Description
The report for the financial year 2011 - 2012 of IL&FS transportation networks limited(ITNL).
Annual Report 2011-12
That’s ITNL for you
safe solid sustainable
Contents
the annual general Meeting will be held at y. B. chavan auditorium, gen. J. Bhosale Marg, Mumbai 400 001 on Thursday, August 9, 2012 at 3.30 pm
02-19 corporate overview
Performance Highlights Operational Highlights Building a Resurgent India Portfolio of Road Projects Projects Under Operation Projects Under Construction Projects Under Development Urban Transportation Projects Largest Private Sector BOT Road Asset Portfolio 02 04 06 08 08 12 16 18 19
20-31 strategic review
Chairman’s Message Safe Solid Sustainable Board of Directors Awards and Accolades Corporate Information 20 22 24 26 28 30 31
32-58 statutory reports
Management Discussion and Analysis Directors’ Report Report on Corporate Governance 32 44 48
Forward-looking Statements In this Annual Report, we have disclosed forwardlooking information to enable investors to comprehend our prospects and take investment decisions. This report and other statements written and oral – that we periodically make contain forward-looking statements that set out anticipated results based on the management’s plans and assumptions. We have tried wherever possible to identify such statements by using words such as ‘anticipate’, ‘estimate’, ‘expects’, ‘projects’, ‘intends’, ‘plans’, ‘believes’, and words of similar substance in connection with any discussion of future performance We cannot guarantee that these forward-looking statements will be realised, although we believe we have been prudent in assumptions. The achievements of results are subject to risks, uncertainties, and even inaccurate assumptions. Should known or unknown risks or uncertainties materialise, or should underlying assumptions prove inaccurate, actual results could vary materially from those anticipated, estimated, or projected. Readers should keep this in mind. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise
59-162 Financials
Standalone Financial Statements Auditors’ Report Balance Sheet Statement of Profit and Loss Cash Flow Statement Notes Consolidated Financial Statements Auditors’ Report Balance Sheet Statement of Profit and Loss Cash Flow Statement Notes Notice/ Attendance Slip/ Proxy Form 59-104 59 62 63 64 66 105-162 105 108 109 110 112 163
Roads are the key to realizing the dream of a developed India, the means to usher in socio-economic development and to pave the way for India’s progress
At ITNL, we are committed towards our mission of building a resurgent India and providing technological excellence to challenging projects As we go about connecting the farthest corners of India and creating a solid foundation for the future, our endeavor is also to ensure high safety levels for our teams and for the road-users Being a catalyst to community development and ensuring long-term sustainability is also a prime concern Drawing strength from our legacy, parentage and track record, we continue to strive towards nation-building on a safe, solid and sustainable foundation
Transportation
ANNuAL RepoRT 2011-12
Performance Highlights
(Consolidated Financials)
Graphs not to scale
(` million)
Revenue
eaRnIngS PeR SHaRe
(`) 57,294
24,873
41,274
cagR
13,320
38.81%
1.42
2008-09
2009-10
2010-11
2011-12
2008-09
2009-10
19.97
2010-11
22.19
2011-12
(` million) 15,894
eBITDa
neT woRTH
(` million)
8,862.14
2008-09
2,900
28.85%
2009-10
2010-11
2011-12
2008-09
2009-10
16,686.36
cagR
2010-11
22,392.21
8,785
12,335
2011-12
PRoFIT aFTeR TaX
(` million)
DeBT-equITy RaTIo
4,970
3,444
4,329
2008-09
263
2009-10
2010-11
2011-12
2008-09
2.09
cagR
14.81%
2009-10
1.99
2010-11
2.44
2011-12
2
sAfe
soLID
susTAINABLe
That’s ITNL for you
3.74
27,637.90
25.48
02 | coRpoRATe oveRvIew performance Highlights
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
neT PRoFIT MaRgInS
(%)
DaIly aveRage collecTIon (GRoss)
(` million)
14
10.67
8.5
6.98
Toll Annuity 4.91
5.87
4.91
2008-09
2
2009-10
2010-11
4
2011-12
2008-09
3.08
2009-10
2010-11
4.91 2.35
8.7
2011-12
oPeRaTIng MaRgInS
(%)
InTeReST coveR
22
30
1.66
2.99
35
28
2008-09
2009-10
2010-11
2011-12
2008-09
2009-10
2010-11
2011-12
2.18
3
Transportation
ANNuAL RepoRT 2011-12
Operational Highlights
commissioned 460 lane kms under RIDcoR phase II project
obtained provisional completion certificate for 173 lane kms of Hyderabad outer Ring Road project
obtained concessions for:
four laning of Kiratpur to ner-chowk Section of nH-21 in the state of Himachal pradesh to be executed as BoT (Toll) on DBfoT pattern under NHDp phase III constructing New Bridges/structures, Repairing of existing Highway from Kharagpur to Baleshwar section in orissa and west Bengal Developing and operating of Sikar-Bikaner Section of nH-11 Bikaner Bypass in Rajasthan through public-private partnership Developing, Design, finance, construction, operation and Maintenance of Mathura (u.P. Border) to Bhadoti in the state of Rajasthan Developing, Design, finance, construction, operation and Maintenance of Rawatsar-nowar-Bhadra roads in the state of Rajasthan Developing the existing Two Lane road to a Four lane road on Beawar gomti section of nH - 8 in the state of Rajasthan Improvement works of chaibasa-Kandra-chowk Road and adityapur - Kandra Road under the Jharkhand Accelerated Road Development programme
4
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew operational Highlights
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Acquired 61.22% equity stake in futureage Infrastructure India Limited for executing an automated car parking project of 440 car spaces in Hyderabad through charminar Robo park Limited, a subsidiary of the company
Acquired 49% equity stake in chongqing yuHe expressway company limited (through ITNL International pte. Ltd., singapore, a wholly owned subsidiary), a company based in china which has concession rights for a road project comprising 58.72 kms of 4-lane carriage way having bridges and tunnels as a part of its carriageway
obtained ISo 14001:2004 and oHSaS 18001:2007 certifications for environmental, Health and safety Management system
5
Transportation
ANNuAL RepoRT 2011-12
Building a Resurgent India
11,859 lane kms
RoaD aSSeTS PoRTFolIo
5,453 lane kms
oPeRaTIonal PoRTFolIo
Chenani - Nashri Tunnel project
IL&fs Transportation Networks Limited (ITNL) is a leading surface transportation infrastructure company and one of the largest BoT road operators, with the illustrious parentage of Infrastructure Leasing & financial services Limited (IL&fs) ITNL is involved in the development, operations and maintenance of surface transportation infrastructure projects encompassing national and state highways, roads, flyovers and bridges. ITNL has established a diverse project portfolio in the BoT road segment and made successful inroads in non-road sectors like metro rail, bus transportation and border entry points ITNL has set up an international multi-segment footprint spanning road, urban infrastructure and railways sectors ITNL has promoted and developed a large portfolio of road sector projects with a significant developmental role. ITNL will build upon its reputation for on-time project delivery within the budgeted cost and transform the face of the surface transportation infrastructure in the country through better engineering, monitoring and use of latest technology
ISO 9001:2008, ISO 14001:2004 and OHSAS 18001:2007
ceRTIFIeD
EnroutE to SuccESS
A sharply focused and strategised business model positions ITNL to seize the benefits of a robust momentum in NHAI road projects. Besides a diverse portfolio in BOT road segment, ITNL has expanded into new sub-sectors in surface transportation such as urban transportation, railways, border checkposts, parking complexes, with a vision to transform India’s surface transportation infrastructure
6
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew Building a Resurgent India
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
8, 69 9
3, 16 0
PoRTFolIo MIX (lane kms)
Annuity Toll Annuity projects form 27% of asset base
PoRTFolIo MIX (` million)
Annuity Toll
12 5, 07 4
7, 15 0
17 7, 08 0
PoRTFolIo MIX (lane kms)
National Highways Other Roads National Highways account for 40% of asset base
PoRTFolIo MIX (` million)
National Highways Other Roads
Pan InDIa PReSence
1. 2. 3. 4. 6. 8. 11. 16. 5. 7. 13. 12. 14. 15.
1. Jammu & Kashmir 2. Himachal pradesh 3. Haryana 4. Rajasthan 5. uttar pradesh 6. Gujarat 7. Madhya pradesh 8. Maharashtra
15 7, 58 3
4, 70 9
14 4, 57 1
9. Karnataka 10. Kerala 11. Andhra pradesh 12. orissa 13. Jharkhand 14. west Bengal 15. Meghalaya 16. Assam 1. usA 2. Mexico 10. Brazil 11. portugal 12. spain 13. Albania 14. Moldova 15. china 16. India 17. Thailand 3. Honduras 4. Haiti 5. The Dominican Republic 6. panama
17.
9.
10.
InTeRnaTIonal FooTPRInT
1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
14. 12. 11. 13. 16. 15.
7. columbia 8. ecuador 9. Argentina
7
Transportation
ANNuAL RepoRT 2011-12
Portfolio of Road Projects
An Ensemble of our Road Projects
projEctS undEr opEration
North Karnataka Expressway Limited
Belgaum Maharashtra Border Road
West Gujarat Expressway Limited
Jetpur Rajkot Gondal Road
Scope
Development of four lanes with service roads on both sides aggregating to approximately 472 lane kms in length between Belgaum in the state of Karnataka up to Maharashtra Border
Scope
widening of the existing Jetpur–Gondal road from two lanes to four lanes, the improvement of the existing four lanes between Gondal and Rajkot, the widening of the existing Rajkot bypass from two lanes to four lanes on the National Highway 8B and construction of service roads, with an aggregate length of approximately 389 lane kms in the state of Gujarat
concession
The concession was awarded by the NHAI on a BoT (Annuity) basis for a period of 17.5 years (including a construction period of two and a half years)
concession
The concession awarded by the NHAI on a BoT (toll) basis for a period of 20 years (including a construction period of two and a half years)
Date of Concession Agreement
November 20, 2001
Date of Project Completion
July 19, 2004
Date of Concession Agreement
March 22, 2005
Date of Project Completion
March 17, 2008
Value (` million)
5,995
Value (` million)
2,762
8
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
NoIDA Toll Bridge Company Limited
Delhi to NoIDA, uttar pradesh
Gujarat Road and Infrastructure Company Limited
vadodra-Halol Road *
Gujarat Road and Infrastructure Company Limited
Ahmedabad-Mehsana Road
Scope
Development of a toll bridge and approach roads with approximately 60 lane kms connecting Delhi to NoIDA in the state of uttar pradesh
Scope
Development of an approximately 190 lane kms on state Highway No. 87 from vadodara to Halol in the state of Gujarat
Scope
Development of an approximately 333 lane kms section of state Highway Numbers 41 and 133 from Ahmedabad to Mehsana in the state of Gujarat
concession
The concession awarded to our promoter by the New okhla Industrial Development Authority (“NoIDA”) on a BoT (Toll) basis for a period of 30 years (including a construction period of two and a half years
concession
The concession awarded to our promoter by the Government of Gujarat on a BooT (Toll) basis, which commenced from the date of signing of concession Agreement and shall extend till a period of 30 years from the operations date
concession
The concession awarded to our promoter by the Government of Gujarat on a BooT (Toll) basis, which commenced from the date of concession Agreement and shall extend for a period of 30 years from the operations date
Date of Concession Agreement
November 12, 1997
Date of Concession Agreement
october 17, 1998
Date of Concession Agreement
May 12, 1999
Date of Project Completion
february 7, 2001
Date of Project Completion
october 24, 2000
Date of Project Completion
february 20, 2003
Value (` million)
5,888
Value (` million)
1,553
Value (` million)
3,037
* This project was designated by the world Bank as a best practices example for its environment risk mitigation and social rehabilitation plan
9
Transportation
ANNuAL RepoRT 2011-12
PRojecTS unDeR oPeRaTIon
Thiruvananthapuram Road Development Company Limited
Thiruvananthapuram city Roads phase I
Andhra Pradesh Expressway Limited
Kotakatta - Kurnool Road
Rajasthan Infrastructure Development Company of Rajasthan Limited
Mega Highways project, Rajasthan phase I
Scope Scope
Development of roads with an aggregate length of approximately 51 lane kms in Thiruvananthapuram city in the state of Kerala Development of 328 lane kms connecting Kotakatta bypass to Kurnool on National Highway-7 in the state of Andhra pradesh
Scope
Development of two lane highway with paved shoulder aggregate length of 2,106 lane kms and the improvement of four corridors, connecting phalodi to Ramji-ki-Gol, Hanumangarh to Kishangarh, Alwar to sikandra, Lalsot to Kota, and Baran to Jhalwar in the state of Rajasthan
concession concession
concession awarded by the Kerala Road fund Board on a BoT (Annuity) basis for a period of 17.5 years (including an initial construction period of two and a half years) concession awarded by the NHAI on a BoT (Annuity) basis for a period of 20 years (including a construction period of two and a half years)
Date of Concession Agreement
March 20, 2006
concession
concession awarded to promoter by the Government of Rajasthan on a ppp (Toll) basis for a period of 32 years (including a construction period of two years)
Date of Concession Agreement
March 16, 2004
Date of Project Completion
september 30, 2009
Date of Project Completion
November 15, 2006
Date of Concession Agreement Value (` million)
8,710 January 17, 2006
Date of Project Completion
March 31, 2009
Value (` million)
1,116
Value (` million)
16,180
10
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Rajasthan Infrastructure Development Company of Rajasthan Limited
Mega Highways project, Rajasthan phase II
ITNL Road Infrastructure Development Company Limited
Beawar Gomti Road
East Hyderabad Expressway Limited
Hyderabad outer Ring Road
Scope Scope
Development of a two-lane highway for an aggregate length of 715 lane kms. out of which 460 lane kms have been completed for Alwar to Bhiwadi (AB), Arjunsar to pallu (Ap), Hanumangarh to sangaria (Hs) in the state of Rajasthan
Scope
Development of two lanes with an aggregate length of approximately 248 lane kms with an option to construct a four lane highway on the Beawar Gomti Highway connecting Beawar to Gomti in the state of Rajasthan
Development of eight lane access controlled expressway with an aggregate length of 173 lane kms for the section from pedda Amberpet to Bongulur in the state of Andhra pradesh
concession concession
concession awarded to promoter by the Government of Rajasthan on a ppp (Toll) basis for a period of 32 years (including a construction period of two years)
concession
concession awarded by the Department of Road Transport & Highways, Government of India, on a DBfoT (Toll) basis for an initial period of 11 years which is further extendable to 30 years in case the company exercises the option to construct a four lane highway on the stretch within seven years from the appointed date
The concession was awarded by Hyderabad urban Development Authority for a period of 15 years (including construction period of 30 months)
Date of Concession Agreement
August 3, 2007
Date of Award
february 8, 2011 september 1, 2010 April 6, 2011
Date of Project Completion
March 1, 2011
Date of Concession Agreement
April 1, 2009
Date of Project Completion
Hs - october 1, 2011 AB - December 5, 2011 Ap - January 31, 2012
Date of Project Completion
August 25, 2010
Value (` million)
4,721
Value (` million)
4,322
Value (` million)
3,510 11
Transportation
ANNuAL RepoRT 2011-12
projEctS undEr conStruction
Thiruvananthapuram Road Development Company Limited
Thiruvananthapuram city Roads (phase II and phase III)
Hazaribagh Ranchi Expressway Limited
Hazaribagh - Ranchi Road
Scope Scope
Development of roads with an aggregate length of approximately 107 lane kms in Thiruvananthapuram city in the state of Kerala in three phases - phase I, phase II and phase III Development of four lanes with an aggregate length of approximately 319 lane kms connecting Hazaribagh to Ranchi in the state of Jharkhand
concession concession
The concession for phases II and III of this project was awarded by the Kerala Road fund Board on a BoT (Annuity) basis for a period of 17.5 years (including an initial construction period of two and a half years) concession awarded by NHAI on a BoT (Annuity) basis for a period of 18 years including an initial construction period of two and a half years
Date of Concession Agreement
october 8, 2009
Date of Concession Agreement
May 1, 2009
Value (` million)
8,692
Value (` million)
2,626
12
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Pune solapur Road Development Company Limited
pune - solapur Road
Warora Chandrapur Ballarpur Toll Road Company Limited
chandrapur - warora Road
Jharkhand Road Projects Implementation Company Limited
Jharkhand Accelerated Road
Scope Scope
Development of four lanes with an aggregate length of approximately 571 lane kms on pune – solapur stretch of National Highway-9 in the state of Maharashtra Development of four lanes with an aggregate length of approximately 275 lane kms connecting warora to chandrapur to Bamni in the state of Maharashtra
Scope
Development of two lane and four lane with an aggregate length of approximately 664 lane kms connecting Ranchi Ring Road (RRR), Ranchi patratu Ramgarh (RpR), Adityapur-Kandra (AK) (four-laning) and chaibasa – Kandra – chowka (cKc) in the state of Jharkhand
concession concession
concession awarded by NHAI on a DBfoT (Toll) basis for a period of 20 years, including an initial construction period of 2.5 years concession awarded by the pwD, Government of Maharashtra on a DBfoT (Toll) basis for a period of 30 years, including an initial construction period of 3 years
concession
concession awarded by the Government of Jharkhand on a BoT (Annuity) basis for a period of 17.5 years (including construction period of 3 years)
Date of Concession Agreement
september 30, 2009
Date of Concession Agreement
March 18, 2010
Date of Concession Agreement
RRR – september 23, 2009 RpR I & II – october 14, 2009 cKc – May 28, 2011; AK – August 6, 2011
Value (` million)
14,027
Value (` million)
6,886
Value (` million)
21,347 13
Transportation
ANNuAL RepoRT 2011-12
PRojecTS unDeR conSTRucTIon
Rajasthan Infrastructure Development Company of Rajasthan Limited
Mega Highway project phase II, Rajasthan
N.A.M. Expressway Limited
Narketpalli Addanki Medarametla Road
Moradabad Bareilly Expressway Limited
Moradabad Bareilly Road
Scope Scope
Development of a two-lane highway for an aggregate length of 715 lane kms. out of which 460 lane kms have been completed and 255 lane kms are under construction for stretches Jhalawar to Jhalawar Road, Jhalawar to ujjain, Kapren to Mangrol, Khushkheda to Kasola chowk in the state of Rajasthan widening of an existing twolane carriageway to a four-lane carriageway, including the strengthening of existing carriageway by providing bituminous overlays with an aggregate length of approximately 888 lane kms from Narketpalli to Medarametla near Addanki section of sH-2 in the state of Andhra pradesh
Scope
Development of four lane of Moradabad Bareilly section of NH-24 from kms 148.00 to kms 262.000 (approx. length 522 lane kms) in the state of uttar pradesh
concession concession
concession awarded by NHAI on DBfoT (Toll) basis for a period of 25 years including an initial construction period of two and half years
concession
concession awarded on ppp (Toll) basis for a period of 32 years, including a construction period of two years
The concession for this project has been awarded by Roads & Building Department, Government of Andhra pradesh under ppp on BoT (Toll) basis for a concession period of 24 years, including an initial construction period of two and a half years
Date of Concession Agreement
february 19, 2010
Date of Award
December 21, 2009 March 30, 2010 february 1, 2011
Date of Concession Agreement
July 23, 2010
Value (` million)
19,836
Value (` million)
17,605
Value (` million)
3,798
14
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Jorabat shillong Expressway Limited
Jorabat shillong Road
Chenani Nashri Tunnelway Limited
chenani Nashri Tunnel
MP Border Checkpost Development Company Limited
24 Border checkpost
Scope
Development of four lane of Jorabatshillong (Barapani) section of NH40 from km 0.000 to km 61.800 (approximately 262 lane kms) in the state of Assam & Meghalaya
Scope
Development of four lane of chenani to Nashri section of NH-1A from km 89+00 to km 130+00 (New Alignment) of NH-1A including 9 km long tunnel (2 - Lane) with parallel escape tunnel (approximately 38 lane kms) in the state of Jammu and Kashmir
Scope
construction, up-gradation, Modernisation, Development, operation and Maintenance of 24 Border check posts across the state of Madhya pradesh
concession
concession awarded by NHAI on a DBfoT pattern under sARDp-Ne on Annuity Basis for a period of 20 years including an initial construction period of three years
concession concession
concession awarded by NHAI on DBfoT (Annuity) basis for a period of 20 years including an initial construction period of five years concession awarded by MpRDc on a BoT (user fee basis) for a period of 4,566 days including an initial construction period of 730 days
Date of Concession Agreement
July 16, 2010
Date of Concession Agreement
November 10, 2010
Date of Concession Agreement
June 28, 2010
Value (` million)
8,240
Value (` million) Value (` million)
37,200 13,500
15
Transportation
ANNuAL RepoRT 2011-12
projEctS undEr dEvElopmEnt
Kiratpur Ner Chowk Expressway Limited
Kiratpur Ner chowk Road
sikar-Bikaner Highway Limited
sikar-Bikaner Road
Jharkhand Road Projects Implementation Company Limited
Jharkhand Accelerated Road
Scope
Development of four Laning of Kiratpur to Ner-chowk section of NH-21 from km 73.200 to km 186.500 (approximately 327 lane kms) in the state of Himachal pradesh
Scope
Development and operation of sikarBikaner section from km 340.188 of NH-11 to km 557.775 of NH-11 via sikar Bypass and Bikaner Bypass from km 553.869 of NH-11 to km 267.325 of NH-89 (approximately 540 lane kms) by Two Laning with paved shoulder in the state of Rajasthan
Scope
Development of two lanes and four lane with an aggregate length of approximately 338 lane kms for various road stretches in the state of Jharkhand
concession
The concession for this project has been awarded by NHAI on a DBfoT (Toll) basis for a period of 28 years including an initial construction period of three years
concession concession
The concession for this project has been awarded by pwD Rajasthan on a DBfoT (Toll) basis for a period of 25 years including construction period of 2 years concession awarded by the Government of Jharkhand on a BoT (Annuity) basis for a period of 17.5 years (including construction period of 3 years)
Date of Concession Agreement
March 16, 2012
Date of Award
March 31, 2012
Value (` million)
15,842
Value (` million)
22,910
Value (` million)
7,100 16
sAfe soLID susTAINABLe That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Baleshwar Kharagpur Expressway Limited
Baleshwar Kharagpur Road
ITNL Road Infrastructure Development Company Limited (Four-laning)
Beawar – Gomti Road
Road Infrastructure Development Company of Rajasthan Limited
Mega Highways project phase III, Rajasthan
Scope
construction of New Bridges/ structures, Repair of existing four Lane Highway from Kharagpur to Baleshwar section of NH-60 from km 0.000 to km 119.300 (approximately 477 lane kms) in the state of orissa and west Bengal and its operation and Maintenance
Scope
Development and operation of fourlaning of the Beawar – Gomti section of National Highway No. 8 from km 58+245 to km 166+050 (approximately 216 lane kms) in the state of Rajasthan
Scope
Development of two lane highway with an aggregate length of 607 lane kms and includes the improvement of two corridors, connecting Mathura (u.p Border) to Bhadoti and Rawatsar. Nohar-Bhadra upto Haryana Border in the state of Rajasthan
concession concession
The concession for this project has been awarded by NHAI on a DBfoT (Toll) basis for a period of 24 years including construction period of 2.5 years The concession awarded by Department of Road Transport & Highways, Government of India, on a DBfoT (Toll) basis for two-laning of the project for an initial period of 11 years is extended to 30 years as concessionaire has been notified for undertaking four laning for the project
concession
concession awarded on ppp (Toll) basis for a period of 32 years, including a construction period of two years
Date of Concession Agreement
April 24, 2012
Date of Concession Agreement
April 1, 2009
Date of Award
february 22, 2012
Value (` million)
6,600
Value (` million)
12,000
Value (` million)
6,315
17
Transportation
ANNuAL RepoRT 2011-12
urban tranSportation projEctS
Vansh Nimay Infra Projects Limited
Nagpur city Bus project
Rapid MetroRail Gurgaon Limited
Gurgaon Metro Rail Link
Charminar Robo Park Limited
car parking project, charminar, Hyderabad
Scope
Mobilisation, operation and maintenance of the Nagpur city bus services in the city of Nagpur on Boo basis
Scope
Development of a approximately 4.9 km long track for an, elevated metro line on a concession basis connecting the Delhi Metro sikanderpur station on MG Road to NH-8 in Gurgaon in the state of Haryana
Scope
Development of multilevel car park in the city of Hyderabad in the state of Andhra pradesh
concession concession
concession awarded by Nagpur Municipal corporation to vansh Nimay Infra projects Limited for a period of 10 years (and renewable for another five years)
concession
concession for the project has been awarded to us by Haryana urban Development Authority for a period of 99 years, including an initial construction period of two and a half years
The concession for this project has been awarded by Greater Hyderabad Municipal corporation (GHMc) on BoT basis for a concession period of 30 years, including an initial construction period of two years
Date of Concession Agreement
february 9, 2007
Date of Concession Agreement
May 25, 2012
Date of Concession Agreement
December 9, 2009
Value (` million)
709
Value (` million)
500
Value (` million)
11,000 18
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects – A snapshot
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Largest Private Sector BOT Road Asset Portfolio
Fair mix of “annuity / assured payments” and “Toll” based projects in various stages of development
Commissioned
190 1,553 60 5,888 333 3,037 472 5,995 51 1,116 389 2,762 2,106 16,180 328 8,710 vadodara Halol 173 4,721 248 3,510 152 3,994 256 6,591 235 22,750 107 2,626 460 3,798 Hyderabad outer Ring Road
Length in lane kms project cost in ` Mn
noida Toll Bridge
Beawar gomti
ahmedabad Mehsana Road
Ramky elsamex Hyderabad Ring Road
north Karnataka expressway
a-4 autovia, Spain
Thiruvananthapuram city Roads - I
yuHe expressway, china
west gujarat expressway
Thiruvananthapuram city Roads - II
RIDcoR - I
RIDcoR - II
aP expressway
Under Construction/ Development
664 21,347 319 8,692 522 19,836 888 17,605 571 14,027 262 8,240 275 6,886 jharkhand Road Development 38 37,200 327 22,910 477 6,600 540 7,100 255 3,798 607 6,315 216 12,000 chenani nashri
Length in lane kms project cost in ` Mn
Ranchi Hazaribagh
Kiratpur ner chowk
Moradabad Bareilly
Baleshwar Kharagpur
narketpalli addanki
Sikar Bikaner
Pune Solapur
RIDcoR II
jorabat Shillong
RIDcoR III
warora chandrapur
Beawar gomti II
Graphs not to scale
19
Transportation
ANNuAL RepoRT 2011-12
Being at the fulcrum of a growth curve in India’s infrastructure industry and having achieved the largest road asset portfolio, we move ahead with renewed vigour, with a vision to build a safe, solid and sustainable India
Chairman’s Message
Dear Friends,
The year 2011-12 was fairly eventful as far as our business performance was concerned. The unstinted support of our stakeholders enabled us to achieve our targets. Being at the fulcrum of a growth curve in India’s infrastructure industry and having achieved the largest road asset portfolio, we move ahead with renewed vigour, with a vision to build a safe, solid and sustainable India The overall macro-economic challenges combined with the sluggish growth of India’s economy remain a matter of concern. However, our determination to maintain momentum helped us emerge stronger and we move forward with a vision to transform India’s surface transportation infrastructure targeted an investment of ` 41 trillion towards this segment and there is a coherent action to accelerate spending in this sector
last mile connectivity
Although India has a massive road network, the quality of roads needs significant improvement. The shortage of rail wagons and lack of last mile connectivity has contributed to roads becoming the preferred mode of transport for goods and services The government’s focus on inclusive development and emphasis on private sector participation for infrastructure development are clearly demonstrated by the steady escalation in road infrastructure projects The Government has been actively focusing on development in road infrastructure through its National Highways Development programme (NHDp) launched by the National Highways Authority of India (NHAI). Two phases of the NHDp are on the verge of completion, while upcoming projects will be awarded for phases III to vII, which together have the potential of developing approximately 33,000 kms of roads
Infrastructure: a key priority
Deepak Dasgupta Chairman Infrastructure has emerged as the backbone of India’s economy and has the ability to make the nation one of the world’s most influential economies by 2050. Therefore, India’s XIIth five year plan reinforces the government’s focus on infrastructure creation and upgradation by having
20
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew chairman’s Message
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Managing and upgrading school infrastructure and holistic empowerment of project-affiliated communities through vocational training is what we plan to achieve. our unique concept ‘computer on wheels’ received an over-whelming response from these communities and contributed immensely towards enhancing their computer knowledge and skills
year ahead
Today, we have attained a position where we can confidently say that we have successfully laid a strong foundation for a sustainable future. our expertise in project development and execution combined with our in house self sufficiency and technical skills in the areas of structures, design and operations and maintenance continues to drive business expansion. It also gives us the confidence to achieve our targets and sustain growth I am sincerely grateful to our stakeholders for trusting our capabilities and also to my colleagues on the Board and our employees for their dedication and commitment. I look forward to their continued support and trust in all our future endeavours Best wishes, Deepak Dasgupta Chairman
within ITnl
our consolidated revenues increased 39% and our net profit 15% over the previous year despite adverse market conditions and increased competition, with a majority of this contribution emanating from construction, toll and annuity. During the year, we commissioned 633 lane kilometres, taking the total lane kilometres under operation to 5,453 lane kilometres It is pertinent to mention here that we have created a strong portfolio of road development projects and we remain committed to our vision of transforming India’s surface transportation infrastructure. our bidding criteria are perfectly aligned with our objective of achieving threshold IRRs, rather than merely building on the order book
deepen long-term linkages to ensure sustainability. we focus on maintaining high levels and standards of safety at our operational sites and ensuring accident-free working conditions for our people as well as the users
Road ahead
we continue to draw immense strength from our large order pipeline. we envisage the nature of bidding to get more rational, which will augur well for the business of your company. we are confident of continuing to win more projects on bids submitted to the NHAI and to some state Governments. we also propose to increase our international presence selectively, but our focus shall remain Road centric and India centric
Key strategy
our financial credibility and technical expertise has strengthened our bidding capacity and helped us expand our operations in into other sectors besides roads. we continue to leverage our technological competence, value engineering, financial competence and innovative design capabilities to maintain our leadership position our aim is to catalyse substantial community development in the hinterland of our projects and
Beyond roads
During the year, we continued with our community development initiatives through our project Parivartan. our main focus here continues to be education.
Our expertise in project development and execution combined with our in house self sufficiency and technical skills in the areas of structures, design and operations and maintenance continues to drive business expansion
21
Transportation
ANNuAL RepoRT 2011-12
SaFe
At ITNL, we believe the route to safety is towards maintaining high levels and standards of safety at both construction and operational sites which is achieved through safety audits. This is done by ensuring accident-free working conditions for the project teams and users of the road. stringent measures are undertaken to identify and prevent accidents through safety audits
22
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew sAfe
32 | sTATuToRy RepoRTs
59 | fINANcIALs
ITNL believes in addressing occupational safety and health needs during the implementation process and works on comprehensive safety programs to make project sites safer places to work. ITNL aims to prevent work-related hazards and risks associated with construction to avoid fatalities Besides, we ensure a proper usage of personal protective equipments (ppe) to eliminate injuries from unpredicted hazards
SAFE SITE
A Periodical on “safety in Construction” - an initiative by ITNL
safety is a state of mind - Accidents are absence of mind
23
Transportation
ANNuAL RepoRT 2011-12
SolID
At ITNL, we believe the road to solidity is to deliver projects with technological and engineering excellence within the budgeted time and cost. ITNL’s technological capability, value engineering and its excellence in design engineering have been instrumental in maintaining a leadership position. Besides strengthening bidding, project management and execution capability, all these efforts have helped ITNL in expanding its operations in other areas of surface transportation infrastructure
24
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew soLID
32 | sTATuToRy RepoRTs
59 | fINANcIALs
ITNL’s vision of transforming India’s surface transportation infrastructure gains strength from the technology, experienced management and project diversity which have enhanced ITNL’s credibility as a dependable industry player construction at the 9-km long chenani-Nashri tunnel, India’s longest road tunnel project is ongoing. construction of this tunnel has been particularly challenging owing to steep mountainous terrain, bad weather conditions and safety concerns. The project has used advanced tunnelling and drilling equipments and a new Austrian Tunnelling method to sequentially excavate and support the tunnel completion of this project will be of great significance for ITNL, as it will be one of the landmark projects in ITNL’s history
25
Transportation
ANNuAL RepoRT 2011-12
SuSTaInaBle
At ITNL, we believe the road to sustainability is the development of social infrastructure. Development of transportation infrastructure is imperative for the growth of the nation, but such development needs to be balanced and sustainable from a social perspective as well
ITNL strives to catalyse substantial community development and ensure sustainability through education, employability and empowerment. ITNL believes that with quality resources, rural India will have more reason to smile. ITNL believes that education, employment generation and basic health facilities are the key transformational tools to catalyse substantial community development and deepen long-term linkages to ensure sustainability
26
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew susTAINABLe
32 | sTATuToRy RepoRTs
59 | fINANcIALs
ITNL’s unique initiative “Parivartan” focuses on efforts of improvement of education, skill development and health initiatives for communities residing close to our areas of operations to pave way for social empowerment. The move is aimed towards enhancing India’s socioeconomic prosperity and building capabilities to develop alternative means of livelihood, enhance employability and explore other possibilities ITNL has collaborated with IL&fs education & Technology services Limited for rehabilitation of communities along the National Highways of pune-solapur in Maharashtra, RanchiHazaribagh in Jharkhand, Moradabad-Bareilly in uttar pradesh and chenani-Nashri in Jammu & Kashmir Key highlights of this initiative are:
Reaching out to government schools and educational institutions at project sites, building capacities for intake of more students and teachers; and upgrading teaching methodologies and techniques Imparting mobile computer education and other IT-based trainings through parivartan computer Bus at schools and other locations along project roads undertaking school management programs aimed at improvement of schools infrastructure and training for teachers and students setting up skill development centers to train youth for employment opportunities organising health checkup camps and mobilizing mobile health van with medicos for routine checkup and basic treatment for remote villages
27
Transportation
ANNuAL RepoRT 2011-12
Board of Directors
Deepak Dasgupta
Chairman & Independent Director
Retired Indian Administrative services officer served the Government of Haryana and the central Government for over 35 years Headed various departments in the Government of Haryana and Government of India, including those related to infrastructure development and policy formulation served as the chairman of National Highways Authority of India for over five years and as an Advisor to the Asian Development Bank Member of the senior expert committee of IDfc private equity fund and the special Task force in Bihar Holds a Master’s degree in science from Delhi university developed the prestigious ‘Mumbaipune expressway’ project); and also as vice-chairman & Managing Director of Maharashtra Airport Development company Limited Holds a Bachelor’s degree in Law, Master’s degree in economics from Lucknow university and a post graduation in ‘urban Development’ from the London university
H P jamdar
Independent Director
Headed various departments of the Government of Gujarat, including as secretary and principal secretary; during his tenure, Mr. Jamdar was appointed as chairman of various state-owned corporations, especially in roads and ports sector served as the president of Indian Roads congress and the Institution of engineers (India) and as the vicepresident of ‘fIescA’
Deepak Satwalekar
Independent Director
former Managing Director and chief executive officer of HDfc standard Life Insurance company Limited; prior to this, he was the Managing Director of HDfc Limited since 1993 consultant with multi-lateral and bilateral agencies Recipient of the ‘Distinguished Alumnus Award’ from the Indian Institute of Technology, Mumbai, and is now on the Advisory council of the said Institution Also an Independent Director on the Boards of several other companies currently active on the Board of Trustees of Isha vidhya (ishavidhya. org) and Teach to Lead (teachforindia. org), engaged in the field of primary education for low income and socially disadvantaged members of the society in rural and urban India, respectively Also advising a company engaged in establishing a network of Bpo companies in rural areas across the country Holds a Bachelor’s degree in Technology from the Indian Institute of Technology, Mumbai, and a Master’s degree in Business Administration from the American university, washington Dc
Holds a Bachelor’s degree in civil engineering from the Gujarat university
Ravi Parthasarathy
Non-Executive Director
Associated with the company since January 6, 2001 and with the IL&fs Group since 1988 presently the chairman of IL&fs Group prior to joining the IL&fs Group, he served 20th century finance corporation Limited, a financial services company, as its executive Director Holds a Bachelor’s degree in science from the university of Mumbai and a post-graduate diploma in Business Administration from the Indian Institute of Management, Ahmedabad
R c Sinha
Independent Director
Retired Indian Administrative services officer; worked in various capacities in the Government of Maharashtra and Government of India Headed various departments / worked in ministries of the Government of Maharashtra, including as collector, District Magistrate, secretary and Additional chief secretary served as the Joint secretary, Ministry of Information & Broadcasting, Government of India During his tenure with the Government of Maharashtra, Mr. sinha was appointed as vice-chairman & Managing Director of Maharashtra state Road Transport corporation Limited, city Industrial Development corporation of Maharashtra Limited; vice-chairman & Managing Director of Maharashtra state Road Development corporation Limited (MsRDc) (during his tenure MsRDc
Hari Sankaran
Non-Executive Director
Associated with the company since November 29, 2000 and with the IL&fs Group since 1990 As vice chairman & Managing Director of IL&fs, he has been instrumental in developing and oversighting the business canvas of the Group
28
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew Board of Directors
32 | sTATuToRy RepoRTs
59 | fINANcIALs
possesses over 26 years of experience in research, project development, structuring, management and financing closely involved in the implementation of all the IL&fs Group Infrastructure projects participated in various High powered committees set up by the Government of India for policy and legal reforms, including as the chairman of the fccI Infrastructure committee Holds a Master’s degree in economics from the London school of economics & political science
prior to joining the IL&fs Group, Mr. Kapoor was associated with the Merchant Banking Division of ANZ Grindlays Bank as a portfolio Manager and as Head of corporate finance and equity Research department of unit Trust of India Mr. Kapoor holds a Bachelor’s degree in Arts and a Master’s degree in Business Administration from the Himachal pradesh university, shimla
In his role as the chief executive officer (Infrastructure) of IL&fs Group, he is associated with various initiatives in infrastructure, including seZs and Maritime Assets Also a member of the Management Board of IL&fs and represents the Boards of various companies within the Group prior to joining IL&fs, he was associated with the operations Research Group, Dalal consultants, Mumbai Metropolitan Region Development Authority and city and Industrial Development corporation of Maharashtra Limited Holds a Bachelor’s degree in civil engineering from Madras university and a post-graduation in ‘Development planning’ from the school of planning, Ahmedabad
Pradeep Puri
Non-Executive Director
An ex-Indian Administrative services officer
arun K Saha
Non-Executive Director
Associated with the company since January 6, 2001 and with IL&fs Group since 1988 presently the Joint Managing Director & ceo of IL&fs, overseeing activities relating to finance, operations, credit compliance and risk management of the IL&fs Group, including activities in the areas of financial services, infrastructure, asset management, distribution and management of retail assets and liabilities Holds a Master’s degree in commerce from the university of Kolkata; is an Associate Member of the Institute of chartered Accountants of India and the Institute of company secretaries of India
Held important positions in the Ministry of commerce and the Department of economic Affairs, Ministry of finance, Government of India, dealing with International Trade and Investment Also closely associated with the Noida Toll Bridge company Limited At present, he serves as the chief executive officer of Model economic Township company Limited Mr. puri holds a Master’s degree in History from Delhi university
Mukund Sapre
Executive Director
Appointed as an executive Director of the company on August 13, 2008 and has been associated with the IL&fs Group since 1992 possesses over 28 years of industry experience prior to joining the company, he was involved with international projects in philippines, Indonesia, Mexico and spain and has played a vital role in implementing the ‘High speed Rail project’ and evaluating the ‘cargo Airport project’ in Mexico Associated with engineers India Limited and Gammon India Limited Holds a Bachelor’s degree in civil engineering, a Diploma in systems Management and also in financial Management
K Ramchand
Managing Director
Appointed as Managing Director of the company on August 13, 2008 and has been associated with IL&fs Group since 1994 with over 30 years of experience in urban and transport infrastructure development sector, he has been involved in a large number of private infrastructure development initiatives, including the successful commissioning of various toll road projects in Gujarat and for the NHAI
vibhav Kapoor
Non-Executive Director
Associated with the company since December 10, 2004 and with IL&fs, the parent company, as its ‘Group chief Investment officer’ since July 1, 2002 and also heads the Group HRD policies and their implementation
29
Transportation
ANNuAL RepoRT 2011-12
Awards and Accolades
ITnl’s annual Report of 2010-11
was conferred by “The League of American professionals (LAcp) vision Award”, the world’s largest annual report competition with the following recognitions:
The platinum Award for excellence within its Industry
13th rank in the Top 100 Annual Reports worldwide
The Best Annual Report cover worldwide for the past fiscal year
Project Parivartan
under project parivartan run by the company along with IL&fs education & Technology services Limited, the sholapur Municipal corporation’s school at Daji peth was recognised for the e-Governance Award for the best IcT-enabled school of the year
30
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew Awards and Accolades |
32 | sTATuToRy RepoRTs corporate Information
59 | fINANcIALs
Corporate Information
Board of Directors
Deepak Dasgupta Chairman Ravi parthasarathy Hari sankaran Arun K saha R c sinha H p Jamdar Deepak satwalekar pradeep puri vibhav Kapoor R s chandra (upto May 18, 2012) K Ramchand Managing Director Mukund sapre Executive Director
Senior Management
K. Ramchand Managing Director Mukund sapre Executive Director Harish Mathur Chief Executive v. K. Raina (Dr.) Technical Director George cherian Chief Financial Officer Krishna Ghag Associate Vice President & Company Secretary
committees of the Board
audit committee
R c sinha Chairman Deepak Dasgupta H p Jamdar Arun K saha
auditors
Deloitte Haskins & sells chartered Accountants
Bankers
Axis Bank Limited
Shareholders’ / Investors’ grievance committee
Arun K saha Chairman K Ramchand
Registered office
The IL&fs financial centre, c-22, GBlock Bandra Kurla complex, Bandra (east) Mumbai 400 051
Remuneration committee
Deepak satwalekar Chairman Ravi parthasarathy Hari sankaran Hari sankaran Chairman Arun K saha pradeep puri K Ramchand Mukund sapre
committee of Directors
Registrar & Share Transfer agents
Link Intime India private Limited c-13, pannalal silk Mills compound L.B.s Marg, Bhandup (west), Mumbai 400 078
company Secretary
Krishna Ghag
31
Transportation
AnnuAl RepoRT 2011-12
ManageMent Discussion anD analysis
1. IndIa’s Infrastructure Industry
The importance of infrastructural growth in india and its contribution, as a catalyst, in transforming the economy has been continuously emphasized upon in the recent past. The indian Government has undertaken a slew of measures to provide ample opportunities for developing and improving infrastructure. The infrastructure deficit in the indian economy presents a substantial need for infrastructure creation. The Government has well understood that the lack of infrastructure is a stumbling block for an unhindered double-digit growth and has instituted several measures conducive for the growth of this sector. Given the capacity (financial and technical) constraints, the Government has put in place a model for infrastructure creation which forecasts financing for project implementation to be met not only through budgetary allocations, but also from private sector participation. This clearly indicates how seriously infrastructure creation is perceived by the Government The Xiith five Year plan (2012-2017) reinforces the Government’s focus on infrastructure creation and upgradation. it envisages a total investment of ` 41 trillion in the infrastructure segment in order to attain a 10% economic growth. The gap in existing infrastructure in india vis-à-vis the averages across the developed world provide a significant opportunity to support india’s growth story and also fuel it. owing to the global financial and sovereign turmoil across developed nations and the huge potential that the indian market offers, the world is looking at the indian market differently. This will not only intensify competition, but also ensure infrastructure creation in india is at par with the best in the world 32
sAfe solid susTAinAble That’s iTnl for you
The IndIan GovernmenT has underTaken a slew of measures To provIde ample opporTunITIes for developInG and ImprovInG InfrasTrucTure.
