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Your Directors have pleasure in presenting the Fourteenth Annual Report together with audited financial statement of SORIL Infra Resources Limited ("the Company") for the financial year ended March 31, 2019.
The highlights of the financial results of the Company for the financial year ended March 31, 2019 are as under:
(Amount in )
|Particulars||For the Financial Year ended March 31, 2019||For the Financial Year ended March 31, 2018|
|Profit/ (Loss) before Tax and Depreciation||34,70,53,297||32,55,89,317|
|Less: Depreciation of Fixed Assets||19,64,85,247||14,71,22,197|
|Profit/ (Loss) before Tax||15,05,68,050||17,84,67,120|
|Less: Prior Period Tax Adjustments||-||-|
|Less: Current Period Tax Adjustments||4,65,732||18,523|
|Profit/ (Loss) after Tax||15,01,02,318||17,84,48,597|
|Add: Other Comprehensive Income / (Loss)||65,44,805||(2,81,621)|
|Add: Profit/ (Loss) brought forward||(1,49,76,45,103)||(1,67,25,91,195)|
|Amount available for appropriation||(1,34,09,97,980)||(1,49,44,24,219)|
|Proposed dividend on preference shares||26,76,105||26,76,105|
|Corporate dividend tax thereon||5,50,081||5,44,792|
|Balance carried forward to Balance Sheet||(1,34,42,24,166)||(1,49,76,45,116)|
The Board has not proposed to transfer any amount to any reserve(s).
The Company endeavours to create sustainable business for the benefit of its stakeholders. With a view to tap into lending opportunities in un-served rural India, the Company, during the year, forayed into financial services business with the primary focus on financing in rural markets by acquiring 100% stake in an existing Non-Banking Finance Company registered with RBI. Through this 100% owned NBFC, the Company has undertaken such rural and macro financing / lending business.
The Company is operating in the following businesses:
1. Equipment renting services,
2. LED lighting,
3. Financing & related activities,
4. Management and maintenance services, and
5. Construction advisory and other related activities
The Directors believe that these businesses have huge potential as explained in the following paragraphs:
Equipment renting services branded as "Indiabulls Store One" ( www.indiabullsstoreone.com )
The Company is one of the largest equipment rental solutions providers in India with pan-India projects of its customers and operates from offices in Mumbai, Gurugram, Kolkata, Hyderabad, Bangalore, Ahmedabad, Pune and Chennai. The rental fleet of 660 equipment is operated across more than 85 projects sites. Primary equipment in the rental fleet are Tower Cranes, Passenger Hoists, Piling Rigs, Excavators, Dozers, Motor Graders, Wheel Loaders, Mobile Boom Placers, Transit Mixers, Dumpers, Steel Stir-up machines, Concrete Batching Plants etc of reputed International & Indian manufactures.
The Company has also forayed into new equipment sales & service business in aerial work platform segment, for which it has tied up with international manufacturers for distribution of their scissor lifts & boom-lifts in India. Aerial Work Platform is one of the fastest growing equipment segments across the world and has great potential in developing countries like India. By adding new machine sales, the Company has become a full equipment service provider, providing tailor made solution for rental, sales, and service to its esteemed customers.
The business is being managed by a professional & experienced team, who have vast knowledge and hands on experience in managing the rental & leasing fleet across several industry segments.
Companys customer base is spread across industry segments such as Real Estate, Precast, Infrastructure, Metro, Petroleum Refinery, Piling, Industrial, and Road. In FY 2018-19, renting services has achieved a revenue growth of 52.23% on YoY basis. Our customers are primarily major players in infrastructure and construction segments with large order books. Our customers look for a professional rental companies which can take care of their equipment needs for multiple projects. This in turn allows our customers to focus on their core strength of managing & executing the projects.
The benefits of Companys offering to the customers are:
Short term and long term rental agreements
Ability to take on critical projects
Vast equipment fleet
Experienced operations team to respond to challenges during project execution
Giving high importance to safety of manpower and deployed equipment
Reduction in overhead expenses, followed by lowering of technical and other maintenance charges
The Company believes that the Government Policy initiatives like Housing for all and Smart cities mission and 100 percent FDI permission under the automatic route across various infrastructure sectors makes the future prospects very promising. India is expected to become the third largest construction market globally by 2022, and the required investment of 56.11lakh crores (USD 777.73 billion) will have substantial impact.
