| Dear Members,
We are pleased to present the TWELFTH ANNUAL REPORT AND AUDITED
ACCOUNTS of the company for the financial year ended on 31st March,
2015.
FINANCIAL HIGHLIGHTS
(Figures in Rs.)
Particulars For the year ended For the year ended
31.03.2015 31.03.2014
Revenue 51,44,77,391 51,67,32,054
Operating profit 9,65,16,986 10,82,12,171
Interest 5,12,93,156 4,87,21,127
Depreciation 1,24,00,172 71,35,768
Profit before tax 3,28,23,658 5,23,55,276
Provision for tax 1,24,76,868 2,01,60,325
Profit after Tax (PAT) 2,03,46,790 3,21,94,951
Appropriations
Transfer to general reserve NIL 85,00,000
Dividend (including tax on
distributed profits) 60,56,640 NIL
Balance c/f out of current
year PAT 1,42,90,150 2,36,94,951
NATURE OF BUSINESS
The Company is engaged in the business of Real Estate Development. The
Company develops residential projects. There was no change in the
nature of the business of the Company during the year under review.
During the year under review the Company finalised development of two
projects one at Kanakapura and another one at Nandi Hills.
FINANCIAL PERFORMANCE
During the year under review, the Company earned a profit before tax of
Rs. 3.28 crores as compared to Rs. 5.24 crores in the corresponding
previous year representing a decrease of 37.40%. The Company earned a
profit after tax of Rs. 2.03 crores as compared to Rs. 3.22 crores in
the previous year representing a decrease of 36.95%.
TRANSFER TO RESERVES
It is not proposed to transfer any amount out of the current profits to
General Reserve.
DIVIDEND
The Board of Directors has recommended a dividend at the rate of Re.
0.60 per equity share (i.e. 6%) for the year ended 31st March, 2015
(previous year: NIL). The proposed dividend (excluding the dividend
distribution tax) will absorb an amount of Rs. 60,56,640. The dividend
payout is subject to approval of Shareholders at the ensuing Annual
General Meeting.
The dividend will be paid to those Shareholders whose names will appear
in the Register of Members as on 22nd September, 2015 and in respect of
shares held in dematerialised form, it will be paid to Shareholders
whose names are furnished by National Securities Depository Limited and
Central Depository Services (India) Limited, as beneficial owners as on
that date.
UNCLAIMED DIVIDEND
There is no balance lying in the unpaid equity dividend account of the
Company.
ASSOCIATE AND JOINT VENTURE COMPANIES
The Company has three associate companies viz., Samruddhi Real Assets
Private Limited, Studio 3 Planners Private Limited and Samruddhi
Infratech (India) Private Limited. There are no joint venture companies
within the meaning of Section 2(6) of the Companies Act, 2013 ('the
Act').
In terms of proviso to sub-section 3 of Section 129 of the Act, the
salient features of the financial statements of the Associate Companies
is set out in the prescribed form AOC-1 (Part 'B' - Associates and
Joint Ventures) which forms part of the Annual Report.
ISSUE OF BONUS SHARES
During the year under review, the Company issued bonus equity shares in
the ratio of one equity share of Rs. 10/- each fully paid up for every
five equity shares held by the shareholders of the Company as on the
Record Date i.e., 19th September, 2014. The aggregate number of bonus
equity shares issued was 16,82,400. The allotment of these shares was
made on 20th September 2014 and they were listed and permitted to trade
in by Bombay Stock Exchange with effect from 29th September, 2014.
ISSUE OF NON CONVERTIBLE DEBENTURES (NCDs)
During the year the Company issued Non-Convertible Debentures (NCDs) by
way of private placement, aggregating to Rs. 60 crores. As on 31st
March, 2015 the aggregate amount of NCDs allotted was Rs. 21 crores.
CRISIL assigned a "CRISIL BB-/Stable" rating to these NCDs. which
reflects Company's stable financial discipline and prudence.
ALTERATION OF ARTICLES OF ASSOCIATION
The Articles of Association of the Company were altered during the year
to align with the requirements of the Companies Act, 2013 and the
Debenture Trust Deed.