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
The ` 3000 billion national Highway development project (nHdp), covering a length of 55,000 kms, is the largest highway improvement initiative in the country.
2.
OppOrtunItIes
The success achieved so far in infrastructure development can be largely attributed to the implementation of the public private partnership (ppp) framework project development. under the ppp mode of project structuring, the delivery model becomes more effective and result-oriented. its success has also led to replication of this model across sub-sectors in infrastructure, which augers very well for ppp market players
The nHdp has witnessed a substantial part of its projects being implemented under boT basis across various phases, explained below in detail. it provides a significant opportunity for the development of national Highways, including construction of bridges, flyovers and elevated structures: i. initial phases of nHdp achieved substantial completion. Golden Quadrilateral (GQ) and phases i & ii achieved 99.85% and 81.79% completion, respectively ii. four-laning of 12,109 kms. (nHdp-iii): nHdp (phase-iii) includes upgradation of 12,109 kms (mainly 4 laning) of high density national highways through build, operate & Transfer (boT) mode for a cost of ` 806,260 million. nHdp iii comprises stretches of national Highways carrying huge volume of traffic, connecting state capitals with nHdp’s network under phases i and ii and providing connectivity to places of economic, commercial and tourist importance. Approximately, 80% of this phase iii has either achieved completion or is under implementation and effectively covers the length and breadth of the country. Tamil nadu, Maharashtra, Rajasthan, bihar and Madhya pradesh are some states that have witnessed substantial development of highways under nHdp-iii. of a total of 12,109 kms, nearly 3,342 kms have been completed, 6,314 kms are under implementation and the remaining portion is yet to be awarded Two laning of 14,799 kms. (nHdp-iv): with a view to provide balanced and equitable distribution of an improved/widened highways network, nHdp-iv envisages upgrading of 14,799 kms into 2-lane highways at an indicative cost of ` 278,000 million. This will ensure their 33
a.
roads National Highways Development Project
india’s roads have been the leading infrastructure sub-sector with national Highways Authority of india (nHAi) becoming one of the most successful highway implementing agencies in india. The ` 3000 billion national Highway development project (nHdp), covering a length of 55,000 kms, is the largest highway improvement initiative in the country. nHdp has been structured in a manner that puts in place infrastructure not only to support economic activity, but promulgate it as well The country’s road network stands at a huge 4.2 million kms, a significant portion of which consists of single-lane highways, which are likely to be taken up for expansion in the next five-year plan. The Government is also contemplating to establish a national expressways Authority of india with a mandate to develop approximately 18,000 kms of access-controlled expressways across the country. presently, the road length and their participation in ferrying the traffic is skewed. national Highways carry 40% of the total traffic, while they constitute a mere 2% of india’s road network. on the other hand, state Highways account for 18% of the road length and carry 40% of road traffic. The remaining traffic is taken up by rural roads
Transportation
AnnuAl RepoRT 2011-12
The Government has approved 1,000 kms of expressways to be developed on boT basis and to be constructed on new alignments at an indicative cost of ` 166,800 million.
v.
other Highway projects (nHdp-vii): The Government has envisaged development of ring roads, by-passes, grade separators and service roads, considered necessary for full utilisation of highway capacity as well as for enhanced safety and efficiency. A programme for development of these features has been approved by the Government at an indicative cost of ` 166,800 million. Apart from the highdensity corridors, a substantial part of national Highways network also requires development and are characterised by low density of traffic.
capacity, speed and safety can match minimum benchmarks required for national Highways. Although the overall progress of projects in phase-iv, aggregating approximately 2,549 kms, has not kept pace with other phases, last year saw significant progress. The project lengths under implementation witnessed a 3-fold increase, compared with last year iii. six-laning of 6,500 kms (nHdp-v): under nHdp-v, six-laning of 4-lane highways comprising the GQ and other high-density stretches will be implemented on boT basis for an estimated cost of ` 412,100 million. These corridors have been four-laned as a part of GQ in phase-i of nHdp implementation of the . initial set of projects has already commenced with 818 kms having achieved six-laning. of the 6,500 kms proposed under nHdp-v, about 5,700 kms will be taken up in GQ, while the balance 800 kms will be selected on the basis of predefined eligibility criteria, with a 10% maximum viability Gap funding (vGf). Approximately, 3,581 kms is operational/under construction, as in february 2012 iv. development of 1,000 kms expressways (nHdp-vi): with the growing importance of urban centres in india, particularly those located within a few hundred kms of each other, expressways are both viable and beneficial. The Government has approved 1,000 kms of expressways to be developed on boT basis and to be constructed on new alignments at an indicative cost of ` 166,800 million. nHAi has planned to achieve completion of this phase by december 2015 vi.
some of these stretches fall in backward and inaccessible areas, while some others are of strategic importance special Accelerated Road development programme for the north eastern Region (sARdp-ne): The Ministry has taken up the special Accelerated Road development programme in the north-eastern Region (sARdp-ne) involving widening of 10,141 kms of national Highways and other roads in three phases. This will ensure connectivity of 88 district headquarters in the region to the national Highways The Mumbai Trans Harbour link connecting sewri (Mumbai) to nhava sheva (navi Mumbai) is a significant project being undertaken at an estimated cost of ` 88,000 million. This will be undertaken on boT basis, with the private sector providing funds for its development. The project evinced wide interest from the private sector, with 6 consortia submitting the pre-qualification data, which the Mumbai Metropolitan Regional development Authority (MMRdA) is currently evaluating
Annual Qualification & E-Tendering for projects awarded by NHAI
nHAi has completed its Annual prequalification process, with over 100 applicants having been prequalified. The Annual prequalification process has enabled reducing of the turnaround time spent for the bidding process. This will lead to expediting the award and also reducing the applicants’ efforts, thus enabling them to submit more competitive bids. nHAi has also commenced the e-tendering
34
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
procedure, which has reduced the time spent by bidders in preparation and submission of bids, thereby increasing efficiency of the bidding process
the Xiith five Year plan is to establish a framework for developing and implementing rail transit systems. it is envisaged that a national urban Rail Transit corporation will be set up, responsible for advising state Governments in implementing the Mass Rapid Transit system (MRTs). upgradation of stations and establishment of logistic parks continue to be the Government’s priority The dedicated freight corridor, which aims to connect north india with Mumbai and west bengal, is expected to cost approximately ` 4,000 billion. A series of airports, parks, power plants, etc, too, have
O&M Projects
nHAi has initiated the process for awarding various national Highway stretches on operate, Maintain & Transfer (oMT) contracts. This segment is likely to gain momentum as these stretches (completed under various nHdps) are likely to come up for bidding for improvements and maintenance
State Level Initiatives
state Highways attract a significantly lesser proportion of boT projects, as compared with national Highways. Approximately, 17% of state Highway projects are on boT mode, compared with 73% of national Highways being implemented on this basis. so far, state Roads were financed significantly through budgetary allocations and state Governments are increasingly focussing on improvement of state roads. between 2011-12 and 2015-16, the length of roads and highways upgraded/ constructed is expected to grow at an average 8 per cent. private sector participation in state roads is likely to increase gradually over the next 5 years. between 2011-12 and 2015-16, total investments in state roads are expected to rise by an average 13 per cent, with state Governments increasing their focus on state road programmes. The Government has initiated model bidding documents for state Highways, which is intended to increase their share on ppp basis and provide them with much-needed impetus. states like Gujarat and Rajasthan have been at the forefront of such initiatives
been planned as a part of the infrastructure creation effort. development of an eastern freight corridor has also been proposed to ease the movement of coal and other commodities and to facilitate container movements The budget document of indian Railways for 2012-13 has a provision for setting up indian Railway station development corporation to undertake the following projects to attract private investment through ppp mode:wagon leasing, sidings, private freight
Terminals, container Train operations, Rail connectivity projects (R3i and R2c-i) development of elevated rail corridor from churchgate to virar feasibility study for construction of faster corridor on virar-vasai-diva-panvel
B.
railways
indian Railways, with its wide-reaching network, is one of Asia’s largest railway networks and the world’s second-largest under a single management. being capital intensive, railway projects are mostly funded by budgetary provisions/allocations of the Government. in the last few years, Railways have, lost a significant share of commercial traffic to state Highways and are lagging behind the Highway sector, which has become a leader in the infrastructure development arena. The Xith five Year plan had envisaged a total investment of about ` 200.8 billion in the infrastructure sub-segment, presenting an enormous opportunity. The focus of
35
Transportation
AnnuAl RepoRT 2011-12
in addition to the work being undertaken by itself, the Government is also judiciously pursuing a policy to allow the private sector to participate in development, finance, construction and operation of Metro Railway projects. in the past eight years, several Metro Rail projects have been awarded to private companies on a ppp basis. Most significant amongst these are the Mumbai one project, the Mumbai line 2 project, the Hyderabad Metro, the delhi Airport express line and the Rapid MetroRail Gurgaon project. barring the Mumbai line 2 project, all others projects have achieved financial closure and are either under construction or already in operation. several other projects are expected to be awarded on ppp basis in select cities. Though the ppp market represents only a fraction of projects undertaken by the private sector as a whole, it presents a good opportunity for private sector companies to create assets in partnership with state Governments following Metro Rail projects have been announced by the Government:
subsidiary, il&fs Rail limited, has teamed up with scomi, a leading monorail supplier from Malaysia and submitted qualification documents
(iii) Delhi Monorail
The Government of delhi has announced its intention to build 11 kms monorail system to connect the existing delhi Metro system in west and north delhi. The monorail is expected to be a feeder to delhi Metro system. The company alongwith its subsidiary, il&fs Rail limited, is in discussion with scomi to partner in this project besides these opportunities, there are several other projects being planned in various cities across india, such as chandigarh, Jaipur, patna, Trivandrum and cochin. These are in the feasibility stage and awaiting government approvals
3.
threats
Threats are likely to arise either from major policy changes by the Government or security-related developments in a specific region. some possible threats are mentioned below:
(i) Rapid MetroRail Gurgaon Extension
The Government of Haryana has decided to extend the Rapid MetroRail system to reach a total network capacity of 20 kms. The company alongwith its subsidiary, il&fs Rail limited, has already submitted a proposal
Business environment changes:
The infrastructure business is hugely prone to policy changes and is impacted substantially by changes and modifications. The threat emanates from the long gestation period in the infrastructure business. infrastructure has a huge socio-economic impact and the government must remain aware of this aspect at
(ii) Chennai Monorail
The Government of Tamil nadu has planned to build 57 kms monorail system in chennai, in addition to the chennai Metro presently under implementation. The company alongwith its
36
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
all times. Government policies have been consistent in the Highway segment and have encouraged private sector participation. The significant progress made in the Highway sector is largely attributable to the consistency retained by the government at state and central level. plans for growth of this sector indicate government’s expectations from private sector investment. Any significant change will have an impact on private sector participation, though likelihood of significant changes in business environment are negligible
segment, such as Roads, urban Transport, Railways and development of border check posts. The company has a large and diversified boT Road Asset portfolio and is well poised to reap the benefits of economic growth. The company has ventured into new business areas like border check posts and new geographies in the last year. its capabilities in providing an end-to-end solution for infrastructure creation make it an integrated player in the infrastructure development arena
a.
roads
The financial Year ended March 31, 2012 augured well for the company and it was a year of several firsts. The year saw the company venturing into new locations, both in india and abroad. The company was awarded two new projects by nHAi and one project by pwd Rajasthan. The company acquired a 49% stake in chongqing YuHe expressway company limited, an expressway project located in chongqing in south western china through its subsidiary, iTnl international pte ltd, singapore. besides, there were also additions to its portfolio under Mega Highways project in Rajasthan and Jharkhand Road development programme. The company holds beneficial interest in these projects. The company was able to financially close one of its projects and also raise funds for the acquisition of equity stake in chongqing YuHe expressway company limited
selection criteria:
The current selection criterion for project awards is based on qualification of participants, which is dependent on identified technical and financial criteria. companies desirous of participation are required to submit their credentials for being qualified. The company possesses the required strength for qualifying for all categories of projects in the pipeline. The company has been qualified by nHAi under its annual pre-qualification process
force Majeure threats:
A force Majeure event can lead to abandonment of a project located anywhere in the country. However, all agreements the company has entered into provide risk cover in such circumstances, leading to no significant financial impact. such events have been appropriately covered under insurance policies and Agreements entered into by the company have covered these eventualities
change in Law:
if change in law leads to an impact on infrastructure projects, the concessionaire is insulated from any adverse impact arising from such change in law by the concession Agreement
Additionally:
i. The company was awarded a project for four laning of Kiratpur to ner-chowk section of nH21 from Km 73.200 to Km 186.500 in the state of Himachal pradesh to be executed as boT (Toll) on dbfoT pattern under nHdp phase-iii. The project is on toll basis with a concession period of 28 years, including construction period of 3 years and its estimated cost is ` 22,910 million. The project achieved financial closure on March 29, 2012 ii. The company was awarded the project for construction of new bridges/structures, Repair of existing four lane Highway from Kharagpur to baleshwar section of nH-60 from Km 0.000 to Km 119.300 in the state of orissa and west bengal, including operation & Maintenance to be executed as boT (Toll) on dbfoT pattern under nHdp phase-i. The project is on Toll 37
credit availability:
driven by the push accorded to infrastructure projects on ppp basis, a large number of infrastructure sub-segments seek project financing from banks and financial institutions. The demand arising out of significant requirements of the infrastructure segment may cause institutions appraising them to impose stringent guidelines. The company has a good track record with infrastructure financiers, which ensures projects achieve financial closure
4.
sectOr-wIse perfOrMance
The company has a significant presence in different business verticals in the surface transportation
Transportation
AnnuAl RepoRT 2011-12
basis with a concession period of 24 years, including construction period of 2.5 years. As per nHAi, the estimated project cost will be ` 4,710.5 million iii. The company was awarded the project for development and operation of sikar-bikaner section of nH-11 (Km 340.188 to Km 557.775 via sikar by-pass) and bikaner by-pass from Km 553.869 of nH-11 to Km 267.325 of nH-89 in the state of Rajasthan through public private partnership on design, build, finance, operate and Transfer (dbfoT) basis. The project is on Toll basis with a concession period of 25 years, including construction period of 2 years. As per the public works department, Rajasthan (the “Authority”), the estimated cost of the project is ` 6,508.4 million iv. on december 28, 2011, iTnl international pte. ltd., singapore acquired 49% equity stake in chongqing YuHe expressway company limited, based in china. The project comprises 58.72 Kms of 4-lane carriageway constructed at a cost of RMb 3.5 billion and has bridges and tunnels as a part of its carriageway. The concession period for the project is 30 years of which the residual concession period is 20.5 years. The revenues accrue to the project spv from subsidy and Toll collection v. The company had signed a concession Agreement on April 1, 2009 with Ministry of Road Transport and Highways (MoRTH), Government of india for development and operation of the existing two-lane road from Km 58.245 to Km 177.050 (approximately 116.433 km) on the beawar Gomti section of national Highway no. 8 in the state of Rajasthan on dbfoT (Toll) basis. The provisional completion certificate for the project was issued on August 24, 2010 and the toll collection commenced from August 25, 2010. The concession Agreement also provided for undertaking construction of the four-laning of the project by the concessionaire, iTnl Road infrastructure development company limited, a whollyowned subsidiary of the company. MoRTH has decided to entrust the work for construction of four-laning of the project by iTnl Road vi.
infrastructure development company limited. The estimated cost of the project is ` 12,000 million. The concession period for the project will stand extended from the present 11 years to 30 years from the Appointed date i.e. from october 28, 2009 The company was entrusted with the following projects under the Mega Highway development project in Rajasthan: a) development, design, finance,
construction, operation and Maintenance of Mathura (u.p border) to bhadoti in . Rajasthan by RidcoR on dbfoT (Toll) basis. The estimated project cost is ` 3,875.2 million and Government of Rajasthan will provide a soft loan of ` 1,162.6 million b) development, of design, finance, roads in
construction, operation and Maintenance Rawatsar-nowar-bhadra Rajasthan by RidcoR on dbfoT (Toll) basis. The estimated project cost is ` 2,237.4 million. The Government of Rajasthan will provide a soft loan of ` 447.5 million vii. The company is carrying out the operations and Maintenance activities of the following road projects and maintaining them, as per norms prescribed under the concession Agreements: The Kotakatta by-pass–Kurnool project in Andhra pradesh The Jetpur–Gondal–Rajkot project in Gujarat The belgaum–Maharashtra border project in Karnataka The The Thiruvananthapuram Ahmedabad–Mehsana city Road in improvement project in Kerala project Gujarat The vadodara–Halol project in Gujarat various road stretches project under phase Mega i in Highways Rajasthan viii. under the Jharkhand Accelerated (JARdp), Road the Road
development
programme
38
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
company has been entrusted with two projects, in addition to the three it is already developing. The two new projects are: improvement works of chaibasa-Kandra-chowk Road and Adityapur – Kandra Road, aggregating 198 lane-kms with a concession period of 17.5 & 15.75 years, respectively. The total project cost together is ` 7,330 million ix. The company is currently associated with 50 proposals with various project awarding authorities aggregating 5,357 kms, which are under various stages of development
5.
rIsks & cOncerns
india’s infrastructure industry has tremendous scope to accommodate private partnerships. The Management is positive about the company’s longterm outlook and has a proven capability to assess and manage business risks. in the current economic environment, the company perceives the following risks and concerns:
(1) Market competition:
Roads have been the most progressive of the infrastructure sub-sectors, which has led to increased competition from indian as well as international companies. considering the increasingly competitive market the company operates in, its improved strategy, processes and systems are continuously modified to differentiate and ensure a robust and thriving business models
b.
urban transport :
(i) vansh nimay infraprojects limited (vnil), a subsidiary, is operating a bus service in the city of nagpur, Maharashtra, under a concession from the nagpur Municipal corporation (nMc) for a period of 10 years. currently, the company is operating 470 buses in the city of nagpur Rapid MetroRail Gurgaon limited, a subsidiary, commenced execution of the 5.1 Kms elevated metro rail loop line, connecting sikanderpur station of delhi Metro to the central business district of Gurgaon through dlf cyber city at an estimated cost of ` 10,800 million. The project achieved financial closure in June, 2010 and construction activity commenced in december 2010. As of this month, more than 50% of construction and fabrication work has been completed at the site and at the manufacturing plants. The system is expected to commence commissioning in october 2012, and will receive all permits and clearances from the authorities by March 2013, to commence commercial operation
(2) slowdown in Government spending:
The projections made in the Xith five Year plan estimated the total infrastructure spend at ` 21 trillion, which is expected to be increased to ` 41 trillion during the Xiith five Year plan. The Government expects almost 50% of the above target to be met through private sector participation. considering the substantial infrastructure gap and the huge positive impact infrastructure growth can have on the economy’s overall development, government spending is unlikely to witness a slowdown in the near future
(ii)
The investment commitment (net of advances) as on March 31, 2012, is Rs 11,757.95 million for all the aforesaid projects. This amount will be infused in accordance with the provisions of the financing arrangements to be entered into for each respective project. Typically, lenders ask for infusion of around 40% to 50% of the equity commitment upfront and the balance in accordance with construction progression on reaching a certain specified debtequity level. This investment commitment is, therefore, expected to be infused into respective projects in the next 2-3 years
39
Transportation
AnnuAl RepoRT 2011-12
(3) delay in Government clearances / approvals for projects:
The company understands the importance of attaining timely approvals and clearances for its projects to achieve a smoother execution. The company accords assistance to the various concessioning Authorities for facilitation of clearances. The main document for project is the concession Agreement, which provides risk mitigation and timelines for obtaining clearances
increase in prices. The company has put in place a system whereby contractors and the company share increase in costs in order to sustain quality objectives
(6) force Majeure
force Majeure risks have been mitigated by obtaining adequate insurance cover for the company. Also, the concession Agreement has provisions for extension to offset losses incurred by the concessionaire due to force majeure events. The concession Agreement provides protection to the concessionaire with no adverse impact and subsequently avails refinancing/ structured financial products to reduce such costs
(4) retention of experienced Manpower:
The company encourages a culture that develops and empowers people, promotes team building, nurtures individuals and uses good people practices to support HR processes and initiatives. The company continues to undertake various initiatives for development of Human Resources and to maintain a healthy and harmonious relationship within the organisation The company lays great emphasis on optimizing performance through various processes. some of these are: attracting good talent and moves through learning & development, engagement and sustaining high motivation levels of people through attractive rewards and recognition
(7) Increased cost of Borrowings
The nature of the company’s business requires it to borrow from banks/financial institutions for project financing. while formulating its strategy for the proposals, the company examines possible solutions to factor in increased cost of borrowing and mitigating its impact
6.
OutLOOk:
inclusive development has been a key concern for the indian Government, which can be achieved by broad-based infrastructure creation, connecting various parts of the country. This augurs well for the private sector to partner with the Government to consistently develop infrastructure and reduce the infrastructure deficit. The company has a diverse asset portfolio which positions it uniquely for leveraging the emerging opportunities The company is extremely optimistic that its portfolio of projects will significantly improve its
(5) Price Inflation Risk:
input materials comprise a substantial component of construction cost. over the years, the company has developed in-house capabilities for accurate and reliable cost estimation. The bidding department, while preparing for the project in report, employs mechanisms factoring inflation-related
40
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
financial performance. it is also targeting large-sized highway projects in india and in the international arena The company is also closely monitoring investments made in boT projects and constantly reviewing and strengthening its systems and procedures. it has also obtained iso 9001:2008 certification. during the year, the company was also awarded iso 14001:2004 and oHsAs 18001:2007 certifications for its environmental, Health and safety Management system The company is optimistic about the growth of india’s infrastructure industry and its ability to achieve targets on account of: number of projects in its order book; robust pipeline arising from priority accorded to infrastructure development; strong, efficient and skilled workforce; and continuing support from bankers
As a result of business growth, there has been an increase in employee cost and general administration arising from increased head count financing cost increased by ` 1,101 million as a result of higher borrowings to fund higher level of operations and also on account of continuous rise in interest rates. The debt-equity ratio as at March 31, 2012 stood at 1.40 : 1 As a result of the above, profit before tax reduced from ` 4,517.39 million during 2010-11 to ` 4,136.48 million during 2011-12, a decline of 8.43%. The average rate of tax applicable increased to 39% from 36% as a result of disallowance of interest considered on borrowed funds invested in equity. consequently, profit after tax reduced from ` 2,880.36 million to ` 2,522.98 million during 201112, a decline of 12.41% earnings per share on basic and diluted basis stood at ` 12.99 per share as at March 31, 2012 as against ` 14.83 per share as at March 31, 2011 translating into a price to earnings ratio of 14.86 times as against 15.84 times as on March 31, 2011. The price to book ratio was 1.93 times, compared with 2.56 times
7.
dIscussIOn On fInancIaL perfOrMance wIth respect tO OperatIOnaL perfOrMance standalone
during the financial Year 2011-12, the company’s turnover increased by 71% to ` 29,102.46 million, up from ` 17,009.80 million in financial Year 2010-11. This is on account of the increase in construction activity in existing projects. This is also a result of the rise in number of projects in which construction activity was undertaken, which rose from 6 in 2010-11 to 8 in 2011-12 This has resulted in a consequential increase in construction costs. There is an increase in the operation & Maintenance expenditure since expenditure was incurred during the full year for all the projects, as against part of the year during 2010-11. other key operating data for the year comprises the following: earnings before interest, Tax, depreciation and Amortization increased from ` 6,170.55 million in 2010-11 to ` 6,898.51 million in 2011-12, registering an increase of 11.80%. However, ebiTdA margin reduced from 36% to 24% mainly as a result of the change in composition of revenues, with lower margin construction revenues making up almost 77% of total revenues as against 62% in 2010-11
consolidated
during financial Year 2011-12, consolidated revenues increased 39% to ` 57,294.28 million from ` 41,268.54 million over the previous year. This was largely on account of the increase in construction activity in existing projects and also increase in number of projects in which construction activity was undertaken. The latter rose from 6 in 2010-11 to 8 in 2011-12, resulting in a consequential increase in construction and other costs earnings before interest, Tax, depreciation and Amortization increased to ` 15,893.56 million in 2011-12, up from ` 12,334.66 million in 2010-11, an increase of 29%. However, ebiTdA margin reduced marginally from 30% in 2010-11 to 28% in 2011-12. This was mainly as a result of the change in composition of revenues, with lower margin construction revenues making up almost 72% of total revenues, as against 67% in 2010-11 As a result of growth in business, there has been an increase in employee costs and general administration arising from increased head count financing cost increased by ` 2,301 million during 2011-12 due to higher draw down of debt in project spvs to fund higher level of construction activity and 41
Transportation
AnnuAl RepoRT 2011-12
also on account of increase in interest rates during the year. debt equity ratio as at March 31, 2012 on a consolidated basis stood at 3.70: 1 profit before tax increased to ` 7,845.97 million in 2011-12 from ` 6,739.78 million in 2010-11, registering an increase of 16.41% as a result of factors outlined in preceding paragraphs. Average rate of tax during 2011-12 fell to 31% from 33% primarily on account of recognition of a deferred tax asset on unabsorbed depreciation in one of the subsidiary companies. profit after tax increased to ` 4,969.58 million in 2011-12 from ` 4,328.79 million in 2010-11, an increase of 14.80% earnings per share on basic and diluted basis stood at ` 25.48 per share as at March 31, 2012, as against ` 22.19 per share in the previous year, translating into a price to earnings ratio of 7.58 times as on March 31, 2012 as against 10.59 times in the previous year. price to book ratio was 1.36 times against 2.04 times as at March 31, 2011
8.
huMan resOurces and IndustrIaL reLatIOns
The company is driven by its dynamic workforce, imbued by the spirit of keeping the organization as an industry frontrunner. The company’s focus is to build an organization of highly-motivated employees, with the ability to execute ambitious business goals with acute passion and commitment The company has formulated an attractive reward and compensation structure to sustain high motivation levels of its workforce. besides, its scalable recruitment and retention strategy enables it to attract and retain high caliber employees The company encourages its employees to
participate in various development programmes conducted at all levels. This can be done by using internal resources and /or engaging external facilitators / trainers for upgrading employee skills-sets on a periodic basis and enabling them to compete with unpredictable challenges ahead Training programmes attended by employees during the year are:
sr. no. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21.
training programme / seminars / workshops seminar on insurance Awareness Recent changes in service Tax law and procedures conference on Tunnel construction in india Road safety & Traffic Management conference on “4th national india Roads 2011” seminar on Transfer pricing Tunnel design and construction Asia 2011 public private partnership in Road and Transport infrastructure un decade of Action plan on Road safety workshop on project finance conference on public private partnership in national Highways infra conclave Rajasthan 2011 design, construction and Maintenance of flexible pavements Rigid pavements: design, construction & Quality control Aspects bridge diagnostics, performance, evaluation and Rehabilitation Reliability based design - pile & deep foundation intensive Training on Guarantees, standby letters of credits & letters of credits seminar on practical issues in indirect Tax conference on Road infrastructure in india 2011 Tunnels and underground construction in india conference on operation, Maintenance and Tolling in Road sector conference on foundation and piling works for infrastructure in india
42
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
sr. no. 22. 23. 24. 25. 26. 27. 28.
training programme / seminars / workshops international summit on public private partnership in Roads & Highways iRf General Assembly Meetings & 2012 inter traffic Amsterdam – international Trade fair And seminar 5th indian Roads conference 2012 Advanced cost engineering & strategic cost Management for infrastructure projects Airport development and Modernisation public private partnership conference at Abu dhabi financing of Road projects
9.
cautIOnary stateMent
certain statements made in the Management discussion and Analysis Report relating to the company’s objectives, projections, outlook, expectations, estimates and others may constitute ‘forward looking statements’ within the meaning of applicable laws and regulations. Actual results may differ from such expectations, projections and so on whether express or implied. several factors could make significant difference to the company’s operations. These include climatic conditions and economic conditions affecting demand and supply, government regulations and taxation, natural calamities and so on over which the company does not have any direct control
43
Transportation
AnnuAl RepoRT 2011-12
DiRectoRs’ RePoRt
The shareholders
IL&fs transportation networks Limited
Your directors have pleasure in presenting the Twelfth Annual Report alongwith the Audited statements of Accounts for the year ended March 31, 2012
fInancIaL resuLts
The financial results of the company are as under: (` in million) for the year ended March 31, 2012 Total income earnings before interest, Tax, depreciation and Amortisation (ebiTdA) profit before Tax profit After Tax balance brought forward profit available for appropriation Appropriation: dividend proposed/paid Tax on dividend General Reserve balance carried forward (777.07) (126.06) (252.30) 6,183.90 (679.94) (110.30) (288.04) 4,816.35 29,102.46 6,898.51 for the year ended March 31, 2011 17,009.80 6,170.55
4,136.48 2,522.98 4,816.35 7,339.33
4,517.39 2,880.36 3,014.27 5,894.63
The Board of dIrecTors has recommended a fInal dIvIdend of ` 4 per equITy share of The face value of ` 10/- each for The fInancIal year ended march 31, 2012.
44
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs directors’ Report
59 | finAnciAls
Your company continues to maintain its leading position in the surface Transport sector with 28 projects in its portfolio in various stages aggregating to around 11,859 lane kms (including around 2,621 lane kms in respect of which your company is the lowest/preferred bidder
dIVIdend
Your directors have recommended payment of dividend of ` 4 per share (previous Year: ` 3.50 per share) for the year under review. The proposed dividend, if approved at the Annual General Meeting, will absorb a sum of ` 903.13 million including tax on dividend of ` 126.06 million (previous Year: ` 790.24 million including dividend tax of ` 110.30 million)
Rajasthan. Also, Government of Rajasthan awarded 2 projects to RidcoR, aggregating to 303.50 kms with a total project cost of ` 22.89 billion nHAi, the key highway implementation arm of the Government of india has implemented the e-tendering process for price proposals and have continued with the annual pre-qualification of bidders. This has led to a substantial reduction in the effort required for bid submission. in the annual pre-qualification process undertaken by nHAi, the company has been qualified to bid for projects having an estimated cost of upto ` 53,592.9 million, which enables the company to participate in virtually all projects on its own Your company through iTnl international pte ltd, singapore (iipl), a wholly owned subsidiary acquired 49% equity stake in chongqing YuHe expressway company ltd, which owns a 58 km expressway connecting downtown chongqing with Hechuan county in chongqing, in the people’s Republic of china with toll concession rights till June 2032 The company also acquired a 61.22% equity stake in futureage infrastructure india limited (fiil) for developing an Automated car parking facility for about 440 cars, at Hyderabad in the vicinity of charminar. Amongst the other sectors of transport in the ambit of the company, construction on the Rail project in Gurgaon continued during the financial year. The urban bus Transport system in the city of nagpur continued its slow progress elsamex is following up for contracts in Abu dhabi and Mexico and continues to have orders in operations & Maintenance of Roads & buildings in spain that are at levels similar to that in the previous year. A number of other leads are being pursued and efforts are being made to stabilise the operations. elsamex has signed a contract for Road Rehabilitation works in Haiti for euro 40.72 45
perfOrMance reVIew
Your company continues to maintain its leading position in the surface Transport sector with 28 projects in its portfolio in various stages aggregating to around 11,859 lane kms (including around 2,621 lane kms in respect of which your company is the lowest/preferred bidder). during the year gone by, the company operationalised 460 lane kms under RidcoR phase ii projects, received provisional completion certificate for 173 lane kms of the eHel project and added 235 lane kms to its portfolio by acquisition of 49% stake in Yuhe expressway company through iTnl international pte ltd., a wholly owned subsidiary in singapore. As at March 31, 2012, 14 projects have been operational with an aggregate length of approximately 5,453 lane kms fY 2012 witnessed a spurt in the award of projects by the Government with emphasis on the ppp route. The Government, through its various instrumentalities awarded 7,957 kms in 62 projects, which is an improvement of 54% over the previous year. This comprises of 6,491 km by nHAi (49 projects) and 1,466 kms (13 projects) by Ministry of Road Transport and Highways. The company was awarded 2 projects by nHAi, namely, Kiratpur ner chowk project in the state of Himachal pradesh and baleshwar Kharagpur Road project in the states of west bengal and orrisa. in addition to these, the company was also awarded the development and operation of sikar – bikaner stretch of nH 11, a project of 237.57 kms with a project cost of ` 6.51 billion by nH division, pwd,
Transportation
AnnuAl RepoRT 2011-12
fY 2012 witnessed a spurt in the award of projects by the Government with emphasis on the ppp route. The Government, through its various instrumentalities awarded 7,957 kms in 62 projects, which is an improvement of 54% over the previous year.
million in January 2012. This project is being funded by the european union. The profit after tax for fY2012 stands at euro 1.97 million Your company has adopted two of elsamex’s
attached with this Annual Report. However, the accounts of the subsidiaries will be made available on the website of the company and on request, for inspection to shareholders seeking such information, at the Registered office of the company
dIrectOrs
Mr. deepak dasgupta, Mr. deepak satwalekar, Mr. vibhav Kapoor and Mr. pradeep puri, directors are liable to retire by rotation at the forthcoming Annual General Meeting of the company and being eligible offer themselves for re-appointment. Your directors recommend their reappointment
audItOrs
Messrs deloitte Haskins & sells, chartered Accountants, statutory Auditors, retire at the ensuing Annual General Meeting and have expressed their willingness to continue as statutory Auditors, if re-appointed
technologies viz “Micro surfacing” and “warm Mix Asphalt Technology” which are environmental friendly and specifically designed to reduce energy consumption Your company closely monitors investments made in the boT projects and continuously reviews and strengthens its systems and procedures and has obtained iso 9001:2008 certification. during the year under review, your company was also awarded iso 14001:2004 and oHsAs 18001:2007 certifications for its environmental,Health and safety Management system
depOsIts
Your company has not accepted any fixed deposits during the year under review
cOrpOrate GOVernance
Your company believes in adhering to good governance practices and has fully complied with the requirements/ disclosures that have to be made in this regard. A Report on corporate Governance is enclosed and forms part of this Annual Report. A certificate from the statutory Auditors on compliance with the provisions of corporate Governance is also annexed to this Report
suBsIdIarIes
The consolidated financial statements have been prepared in accordance with the Accounting standards 21, 23 and 27 of the institute of chartered Accountants of india. As required under section 212(8) of the companies Act, 1956, the statement of holdings in subsidiaries and consolidated Accounts pursuant to Accounting standard (As-21) issued by the institute of chartered Accountants of india, form part of the Annual Report. in terms of the notification dated february 8, 2011 issued by the Ministry of corporate Affairs (McA), amending section 212 of the companies Act, 1956, the board of directors of the company at its Meeting held on May 4, 2012 noted the provisions of the circular of the McA and passed the necessary resolution granting the requisite approvals for not attaching a copy of the balance sheet, profit and loss Account and Reports etc of the subsidiaries along with the Annual Report of the company for the financial year 2011-12. The disclosure relating to financials of the subsidiaries is included in the consolidated balance sheet. The accounts of subsidiary companies are therefore not 46
sAfe solid susTAinAble That’s iTnl for you
enVIrOnMentaL and sOcIaL pOLIcy fraMewOrk
in its pursuit of following the best business practices, your company has adopted the environmental and social policy framework (espf) to address the environmental and social risks associated with the business of the company. espf has been founded on the concept of sustainable development and recognises environmental and social (e&s) considerations in its business operations so as to add value and minimise any adverse impact and risks on the business. Your company being a pan india developer, operator and facilitator of infrastructure projects, recognises the importance of ensuring proper management of e&s risk for each of its projects. espf will enable the company to identify e&s risks associated with projects prior to submission of bids and depending on
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs directors’ Report
59 | finAnciAls
the outcome of Risk Rating and its impact, the company would be able to address the relevant e&s impact and initiate suitable mitigation measures
safeguarding the assets of the company and for preventing and detecting fraud and other irregularities (4) they have prepared the annual accounts on a going concern basis
partIcuLars Of eMpLOyees
The information regarding particulars of remuneration etc of certain employees required under section 217(2A) of the companies Act, 1956 and the rules made thereunder is given in an Annexure which forms part of this report. in terms of section 219(1)(b)(iv) of the companies Act, 1956, the directors’ Report and Accounts are being sent to the shareholders without this Annexure. Any shareholder interested in obtaining this Annexure may write to the company secretary at the Registered office of the company
fOreIGn eXchanGe earnInGs and eXpendIture
The foreign exchange income during the year was ` 64.51 million and expenditure during the year was ` 210.24 million since the company does not have any manufacturing facility, the other particulars required to be provided in terms of the companies (disclosure of particulars in the Report of board of directors) Rules, 1988 are not applicable
dIrectOrs’ respOnsIBILIty stateMent
pursuant to section 217(2AA) of the companies Act, 1956, the directors, based on the representations received from the operating Management, confirm that: (1) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures (2) they have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for that period (3) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for
acknOwLedGMents
The directors place on record their appreciation for the continued support and co-operation received from the various Government Authorities including national Highways Authority of india and other Regulatory Authorities, banks, financial institutions and shareholders of the company The directors would also like to place on record their appreciation for the contribution and dedication of the employees of the company at all levels
by the order of the board
bengaluru, May 4, 2012
deepak dasgupta chairman
47
Transportation
AnnuAl RepoRT 2011-12
RePoRt on coRPoRate goVeRnance
1. cOMpany’s phILOsOphy On cOrpOrate GOVernance
At il&fs Transportation networks limited, the corporate Governance has been an integral part of the way we have been doing our business since inception. we believe that good corporate Governance is the application of best management practices, compliance of law and adherence to ethical standards to achieve the company’s objective of enhancing shareholder’s value and discharge of social responsibility The company places great emphasis on values such as empowerment and integrity of its employees, safety of the employees & communities surrounding our roads, transparency in decision making process, fair & ethical dealings with all and last but not the least, accountability to all the stakeholders The corporate Governance framework in the company has been strengthened with the adoption of the code of conduct and the code of conduct for prevention of insider Trading. The company is committed to meet aspirations of its stakeholders and is striving to be a part of the social development of the country
2.