As part of its long term growth strategy, the Company will grow its presence across major cities in India and increase its product offerings. We shall strive to be preferred rental partner of our customers.
LED lighting branded as "Ib LED" ( www.indiabullsled.com )
LED business started with Projects in the Institutional LED Lighting market in FY 2017-18 and expanded to Consumer LED Lighting market in 2018-19. Within this short span of time the Company has reached a turnover of about 46.5 crores (net of taxes). The Directors believe that the operations of Led Lighting is progressing by virtue of continuous efforts in establishing excellence in product value offered, technology and design innovation, and supply chain and distribution network. The Company shall maximise automation and digitisation to improve productivity and increase shareholder value.
The vision of the Company is to establish itself in the consumer product segments through LED Lights and scale up the operations to other products at the appropriate time. According to a report from the Electric Lamp and Component Manufacturers Association (ELCOMA), the Indian LED market is expected to grow to 26,100 crores by 2020, which is approximately 80 percent of the total lighting industry. TechSci (a global research-based consulting firm) has advised that the LED lighting market in India is projected to register a CAGR of over 24 percent during 2016-2021.
In a short span of time, the Company has established a professional design and development team comprising of experienced Illumination Engineers and Industrial Designers who have developed product offerings of 715 SKUs in our LED lighting portfolio. The Company has set up a technologically advanced Lighting Innovation Centre in Mumbai, which is best in class in the industry.
The Company is ISO 9001:2015 certified for Design, Development, Engineering, Marketing and supply of LED Luminaires, Lighting Controls and Accessories including Electronics drivers, as well as for Lighting Design and Marketing Services.
The products are marketed through 23 offices across the Country, and distributed across a network of 131 town/cities of India through 250 channel partners & more than 5000 retail points, as of 31st July, 2019.
Indiabulls LED is working with major IT/ITES, Banking and Financial Institutions, Real Estate Developers, Manufacturing Industries, Pharmaceutical Industries, and Infrastructure Projects. It has been able to win several prestigious project supply orders in various trade sectors.
The IB LED team is proud to present to its shareholders one of the most popular product ranges of the Company. Indiabulls LED: A Light Wellness Company
Light Wellness by Indiabulls LED is a lighting system that replicates the natural daylight through artificial lighting to boost emotional wellbeing, health, comfort and productivity of individual.
Urban lifestyle compels us to work and carry out most of our routine activities under artificial light in homes, offices, factories and other workplaces. This lifestyle has been affecting individuals with stress, anxiety, insomnia and eye- related diseases to name a few. Circadian Rhythm are physical, mental and behavioural changes that follow a daily cycle.
The Light Wellness concept is brought about through our daily effective lighting system that creates dynamic lighting for agile workspaces with dynamic color temperature changing lighting solutions ranging between 2000K - 8000K.
Light wellness is an Innovation from Indiabulls LED. It significantly improves the lighting ambience and conditions, thereby helps individual to handle occupational and lifestyle factors more effectively and increases employee productivity at the workplace.
The Directors are proud of the efforts of the IB LED team in establishing the business from scratch. The Company expects demand growth to accelerate for the following factors: rising disposable income, easy access to credit, electrification of rural areas, and above all, exciting innovation and cost saving opportunity in LED lighting products
Financing & related activities, branded as "Indiabulls Rural Finance" ( www.indiabullsruralfinance.com )
To tap into lending opportunities in un-served rural India, the Company, during FY 2018-19 forayed into financial services business with the primary focus on financing in rural markets and acquired 100% stake in "Littleman Fiscal Services Private Limited", an existing Non-Banking Finance Company registered with RBI on 25th January, 2019. Through this 100% owned NBFC, the Company has undertaken such rural and macro financing / lending business. Subsequently the name of the Company was changed to Indiabulls Rural Finance Private Limited. This NBFC company is a non-deposit taking, non-systemically important Non-Banking Finance Company.