INCREASE IN BORROWING POWERS
During the year under review the borrowing powers of the company were
increased to Rs. 250 Crores. This was approved by the shareholders in
the Annual General Meeting held on 9th September, 2014
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Pursuant to the provisions of Sections 149, 150, 152, Schedule IV of
the Companies Act, 2013 read with Companies (Appointment and
Qualification of Directors) Rules, 2014 and the Listing Agreement and
General Circular No. 14/2014 dated 9th June, 2014 issued by the
Ministry of Corporate Affairs, 2014 Mr. Praveen Narayanaswamy, Ms.
Sushma Thirunalpalya Somashekarappa and Mr. Srinivas Gulur
Seshagirirao, were appointed as Independent Directors of the Company
for a term of five years from 1st April, 2014 to 31st March, 2019.
Mr. Ravindra M. Madhudi retires by rotation at the forthcoming Annual
General Meeting and, being eligible, offer himself for re- appointment.
The current term of appointment of Mr. V. R. Manjunath, Mr. Hemang D.
Rawal and Mr. Ravindra M. Madhudi as Whole Time Directors' (WTDs) of
the Company will expire on 15th January, 2016. The Board of Directors
considers that for smooth and efficient running of the administrative
affairs of the Company, the services of all the three WTDs should be
available to the Company for a further period of three years with
effect from 15th January, 2016
Brief resume of these WTDs, nature of their experience in specific
functional areas, names of the companies in which they hold
directorship and membership/chairmanship of board committees,
shareholding and relationship between directors inter-se, as stipulated
under Clause 52 of the SME Equity Listing Agreement with the Stock
Exchange, are provided in the Notice for convening the Annual General
Meeting.
The Company has formalised the existing appointments of Mr. Hemang D.
Rawal (as Managing Director), Mr. Yashodhara K (as Chief Financial
Officer) and Mr. Dharmesh M. Kuvalekar (as Company Secretary), as the
Key Managerial Personnel of the Company to comply with the provisions
of Section 203 of the Companies Act, 2013.
MIGRATION FROM SME SEGMENT TO MAIN BOARD
The Company has been listed and traded on the SME Platform for more
than two years and hence eligible to migrate on to the Main Board as
per the guidelines specified by SEBI vide their circular dated 18th
May, 2010 and as per the procedures laid down under Chapter XB of SEBI
ICDR Regulations, 2009.
Listing on the Main Board of BSE Limited will take the Company into a
different league altogether with enhanced recognition and increased
participation by retail investors.
Necessary resolution for obtaining the approval of shareholders has
been incorporated in the Notice of the forthcoming Annual General
Meeting of the Company. The said resolution authorises the Board of
Directors of the Company to migrate from SME Platform to Main Board of
BSE Limited.
AUDITORS REPORT
The observations made by the Auditors in their Report referring to the
Notes forming part of the Accounts are self-explanatory and therefore,
do not require any further explanation or comments from the Board under
Section 134(3) of the Companies Act, 2013.
AUDITORS
At the 11th Annual General Meeting of the Company held on September 9,
2014 M/S. A. R. PAI & CO, Chartered Accountants were appointed as the
Statutory Auditors of the Company.
In terms of the first proviso to Section 139 of the Act read with Rule
3(7) of Companies (Audit and Auditors) Rules, 2014, the appointment of
the auditors shall be subject to ratification by the Members at every
Annual General Meeting.
In this regard, the Company has received a certificate from the
Auditors to the effect that if they are reappointed, it would be in
accordance with the provisions of Section 141 of the Act.
Necessary resolution for ratification of appointment of the said
Auditors is included in the Notice of Annual General Meeting for
seeking approval of members.
INTERNAL AUDITORS
The Board has appointed Mr. Kiran Kumar K. Chartered Accountant as the
Internal Auditor of the company for the financial year 2015-16
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 Company's financial position have
occurred between the end of the financial year of the Company and the
date of this report.
INTERNAL FINANCIAL CONTROLS
The Internal Financial Controls with reference to financial statements
as designed and implemented by the Company are adequate.
During the year under review, no material or serious observation has
been received from the Internal Auditors of the Company for
inefficiency or inadequacy of such controls.
PARTICULARS OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES
All related party transactions that were entered into during the
financial year were on an arm's length basis and were in the ordinary
course of business and that the provisions of Section 188 of the
Companies Act 2013 are not attracted. Thus disclosure in form AOC-2 is
not required. Further there are no materially significant related party
transactions made by the Company with Promoters, Directors, Key
Managerial Personnel or other designated persons which may have a
potential conflict with the interest of the Company at large.
