sunteck realty ltd Directors report

To

The Members,

Sunteck Realty Limited

Your Directors have the pleasure in presenting the 40th Annual Report of the Company on the business and operations of the Company together with the Audited Statement of Accounts for the year ended 31st March, 2023.

FINANCIAL HIGHLIGHTS

The Companys performance during the financial year ended 31st March, 2023 as compared to the previous financial year is summarised below:

				(Rs. in Lakhs)
Particulars	Consolidated		Standalone
	For the year ended on March 31, 2023	For the year ended on March 31, 2022	For the year ended on March 31, 2023	For the year ended on March 31, 2022
Revenue from Operations	36,244.72	51,307.56	12,161.86	21,854.11
Other Income	2,842.59	2,094.72	2,742.83	1,239.60
Total Income	39,087.31	53,402.28	14,904.69	23,093.71
Total Expenditure	39,339.33	50,264.47	16,629.63	21,649.37
Profit for the period before tax and share of profit/ (loss) of Associates/ Joint ventures and exceptional items	(252.02)	3,137.81	(1,724.94)	1,444.34
Share of profit/(loss) of Associate/ Joint Ventures	700.37	117.26	-	-
Exceptional Items		-	-	-
Profit/ (Loss) Before Tax	448.35	3,255.07	(1,724.94)	1,444.34
Current Tax	817.88	285.82	3.49	222.48
Deferred Tax	(510.42)	460.35	(566.51)	(67.89)
Profit/ (Loss) After Tax	140.89	2,508.90	(1,161.92)	1,289.75
Other Comprehensive Income	1,591.10	646.43	(145.59)	68.82
Total Comprehensive Income	1,731.99	3,155.33	(1,307.51)	1,358.57

REVIEW OF OPERATIONS

During the year under review, the consolidated total income for the current year amounted to Rs.39,087.31/- Lakhs compared to Rs.53,402.28/- Lakhs in the previous year. The Profit/ (Loss) before tax on consolidated basis stands at Rs.448.35/- Lakhs as compared to Rs.3,255.07/- Lakhs during the previous year.

The total income earned is Rs.14,904.69 Lakhs compared to previous years revenue of Rs.23,093.71/- Lakhs on standalone basis. The Profit/ (Loss) before tax on standalone basis stands at Rs.(1,724.94/-) Lakhs compared to Rs.1,444.34/- Lakhs during the previous year.

NATURE OF BUSINESS

The Company is engaged in the activities of real estate development of residential and commercial projects. During the year under review, there was no change in the nature of business of the Company.

DIVIDEND

Your Directors are pleased to recommend final dividend of 150% (i.e. Rs.1.50/- per equity share of the face value of Re. 1 each) to the shareholders for the financial year ended 31st March, 2023. The dividend shall be subject to the approval of the shareholders at the ensuing Annual General Meeting. Total outflow on account of dividend shall amount to Rs.219,718,077 (Rupees Twenty One Crore Ninety Seven Lakh Eighteen Thousand Seventy Seven Only).

As per Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), Dividend Distribution Policy was adopted to set out the parameters and circumstances that will be taken into account by the Board in determining the distribution of dividend to its shareholders and/or retaining profits earned by the Company. The Board of the Company has adopted a Dividend

Distribution Policy which is available on the website of the Company https://www.sunteckindia.com/images/investor/ code_Policy/1686134887_dividend-distribution-policy.pdf

TRANSFER TO RESERVES

Your Directors do not propose to transfer any amount to reserves out of the profits earned during financial year 202223.

SHARE CAPITAL

During the year under review, your Company allotted 28,723 Equity Shares of face Value of Re. 1/- each (Rupee One Only) to option grantees pursuant to exercise of options under Companys Employee Stock Option Scheme 2017 and 2018 (ESOS 2017 and 2018). All allotted shares rank pari-passu to the existing shares of the Company in all respects.

Pursuant to the above allotment, the paid up capital of the Company increased to 146,478,718 Equity shares of Re. 1/- each aggregating to Rs.146,478,718/- (Rupees Fourteen Crores Sixty Four Lakh Seventy Eight Thousand Seven Hundred and Eighteen Only).

DEPOSITS

In terms of Sections 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposit) Rules, 2014 during the year financial year 2022-23, your Company has not accepted any deposits from public and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the Balance Sheet.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES

As on 31st March, 2023, the Company had 25 subsidiaries which includes 3 foreign companies and 3 LLPs. Additionally, the Company has 4 joint venture which includes 1 foreign company and 2 LLPs.