The Company, through its this NBFC arm, deals majorly in secured lending business and will tap into financing opportunities in underserved Semi-urban and rural India, including Tier II & III cities for Micro, Small and Medium Enterprises("MSME"). The team strives to bridge the existing credit gaps in this sector.
MSMEs are currently drivers of economic growth in the country.
Brief overview of MSME sector:
|MSME Units (#)||Jobs created||Contribution to exports||% of GDP|
|5.6 crores||12.4 crores||45% of total exports||31% of the GDP|
Debt Demand and Debt Gap in India
|Debt Demand Growth||Debt Demand- sector wise|
|21% CAGR||47% Manufacturing|
|53% service sector|
Data Source: Financing Indias MSME- IFC World bank Report Nov 2018
MSMEs make significant contribution to GDP and employment and there lies great opportunity to fulfil the credit gap of about 25.80 lacs crores.
The Company shall reform, perform and transform the credit delivery by virtue of people, technology and understanding of customer profile. The Company is confident of capitalising on the present NBFC environment by virtue of its approach to business and continuous focus of Government on Rural Economy. Government has further initiated recapitalisation of public sector banks, relaxation in securitisation norms, expansion of infrastructure, and easing the FDI and ECB route to investments.
Assets under management as on 31st March, 2019 was 140.44 crores with Capital adequacy ratio of 78.46%. The Company has made an equity investment of 117.04 crores as on 31st March, 2019, to capitalize this NBFC for its business needs.
Management and maintenance services:
The Company has developed expertise in all avenues of management and maintenance of properties. The Companys current projects span more than two million square feet of high end Commercial and Residential developments wherein the revenue in the current year was 20 crores from maintenance of residential properties in Mumbai and NCR.
Construction advisory and other related activities
The Company provides advisory services pertaining to identification and acquisition of land, project planning, design management, construction, execution, maintenance and management of completed projects, as well as consultancy and advisory services on engineering and other related technical matters. Income from construction and related activity was 3.63 crores in the current year.
To streamline the operations and ownership structure of the Company, in a manner leading to maximization of stakeholders value and diversification of shareholders portfolio by providing them direct ownership in each business segments, the Board of Directors of the Company has approved the composite Scheme of Arrangement amongst the Company, its holding company Indiabulls Integrated Services Limited ("IBULISL") and their subsidiaries (viz, Albasta Wholesale Services Limited, Sentia Properties Limited, Lucina Infrastructure Limited, Ashva Stud and Agricultural Farms Limited, Mahabala Infracon Private Limited, Store One Infra Resources Limited, Indiabulls Enterprises Limited and Indiabulls Pharmacare Limited) and Indiabulls Pharmaceuticals Limited and their respective shareholders and creditors ("Scheme"). The public shareholders of the Company, will also get the benefit of having the direct ownership in the life and non-life insurance businesses, being carried out under IBULISL.
Pursuant to the Scheme, the public shareholders of the Company will get extra shares of IBULISL and Indiabulls Enterprises Limited free of any cost, in lieu of their shareholding in the Company. With this, post effectiveness of the Scheme, they will have shares of two listed entities -
(1) IBULISL, shares of which are listed on NSE and BSE, focusing on insurance and related businesses, and
(2) Indiabulls Enterprises Limited, shares of which will be listed on NSE and BSE, focusing on non-insurance businesses of the Company and of IBULISL and their subsidiaries (including proposed pharma business and rural finance business).
The Scheme is subject to all applicable statutory and regulatory approvals, including approval from the stock exchanges, SEBI, shareholders and creditors of the company(ies) involved in the Scheme and the jurisdictional bench of the NCLT. The Company has already filed the Scheme with National Stock Exchange of India Limited and BSE Limited for seeking their & SEBIs NOC to the Scheme, which is awaited.