None of the Directors has any pecuniary relationships or transactions
vis-a-vis the Company. PARTICULARS OF LOANS, GUARANTEES AND
INVESTMENTS
The details of Loans, Guarantees and Investments covered under the
provisions of Section 186 of the Companies Act 2013 are given in the
notes to the Financial Statements.
DECLARATIONS BY INDEPENDENT DIRECTORS
Pursuant to the provisions of sub-section (7) of Section 149 of the
Companies Act, 2013, the Company has received individual declarations
from all the Independent Directors confirming that they fulfil the
criteria of independence as specified in Section 149(6) of the
Companies Act, 2013.
MEETINGS OF THE BOARD
The Board of Directors met eleven times during the financial year ended
March 31,2015 in accordance with the provisions of the Companies Act,
2013 and rules made thereunder. All the Directors actively participated
in the meetings and contributed valuable inputs on the matters brought
before the Board of Directors from time to time. The details of the
meetings are given in Corporate Governance Report which forms part of
this Report.
Additionally, during the financial year ended March 31, 2015 the
Independent Directors held a separate meeting in compliance with the
requirements of Schedule IV of the Companies Act, 2013 and the Listing
Agreement.
The details of other committee meetings are given in the Corporate
Governance Report which forms part of this report.
AUDIT COMMITTEE
The Audit Committee comprises Mr. Srinivas Gulur Seshagirirao as
Chairman, Mr. Hemang D Rawal and Ms. Sushma T S as members. All the
recommendations made by the Audit Committee were accepted by the Board.
DIRECTOR'S RESPONSIBILITY STATEMENT
In terms of Section 134(5) of the Companies Act, 2013, in relation to
the audited financial statements of the Company for the year ended
March 31, 2015, 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;
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 March 31, 2015 and of the profits of the Company for
the year ended on that date;
c. proper and sufficient care was taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
d. the annual accounts of the Company have been prepared on a going
concern basis;
e. internal financial controls have been laid down to be followed by
the Company and that such internal financial controls are adequate and
were operating effectively;
f. Proper systems have been devised to ensure compliance with the
provisions of all applicable laws and that such systems were adequate
and operating effectively.
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS
The Company has a practice of conducting familiarization programme for
Independent Directors of the Company. At the time of appointment, a
formal letter of appointment is given to Independent Directors which
inter-alia explains the role, functions, duties and responsibilities
expected from them as a Director of the Company. The Company conducts
structure orientation programmes for the Independent Directors to
understand and get updates on the business and operations of the
Company on a continuous basis. Such programmes provide an opportunity
to the Independent Directors to interact with Senior Leadership team of
the Company and help them to understand the Company's strategy models,
operations services, product-offerings, finance, human resources and
such other areas as may arise from time to time.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
In compliance with the provisions of Section 177(9) the Board of
Directors of the Company has framed the "Whistle Blower Policy" as the
vigil mechanism for Directors and employees of the Company. The Whistle
Blower Policy is disclosed on the website of the Company at
www.samruddhirealty.com.
RISK MANAGEMENT POLICY
The Board of Directors of the Company has formulated a Risk Management
Policy which aims at enhancing shareholders' value and providing an
optimum risk reward trade off. The risk management approach is based on
a clear understanding of the variety of risks that the organisation
faces, disciplined risk monitoring and measurement and continuous risk
assessment and mitigation measures.
BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and the Listing
Agreement, a structured questionnaire was prepared after taking into
consideration inputs received from the Directors, covering various
aspects of the Board's functioning, composition of the Board and its
committees, culture, execution and performance of specific duties,
obligations and governance. The performance evaluation of the
Independent Directors was carried out by the entire Board. The
performance evaluation of the Chairman and the Non-Independent
Directors was carried out by the Independent Directors. The Directors
expressed their satisfaction with the evaluation process.
EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of Section 134(3)(a) of the Companies Act,
2013, extract of the Annual Return for the financial year ended March
31, 2015 made under the provisions of Section 92(3) is attached as
Annexure - 1 which forms part of this Report.
PARTICULARS OF EMPLOYEES AND REMUNERATION
During the year, there was no employee in receipt of remuneration as
prescribed in the Rule 5 (2) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014. The prescribed
particulars of Employees as required under Section 197 (12) of the Act
read with Rule 5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 is attached as Annexure - 2 and forms
part of this Report.