During the year, the Company through its wholly owned subsidiary, Clarissa Facility Management LLP, acquired 100% equity shares of Rusel Multiventures Private Limited (Rusel), pursuant to which Rusel, became a step down subsidiary of the Company.

The Board of Directors of the Company and its wholly owned subsidiary, Starlight Systems (I) Private Limited (the "Transferor Company"), have approved the arrangement for amalgamation of the Transferor Company on a going concern basis with the Company (the "Transferee Company") in their respective meetings held on 10th November, 2022. The Company has filed necessary applications with the National Company Law Tribunal (NCLT) for approval of the aforesaid scheme.

Post 31st March, 2023, Magnate Industries LLP, a wholly owned subsidiary of the Company has been converted into a private company limited by shares i.e. Maganate Industries Private Limited with effect from 17th May, 2023 and it continues to be the wholly owned subsidiary of the Company.

The Board of Directors of the Company at its board meeting held on 26th May, 2023, have approved the Scheme of Amalgamation of its wholly owned subsidiaries i.e. Skystar Buildcon Private Limited, Advaith Infraprojects Private Limited, Magnate Industries Private Limited and Shivay Brokers Private Limited (the Transferor Companies) with Sunteck Realty Limited (the Transferee Company) pursuant to the provisions of Sections 230 to 232 and other applicable sections and provisions of the Companies Act, 2013. The said Scheme of Amalgamation is subject to the requisite statutory and regulatory approvals.

As per Section 129(3) of the Companies Act, 2013, the consolidated financial statements of the Company, its subsidiaries, associates and joint venture entities in accordance with applicable Accounting Standards issued by The Institute of Chartered Accountants of India, forms part of this Annual Report. The performance and financial position of each of the subsidiaries, associates and Joint Venture companies for the year ended 31st March, 2023 is attached to the financial statements hereto in Form AOC 1.

In terms of Section 136 of the Companies Act, 2013, separate audited accounts in respect of each of subsidiaries have been placed on the website of the Company. Further, the Company shall provide a copy of separate audited annual accounts in respect of each of its subsidiary to any member of the Company who asks for it and said annual accounts will also be kept open for inspection at the Registered Office of the Company.

The Company has formulated a policy for determining material subsidiaries and such policy is disclosed on Companys website https://www.sunteckindia.com/investor-relations.

MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL

In compliance with provisions of Section 152 of the Companies Act, 2013, Mr. Atul Poopal, Director of the Company retires by rotation at the ensuing AGM and being eligible, offers himself for re-appointment. Appropriate resolution for aforesaid re-appointment is being placed for approval of the members at the ensuing AGM.

The Board has received declarations from the Independent Directors as per the requirement of Section 149(7) of the Companies Act, 2013 and the Board is satisfied that the Independent Directors meet the criteria of independence as mentioned in Section 149(6) of the Companies Act, 2013. The Board confirms that the Independent Directors who were required to, have duly passed the online proficiency self-assessment test conducted by the Indian Institute of Corporate Affairs.

The certificate under Regulation 34(3) of Listing Regulations forms part to this report.

DISCLOSURES RELATED TO BOARD, COMMITTEES AND POLICIES Board Meetings

The Board of Directors met 4 times during the financial year ended 31st March, 2023 in accordance with the provisions of the Companies Act, 2013 and rules made thereunder. The Directors actively participated in the meetings and contributed valuable inputs on the matters brought before the Board of Directors from time to time.

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 31st March, 2023, 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 explanation relating to material departures, if any;

b. such accounting policies 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 on 31st March, 2023 and of the profit 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.

Committees of the Board

a) Audit Committee

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

b) Nomination and Remuneration Committee

A Nomination and Remuneration Committee is in existence in accordance with the provisions of subsection (3) of Section 178 of the Companies Act, 2013. Kindly refer to the section on Corporate Governance, under the head, Nomination and Remuneration Committee for matters relating to constitution, meetings, functions of the Committee and the remuneration policy formulated by this Committee.

c) Corporate Social Responsibility Committee

The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company during the year are set out in Annexure I of this report as per the format prescribed in Companies (Corporate Social Responsibility Policy) Rules, 2014 as amended thereto.