BOard Of dIrectOrs composition
The company’s policy is to maintain an optimum combination of executive & non-executive directors. The board presently comprises of 12 directors, including 2 executive and 10 non-executive directors, of which 4 are independent directors. The directors are professionals, have expertise in their respective functional areas and bring a wide range of skills and experience to the board
The company Is commITTed To meeT aspIraTIons of ITs sTakeholders and Is sTrIvInG To Be a parT of The socIal developmenT of The counTry
48
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Report on corporate Governance
59 | finAnciAls
none of the directors on the board is a member of more than ten committees or chairman of more than five committees across all the companies in which he is a director. As required under clause 49 of the listing Agreement, necessary disclosures regarding committee positions have been made by the directors during the year under review, the board met 4 (four) times on the following dates: (i) April 29, 2011, (ii) August 5, 2011, (iii) november 9, 2011 and (iv) february 7, 2012 The Agenda and the explanatory notes forming part of agenda are prepared and circulated in advance to the directors. presentations are made on operations / business to the board by the Managing director / executive director name category attendance at Board meeting
category & attendance of directors
The names and categories of the directors on the board, their attendance at the board Meetings held during the year under review, alongwith the number of directorships and committee memberships held by them in other companies as on March 31, 2012 are given below. The directorships in other companies exclude those held in private limited companies, associations, companies incorporated outside india and alternate directorships. The chairmanship / Membership of the committees include memberships of Audit and shareholders’ / investors’ Grievance committees. The details of attendance of the directors at the Annual General Meeting held on August 5, 2011 is also provided attendance at annual General Meeting number of directorships in other public companies chairman Yes 2 Member 3 number of committee positions held in other public companies chairman Member 1 2
held Mr. deepak dasgupta (chairman) Mr. R. c. sinha Mr. H. p Jamdar . Mr. deepak satwalekar Mr. Ravi parthasarathy Mr. Hari sankaran Mr. Arun K. saha Mr. vibhav Kapoor Mr. pradeep puri Mr. R s chandra non-executive, independent non-executive, independent non-executive, independent non-executive, independent non-executive, non-independent non-executive, non-independent non-executive, non-independent non-executive, non-independent non-executive, non-independent non- executive, non-independent 4
attended 4
4 4 4 4 4 4 4 4 4 4 4
4 4 4 4 4 4 4 2 2 4 3
Yes Yes Yes Yes Yes Yes Yes no Yes Yes Yes
8 3 1 -
1 1 5 3 12 10 4 9 2 13 12
2 2 2 1 -
2 3 6 2 4 6
Mr. K Ramchand executive, (Managing director) non-independent Mr. Mukund sapre (executive director) executive, non-independent
49
Transportation
AnnuAl RepoRT 2011-12
directors seeking re-appointment
details of the directors seeking re-appointment at the forthcoming Annual General Meeting as required under clause 49 iv (G) of the listing Agreement are annexed to the notice convening the Annual General Meeting and forms part of this Annual Report
terms of reference
The terms of reference inter alia, include overseeing of the company’s financial reporting process, reviewing the financial statements with the Management, recommending appointment / reappointment of auditors, fixation of audit fees, reviewing the adequacy of internal audit function, periodic discussions with auditors about their scope and adequacy of internal control systems, discussion on any significant findings made by internal Auditors and follow up action. The committee also reviews information prescribed under clause 49(ii)(e) of the listing Agreement with the stock exchanges
3.
audIt cOMMIttee composition
The Audit committee of the company presently comprises of 4 non-executive directors namely, Mr. R c sinha as chairman, Mr. deepak dasgupta, Mr. H p Jamdar and Mr. Arun K saha, Members. except for Mr. saha, all other members are independent directors. Mr. Krishna Ghag, company secretary is the secretary of the Audit committee The composition, role, terms of reference as well as powers of the Audit committee are in accordance with the provisions of clause 49 of the listing Agreement and section 292A of the companies Act, 1956
Meetings held
during the year under review, four Audit committee meetings were held on the following dates: (i) April 29, 2011, (ii) August 5, 2011, (iii) november 9, 2011 and (iv) february 6, 2012
attendance
The attendance at the meetings of the Audit committees held during the period April 1, 2011 to March 31, 2012 are given below: name of director Mr. R c sinha Mr. deepak dasgupta Mr. H p Jamdar Mr. Arun K saha designation chairman Member Member Member category of directorship non-executive, independent non-executive, independent non-executive, independent non-executive, non-independent no of Meetings held 4 4 4 4 attended 4 4 4 4
The Managing director, executive director and chief financial officer of the company attend the meetings. The representatives of the statutory and internal Auditors are also present at the meetings The last Annual General Meeting (AGM) of the company was held on August 5, 2011 and Mr. R.c. sinha, chairman of the Audit committee was present at the AGM
4.
sharehOLders’ / InVestOrs’ GrIeVance cOMMIttee composition
The shareholders’ / investors’ Grievance committee comprises of 2 directors, namely, Mr. Arun K saha, non-executive director as chairman and Mr. K Ramchand, Managing director. Mr. Krishna Ghag, company secretary, is the compliance officer Terms of Reference The terms of reference specifically includes redressal of shareholders/investors grievances pertaining to transfer / dematerialization / rematerialisation of shares, non–receipt of dividend /annual report/ notices, etc
50
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Report on corporate Governance
59 | finAnciAls
Meetings held
during the year under review, five committee meetings were held on the following dates: (i) April 14, 2011, (ii) June 15, 2011, (iii) July 4, 2011, (iv) october 25, 2011 and (v) January 27, 2012
attendance
name of director Mr. Arun K saha designation chairman category of directorship non- executive, non-independent executive, non-independent no of Meetings held 5 5 Mr. K Ramchand, Managing Member director attended 5 5
details of investor complaints received and redressed: The company had received 20 complaints during the period April 1, 2011 to March 31, 2012 and the same were resolved to the satisfaction of the investors. There was no complaint lying unresolved as on March 31, 2012
5.
cOMMIttee Of dIrectOrs composition
The board of directors of the company had constituted a committee of directors to approve the proposals concerning day to day operations for smooth conduct of the business. The committee comprises of Mr. Hari sankaran, Mr. Arun K saha, Mr. pradeep puri, non-executive directors, Mr. K Ramchand, Managing director and Mr. Mukund sapre, executive director
reviewing the performance of the employees, approving the annual remuneration and performance related pay to whole-time directors and the employees of the company for each financial year
Meetings held
no Meeting was held during the year under review
Remuneration Policy
The company’s remuneration policy is driven by the success and performance of the company and the individual employee. 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 related pay. The performance related pay is determined by business performance and the performance of individual employee measured through the annual appraisal process (i) (a) executive directors The company pays remuneration to its Managing director and executive director by way of salary, perquisites and & allowances (fixed related component) pay (variable performance
Meetings held
The committee of directors met 11 times during the period under review on (i) April 14, 2011, (ii) May 30, 2011, (iii) July 19, 2011, (iv) August 9, 2011 (v) september 28, 2011, (vi) november 3, 2011, (vii) december 5, 2011, (viii) december 19, 2011, (ix) January 25, 2012, (x) february 29, 2012 and (xi) March 20, 2012
6.
reMuneratIOn cOMMIttee composition
The Remuneration committee of the company comprises of 3 non-executive directors, namely, Mr. deepak satwalekar as chairman, Mr. Ravi parthasarathy and Mr. Hari sankaran as Members
terms of reference
The terms of reference inter alia include determining the company’s policy on specific remuneration packages including pension rights and other compensation for employees of the company,
component). This is determined based on individual employee wise performance and the company’s overall performance in a financial year, as may be determined by the Remuneration committee of the
51
Transportation
AnnuAl RepoRT 2011-12
board, at the end of each financial year, subject to the overall ceilings stipulated in sections 198 and 309 of the companies Act, 1956 The details of remuneration and perquisites paid to Mr. K Ramchand, Managing director and Mr. Mukund sapre, executive director for the financial year ended March 31, 2012 are as follows: terms of agreement period of appointment date of appointment salary (`) perquisites (`) Retirement benefits (`) performance linked incentive (`) notice period severance fees Mr. k ramchand (Managing director) 5 years August 13, 2008 1,85,93,337 37,17,092 57,99,424 2,50,00,000 Three months There is no separate provision for payment of severance fees The company does not have any stock option plan for its employees (b) non-executive directors: (a) The non-executive directors are paid remuneration by way of commission and sitting fees. in terms of the shareholders’ approval obtained at the Annual General Meeting held on August 4, 2010, the commission payable to the non-executive directors shall not exceed 1% of the net profit of the company computed in accordance with section 309(5) of the companies Act, 1956. The commission is distributed on uniform basis to reinforce the principle of collective responsibility of directors. However, an additional amount is also paid to the chairman of the board and chairman/Members of the Audit and Remuneration committees for the responsibility and time spent by them. The said commission is decided each year by the board of directors The company pays sitting fees @ ` 20,000 per meeting (subject to tax) to its non-executive directors for attending meetings of the board and committees of the board. The company also reimburses out-ofpocket expenses incurred by the directors for attending the meetings The details of sitting fees and commission paid during the period April 1, 2011 to March 31, 2012 are given below: name of director Mr. deepak dasgupta Mr. R. c. sinha Mr. H p Jamdar Mr. deepak satwalekar Mr. Ravi parthasarathy Mr. Hari sankaran Mr. Arun K saha Mr. vibhav Kapoor Mr. pradeep puri Mr. R s chandra sitting fees (`) 1,60,000 1,60,000 1,60,000 80,000 80,000 2,76,667 4,53,334 80,000 40,000 40,000 commission (`) 15,00,000 11,00,000 10,00,000 10,00,000 10,00,000 10,00,000 10,00,000 8,00,000 8,00,000 8,00,000 Mr. Mukund sapre (executive director) 5 years August 13, 2008 85,15,955 33,97,792 17,32,500 1,65,00,000
(b)
(c)
52
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Report on corporate Governance
59 | finAnciAls
(d)
details of shares held by the non-executive directors as on March 31, 2012 are given below: sr. no. 1 2 3 4 5 6 7 name of director Mr. deepak dasgupta Mr. Ravi parthasarathy Mr. Hari sankaran Mr. vibhav Kapoor Mr. Arun K. saha Mr. R.c. sinha Mr. pradeep puri no of shares held 79 3,14,800 3,40,957 3,14,800 3,19,537 53 31,652
(e)
none of the non-executive directors had any material pecuniary relationship or transactions with the company
7.
GeneraL BOdy MeetInGs (a) details of annual General Meeting (aGM) / extra Ordinary General Meeting (eGM) held during the last 3 years are given below:
financial Venue year 2008-09 The il&fs financial centre, c-22, G-block, bandra – Kurla complex, bandra (east), Mumbai 400 051 The il&fs financial centre, c-22, G-block, bandra – Kurla complex, bandra (east), Mumbai 400 051 2009-10 2010-11 Y. b. chavan Auditorium, Gen. J. bhosale Marg, Mumbai 400021 Y. b. chavan Auditorium, Gen. J. bhosale Marg, Mumbai 400021 date time aGM / eGM special resolutions passed 2
August 4, 2009
12.00 noon
eGM
september 9, 2009
10.30 a.m.
AGM
-
August 4, 2010 August 5, 2011
3.30 pm 3.30 pm
AGM AGM
2 -
none of the resolutions were required to be passed through postal ballot. At present, no special Resolutions are proposed to be passed through postal ballot
8.
(a)
dIscLOsures
The company has followed all relevant Accounting standards notified by the companies (Accounting standards) Rules, 2006 while preparing the financial statements There were no materially significant related party transactions i.e. transactions of a material nature, with its promoters, directors or the management, their subsidiaries or relatives etc. during the financial year under review that may have potential conflict with the interests of the company at large except for those disclosed in the financial statements for the year ended March 31, 2012 pursuant to the disclosures made by the senior Management personnel of the company to the board, there were no material, financial and
commercial transactions undertaken by them, which could have potential conflict with the interest of the company at large (d) presentations made to the institutional investors and Analysts are posted on the company’s website (e) There were no instances of non-compliance by the company, no penalties/strictures imposed on the company by the stock exchange or sebi or any statutory authority on any matters related to the capital markets during the period April 1, 2011 to March 31, 2012 (f) in terms of clause 49(v) of the listing Agreement, the Managing director and chief financial officer have furnished the requisite certificates to the board of directors
(b)
(c)
53
Transportation
AnnuAl RepoRT 2011-12
(g)
The board of directors has adopted a code of conduct which lays down various principles of ethics and compliance. The code has been circulated to all the directors and employees of the company and has also been posted on the company’s website further, all the members of the board and senior Management personnel have affirmed compliance with the company’s code of conduct. A declaration to this effect by the Managing director forms part of this report
ii.
The company continues to adopt best practices to ensure the regime of unqualified financial statements. no audit qualifications have been reported on the company’s financial statement for the year ended March 31, 2012 The company has set up a Remuneration committee as per the provisions of clause 49 of the listing Agreement
iii.
9.
Means Of cOMMunIcatIOn
The Quarterly and Annual consolidated financial Results are published in leading newspapers in india. The financial Results are also filed with the stock exchanges and posted on the company’s website All the official news releases are sent to the stock exchanges as well as displayed on the company’s website The company’s website: www.itnlindia.com provides comprehensive information about its business. section on “investors Relations” serves to inform and service the shareholders allowing them to access information at their convenience. presentations made to institutional investors and the shareholding pattern of the company on weekly basis is also displayed on the website A Management discussion & Analysis statement is a part of the company’s Annual Report
(h)
The company has complied with all the mandatory requirements under the provisions of clause 49 of the listing Agreement relating to corporate Governance for the period April 1, 2011 to March 31, 2012 A Reconciliation of share capital Audit is conducted every quarter by a qualified practising company secretary to reconcile the total admitted capital with both the depositories namely, national securities depository limited and central depository services (india) limited and the total issued and listed capital. The said report confirms that the total issued/paid up capital is in agreement with the total number of shares held in physical form and the total number of shares in dematerialised form with the depositories compliance with non Mandatory requirements; i. The code of conduct adopted by the company provides a mechanism for employees to report about unethical behavior, actual or suspected fraud or violation of the code
(i)
(j)
10. GeneraL sharehOLder InfOrMatIOn:
I. Annual General Meeting(AGM) day/date Time venue II. III. IV. V. : Thursday, August 9, 2012 3.30 pm Y b chavan Auditorium Gen. J. bhosale Marg, Mumbai 400 021 : : : : April 1 to March 31 wednesday, August 1, 2012 to Thursday, August 9, 2012 The dividend, if declared, shall be paid/credited before september 7, 2012 (i) national stock exchange of india limited (nse) (ii) bombay stock exchange limited (bse) listing fees have been paid VI. scrip code : il&fsTRAns eQ – nse 533177 – bse
financial year date of book closure dividend payment date listing on stock exchanges
54
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Report on corporate Governance
59 | finAnciAls
VII. Market price data (High/low during each month) on nse & bse: Month high Apr-11 May-11 Jun-11 Jul-11 Aug-11 sep-11 oct-11 nov-11 dec-11 Jan-12 feb-12 Mar-12 256.85 219.00 218.80 230.50 214.90 212.00 218.30 231.00 178.00 214.00 223.90 199.00 nse Low 207.10 186.00 191.60 206.00 168.00 180.25 190.10 162.85 144.00 142.55 186.00 179.50 high 256.65 217.45 218.70 230.50 213.95 212.70 217.30 209.90 182.00 214.45 224.30 198.95 Bse Low 207.00 185.30 192.00 206.00 170.00 179.55 190.80 167.25 145.00 143.10 181.00 180.10
VIII. performance of company’s share price in comparison with nse nifTY and bse senseX during the fY 2011-12 ITNL Share Price/NSE Nifty (High)
300 285 270 255 240 225 210 195 180 165 150 May 11 Aug 11 nov 11 dec 11 Mar 12 sep 11 feb 12 Apr 11 Jun 11 oct 11 Jan 12 Jul 11 6,000 5,800
Share Price
NSE Nifty
5,600 5,400 5,200 5,000
ITNL Share Price NSE Nifty
Month
ITNL Share Price/BSE Sensex (High)
300 285 270 255 240 225 210 195 180 165 150 feb 12 May 11 Aug 11 nov 11 dec 11 Mar 12 Apr 11 Jun 11 Jul 11 sep 11 oct 11 Jan 12 20,000 19,000
Share Price
BSE Sensex
18,000 17,000 16,000 15,000
ITNL Share Price BSE Sensex
Month
55
Transportation
AnnuAl RepoRT 2011-12
IX. Registrar and share Transfer Agents: link intime india private limited c-13, pannalal silk Mills compound, l.b.s Marg, bhandup (west), Mumbai 400 078 Telephone no : +91-22-25960320 fax : +91-22-25960329 email : [email protected] X. share Transfer system The share transfer requests received for physical shares at the Registrar and share Transfer Agents will be processed and delivered within a month from the date of lodgement, if the documents are complete in all respects. Requests for dematerialisation / rematerialisation of shares are processed and
confirmation given to the depositories within 15 days from the date of receipt in order to expedite the process of share transfers, the board has delegated the powers to shareholders’ / investors’ Grievance committee comprising of the Managing director and non-executive director, who shall attend to the share transfer formalities on a periodical basis to ensure that the transfer requests are processed in time. The committee will also consider requests received for transmission of shares, issue of duplicate certificates and split / consolidation of certificates
XI. distribution of shareholding as on March 31, 2012 number of equity share holdings 1-5000 5001-10000 10001-20000 20001-30000 30001- 40000 40001- 50000 50001-100000 100001 & above total number of shareholders 42,953 865 475 189 97 65 155 255 45,054 percentage of shareholders 95.34 1.92 1.05 0.42 0.22 0.14 0.34 0.57 100.00 no. of shares 33,66,684 6,76,838 7,12,131 4,84,349 3,44,428 3,04,577 11,45,849 18,72,32,876 19,42,67,732 percentage of shares 1.73 0.35 0.36 0.25 0.18 0.16 0.59 96.38 100.00
XII. shareholding pattern as on March 31, 2012 sr. no 1 2 3 4 5 6 7 8 9 category promoter Holding promoter Group Holding Mutual funds financial institutions / banks foreign institutional investors/ foreign venture capital bodies corporate foreign bodies corporate nRi individuals total no. of shares 13,50,00,000 57,63,003 67,37,434 6,28,392 61,92,763 91,93,339 1,68,37,028 4,43,491 1,34,72,282 19,42,67,732 percentage 69.49 2.97 3.47 0.32 3.19 4.73 8.67 0.23 6.93 100.00
56
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Report on corporate Governance
59 | finAnciAls
XIII. dematerialisation of shares as on March 31, 2012 The shares of the company are compulsorily traded in electronic mode and are available for trading with both the depositories in india namely, national securities depository limited and central depository services (india) limited. As on March 31, 2012, 19,42,65,630 shares representing 99.99% of the company’s total paid-up share capital (including 72.46% held by the promoter & promoter Group) were held in dematerialised mode XIV. unclaimed shares under ipo The details of the shares remaining unclaimed and lying in the escrow Account of the company are given below: particulars (i) (ii) (i) (ii) (i) (ii) number of shareholders at the beginning of the year number of outstanding shares in the suspense account at the beginning of the year number of shareholders who approached the company and to whom shares were transferred from suspense account during the year number of shares transferred from the suspense account during the year number of shareholders at the end of the year number of outstanding shares in the suspense account at the end of the year details 36 1,877 22 1,221 14 656
The voting rights on these shares shall remain frozen till the rightful owner of such shares claim the shares XV. The company has not issued any GdR/AdR warrants or any other convertible instruments XVI. The company does not have any manufacturing plant XVII. Address for correspondence: IL&fs transportation networks Limited Registered office: The il&fs financial centre, c-22, G-block, bandra – Kurla complex, bandra (east), Mumbai 400 051 Telephone: + 91 22 26533333 fax: + 91 22 26523979 email: [email protected] Link Intime India private Limited Registrar & share Transfer Agent c-13, pannalal silk Mills compound, l.b.s Marg, bhandup (west), Mumbai 400 078 Telephone no: +91-22-25960320 fax: +91-22-25960329 email: [email protected]
57
Transportation
AnnuAl RepoRT 2011-12
DeclaRation RegaRDing coMPliance by boaRD MeMbeRs anD senioR ManageMent PeRsonnel with the coMPany’s coDe of conDuct
The company has adopted a code of conduct for the board of directors and the employees of the company. The code has been circulated to all the members of the board of directors and the employees of the company, which is also put on the company’s website: www.itnlindia.com i hereby confirm that the company has in respect of the financial year ended March 31, 2012 received from all the members of the board of directors and the senior Management personnel a declaration of compliance with the code of conduct of the company as applicable to them for il&fs Transportation networks limited K Ramchand Managing director
Mumbai, May 2, 2012
auDitoRs’ ceRtificate
To The Members of Il&fs transportation networks Limited we have examined the compliance of conditions of corporate governance by il&fs TRAnspoRTATion neTwoRKs liMiTed (“the company”) for the year ended on March 31, 2012 as stipulated in clause 49 of the listing Agreements of the company with the stock exchanges. The compliance of conditions of corporate governance is the responsibility of the Management. our examination was limited to procedures and implementation thereof, adopted by the company for ensuring compliance of the conditions of corporate governance. it is neither an audit nor an expression of opinion on the financial statements of the company. in our opinion and to the best of our information and according to the explanations given to us, we certify that the company has complied with the conditions of corporate governance as stipulated in the above mentioned listing Agreements. we further state that such compliance is neither an assurance as to the future viability of the company nor the efficiency or effectiveness with which the Management has conducted the affairs of the company.
for deloiTTe HAsKins & sells chartered Accountants (Registrationno.117366w) Kalpesh J. Mehta partner (Membership no. 48791)
bengaluru, May 4, 2012
58
sAfe
solid
susTAinAble
That’s iTnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Auditors’ Report
IL&Fs Transportation Networks Limited
To The members of IL&fs TrANsPorTATIoN NeTWorKs LImITeD 1. we have audited the attached Balance Sheet of il&FS tranSportation networKS liMiteD (“the company”) as at March 31, 2012, the Statement of profit and loss and the cash Flow Statement of the company for the year ended on that date, both annexed thereto. these financial statements are the responsibility of the company’s Management. our responsibility is to express an opinion on these financial statements based on our audit 2. we conducted our audit in accordance with the auditing standards generally accepted in india. those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. an audit includes examining, on a test basis, evidence supporting the amounts and the disclosures in the financial statements. an audit also includes assessing the accounting principles used and the significant estimates made by the Management, as well as evaluating the overall financial statement presentation. we believe that our audit provides a reasonable basis for our opinion 3. as required by the companies (auditor’s report) order, 2003 (caro) issued by the central government in terms of Section 227(4a) of the companies act, 1956, we give in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said order 4. Further to our comments in the annexure referred to in paragraph 3 above, we report that: (i) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit; (ii) in our opinion, proper books of account as required by law have been kept by the company so far as it appears from our examination of those books; (iii) the Balance Sheet, the Statement of profit and loss and the cash Flow Statement dealt with by this report are in agreement with the books of account;
(iv) in our opinion, the Balance Sheet, the Statement of profit and loss and the cash Flow Statement dealt with by this report are in compliance with the accounting Standards referred to in Section 211(3c) of the companies act, 1956; (v) in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the companies act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in india: (a) in the case of the Balance Sheet, of the state of affairs of the company as at March 31, 2012; (b) in the case of the Statement of profit and loss, of the profit of the company for the year ended on that date and (c) in the case of the cash Flow Statement, of the cash flows of the company for the year ended on that date 5. on the basis of the written representations received from the Directors as on March 31, 2012 taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2012 from being appointed as a director in terms of Section 274(1)(g) of the companies act, 1956
For DeLoITTe hAsKINs & seLLs chartered accountants (Firm registration no. 117366w) Kalpesh J. Mehta partner Bengaluru, May 4, 2012 (Membership no. 48791)
59
transportation
annual report 2011-12
ANNEXURE TO THE AUDITORS’ REPORT
(referred to in paragraph 3 of our report of even date) (i) Having regard to the nature of the company’s business/activities/results, clauses (ii), (x), (xii), (xiii), (xiv), (xviii), (xix) and (xx) of caro are not applicable to the company (ii) in respect of its fixed assets: (a) the company has maintained proper records showing full particulars, including quantitative details and situation of the fixed assets (b) the fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. according to the information and explanation given to us, no material discrepancies were noticed on such verification (c) the fixed assets disposed during the year, in our opinion, do not constitute a substantial part of the fixed assets of the company and such disposal has, in our opinion, not affected the going concern status of the company (iii) in respect of loans, secured or unsecured, granted by the company to companies, firms or other parties covered in the register maintained under Section 301 of the companies act, 1956, according to the information and explanations given to us: (a) the company has granted unsecured loans aggregating ` 12,564.48 million to thirteen parties during the year. at the year-end, the outstanding balances of such loans aggregated ` 8,893.34 million to fourteen parties and the maximum amount involved during the year was ` 11,842.58 million to fourteen parties (b) the rate of interest and other terms and conditions of such loans are, in our opinion, prima facie, not prejudicial to the interests of the company (c) the receipts of principal amounts and interest have been regular during the year (d) there are no overdue amounts over ` 0.10 million remaining outstanding as at March 31, 2012 in respect of loans, secured or unsecured, taken by the company from companies, firms or other parties covered in the register maintained under Section 301 of the companies act, 1956, according to the information and explanations given to us: (a) the company has taken unsecured loans aggregating ` 800 million from one party during the year. at the year-end, the outstanding balances of such loans aggregated ` 700 million from one party and the maximum amount involved during the year was ` 2,450 million from three parties (b) the rate of interest and other terms and conditions of such loans are, in our opinion, prima facie, not prejudicial to the interests of the company (c) the payments of principal amounts and interest in respect of such loans have been regular / as per stipulations during the year (iv) in our opinion and according to the information and explanations given to us, having regard to the explanations that some of the items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there is an adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchases of fixed assets and the sale of services. During the course of our audit, we have not observed any major weakness in such internal control system (v) to the best of our knowledge and belief and according to the information and explanations given to us, there were no contracts or arrangements referred to in Section 301 of the companies act, 1956 that needed to be entered in the register maintained under the said Section. accordingly, sub-clause (b) of clause (v) of paragraph 4 of caro is not applicable to the company (vi) according to the information and explanations given to us, the company has not accepted any deposit from the public during the year within the meaning of Sections 58a & 58aa or any other relevant provisions of the companies act, 1956 (vii) in our opinion, the internal audit functions carried out during the year by a firm of chartered accountants appointed by the Management have been commensurate with the size of the company and the nature of its business
60
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
(viii) we have broadly reviewed the cost records maintained by the company pursuant to the companies (cost accounting records) rules, 2011 prescribed by the central government under Section 209(1)(d) of the companies act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. we have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete (ix) according to the information and explanations given to us in respect of statutory dues: (a) the company has generally been regular in depositing undisputed dues relating to provident Fund, income-tax, wealth tax, Sales tax, Service tax and other material statutory dues applicable to it with the appropriate authorities during the year (b) there were no undisputed amounts payable in respect of income-tax, wealth tax and other material statutory dues in arrears as at March 31, 2012 for a period of more than six months from the date they became payable (c) there were no disputed dues as regards incometax, wealth tax, Sales tax and Service tax that have not been deposited as at the year end (x) in our opinion and according to the information and explanations given to us, the company has not defaulted in the repayment of dues to banks and financial institutions
(xi) in our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the company for loans taken by others from banks and financial institutions are not, prima facie, prejudicial to the interests of the company (xii) in our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained (xiii) in our opinion and according to the information and explanations given to us, and on an overall examination of the Balance Sheet, we report that ` 5,239 million raised on short-term basis have been used during the year for long- term investment (xiv) to the best of our knowledge and according to the information and explanations given to us, no fraud by the company and no fraud on the company has been noticed or reported during the year
For DeLoITTe hAsKINs & seLLs chartered accountants (Firm registration no. 117366w) Kalpesh J. Mehta partner (Membership no. 48791)
Bengaluru, May 4, 2012
61
transportation
annual report 2011-12
Balance sheet
Particulars eQUITY AND LIAbILITIes shArehoLDers' fUNDs (a) Share capital (b) reserves and surplus NoN-CUrreNT LIAbLITIes (a) long-term borrowings (b) Deferred tax liabilities (net) (c) other long term liabilities
as at 31.03.2012
` in million Note As at March 31, 2012 As at March 31, 2011
2 3
1,942.68 17,495.41
19,438.09
1,942.68 15,904.97
17,847.65
4 7 8
4,000.00 21.22 2,610.80
6,632.02
3,750.00 26.64 3,704.14
7,480.78
CUrreNT LIAbILITIes (a) current maturities of long-term debt (b) Short-term borrowings (c) trade payables (d) other current liabilities (e) Short-term provisions ToTAL AsseTs NoN CUrreNT AsseTs (a) Fixed assets (net) (i) tangible assets (ii) intangible assets (b) non-current investments (c) long-term loans and advances (d) other non-current assets CUrreNT AsseTs (a) trade receivables (b) cash and cash equivalents (c) Short-term loans and advances (d) other current assets ToTAL notes 1 to 37 form part of the financial statements
5 6 11 9 10
8,500.00 14,760.60 4,468.10 5,460.61 1,144.41
34,333.72 60,403.83
6,100.00 9,090.86 2,885.72 4,080.12 1,044.42
23,201.12 48,529.55
12 142.83 158.76 25,145.90 14,243.90 1,021.28 142.45 225.52 21,083.96 11,449.55 420.29
13 14 16
40,712.67
33,321.77
18 19 15 17
9,939.56 40.78 8,551.74 1,159.08
19,691.16 60,403.83
8,386.84 75.58 6,038.23 707.13
15,207.78 48,529.55
in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 62
SaFe SoliD SuStainaBle that’s itnl for you
Bengaluru, May 4, 2012
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
statement of Profit and Loss
Particulars Note
for the Year Ended March 31, 2012
` in million Year ended March 31, 2012 27,725.82 1,376.64 29,102.46 Year ended March 31, 2011 16,158.03 851.77 17,009.80
I) II) III)
reveNUe from oPerATIoNs oTher INCome ToTAL reveNUe (I + II)
23 24
Iv) exPeNses operating expenses employee benefits expense Finance costs Depreciation and amortization expense administrative and general expenses ToTAL exPeNses v) ProfIT before TAxATIoN (III-Iv) 25 26 27 12 28 20,471.91 631.31 2,656.34 105.69 1,100.73 24,965.98 4,136.48 9,532.34 512.01 1,555.03 98.13 794.90 12,492.41 4,517.39
vI) TAx exPeNse: (1) current tax (2) tax relating to earlier year (3) Deferred tax (net) vI) ToTAL TAx exPeNses (vI) vII) ProfIT for The YeAr (v - vI) earnings per equity share (Face value per share `10/-): (1) Basic (2) Diluted notes 1 to 37 form part of the financial statements 33 12.99 12.99 14.83 14.83 1,600.76 4.04 8.70 1,613.50 2,522.98 1,612.27 24.76 1,637.03 2,880.36
in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 Bengaluru, May 4, 2012 63
transportation
annual report 2011-12
Cash Flow statement
for the Year Ended March 31, 2012
` in million Year Ended March 31, 2012 CAsh fLoW from oPerATINg ACTIvITIes profit Before tax Adjustments for interest income profit on sale of unquoted long term investments provisions written back employee benefits (net) profit on sale of fixed assets (net) Depreciation and amortization expense amortisation of premium on forward contract unrealised exchange loss on forward contract Finance costs write back of provision for doubtful debts / advances Dividend income on non-current investments provision for diminution in the value of investments operating profit before Working Capital Changes increase in trade receivables (current and non current) increase in other assets & loans and advances (current and non current) increase in liabilities (current and non current) Cash generated from operations Direct taxes paid (net) Net Cash generated from operating Activities (A) CAsh fLoW from INvesTINg ACTIvITIes additions to fixed assets proceeds from sale of fixed assets investment in / purchase of equity shares of subsidiaries investment in others advance towards Share application Money in subsidiaries advance towards Share application Money in others proceeds from sale of investments proceeds from redemption of Mutual Fund investments long term loans given long term loans recovered Short term loans given (net) refund of advance towards Share application Money amount refunded / (placed) as inter-corporate deposits (net) interest received Fixed deposits with original maturity exceeding 3 months encashed / (placed) (net) Dividend received Net Cash Used In Investing Activities (b) 4,136.48 (1,145.78) 1.95 (0.22) 105.69 (4.56) 30.96 2,656.34 (23.60) 110.00 5,867.26 (1,741.54) (118.83) 1,841.00 5,847.89 (1,627.83) 4,220.06 Year Ended March 31, 2011 4,517.39 (726.29) (40.09) (0.66) 1.13 (0.66) 98.13 1,555.03 (4.00) (32.51) 100.00 5,467.47 (3,626.73) (4,528.92) 7,069.21 4,381.03 (1,805.00) 2,576.03
(39.68) 0.59 (1,457.36) (1,265.72) (1,178.78) (120.00) (4,703.18) 790.12 (2,006.07) 0.05 120.00 733.11 (0.09) 23.60 (9,103.41)
(94.76) 9.18 (4,354.43) (1,532.77) (580.70) (1,016.96) 496.21 2,509.63 (980.93) (650.81) 412.25 (120.00) 573.51 1.58 23.60 (5,305.40)
64
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Cash Flow statement
for the Year Ended March 31, 2012
` in million Year Ended March 31, 2012 CAsh fLoW from fINANCINg ACTIvITIes Share issue expenses recovery of Share issue expenses proceeds from loans repayable on demand from Banks (net) proceeds from long term borrowings repayment of long term borrowings proceeds from short term borrowings repayment of short term borrowings Finance costs paid Dividend payment tax on Dividend paid Net Cash generated from financing Activities (C) Net Decrease in Cash and Cash equivalents (A+b+C) cash and cash equivalents at the beginning of the year cash and cash equivalents at the end of the year Net Decrease in Cash and Cash equivalents notes: 1. components of cash & cash equivalents cash on hand Balances with Banks in current accounts unpaid Dividend accounts Fixed deposits placed for a period exceeding 3 months but not more than 12 months cash and cash equivalents as per note 19 notes 1 to 37 form part of the financial statements 319.74 10,650.00 (8,000.00) 15,450.00 (10,100.00) (2,681.27) (679.94) (110.30) 4,848.23 (35.12) 74.35 39.23 (35.12) Year Ended March 31, 2011 (201.14) 48.66 90.86 6,350.00 (3,000.00) 13,880.00 (13,630.00) (1,481.51) (582.81) (96.80) 1,377.26 (1,352.11) 1,426.46 74.35 (1,352.11)
38.15 1.08 39.23 0.35 1.20 40.78
0.78 73.57 74.35 0.12 1.11 75.58
in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 Bengaluru, May 4, 2012 65
transportation
annual report 2011-12
Notes
I
forming part of the financial statements for the year ended March 31, 2012
NOTE 1 : SIgNIfIcANT AccOUNTINg POlIcIES
bAsIs for PrePArATIoN of fINANCIAL sTATemeNTs the financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles in india, and the applicable accounting standards issued pursuant to the companies (accounting Standards) rules, 2006. all income and expenditure having a material bearing on the financial statements are recognised on an accrual basis II Use of esTImATes the preparation of financial statements requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) as of the date of the Financial Statements and the reported income and expenses during the reporting period. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. actual results could differ from these estimates III fIxeD AsseTs AND DePreCIATIoN/AmorTIsATIoN (a) Tangible assets and depreciation tangible fixed assets acquired by the company are reported at acquisition cost, with deductions for accumulated depreciation and impairment losses, if any the acquisition cost includes the purchase price (excluding refundable taxes) and expenses such as delivery and handling costs, installation, legal services and consultancy services, directly attributable to bringing the asset to the site and in working condition for its intended use where the construction or development of any asset requiring a substantial period of time to set up for its intended use is funded by borrowings, the corresponding borrowing costs are capitalised up to the date when the asset is ready for its intended use Depreciation on tangible fixed assets is computed as under: (i) in respect of premises, depreciation is computed on the Straight line Method at the rates provided under Schedule Xiv of the companies act, 1956 (ii) the company has adopted the Straight line Method of depreciation so as to depreciate 100% of the cost of the following type of assets at rates higher than those prescribed under Schedule Xiv to the companies act, 1956, based on the Management’s estimate of useful life of such assets: Asset Type Data processing equipments Specialised office equipments assets provided to employees Estimated Useful life 4 years 3 years 3 years
(iii) Depreciation on fixed assets, other than on assets specified in notes iii(a) (i) and (ii) above, is provided for on the written Down value Method at the rates provided under Schedule Xiv to the companies act, 1956. Depreciation is computed pro-rata from the date of acquisition of and up to the date of disposal (iv) leasehold improvement costs are capitalised and amortised on a straight-line basis over the period of lease agreement unless the corresponding rates under Schedule Xiv are higher, in which case such higher rates are used (v) all categories of assets costing less than ` 5,000 each, mobile phones and items of soft furnishings are fully depreciated in the year of purchase
66
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
(b) Intangible assets and amortisation intangible assets comprise of software and amounts paid for acquisition of commercial rights under an “operation and Maintenance” agreement of a toll road project intangible assets are reported at acquisition cost with deductions for accumulated amortisation and impairment losses, if any acquired intangible assets are reported separately from goodwill if they fulfil the criteria for qualifying as an asset, implying they can be separated or they are based on contractual or other legal rights and that their market value can be established in a reliable manner an impairment test of intangible assets is conducted annually or more often if there is an indication of a decrease in value. the impairment loss, if any, is reported in the Statement of profit and loss intangible assets are amortised on a “straight line” basis over their estimated useful lives. the estimated useful life of software is four years. the amount paid for acquisition of the rights under the “operations and Maintenance” agreement, is amortised over the minimum balance period of the concession agreement relating to the corresponding toll road project as it existed at the time of acquisition Iv ImPAIrmeNT of AsseTs the carrying values of assets of the company’s cash-generating unit are reviewed for impairment annually or more often if there is an indication of decline in value. if any indication of such impairment exists, the recoverable amounts of those assets are estimated and impairment loss is recognised, if the carrying amount of those assets exceeds their recoverable amount. the recoverable amount is the greater of the net selling price and their value in use. value in use is arrived at by discounting the estimated future cash flows to their present value based on appropriate discount factor v INvesTmeNTs (a) investments are capitalised at actual cost including costs incidental to acquisition (b) investments are classified as long term or current at the time of making such investments (c) long-term investments are individually valued at cost, less provision for diminution that is other than temporary. (d) current investments are valued at the lower of cost and market value vI reveNUe reCogNITIoN the company’s service offerings include advisory and management services, supervisory services (including as lenders’ engineers), operation and maintenance services, toll collection services for toll road projects and rendering assistance to applicant for toll road concessions with the bidding process revenue is recognised when it is realised or realisable and earned. revenue is considered as realised or realisable and earned when it has persuasive evidence of an arrangement, delivery has occurred, the sales price is fixed or determinable and collectability is reasonably assured revenue in respect of arrangements made for rendering services is recognised over the contractual term of the arrangement. in respect of arrangements, which provide for an upfront payment followed by additional payments as certain conditions are met (milestone payments), the amount of revenue recognised is based on the services delivered in the period as stated in the contract. in respect of arrangements where fees for services rendered are success based (contingent fees), revenue is recognised only when the factor(s) on which the contingent fees is based, actually occur revenue from development projects under fixed - price contracts, where there is no uncertainty as to measurement or collectability of consideration is recognised based on the milestones reached under the contracts