CHANGE IN THE REGISTERED OFFICE OF THE COMPANY
During the FY 2018-19, post seeking all applicable regulatory approvals, the registered office of the Company was shifted from "National Capital Territory of Delhi" to the "State of Haryana" and w.e.f. January 17, 2019, the registered office of the Company is situated at its corporate office at Plot No. 448-451, Udyog Vihar, Phase-V, Gurgaon-122016, Haryana, which is providing effective and smooth conduct of the Companys operations economically, viably and efficiently at reduced cost with better administrative control, supervision and convenience.
In view of the accumulated losses and in order to utilize the profits for business requirements of the Company, your Directors do not recommend any dividend for the FY 2018-19.
DIRECTORS & KEY MANAGERIAL PERSONNEL
During the FY 2018-19, Mr. Anil Malhan (DIN: 01542646), Mr. Divyesh Bharatkumar Shah (DIN: 00010933), Mrs. Sargam Kataria (DIN: 07133394), Mr. Gurinder Singh (DIN: 08183046) and Brig. Labh Singh Sitara (DIN: 01724648) were appointed on the Board of the Company, and Ms. Pia Johnson (DIN: 00722403), Col. (Retd.) Surinder Singh Kadyan (DIN: 03495880), Mr. Shamsher Singh Ahlawat (DIN: 00017480) and Mr. Joginder Singh Kataria (DIN: 05202673) resigned from the office of director(s) of the Company with effect from July 20, 2018.
The present term of Mr. Prem Prakash Mirdha (DIN: 01352748), an Independent Director of the Company, shall come to an end on September 25, 2019. The Board constituted Nomination and Remuneration Committee evaluated his performance and considering the experience and contribution made by him during his tenure, recommended to the Board his re-appointment. Therefore, to ensure continuity of guidance from Mr. Mirdha, the Board has reappointed and recommended his re-appointment for the approval of shareholders as an Independent Director of the Company, not liable to retire by rotation, for a term of 3 years from the conclusion of his present term. Keeping in view, the vast experience and knowledge of Mr. Mirdha, the Board is of the view that his appointment as an Independent Director on the Board will be in the interest of the Company. Upon getting approval of the shareholders for his appointment as an Independent Director his appointment shall be formalized by issuing a letter of appointment to him, which shall be open for inspection by the members at the registered office of the Company, in terms of applicable provisions of the Companies Act, 2013.
In accordance with Section 152 of the Companies Act, 2013 and rules framed thereunder, and in terms of the Articles of Association of the Company, Mr. Divyesh Bharatkumar Shah (DIN: 00010933), Non-Executive Director, is liable to retire by rotation, and being eligible, has offered himself for re-appointment at the ensuing Annual General Meeting. The Board of Directors recommended his re-appointment.
All the present Independent Directors of the Company have given declaration that they meet the Criteria of Independence laid down under Section 149(6) of the Companies Act, 2013.
The matter relating to appointment/ re-appointment of aforementioned directors have been included in the Notice convening the 14th Annual General Meeting of the Company. The brief resume of the Directors proposed to be appointed/ reappointed, nature of their expertise in specific functional areas and name of the Companies in which they hold directorships and memberships/chairmanships of Board Committees and other requisite information, are provided in the Notice convening the 14th Annual General Meeting of the Company.
During the FY 2018-19, the Company, pursuant to and in terms of Chapter VII of the then applicable SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009, on October 10, 2018, issued and allotted an aggregate of 39,00,000 fully paid up equity shares of face value of 10/- each of the Company, at an issue price of 539 (including a premium of 529) per equity share to certain foreign portfolio investor(s), pursuant to and in terms of shareholders approval dated September 29, 2018.
An aggregate amount of 210.21 crores raised by the Company through aforesaid preferential issue, has been utilized towards capitalization / funding companys wholly owned subsidiary, as per stated objects of the issue.
Consequent to the said allotment, the paid up share capital of the Company stands increased to 31,50,00,000 comprising of 3,15,00,000 equity shares of 10/- each.
EMPLOYEE STOCK OPTIONS
As on March 31, 2019, an aggregate of 45,00,000 Employees Stock options were in force. These options upon exercise are convertible into equal number of Equity Shares of the Company. As and when these options are exercised, the paid-up share capital of the Company shall stand increased accordingly.