The CSR Policy may be accessed on the Companys website at the link https://www.sunteckindia.com/investor- relations

d) Other Board Committees

For details of other Board Committees viz. Stakeholders Relationship Committee and others, kindly refer to the section Committees of the Board of Directors which forms part of the Corporate Governance Report.

Vigil Mechanism for the Directors and Employees

In compliance with provisions of section 177(9) and (10) of the Companies Act, 2013 read with Regulation 22 of the Listing Regulations, your Company has adopted whistle blower policy for Directors and employees to report genuine concerns to the management of the Company. The whistle blower policy of the Company is posted on the website of the Company and may be accessed at https://www.sunteckindia.com/investor-relations

Risk Management

The Companys management systems, organisational structures, processes, standards, code of conduct and behaviors together form the system that governs how the Group conducts the business of the Company and manages associated risks. The Board has constituted Risk Management Committee for monitoring and reviewing of the risk assessment, mitigation and risk management plan from time to time. The Risk Management Committee of the Board is responsible for developing and monitoring the risk management policies and also oversees how management monitors compliance with the Companys risk management policies and procedures.

The approach is based on identification, evaluation, and mitigation of operational, strategic and environmental risks, disciplined risk monitoring and measurement and continuous risk assessment and mitigation measures.

Annual Evaluation of Directors, Committee and Board

A formal evaluation mechanism has been adopted for evaluating the performance of the Board, the Committees thereof, individual Directors and the Chairman of the Board. The evaluation is based on criteria which include, among others, providing strategic perspective, integrity and maintenance of confidentiality and independence of judgment, Chairmanship of Board and Committees, attendance, time devoted and preparedness for the Meetings, quality, quantity and timeliness of the flow of information between the Board Members and the Management, contribution at the Meetings, effective decision making ability, monitoring the corporate governance practices, role and effectiveness of the Committees and effective management of relationship with stakeholders. Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the Board has carried out an annual evaluation of its own performance, performance of its directors individually and the committees of the Board and the same is reviewed by the Nomination and Remuneration Committee.

Particulars of Remuneration

The information as required under the provisions of Section 197(12) of the Companies Act, 2013 and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are set out in Annexure IV attached hereto.

The information required pursuant to Section 197 of the Companies Act, 2013 read with Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is available for inspection by the members at registered office of the Company during business hours on working days up to the date of the ensuing AGM. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary, whereupon a copy would be sent.

DISCLOSURE RELATING TO EMPLOYEE STOCK OPTION SCHEMES

In compliance with the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, as amended thereto, the details of Employees Stock Option Schemes of the Company as on 31st March, 2023 are furnished in Annexure II attached herewith and forms part of this Report and is also available on the website of the Company https://www.sunteckindia.com/investor-relations. The ESOS Schemes of the Company are in compliance with the provisions of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021.

PARTICULARS OF LOANS, ADVANCES, GUARANTEES, OR INVESTMENTS

Pursuant to Section 186 of the Companies Act, 2013 and Schedule V of the Listing Regulations, details of Loans, guarantees and investments given/made during the financial year under review are part of the financial statements.

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 the ordinary course of business and on arms length basis. There are no material significant related party transactions made by the Company with Promoters, Directors, or Key Managerial Personnel which may have a potential conflict with the interest of the Company at large. In view of the above, the requirement of giving particulars of contracts/arrangements/transactions made with related parties, in Form AOC-2 is not applicable for the year under review.

The Policy on related party transactions and procedures dealing with related party transactions as approved by the Board may be accessed on the Companys website at https://www.sunteckindia.com/investor-relations.

Disclosure on related party transactions is provided in notes to financial statements.

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 the date of this report.

INTERNAL FINANCIAL CONTROLS

The Company has adequate Internal Financial Controls in place with reference to financial statements and is operating effectively. The Companys IFC framework is commensurate with its size, scale and complexity of operations. The controls, based on the prevailing Business conditions and processes have been reviewed by the Company to strengthen the same wherever required. In compliance with the provisions of section 138 of the Companies Act, 2013 read with Rule 13 of Companies (Accounts) Rules, 2014, the internal control systems are supplemented by Internal Audit carried out by independent firm of Chartered Accountants for periodical review by management. The Audit committee reviews the reports submitted by the Internal Auditors in its meeting.

DISCLOSURE OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL

There are no significant material orders passed by the Regulators/ Courts which would impact the going concern status of the Company and its future operations. No application is made and no proceeding is pending against the Company under the Insolvency and Bankruptcy Code, 2016 and there is no instance of one time settlement of the Company with any Bank or Financial Institution.