67
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
contract revenue and costs associated with the construction of roads is recognised as by reference to the stage of completion of the projects at the Balance Sheet date. the stage of completion of a project is determined by the proportion that the contract cost incurred for work performed up to the Balance Sheet date bears to the estimated total contract costs any excess revenue recognised in accordance with the stage of completion of the project, in comparison to the amounts billed to the clients in accordance with the milestones completed as per the respective development agreements, is carried forward as “unearned revenue” any short revenue recognised in accordance with the stage of completion of the project, in comparison to the amounts billed to the clients in accordance with the milestones completed as per the respective development agreements, is carried forward as “unbilled revenue” interest income is accrued evenly over the period of the corresponding instrument Dividend income is recognised when the unconditional right to receive the payment is established vII foreIgN CUrreNCY TrANsACTIoNs transactions in foreign currencies are translated to the reporting currency based on the exchange rate on the date of the transaction. exchange difference arising on settlement thereof during the period is recognised as income or expense in the Statement of profit and loss Foreign currency denominated cash and bank balances, receivables (other than those that are in substance the company’s net investment in a non integral foreign operation), and liabilities (monetary items) outstanding as at the period end are valued at closing-date rates, and unrealised translation differences are included in the Statement of profit and loss non monetary items (such as equity investments) denominated in foreign currencies are reported using the exchange rate as at the date of the transaction. where such items are carried at fair value, these are reported using exchange rates that existed on dates when the fair values were determined inter company receivables or payables for which settlement is neither planned nor likely to occur in the foreseeable future and are in substance an extension to or a deduction from the company’s net investments in a non - integral foreign operations are also translated at closing rates but the exchange differences arising are accumulated in the foreign currency translation reserve until disposal of the net investment, at which time they are recognised as income or expense in the Statement of profit and loss. any repayment of receivables or payables forming part of net investment in foreign operations is not considered as partial disposal of investments in foreign operations and amounts previously recognised in the foreign currency translation reserve are not adjusted until the disposal of the ownership interest occurs vIII emPLoYee beNefITs (a) short term Short term employee benefits are recognised as an expense at the undiscounted amount expected to be paid over the period of services rendered by the employees to the company (b) Long term the company has both defined-contribution and defined-benefit plans, of which some have assets in special funds or securities. the plans are financed by the company and in the case of some defined contribution plans by the company along with its employees (i) Defined-contribution plans these are plans in which the company pays pre-defined amounts to separate funds and does not have any legal or informal obligation to pay additional sums. these comprise of contributions to the employees’ 68
SaFe SoliD SuStainaBle that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
provident fund, family pension fund and superannuation fund. the company’s payments to the definedcontribution plans are reported as expenses in period in which the employees perform the services that the payment covers (ii) Defined-benefit plans expenses for defined-benefit gratuity plans are calculated as at the balance sheet date by independent actuaries in a manner that distributes expenses over the employee’s working life. these commitments are valued at the present value of expected future payments, with consideration for calculated future salary increases, using a discount rate corresponding to the interest rate estimated by the actuary having regard to the interest rate on government bonds with a remaining term that is almost equivalent to the average balance working period of employees the actuarial gains and losses are recognised immediately in the Statement of profit and loss (c) others compensated absences which accrue to employees and which can be carried to future periods but are expected to be encashed or availed in twelve months immediately following the year end are reported as expenses in the year in which the employees perform the services that the benefit covers at the undiscounted amount of the benefits after deducting amounts already paid. where there are restrictions on availment or encashment of such accrued benefit or where the availment or encashment is otherwise not expected to wholly occur in the next twelve months, the liability on account of the benefit is actuarially determined using the projected unit credit method Ix TAxes oN INCome taxes include taxes on the company’s taxable profits, adjustment attributable to earlier periods and changes in deferred taxes. taxes are determined in accordance with enacted tax regulations and tax rates in force and in the case of deferred taxes at rates that have been substantively enacted Deferred tax is calculated to correspond to the tax effect arising when final tax is determined. Deferred tax corresponds to the net effect of tax on all timing differences which occur as a result of items being allowed for income tax purposes during a period different from when they are recognised in the financial statements Deferred tax assets are recognised with regard to all deductible timing differences to the extent that it is probable that taxable profit will be available in future against which deductible timing differences can be utilised when the company carries forward unused tax losses and unabsorbed depreciation, deferred tax assets are recognised only to the extent there is virtual certainty backed by convincing evidence that sufficient future taxable income will be available against which deferred tax assets can be realised the carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced by the extent that it is no longer probable that sufficient taxable profit will be available to allow all or a part of the aggregate deferred tax asset to be utilised x LeAse ACCoUNTINg leases of assets where the lessor retains substantially all the risks and benefits of ownership of the assets are classified as operating leases. operating lease payments are recognised as an expense in the Statement of profit and loss on a straight line basis over the lease term. any compensation, according to agreement, that the lessee is obliged to pay to the lessor if the leasing contract is terminated prematurely is expensed during the period in which the contract is terminated
69
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
xI ProvIsIoNs, CoNTINgeNT LIAbILITIes AND CoNTINgeNT AsseTs a provision is recognised when the company has a present obligation as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. provisions (excluding employee benefits) are not discounted to their present value and are determined based on best estimates required to settle the obligation at the Balance Sheet date. these are reviewed at each balance sheet date and adjusted to reflect the current best estimates. contingent liabilities are not recognised but are disclosed in the notes to the financial statement. a contingent asset is neither recognised nor disclosed xII segmeNT rePorTINg the accounting policies adopted for segment reporting are in accordance with the accounting policy of the company. Segment revenue, expenses, assets and liabilities have been identified to segments on the basis of their relationship to the operating activities of the Segment. revenues, expenses, assets and liabilities, which relate to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under “unallocated revenue / expenses / assets / liabilities” xIII borroWINg CosTs Borrowing costs are recognised in the period to which they relate, regardless of how the funds have been utilised, except where it relates to the financing of construction or development of assets requiring a substantial period of time to prepare for their intended future use. Borrowing costs are capitalised up to the date when the asset is ready for its intended use. the amount of borrowing costs capitalised (gross of tax) for the period is determined by applying the interest rate applicable to appropriate borrowings outstanding during the period to the average amount of accumulated expenditure for the assets during the period xIv CAsh AND CAsh eQUIvALeNTs cash comprises of cash on Hand, cheques on Hand and demand deposits with Banks. cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risks of changes in value xv CAsh fLoW sTATemeNT the cash Flow Statement is prepared in accordance with the “indirect Method” as explained in the accounting Standard (aS) 3 on cash Flow Statements xvI eArNINgs Per shAre Basic earnings per share is calculated by dividing the net profit after tax for the period attributable to equity shareholders of the company by the weighted average number of equity shares in issue during the period Diluted earnings per share is calculated by dividing the net profit after tax for the period attributable to equity shareholders of the company by the weighted average number of equity shares determined by assuming conversion on exercise of conversion rights for all potential dilutive securities xvII DerIvATIve TrANsACTIoNs premium paid on option contracts acquired is treated as an asset until maturity. premium received on option contracts written is treated as liability until maturity. in case of Forward exchange contracts which are not intended for trading or speculation purposes, the premium or discount arising at the inception of such a forward exchange contract is amortised as expense or income over the life of the contract. exchange differences on such a contract are recognised in the Statement of profit and loss in the reporting period in which the exchange rates change. any profit or loss arising on cancellation or renewal of such a forward exchange contract is recognised as income or as expense for the period
70
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 2 : SHARE cAPITAl
As at March 31, 2012 Number of Shares ` in million As at March 31, 2011 Number of Shares ` in million
Particulars
Authorised equity Shares of ` 10/- each Issued equity Shares of ` 10/- each subscribed and Paid up equity Shares of ` 10/- each fully paid (refer foot note no. i, ii and iii) ToTAL fooT NoTes: i) reconciliation of the number of equity shares outstanding at the beginning and at the end of the reporting period : Year ended March 31, 2012 Number of Shares Shares outstanding at the beginning of the year Shares issued during the year Shares bought back during the year Shares outstanding at the end of the year 194,267,732 194,267,732 ` in million 1,942.68 1,942.68 Year ended March 31, 2011 Number of Shares 194,267,732 194,267,732 ` in million 1,942.68 1,942.68 194,267,732 194,267,732 194,267,732 1,942.68 1,942.68 1,942.68 194,267,732 194,267,732 194,267,732 1,942.68 1,942.68 1,942.68 250,000,000 2,500.00 250,000,000 2,500.00
Particulars
ii) Shareholding more than 5% of issued, subscribed and paid up equity share capital As at March 31, 2012 Shareholder il&FS il&FS employees welfare trust ToTAL * Number of Shares 135,000,000 135,000,000 % of total holding 69.49% 69.49% As at March 31, 2011 Number of Shares 135,000,000 10,867,769 145,867,769 % of total holding 69.49% 5.59% 75.08%
not applicable* not applicable*
the number of shares held by il&FS employees welfare trust as at March 31, 2012 do not represent 5% or more of the total holding and hence, the disclosure of number of shares and percentage of total holding as at March 31, 2012 have not been given thereof
iii) of the above 135,000,000 (as at March 31, 2011 : 135,000,000) shares are held by the holding company viz. infrastructure leasing & Financial Services limited (“il&FS”) and 2,440,534 (as at March 31, 2011 : nil) shares are held by a fellow subsidiary viz. il&FS Financial Services limited
71
transportation
annual report 2011-12
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 3 : RESERvES AND SURPlUS
As at March 31, 2012 10,320.57 715.52 252.30 52.53 (29.41) 23.12 4,816.35 2,522.98 252.30 777.07 126.06 6,183.90 17,495.41 3,014.27 2,880.36 288.04 679.94 110.30 967.82 427.48 288.04 52.53 -
` in million As at March 31, 2011 10,320.57
(a) securities Premium Account (b) general reserve opening balance (+) current year transfer (-) written back in current year (c) foreign Currency translation reserve (refer Note vII of Note 1) opening Balance (-) Foreign exchange translation loss (net of deferred tax of ` 14.12 million (previous year ` nil)) closing Balance (d) surplus in the statement of Profit and Loss opening balance (+) profit for the year (-) transfer to general reserve (-) provision for proposed dividend (refer note no. 21) (-) provision for Dividend Distribution tax on proposed dividend closing Balance ToTAL
715.52
52.53
4,816.35 15,904.97
NOTE 4 : lONg-TERM BORROwINgS
Particulars unsecured term loans from Banks (refer foot note no.1) ToTAL 4,000.00 4,000.00 As at March 31, 2012
` in million As at March 31, 2011 3,750.00 3,750.00
fooT NoTes: No. 1: i) terms of repayment and rate of interest for long term borrowings outstanding as on March 31, 2012 As at March 31, 2012 Name of Bank State Bank of travancore Bank of Baroda South indian Bank Bank of india ToTAL ` in million 500.00 2,000.00 1,000.00 500.00 4,000.00 Terms of repayment Bullet repayment Bullet repayment Bullet repayment Bullet repayment Due Date for Repayment March 22, 2014 March 21, 2014 December 9, 2013 august 25, 2013
72
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
terms of repayment and rate of interest for long term borrowings outstanding as on March 31, 2011 As at March 31, 2011 Name of Bank Bank of india punjab and Sind Bank limited punjab and Sind Bank limited united Bank of india South indian Bank punjab and Sind Bank limited Bank of india ToTAL ` in million 500.00 500.00 625.00 500.00 500.00 625.00 500.00 3,750.00 Terms of repayment Bullet repayment Bullet repayment Bullet repayment Bullet repayment Bullet repayment Bullet repayment Bullet repayment Due Date for Repayment august 25, 2013 March 25, 2013 March 22, 2013 December 29, 2012 December 7, 2012 September 25, 2012 august 25, 2012
NOTE 5 : cURRENT MATURITIES Of lONg-TERM DEBT
Particulars unsecured from Banks ToTAL As at March 31, 2012 8,500.00 8,500.00
` in million As at March 31, 2011 6,100.00 6,100.00
NOTE 6 : SHORT-TERM BORROwINgS
Particulars (a) secured loans repayable on demand from Banks (Secured by First pari passu charge over current assets and receivables) (b) Unsecured (i) short term loans From Banks From other parties (ii) Loans and advances from related parties ToTAL 12,650.00 1,000.00 700.00 14,760.60 410.60 As at March 31, 2012
` in million As at March 31, 2011 90.86
7,300.00 1,700.00 9,090.86
73
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 7 : DEfERRED TAX lIABIlITIES (NET)
the company has a net deferred tax liability of ` 21.22 million (as at March 31, 2011 : ` 26.64 million). the components are as under (refer foot notes 1 and 2): ` in million Particulars in respect of depreciation in respect of employee benefits in respect of provision for doubtful debts DeferreD TAx LIAbILITIes (NeT) fooT NoTe: 1) the company has not recognised any deferred tax asset against provision created for diminution in value of investments in absence of virtual certainty of future taxable capital gains against which the deferred tax asset could be offset 2) Deferred tax charge (net) during the year includes deferred tax charge of ` 14.12 million on account of deferred tax liability created during the year which has been directly adjusted against Foreign currency translation reserve recognised in respect of the foreign exchange translation differences on the company’s receivables which are regarded as an extension to the company’s net investments in a foreign entity and have not been included above As at March 31, 2011 38.28 (9.65) (1.99) 26.64 Movement during the year (refer foot note 2) (7.92) 1.48 1.02 (5.42) As at March 31, 2012 30.36 (8.17) (0.97) 21.22
NOTE 8 : OTHER lONg TERM lIABIlITIES
Particulars (a) retention money payable (b) Mobilisation advances received (b) option premium liabilities (refer note no. 22) ToTAL As at March 31, 2012 735.90 1,758.81 116.09 2,610.80
` in million As at March 31, 2011 318.55 3,269.50 116.09 3,704.14
NOTE 9 : OTHER cURRENT lIABIlITIES
Particulars (a) interest accrued but not due on borrowings (b) Mobilisation advances received (c) unearned revenue (refer note no. 29) (d) unpaid dividends (e) other payables (refer foot note below) ToTAL As at March 31, 2012 24.77 3,741.19 1,361.94 0.35 332.36 5,460.61
` in million As at March 31, 2011 49.70 2,413.24 1,420.19 0.12 196.87 4,080.12
fooT NoTe other payables includes deferred premium on forward contract of ` 31.53 million (as at March 31, 2011 : ` nil) and statutory dues payable of ` 300.83 million (as at March 31, 2011 : ` 196.87 million)
74
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 10 : SHORT-TERM PROvISIONS
As at March 31, 2012 235.17 777.07 126.06 6.11 1,144.41
` in million As at March 31, 2011 253.70 679.94 110.30 0.48 1,044.42
(a) provision for employee benefits (net) (refer foot note no. 2(b) of note 26) (b) others provision for proposed dividend provision for dividend distribution tax provision for tax (net) ToTAL
NOTE 11 : TRADE PAYABlES
according to the records available with the company, there were no dues to Micro and Small enterprises as defined under the Micro, Small and Medium enterprises Development act 2006. Hence, no disclosures are to be given in respect thereof
75
76 ` in million gross Block (at cost) Accumulated Depreciation and Amortisation Net Block Net Block
NOTE 12 : fIXED ASSETS
Notes
SaFe
SoliD
Balance Balance Balance Balance Balance Balance Depreciation as at Deletions / as at as at Deletions / as at as at as at Additions charge April 1, Adjustments March 31, April 1, Adjustments March 31, March 31, March 31, for the year 2011 2012 2011 2012 2012 2011
transportation
SuStainaBle
a 3.71 1.31 21.90 5.77 5.53 38.22 (1.73) 255.69 76.75 37.47 (1.36) 12.45 3.66 4.52 36.30 17.04 5.79 (0.31) 28.51 12.59 4.01 (0.29) 16.31 22.83 8.18 112.86 (1.42) 82.90 20.69 14.12 (1.07) 33.74 16.71 9.17 1.92 11.09 63.86 12.75 6.87 19.62 44.24 5.62 49.16 12.20 13.47 4.27 142.83 14.96 0.85 0.24 1.09 13.87
Tangible Assets 14.11 47.40 6.23 41.73 10.46 13.73 8.79 142.45
Buildings
14.96
plant and Machinery
60.15
forming part of the financial statements for the year ended March 31, 2012
that’s itnl for you
Furniture and fixtures
15.40
vehicles
62.42
office equipments
23.05
Data processing equipments
30.77
leasehold improvements
12.45
(operating lease)
ToTAL
219.20
b Intangible Assets 1.46 1.46 39.68 95.43 (11.70) 544.15 (1.73) 582.10 176.18 81.20 326.41 99.43 266.41 60.00 85.13 14.30 65.57 2.65 68.22 105.69 98.13 (1.36) (3.15) 150.70 16.95 167.65 280.51 176.18 115.71 43.05 158.76 301.59 367.97 179.82 45.70 225.52 367.97
computer software (acquired) commercial rights (acquired) (refer Foot note no.1)
264.95 60.00
ToTAL
324.95
grAND ToTAL
544.15
As AT mArCh 31, 2011
460.42
fooT NoTe: 1) During the year 2006-07, the company incurred a cost of ` 60.00 million for acquiring commercial rights under the “operations and Maintenance” agreement (“o&M contract”) for one of the road projects from the erstwhile contractor. under the terms of the o&M contract, the company is entitled to routine maintenance price and the operation price for maintaining and operating the project. the company expects benefits under the o&M contract to accrue until the end of the concession period which is not expected to be earlier than May 12, 2029. accordingly, the expenditure incurred by the company for acquisition of the rights is treated as an intangible asset and is being amortised on a straight line basis over the minimum balance period of the concession i.e. 22 years and 7 months (from the date of acquisition of the said commercial rights)
annual report 2011-12
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 13 : NON-cURRENT INvESTMENTS
` in million As at March 31, 2012 21,013.34 804.40 1,106.40 1,693.00 1,038.76 25,655.90 510.00 25,145.90 As at March 31, 2011 18,427.12 583.90 786.40 648.00 1,038.54 21,483.96 400.00 21,083.96
TrADe INvesTmeNTs (refer A beLoW) (a) investments in equity shares (b) investments in preference shares (c) investments in debentures (d) investments in covered warrants (e) investments in units sUb- ToTAL less : provision for diminution in the value of investments ToTAL
A. DETAIlS Of TRADE INvESTMENTS (REfER fOOT NOTES NO.1 TO 6)
As at March 31, 2012 Sr. Name of the Entity No. Quantity face value per unit (`) ` in million As at March 31, 2011 Quantity face value per unit (`) ` in million
(a)
Investment in equity shares subsidiaries (Unquoted; fully paid - At Cost) gujarat road and infrastructure company limited north Karnataka expressway limited east Hyderabad expressway limited itnl international pte. limited (nominal value uS$ 1 each) itnl road infrastructure Development company limited elsamex S.a. (nominal value euro 60.10121 each) (refer Foot note no.2) vansh nimay infraprojects limited (refer Foot note no.3) il&FS rail limited (Formerly Known as itnl enso rail Systems limited) Hazaribagh ranchi expressway limited pune Sholapur road Development company limited west gujarat expressway limited Moradabad Bareilly expressway limited Jharkhand road projects implementation company limited chenani nashri tunnelway limited Mp Border checkposts Development company limited Badarpur tollway operations Management limited rapid Metrorail gurgaon limited
76,542,250 7,720,823 21,689,400
10
442.50 77.21 216.89 1,340.15 400.00 2,722.34 145.00 1,164.09 0.37
76,542,250 7,720,823 21,689,400
10
442.50 77.21 216.89 1,340.15 400.00 2,722.34 92.00 448.50 0.37 1,600.00 98.00 2,216.60 1,531.65 3,475.90 0.26 0.50 0.27
10 10 not 28,050,001 applicable 40,000,000 10 not applicable 14,300,000 10 260,949 82,109,960 37,000 160,000,000 14,799,985 221,660,000 153,165,000 372,000,000 25,500 49,994 27,083 10 10 10 10 10 10 10 10 10 10
10 10 not 28,050,001 applicable 40,000,000 10 not applicable 9,000,000 10 260,949 44,850,000 37,000 10 10 10 10 10 10 10 10 10 10
1,600.00 160,000,000 100.50 9,800,000 2,216.60 221,660,000 2,280.90 153,165,000 3,720.00 347,590,000 83.52 25,500 0.50 0.27 49,994 27,083
77
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
As at March 31, 2012 Sr. Name of the Entity No. Quantity face value per unit (`) 10 ` in million
As at March 31, 2011 Quantity face value per unit (`) 10 10 10 ` in million
Futureage infrastructure india limited 3,000,000 30.00 (Formerly Known as global parking plaza limited) charminar robopark limited 50,000 10 3.00 Karyavattom Sports Facilities limited 49,940 10 0.50 Kiratpur ner chowk expressway limited 8,550,000 10 85.50 itnl offshore pte. ltd. (nominal value not 50,000 2.61 uS$ 1 each) applicable Joint ventures (fully paid - At Cost) Jorabat Shillong expressway limited 21,000,000 10 210.00 21,000,000 (unquoted) naM expressway limited (unquoted) 116,754,970 10 1,167.55 116,754,970 noida toll Bridge company limited 47,195,007 10 1,871.58 47,195,007 (Quoted) Associates (Unquoted; fully paid - At Cost) thiruvananthapuram road 17,030,000 10 170.30 17,030,000 Development company limited andhra pradesh expressway limited 16,513,060 10 165.13 16,513,060 itnl toll Management Services limited 24,500 10 0.25 24,500 warora chandrapur Ballarpur toll road 61,708,490 10 617.08 17,490 limited others (Unquoted; fully paid - At Cost) 179.00 12,000,000 pipavav railway corporation limited 12,000,000 10 sUb-ToTAL (A) 21,013.34 (b) Investments in Preference shares in subsidiaries (Unquoted; fully paid At Cost) west gujarat expressway limited 20,000,000 10 296.90 20,000,000 (refer Foot note no.5) rapid Metrorail gurgaon limited 507.50 28,700,000 50,750,000 10 (refer Foot note no.6) sUb-ToTAL (b) 804.40 (c) Investments in Debentures (Unquoted; fully paid - At Cost) 5% optionally convertible debentures 7,864,000 100 786.40 7,864,000 of andhra pradesh expressway limited (associate) 11.50% non-convertible debentures 32,000,000 10 320.00 of road infrastructure Development company of rajasthan limited sUb-ToTAL (C) 1,106.40 (d) Investments in Covered Warrants (Unquoted; fully paid - At Cost) infrastructure leasing & Financial Services 169,300,000 10 1,693.00 64,800,000 limited (refer Foot note no.4) (d) (e) Investments in Units (Unquoted; fully paid - At Cost) itnl road investment trust (a 1,038,762 1000 1,038.76 1,038,541 Subsidiary) (e) grAND ToTAL (A+b+C+D+e) 25,655.90
210.00 1,167.55 1,871.58
10 10 10 10 10
170.30 165.13 0.25 0.17 179.00 18,427.12
10 10
296.90 287.00 583.90
100
786.40
-
786.40
10
648.00
1000
1,038.54 21,483.96
78
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
` in million As at March 31, 2012 1,871.58 23,784.32 25,655.90 As at March 31, 2011 1,871.58 19,612.38 21,483.96
aggregate cost of quoted investments (Market value of ` 1,057.70 million; as at March 31, 2011 : ` 1,250.67 million) aggregate cost of unquoted investments ToTAL foot Notes 1
the company has given non-disposal undertakings to the lenders and / or equity investors of certain infrastructure companies promoted by it with regard to its investments in the equity share capital of these companies as a part of promoter’s undertaking to such lenders and / or equity investors. also, the company has given non-disposal undertakings to the grantors of the concession to certain infrastructure companies promoted by the company with regard to its investments in the equity share capital of these companies the company has pledged 171,959 (as at March 31, 2011-171,959) equity shares representing 51% of the overall shareholding in elsamex S.a., in favour of certain lenders for a term loan facility availed by elsamex S.a. the company has pledged 14,300,000 (as at March 31, 2011-9,000,000) shares of vansh nimay infraprojects limited (“Borrower”) with il&FS trust company limited (“Security trustee”) to secure the dues of the Borrower including without limitation all principal amounts, interest expenses, penalties, costs, fees, etc payable by the Borrower in relation to the facility extended by the consortium of Financial institutions and Banks under the pooled Municipal Debt obligation Facility (“pMDo”) the company’s investment in “covered warrants” aggregating to ` 1,693.00 million (as at March 31, 2011 ` 648.00 million) issued by infrastructure leasing & Financial Services limited (“il&FS”) are variable interest debt instruments under which the holder is entitled to a proportionate share of the dividend, if any, declared by road infrastructure Development company of rajasthan limited (“riDcor”), Jharkhand accelerated road Development company limited (“JarDcl”), chhatisgarh Highways Development company limited (“cHDcl”) and Jharkhand road projects implementation company limited (“Jrpicl”) on the equity shares held by il&FS as well as the interest granted by riDcor on the Fully convertible Debentures (“FcDs”) held by il&FS. However, the company is not entitled to rights and privileges, which il&FS enjoys as a shareholder / debentureholder. the instruments are unsecured the company’s investment in redeemable / optionally convertible cumulative preference shares of west gujarat expressway limited (“wgel”) are convertible, at the option of the company, into 1 equity share and carry a coupon of 2% per annum, accrued annually in arrears (“coupon”). an additional coupon consisting of 95% of the balance distributable profits, that may be available with wgel after it has met all other obligations, would accrue on the said preference shares (“additional coupon”) the company’s investments in compulsorily convertible preference shares of rapid Metrorail gurgaon limited are fully and compulsorily convertible into equity shares within 90 days from achieving the commercial operation date of the project
2 3
4
5
6
79
transportation
annual report 2011-12
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 14 : lONg-TERM lOANS AND ADvANcES (UNSEcURED, cONSIDERED gOOD)
As at March 31, 2012 3.19 54.69 5,151.37 2,503.30 7,654.67 101.68 4,479.27 269.80 1,680.60 14,243.90
` in million As at March 31, 2011 6.72 42.15 1,888.20 2,452.18 4,340.38 108.91 5,364.85 469.80 1,116.74 11,449.55
a. Capital Advances advance towards fixed assets b. security Deposits c. Loans and advances to related parties long term loans advance towards Share application Money (refer foot note) sUb-ToTAL (C.) d. prepaid expenses e. preconstruction and Mobilisation advances paid to contractors (refer foot note 2 of note 15) f. advance towards Share application Money g. loans to others ToTAL foot Note
as required under the restructuring package of gujarat road and infrastructure company limited (“gricl”), approved by the corporate Debt restructuring cell on June 17, 2004, the company as one of the promoters of gricl advanced ` 600.00 million towards preference Share capital. out of the above advance, ` 150.00 million was to be applied against issue of 1% non cumulative convertible preference Shares and ` 450.00 million against issue of 8% redeemable convertible preference Shares. gricl proposes to convert this advance into subordinated debt. pending completion of the process for the conversion, the company has classified the amount as “advance towards Share application Money”
NOTE 15 : SHORT-TERM lOANS AND ADvANcES
Particulars a. Loans and advances to related parties (Unsecured, considered good) advances receivable in cash or in kind Short term loans inter-corporate deposits option premium (refer note no.22) b. others (Unsecured, considered good) advances receivable in cash or in kind (refer foot note 1 below) prepaid expenses Short term loans current maturities of long term loans and advances Staff loans Mobilisation and other advances (refer foot note 2 below) advance payment of taxes (net of provision) ToTAL foot Note As at March 31, 2012 147.10 3,832.47 3,979.57 158.65 52.60 1,075.50 42.50 8.68 2,365.45 868.79 4,572.17 8,551.74
` in million As at March 31, 2011 255.54 1,465.90 120.00 1.25 1,842.69 273.89 50.09 1,436.00 5.80 1,589.63 840.13 4,195.54 6,038.23
1. advances receivable in cash or in kind from others includes receivable on account of forward contract (net) of ` 5.13 million (as at March 31, 2011 : nil) 2. Mobilisation advances are disclosed as long term and short term on the basis of technical estimates made by the Management on the progress of construction activities on various projects
80
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 16 : OTHER NON-cURRENT ASSETS
As at March 31, 2012 345.77 675.51 1,021.28
` in million As at March 31, 2011 156.95 263.34 420.29 ` in million As at March 31, 2012 232.37 926.71 1,159.08 As at March 31, 2011 231.87 475.26 707.13 ` in million As at March 31, 2012 As at March 31, 2011
retention Money receivable (unsecured, considered good) (refer note 29) interest accrued and not due ToTAL
NOTE 17 : OTHER cURRENT ASSETS
Particulars interest accrued unbilled revenue (refer note no. 29) ToTAL
NOTE 18 : TRADE REcEIvABlES
Particulars Trade receivables outstanding for a period less than six months from the date they are due for payment unsecured, considered good Trade receivables outstanding for a period exceeding six months from the date they are due for payment unsecured, considered good unsecured, considered doubtful less: provision for doubtful debts ToTAL
9,072.31 9,072.31
7,984.16 7,984.16
867.25 3.00 (3.00) 867.25 9,939.56
402.68 3.00 (3.00) 402.68 8,386.84 ` in million
NOTE 19 : cASH AND cASH EQUIvAlENTS
Particulars a. Cash and cash equivalents cash on hand Balances with Banks in current accounts b. others unpaid Dividend accounts Fixed Deposits placed for a period exceeding 3 months but not more than 12 months ToTAL included in above, the balances that meet the definition of cash and cash equivalents as per aS-3 “cash Flow Statements” As at March 31, 2012 1.08 38.15 39.23 0.35 1.20 1.55 40.78 39.23
As at March 31, 2011 0.78 73.57 74.35 0.12 1.11 1.23 75.58 74.35
81
transportation
annual report 2011-12
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 20 : cONTINgENT lIABIlITIES AND cOMMITMENTS
As at March 31, 2012 12.92
` in million As at March 31, 2011 25.71
(i) Contingent Liabilities (refer foot note 1) a) claims against the company not acknowledged as debts income tax demands contested by the company b) guarantees guarantees/counter guarantees issued in respect of borrowing facilities of subsidiary companies (refer foot note no.2) (ii) Commitments a) estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) b) exercise price payable in respect of call option contracts (refer note no. 22) c) investment commitments [net of advances of ` 2,173.08 million, (as at March 31, 2011 : ` 2,321.96 million)] foot Note
12,321.95 -
4,888.63 2.13
11,757.95
1.25 6,963.12
1) the company does not expect any outflow of economic resources in respect of the above and therefore no provision is made in respect thereof 2) certain bankers have issued guarantees which have been shown under “guarantees/counter guarantees issued in respect of borrowing facilities of subsidiary companies” aggregating ` 1,480.05 million (as at March 31, 2011 : ` 812.94 million) against a first charge on the receivables (including loans and advances) of the company
NOTE 21 : PROPOSED DIvIDEND
Name of the Entity As at March 31, 2012 Total ` in million Dividend proposed to be distributed to equity shareholders 777.07 Per share ` 4.00 As at March 31, 2011 Total ` in million 679.94 Per share ` 3.50
NOTE 22 : DERIvATIvES AND fOREIgN cURRENcY EXPOSURES
a) the company as a part of its strategic initiatives to consolidate/restructure its investments in surface transport sector, has made direct investments in certain special purpose entities (“Spe”s) engaged in that sector and also invested in units of a scheme of itnl road investment trust (the “Scheme”) which in turn has made investments in such Spes. amounts invested include derivative instruments in the form of call options the amounts outstanding as at March 31, 2012 in respect of derivative transactions are summarised below: Particulars call options written for sale of equity shares call option for equity shares in an Spe bought Number of instruments 2 (2) (1) Figures in brackets relate to March 31, 2011 call option prmium (` in million) 116.09 (116.09) (1.00) Exercise price payable / receivable (` in million) 6.11 (6.11) (1.00)
82
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
premium received by the company towards call option sold by it have been aggregated under the head “option premium liabilities” classified as a part of “other long term liabilities”. conversely, premiums paid by the company towards call options purchased by it have been aggregated under the head “option premium” and classified as a part of “Short-term loans and advances”. options in respect of “option premium liabilities” amounting ` 39.22 million (as at March 31, 2011 : ` 39.22 million) are to be exercised after a period of 12 months from the period end the underlying instruments in respect of the options are unquoted and the company intends to exercise the option, as these transactions have been entered into for strategic reasons. no losses have been identified in respect of the above derivatives necessitating a charge to the Statement of profit and loss. the aggregate exercise price payable is included as part of the company’s commitments (refer note no. 20) b) foreign currency exposures: the period end foreign currency exposures that have not been hedged by a derivative instrument or otherwise are given below: (i) amounts receivable/investments in foreign currency on account of the following: Particulars As at March 31, 2012 ` in million advance towards equity in a subsidiary company investments in subsidiary companies investments in subsidiary companies loans to subsidiary companies 0.02 2,722.34 1,342.76 153.47 4.07 foreign currency in million eur 0.00 eur 41.59 uSD 28.10 uSD 3.00 euro 0.06 As at March 31, 2011 ` in million 0.02 2,722.34 1,340.15 foreign currency in million eur 0.00 eur 41.59 uSD 28.05 -
(ii) amounts payable in foreign currency on account of the following: Particulars As at March 31, 2012 ` in million Fees for legal and technical fees 127.89 foreign currency in million uSD 2.50 As at March 31, 2011 ` in million 92.92 foreign currency in million eur 1.47
c) outstanding forward contracts entered into by the Company: As at Number of contracts 1 Notional Amount USD in million March 31, 2012 30.00
As at
Number of contracts nil
Notional Amount USD in million
March 31, 2011
nil
83
transportation
annual report 2011-12
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 23 : REvENUE fROM OPERATIONS
Year ended March 31, 2012 4,046.83 1,681.97 596.45 21,400.57 27,725.82
` in million Year ended March 31, 2011 4,263.49 1,302.85 496.98 10,094.71 16,158.03
a. sale of services advisory and project development fees Supervision fees operation and maintenance income b. Construction revenue (refer note no.29) ToTAL
NOTE 24 : OTHER INcOME
Particulars a. Interest Income interest on loans interest on advance against property interest on debentures interest on covered warrants interest on call money interest on bank deposits b. Dividend Income on non-current investments c. Profit on sale of fixed assets (net) d. Profit on sale of unquoted long term Investments e. foreign exchange fluctuation gain (net) f. miscellaneous income ToTAL Year ended March 31, 2012 907.86 141.86 72.50 14.09 9.35 0.12 23.60 0.22 74.86 132.18 1,376.64
` in million Year ended March 31, 2011 532.64 123.60 46.66 23.33 0.06 32.51 0.66 40.09 52.22 851.77
NOTE 25 : OPERATINg EXPENSES
Particulars construction contract costs Fees for legal and technical services operation and maintenance expenses ToTAL Year ended March 31, 2012 19,413.92 686.94 371.05 20,471.91
` in million Year ended March 31, 2011 8,705.18 549.66 277.50 9,532.34
NOTE 26 : EMPlOYEE BENEfITS EXPENSE
Particulars Salaries and wages (refer foot note no.1) contribution to provident and other funds (refer foot note no. 2) Staff welfare expenses Deputation cost ToTAL Year ended March 31, 2012 471.51 33.11 89.69 37.00 631.31
` in million Year ended March 31, 2011 430.27 28.71 24.26 28.77 512.01
84
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
foot Note
forming part of the financial statements for the year ended March 31, 2012
1) employee cost is net of salaries of ` 16.73 million (previous year : ` 20.40 million), and contribution to provident and other funds of ` 1.50 million (previous year : ` 1.15 million) towards amounts recovered / recoverable in respect of staff on deputation with other entities 2 employee benefit obligations
(a) Defined-Contribution Plans the company offers its employees defined contribution plans in the form of provident fund, family pension fund and superannuation fund. provident fund, family pension fund and superannuation fund cover substantially all regular employees. contributions are paid during the period into separate funds under certain statutory/fiduciary-type arrangements. while both the employees and the company pay predetermined contributions into the provident fund and pension fund, the contribution to superannuation fund are made only by the company. the contributions are normally based on a certain proportion of the employee’s salary a sum of ` 23.84 million (previous year ` 19.87 million) has been charged to the Statement of profit and loss in this respect (b) Defined–Benefits plans the company offers its employees defined-benefit plans in the form of a gratuity scheme (a lump sum amount). Benefits under the defined benefit plans are typically based on years of service rendered and the employee’s eligible compensation (immediately before retirement). the gratuity scheme covers substantially all regular employees. in the case of the gratuity scheme, the company contributes funds to the life insurance corporation of india which administers the scheme on behalf of the company. commitments are actuarially determined at year-end. actuarial valuation is based on “projected unit credit” method. gains and losses of changed actuarial assumptions are charged to the Statement of profit and loss the net value of the defined-benefit commitment is detailed below: ` in million Particulars present value of commitments Fair value of plans transfer difference (net) prepaid amount taken to the balance sheet for the year ended March 31, 2012 37.29 (46.23) (8.94) for the year ended March 31, 2011 31.29 (39.66) 0.64 (7.73) ` in million Defined benefit Commitments : Gratuity opening balance interest costs current service cost Benefits paid transfer to other employer transfer from other employer actuarial loss closing Balance for the year ended March 31, 2012 31.29 2.39 7.80 (6.29) (0.16) 1.33 0.93 37.29 for the year ended March 31, 2011 22.98 1.85 7.50 (1.05) (3.27) 0.81 2.48 31.29
85
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
` in million Plan Assets: gratuity opening balance expected return on plan assets contributions by the company Benefits paid transfer to other employer transfer from other employer actuarial gain Fair value of plan assets for the year ended March 31, 2012 39.66 3.44 7.99 (6.29) (0.16) 1.33 0.26 46.23 for the year ended March 31, 2011 29.07 2.75 10.46 (1.05) (2.63) 0.81 0.27 39.66 ` in million Return on plan assets: gratuity expected return on plan assets actuarial gain actual return on plan assets expenses on defined benefit plan recognised in the Statement of profit and loss: ` in million Return on plan assets: gratuity current service costs interest expense expected return on investment net actuarial loss charge to the Statement of profit and loss for the year ended March 31, 2012 7.80 2.39 (3.44) 0.67 7.42 for the year ended March 31, 2011 7.50 1.85 (2.75) 2.21 8.82 for the year ended March 31, 2012 3.44 0.26 3.70 for the year ended March 31, 2011 2.75 0.27 3.02
the actuarial calculations used to estimate defined benefit commitments and expenses are based on the following assumptions, which if changed, would affect the defined benefit commitment’s size, funding requirements and pension expense Return on plan assets: gratuity rate for discounting liabilities expected salary increase rate expected return on scheme assets attrition rate Mortality table used Year ended March 31, 2012 Year ended March 31, 2011
8.50% 8.25% 6.50% 6.00% 8.00% 8.00% 2.00% 2.00% lic (1994-96) ultimate table lic (1994-96) ultimate table
the estimates of future salary increases considered in the actuarial valuation take into account inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market the amounts of the present value of the obligation, fair value of the plan assets, surplus or deficit in the plan, experience adjustments arising on plan liabilities and plan assets for the current period and previous four annual periods are given below:
86
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
` in million As at As at As at As at As at March 31, 2012 March 31, 2011 March 31, 2010 March 31, 2009 March 31, 2008 37.29 46.23 8.94 31.29 39.66 0.64 7.73 22.98 29.07 6.09 18.19 22.34 4.15 19.48 21.14 0.08 1.58 ` in million Particulars experience adjustments on plan liabilities gain/(loss) experience adjustments on plan assets gain/(loss) As at As at As at As at As at March 31, 2012 March 31, 2011 March 31, 2010 March 31, 2009 March 31, 2008 (0.27) (0.26) (1.00) (0.27) 0.85 3.10 (6.54) (1.23) (8.91) 0.95
Defined benefit obligations plan assets unfunded liability transferred from group company Surplus
the contributions expected to be made by the company during the financial year 2012-13 is ` 45.09 million
NOTE 27 : fINANcE cOSTS
Particulars a. Interest expenses interest on loans b. other borrowing costs upfront fees and other finance charges ToTAL Year ended March 31, 2012 2,638.80 17.54 2,656.34
` in million Year ended March 31, 2011 1,484.23 70.80 1,555.03
NOTE 28 : ADMINISTRATIvE AND gENERAl EXPENSES
Particulars electricity travelling and conveyance printing and stationery rent (refer note no.32) rates and taxes (including wealth tax) repairs and maintenance (other than building and machinery) communication expenses insurance legal and consultation fees Directors' fees Bank commission Bid documents Foreign exchange fluctuation loss (net) Brand Subscription Fees provision for diminution in value of investments Miscellaneous expenses (refer foot note below) ToTAL Year ended March 31, 2012 6.28 94.92 8.62 114.88 3.01 36.19 19.95 69.16 67.82 1.53 73.94 20.75 218.25 110.00 255.43 1,100.73
` in million Year ended March 31, 2011 4.29 101.08 7.11 78.49 0.96 28.88 14.22 33.33 82.18 1.47 45.54 17.49 4.89 117.68 100.00 157.29 794.90
87
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
foot Note Miscellaneous expenses includes payment to auditors for the following: ` in million Particulars Payment to Auditor as : audit Fees tax audit Fees other Services (assurance) reimbursement of expenses Year ended March 31, 2012 9.50 0.50 6.86 0.14 Year ended March 31, 2011 8.38 0.20 8.04 0.10
Service tax which is being claimed for set off as input credit has not been included in the above
NOTE 29 : DISclOSURE IN RESPEcT Of cONSTRUcTION cONTRAcTS
Particulars contract revenue recognised as revenue during the year Year ended March 31, 2012 21,400.57 As at March 31, 2012 32,667.51 5,500.00 345.77 926.71 1,361.94