The disclosures required to be made in compliance with the applicable regulations have been placed on the website of the Company www.sorilinfraresources.com
During the year under review, the Company has not accepted any deposits from the public, falling within the ambit of Chapter V of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014, therefore, the disclosures required in terms of Rule 8 of the Companies (Accounts) Rules, 2014, are not required to be given.
LISTING WITH STOCK EXCHANGES
The Equity Shares (ISIN:INE034H01016) of the Company, continue to remain listed at BSE Limited and National Stock Exchange of India Limited. The listing fees payable to both the exchanges for the financial year 2019-20 have been paid.
(a) Statutory Auditors
The present term of M/s Agarwal Prakash & Co., Chartered Accountants (Firm Registration No. 005975N), the Statutory Auditors of the Company who were appointed by the members at their Ninth Annual General Meeting, held on September 26, 2014, for a period of five years, shall come to an end on the conclusion of the ensuing Fourteenth Annual General Meeting of the Company. It is proposed to re-appoint existing auditors M/s Agarwal Prakash & Co. (Firm Registration No. 005975N), as the Statutory Auditors of the Company, for a further period of five years i.e. from the conclusion of ensuing Fourteenth Annual General Meeting, until the conclusion of the Nineteenth Annual General Meeting of the Company. The Company has received a certificate from the Auditors to the effect that their continuation as such from the conclusion of this Annual General Meeting until the conclusion of Nineteenth Annual General Meeting will be in accordance with the provisions of the Section 141(3)(g) of the Companies Act, 2013.
The Auditors Report forming part of this Annual Report is self-explanatory and therefore do not call for any further explanation. No fraud has been reported by the Auditors of the Company in terms of the provisions of Section 143(12) of the Companies Act, 2013 and Rules framed thereunder.
(b) Secretarial Auditors & Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Rules made thereunder the Company has appointed M/s NP Gupta & Associates, Practicing Company Secretaries, as its Secretarial Auditors to conduct the secretarial audit of the Company for the Financial Year 2018-19. The Company has provided all assistance, facilities, documents, records and clarifications etc. to the Secretarial Auditors for conducting their
audit. The Report of Secretarial Auditors for the Financial Year 2018-19, is annexed as Annexure 1, forming part of this Report. The Secretarial Compliance Report as prescribed by SEBI is annexed as Annexure 2, forming part of this Report. The Reports are self-explanatory and therefore do not call for any further explanation.
CORPORATE SOCIAL RESPONSIBILITY
As part of its initiatives under "Corporate Social Responsibility (CSR)", the Company has undertaken projects as per its CSR Policy (available on Companys website on web-link: http://www.sorilinfraresources.com/dir/investor/28.CSR Policy Store One.pdf ) and the details are contained in the Annual Report on CSR Activities given in Annexure 3, forming part of this Report. These projects are in accordance with Schedule VII of the Companies Act, 2013, read with the relevant rules.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Pursuant to Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as "SEBI LODR") Management Discussion and Analysis Report, for the year under review, is presented in a separate section forming part of this Annual Report.
CORPORATE GOVERNANCE REPORT
Pursuant to Regulation 34 of the SEBI LODR, a separate section on Corporate Governance practices followed by the Company, together with a certificate from a Practicing Company Secretary confirming compliance, is presented in a separate section forming part of this Annual Report.
DIRECTORS RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134 of the Companies Act, 2013:
a) that in the preparation of the annual financial statements for the year ended March 31, 2019, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any;
b) that such accounting policies as mentioned in the Notes to the Financial Statements have been selected and applied consistently and judgments and estimates have been made 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, 2019 and the profit and loss of the Company for the year ended on that date;
c) that proper and sufficient care has been 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) that the annual financial statements have been prepared on a going concern basis;
e) that proper internal financial controls are in place and that such financial controls are adequate and are operating effectively; and
f) that systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.