As on March 31, 2015 there were 69 permanent employees.
REMUNERATION AND NOMINATION POLICY
The Board has framed a policy for selection and appointment of
Directors, Senior Management and their remuneration. The details of
this Policy are attached as Annexure-3 to this report.
STATEMENT PURSUANT TO LISTING AGREEMENT
The Company's equity shares are listed at Bombay Stock Exchange
Limited, (SME segment). The Annual listing fee for the year 2015-16 has
been paid.
SECRETARIAL AUDIT
As required under the provisions of Section 204 of the Companies Act,
2013, the report in respect of the Secretarial Audit carried out by Mr.
V. C. Krishnamurthy, Practising Company Secretary in Form MR-3 for the
FY 2014-15 is attached as Annexure - 4 to this report. The said report
does not contain any adverse observation or qualification requiring
explanation or comments from the Board under Section 134(3) of the
Companies Act, 2013.
CORPORATE GOVERNANCE
The Company has complied with the mandatory provisions of Corporate
Governance as stipulated in the Listing Agreement with the Stock
Exchange. A separate report on Corporate Governance along with the
requisite Auditors' Certificate is annexed and forms part of this
Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis Report has been separately
furnished in the Annual Report. HUMAN RELATIONS
During the year employee relations continued to be cordial and
harmonious at all levels and in all divisions of the Company. There was
a total understanding of the management objectives by the employees.
The Company has consistently tried to improve its HR policies and
processes so as to acquire, nurture & retain the best of the available
talent in the Industry.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO:
Considering the Company's business activities, the Directors have
nothing to report under Section 134(3)(m) of the Companies Act, 2013
read with Rule 8(3) of the Companies (Accounts ) Rules, 2014 with
reference to Conservation of Energy & Technology Absorption.
The transaction involving foreign exchanges during the year are as
below:
(Figures in Rs.)
Particulars 2014-15 2013-14
Foreign Exchange Earnings NIL NIL
Foreign Exchange Outgo 34,44,016 51,69,624
GENERAL
Your Directors state that no disclosure or reporting is required in
respect of the following items as there were no transactions on these
items during the year under review:
* Details relating to deposits covered under Chapter V of the Act
* Disclosure relating to equity shares with differential rights
* Disclosure relating to sweat equity shares
* Disclosure relating to employee stock option scheme
* Disclosure in respect of voting rights not directly exercised by the
employees
* Disclosure of significant or material orders passed by the Regulators
or Courts or Tribunals which impact the going concern status and
Company's operations in future.
* Disclosure under Section 134(3)(o) of the Companies Act, 2013 and the
Companies (Corporate Social Responsibility Policy) Rules, 2014, since
the Company is not covered under Section 135 of the Companies Act,
2013.
DISCLOSURE UNDER THE PREVENTION OF SEXUAL HARASSMENT ACT, 2013
The Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013 (the 'said Act') has been made effective
w.e.f. December 9, 2013. It is an Act to provide protection against
sexual harassment of women at workplace and for the prevention and
redressal of complaints of sexual harassment and for matters connected
therewith or incidental thereto. The Company has constituted an
Internal Complaint Committee ('ICC') as required by the said Act. The
Company is strongly opposed to sexual harassment and employees are made
aware about the consequences of such acts and about the constitution of
ICC.
During the year under review, no complaints were filed with the
Committee under the provisions of the said Act.
ACKNOWLEDGEMENT
The Board of Directors wishes to thank the Central Government, State
Government, RBI, SEBI, and The Bombay Stock Exchange Limited (BSE) for
their co-operation in various spheres of Company's functions. The Board
of Directors expresses it's gratitude for the co-operation extended by
the Financial Institutions / Term Lenders and Company's Bankers for
their valuable support. The Directors thank all the shareholders of the
Company, its customers and investors for their valuable support during
the year and look forward to their continued support in the years to
come. The Company has also gained considerably from the sincere and
devoted services rendered by its employees at all levels. The Board of
Directors wishes to place on record its sincere appreciation of the
employee's efforts in enhancing the image of the company in the market.
On behalf of the Board
Sd/- Sd/-
Bangalore Hemang D. Rawal Ravindra M Madhudi
Date: 29.05.2015 Managing Director Whole Time Director
DIN - 00513746 DIN - 00513694
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