` in million Year ended March 31, 2011 10,094.71 ` in million As at March 31, 2011 11,266.94 5,682.74 156.95 475.26 1,420.19
Particulars aggregate revenue recognised up to advances received retention Money gross amount due from customers for contract work, disclosed as asset (i.e. unbilled revenue) gross amount due to customers for contract work, disclosed as liability (i.e. unearned revenue)
NOTE 30 : JOINT vENTURE
the company has the following Joint ventures as on March 31, 2012 and its proportionate share in the assets, liabilities, income and expenditure of the joint venture entities on the basis of the financial statements as at / for the year ended of those entities is given below: ` in million Name of the Jont venture company noida toll Bridge company limited Jorabat Shillong expressway limited n.a.M. expressway limited Percentage of holding Share in Assets 1,633.52 (1,590.34) 1,988.28 (1,210.29) 4,306.29 (2,522.60) Share in liabilities 446.56 (463.94) 1,783.14 (1,003.63) 3,136.57 (1,353.76) Share in contingent liabilities (-) (-) (-) Share in capital commitments Share in Income 256.94 (225.48) (-) 6.26 (14.58) Share in Expenditure 120.56 (117.41) 0.51 (3.34) 3.35 (8.44)
25.35% (25.35%) 50.00% (50.00%) 50.00% (50.00%) Figure in brackets relate to previous year
(-) 1,596.72 (2,400.25) 3,892.73 (6,258.56)
NOTE 31 : INcOME & EXPENDITURE IN fOREIgN cURRENcY
Particulars income - guarantee Fees expenditure Foreign travel legal and consultation Fees Seminar and conference expenses purchase of lab instruments others 88
SaFe SoliD SuStainaBle that’s itnl for you
` in million Year ended March 31, 2012 64.51 0.02 176.20 1.03 32.99 Year ended March 31, 2011 38.47 15.95 86.81 1.64 31.53 3.58
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 32 : lEASE
the company holds certain properties under a non-cancellable operating lease. the company’s future lease rentals under the operating lease arrangements as at the year end are as under: ` in million Particulars future lease rentals : within one year over one year but less than 5 years More than 5 years Amount charged to the statement of Profit and Loss for rent in respect of these properties As at March 31, 2012 54.82 70.31 44.80 70.51 As at March 31, 2011 71.63 132.77 40.54 57.95
the lease terms do not contain any exceptional / restrictive covenants nor are there any options given to company to renew the lease or purchase the properties. the agreements provide for changes in the rentals if the taxes leviable on such rentals change
NOTE 33 : EARNINgS PER SHARE
Particulars profit after tax weighted average number of equity shares outstanding nominal value per equity share Basic / Diluted earnings per share Unit ` in million number ` ` Year ended March 31, 2012 2,522.98 194,267,732 10.00 12.99
` in million Year ended March 31, 2011 2,880.36 194,267,732 10.00 14.83
NOTE 34 : SEgMENT INfORMATION
A. PrImArY - bUsINess segmeNTs ` in million Services for Surface Transportation Business March 31, March 31, 2012 2011 revenue external inter-Segment segment revenue ToTAL reveNUe Segment results less: interest expenses less: other unallocable expenditure add: interest income add: other unallocable income profit before taxation segment assets (a) segment liabilities (b) segment capital employed (a)-(b) capital expenditure Depreciation non cash expenditure other than depreciation 27,725.82 27,725.82 27,725.82 6,001.39 18,924.17 12,633.47 6,290.70 39.68 105.69 16,158.69 16,158.69 16,158.69 5,485.68 17,137.21 10,707.26 6,429.95 95.43 98.13 Unallocated March 31, 2012 2,656.34 585.21 1,145.78 230.86 41,479.66 28,332.27 13,147.39 March 31, 2011 1,555.03 265.03 726.29 125.48 31,392.34 19,974.64 11,417.70 Total March 31, 2012 27,725.82 27,725.82 27,725.82 6,001.39 2,656.34 585.21 1,145.78 230.86 4,136.48 60,403.83 40,965.74 19,438.09 39.68 105.69 115.79 March 31, 2011 16,158.69 16,158.69 16,158.69 5,485.68 1,555.03 265.03 726.29 125.48 4,517.39 48,529.55 30,681.90 17,847.65 95.43 98.13 102.77
89
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
b. seCoNDArY - geogrAPhICAL segmeNTs ` in million India March 31, 2012 revenue external Assets Segment assets capital expenditure 18,858.03 39.68 16,995.27 95.43 66.14 141.94 18,924.17 39.68 17,137.21 95.43 27,725.82 16,158.69 27,725.82 16,158.69 March 31, 2011 Outside India March 31, 2012 March 31, 2011 Total March 31, 2012 March 31, 2011
1) unallocated assets include non-current investments, advance towards share application money, loans given, interest accrued, option premium assets, advance payment of taxes (net), unpaid Dividend accounts and fixed deposits placed with banks 2) unallocated liabilities include borrowings, interest accrued but not due on borrowings, deferred tax liabilities (net), provision for tax (net), option premium liabiities and unpaid dividends
NOTE 35 : RElATED PARTY DISclOSURES
I) CUrreNT YeAr a) name of the related parties and Description of relationship: Nature of Relationship holding Company subsidiaries - Direct Name of Entity infrastructure leasing & Financial Services limited itnl road infrastructure Development company limited gujarat road and infrastructure company limited east Hyderabad expressway limited itnl international pte ltd, Singapore elsamex Sa, vansh nimay infraprojects limited Hazaribagh ranchi expressway limited pune Sholapur road Development company limited west gujarat expressway limited itnl road investment trust Moradabad Bareilly expressway limited Jharkhand road projects implementation company limited chenani nashri tunnelway limited Mp Border checkposts Development company limited Badarpur tollway operations Management limited charminar robopark limited (from July 27, 2011) Futureage infrastructure india linmited (formerly known as global parking plaza limited) (from July 14, 2011) il&FS rail limited (formerly known as itnl enso rail Systems limited) itnl offshore pte ltd, Singapore (from December 5, 2011) Kiratpur ner chowk expressway limited (from February 12, 2012) Karyavattom Sports Facilities limited (from February 8, 2012) Acronym used ilFS iriDcl gricl eHel iipl elSa vnil Hrel pSrDcl wgel irit MBel Jrpicl cntl MpBcDcl BtoMl crl Fiil irl iopl Kncel KSFl
90
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
Nature of Relationship subsidiaries - Indirect
Name of Entity north Karnataka expressway limited elsamex internacional, Sl grusamar ingenieria y consulting, Sl (proyectos De gestion Sistemas calculo y analisis S.a was merged with grusamar effective December 13, 2011) Sánchez Marcos Señalización e imagen, S.a elsamex india private limited cieSM-intevia S.a. Sociedad unipersonal control 7, S. a Mantenimiento y conservacion De vialidades, De c.v eSM Mantenimiento integral De S.a De c.v elsamex portugal S.a intevial-gestao integral rodoviaria S.a grusamar albania SHpK antenea Seguridad y Medico ambiente Sa proyectos y promociones inmobiliarias Sanchez Marcos Sl Senalizacion viales e imagen, Sa yala construction company private limited rapid Metrorail gurgaon limited area De Servicio coiros S.l. conservacion de infraestructuras De Mexico SD De cv alcantarilla Fotovoltaica Sa, Sociedad unipersonal area De Serviceo punta umbria Sl. Sociedad unipersonal il&FS Financial Services limited il&FS education & technology Services limited il&FS energy Development company limited il&FS environmental infrstructure Services limited il&FS infrastructure Development corporation limited il&FS investment Managers limited il&FS Maritime infrastructure company limited chattisgarh Highways Development company limited il&FS Securities Services limited iMicl Dighi Maritime limited Jharkhand accelerated road Development company limited andhra pradesh expressway limited itnl toll Management Services limited thiruvananthpuram road Development company limited warora chandrapur Ballarpur toll road limited noida toll Bridge company limited Jorabat Shillong expressway limited n.a.M. expressway limited Mr K ramchand-Managing Director and relatives Mr Mukund Sapre-executive Director and relatives
Acronym used nKel
elSainD
yccpl rMgl
fellow subsidiaries (only with whom there have been transaction during the year / there was balance outstanding at the year end)
Associates
Jointly Controlled entities Key management Personnel
iFin ietS ieDcl ieiSl iiDcl iiMl iMicl cHDcl iSSl iDMl JarDcl apel itMSl trDcl wcBtrl ntBcl JSel naMel
91
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 35 (i) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
bALANCes: Advance towards share Application money (Long-term) gricl Hrel MpBcDcl otHerS
-
600.00 964.50 936.48 2.32 2,503.30
-
-
-
-
600.00 964.50 936.48 2.32 2,503.30
Trade receivables naMel cntl MpBcDcl pSrDcl otHerS
-
1,241.42 1,045.73 1,945.98 1,582.87 5,816.00
387.15 387.15
728.98 728.98
1,594.66 820.04 2,414.70
-
1,594.66 1,241.42 1,045.73 1,945.98 3,519.04 9,346.83
Interest Accrued - Asset (Current and Non-current) ilFS Jrpicl apel otHerS
14.10 14.10
141.85 30.95 172.80
1.56 1.56
265.56 91.86 357.43
1.17 1.17
-
14.10 141.85 265.56 125.54 547.05
Interest accrued but not due on borrowings nKel
-
24.77 24.77
-
-
-
-
24.77 24.77
Investments in equity shares cntl elSa Jrpicl MBel otHerS
- 3,720.00 - 2,722.34 - 2,280.90 - 2,216.60 - 5,692.61 - 16,632.45
-
952.76 952.76
3,249.13 3,249.13
- 3,720.00 - 2,722.34 - 2,280.90 - 2,216.60 - 9,894.50 - 20,834.34
Investments in Preference shares wgel rMgl
-
296.90 507.50 804.40
-
-
-
-
296.90 507.50 804.40
Investments in Units irit
-
1,038.76 1,038.76
-
-
-
-
1,038.76 1,038.76
92
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 35 (i) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
Investments in Debentures apel
-
-
-
786.40 786.40
-
-
786.40 786.40
Investments in Covered Warrants ilFS
1,693.00 1,693.00
-
-
-
-
-
1,693.00 1,693.00
short-term Lendings apel Hrel eHel iriDcl wgel otHerS
-
500.00 470.00 540.00 425.00 494.47 2,429.47
73.00 73.00
751.00 249.00 1,000.00
330.00 330.00
-
751.00 500.00 470.00 540.00 425.00 1,146.47 3,832.47
Long-term Lendings iipl Jrpicl otHerS
-
1,534.70 1,459.40 1,510.87 4,504.97
-
646.40 646.40
-
-
1,534.70 1,459.40 2,157.27 5,151.37
Short-term Borrowings nKel
-
700.00 700.00
-
-
-
-
700.00 700.00
option premium liabilities irit
-
116.09 116.09
-
-
-
-
116.09 116.09
Trade Payables ilFS elSa otHerS
61.00 61.00
114.39 16.87 131.26
28.73 28.73
8.74 8.74
0.11 0.11
-
61.00 114.39 54.45 229.84
Advances recoverable in Cash or Kind elSa iipl wgel otHerS
-
47.30 18.84 55.35 9.43 130.92
14.51 14.51
1.63 1.63
0.04 0.04
-
47.30 18.84 55.35 25.61 147.10
93
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 35 (i) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
mobilisation Advances received (short-term) JSel cntl MBel pSrDcl otHerS
-
1,160.00 1,024.97 421.02 355.40 2,961.39
-
-
466.40 313.40 779.80
-
466.40 1,160.00 1,024.97 421.02 668.80 3,741.19
mobilisation Advances received Long-term) cntl pSrDcl otHerS
-
1,240.00 215.19 221.21 1,676.40
-
-
82.41 82.41
-
1,240.00 215.19 303.62 1,758.81
retention money receivable JSel Hrel pSrDcl otHerS
-
67.72 150.97 10.97 229.66
-
-
116.11 116.11
-
116.11 67.72 150.97 10.97 345.77
Transactions:
Advance Towards share Application money made Jrpicl MpBcDcl irl otHerS
-
749.25 806.15 715.59 245.30 2,516.29
-
-
0.05 0.05
-
749.25 806.15 715.59 245.35 2,516.34
Interest on Loans (expense) ilFS nKel otHerS
2.96 2.96
66.68 66.68
4.27 4.27
-
-
-
2.96 66.68 4.27 73.91
Inter-corporate deposits matured ilFS
5,020.00 5,020.00
-
-
-
-
-
5,020.00 5,020.00
94
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 35 (i) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives 616.91 616.91 791.00 199.00 990.00 651.00 651.00 330.00 330.00 Total
Inter-corporate deposits - placed ilFS Investments made / purchased ilFS wcBtrl Jrpicl irl otHerS Lendings apel Hrel iipl Jrpicl otHerS borrowings ilFS repayment of Lendings apel eHel iipl otHerS repayment of borrowings ilFS iSSl revenue from operations cntl Hrel MBel naMel otHerS mobilisation Advance received MpBcDcl JSel naMel
4,900.00 4,900.00 1,047.50 1,047.50 800.00 800.00 800.00 800.00 -
749.25 715.59 722.70 2,187.54 750.00 2,525.72 989.40 1,813.57 6,078.69 344.40 790.13 9.00 1,143.53 5,535.99 4,072.38 4,406.23
73.00 73.00 1,000.00 1,000.00
4,900.00 4,900.00 1,047.50 616.91 749.25 715.59 722.70 3,851.95 791.00 750.00 2,525.72 989.40 2,415.57 7,471.69 800.00 800.00 651.00 344.40 790.13 9.00 1,794.53 800.00 1,000.00 1,800.00
390.14 390.14 -
514.20 514.20 3,461.00 1,641.67 5,102.67 134.60 510.20 644.80
- 6,314.51 - 20,329.11 295.90 295.90
5,535.99 4,072.38 4,406.23 3,461.00 - 8,860.52 - 26,336.12 295.90 134.60 510.20 940.70 95
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 35 (i) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
other Income ilFS apel Jrpicl iipl
23.35 23.35
142.71 351.37 494.08
1.73 1.73
230.49 36.54 267.03
30.91 30.91
-
23.35 230.49 142.71 420.55 817.10
Administrative and general expenses ilFS elSa otHerS
302.05 302.05
133.17 133.17
70.01 70.01
-
0.22 0.22
2.75 2.75
302.05 133.17 72.98 508.20
operating expenses elSainD BtoMl otHerS Dividend paid ilFS
472.50 472.50
46.61 69.69 116.30 -
7.80 7.80 -
-
-
-
46.61 69.69 7.80 124.10 472.50 472.50
Director remuneration Mr K ramchand Mr Mukund Sapre
-
-
-
-
-
53.08 28.77 81.85
53.08 28.77 81.85
96
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES
II) PrevIoUs YeAr a) name of the related parties and Description of relationship: Nature of Relationship holding Company subsidiaries - Direct Name of Entity infrastructure leasing & Financial Services limited itnl road infrastructure Development company limited gujarat road and infrastructure company limited east Hyderabad expressway limited itnl international pte ltd, Singapore elsamex Sa, vansh nimay infraprojects limited Hazaribagh ranchi expressway limited pune Sholapur road Development company limited west gujarat expressway limited il&FS rail limited (formerly known as itnl enso rail Systems limited) Moradabad Bareilly expressway limited Jharkhand road projects implementation company limited itnl road investment trust chenani nashri tunnelway limited Mp Border checkposts Development company limited Badarpur tollway operations Management limited north Karnataka expressway limited elsamex internacional, Sl grusamar ingenieria y consulting, Sl Sánchez Marcos Señalización e imagen, S.a proyectos De gestion Sistemas calculo y analisis S.a elsamex india private limited cieSM-intevia S.a. Sociedad unipersonal (formerly known as centro De investigacion elpidio Sanchez Marcos S.a.) control 7, S. a geotecnia 7, S.a Mantenimiento y conservacion De vialidades, De c.v eSM Mantenimiento integral De S.a De c.v elsamex portugal S.a intevial-gestao integral rodoviaria S.a grusamar albania SHpK antenea Seguridad y Medico ambiente Sa proyectos y promociones inmobiliarias Sanchez Marcos Sl Senalizacion viales e imagen, Sa yala construction company private limited rapid Metro rail gurgaon limited Acronym used ilFS iriDcl gricl eHel iipl elSa vnil Hrel pSrDcl wgel irl MBel Jrpicl irit cntl MpcDcl BtoMl nKel
subsidiaries - Indirect
eipl
yccpl rMgl
97
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES
II) PrevIoUs YeAr a) name of the related parties and Description of relationship: Nature of Relationship Name of Entity inversiones tyndrum Sa (upto September 16, 2010. its now merged with elsamex Sa) area De Servicio coiros S.l. (from May 31, 2010) subsidiaries - Indirect conservacion de infraestructuras De Mexico SD De cv (from September 1, 2010) alcantarilla Fotovoltaica Sa, Sociedad unipersonal (from December 17, 2010) area De Serviceo punta umbria Sl. Sociedad unipersonal (from December 17, 2010) il&FS Financial Services limited (erst while il&FS Finvest ltd.) fellow subsidiaries (only il&FS education & technology Services limited with whom there have il&FS energy Development co ltd (from December 3, 2010) been transaction during il&FS environmental infrastructure & Service limited (formerly il&FS waste Management & urban Services limited) the year / there was balance outstanding at the year end) il&FS infrastructure Development corporation limited il&FS Maritime infrastructure company limited il&FS renewable energy limited chattisgarh Highways Development co limited il&FS Securities Services limited il&FS trust company limited Jharkhand accelerated road Development co ltd il&FS cluster Development initiative limited il&FS global Financial Services (uK) limited il&FS urban infrastructure Managers limited il&FS urban infrastructure Services ltd (upto March 29, 2011) andhra pradesh expressway limited itnl toll Management Services limited thiruvananthpuram road Development company limited warora chandrapur Ballarpur toll road limited noida toll Bridge company limited Jorabat Shillong expressway limited n.a.M. expressway limited Mr K ramchand-Managing Director and relatives Mr Mukund Sapre-executive Director and relatives iFin ietS ieDcl ieiSl iiDcl iMicl irel cHDcl iSSl itcl JarDcl icDil igFSl(uK) iuiMl iuiSl apel itMSl trDcl wcBtl ntBcl JSel naMel Acronym used
Associates
Jointly Controlled entities Key management personnel
98
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions with above mentioned related parties (mentioned in note 35 (ii) (a) above)
` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
bALANCes: Advance Towards share Application money (Long Term) gricl Hrel wcBtl otHerS Trade receivables cntl MpBcDcl JSel otHerS option premium assets ilFS Interest Accrued - Asset (Current and Non-current) ilFS apel otHerS Interest accrued but not due on borrowings iSSl nKel Investments in equity shares cntl elSa MBel otHerS Inter-corporate deposits ilFS
1.25 1.25
600.00 724.50 510.72 1,835.22 3,605.25 1,003.50 1,918.65 6,527.40 -
-
616.91 616.91 300.58 300.58 -
0.05 0.05 876.79 677.69 1,554.48 -
-
600.00 724.50 616.91 510.77 2,452.18 3,605.25 1,003.50 876.79 2,896.92 8,382.46 1.25 1.25
0.43 0.43
33.76 33.76
-
319.13 12.15 331.28
-
-
0.43 319.13 45.91 365.47
-
14.76 14.76
34.94 34.94 -
335.85 335.85 -
3,249.13 3,249.13 -
-
34.94 14.76 49.70
- 3,475.90 - 2,722.34 - 2,216.60 - 6,248.30 - 14,663.14 120.00 120.00 -
- 3,475.90 - 2,722.34 - 2,216.60 - 9,833.28 - 18,248.12 120.00 120.00
99
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions with above mentioned related parties (mentioned in note 35 (ii) (a) above)
` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
Investments in Preference shares wgel rMgl Investments in units irit Investments in Debentures apel Investments in Covered Warrants ilFS short-term Lendings wgel apel eHel otHerS Long-term Lendings gricl iriDcl apel Hrel Jrpicl otHerS short-term borrowings iSSl nKel option premium liabilities irit Trade Payables ilFS iFin elSa igFSl (uK) otHerS
648.00 648.00 33.47 33.47
296.90 287.00 583.90 1,038.54 1,038.54 202.50 519.40 83.00 804.90 308.80 213.00 250.00 470.00 1,241.80 700.00 700.00 116.09 116.09 92.92 3.22 96.14
1,000.00 1,000.00 23.82 30.03 0.40 54.25
786.40 786.40 611.00 50.00 661.00 474.60 171.80 646.40 2.69 2.69
-
-
296.90 287.00 583.90 1,038.54 1,038.54 786.40 786.40 648.00 648.00 202.50 611.00 519.40 133.00 1,465.90 308.80 213.00 474.60 250.00 470.00 171.80 1,888.20 1,000.00 700.00 1,700.00 116.09 116.09 33.47 23.82 92.92 30.03 6.31 186.55
100
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions with above mentioned related parties (mentioned in note 35 (ii) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
Advances receivable in cash or in kind elSa wgel otHerS mobilisation Advance received (Long Term) cntl MBel JSel pSrDcl otHerS mobilisation Advance received (short Term) cntl MBel Hrel otHerS retention money receivable Hrel iriDcl JSel
-
141.93 68.60 15.22 225.75
2.45 2.45
8.23 8.23
19.11 19.11
-
141.93 68.60 45.01 255.54
-
1,771.21 482.04 410.72 233.31 2,897.28
-
-
372.22 372.22
-
1,771.21 482.04 372.22 410.72 233.31 3,269.50
-
628.80 919.20 439.74 393.32 2,381.06 70.20 47.65 117.85
-
-
32.18 32.18 39.10 39.10
-
628.80 919.20 439.74 425.50 2,413.24 70.20 47.65 39.10 156.95
Transactions:
Advance Towards share Application money made cntl MpBcDcl wcBtl otHerS Interest on Lons (expense) ilFS iSSl nKel Inter-corporate deposits matured ilFS
53.00 53.00
244.10 213.60 123.00 580.70
-
616.91 616.91
0.05 0.05
-
244.10 213.60 616.91 123.05 1,197.66 53.00 49.01 17.45 119.46
17.45 17.45
49.01 49.01 -
7,980.00 7,980.00
-
-
-
-
-
7,980.00 7,980.00
101
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions with above mentioned related parties (mentioned in note 35 (ii) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives 221.80 45.00 266.80 264.00 264.00 354.08 354.08 1,167.55 210.00 1,377.55 1,886.98 1,886.98 Total
Inter-corporate deposits - placed ilFS Investments made / purchased ilFS cntl MBel pSrDcl naMel otHerS Lendings eHel Hrel Jrpicl trDcl otHerS repayment of Lendings eHel iriDcl apel otHerS repayment of borrowings ilFS otHerS borrowings ilFS nKel iSSl sale of Assets ilFS revenue from operations cntl MpBcDcl otHerS Administrative and general expenses ilFS elSa 102
SaFe SoliD SuStainaBle
8,100.00 8,100.00 148.00 148.00 5,580.00 5,580.00 5,580.00 5,580.00 0.07 0.07
3,475.90 2,216.10 1,599.50 948.25 8,239.75 609.40 250.00 470.00 441.70 1,771.10 90.00 109.50 107.09 306.59 50.00 50.00 750.00 750.00 -
1,000.00 1,000.00 -
8,100.00 8,100.00 148.00 3,475.90 2,216.10 1,599.50 1,167.55 1,158.25 9,765.30 609.40 250.00 470.00 221.80 486.70 2,037.90 90.00 109.50 264.00 107.09 570.59 5,580.00 50.00 5,630.00 5,580.00 750.00 1,000.00 7,330.00 0.07 0.07
- 4,451.29 - 4,032.81 - 6,133.42 - 14,617.52
- 4,451.29 - 4,032.81 - 8,374.48 - 16,858.58
202.66 -
173.14
-
-
-
-
202.66 173.14
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions with above mentioned related parties (mentioned in note 35 (ii) (a) above) ` in million Particulars Holding company 202.66 Subsidiaries 173.14 23.23 23.23 38.47 39.61 90.99 169.07 412.00 412.00 114.33 114.33 2,400.00 1,401.25 663.19 4,464.44 fellow Subsidiaries 14.21 11.03 1.03 26.27 26.60 30.03 56.63 0.33 0.33 Associates 227.85 13.50 241.35 0.25 0.25 Jointly controlled Entities 0.22 0.22 23.60 23.60 Key Management personnel and relatives 0.74 0.74 Total
ietS itcl otHerS other borrowing costs iFin igFSl (uK) operating expenses BtoMl other Income elSa gricl apel ilFS ntBcl otHerS refund of Advance Towards share Application money nKel otHerS sale of shares irit mobilisation Advance received cntl MBel otHerS Dividend paid ilFS Director remuneration Mr. K ramchand Mr. Mukund Sapre
14.21 11.03 1.99 403.03 26.60 30.03 56.63 23.23 23.23 38.47 39.61 227.85 23.27 23.60 104.82 457.62 412.00 0.25 412.25 114.33 114.33 2,400.00 1,401.25 1,067.59 4,868.84 405.00 405.00 36.85 21.48 58.33
23.27 23.27 405.00 405.00 -
-
-
404.40 404.40 -
36.85 21.48 58.33
103
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 36 : DISclOSURE Of lOANS AND ADvANcES IN THE NATURE Of lOANS TO SUBSIDIARIES AND ASSOcIATES
` in million Name of company March 31, 2012 March 31, 2011
Amount Maximum Amount Maximum as at amount as at amount March 31, outstanding March 31, outstanding 2012 during the year 2011 during the year subsidiaries east Hyderabad expressway limited gujarat road and infrastructure company limited itnl international pte. ltd., Singapore itnl road infrastructure Development company limited vansh nimay infraprojects limited west gujarat expressway limited elsamex india private limited il&FS rail limited (Formerly Known as itnl enso rail Systems limited) Hazaribagh ranchi expressway limited Jharkhand road projects implementation company limited Mp Border checkposts Development company limited pune Sholapur road Development company limited elsamex S.a., Spain Associates andhra pradesh expressway limited thiruvananthapuram road Development company limited warora chandrapur Ballarpur toll road limited 1,225.60 386.80 34.00 1,555.60 386.80 34.00 1,085.60 221.80 1,304.60 221.80 470.00 308.80 1,688.16 753.00 173.00 425.00 6.00 1,000.00 1,459.40 485.00 162.00 4.07 644.40 308.80 2,525.72 753.00 173.00 425.00 15.00 1,000.00 1,459.40 485.00 162.00 4.07 519.40 308.80 213.00 83.00 202.50 250.00 470.00 519.40 308.80 322.50 110.00 202.50 30.09 50.00 250.00 470.00 -
NOTE 37 :
consequent to the notiFication no. S.o. 447(e), DateD 28-2-2011 [aS aMenDeD BynotiFication no. F.no. 2/6/2008-cl-v, DateD 30-3-2011] the above financial statements have been presented in accordance with the revised Schedule vi. as required under the said notification corresponding figures for the previous year have been reclassified and presented in accordance with the current year presentation
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012
104
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Auditors’ Report
NeTWorKs LImITeD
IL&Fs Transportation Networks Limited
to the Board of Directors of IL&fs TrANsPorTATIoN
2. we conducted our audit in accordance with the auditing standards generally accepted in india. those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. an audit includes examining, on a test basis, evidence supporting the amounts and the disclosures in the financial statements. an audit also includes assessing the accounting principles used and the significant estimates made by the Management, as well as evaluating the overall financial statement presentation. we believe that our audit provides a reasonable basis for our opinion 3. we did not audit the financial statements of sixteen subsidiaries, whose financial statements reflect total assets of ` 82,427.29 million as at March 31, 2012, total revenues of ` 41,839.26 million and net cash outflows amounting to `. 2,058.65 million for the year ended on that date as considered in the consolidated Financial Statements. we also did not audit the financial statements of four jointly controlled entities, in which the group’s proportionate share in total assets is `. 22,604.04 million as at March 31, 2012, in total revenues is ` 4,212.62 million and in net cash outflows is ` 905.49 million as considered in the consolidated Financial Statements. the financial statements of
1. we have audited the attached consolidated Balance Sheet of il&FS tranSportation networKS liMiteD (“the company”), its subsidiaries and jointly controlled entities / operations (the company, its subsidiaries and jointly controlled entities / operations constitute “the group”) as at March 31, 2012, the consolidated Statement of profit and loss and the consolidated cash Flow Statement of the group for the year ended on that date, both annexed thereto. the consolidated Financial Statements include investments in associates accounted on the equity method in accordance with accounting Standard 23 (accounting for investments in associates in consolidated Financial Statements) and the jointly controlled entities / operations accounted in accordance with accounting Standard 27 (Financial reporting of interests in Joint ventures) as notified under the companies (accounting Standards) rules, 2006. these financial statements are the responsibility of the company’s Management and have been prepared on the basis of the separate financial statements and other financial information regarding components. our responsibility is to express an opinion on these consolidated Financial Statements based on our audit
105
transportation
annual report 2011-12
these twenty entities have been audited by other auditors whose reports have been furnished to us and our opinion in so far as it relates to the amounts included in respect of these entities, is based solely on the reports of the other auditors 4. the consolidated financial statements also include the group’s share of net loss of three associates, which have been accounted based on the equity method in accordance with accounting Standard 23 (accounting for investments in associates in consolidated Financial Statements), in respect of which ` 232.03 million being the group’s proportionate share of loss of the associates from the date of acquisition upto March 31, 2012 has been recognised (includes share of loss of ` 87.78 million for the year ended March 31, 2012). these financial statements have been audited by other auditors whose reports have also been furnished to us and our opinion, insofar as they relate to the amounts included in respect of these associates, is based solely on the report of the other auditors 5. the consolidated financial statements include the group’s proportionate share in the profit of one associate from the date of acquisition upto December 31, 2011 amounting to `19.91 million (including share of profit of `19.95 million for the period then ended) based on the unaudited financial statements as at / for the nine months ended December 31, 2011. there is no financial information available with the Management thereafter
6. without qualifying our opinion, we draw attention to note 13 and note 19 to the consolidated financial statements, wherein significant elements of the consolidated financial statements have been determined based on management estimates (which in turn are based on technical evaluations by independent experts). these include: (i) intangible assets and intangible assets under Development covered under service concession arrangements aggregating to carrying value of ` 62,146.93 million (40.76% of the total assets), the useful lives and the annual amortisation thereof; (ii) provision for overlay carried at ` 681.40 million in respect of intangible assets covered under service concession arrangements; and (iii) Financial assets covered under service concession arrangements, included as a part of receivables against Service concession arrangements, carried at ` 46,789.80 million (30.69% of the total assets) and revenue recognised thereon based on the effective interest method which in turn is based on evaluations of the future operating and maintenance costs and the overlay / renewal costs and the timing thereof 7. we report that the consolidated Financial Statements have been prepared by the company in accordance with the requirements of accounting Standard 21 (consolidated Financial Statements), accounting
106
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Standard 23 (accounting for investment in associates in consolidated Financial Statements) and accounting Standard 27 (Financial reporting of interests in Joint ventures) as notified under the companies (accounting Standards) rules, 2006 8. Based on our audit and on consideration of the separate audit reports on individual financial statements of the company, its aforesaid subsidiaries, joint ventures and associates and to the best of our information and according to the explanations given to us, in our opinion, the consolidated Financial Statements, read with our comments in paragraph 6 above and subject
to our comments in paragraph 5 above, give a true and fair view in conformity with the accounting principles generally accepted in india: (i) in the case of the consolidated Balance Sheet, of the state of affairs of the group as at March 31, 2012; (ii) in the case of the consolidated Statement of profit and loss, of the profit of the group for the year ended on that date and (iii) in the case of the consolidated cash Flow Statement, of the cash flows of the group for the year ended on that date
For DeLoITTe hAsKINs & seLLs chartered accountants (Firm registration no. 117366w)
Kalpesh J. Mehta partner Bengaluru, May 4, 2012 (Membership no. 48791)
107
transportation
annual report 2011-12
Consolidated Balance sheet
Particulars eQUITY AND LIAbILITIes shArehoLDers' fUNDs (a) Share capital (b) reserves and surplus mINorITY INTeresT NoN-CUrreNT LIAbLITIes (a) long-term borrowings (b) Deferred tax liabilities (net) (c) other long term liabilities (d) long-term provisions CUrreNT LIAbILITIes (a) current maturities of long-term debt (b) current maturities of finance lease obligations (c) Short-term borrowings (d) trade payables (e) other current liabilities (f) Short-term provisions ToTAL AsseTs NoN CUrreNT AsseTs (a) Fixed assets (net) (i) tangible assets (ii) intangible assets (iii) capital work-in-progress (iv) intangible assets under development (b) (c) (d) (e) (f) goodwill on consolidation (net) non-current investments Deferred tax assets long-term loans and advances other non-current assets Note
as at 31.03.2012
` in million As at March 31, 2012 As at March 31, 2011
2 3 4,5 6 8 9 11
1,942.68 25,695.22
27,637.90 2,934.65
1,942.68 20,449.53
22,392.21 2,175.13
69,737.62 2,046.51 2,291.01 750.91 10,525.53 65.22 21,930.82 11,304.42 1,860.04 1,395.19
74,826.05
35,990.11 1,438.65 1,113.61 691.78 7,594.31 128.97 10,235.07 9,884.69 1,458.73 1,122.69
39,234.15
7 10 12
47,081.22 152,479.82
30,424.46 94,225.95
13 1,251.63 27,612.84 195.20 34,812.66 14 8 16 18 15 20 21 22 17 19 5,265.68 3,831.91 5.23 7,944.32 48,690.68 122.22 210.10 8,820.13 2,837.87 9,198.44 1,680.91 1,104.14 12,915.10 10.32 15,755.81 2,795.59 1,919.88 116.75 5,927.69 25,933.80 89.29 262.17 7,489.01 5,275.46 10,926.89 3,704.05
63,872.33
29,785.37
65,737.82
36,693.71
CUrreNT AsseTs (a) current investments (b) inventories (c) trade receivables (d) cash and cash equivalents (e) Short-term loans and advances (f) other current assets
22,869.67 152,479.82
27,746.87 94,225.95
ToTAL notes 1 to 40 form part of the consolidated financial statements in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 108
SaFe SoliD SuStainaBle that’s itnl for you
Bengaluru, May 4, 2012
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Consolidated statement of Profit and Loss
for the Year Ended March 31, 2012
` in million Note I) II) III) reveNUe from oPerATIoNs oTher INCome ToTAL reveNUe (I + II) 24 25 Year ended March 31, 2012 56,056.21 1,238.07 57,294.28 Year ended March 31, 2011 40,482.26 786.28 41,268.54
Iv) exPeNses cost of materials consumed operating expenses employee benefits expense Finance costs Depreciation and amortization expense administrative and general expenses ToTAL exPeNses (Iv) v) ProfIT before TAxATIoN (III-Iv)
26 27 28 29 30
1,242.04 33,254.59 3,693.91 7,282.07 765.52 3,210.18 49,448.31 7,845.97
1,370.29 21,825.02 3,521.58 4,980.58 614.19 2,217.10 34,528.76 6,739.78
vI) TAx exPeNse: (1) current tax (2) Deferred tax (net) ToTAL TAx exPeNses (vI) vII) ProfIT for The YeAr before CoNsoLIDATIoN ADJUsTmeNTs (v-vI) vIII) Share of profit transferred to minority interest (net) Ix) Share of profit / (loss) of associates (net) ProfIT for The YeAr (vII+vIII+Ix) earnings per equity share (Face value per share `10/-): (1) Basic (2) Diluted notes 1 to 40 form part of the consolidated financial statements 31
1,830.94 626.27 2,457.21 5,388.76
1,700.20 542.25 2,242.45 4,497.33
(457.71) 38.53 4,969.58
(120.73) (47.81) 4,328.79
25.48 25.48
22.19 22.19
in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 Bengaluru, May 4, 2012 109
transportation
annual report 2011-12
Consolidated Cash Flow statement
for the Year Ended March 31, 2012
` in million Year Ended March 31, 2012 CAsh fLoW from oPerATINg ACTIvITIes profit Before taxes, Minority interest and Share of associates Adjustments for interest income profit on sale of investments (net) Dividend income Finance costs loss on sale of fixed assets (net) provision for employee benefits (net) Depreciation and amortization expense provision for Bad and Doubtful Debts provision for overlay expenses provision for dimunition in value of investments Foreign currency transalation reserve preliminary expense written off excess provisions written back operating profit before Working Capital Changes Adjustments changes in working capital: increase in trade receivables (Decrease) / increase in other assets & loans and advances (current and non current) increase in liabilities (current and non current) Cash generated from operations Direct taxes paid (net) Net Cash generated from operating Activities (A) CAsh fLoW from INvesTINg ACTIvITIes additions to fixed assets increase in receivable against Service concession arrangements (net) proceeds from sale of fixed assets purchase of / advance towards investments (net) acquisition of Subsidiaries / Jointly controlled entities Sale proceeds of investments proceeds from redemption of Mutual Fund units (net) long term loans given long term loans recovered Short term loans given (net) interest received Dividend received Fixed deposits for periods exceeding 3 months placed (net) inter-corporate deposits placed (net) advance against property Net Cash used in investing Activities (b) 7,845.97 (930.95) (8.58) (2.10) 7,282.07 2.97 0.66 765.52 316.85 130.48 (37.03) 186.43 0.04 (33.06) 15,519.27 Year Ended March 31, 2011 6,739.78 (691.06) (4.27) (10.37) 4,980.58 9.98 16.96 614.19 51.99 115.74 6.00 206.19 0.11 (0.05) 12,035.77
(1,634.23) 2,099.30 2,264.86 18,249.20 (1,962.04) 16,287.16
(1,062.91) (5,086.08) 5,398.42 11,285.20 (2,012.56) 9,272.64
(19,716.25) (21,520.44) 76.68 (1,267.63) (19,130.97) 29.68 (1,538.18) 17.40 (741.87) 637.30 2.10 (255.89) (403.30) (53,811.38)
(14,148.98) (13,220.55) 15.38 (1,150.27) (15.34) 381.66 2,505.80 (699.90) 234.79 581.63 10.37 (529.43) (247.43) (149.43) (26,431.70)
110
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Consolidated Cash Flow statement
for the Year Ended March 31, 2012
` in million Year Ended March 31, 2012 CAsh fLoW from fINANCINg ACTIvITIes Share issue expenses paid (Decrease)/ increase in advance towards capital proceeds from borrowings repayments of borrowings Finance costs paid Dividend payment tax on Dividend paid capital grant received proceeds from minority interest Net Cash generated from financing Activities (C) Net Decrease in Cash and Cash equivalents (A+b+C) cash and cash equivalent at the beginning of the year cash and cash equivalent at the end of the year Net Decrease in Cash and Cash equivalents notes: Components of Cash and Cash equivalents cash on Hand Balances with Banks in current accounts Fixed deposits placed for a period less than 3 months unpaid Dividend accounts cash and cash equivalents on acquisition of Joint venture Fixed deposits placed for a period exceeding 3 months cash and cash equivalents as per note 22 notes 1 to 40 form part of the consolidated financial statements 14.81 1,393.84 183.08 1,591.73 0.35 74.25 1,171.54 2,837.87 16.10 1,920.54 2,423.06 4,359.70 0.11 915.65 5,275.46 50,216.83 (10,232.23) (6,740.31) (687.83) (106.47) 1,929.09 377.16 34,756.24 (2,767.97) 4,359.70 1,591.73 (2,767.97) (195.33) 61.00 43,782.33 (22,583.05) (4,684.97) (592.00) (91.64) 411.55 294.95 16,402.84 (756.22) 5,115.92 4,359.59 (756.33) Year Ended March 31, 2011
in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 Bengaluru, May 4, 2012 111
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE - 1: PRINcIPlES Of cONSOlIDATION, SIgNIfIcANT AccOUNTINg POlIcIES
A. bAsIs of CoNsoLIDATIoN: (a) the consolidated Financial Statements (“cFS”) relates to il&FS transportation networks limited (the “company”), its subsidiaries, jointly controlled entities and associates. the company and its subsidiaries constitute “the group” (b) the cFS has been prepared under the historical cost convention in accordance with the generally accepted accounting principles (“gaap”) in india, as adopted by the company and the applicable accounting Standards notified under section 211 (3c) of the companies act, 1956. all income and expenditure having a material bearing on the financial statements are recognised on accrual basis (c) the preparation of the financial statements requires the management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including current liabilities) as of the date of the financial statement, the reported income and expenses during the reporting period and disclosure of contingent liabilities. Management believes that the estimates used in the preparation of its financial statements are prudent and reasonable. actual results could differ from these estimates b. PrINCIPLes of CoNsoLIDATIoN: (a) the cFS has been prepared by the company in accordance with accounting Standards (aS) 21 on “consolidated Financial Statements”, aS 27 on “Financial reporting of interests in Joint ventures” and aS 23 on “accounting for investments in associates in consolidated Financial Statements” investments in associates are accounted for under the equity method in accordance with aS 23 on “accounting for investments in associates in consolidated Financial Statements” the financial statements of the company and its subsidiaries have been combined on a line by line basis by adding together the book values of like items of assets, liabilities, income and expenses after eliminating intragroup balances and intra-group transactions resulting in unrealised profits or losses in case of foreign subsidiaries, revenue items are consolidated by applying the average rate prevailing during the period to the foreign currency amounts. all assets and liabilities are consolidated by applying the rates prevailing at the period end to the foreign currency amounts. Shareholder’s funds are consolidated by applying the transaction date rates to the foreign currency amounts (b) the accounting policies of subsidiaries have been adjusted, as necessary and to the extent practicable, so as to ensure consistent accounting within the group (c) the excess of cost of the group’s investments in each subsidiary, jointly controlled entity and associates over the group’s share in equity of such entities, at the date on which such investment is made, is recognised as goodwill and included as an asset in the consolidated Balance Sheet. the excess of the group’s share in equity of each subsidiary, jointly controlled entity and associates at the date on which the investment is made, over the cost of the investment is recognised as capital reserve and included as reserves and Surplus under Shareholders’ equity in the consolidated Balance Sheet (d) Minority interest in the net assets of subsidiaries consists of amounts of equity attributable to the minority shareholders at the dates on which investments are made by the company in the subsidiaries and further movements in their share in the equity, subsequent to the dates of investments (e) the financial statements of the subsidiaries, associates and joint ventures used in the consolidation are drawn up to the same reporting date as that of the company i.e. March 31, 2012 except for one overseas subsidiary viz. elsamex S.a. whose audited financial statements (incorporating the financial statements of its subsidiaries, jointly controlled operations and its associates) have been drawn for a period of twelve months up to December 31, 2011 and adjusted for effects of significant transactions and other events that have occurred between January 1, 2012 and March 31, 2012 112
SaFe SoliD SuStainaBle that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
C. the list of subsidiaries, which are included in the cFS with their respective country of incorporation and the group’s holding therein for each of the financial years are givenbelow: Name of the Subsidiary country of Incorporation Proportion of group’s Interest (%) 2011-12 2010 - 11 83.61 100.00 74.00 100.00 69.29 100.00 100.00 90.00 74.00 83.61 100.00 74.00 100.00 Date of Acquisition of control
1. held directly: gujarat road and infrastructure company limited (“gricl”) Scheme of itnl road investment trust (“irit”) east Hyderabad expressway limited (“eHel”) itnl road infrastructure Development company limited (“iriDcl”) il&FS rail limited (formerly known as itnl enso rail Systems limited ) (“enSo”) elsamex Sa (includes 22.61 % shares held through iipl, previous year 22.61%) (“elsamex”) itnl international pte. ltd. (“iipl”) vansh nimay infraprojects limited (“vnil”) west gujarat expressway limited (“wgel”) [through control over the composition of Board of Directors as at March 31, 2011] Hazaribagh ranchi expressway limited (“Hrel”) pune Sholapur road Development company limited (“pSrDcl”) Moradabad Bareilly expressway limited (“MBel”) Jharkhand road projects implementation company limited (“Jrpicl”) chenani nashri tunnelway limited (“cntl”) Mp Border checkpost Development company limited (“MpBcDcl”) Badarpur tollway operations Management limited (“BtoMl”) Futureage infrastructure india limited (“Fiil”) [formerly known as global parking plaza limited ] charminar robopark limited (“crl”) itnl offshore pte. ltd. (“iopl”) Karyavattom Sports Facility limited (“KSFl”) Kiratpur ner chowk expressway limited (“Kncel”) 2. held through subsidiaries: north Karnataka expressway limited (“nKel”) proyectos y promociones inmobilarias Sanchez Marcos Sl atenea Seguridad y Medio ambiente S.a. proyectos De gestion Sistemas calculo y analisis S.a Sanchez Marcos Senalizacion e imagen S.a. Senalizacion viales e imagen S.u. elsamex internacional Sl grusamar ingenieria y consulting, S.l. elsamex portugal enghenería e Sistemas de gestao S.a. intevial gestao integral rodoviaria, S.a. elsamex india private limited yala construction co private limited Mantenimiento y conservacion de vialidades S.a. de c.v. eSM Mantenimiento integral de Sa de cv
india india india india india Spain Singapore india india
January 11, 2007 March 13, 2007 September 5, 2007 January 17, 2008
57.50 February 4, 2008 100.00 March 18, 2008 100.00 September 19, 2008 90.00 March 25, 2009 49.00 June 10, 2009 (initial control) 74.00 august 1, 2009 100.00 September 25, 2009 100.00 February 4, 2010 98.05 February 27, 2010 100.00 June 2, 2010 51.00 october 28, 2010 99.99 December 9, 2010 - July 14, 2011 July 27, 2011 December 5, 2011 February 8, 2012 February 12, 2012
india india india india india india india india india Singapore india india
74.00 100.00 100.00 93.04 100.00 51.00 100.00 61.22 97.85 100.00 99.88 100.00
india Spain Spain Spain Spain Spain Spain Spain portugal portugal india india Mexico Mexico
87.00@ 100.00 $ 100.00 $ 100.00 $ 100.00 $ 100.00 $ 100.00 $ 100.00 $ 73.50 $ 100.00 $ 99.15 $ 86.78 $ 64.00 $ 100.00 $
87.00@ 100.00 * 100.00 * 100.00 * 100.00 * 100.00 * 100.00 * 100.00 * 73.50 * 100.00 * 99.15 * 88.78 * 64.00 * 100.00 *
March 21, 2007 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008
113
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Name of the Subsidiary
country of Incorporation Spain Spain Spain albania india Spain Mexico Spain Spain
ciSeM-intevia, S.a. control 7, S.a. geotecnia 7, S.a.u. grusamar albania SHpK rapid Metrorail gurgaon limited (“rMgl”) area De Servicio coiros S.l.u. conservacion De infraestructuras De Mexico S.a. De c.v. alcantarilla Fotovoltaica, S.l. area De Servicio punta umbria, S.l.u.
