduction, product development or import substitution No benefits derived in the year under review
(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- No new technology is imported during the last three years
(a) the details of technology imported --
(b) the year of import; --
(c) whether the technology been fully absorbed --
(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof --
(iv) the expenditure incurred on Research and Development No expenditure incurred on Research and Development

Conservation of Energy which is an ongoing process in the Companys construction activities and the same is not furnished as the relative rule is not applicable to your company.

There is no information to be furnished regarding Technology Absorption as your company has not undertaken any research and development activity in any manufacturing activity nor any specific technology is obtained from any external sources which needs to be absorbed or adapted.

Innovation is a culture in the Company to achieve cost efficiency in the construction activity so as to be more competitive in the prevailing environment.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In accordance with the provisions of Section 134 of the Companies Act, 2013, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the information relating to foreign exchange earnings and outgo during the year in terms of actual outflows is as follows:

Foreign Exchange Inflows: NIL
Foreign Exchange Outflows : NIL

INTERNAL AUDIT & CONTROLS

The Company to engage M/s. S R Kumar & Associates, Chartered Accountants, as its Internal Auditor of the Company for the financial year 2017-18 and their report is reviewed by the Audit Committee from time to time. During the year, the Company continued to implement their suggestions and recommendations to improve the control environment. Their scope of work includes review of processes for safeguarding the assets of the Company, review of operational efficiency, effectiveness of systems and processes, and assessing the internal control strengths in all areas. Internal Auditors findings are discussed with the process owners and suitable corrective actions taken as per the directions of Audit Committee on an ongoing basis to improve efficiency in operations.

INTERNAL FINANCIAL CONTROL SYSTEMS

The Company has adequate Internal Financial Controls consistent with the nature of business and size of the operations, to effectively provide for safety of its assets, reliability of financial transactions with adequate checks and balances, adherence to applicable statutes, accounting policies, approval procedures and to ensure optimum use of available resources. These systems are reviewed and improved on a regular basis. It has a comprehensive budgetary control system to monitor revenue and expenditure against approved budget on an ongoing basis.

MANAGEMENT REPLIES TO AUDITORS REPORT STANDALONE AND CONSOLIDATED FINANCIAL REPORTS:

With reference to observations made in Auditors Report, the notes of account is self-explanatory and therefore do not call for any further comments. The Auditors Report does not contain any qualification. The results for the year ended March 31, 2017 have been subjected to an audit by the Statutory Auditors of the Company and a qualified report has been issued by them thereon.

INDUSTRIAL RELATIONS

The company enjoyed cordial relations with its employees during the year under review and the Board appreciates the employees across the cadres for their dedicated service to the Company, and looks forward to their continued support and higher level of productivity for achieving the targets set for the future.

LISTING WITH STOCK EXCHANGES:

The Securities Exchange Board of India (SEBI), on 2nd September, 2015, has issued SEBNI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with an aim to consolidate and streamline the provisions of Listing Agreement for different segments of capital market to ensure better enforceability. The said regulations were effective from 1st December, 2015. Accordingly, all listed entities were required to enter into the Listing Agreement within 6 months from the effective date. The Company entered into Listing Agreement with the BSE Limited. The shares of the company are listed on The Bombay Stock Exchange.

The Company confirms that it has paid the Annual Listing Fees for the year 2017-18 to BSE where the Companys Shares are listed.

HUMAN RESOURCES

Your Company treats its "human resources" as one of its most important assets.

Your Company continuously invests in attraction, retention and development of talent on an ongoing basis. A number of programs that provide focused people attention are currently underway. Your Company thrust is on the promotion of talent internally through job rotation and job enlargement

ACKNOWLEDGEMENTS

Your Directors wish to express their appreciation of the support and co-operation of the Central and the State Government, bankers, financial institutions, suppliers, associates and subcontractors and seeks their continued patronage in future as well.

For and on behalf of the Board of Directors of
Sea Gold Infrastructure Limited
Sd/- Sd/-
Mr. P.V. Krishna Reddy Mr. Syed Khaleel Ahmed
Managing Director Director
DIN: 00308975 DIN: 05347153
Date: 02.09.2017
Place: Hyderabad
REGISTERED OFFICE
CIN: L70200TG1993PLC016389
Plot No. 23, Phase IV, IDA Jeedimetla
Hyderabad 500 055
Telangana, India.