EXTRACT OF ANNUAL RETURN
In terms of Sections 92(3) and 134(3) of the Companies Act, 2013 and rules framed thereunder, extract of the Annual Return for the Financial Year ended 31st March, 2019 is annexed as Annexure 4, forming part of this Report and is also available at website of the Company, at web-link:
https://www.sorilinfraresources.com/dir/investor/Extract of Annual Return 2019.pdf BOARD MEETINGS
During the FY 2018-19, 9 (Nine) Board Meetings were convened and held. The details of such meetings are given in Corporate Governance Report forming part of this Annual Report. The intervening gap between these meetings was within the period prescribed under the Companies Act, 2013. The notice and agenda including all material information and minimum information required to be made available to the Board under Regulation 17 read with Schedule II Part A
of the SEBI LODR were circulated to all directors, well within the prescribed time, before the meeting or were placed at the meeting with the consent of majority of Directors (including one Independent Director). During the year, separate meeting of the Independent Directors was held on January 29, 2019, without the presence of Non-Independent Directors and the members of the Company Management.
PERFORMANCE EVALUATION OF THE BOARD, ITS COMMITTEES AND DIRECTORS
The Nomination & Remuneration Committee (NRC) of the Board reassessed the framework, methodology and criteria for evaluating the performance of the Board as a whole, including Board committee(s), as well as performance of each director(s) and confirms that the existing evaluation parameters are in compliance with the requirements as per SEBI guidance note dated January 5, 2017 on Board evaluation. The existing parameters includes effectiveness of the Board and its committees, decision making process, Directors/members participation, governance, independence, quality and content of agenda papers, team work, frequency of meetings, discussions at meetings, corporate culture, contribution and management of conflict of interest. Basis these parameters, the NRC had reviewed at length the performance of each director individually and expressed satisfaction on the process of evaluation and the performance of each Director. The performance evaluation of the Board as a whole and its committees, as well as the performance of each director individually was carried out by the entire Board of Directors. The performance evaluation of the Non-Independent Directors and the Board of Directors, as a whole was carried out by the Independent Directors in their meeting held on January 29, 2019. The Directors expressed their satisfaction with the evaluation process.
Also the Executive Director of the Company, on a periodic basis, has had one-to-one discussion with the directors for their views on the functioning of the Board and the Company, including discussions on level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders and implementation of the suggestions offered by Directors either individually or collectively during different board/ committee meetings.
The Board has framed a policy for selection and appointment of Directors, Senior Management and their remuneration on recommendation of Nomination and Remuneration Committee. The Remuneration Policy is briefly stated in the Corporate Governance Report forming part of this Annual Report and is also available at the website of the Company, at web-link: http://www.sorilinfraresources.com/dir/investor/Remuneration%20Policy SORIL%20Infra.pdf
LOANS, GUARANTEES OR INVESTMENTS
During the FY 2018-19, in terms of the provisions of Section 186(1) of the Companies Act, 2013, the Company did not make any investments through more than two layers of investment companies.
The Companys investment/loans/guarantees, during FY 2018-19, were in compliance with the provisions of section 186 of the Companies Act, 2013, particulars of which are captured in financial statements of the Company, forming part of this Annual Report.
RELATED PARTY TRANSACTIONS
During the year, no materially significant related party transaction was entered by the Company with its Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with the interest of the Company at large. Details of all related party transactions are disclosed in the financial statement of the Company forming part of this Annual Report. None of the transactions with related parties is material transaction and/or transaction which is not at Arms length, requiring disclosure pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014. The Policy on materiality of Related Party Transactions and also on dealing with such transactions is available on the website of the Company, at web-link:
http://www.sorilinfraresources.com/dir/investor/18.SORIL Policy for Dealing with Related Party Transactions.pdf INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an elaborate system of internal controls commensurate with the size, scale and complexity of its
operations; it also covers areas like financial reporting, fraud control, compliance with applicable laws and regulations etc. Regular internal audits are conducted to check and to ensure that responsibilities are discharged effectively. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliance with regulatory directives, efficacy of its operating systems, adherence to the accounting procedures and policies. Wherever required, the internal audit efforts are supplemented by audits conducted by specialized consultants/audit firms. Based on the reports of the Internal Auditors, process owners undertake corrective actions, in their respective areas and thereby strengthen the controls.