$ * @ #
Proportion of group’s Interest (%) 2011-12 2010 - 11 100.00 $ 100.00 * 100.00 $ 100.00 * 100.00 $ 100.00 * 51.00 $ 51.00 * 59.26# 53.60# 100.00 $ 100.00 * 96.40 $ 96.40 * 100.00 $ 100.00 * 100.00 $
Date of Acquisition of control
March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 July 30, 2009 May 31, 2010 September 1, 2010 December 17, 2010 100.00 * December 17, 2010
proportion of group’s interest as at December 31, 2011 proportion of group’s interest as at December 31, 2010 out of the above 13.00% is held directly by the company and balance 74.00% through the scheme of irit (previous year 13.00% held by the company and balance 74.00% through the scheme of irit). out of the above 26.00% is directly held by the company and balance 33.26% through enSo (previous year 26.00% held by company and balance 27.60% held through enSo)
the financial position and results (before eliminations) of KSFl, Kncel, iopl,Fiil and crl which became subsidiaries during the year ended March 31, 2012 are given below: fIIl March 31, 2012 44.66 20.16 64.82 cRl March 31, 2012 4.42 0.17 4.59 KNcEl March 31, 2012 84.13 388.13 472.26 KSfl March 31, 2012 0.26 62.63 62.89 IOPl March 31, 2012 2.12 0.10 2.22 March 31, 2012 2.22 2.22 0.43 0.43 (0.43) (0.43)
Equity and liabilities as at Shareholders’ Funds (including share application money) current liabilities
Assets as at
March 31, March 31, March 31, March 31, 2012 2012 2012 2012 3.11 435.69 62.74 Fixed assets (net Block) investments 0.18 long term loans and advances 60.88 0.65 4.59 36.57 0.15 current assets 64.82 4.59 472.26 62.89 Income for the period (from the date of incorporation / acquisition to march 31, 2012) 343.70 operating income ToTAL INCome 343.70 expense for the period (from the date of incorporation / acquisition to march 31, 2012) 343.70 operating expenses Depreciation 0.72 2.49 1.06 1.35 0.07 other administrative expenses ToTAL exPeNses 3.21 1.06 345.05 0.07 loss for the period before tax (3.21) (1.06) (1.35) (0.07) taxes loss for the period after tax (3.21) (1.06) (1.35) (0.07)
114
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
the financial position and results (before eliminations) of cntl, MpBcDcl, BtoMl which became subsidiaries during the previous year ended March 31, 2011 are given below: Equity and liabilities as at Shareholders’ Funds (including application money) non-current liabilities current liabilities cNTl March 31, 2011 3,777.64 164.88 3,952.69 7,895.21 March 31, 2011 1.46 7,633.15 260.60 7,895.21 MPBcDcl March 31, 2011 270.15 2,232.83 2,502.98 March 31, 2011 2,239.27 167.12 96.59 2,502.98 BTOMl March 31, 2011 1.31 0.04 10.11 11.46 March 31, 2011 0.05 0.06 11.35 11.46
share
Assets as at
Fixed assets (net block) long term loans and advances, other non current assets current assets
Income for the period (from the date of incorporation / acquisition to march 31, 2011) 5,071.06 2,235.93 construction contract revenue effective interest 162.09 0.40 other income ToTAL INCome 5,233.55 2,235.93 expense for the period (from the date of incorporation / acquisition to march 31, 2011) 4,615.37 2,235.93 construction contract costs operation & other expenses 27.64 3.95 interest and finance charges 505.20 Depreciation ToTAL exPeNses 5,148.21 2,239.88 profit/(loss) for the period before tax 85.34 (3.95) taxes (27.69) profit/(loss) for the period after tax 57.65 (3.95) D. INTeresT IN JoINTLY CoNTroLLeD eNTITIes:
23.27 23.27
21.98 0.12 22.10 1.17 (0.36) 0.81
(a) the financial statements (consolidated financial statements where applicable) of jointly controlled entities have been consolidated on a line by line basis by adding together the book values of like items of assets, liabilities, income and expenses after eliminating intra-group balances and intra-group transactions resulting in unrealised profits or losses as required by aS 27 using the proportionate consolidation method (b) the accounting policies in the jointly controlled entities have been adjusted as necessary and to the extent practicable, so as to ensure consistent accounting with the policies stipulated by the company
115
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
(c) the group’s interest in jointly controlled entities are: Date of country of Acquisition of Joint Incorporation control Proportion of group’s Interest (%) 2011-12 2010 - 11
Name of the company
held Directly : noida toll Bridge company limited (“ntBcl”) n.a.M. expressway limited (“nel”) Jorabat Shillong expressway limited (“JSel”) held through subsidiaries : geotecnia y control De Qualitat, S.a. chongqing yuhe expressway co. ltd. (“yuhe”) footnote: (i) ntBcl includes itnl toll Management Services limited subsidiary of ntBcl, which is also an associate of the company (ii) (iii)
$ *
india india india
various dates June 15, 2010 June 18, 2010
25.35 50.00 50.00
25.35 50.00 50.00
Spain china
July 15, 2010 December 27, 2011
50.00 $ 49.00
50.00 * -
proportion of group’s interest as at December 31, 2011 proportion of group’s interest as at December 31, 2010
e. INTeresT IN JoINT CoNTroLLeD oPerATIoNs : (a) the financial statements (including consolidated financial statements where applicable) of the jointly controlled operations have been consolidated on a line by line basis by adding together the book values of like items of assets, liabilities, income and expenses after eliminating intra-group balances and intra-group transactions resulting in unrealised profits or losses as required by aS 27 using the proportionate consolidation method. the financial statements of the jointly controlled operations are prepared by the respective operators in accordance with the requirements prescribed by the joint operating agreements of the jointly controlled operations (b) the accounting policies of jointly controlled operations have been adjusted as necessary and to the extent practicable, so as to ensure consistent accounting with the policies stipulated by the company (c) the group’s interest in jointly controlled operations are : Name of the Jointly controlled Operations Proportion of group’s Interest (%) 2011-12 $ ute elsamex arias elsamex-arias ute conservación coruña ii elsamex-infraestructuras terrestres elsamex- Modecar ute chenlo ute elsamex arias oca conservación orense ute elsamex grusamar ute elsamex-alpidesa elsamex-iberseñal ute Señalización Madrid elsamex-opsa ute peri Serrano uribe elsamex-Fitonovo ute casa Del Queso elsamex-const.cesfer ute San Jerónimo elsamex-torrescamara ute presas grusamar-elsamex-atenea ute Seguridad vial Murcia 116
SaFe SoliD SuStainaBle that’s itnl for you
2010 - 11* 75% 60% 80% 80% 50% 50% 50% 60% 80% 50% 50% 50% 30%
75% 60% 80% 80% 50% 50% 60% 80% 50% 50% 30%
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Name of the Jointly controlled Operations
Proportion of group’s Interest (%) 2011-12 $ 2010 - 11* 80% 50% 50% 50% 50% 50% 50% 50% 50% 45% 50% 50% 50% 40% 60% 50% 50% 50% 50% 50% 50% 50% 70% 28% 50% 50% 50% 50% 50% 25% 25% 25% 25% 25% 25% 25% 20% 20% 60% 80% 70% 50% 50% 40% 50% 50% 50% 50% 50% 50% 50% 50% 50% 117 80% 50% 50% 50% 50% 50% 50% 50% 50% 45% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 70% 28% 50% 50% 50% 50% 50% 25% 25% 25% 25% 25% 25% 20% 60% 80% 70% 50% 50% 40% 50% 50% 50% 50% 50% 50% 50% 50% 50%
elsamex-cauchil ute elsamex- cauchill Jaen cauchil – elsamex ute guadahortuna elsamex-cauchil ute Sierra nevada elsamex-cauchil ute estepona elsamex- prointec ute r4 api conservacion-elsamex ute teruel ii elsan pacsa-elsamex ute navalvillar De pela ii elsamex-Sando ute ii conservación a-395 elsamex-Sando ute refuerzo Del Firme a-395 elsamex-asfaltos uribe este Señal ute Durango ii elsamex-lopesan ute conservación Zona Sur Serop-elsamex ute Mantenimiento Serop-elsamex elsamex-const.Hispánica ute peaje la Jonquera ute elsamex Mag 3 ute Mag 3 elsamex elsamex-asfaltos urretxu ute itziar elsamex-tractores y obras ute elsamex-tyosa obras públicas elsamex-velasco ute polideportivos latina elsamex-velasco ute polideportivos Hortaleza elsamex-velasco ute polideportivos tetuán corsan corviam-elsamex ute corelsa elsamex-oca ute coruña iii asfaltos uribe-norte industrial-construcciones eder-elsamex ute vizcaya ii elsamex-rubau ute argentona elsamex- Martín casillas ute conservación cádiz Sice-elsamex ute Sice Fuente el Fresno ii elsamex-vimac ute vimac 01 elsamex-oca ute conservación orense ii ute abedul orihuela ute area Zamora ute abedul Zamora ute area leon ute abedul villavidel ute abedul cáceres ute abedul ponferrada atenea – grusamar ute andalucía atenea – grusamar ute asturias grusamar- consulting proyectos y Sistemas ute variante Sueca grusamar – Kv consultores ute puerto De Mahon grusamar – progescan ute areas De Servicio atenea – grusamar ute Medio ambiente-comunidad valenciana ute Kv-grusamar Zaragoza grusamar- ineco- inastecan ute arucas Betancourt-grusamar ute osuna Betancourt –grusamar ute rio alhama gusamar – ineco ute inversiones 2008 ute grusamar – oHS ingeniería y urbanismo ute travesía De Hermigua grusamar – inastecán ute expropiación Betancourt – grusamar ute linares Sener- grusamar ute grusamar – Betancourt ute abastecimiento Huelva grusamar – prover ute Zeneta San Javier
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Name of the Jointly controlled Operations
Proportion of group’s Interest (%) 2011-12 $ 2010 - 11* 50% 50% 10% 30% 80% 80% 50% 50% 80% 50% 80% 20% 60% 70% 50% 80% 23% 25% 24% 100% 100% 34% 100% 50% 20% 45% 50% 60% 50% 50% 60% 65% 50% 80% 50% 50% 50% 30% 50% 50% 10% 30% 80% 80% 50% 50% 80% 50% 80% 20% 60% 70% 50% 80% 23% 25% 24% 100% 100% 50% 100% 50% 45% 50% 60% 50% 50% 60% 65% 50% 80% 50% 50% 50% 30% 30% 50% 50% 50% 50% 50% 50% 30% 30% 60% 50% 70%
grusamar- elsamex – atenea ute Seguridad vial Murcia grusamar – inserco ute Santas Martas palanquinos intevia-grusamar-Dair ute Seguridad vial Bizkaia intevia-grusamar ute Seguridad vial norte atenea – grusamar ute andalucía atenea – grusamar ute asturias atenea – consulnima ute consultea atenea – iz ingenieros ute atda embalse De Flix atenea – laboratorio Del noroeste ute corredor, Bion-noia atenea – grusamar ute Medio ambiente-comunidad valenciana atenea – inastecan ute Supervision Baleares 2008 grusamar elsamex atenea ute Seguridad vial Murcia intevia-grusamar-Dair ute Seguridad vial Bizkaia intevia-grusamar ute Seguridad vial norte Dair –intevia ute ciesm- labiker compañía general De Sondeos-geoteyco-emcosa-ciesm-Sondeos Del Sur ute 6/2004 cgs-geoteyco-ciesm-enmacosa ute 2/2006 geoteyco-cgs-ciesm-enmacosa 2/2008 ute Boca chica Sucursal Dominicana ute conservacion grupo Sur ute corredores viales De colombia ute romana Sucursal Dominicana ute cordoba ute intevia-tairona-lycSa ute vizcaya ii ute elsamex-tyosa ute arona ute sector 03 ute viales el Jable ute ap-7 ondara ute almanzora ute autovia de Santiago ute tren Mallorca ute grusamar-eyser ute Dallas ute cican ciesm ute intevia tairona castinsa ute urbanizacion centro atenea – Basoinsa ute atda Bergara Zizurkil ute grusumar – inserco rambla retamar ute pycsa – atenea ute Mantenimient De cuenca ute elsamex-lujan alicante ute Sur Sevilla ute grusamar-intecsa-inarsa-atenea ute grusamar-intecsa-inarsa-atenea ute grusamar-ingelan ute conservacion asturias ute conservacion almeria
$ *
proportion of group’s interest as at December 31, 2011 proportion of group’s interest as at December 31, 2010
118
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
f. INvesTmeNTs IN AssoCIATes: (a) an associate is an entity over which the group is in a position to exercise significant influence, but not control or joint control, through participation in the financial and / or operating policy decisions of such enterprises. in accordance with aS 23 the investments are carried in the consolidated Balance Sheet at cost as adjusted by post acquisition changes in the group’s share in the reserves and Surplus of associates (b) the accounting policies of associates have been adjusted as necessary and to the extent practicable, so as to ensure consistent accounting with the policies stipulated by the company (c) Details of associates and ownership interest are as follows: Name of the company country of Incorporation Proportion of group’s Interest (%) 2011-12 1. held directly : andhra pradesh expressway limited (“apel”) thiruvananthapuram road Development company limited (“trDcl”) itnl toll Management Services limited (“itMSl”) (see footnote below) warora chandrapur Ballarpur toll road limited (“wcBtrl”) 2. held through subsidiaries : centro de investigaciones de curretros andalucía S.a. labetec ensayos técnicos canarios, S.a. cgi 8 S.a. elsamex road technology company limited Sociedad concesionaria autovía a-4 Madrid S.a vcS-enterprises limited yala construction company limited ramky elsamex ring road limited, Hyderabad emprsas pame sa De cv
$ *
2010-11 49.00 50.00 49.00 34.98 49.00 * 50.00 * 49.00 * 40.29 * 48.75 * 30.00 * 33.33 * 26.00 * 34.10 *
india india india india Spain Spain Spain china Spain india thailand india Mexico
49.00 50.00 49.00 35.00 49.00 $ 50.00 $ 49.00 $ 23.44 $ 48.75 $ 30.00 $ 33.33 $ 26.00 $ 34.00 $
note: itMSl is a subsidiary of ntBcl which is consolidated as a Jointly controlled entity
proportion of group’s interest as at December 31, 2011. proportion of group’s interest as at December 31, 2010
g. gooDWILL oN CoNsoLIDATIoN: (a) goodwill comprises the portion of the purchase price for an acquisition that exceeds the group’s share in the identifiable assets, with deductions for liabilities, calculated on the date of acquisition (b) goodwill arising from the acquisition of associates is included in the value of the holdings in the associate (c) goodwill is deemed to have an indefinite useful life and is reported at acquisition value with deduction for accumulated impairments. an impairment test of goodwill is conducted once every year or more often if there is an indication of a decrease in value. the impairment loss on goodwill is reported in the consolidated Statement of profit and loss (d) goodwill on acquisition of the foreign subsidiary is restated at the rate prevailing at the end of the year h. DebeNTUre IssUe exPeNDITUre incremental costs directly attributable to the issue of debentures are being charged to the consolidated Statement of profit and loss over the period of redemption of debentures
119
transportation
annual report 2011-12
Notes
I. i)
forming part of the Consolidated Financial statements for the year ended March 31, 2012
ACCoUNTINg for rIghTs UNDer servICe CoNCessIoN ArrANgemeNTs recognition and measurement the group builds infrastructure assets under public-to-private Service concession arrangements (Scas) which it operates and maintains for periods specified in the Scas under the Scas, where the group has received the right to charge users of the public service, such rights are recognised and classified as “intangible assets”. Such right is not an unconditional right to receive consideration because the amounts are contingent to the extent that the public uses the service and thus are recognised and classified as intangible assets. Such an intangible asset is recognised by the group at cost (which is the fair value of the consideration received or receivable for the construction services delivered) under the Scas, where the group has acquired contractual rights to receive specified determinable amounts, such rights are recognised and classified as “Financial assets”, even though payments are contingent on the group ensuring that the infrastructure meets the specified quality or efficiency requirements. Such financial assets are classified as “receivables against Service concession arrangements” consideration for various services (i.e. construction or upgrade services, operation and maintenance services, overlay services) under the Sca is allocated on the basis of costs actually incurred or the estimates of cost of services to be delivered ii) Contractual obligation to restore the infrastructure to a specified level of serviceability the group has contractual obligations to maintain the infrastructure to a specified level of serviceability or restore the infrastructure to a specified condition before it is handed over to the grantor of the Sca. Such obligations are measured at the best estimate of the expenditure that would be required to settle the obligation at the balance sheet date. in case of intangible assets, the timing and amount of such cost are estimated and recognised on an undiscounted basis by charging costs to revenue on the units of usage method i.e. on the number of vehicles expected to use the project facility, over the period at the end of which the overlay is estimated to be carried out based on technical evaluation by independent experts. in case of financial assets, such costs are recognised in the year in which such costs are actually incurred iii) revenue recognition revenue from construction services is recognised according to the stage of completion of the contract, which depends on the proportion of costs incurred for the work performed till date to the total estimated contract costs provided the outcome of the contract can be reliably estimated. when the outcome of the contract cannot be reliably estimated but the overall contract is estimated to be profitable, revenue is recognised to the extent of recoverable costs. any expected loss on a contract is recognised as an expense immediately. revenue is not recognised when the concerns about collection are significant revenue from financial asset is recognised in the consolidated Statement of profit and loss as interest, calculated using the effective interest method from the year in which construction activities are started revenue from operating and maintenance services and from overlay services is recognised in the period in which such services are rendered revenue from intangible assets is recognised in the period of collection which generally coincides with the usage of the public service or where from such rights have been auctioned, in the period to which auctioned amount relates iv) borrowing cost in respect of a financial asset, borrowing costs attributable to construction of the road are charged to consolidated Statement of profit and loss in the period in which such costs are incurred in respect of an intangible asset, borrowing costs attributable to construction of the roads are capitalised up to the date of completion of construction. all borrowing costs subsequent to construction are charged to the consolidated Statement of profit and loss in the period in which such costs are incurred
120
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
v) Amortisation of Intangible Asset the intangible rights which are recognised in the form of right to charge users of the infrastructure asset are amortised on the units of usage method i.e. on the number of vehicles expected to use the project facility over the concession period as estimated by the management a review of the estimated useful life/the concession period of the rights and number of vehicles expected to use the project facility over the balance period is undertaken by the Management based on technical evaluation by independent experts at periodic intervals to assess the additional charge for amortisation, if any J. fIxeD AsseTs AND DePreCIATIoN/AmorTIsATIoN: a) Tangible fixed assets and depreciation tangible fixed assets acquired by the group are reported at acquisition cost, with deductions for accumulated depreciation and impairment losses, if any the acquisition cost includes the purchase price (excluding refundable taxes) and expenses, such as delivery and handling costs, installation, legal services and consultancy services, directly attributable to bringing the asset to the site and in working condition for its intended use where the construction or development of any asset requiring a substantial period of time to set up for its intended use is funded by borrowings, the corresponding borrowing costs are capitalised up to the date when the asset is ready for its intended use Depreciation on tangible fixed assets is computed as under: (i) in respect of premises, depreciation is computed on the Straight line Method at the rates provided under Schedule Xiv of the companies act, 1956 (ii) the group has adopted the Straight line Method of depreciation so as to depreciate 100% of the cost of the following type of assets at rates higher than those prescribed under Schedule Xiv to the companies act, 1956, based on the Management’s estimate of useful life of such assets: Asset Type computers Specialised office equipment assets provided to employees Useful life 4 years 3 years 3 years
(iii) Depreciation on fixed assets, other than on assets specified in J (a) (i) and (ii) above, is provided for on the written Down value Method at the rates provided under Schedule Xiv of the companies act, 1956. Depreciation is computed pro-rata from the date of acquisition of and up to the date of disposal (iv) leasehold improvement costs are capitalised and amortised on a straight-line basis over the period of lease agreement unless the corresponding rates under Schedule Xiv are higher, in which case, such higher rates are used (v) all categories of assets costing less than ` 5,000 each, mobile phones and items of soft furnishing are fully depreciated in the year of purchase b) Intangible assets and amortisation intangible assets, other than those covered by Scas, comprise of software and amounts paid for acquisition of commercial rights under an “operation and Maintenance” agreement for a toll road project and are depreciated as follow: Asset Type licensed Software intellectual property rights Useful life over the licence period 5 - 7 years
121
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
intangible assets are reported at acquisition cost with deductions for accumulated amortisation and impairment losses, if any acquired intangible assets are reported separately from goodwill if they fulfill the criteria for qualifying as an asset, implying they can be separated or they are based on contractual or other legal rights and that their market value can be established in a reliable manner an impairment test of such intangible assets is conducted annually or more often if there is an indication of a decrease in value. the impairment loss, if any, is reported in the consolidated Statement of profit and loss intangible assets, other than those covered by Scas, are amortised on a “straight line” basis over their estimated useful lives. the estimated useful life of software is four years. the amount paid for acquisition of the rights under the “operations and Maintenance” agreement is amortised over the minimum balance period (as at the time of acquisition) of the concession agreement relating to the corresponding toll road project (refer Foot note no. ii of note 13 to the financial statements) K. ImPAIrmeNT of AsseTs: the carrying values of assets of the group’s cash-generating units are reviewed for impairment annually or more often if there is an indication of decline in value. if any indication of such impairment exists, the recoverable amounts of those assets are estimated and impairment loss is recognised, if the carrying amount of those assets exceeds their recoverable amount. the recoverable amount is the greater of the net selling price and their value in use. value in use is arrived at by discounting the estimated future cash flows to their present value based on appropriate discount factor L. goverNmeNT grANTs: (a) government grants are recognised only when it is reasonably certain that the related entity will comply with the attached conditions and the ultimate collection is not in doubt (b) grants received as compensation for expenses or losses are taken to the consolidated Statement of profit and loss is accounted in the period to which it relates. grants in the nature of promoter’s contribution are treated as capital reserve (c) grants related to specific fixed assets are treated as deferred income, which is recognised in the consolidated Statement of profit and loss in proportion to the depreciation charge over the useful life of the asset m. INvesTmeNTs: (a) investments are capitalised at actual cost including costs incidental to acquisition (b) investments are classified as long term or current at the time of making such investments (c) long term investments are individually valued at cost, less provision for diminution, which is other than temporary (d) current investments are valued at the lower of cost and market value N. INveNTorIes: (a) inventories are valued at the lower of cost and net realisable value. net realisable value is estimated at the expected selling price less estimated selling costs (b) costs for trading goods are determined using the annual weighted average principle and includes purchase price and non-refundable taxes (c) cost of raw material includes purchase price and non-refundable taxes (d) cost of manufactured goods include direct and indirect cost (e) inventories of electronic cards (prepaid cards) and on-board units are valued at the lower of cost and net realisable value. cost is determined on first-in-first-out basis 122
SaFe SoliD SuStainaBle that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
o. reCogNITIoN of reveNUe oTher ThAN from servICe CoNCessIoN ArrANgemeNTs: (a) revenue is recognised when it is realised or realisable and earned. revenue is considered as realised or realisable and earned when it has persuasive evidence of an arrangement, delivery has occurred, the sales price is fixed or determinable and collectability is reasonably assured (b) revenue in respect of arrangements made for rendering services is recognised over the contractual term of the arrangement. in respect of arrangements which provide for an upfront payment followed by additional payments as certain conditions are met (milestone payments), the amount of revenue recognised is based on the services delivered in the period as stated in the contract. in respect of arrangements where fees for services rendered are success based (contingent fees), revenue is recognised only when the factor(s) on which the contingent fees is based actually occur. in respect of the group’s trading activities, revenue is recognised on dispatch of goods, which coincides with the significant transfer of risks and rewards (c) revenue realised from grant of advertisement rights is recognised as follows: (i) Development fees are recognised as income during the year in which the advertisement rights are granted (ii) license fees are recognised as income on a “Straight-line” basis over the duration of the license. (d) revenue from development projects under fixed - price contracts, where there is no uncertainty as to measurement or collectability of consideration is recognised based on the milestones reached under the contracts. pending completion of any milestone, revenue recognition is restricted to the relevant cost which is carried forward as part of unbilled revenue (e) interest income is accrued evenly over the period of the instrument P foreIgN CUrreNCY TrANsACTIoNs: . (a) transactions in foreign currencies are translated to the reporting currency based on the exchange rate on the date of the transaction. exchange difference arising on settlement thereof during the year is recognised as income or expenses in the consolidated Statement of profit and loss (b) cash and bank balances, receivables, (other than those that are in substance the group’s net investment in a non integral foreign operation), and liabilities (monetary items) denominated in foreign currency outstanding as at the year-end are valued at closing date rates, and unrealised translation differences are included in the consolidated Statement of profit and loss (c) non monetary items (such as equity investments) denominated in foreign currencies are reported using exchange rate as at the date of the transaction. where such items are carried at fair value, these are reported using exchange rates that existed on dates when the fair values were determined (d) inter-company receivables or payables for which settlement is neither planned nor likely to occur in the foreseeable future and are in substance an extension to or a deduction from the group’s net investments in a foreign entity are translated at closing rates but the exchange differences arising are accumulated in a foreign currency translation reserve until disposal of the net investment, at which time they are recognised as income or expense in the consolidated Statement of profit and loss. any repayment of receivables or payables forming part of net investment in foreign operations is not considered as partial disposal of investments in foreign operations and amounts previously recognised in the foreign currency translation reserve are not adjusted until the disposal of the ownership interest occurs (e) the group’s forward exchange contracts are not held for trading or speculation. the premium or discount arising on entering into such contracts is amortised over the life of the contracts and exchange difference arising on such contracts is recognised in the consolidated Statement of profit and loss
123
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Q. emPLoYee beNefITs: a) short Term Short term employee benefits are recognised as an expense at the undiscounted amount expected to be paid over the period of services rendered by the employees to the group b) Long Term the group has both defined-contribution and defined-benefit plans, of which some have assets in special funds or securities. the plans are financed by the group and in the case of some defined contribution plans by the group along with its employees (i) Defined-contribution plans these are plans in which the group pays pre-defined amounts to separate funds and does not have any legal or informal obligation to pay additional sums. these comprise of contributions to the employees’ provident fund, family pension fund and superannuation fund. the group’s payments to the defined contribution plans are reported as expenses in the period in which the employees perform the services that the payment covers (ii) Defined-benefit plans expenses for defined-benefit gratuity plans are calculated as at the balance sheet date by independent actuaries in a manner that distributes expenses over the employee’s working life. these commitments are valued at the present value of the expected future payments, with consideration for calculated future salary increases, using a discount rate corresponding to the interest rate estimated by the actuary having regard to the interest rate on government bonds with a remaining term that is almost equivalent to the average balance working period of employees the actuarial gains and losses are recognised immediately in the consolidated Statement of profit and loss c) other employee benefits compensated absences which accrue to employees and which can be carried to future periods but are expected to be encashed or availed in twelve months immediately following the year end are reported as expenses during the year in which the employees perform the services that the benefit covers and the liabilities are reported at the undiscounted amount of the benefits after deducting amounts already paid. where there are restrictions on availment or encashment of such accrued benefit or where the availment or encashment is otherwise not expected to wholly occur in the next twelve months, the liability on account of the benefit is actuarially determined using the projected unit credit method r. TAxes oN INCome: (a) taxes include taxes on income, adjustment attributable to earlier periods and changes in deferred taxes. taxes are determined in accordance with enacted tax regulations and tax rates in force and in the case of deferred taxes at rates that have been substantively enacted (b) Deferred tax is calculated to correspond to the tax effect arising when final tax is determined. Deferred tax corresponds to the net effect of tax on all timing differences, which occur as a result of items being allowed for income tax purposes during a period different from when they are recognised in the financial statements (c) Deferred tax assets are recognised with regard to all deductible timing differences to the extent that it is probable that taxable profit will be available against which deductible timing differences can be utilised. when the group’s entities carry forward unused tax losses and unabsorbed depreciation, deferred tax assets are recognised only to the extent there is virtual certainty backed by convincing evidence that sufficient future taxable income will be available against which deferred tax assets can be realised (d) the carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced by the extent that it is no longer probable that sufficient future taxable profit will be available to allow all or a part of the aggregate deferred tax asset to be utilised
124
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
(e) Minimum alternate tax (Mat) paid in accordance with the tax laws, which gives rise to future economic benefits in the form of adjustment of future income tax liability, is considered as an asset if there is convincing evidence that the company will pay normal tax in the future period. accordingly, it is recognised as an asset in the Balance Sheet when it is probable that the future economic benefit associates with it will flow to the company s. ProvIsIoNs, CoNTINgeNT LIAbILITIes AND CoNTINgeNT AsseTs: (a) a provision is recognised when the group has a present obligation as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made (b) provisions (excluding retirement benefits) are not discounted to their present value and are determined based on best estimates required to settle the obligation at the Balance Sheet date (c) these are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. (d) contingent liabilities are not recognised but are disclosed in the notes to the financial statement (e) a contingent asset is neither recognised nor disclosed T. segmeNT rePorTINg: (a) Segment revenues, expenses, assets and liabilities have been identified to segments on the basis of their relationship to the operating activities of the Segment. (b) revenue, expenses, assets and liabilities, which relate to the group as a whole and are not allocable to segments on a reasonable basis, are included under “unallocated revenue/expenses/assets/liabilities” U. fINANCIAL INCome AND borroWINg CosTs: Borrowing costs are recognised in the period to which they relate, regardless of how the funds have been utilised, except where it relates to the financing of construction of development of assets requiring a substantial period of time to prepare for their intended future use. interest is capitalised up to the date when the asset is ready for its intended use. the amount of interest capitalised (gross of tax) for the period is determined by applying the interest rate applicable to appropriate borrowings outstanding during the period to the average amount of accumulated expenditure for the assets during the period v. eArNINgs Per shAre: (a) Basic earnings per share is calculated by dividing the net profit after tax for the year attributable to equity shareholders of the group by the weighted average number of equity shares in issue during the year. (b) Diluted earnings per share is calculated by dividing the net profit after tax for the year attributable to equity shareholders of the group by the weighted average number of equity shares determined by assuming conversion on exercise of conversion rights for all potential dilutive securities W. DerIvATIve TrANsACTIoNs: (a) premium paid on acquisition of option contracts is treated as a current asset until maturity. if the premium paid exceeds the premium prevailing as at the date of the balance sheet, the difference is charged to the consolidated Statement of profit and loss if the prevailing premium as at the balance sheet date exceeds the premium paid for acquiring option contracts, the difference is not recognised (b) premium received on option contracts written is treated as a current liability until maturity. if the premium prevailing on the balance sheet date exceeds the premium received on such options, the difference is charged to the consolidated Statement of profit and loss. if the prevailing premium as at the balance sheet date falls short of the premium received for writing option contracts, the difference is not recognised (c) Hedging instruments are initially measured at fair value, and are remeasured at subsequent reporting dates. changes in the fair value of these derivatives that are designated and effective as hedges of future cash flows are recognised directly in shareholder’s funds and the ineffective portion is recognised immediately in consolidated Statement of profit and loss 125
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
changes in the fair value of derivative financial instruments that do not qualify for hedge accounting are recognised in consolidated Statement of profit and loss premium paid on option contracts acquired is treated as an asset until maturity. premium received on option contracts written is treated as liability until maturity. in case of Forward exchange contracts which are not intended for trading or speculation purposes, the premium or discount arising at the inception of such a forward exchange contract is amortised as expense or income over the life of the contract. exchange differences on such a contract are recognised in the consolidated Statement of profit and loss in the reporting period in which the exchange rates change. any profit or loss arising on cancellation or renewal of such a forward exchange contract is recognised as income or as expense for the period x. LeAses: (a) Finance leases, which effectively transfer to the group substantial risks and benefits incidental to ownership of the leased item, are capitalised and disclosed as leased assets. lease payments are apportioned between finance charges and reduction of lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged directly against income. (b) leases where the lessor retains substantially all the risks and benefits of ownership of the asset are classified as operating leases. operating lease payments are recognised as an expense in the consolidated Statement of profit and loss on a straight line basis over the lease term. any compensation, according to agreement, that the lessee is obliged to pay to the lessor if the leasing contract is terminated prematurely is expensed during the period in which the contract is terminated Y. CAsh AND CAsh eQUIvALeNTs: cash comprises of cash on Hand, cheques on Hand and demand deposits with Banks. cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risks of changes in value Z. CoNsoLIDATeD CAsh fLoW sTATemeNT: the consolidated cash Flow Statement is prepared in accordance with the “indirect Method” as explained in the accounting Standard (aS) 3 on “cash Flow Statements”
NOTE 2 : SHARE cAPITAl
As at March 31, 2012 Number of Shares 250,000,000 194,267,732 194,267,732 194,267,732 ` in million As at March 31, 2011 Number of Shares 250,000,000 194,267,732 194,267,732 194,267,732 ` in million
Particulars Authorised equity Shares of ` 10/- each Issued equity Shares of ` 10/- each subscribed and Paid up equity Shares of ` 10/- each fully paid (refer foot note no. i, ii, and iii) ToTAL fooT NoTes: i)
2,500.00 1,942.68 1,942.68 1,942.68
2,500.00 1,942.68 1,942.68 1,942.68
reconciliation of the number of shares outstanding at the beginning and at the end of the reporting year
126
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Shares outstanding at the beginning of the year Shares issued during the year Shares bought back during the year Shares outstanding at the end of the year
As at March 31, 2012 Number of ` in million Shares 194,267,732 1,942.68 194,267,732 1,942.68
As at March 31, 2011 Number of ` in million Shares 194,267,732 1,942.68 194,267,732 1,942.68
ii) of the above 135,000,000 (as at March 31, 2011 : 135,000,000) shares are held by the holding company viz. infrastructure leasing & Financial Services limited (“il&FS”) and 2,440,534 (as at March 31, 2011 : nil) shares are held by a fellow subsidiary viz. il&FS Financial Services limited iii) Shareholder’s Shareholding more than 5% shares Shareholder il&FS il&FS employee welfare trust ToTAL
*
As at March 31, 2012 Number of % of total Shares held holding 135,000,000 69.49% not applicable* not applicable* 135,000,000 69.49%
As at March 31, 2011 Number of Shares held 135,000,000 10,867,769 145,867,769 % of total holding 69.49% 5.59% 75.08%
the number of shares held by il&FS employee welfare trust as at March 31, 2012 do not represent 5% or more of the total holding and hence, the disclosure of number of shares and percentage of holding as at March 31, 2012 have not been given
NOTE 3 : RESERvES AND SURPlUS
Particulars (a) securities Premium Account opening balance (+/-) addition / (Deletion) during year (b) general reserve opening balance (+) current year transfer (-) written back in current year (c) Debenture redemption reserve opening balance (+) created during the year (-) written back in current year (d) Capital reserve opening balance (+) created during the year (-) written back in current year (e) other reserves (refer foot note no.i) Foreign currency translation reserve cash flow hedge reserve (f) Capital reserve on Consolidation (net) (refer foot note no. ii) opening balance (+) on account of acquisition (net) (-) written back in current year (g) surplus in Consolidated statement of Profit and Loss opening balance (+) profit for the current year (-) consolidation adjustment (-) transfer to general reserve (-) transfer to debenture redemption reserve (-) Dividends (including dividend tax) (-) premium on preference shares of subsidiary (-) Dividend tax on premium on preference shares of subsidiary ToTAL As at March 31, 2012 10,320.57 715.51 252.29 21.96 237.95 1,881.55 1,085.91 102.35 (523.42) 1,215.19 55.36 6,806.49 4,969.58 (2.62) (252.29) (237.95) (934.39) (16.19) (2.63) 10,320.57
` in million As at March 31, 2011 10,320.57 427.47 288.04 20.47 1.49 29.13 1,852.42 (221.15) (290.59) 1,076.06 139.13 3,580.21 4,328.79 (288.04) (1.49) (794.16) (16.14) (2.68) 10,320.57
967.80
715.51
259.91
21.96
2,967.46 (421.07)
1,881.55 (511.74)
1,270.55
1,215.19
10,330.00 25,695.22
6,806.49 20,449.53
127
transportation
annual report 2011-12
Notes
fooT NoTes: i)
forming part of the Consolidated Financial statements for the year ended March 31, 2012
(a) Foreign currency translation reserve ` in million As at March 31, 2012 (221.15) 323.50 102.35 As at March 31, 2011 (438.70) 217.55 (221.15)
Particulars Balance at the beginning of the year Movement for the year (net) Balance at the end of the year (b) cash flow hedge reserve
the movement in hedging reserve held by a subsidiary during the year ended March 31, 2012 for derivatives designated as cash flow hedges is as follow: ` in million Particulars Balance at the beginning of the year Movement for the year (net) Balance at the end of the year As at March 31, 2012 (290.59) (232.83) (523.42) As at March 31, 2011 (271.53) (19.06) (290.59)
ii) During the current year, the company has purchased additional shares of wgel by exercising the option available with it. this purchase has resulted in capital reserve on consolidation of ` 66.42 million. the company has adjusted the goodwill on consolidation of ` 11.06 million arising on earlier purchase of wgel Shares. thus, net amount of ` 55.36 million has been credited to capital reserve on consolidation
NOTE 4 : PREfERENcE SHARES ISSUED BY SUBSIDIARY TO MINORITY SHAREHOlDERS (INclUDED UNDER MINORITY INTEREST) :