STATUTORY AUDIT AND AUDITORS REPORT

Pursuant to the provisions of Section 139 of Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, as amended, M/s. Walker Chandiok & Co LLP, Chartered Accountants, (Firm Registration number-001076N/ N500013) were appointed as the Statutory Auditors of the Company for a term of 5 years to hold office from the conclusion of the 37th Annual General Meeting held on 29th September, 2020 till the conclusion of 42nd Annual General Meeting to be held in the year 2025. The Company has received a certificate from Walker Chandiok & Co. LLP that they are eligible to hold office as the Auditors of the Company and are not disqualified for being so appointed. Observations of statutory auditors on accounts for the year ended 31st March, 2023:

There are no qualifications, reservations or adverse remarks made by M/s. Walker Chandiok & Co LLP. Chartered Accountants, Statutory Auditors of the Company, in their report for the financial year ended 31st March, 2023.

SECRETARIAL AUDIT

As required under the provisions of Section 204 of the Companies Act, 2013, the Secretarial Audit report of the Company carried out by Mr. Veeraraghavan N., Company Secretary in practice for the 2022-23, in Form MR-3, forms part to this report. Pursuant to Regulation 24A of Listing Regulations, the Secretarial Audit Reports in respect of the material unlisted subsidiaries of your Company viz., Skystar Buildcon Private Limited, Satguru Corporate Services Private Limited and Rammit Corporate Solutions Private Limited for 2022-23, forms part of this report. The said reports does not contain any qualification, reservation or adverse remark or disclaimer.

COST AUDIT

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, Maintenance of Cost records and Cost Audit is applicable which has been complied with by the Company. On the recommendation of the Audit Committee, the Board has re-appointed M/s. Kejriwal & Associates, Cost Accountants (Firm Registration No. 101363), to audit the cost accounts of the Company for the financial year ending on 31st March, 2023. Remuneration payable to the Cost Auditor needs to be ratified by the members of the Company and hence, a resolution seeking members ratification for the remuneration payable to the Cost Auditor is included in the Notice convening the AGM.

ANNUAL RETURN

The Annual Return in Form MGT-7 for the financial year ended 31st March, 2023, is available on the website of the Company at https://www.sunteckindia.com/investor-relations.

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

The Company adopts good practices by using rainwater harvesting thereby lowering fresh water intake and reducing run-offs. The Company uses Dual Fitting Tanks and LED lights which reduces the burden on energy usage in the construction area. The Company uses steel products for rolling mills which saves considerable amount of natural resources and energy required to convert steel from ores. Fly ash and GGBS are the waste generated from the thermal power plant and steel plants respectively used in concrete which consumes waste generated by other industries and also produce more durable concrete. Sites are covered with G1 sheets which reduces the equipment noise and prevents dust getting blown up in air in windy days. The use of STP water for flushing and gardening reduces the burden on natural water resources. Wherever possible solar PV panels for common area lighting are used which in turn reduces the carbon footprints.

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

i) Foreign Exchange Earned: Rs.26,034,749 (P.Y. Nil)

ii) Foreign Exchange Outflow: Rs.90,547,503 (P.Y. Rs.212,533,872)

INFORMATION REQUIRED UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2014

During the year under review, no case was filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Your Company has a policy and framework for employees to report sexual harassment cases at workplace and the process ensures complete anonymity and confidentiality of information. The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

COMPLIANCE WITH SECRETARIAL STANDARDS

During the year under review, the Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI).

OTHER DISCLOSURES Corporate Governance

The report on Corporate Governance and the certificate from Company Secretary in Practice 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 and Sustainability Report

Pursuant to Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Responsibility and Sustainability Report of the Company for the financial year ended 31st March, 2023 is attached as Annexure III which forms part of this Report.

Fraud Reporting

No fraud has been reported during the audit conducted by Statutory Auditors, Secretarial Auditors and Cost Auditors of the Company.

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.

ACKNOWLEDGEMENT AND APPRECIATION

Your Directors would like to express their sincere appreciation and gratitude for the co-operation and assistance from its shareholders, bankers, regulatory bodies and other business constituents during the year under review.

Your Directors also wish to place on record their deep sense of appreciation for the contribution and commitment made by every member of the Sunteck Family.

	For and on behalf of the Board of Directors
	Kamal Khetan
	Chairman & Managing Director
Mumbai, 26th May, 2023	(DIN:00017527)