MATERIAL CHANGES AND COMMITMENTS
Except as disclosed in this report, there are no material changes and commitments, affecting the financial position of the Company, which has occurred between the end of the Financial Year of the Company i.e. March 31, 2019 and the date of this Report.
Further, no significant and material orders were passed by the regulators or courts or tribunals, impacting the going concern status and Companys operations in future.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo, is as under:
A. Conservation of Energy
The Company operations do not account for substantial energy consumption. However, the Company is taking all possible measures to conserve energy. As an ongoing process, the following measures are undertaken:
a) Replacing all of its lighting system with LEDs, which is expected to slash related electricity consumption by over 50%.
b) Installation of five star energy conservation air conditioning systems.
c) Installation of automatic power controllers to save maximum demand charges and energy.
d) Installation of TFT monitors that saves power.
e) Periodic Training sessions for employees on ways to conserve energy in their individual roles.
B. Technology Absorption
The nature of business being carried out by the Company entails an extensive use of effective information technology so as to ensure that its services reach the end users i.e. its clients without any loss of time. The Company has implemented best of the class applications to manage and automate its business processes to achieve higher efficiency, data integrity and data security. It has helped it in implementing best business practices and shorter time to market new schemes, products and customer services.
The Companys investment in technology has improved customer services, reduced operational costs and development of new business opportunities.
C. Foreign Exchange Earnings and Outgo
The details of foreign exchange earnings and outgo is given in the table below: (Amount in
|Particulars||For the year ended March 31, 2019||For the year ended March 31, 2018|
|Foreign Exchange Outgo|
|Purchase of fixed assets and spares and services||22,48,75,730||5,40,26,842|
|Purchase of inventory of LED||1,60,46,953||33,86,407|
|Travelling and conveyance||6,54,452||3,11,402|
|Foreign Exchange Earnings|
|Export sale of LED Lighting||5,01,840||Nil|
BUSINESS RISK MANAGEMENT
Pursuant to the applicable provisions of the Companies Act, 2013, the Company has formulated Business Risk Management policy to identify and evaluate business risks and opportunities. This policy seeks to create transparency, minimize adverse impact on its business objectives and enhance its competitive advantage. It defines the risk management approach across the Company at various levels including the documentation and reporting. At present, the Company has not identified any element of risk which may threaten its existence. The requirement of constituting Risk Management Committee in terms of SEBI LODR is not applicable to the Company.
PARTICULARS OF EMPLOYEES
Pursuant to the applicable provisions of the Companies Act, 2013, read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, disclosures on Managerial Remuneration are provided in Annexure 5, forming part of this Report. In terms of the provisions of Section 136(1) of the Companies Act, 2013, read with the said rules, the Directors Report is being sent to all the shareholders of the Company excluding the annexure on the names and other particulars of employees, required in accordance with Rule 5(2) of said rules, which is available for inspection by the members, subject to their specific written request, in advance, to the Company Secretary. The inspection is to be carried out at the Companys Registered Office during business hours on working days of the Company up to date of ensuing Annual General Meeting.
FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
Independent Directors are familiarized with their roles, rights and responsibilities in the Company as well as with the nature of industry and business model of the Company through presentations about the Companys strategy, business model, product and service offerings, customers & shareholders profile, financial details, human resources, technology, facilities, internal controls and risk management, their roles, rights and responsibilities in the Company.
The Board is also periodically briefed on the various changes, if any, in the regulations governing the conduct of Independent Directors. The details of the familiarization programs have been hosted on the website of the Company, at web-link:
http://www.sorilinfraresources.com/dir/investor/Details of familiarization programmes imparted to independent directors.pdf SUBSIDIARY COMPANIES
Pursuant to Section 129 of the Companies Act, 2013, the Company has prepared its Consolidated Financial Statement along with its subsidiaries, in the same form and manner, as that of the Company, which shall be laid before its Fourteenth Annual General Meeting along with its Standalone Financial Statement. The Consolidated Financial Statements of the Company along with its subsidiaries, for the year ended March 31, 2019, forms part of this Annual Report.
For the performance and financial position of the subsidiaries of the Company, along with other related information required pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the Members are requested to refer to the Financial Statements of the Company.