one Subsidiary company viz. gricl, had originally issued cumulative redeemable convertible preference Shares (crcpS) carrying 1% dividend, which were to be redeemed at the end of the 13th year from the date of allotment at a premium of 60% on the par value. these shares also carried an option to convert the cumulative amount (including the redemption premium of 60%) into Deep Discount Bonds (DDBs) at the end of the 13th year at a value calculated based on the issue price of ` 17.38 each at the time of conversion and having a maturity value of ` 153.98 each redeemable over a period of 3 years commencing from the 5th year from the date of conversion into the DDBs. However, consequent to the restructuring of the company’s corporate debt, the subscribers to the crcpS agreed to a revision in the terms thereof to the effect that the dividend becomes non-cumulative and the crcpS will become non-cumulative redeemable convertible preference Shares (nrcpS) with effect from april 1, 2004. as a result, the base price and the redemption price of each DDB stood modified; these prices will be determined at the end of the 13th year as a part of the restructuring package approved by the corporate Debt restructuring cell, the subsidiary is not permitted to declare any dividend on equity or preference shares without making good the sacrifices of the lenders the accumulated premium accrued on non-cumulative redeemable convertible preference Shares and not provided for as at March 31, 2012 ` 152.98 (previous year ` 136.80 million) and the tax on distribution thereof aggregates ` 24.82 (previous year 22.72 million) these preference shares issued amounting to ` 350.00 million (as at March 31, 2011 : ` 350.00 million) have been included as a part of Minority interest
128
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 5 : ADvANcE TOwARDS cAPITAl TO SUBSIDIARY BY MINORITY SHAREHOlDERS (INclUDED UNDER MINORITY INTEREST) :
Particulars gujarat road and infrastructure company limited # vansh nimay infraprojects limited Mp Border checkpost Development company limited ToTAL
#
` in million
As at March 31, 2012 450.00 450.00
As at March 31, 2011 450.00 1.00 60.00 511.00
as required under the restructuring package of a subsidiary viz. gricl approved by the corporate Debt restructuring cell on June 17, 2004, the promoters of gricl had advanced an aggregate sum of ` 450.00 million as advance towards share capital. the subsidiary intends to convert these advances into subordinated debt. pending completion of the approval process, the group has classified the amount as an advance towards capital
the aggregate amount of ` 450.00 million (as at March 31, 2011 : ` 511.00 million) as detailed above has been included as a part of Minority interest
NOTE 6 : lONg-TERM BORROwINgS
Particulars (a) bonds / Debentures (refer foot note no. i) (i) Secured non convertible debentures Deep discount bonds (ii) unsecured non convertible debentures (b) Term Loans (i) Secured From banks (refer foot note no. ii) From financial institutions From others (ii) unsecured From banks From others (c) finance lease obligations (i) Secured ToTAL As at March 31, 2012
` in million As at March 31, 2011
3,116.00 360.22 252.00
3,476.22 252.00
3,751.00 356.90 288.00
4,107.90 288.00
52,206.03 997.56 254.71 5,646.10 6,905.00 -
53,458.30
25,948.63 716.09 420.66 4,323.42 56.45 128.96
27,085.38
12,551.10 69,737.62
4,379.87 128.96 35,990.11 ` in million
NOTE 7 : SHORT-TERM BORROwINgS
Particulars (a) Loans repayable on demand (i) Secured From banks From financial institutions From others (ii) unsecured From banks From financial institutions (b) Term Loans Secured from banks unsecured from banks unsecured from related parties unsecured from others ToTAL As at March 31, 2012
As at March 31, 2011
685.15 8.03 210.73 7,161.91 12,650.00 1,215.00
693.18 210.73
1,065.77 28.60 809.61 12.11 7,300.00 1,018.98 -
1,094.37 821.72
21,026.91 21,930.82
8,318.98 10,235.07 129
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 8 : DEfERRED TAX lIABIlITIES (NET) AND DEfERRED TAX ASSETS
the group entities have net deferred tax liabilities aggregating ` 2,046.51 (previous year ` 1,438.65 million) and deferred tax assets aggregating ` 5.23 (previous year ` 116.75 million) as at March 31, 2012 a) The components of deferred tax liabilities (net) are furnished below: ` in million Particulars Liabilities: timing differences in respect of income timing differences in respect of depreciation Assets: timing differences in respect of depreciation timing differences in respect of employee benefits timing differences in respect of unabsorbed depreciation and business losses timing differences in respect of provision for doubtful debts timing differences in respect of provision for overlay Deferred tax liabilities (net) b) The components of deferred tax assets is furnished below: ` in million Particulars Assets: timing differences in respect of income timing differences in respect of depreciation timing differences in respect of employee benefits Deferred tax assets As at As at March 31, 2012 March 31, 2011 0.01 2.50 2.72 5.23 114.86 0.23 1.66 116.75 ` in million As at March 31, 2012 796.00 1,213.33 281.68 796.00 As at March 31, 2011 185.10 721.10 207.41 185.10 As at As at March 31, 2012 March 31, 2011 2,023.45 32.32 (0.06) (8.22) (0.98) 2,046.51 765.45 1,072.22 (9.72) (302.60) (2.55) (84.15) 1,438.65
NOTE 9 : OTHER lONg TERM lIABIlITIES
Particulars (a) Trade Payables From others (b) others redemption premium accrued but not due on borrowings other liabilities ToTAL
1,495.01 2,291.01
928.51 1,113.61 ` in million
NOTE 10 : OTHER cURRENT lIABIlITIES
Particulars (a) (b) (c) (d) (e) (f) interest accrued but not due on borrowings interest accrued and due on borrowings income received in advance advance received unearned revenue other liabilities (statutory and other dues) As at March 31, 2012 42.74 29.14 470.07 9.77 1,308.32 1,860.04 1,860.04
As at March 31, 2011 40.24 34.06 77.28 419.30 38.13 849.72 1,458.73 1,458.73
ToTAL
130
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars (a) (b) (c) (d)
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 11 : lONg-TERM PROvISIONS
As at March 31, 2012 5.15 0.88 152.99 25.35 21.28 537.77 7.49 ` in million As at March 31, 2011 5.15 0.88 136.80 22.72 11.15 507.59 7.49
provision for dividend on preference shares of subsidiary provision for dividend tax on preference dividend of subsidiary provision for premium on preference shares of subsidiary provision for dividend tax on premium on preference shares of subsidiary (e) provision for employee benefits (f) provision for overlay (refer foot note (i) of note no. 12) (g) provision for contingency (refer foot note no. i) ToTAL
750.91 750.91
691.78 691.78
fooT NoTe (i) the provision for contingency includes ` 7.49 million provided in accordance with the terms of scheme of amalgamation of jointly controlled entity for prepayment of loans ` in million Particulars opening balance add : provision made during the year less : provision utilised / reversed during the year Closing balance As at March 31, 2012 7.49 7.49 As at March 31, 2011 7.49 7.49 ` in million As at March 31, 2012 252.26 68.74 800.67 129.89 143.63 1,395.19 1,395.19 As at March 31, 2011 261.73 29.80 679.94 110.30 11.15
NOTE 12 : SHORT-TERM PROvISIONS
Particulars (a) “provision for employee benefits (net) (refer foot note no. (i) (B) of note 28)” (b) provision for tax (net of advance) (c) proposed dividend on equity shares (d) provision for tax on proposed dividend on equity shares (e) provision for overlay (refer foot note no. i) ToTAL
1,122.69 1,122.69
fooT NoTe (i) provision for overlay in respect of toll roads maintained by the group under service concession arrangements and classified as intangible assets represents contractual obligations to restore an infrastructure facility to a specified level of serviceability in respect of such asset. estimate of the provision is measured using a number of factors, such as contractual requirements, technology, expert opinions and expected price levels. Because actual cash flows can differ from estimates due to changes in laws, regulations, public expectations, technology, prices and conditions, and can take place many years in the future, the carrying amounts of provision is reviewed at regular intervals and adjusted to take account of such changes accordingly, financial and accounting measurements such as the revenue recognized on financial assets, allocation of annuity into recovery of financial asset, carrying values of financial assets and depreciation of intangible assets and provisions for overlay in respect of service concession agreements are based on such assumptions Movements in provision made for overlay are tabulated below: ` in million Particulars opening balance adjustment for new acquisition / exchange difference during the year utilised for the year provision made during the year closing balance As at As at As at March 31, 2012 March 31, 2012 March 31, 2011 long-term current long-term 507.59 40.92 432.77 17.45 2.18 (15.04) 12.73 117.75 113.56 537.77 143.63 548.51 131
132 ` in million gross Block
Deletions / Additions Adjustments Balance as at March 31, 2012 AdjustBalance ments / Reas at classificaApril 1, tions (Refer 2011 footnote iv)
Depreciation charge for the year (refer foot note i)
NOTE 13 : fIXED ASSETS
Notes
SaFe
SoliD
Accumulated Depreciation and Amortisation
Deletions / Adjustments Balance as at March 31, 2012 Balance as at March 31, 2011 Balance as at March 31, 2012
Net Block
transportation
Balance as at April 1, 2011
Adjustments / Reclassifications (Refer footnote iv)
SuStainaBle
forming part of the Consolidated Financial statements for the year ended March 31, 2012
that’s itnl for you
a Tangible Assets land Building and structures vehicles Data processing equipments office premises office equipments leasehold improvements Furniture and fixtures electrical installations plant and machinery advertisement structure plant and machinery - leased vehicles - leased Furniture and fixtures - leased Building and structures - leased land - leased 51.32 16.02 11.04 3.38 0.02 110.12 10.22 15.00 217.12 5.32 891.45 68.12 28,581.61 681.63 1.22 201.50 206.54 124.33 26.70 11.66 (0.02) 173.29 57.91 4,473.31 2,718.24 226.50 324.32 15.23 26.96 392.42 47.38 3,221.68 0.25 151.22 53.39 - 1,247.34 1,251.63 50.28 153.15 18.57 1.25 0.01 1.57 0.15 0.15 32.71 3.50 24.07 173.94 1,076.99 139.72 11.52 81.64 12.45 277.78 98.59 1,924.31 24.80 302.82 125.83 169.96 28.89 2.79 782.02 78.84 1.92 30.89 3.65 116.64 14.39 997.11 9.23 611.67 54.67 4.71 9.71 20.22 (28.10) 13.15 6.43 24.20 80.57 584.48 7.12 (474.94) (5.91) (4.71) 3.99 3.46 109.45 13.15 0.19 10.13 4.52 16.82 3.25 96.54 2.73 42.09 18.79 3.20 26.47 14.88 848.49 1.24 103.90 0.01 2.10 1.20 46.25 8.17 0.36 157.30 1.56 96.65 25.11 1,653.02 19.08 - 178.82 3.02 64.53 16.90 24.07 147.47 228.50 35.82 9.42 35.39 4.28 120.48 1.94 271.29 5.72 124.00 61.30 153.06 28.89 491.72 15.18 -
26.03 53.36 1,027.97 106.66 11.53 60.17 12.45 133.04 15.31 1,056.43 11.67 1,028.94 83.56 10.38 158.15 26.73
(1.96) 120.58 16.27 18.29 12.00 141.51 83.41 790.47 13.13 (736.34) 30.77 (10.38) 11.81 2.16
26.03 50.57 245.95 27.82 9.61 29.28 8.80 16.40 0.92 59.32 2.44 417.27 28.89 5.67 148.44 26.73 1,104.14 56.67 181.06 27,334.27 12,598.74
3,822.38
181.00 207.76
ToTAL b Intangible Assets Software / licences commercial rights acquired (refer foot note no. ii) rights under service concession arrangements (refer foot note no. iii) trademarks and licences others 0.14 10.03 896.79 69.37 29,173.98 0.02 0.01 0.02 1.92 182.41 1.78 93.76 928.20 0.13 5.34 190.40 416.90 83.97
13,280.37 14,477.91
1.79 172.38
8.18 442.79 767.11 614.58
-
1.91 107.28
0.01 75.13
0.01 78.62 0.25 1,561.14 27,612.84 12,915.10 195.20 10.32 - 34,812.66 15,755.81 47.63 4,782.82 63,872.33 29,785.37 6.69 3,646.44 29,785.37
ToTAL
13,843.30 14,503.26
annual report 2011-12
c Capital work-in-progress d Intangible Assets grAND ToTAL PrevIoUs YeAr
10.32 184.88 15,755.81 - 19,056.85 33,431.81 14,994.98 20,355.64 19,134.36 153.36 14,176.37
195.20 - 34,812.66 127.28 68,655.15 3,646.44 32.28 33,431.81 2,954.58
02 | corporate overview
fooT NoTes: 1) Depreciation on assets used during the construction period 1.59 (previous year ` 0.39 million) has been included in “capital work in progress”. therefore, the charge to the statement of profit and loss is lower by this amount
Notes
2) During the year 2006-07, the group incurred a cost of rupees 60.00 million for acquiring commercial rights under the “operations and Maintenance” agreement (“o&M contract”) for one of its road projects from the erstwhile contractor. under the terms of the o&M contract, the group is entitled to routine maintenance price and the operation price for maintaining and operating the project. the group expects benefits under the o&M contract to accrue until the end of the concession period which is not expected to be earlier than May 12, 2029. accordingly, the expenditure incurred by the group for acquisition of the rights is treated as an intangible asset and is being amortised on a straight line basis over the minimum balance period of the concession i.e. 22 years and 7 months (from the date of acquisition of the said rights)
3) estimates under service Concession Arrangement - right under service Concession Arrangements / Intangible assets under Developments
20 | Strategic review
under the Service concession arrangements, where the group has received the right to charge users of the public services, such rights are recognized and classified as “intangible assets”. Such a right is not an unconditional right to receive consideration because the amounts are contingent to the extent that the public uses the service and thus are recognized and classified as intangible assets. Such an intangible asset is recognised by the group at cost (which is the fair value of consideration received or receivable for the construction services delivered) accordingly, the fair value of consideration for construction services in respect of intangible assets covered under service concession arrangements of the group, the useful lives of such intangible assets, the annual amortisation in respect thereof, and the provisions for overlay costs have been estimated by the Management having regard to the contractual provisions, the evaluations of the units of usage and other technical evaluations by independent experts, the key elements having been tabulated below: ` in million
Particulars
Margin on construction services recognised in respect of intangible assets (` in million) carrying amounts of intangible assets (` in million) amortisation charge in respect of intangible assets (` in million)
As at March 31, 2012 5,009.67 27,334.27 392.42 50,867,738 to 1,554,733,739 681.40 34,812.66
As at March 31, 2011 2,170.59 12,598.74 212.12 56,042,180 to 1,770,530,926 548.51 15,755.81
units of usage (no. of vehicles)
32 | Statutory reportS
provision for overlay in respect of intangible assets (` in million) carrying amounts of intangible assets under developments (` in million)
forming part of the Consolidated Financial statements for the year ended March 31, 2012
4) adjustments includes additions to gross Block and accumulated Depreciation towards acquisition of new subsidiaries / jointly controlled entities during the year and deductions to gross Block and accumulated Depreciation towards sale / cesssation of subsidiaries / jointly controlled entities and regrouping of previous year figures
59 | FinancialS consolidated
133
transportation
annual report 2011-12
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 14 : NON-cURRENT INvESTMENTS
` in million As at March 31, 2012 1,268.36 (11.94) 175.24 9.84 (392.75) 1,048.75 182.85 1,693.00 1,111.51 (204.20) 3,831.91 As at March 31, 2011 699.13 17.51 39.25 9.10 (225.37) 539.62 182.36 648.00 791.13 (241.23) 1,919.88
a) Investments in Unquoted equity Instruments - Associates investments in associates add /(less): unrealised gain on transactions between the company and its associates add: post-acquisition share of profit / (loss) of associates (net) add: post-acquisition share of movement in the other reserves of an associate (net) less: cash flow hedge reserve b) Investments in Unquoted equity Instruments (refer note 32) c) Investments in Covered Warrants (refer foot note no. i) d) Investments in other Instruments less: provision for dimunition in the value of investments ToTAL fooT NoTe
(i) the company’s investment in “covered warrants” aggregating to ` 1,693.00 million (as at March 31, 2011 ` 648.00 million) issued by infrastructure leasing & Financial Services limited (“il&FS”) the holding company, are variable interest debt instruments under which the holder is entitled to a proportionate share of the dividend, if any, declared by road infrastructure Development company of rajasthan limited (“riDcor”), Jharkhand accelerated road Development company limited (“JarDcl”), chhatisgarh Highways Development company limited (“cHDcl”) and Jharkhand road projects implementation company limited (“Jrpicl”) on the equity shares held by il&FS as well as the interest granted by riDcor on the Fully convertible Debentures (“FcDs”) held by il&FS. However, the company is not entitled to rights and privileges, which il&FS enjoys as a shareholder / debentureholder. the instruments are unsecured
NOTE 15 : cURRENT INvESTMENTS
` in million Particulars investments in units of Mutual Funds ToTAL As at March 31, 2012 122.22 122.22 As at March 31, 2011 89.29 89.29
134
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 16 : lONg-TERM lOANS AND ADvANcES
As at March 31, 2012 142.28 1.83 81.09 142.28
` in million As at March 31, 2011 785.25 42.20 120.89 785.25
(a) Capital Advances unsecured, considered good (b) security Deposits Secured, considered good unsecured, considered good (c) Loans and advances to related parties unsecured, considered good - option premium (net of provision) - long term loans (d) other loans and advances unsecured, considered good - advance recoverable in cash or kind - others - loans to others ToTAL
82.92
163.09
36.67 1,237.29
1,273.96
136.43 1,287.11
1,423.54
4,764.56 1,680.60
6,445.16 7,944.32
3,403.31 152.50
3,555.81 5,927.69 ` in million
NOTE 17 : SHORT-TERM lOANS AND ADvANcES
Particulars (a) Loans and advances to related parties unsecured, considered good - advance recoverable in cash or kind - related parties - inter-corporate deposits - advance towards share application money - Short term loans (b) other loans and advances unsecured, considered good - advance recoverable in cash or kind - Mat credit entitlement - advance payment of taxes (net of provision) - advance towards share application money - Short term loans - others - current maturities of long term loans and advances ToTAL As at March 31, 2012
As at March 31, 2011
15.91 673.30 1,073.00
1,762.21
11.28 270.00 616.91 660.99
1,559.18
3,808.43 213.07 1,096.62 269.80 2,005.81 42.50
7,436.23 9,198.44
6,161.56 71.02 989.35 469.83 1,675.95 -
9,367.71 10,926.89
NOTE 18 : OTHER NON-cURRENT ASSETS
Particulars (a) long term trade receivables (unsecured, considered good) (b) receivables against Service concession arrangement (refer foot note (i) of note no. 19)" (c) toll receivable account (refer foot note no. (i) (d) interest accrued but not due ToTAL As at March 31, 2012 278.29 45,980.02 1,898.70 533.67 48,690.68 48,690.68
` in million As at March 31, 2011 0.06 23,715.91 1,898.70 319.13 25,933.80 25,933.80
135
transportation
annual report 2011-12
Notes
fooT NoTe
forming part of the Consolidated Financial statements for the year ended March 31, 2012
(i) toll receivable account includes ` 1,565.47 million being the aggregate shortfall in the assured return up to September 30, 2003, as adjusted for margin recognised during construction, as per the terms of the concession agreements in respect of the two road projects in a subsidiary. the amount was recognised with a corresponding credit to the general reserve of the subsidiary pursuant to the order dated May 18, 2005 passed by the Honourable High court of gujarat at ahmedabad, sanctioning the Scheme of amalgamation of the two toll road companies with the subsidiary Similarly, pursuant to the orders passed by the Honourable High courts of allahabad and Delhi dated March 22, 2007 and May 21, 2007, approving a scheme of amalgamation, a jointly controlled entity, had also recognised an amount in the toll receivable account. after making appropriate adjustments on account of the construction margin, a sum of ` 333.23 million has been included as the group’s share in the toll receivable account
NOTE 19 : OTHER cURRENT ASSETS
Particulars (a) unbilled revenue (b) interest accrued (c) receivables against Service concession arrangement (refer foot note no. i) (d) grant receivable ToTAL fooT NoTe (i) estimates under service Concession Arrangement - financial assets As at March 31, 2012 243.44 809.78 627.69 1,680.91 1,680.91
` in million As at March 31, 2011 515.40 164.33 1,553.45 1,470.87 3,704.05 3,704.05
under the Service concession arrangements, where the group has acquired contractual rights to receive specified determinable amounts, such rights are recognised and classified as Financial assets, even though payments are contingent on the group ensuring that the infrastructure meets the specified quality or efficiency requirements. Such financial assets are classified as “receivables against Service concession arrangements accordingly, the fair value of consideration for construction services and the effective interest rate in the case of financial assets of the group covered under service concession arrangements included as a part of “receivables against Service concession arrangements” have been estimated by the Management having regard to the contractual provisions, the evaluations of the future operating and maintenance costs and the overlay / renewal costs and the timing thereof by independent experts, the key elements having been tabulated below: ` in million Particulars Margin on construction and operation & maintenance and renewal services recognised in respect of receivables against Service concession arrangements carrying amounts of Financial assets included under receivables against Service concession arrangements revenue recognised on receivables against Service concession arrangements on the basis of effective interest method As at March 31, 2012 4,104.42 As at March 31, 2011 2,490.34
46,789.80 9,362.88
25,269.36 6,254.28
136
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 20 : INvENTORIES
` in million As at March 31, 2012 As at March 31, 2011
inventories (at cost) (i) raw materials (ii) Finished goods (iii) Stores and spares ToTAL
47.82 158.21 4.07 210.10
10.72 248.58 2.87 262.17
NOTE 21 : TRADE REcEIvABlES
Particulars (a) Trade receivables outstanding for a period less than six months from the date they are due for payment unsecured, considered good (b) Trade receivables outstanding for a period exceeding six months from the date they are due for payment unsecured, considered good other considered doubtful less: provision for doubtful debt ToTAL 5,927.48 5,927.48 6,843.56 As at March 31, 2012
` in million As at March 31, 2011
6,843.56
2,892.65 3.00 (3.00)
2,892.65 8,820.13
645.45 3.58 (3.58)
645.45 7,489.01
NOTE 22 : cASH AND cASH EQUIvAlENTS
Particulars (a) Cash and cash equivalents cash on hand current accounts Fixed Deposits placed for a period less than 3 months (b) other bank balances unpaid dividend accounts Fixed Deposits placed for a period exceeding 3 months ToTAL As at March 31, 2012
` in million As at March 31, 2011
14.81 1,468.09 183.08 0.35 1,171.54
1,665.98
16.10 1,920.54 2,423.06 0.11 915.65
4,359.70
1,171.89 2,837.87
915.76 5,275.46
137
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 23 : cONTINgENT lIABIlITIES AND cAPITAl cOMMITMENTS (A) cONTINgENT lIABIlITIES
Particulars (i) (ii) claims against the group not acknowledged as debt other money for which the company is contingently liable - income tax demands contensted by the group - royalty to nagpur Municipal corporation (iii) in terms of the approved restructuring package, the lenders of a subsidiary have a right of recompense, in respect of the sacrifices undertaken by them on account of reduction in interest rates and wavier of compound interest and liquidated damages, in the event of projects’ cash flows(after adjusting the operating costs) are in excess of the revised debt servicing requirements ` in million As at As at March 31, 2012 March 31, 2011 812.72 429.84 10.74 not ascertainable 381.89 126.55 10.74 not ascertainable
(iv) in case of disputes decided in favour of the group at the First appellate authority for amounts disallowed amounting to ` 1,639. 24 million (previous year ` nil), the department has gone for further appeal in all the cases. if decided against the company, it will result in reduction of unabsorbed losses and unabsorbed depreciation as per the income -tax law (v) in case of disputes decided against the group for amounts disallowed amounting to ` 16.14 million (previous year ` 389.77 million), the company has gone for further appeal in all the cases. if decided against the company, it will result in reduction of unabsorbed losses and unabsorbed depreciation as per the income-tax law
(B) cAPITAl cOMMITMENTS
Particulars (i) estimated amount of contracts remaining to be executed on capital account and not provided for net of advances paid aggregate ` 5,842.65 ( previous year ` 6,868.17 million) As at March 31, 2012 61,221.11
` in million As at March 31, 2011 62,300.32
(ii) exercise price payable in respect of call option contracts (iii) investment commitments [net of advances of ` 269.80 million, (as at March 31, 2011 : ` 469.80 million)]
200.00
11.77 320.00
(c) OTHER cOMMITMENTS
Particulars (i) negative grant to national Highways authority of india ("nHai") (upto 2019-20) As at March 31, 2012 2,700.00
` in million As at March 31, 2011 2,800.00
138
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 24 : REvENUE fROM OPERATIONS
Year ended March 31, 2012 1,905.89 342.13 7,167.44 2,781.32 3,108.60 12.61 79.30
` in million Year ended March 31, 2011 809.13 124.88 8,635.21 1,870.15 68.52 1,827.57 40.50 47.45
Income from services advisory and project management fees lenders' engineer and supervision fees operation and maintenance income toll revenue periodic maintenance income Finance income licence fee operation and maintainace grant from nHai (b) Construction income (c) sales (net of sales tax) ToTAL
(a)
15,397.29 40,602.72 56.20 56,056.21
13,423.41 26,944.19 114.66 40,482.26
NOTE 25 : OTHER INcOME
Particulars (a) Interest Income interest on loans granted interest on debentures interest on call money interest on bank deposits interest on short term deposit interest on advance towards property (b) Profit on sale of investment (net) (c) Profit on sale of fixed assets (d) Dividend income (e) other non-operating income advertisement income excess provisions written back exchange rate fluctuation gain (net) Miscellaneous income ToTAL Year ended March 31, 2012
` in million Year ended March 31, 2011
535.88 86.59 33.94 96.41 36.27 141.86
930.95 8.58 0.33 2.10
401.80 46.65 31.44 72.69 14.88 123.60
691.06 4.27 0.80 10.37
1.10 33.06 73.09 188.86
296.11 1,238.07
4.31 0.05 75.42
79.78 786.28
NOTE 26 : cOST Of MATERIAlS cONSUMED
Particulars (a) Material consumption (b) purchase of traded products ToTAL Year ended March 31, 2012 1,211.90 30.14 1,242.04 1,242.04
` in million Year ended March 31, 2011 1,252.37 117.92 1,370.29 1,370.29
139
transportation
annual report 2011-12
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 27 : OPERATINg EXPENSES
Year ended March 31, 2012 30,512.48 554.89 220.64 1,703.91 130.48 13.11 19.08 100.00 33,254.59 33,254.59
` in million Year ended March 31, 2011 17,896.53 382.81 196.57 3,146.64 113.56 62.09 26.82 21,825.02 21,825.02
construction contract costs Fees for technical services / design and drawings Diesel and fuel expenses operation and maintenance expenses provision for overlay expenses periodic maintenace expenses toll plaza expenses negative grant to nHai ToTAL
NOTE 28 : EMPlOYEE BENEfITS EXPENSE
Particulars Salaries and wages contribution to provident and other funds (refer foot notes below) Staff welfare expenses ToTAL fooTNoTe: (i) employee benefit obligations: (a) Defined-contribution plans Year ended March 31, 2012 2,941.36 655.45 97.10 3,693.91 3,693.91
` in million Year ended March 31, 2011 2,870.22 56.06 595.30 3,521.58 3,521.58
(i) the group offers its employees defined contribution benefits in the form of provident fund, family pension fund and superannuation fund. provident fund, family pension fund and superannuation fund cover substantially all regular employees. contributions are paid during the year into separate funds under certain statutory / fiduciary-type arrangements. while both the employees and the group pay predetermined contributions into the provident fund and pension fund, contributions to superannuation fund are made only by the group. the contributions are normally based on a certain proportion of the employee’s salary (ii) a sum of ` 23.84 million (previous year ` 14.64 million) has been charged to the consolidated Statement of profit and loss in this respect (B) Defined–benefit plans: the group offers its employees defined-benefit plans in the form of gratuity (a lump sum amount). amounts payable under defined benefit plans are typically based on years of service rendered and the employee’s eligible compensation (immediately before retirement). the gratuity scheme covers substantially all regular employees. in the case of the gratuity scheme, the group contributes funds to the life insurance corporation of india which administers the scheme on behalf of the group. commitments are actuarially determined at year end. actuarial valuation is based on “projected unit credit” method. gains and losses due to changes in actuarial assumptions are charged to the consolidated Statement of profit and loss
140
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
the net value of the defined-benefit commitment is detailed below: ` in million As at March 31, 2012 57.39 56.35 1.04 As at March 31, 2011 41.65 46.28 0.64 (3.99)
present value of commitment Fair value of plans unrecognised past service cost Payable / ( Prepaid) amount taken to the balance sheet Defined benefit commitments:
` in million gratuity opening balance interest cost current service cost Benefits paid actuarial (gain) / loss transferred from / to other company Closing balance plan assets: ` in million gratuity opening balance expected return on plan assets contributions by the company / group Benefits paid transferred from / to other company actuarial gain / (loss) other adjustments fair value of plan assets As at March 31, 2012 46.31 4.11 11.82 (7.19) 1.17 0.15 (0.02) 56.35 As at March 31, 2011 35.27 3.24 14.30 (5.79) (1.82) 1.11 46.31 As at March 31, 2012 41.65 3.25 14.21 (7.19) 4.30 1.17 57.39 As at March 31, 2011 28.80 2.23 12.22 (5.79) 6.65 (2.46) 41.65
the plan assets are managed by life insurance corporation of india and HDFc Standard life insurance and the group does not have details as to the investment pattern return on plan assets: ` in million gratuity expected return on plan assets actuarial gain / (loss) actual return on plan assets Year ended March 31, 2012 4.11 0.15 4.26 Year ended March 31, 2011 3.24 1.11 4.35
141
transportation
annual report 2011-12
Notes
gratuity
forming part of the Consolidated Financial statements for the year ended March 31, 2012
expenses on defined benefit plan recognised in the consolidated Statement of profit and loss: ` in million Year ended March 31, 2012 14.21 3.25 (4.11) 4.15 17.50 Year ended March 31, 2011 12.22 2.23 (3.24) 5.53 16.74
current service cost interest expenses expected return on investments net actuarial (gain) / loss expenses charged to Consolidated statement of Profit and Loss
(i) the actuarial calculations of estimated defined benefit commitments and expenses are based on the following assumptions, which if changed would affect the defined benefit commitment’s size, funding requirements and pension expense Name of the Entity Year Ended March 31, 2012 group entities other than a jointly controlled entity rate for discounting liabilities expected salary increase rate expected return on scheme assets attrition date Mortality table used 8.25%-8.50% 6.00%-6.50% 8.00% 2% lic (1994-96) ultimate Jointly controlled entity Year Ended March 31, 2011 group entities other than a jointly controlled entity 8.25% 4.50%-6.00% 8.00% -8.25% 2% lic (1994-96) ultimate Jointly controlled entity
8.25%-8.50% 6.50% 6.50% not disclosed not disclosed
8.25% 6.00% 5.00% not disclosed not disclosed
(ii) the estimates of future salary increases considered in the actuarial valuation take into account inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market (iii) the amounts of the present value of the obligation, fair value of the plan assets, surplus or deficit in the plan, experience adjustments arising on plan liabilities and plan assets for the current period and previous three annual periods is given below: ` in million gratuity (funded Plan) Defined benefit commitments plan assets unfunded liability transferred from group companies (surplus) / Deficit As at As at As at As at As at March 31, 2012 March 31, 2011 March 31, 2010 March 31, 2009 March 31, 2008 57.39 56.35 1.04 41.65 46.28 0.64 (3.99) 28.80 35.27 (6.47) 21.50 (26.41) (4.91) 21.64 (23.07) 0.07 (1.36) ` in million gratuity (funded Plan) experience adjustments commitments experience assets adjustments on on plan plan Year ended Year ended Year ended Year ended Year ended March 31, 2012 March 31, 2011 March 31, 2010 March 31, 2009 March 31, 2008 (0.40) (0.35) 4.32 1.11 (0.87) 0.15 6.22 (1.34) 8.99 (0.93)
(iv) the contribution expected to be made by some of the constituents of the group during the financial year 2012-13 is ` 49.82
142
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 29 : fINANcE cOSTS
Year ended March 31, 2012 6,599.57 80.44 135.12 26.38 440.56
` in million Year ended March 31, 2011 3,825.82 217.43 3.06 37.62 896.65
Interest expenses interest on loans for fixed period interest on debentures interest on deep discount bonds (b) other finance charges guarantee commission Finance charges ToTAL
(a)
6,815.13
4,046.31
466.94 7,282.07
934.27 4,980.58
NOTE 30 : ADMINISTRATIvE AND gENERAl EXPENSES
Particulars legal and consultation fees travelling and conveyance rent rates and taxes repairs and maintenance others Bank commission communication expenses insurance exchange rate fluctuation loss (net) printing and stationery electricity charges Bad debts and provision for doubtful debts loss on sale of fixed assets (net) Brand subscription fees Miscellaneous expenses ToTAL Year ended March 31, 2012 274.52 338.33 488.10 72.87 103.98 232.26 67.08 140.87 38.37 34.77 316.85 3.30 218.25 880.63 3,210.18 3,210.18
` in million Year ended March 31, 2011 273.78 283.56 468.34 113.84 89.78 98.76 68.42 106.71 6.57 54.17 18.33 51.99 10.78 140.36 431.71 2,217.10 2,217.10
NOTE 31 : EARNINgS PER EQUITY SHARE
Particulars profit for the year premium on preference shares of subsidiary Dividend tax on premium on preference shares of subsidiary profit available for equity Shareholders weighted average number of equity Shares outstanding nominal value per equity share Basic earnings per share weighted average number of equity shares used to compute diluted earnings per share Diluted earnings per share Unit ` in million ` in million ` in million ` in million number ` ` number ` Year ended March 31, 2012 4,969.58 (16.19) (2.63) 4,950.76 194,267,732 10.00 25.48 194,267,732 25.48
` in million Year ended March 31, 2011 4,328.79 (16.14) (2.68) 4,309.97 194,267,732 10.00 22.19 194,267,732 22.19
in the absence of clarity as to the impact of advance towards capital on the earnings of the group, no adjustment has been made for potential dilution in computing diluted earnings per share
143
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 32 : INvESTMENTS IN AHA
investments in airport Holding australasia pte limited (aHa) has not been considered as investments in associates as in the view of the Management, no significant influence exist
NOTE 33 : DISclOSURE IN TERMS Of AccOUNTINg STANDARD (AS) 7 – cONSTRUcTION cONTRAcTS
Particulars contract revenue recognised as revenue during the year ended aggregate amount of contract costs incurred recognised profits up to gross amount due from customers for contract work, disclosed as asset, as at gross amount due to customers for contract work, disclosed as liability as at the As at March 31, 2012 764.69 545.91 As at March 31, 2011 1,230.32 1,230.32 6.38 208.47
` in million
NOTE 34 : DISclOSURE Of lEASES
(A) operating Lease: the group holds certain properties under a non-cancellable operating lease. the group’s future lease rentals under the operating lease arrangements as at the year-end are as under: (a) For entities other than jointly controlled entities ` in million future lease rentals within one year over one year but less than 5 years More than 5 years Year ended March 31, 2012 365.87 161.83 44.80 Year ended March 31, 2011 345.26 130.76 76.02
the lease terms do not contain any exceptional / restrictive covenants nor are there any options given to group to renew the lease or purchase the properties. the agreements provide for changes in the rentals if the taxes leviable on such rentals change ` in million Particular amount charged to the consolidated Statement of profit and loss for rent (b) finance Leases: (a) Subsidiaries ` in million Particular March 31, 2012 Minimum Present value of lease lease minimum lease charges Payment payments amount payable not later than one year amount payable >1 but < 5 years amount payable > 5 years ToTAL 71.56 83.17 41.32 196.05 65.22 71.16 38.90 175.28 6.34 12.00 2.41 20.75 March 31, 2011 Minimum Present value lease lease of minimum charges Payment lease payments 135.87 104.98 44.96 285.81 128.96 95.40 41.85 266.21 6.91 9.58 3.11 19.60 for the year ended March 31, 2012 434.54 for the year ended March 31, 2011 323.60
144
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
(b) Jointly controlled entities a jointly controlled entity had taken a vehicle under finance lease. the reconciliation of minimum lease payments and their present value is as under: ` in million Particular March 31, 2012 Minimum Present value of lease lease minimum lease charges Payment payments amount payable < 1 year amount payable >1 but < 5 years ToTAL March 31, 2011 Minimum Present value lease lease of minimum charges Payment lease payments 0.12 0.12 0.11 0.11 0.00 0.00
NOTE 35 : the group’s percentage holding in various jointlly controlled entities are given below:
Name of the jointly controlled entity ntBcl JSel nel yuhe (from December 27, 2011) As at As at March 31, 2012 March 31, 2011 % holding 25.35 50.00 50.00 49.00 % holding 25.35 50.00 50.00 -
the proportionate share in assets, liabilities, income and expenditures of above jointly controlled entities as included in these cFS is given below: ` in million Particulars Assets Fixed assets (net) Deferred tax assets loans and advances (current and non-current) other non-current assets current investments other current assets equity and Liabilities reserves and surplus loans Deferred tax liability other liabilities As at March 31, 2012 19,642.53 2.21 388.24 2,225.33 89.90 255.83 22,604.04 749.81 10,928.58 183.95 1,034.61 12,896.95 As at March 31, 2011 2,559.32 431.37 1,201.30 60.23 968.56 5,220.78 1,535.83 751.47 15.34 1,234.86 3,537.50
145
transportation
annual report 2011-12
Notes
Particulars Income
forming part of the Consolidated Financial statements for the year ended March 31, 2012
` in million for the year ended for the year ended March 31, 2012 March 31, 2011 4,188.17 24.44 4,212.61 expenses operating expenses administrative and general expenses Depreciation and amortization expense Finance costs taxes - current tax - Deferred tax 466.52 149.73 110.23 282.49 13.46 166.45 1,188.88 1,200.09 76.41 10.03 106.67 7.36 15.34 1,415.90 ` in million Particulars contingent liabilities capital commitments As at March 31, 2012 5,725.12 As at March 31, 2011 12.51 8,814.16 2,454.15 22.61 2,476.76
revenue from operations other income
NOTE 36 :
the concession arrangements of the group relate primarily to the construction, operation and maintenance of carriageways (roads) and gas stations by special purpose entities within the group, which at the end of the concession period must be returned in the stipulated conditions to the grantors of the concessions. in consideration for having designed, constructed, operated and maintained such carriageways, the group is entitled either to “annuities” from grantors or is entitled charge “toll” to the users of the carriageways or in the case of gas stations, to compensation from the oil companies besides other revenue from ancillary commercial activities (i) the following are toll based service concession arrangements of the group which have been classified as “intangible assets” in the note 13 to the financial statements: a) the vadodara Halol road project (“vHrp”) and the ahmedabad Mehsana road project (“aMrp”) are concession arrangements entered into with the government of gujarat through gujarat road and infrastructure company limited (“gricl”). the construction activities of vHrp and aMrp were completed on october 24, 2000 and February 20, 2003 respectively. Maintenance activities cover routine maintenance, overlays and renewals. the concessions, which have been granted for periods of 30 years from those dates, envisage that gricl will earn a designated return over the concession periods. in the event gricl is unable to earn the designated return gricl would be entitled to an extension by two years at a time until the project cost and the returns thereon are recovered by it. the amount of toll recoverable from users is linked to the movements in the consumer price index and to custom escalators. premature termination before the said period of 30 years is not permitted except in the event of a force majeure. premature termination without the default on the part of gricl will entitle gricl to the cost of the project and return thereon remaining to be recovered as on the date of transfer. at the end of the concession period, gricl is required to hand back the carriageway to the grantor at a nominal consideration
146
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
b) the Delhi noida Bridge project (“DnBp”) concession arrangement has been entered into between the new okhla industrial Development authority (noiDa) and noida toll Bridge company limited (“ntBcl”). the construction activity was completed on February 7, 2001. Maintenance activities cover routine maintenance, overlays and renewals. the concession, which has been granted for a period of 30 years from February 7, 2001, envisages that ntBcl will earn a designated return over the concession periods. in the event ntBcl is unable to earn the designated return, ntBcl would be entitled to an extension by two years at a time until the project cost and the returns thereon are recovered by it. the amount of toll recoverable from users is linked to the movements in the consumer price index. premature termination before the said period of 30 years is not permitted except in the event of a force majeure. premature termination without default on the part of ntBcl will entitle ntBcl to the cost of the project and returns thereon remaining to be recovered as on the date of transfer. at the end of the concession period, ntBcl is required to hand back the carriageway to the grantor at a nominal consideration c) elsamex Sa, its subsidiaries and joint ventures, (the “elsamex group”) have entered into Service concession arrangements(“Sca”) for construction and operation and maintenance of five gas stations in Spain and for the construction and operation and maintenance of a road project in Spain with the government authorities the periods for which the Scas have been granted are as under: Operations and Maintenance period
Project orihuela gas Station villavidel gas Station Zamora gas Station ponferrada gas Station coiros gas Station a4 road alcantarilla Fotovoltaica, S.l.u.