Further pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited accounts in respect of subsidiaries, are also available on the website of the Company. Shareholders may write to the Company for the annual financial statements and detailed information on subsidiary companies. Further, the documents shall also be available for inspection by the shareholders at the registered office of the Company.
NAMES OF THE COMPANIES WHICH HAVE BECOME OR CEASED TO BE SUBSIDIARIES OR ASSOCIATE COMPANIES
During the FY 2018-19, Indiabulls Rural Finance Private Limited became wholly owned subsidiary of the Company.
COMMITTEES OF THE BOARD
The Company has following Board constituted committees which have been established as a part of the best corporate governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes:
a) Audit Committee
b) Nomination and Remuneration Committee
c) Stakeholders Relationship Committee
d) Corporate Social Responsibility Committee
The details with respect to composition, power, role, terms of reference, etc. of each of these committees are given in the Corporate Governance Report forming part of this Annual Report.
Apart from the above, the Board has also constituted Compensation Committee for administration of stock option scheme(s), Management Committee for operational matters, Issuance Committee for considering issuance of securities and Reorganization Committee for considering, evaluating and implementing reorganization options.
The Board of Directors state that the Company has complied with the applicable Secretarial Standards (SS-1 and SS-2) respectively relating to Meetings of the Board, its Committees and the General Meetings as issued by the Institute of Company Secretaries of India.
NUMBER OF CASES FILED, IF ANY, AND THEIR DISPOSAL UNDER SECTION 22 OF THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has zero tolerance towards harassment at the workplace and has complied with the provisions and constituted an Internal Complaints Committee and also 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 thereunder.
During the financial year 2018-19, no cases of sexual harassment were reported.
APPLICABILITY OF MAINTENANCE OF COST RECORDS
The Company is not required to maintain cost records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013.
The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of its business operations. To maintain these standards, the Company has implemented the Whistle Blower Policy ("the Policy"), to provide an avenue for employees to report matters without the risk of subsequent victimization, discrimination or disadvantage. The Policy applies to all employees of the Company. Pursuant to the Policy, the whistle blowers can raise concerns relating to matters such as breach of Companys Code of Conduct, fraud, bribery, corruption, employee misconduct, illegality, misappropriation of Companys funds / assets etc. A whistle-blowing or reporting mechanism, as set out in the Policy, invites all employees to act responsibly to uphold the reputation of the Company. The Policy aims to ensure that serious concerns are properly raised and addressed and are recognized as an enabling factor in administering good governance practices. The details of the Whistle Blower Policy are available on the website: www.sorilinfraresources.com of the Company. The Audit committee set by the Board, constitutes a vital component of the whistle blower mechanism and instances of financial misconduct, if any, are reported to the Audit committee. No employee is denied access to the Audit Committee.
Electronic copies of the Annual Report 2018-19 and Notice of the Fourteenth AGM are being sent to all the members whose email addresses are registered with the Company / Depository Participant(s). For members who have not registered their email addresses, physical copies of the Annual Report 2018-19 and Notice of the Fourteenth AGM will be sent in the permitted mode.
The Company is providing e-voting facility to all members to enable them to cast their votes electronically on all resolutions set forth in the Notice of the Fourteenth AGM. This is pursuant to section 108 of the Companies Act, 2013 and Rule 20 of the Companies (Management and Administration) Rules, 2014, as substituted by Companies (Management and Administration) Amendment Rules, 2015, and the SEBI LODR. The instructions for e-voting are provided in the AGM Notice.
Your Company has been able to operate efficiently because of the culture of professionalism, creativity, integrity and continuous improvement in all functional areas and the efficient utilization of all its resources for sustainable and profitable growth. Your Directors wish to place on record their appreciation of the contributions made and committed services rendered by the employees of the Company at various levels. Your Directors also wish to express their gratitude for the continuous assistance and support received from the investors, clients, bankers, regulatory and government authorities, during the year.
For and on behalf of the Board of Directors
|Anil Malhan||Sargam Kataria|
|Date: August 14, 2019||Executive Director||Director|