Date of ScA June 11, 2001
Status construction completed
Termination date
25 years and 8 months June 11, 2030 from november 11, 2004 40 years and 1.5 months September 12, 2045 from July 29, 2004 43 years and 4 months June 24, 2048 from February 23, 2005 45 years and 10 months august 04, 2050 from october 26, 2006 39 years 19 years 25 years april 14, 2043 December 26, 2026 november 10, 2035
September 12, 2001 construction completed June 24, 2002 august 4, 2004 april 16, 2004 construction completed construction completed under construction
December 27, 2007 under construction november 11, 2010 under construction
Maintenance activities for the gas stations and road project include routine operating and maintenance as well as periodic overhauling and refurbishment to maintain the stations to the defined standards. in consideration for performing its obligations under the Sca, elsamex is entitled to compensation from the oil companies computed at a predefined proportion of the sale of products at the gas stations and in the form of a “shadow toll” based on the units of usage i.e. the number of vehicles using the road in respect of road project d) the Beawar gomti road project (“Bgrp”) concession arrangement has been entered into between the president of india, represented by Special Secretary and Director general (road Development), (“DortH”) and itnl road infrastructure Development company limited (“iriDcl”). iriDcl is required to design, build, finance and operate the Bgrp for a period of 30 years commencing from the appointed date i.e. october 28, 2009, provided that in the event of four-laning not being undertaken for any reason in accordance with the provisions of concession agreement, the concession period shall be deemed to be 11 years including construction period of 455 days for 2- laning of the Bgrp Maintenance activities cover routine maintenance, . overlays and renewals. premature termination before the said period of concession is not permitted except
147
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
in the event of a force majeure. premature termination without the default on the part of irDcl will entitle iriDcl to be eligible for the compensation as per the concession arrangement. at the end of the concession period, iriDcl is required to hand back Bgrp to the grantor without additional consideration e) the Jetpur-gondal-rajkot road project (“Jgrrp”) is a concession arrangement entered into between the national Highways authority of india (“nHai”) and west gujarat expressway limited (“wgel”). the concession has been granted to wgel for a period of 20 years ending on September 17, 2025. the construction activity was completed on March 17, 2008. Maintenance activities cover routine maintenance, overlays and renewals. in consideration, wgel will be entitled to collect toll/user charges from the users of Jgrrp the amount of . toll recoverable from users is linked to the movements in the wholesale price index. also on dates specified in the concession agreement, wgel will be entitled to a “grant” by way of cash support from nHai, but it also obligated to pay a “negative grant” by way of cash payment to nHai. premature termination before the said period of 20 years is not permitted except in the event of a force majeure. the concession does not provide for renewal options. at the end of the concession period, Jgrrp is required to hand back the carriageway to the grantor without additional consideration f) the pune Sholapur road project (“pSrp”) concession arrangement has been entered into between nHai and pune Sholapur road Development company limited (“pSrDcl”). pSrDcl is required to design, build, finance and operate the pSrp for a period of 20 years commencing from the appointed date including construction period of 910 days. Maintenance activities cover routine maintenance, overlays and renewals. the amount of toll recoverable from users is linked to the movements in the consumer price index. premature termination before the said period of concession is not permitted except in the event of a force majeure. premature termination without the default on the part of pSrDcl will entitle pSrDcl to be eligible for the compensation as per the concession arrangement. at the end of the concession period, pSrp is required to hand back the carriageway to the grantor without additional consideration g) the Moradabad Bareilly road project (“MBrp”) is a concession arrangement entered into between nHai and Moradabad Bareilly expressway limited (“MBel”). MBel is required to design, build, finance, operate and transfer the MBrp for a period of 25 years commencing from the appointed date including construction period of 910 days. Maintenance activities cover routine maintenance, overlays and renewals. the amount of toll recoverable from users is linked to the movements in the consumer price index. premature termination before the said period of concession is not permitted except in the event of a force majeure. premature termination without default on the part of MBel will entitle MBel to be eligible for compensation as per the concession. at the end of the concession period, MBrp is required to hand back the carriageway to the grantor without additional consideration h) the company has entered into a concession contract agreement with Haryana urban Development authority (HuDa) on 9 December, 2009 for development of Metro rail project from Delhi Metro Sikanderpur Station on Mg road, gurgaon to nH-8 (‘the project’). as per the terms of the contract, the company accepts the concession for a period of 99 years commencing from the effective date, to develop and operate the project. the company has not yet started any significant construction activity, therefore intangible asset covered under ‘Service concession arrangement’ have been carried at cost i) the narketpally adanki project (“nap”) is a concession arrangement entered into between andhra pradesh road Development corporation and n. a. M. expressway limited (“nel”). nel is required to design, build, finance, operate and transfer the nap for a period of 24 years commencing from the appointed date including construction period of 30 months. Maintenance activities cover routine maintenance, overlays and renewals. the amount of toll recoverable from users is linked to the movements in the consumer price index. premature termination before the said period of concession is not permitted except in the event of a force majeure. premature termination without default on the part of nel will entitle nel to be eligible for compensation as per the concession. at the end of the concession period, nap is required to hand back the carriageway to the grantor without additional consideration
SuStainaBle that’s itnl for you
148
SaFe
SoliD
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
j)
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Mp Border checkpost project (“MpBcp”) is a concession agreement granted by Mp road Development corporation limited (MprDcl) for construction, operation and maintenance of the Border checkposts at 24 locations in Madhya pradesh to Mp Border checkpost Development company ltd (MpBcDcl) for a period of 4566 days commencing from the appointed date. as per the concession agreement, MpBcDcl has obligation to undertake the design, engineering, procurement, construction, operation and maintenance of the project in consideration, the company is entitled to collect service fees from the users in accordance with the concession agreement. at the end of the concession period, the company will hand over the infrastructure to MprDcl
k) the Kiratpur net chowk project (“Kncp”) is a concession arrangement entered into between national Highways authority limited and Kiratpur net chowk expressway limited (“Kncel”). Kncel is required to build, operate and transfer the Kncp for a period of 28 years commencing from the appointed date including construction period of 30 months. Maintenance activities cover routine maintenance, overlays and renewals. the amount of toll recoverable from users is linked to the movements in the consumer price index. premature termination before the said period of concession is not permitted except in the event of a force majeure. premature termination without default on the part of Kncel will entitle Kncel to be eligible for compensation as per the concession l) the chongqing yuhe expressway project (“cyep”) is a concession arrangement entered into between people’s repubic of china and chongqing yuhe expressway company limited (“yuhe”). the government has granted the right to charge the users of chongqing yuhe expressway for a period of 20 years to yuhe. the premature termination before the said period of concession is not permitted except in the event of a force majeure
(ii) the following are annuity based service concession arrangements of the group which have been classified as financial assets under “receivables against service concession arrangements” in the financial statements in note 19: a) the north Karnataka expressway project (“nKep”) is a concession arrangement granted by national Highways authority of india (“nHai”) for a period of 17 years and 6 months from June 20, 2002 to north Karnataka expressway limited (“nKel”). the construction activities were completed on July 19, 2004. Besides construction, nKel’s obligations include routine maintenance and period maintenance of the flexible pavement and the rigid pavement at predefined intervals. in consideration, nKel is entitled to a defined annuity. at the end of the concession period nKep is required to be handed over in a stipulated condition to the grantor. premature termination is permitted only upon the happening of a force majeure event or upon the parties defaulting on their obligations. the concession arrangement does not provide for renewal options b) the Hyderabad outer ring road (“Horr”) is a concession arrangement granted by Hyderabad urban Development authority (“HuDa”) for a period of 16 years including construction period of 3 years from august 31, 2007 to east Hyderabad expressway limited (“eHel”). Besides construction, eHel’s obligations include routine maintenance and period maintenance of the flexible pavement and the rigid pavement at predefined intervals. in consideration, eHel is entitled to a defined annuity. at the end of the concession period Horr is required to be handed over in a stipulated condition to the grantor. premature termination is permitted only upon the happening of a force majeure event or upon the parties defaulting on their obligations. the concession arrangement does not provide for renewal options c) the Hazaribagh ranchi road project (“Hrrp”) is a concession arrangement granted by the “nHai” for a period of 18 years including construction period of 910 days from october 8, 2009 to Hazaribagh ranchi expressway limited (“Hrel”). Besides construction, Hrel’s obligations include routine maintenance and period maintenance of the flexible pavement and the rigid pavement at predefined intervals. in consideration Hrel is entitled to a defined annuity. at the end of the concession period Hrrp is required to be handed over in a stipulated condition to the grantor. premature termination is permitted only upon the happening of a force majeure event or upon the parties defaulting on their obligations. the concession arrangement does not provide for renewal options 149
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
d) as per the concession agreements dated September 23, 2009 in respect of the ranchi ring road project (“rrrp”) and on october 14, 2009 in respect of the ranchi - patratu Dam road project (“rpDrp”) and patratu Dam- ramgarh road project (“pDrrp”) with the govt. of Jharkhand (“goJ”) and Jharkhand accelerated road Development company limited (“JarDcl”), Jharkhand road project implementation company limited (“Jrpicl”) is required to develop, design, finance, procure, engineering, construct, operate and maintain the rrrp rpDrp and pDrrp for a period of 17 years and six months from commencement date. Besides , construction, Jrpicl’s obligations include routine maintenance and period maintenance of the flexible pavement and the rigid pavement at predefined intervals. in consideration, Jrpicl is entitled to a defined annuity. at the end of the concession period rrrp rpDrp and pDrrp are required to be handed over in , the stipulated condition to the grantor. premature termination is permitted only upon the happening of a force majeure event or upon the parties defaulting on their obligations. the concession arrangements do not provide for renewal options e) the chenani nashri tunnel project (“cntp”) is a concession arrangement granted by the “nHai” for a period of 20 years including construction period of 1825 days to chenani nashri tunnelway limited (“cntl”). Besides construction, cntl’s obligations include routine maintenance of the projects and if required, modify, repair, improvements to the project highway to comply with specification and standards. in consideration cntl is entitled to a defined annuity. at the end of the concession period cntp is required to be handed over in a stipulated condition to the grantor. the concession arrangement does not provide for renewal options f) the Jorabat Shillong project (“JSp”) is a concession arrangement granted by the “nHai” for a period of 20 years including construction period of three years form appointed date to Jorabat Shillong expressway limited (“JSel”). Besides construction, JSel’s obligations include routine maintenance and period maintenance of the flexible pavement and the rigid pavement at predefined intervals. in consideration JSel is entitled to a defined annuity. at the end of the concession period JSel is required to be handed over in a stipulated condition to the grantor. premature termination is permitted only upon the happening of a force majeure event or upon the parties defaulting on their obligations. the concession arrangement does not provide for renewal options
NOTE 37 :
Segment reporting - refer annexure - i
NOTE 38 :
related party Disclosure - refer annexure ii
NOTE 39 :
Statement to be furnished under section 212 (8) of companies act, 1956 relating to subsidiaries includes the financial information of the subsidiaries received for the purpose of preparation of the consolidated financials statements refer annexure iii
NOTE 40 :
previous year : consequent to the notiFication no. S.o. 447(e), DateD 28-2-2011 [aS aMenDeD By notiFication no. F.no. 2/6/2008-cl-v, DateD 30-3-2011] the above financial statements have been presented in accordance with the revised Schedule vi. as required under the said notification corresponding figures for the previous year have been reclassified and presented in accordance with the current year presentation For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 150
SaFe SoliD SuStainaBle that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 37 : SEgMENT REPORTINg
Surface Transportation Business revenue external inter-Segment segment revenue Segment expenses Segment results unallocated income (excluding interest income) unallocated expenditure Finance cost interest income unallocated tax expense (net) Share of profit / (loss) of associates (net) Share of profit transferred to minority interest (net) Profit for the year segment assets unallocated assets (refer footnote 1) Total assets segment liabilities unallocated liabilities (refer footnote 2) Total liabilities Capital expenditure for the year Depreciation and amortization expense Non cash expenditure other than depreciation for the year
ANNEXURE I
` in million Other Total
2011-2012 2010-2011 2011-2012 2010-2011 2011-2012 2010-2011 54,418.84 54,418.84 40,245.14 14,173.70 38,825.65 38,825.65 27,834.04 10,991.61 1,637.37 1,637.37 1,478.82 158.55 1,656.61 1,656.61 1,500.67 155.94 56,056.21 56,056.21 41,723.96 14,332.25 307.12 442.28 7,282.07 930.95 2,457.21 38.53 457.71 4,969.58 135,636.94 13,269.55 20,355.66 717.25 79,921.95 10,510.70 14,176.37 571.64 1,989.55 1,303.28 48.27 1,627.85 137,626.49 14,853.34 152,479.83 1,140.55 14,572.83 107,334.44 121,907.27 20,355.66 42.55 765.52 447.34 40,482.26 40,482.26 29,334.71 11,147.55 95.22 213.47 4,980.58 691.06 2,242.45 (47.81) 120.73 4,328.79 81,549.80 12,676.15 94,225.95 11,651.25 58,007.36 69,658.61 14,176.37 614.19 612.88
II) seCoNDArY - geogrAPhICAL segmeNTs: ` in million India 2011-12 revenue - external Segment assets capital expenditure 48,112.63 113,289.26 19,566.64 Outside India 2011-12 30,830.94 72,056.38 13,927.36 India 2010-11 7,943.58 24,337.22 789.02 Outside India 2010-11 9,650.52 9,493.42 249.01
1) unallocated assets include investments, advance towards share application money, loans given, interest accrued, option premium, deferred tax assets, advance payment of taxes (net of provision), unpaid dividend accounts and fixed deposits placed for a period exceeding 3 months, etc 2) unallocated liabilities include borrowings, interest accrued but not due on borrowings, deferred tax liabilities (net), provision for tax (net), unpaid dividends, etc
151
transportation
annual report 2011-12
Notes
i.
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES CUrreNT YeAr
ANNEXURE II
a) name of the related parties and Description of relationship: Nature of Relationship holding Company fellow subsidiaries (only with whom there have been transaction during the year / there was balance outstanding at the year end) Name of Entity infrastructure leasing & Financial Services limited il&FS Financial Services limited il&FS education & technology Services limited il&FS energy Development company limited il&FS environmental infrastructure & Services limited il&FS infrastructure Development corporation limited il&FS investment Managers limited il&FS Maritime infrastructure company limited il&FS urban infrastructure Managers limited chattisgarh Highways Development company limited il&FS global Financial Services (Me) limited il&FS global Financial Services pte limited il&FS Securities Services limited il&FS township & urban assets limited (formerly known as Mppl enterprises limited) il&FS trust company limited Jharkhand accelerated road Development company limited andhra pradesh expressway limited itnl toll Management Services limited thiruvananthpuram road Development company limited warora chandrapur Ballarpur toll road limited centro De investigacion De carreteras De andalucia S.a. cgi-8, S.a. labtec ensayos tecnicos canarios S.a. empresas pame Sa Decv elsamex road technology company limited ramky elsamex Hyderabad ring road Sociedad concesionaria autovia a-4 Madrid S.a. alcantarilla Fotovolcaica Sa Zheisiang elsamex road tech company yala construction company limited-thailand vcS enterprises limited Mr K ramchand-Managing Director and relatives Mr Mukund Sapre-executive Director and relatives Acronym used ilFS iFin ietS ieDcl ieiSl iiDcl iiMl iMicl iuiMl cHDcl igFSMl igFSpl iSSl itual itcl JarDcl apel itMSl trDcl wcBtrl cican cgi-8 laBtec epSD ertc reHrr a4 conceSSion aFSa Zheisiang elsamex thailand vcSel
Associates
Key management Personnel
152
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 38 (i) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives
Total
bALANCes: Advance towards capital in a subsidiary ilFS Interest accrued (current and non-current) ilFS apel trDcl otHerS Inter-corporate deposits ilFS Investment in Debentures apel Investment in Covered Warrants ilFS short-term Lendings apel trDcl otHerS Long-term Lendings apel a4 conceSSion trDcl otHerS Advances recoverable in Cash or Kind apel a4 conceSSion Zheisiang elsamex otHerS Trade Payables ilFS iFin otHerS
150.00 150.00 21.11 21.11 673.30 673.30 1,693.00 1,693.00 -
1.56 1.56 73.00 73.00 -
312.38 43.06 1.97 357.41 786.40 786.40 751.00 215.00 34.00 1,000.00 474.60 373.87 171.80 217.02 1,237.29 1.63 1.63 13.19 13.19
-
150.00 150.00 21.11 312.38 43.06 3.53 380.08 673.30 673.30 786.40 786.40 1,693.00 1,693.00 751.00 215.00 107.00 1,073.00 474.60 373.87 171.80 217.02 1,237.29 1.63 1.94 12.14 0.20 15.91 62.57 476.08 141.67 680.32
62.57 62.57
1.94 12.14 0.20 14.28 476.08 128.48 604.56
-
153
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
a) transactions/ balances with above mentioned related parties (mentioned in note 38 (i) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives
Total
Trade receivables ilFS iFin a4 conceSSion wcBtrl otHerS
16.42 16.42
387.15 0.26 387.41
613.86 599.00 348.18 1,561.04
-
16.42 387.15 613.86 599.00 348.44 1,964.87
Unsecured Loans and Advances from related Parties ilFS
288.00 288.00
-
-
-
288.00 288.00
option premium assets (Long-term loans and advances) ilFS (net of provision of ` 163.28 million) Long-term borrowings ilFS
36.67 36.67 732.82 732.82
-
-
-
36.67 36.67 732.82 732.82
redemption premium accrued but not due on borrowings ilFS Current liabilities ilFS
291.02 291.02 28.73 28.73
. -
-
-
291.02 291.02 28.73 28.73
Transactions Inter-corporate deposits - matured ilFS
Inter-corporate deposits - placed ilFS operating expenses ilFS ieiSl
6,203.19 6,203.19 6,606.49 6,606.49 0.58 0.58
11.87 11.87
-
-
6,203.19 6,203.19 6,606.49 6,606.49 0.58 11.87 12.45
154
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURE - (contd.)
a) transactions/ balances with above mentioned related parties (mentioned in note 38 (i) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives 2.75 2.75 -
Total
Lendings apel trDcl otHerS repayment of Lendings apel other Income ilFS apel otHerS revenue from operations iFin wcBtrl apel otHerS Administrative and general expenses ilFS ietS otHerS Investment made / purchased ilFS wcBtrl otHerS borrowings ilFS repayment of borrowings ilFS iSSl Interest on Loans (expense) ilFS otHerS
57.29 57.29 302.09 302.09 1,187.50 1,187.50 800.00 800.00 903.89 903.89 182.67 182.67
73.00 73.00 1.73 1.73 390.00 0.14 390.14 43.59 26.88 70.47 0.00 0.00 1,000.00 1,000.00 4.27 4.27
791.00 165.00 956.00 651.00 651.00 230.49 61.99 292.48 371.71 116.42 26.06 514.19 17.44 17.44 616.91 616.91 -
791.00 165.00 73.00 1,029.00 651.00 651.00 57.29 230.49 63.72 351.50 390.00 371.71 116.42 26.20 904.33 302.09 43.59 47.07 392.75 1,187.50 616.91 0.00 1,804.41 800.00 800.00 903.89 1,000.00 1,903.89 182.67 4.27 186.94
155
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
a) transactions/ balances with above mentioned related parties (mentioned in note 38 (i) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives -
Total
finance charges ilFS iFin itcl itual igFSMl otHerS Intangible assets under development ilFS iFin otHerS
3.43 3.43 35.01 35.01
62.51 49.65 55.15 37.76 15.72 220.79 125.63 12.92 138.55
-
3.43 62.51 49.65 55.15 37.76 15.72 224.22 35.01 125.63 12.92 173.56
redemption of Non convertible Debentures ilFS
36.00 36.00
-
-
-
36.00 36.00
guarantee commision ilFS
15.29 15.29
-
-
-
15.29 15.29
Dividend paid ilFS
472.74 472.74
-
-
-
472.74 472.74
Director remuneration Mr. K ramchand Mr. Mukund Sapre
-
-
-
53.08 28.77 81.85
53.08 28.77 81.85
156
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
ii. PrevIoUs YeAr a) name of the related parties and description of relationship: Nature of Relationship holding Company fellow subsidiaries (only with whom there have been transaction during the year / there was balance outstanding at the year end) Name of Entity infrastructure leasing & Financial Services limited il&FS Financial Services limited (erst while il&FS Finvest ltd.) il&FS ecosmart limited (upto March 29, 2011) il&FS education & technology Services limited il&FS energy Development co ltd (from December 3, 2010) il&FS environmental infrastructure & Service limited (formerly il&FS waste Management & urban Services limited) il&FS infrastructure Development corporation limited il&FS investment Managers limited il&FS Maritime infrastructure company limited il&FS property Management & Services limited (upto october 1, 2010) il&FS renewable energy limited chattisgarh Highway Development company limited il&FS Securities Services limited il&FS trust company limited il&FS water limited Jharkhand accelerated road Development company limited tamil nadu water investment company limited il&FS cluster Development initiative limited il&FS global Financial Services (uK) limited il&FS urban infrastructure Managers limited il&FS urban infrastructure Services limited (upto March 29, 2011) andhra pradesh expressway limited itnl toll Management Services limited thiruvananthpuram road Development company limited warora chandrapur Ballarpur toll road limited labtec ensayos tecnicos canarios S.a. centro De investigacion De carreteras De andalucia S.a. cgi-8, S.a. empresas pame Sa Decv (from april 28, 2010) ramky elsamex Hyderabad ring road Sociedad concesionaria autovia a-4 Madrid S.a. Zheisiang elsamex road tech company yala construction company limited vcS enterprises limited Mr. K ramchand-Managing Director and relatives Mr. Mukund Sapre-executive Director and relatives
ANNEXURE II
Acronym used ilFS iFin iel ietS ieDcl ieiSl iiDcl iiMl iMicl ipoMSl irel cHDcl iSSl itcl iwl JarDcl twicl icDil igFSl(uK) iuiMl iuiSl apel itMSl trDcl wcBtrl laBtec cican cgi-8 epSD reHrr a4 conceSSion Zheisiang elsamex thailand vcSel
Associates
Key management personnel
157
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
b) transactions / balances with above mentioned related parties (mentioned in note 38 (ii) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives
Total
bALANCes: Advance towards capital in a subsidiary (Included in minority Interest) ilFS Advance Towards share application money made wcBtrl Current liabilities ilFS Investments in Covered Warrants ilFS option premium assets (Long-term loans and advances) ilFS (net of provision of ` 64.77 million) Interest Accrued (asset) ilFS apel others Interest accrued and not due on borrowings iSSl Inter-corporate deposits ilFS short-term lendings apel trDcl Long-term lendings apel trDcl a4 concession
150.00 150.00 28.73 28.73 648.00 648.00
-
616.91 616.91 -
-
150.00 150.00 616.91 616.91 28.73 28.73 648.00 648.00
136.43 136.43 5.66 5.66 270.00 270.00 -
34.94 34.94 -
319.13 12.15 331.28 610.99 50.00 660.99 474.60 171.80 640.71 1,287.11
-
136.43 136.43 5.66 319.13 12.15 336.94 34.94 34.94 270.00 270.00 610.99 50.00 660.99 474.60 171.80 640.71 1,287.11
158
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
b) transactions / balances with above mentioned related parties (mentioned in note 38 (ii) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives -
Total
Long-term borrowings ilFS
1,302.86 1,302.86 18.98 18.98 33.59 33.59 0.32 0.32 -
1,000.00 1,000.00 415.31 50.74 466.05 1.29 1.29 2.68 2.68 0.79 0.36 0.00 1.15
786.40 786.40 9.75 9.75 189.00 102.89 562.90 111.69 156.71 1,123.19 8.28 8.28 -
1,302.86 1,302.86 1,000.00 18.98 1,018.98 786.40 786.40 33.59 415.31 60.49 509.39 189.00 102.89 562.90 111.69 158.00 1,124.48 0.32 8.28 2.68 11.28 0.79 0.36 0.00 1.15
short-term borrowings iSSl ilFS Investments in Debentures apel
Trade payables ilFS iFin others Trade receivables wcBtrl trDcl a4 concession Zhesiang elsamex others Advances recoverable in Cash or Kind ilFS apel others secured Deposit ietS iel otHerS
Transactions Advance Towards share application money made ilFS wcBtrl
finance costs ilFS iFin others
30.00 30.00 3.36 3.36
632.84 13.07 645.91
616.91 616.91 -
-
30.00 616.91 646.91 3.36 632.84 13.07 649.27
159
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
b) transactions / balances with above mentioned related parties (mentioned in note 38 (ii) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives -
Total
Investments made / purchased ilFS Interest on Loans (expense) ilFS iSSl Inter-corporate deposits - matured ilFS Inter-corporate deposits - placed ilFS Lendings trDcl apel borrowings ilFS iSSl repayment of Lendings apel repayment of borrowings ilFS sale of Assets ilFS other Income ilFS apel others revenue from operations apel wcBtrl others
148.00 148.00 383.99 383.99 7,980.00 7,980.00 8,776.22 8,776.22 5,580.00 5,580.00 5,719.89 5,719.89 0.07 0.07 23.61 23.61 -
49.01 49.01 1,000.00 1,000.00 4.89 4.89 -
221.80 45.00 266.80 264.00 264.00 227.85 66.57 294.42 110.91 210.00 64.74 385.65
148.00 148.00 383.99 49.01 433.00 7,980.00 7,980.00 8,776.22 8,776.22 221.80 45.00 266.80 5,580.00 1,000.00 6,580.00 264.00 264.00 5,719.89 5,719.89 0.07 0.07 23.61 227.85 71.46 322.92 110.91 210.00 64.74 385.65
160
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
b) transactions / balances with above mentioned related parties (mentioned in note 38 (ii) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives 0.74 0.74
Total
Administrative and general expenses ilFS iFin others
202.78 202.78
69.62 66.27 135.89
-
202.78 69.62 67.01 339.41
Intangible assets under development ilFS iFin others
8.29 8.29
76.16 3.40 79.56
-
-
8.29 76.16 3.40 87.85
operating expenses ilFS iSSl others
22.71 22.71
0.03 0.39 0.42
-
-
22.71 0.03 0.39 23.13
refund of Advance Towards share application money trDcl
-
-
0.25 0.25
-
0.25 0.25
guarantee commission ilFS
15.29 15.29
-
-
-
15.29 15.29
Director remuneration Mr. K ramchand Mr. Mukund Sapre
-
-
-
36.85 21.48 58.33
36.85 21.48 58.33
Dividend paid ilFS
405.24 405.24
-
-
-
405.24 405.24
161
162
Notes
NOTE 39 : STATEMENT PURSUANT TO EXEMPTION REcEIvED UNDER SEcTION 212 (8) Of THE cOMPANIES AcT, 1956 RElATINg TO SUBSIDIARIES ANNEXURE III
SaFe Exchange Rate as at March 31, 2012 capital Reserve and Surplus Total Assets Total Revenue 7,186.54 4,219.66 3,680.76 2,081.45 282.92 911.48 2,682.43 8,422.43 7,870.13 13,552.50 18,015.93 14,784.94 12.94 5,764.81 5,993.25 5,484.78 10,358.99 2.22 472.26 62.90 64.84 8,677.10 296.58 8.21 5.09 80.26 81.96 11.88 (2.00) 333.87 (0.09) 2.92 5.66 9.85 19.43 0.11 200.93 109.71 40.03 18.88 1.79 146.40 188.16 84.62 3.31 269.33 5.59 97.38 4,989.81 4.78 (1.06) 142.50 (7.53) 13.70 (5.60) (59.48) 669.18 (145.73) 598.58 44.51 215.84 10.79 1,018.39 34.48 100.06 12.86 102.80 3.39 320.04 9.53 32.24 210.03 178.49 26.66 32.83 2.99 1.01 (10.64) 28.87 6.79 (1.21) 1.60 (1.32) 0.30 4.59 7,436.02 (0.37) 62.03 5.06 85.85 1,543.70 247.51 88.76 80.04 31.64 66.23 47.12 24.40 876.49 7.76 12.14 6.62 11.13 3.54 2.93 266.44 2.49 3,903.88 5.40 (2.26) 3.79 (1.65) (27.50) 10.05 (13.64) 4.15 10.79 4.38 1.13 2.98 0.14 (5.96) (5.19) 1.70 0.48 (0.38) 0.09 10,554.85 10.05 5,296.73 3,988.23 3,697.50 9,372.24 0.10 388.13 62.64 20.17 6,922.14 669.62 69.72 2.29 2,899.23 459.73 681.38 171.96 3,225.10 351.09 16.09 (150.30) (0.43) 343.70 (1.37) (0.24) (3.21) 217.26 0.71 151.46 35.37 124.45 0.98 452.36 1.58 308.27 136.59 226.64 (151.28) (0.43) (1.37) (0.24) (3.21) (1.06) 137.10 (5.27) 9.91 (3.95) (31.98) (155.78) 58.15 6.64 23.69 8.48 2.26 6.55 0.87 (4.68) 34.06 5.09 (1.21) 1.12 (0.94) 0.21 722.41 0.36 2,305.70 8,220.36 5,903.18 8,015.70 14,863.33 32.31 493.76 (189.66) 2.09 1.71 403.63 (168.76) 4,828.23 111.76 2,410.75 214.73 4,956.18 564.77 9,056.26 466.47 37.49 71.11 184.56 147.66 (189.66) 1.71 (168.76) 74.27 143.62 380.21 318.81 4,069.23 3,598.69 3,280.59 383.05 1,086.99 555.95 480.91 (20.81) 506.94 (384.51) 2,280.32 106.70 (321.02) (95.57) 13.53 876.97 74.76 (384.51) 93.17 Profit before taxation Provision for taxation Profit after taxation Proposed dividiend 1.00 1,265.42 1,851.89 1.00 293.10 327.87 1.00 400.00 0.17 1.00 1,680.00 18.40 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 3,720.00 510.09 1.00 0.50 2.39 1.00 163.77 304.31 1.00 593.91 1,411.11 1.00 1,451.04 336.24 51.16 1,340.15 (353.40) 51.16 2.61 (0.49) 1.00 85.50 (1.37) 1.00 0.50 (0.24) 1.00 49.00 (4.33) 1.00 3.16 (1.06) 68.34 1,384.89 2,147.25 68.34 0.21 (0.58) 68.34 68.34 68.34 68.34 68.34 68.34 68.34 1.00 1.00 4.05 4.05 68.34 68.34 68.34 68.34 68.34 4.05 68.34 68.34 0.20 4.10 37.62 6.83 0.06 68.55 36.13 25.46 3.26 (2.06) 118.92 22.47 1.93 977.99 238.84 23.92 51.26 21.18 22.37 38.66 (310.78) 0.91 52.70 22.16 (0.67) 40.32 8.46 8.90 4.10 47.02 50.20 0.96 (227.61) 158.90 (598.39) 1,038.76 (127.64) 400.00 (23.27) 0.50 201.57 1,600.00 366.95 2,216.60 3,320.20 2,451.40 701.20 Total liabilities (Other than shareholder's funds)
Sr. Name of Subsidiary No.
Report- country of ing currency incorporation
SoliD
transportation
SuStainaBle
1 2 3 4
Investments other than investment in subsidiary
5 6 7 8 9 10 11
forming part of the Consolidated Financial statements for the year ended March 31, 2012
that’s itnl for you
12 13 14 15 16 17 18 19 20 21
22 23 24
25 26 27
28 29 30 31 32 33 34
35
36 37 38 39 40
41
annual report 2011-12
42 43
inr india gujarat road and infrastructure company limited east Hyderabad expressway limited inr india itnl road infrastructure Development company limited inr india il&FS rail limited (Formerly known as itnl enso inr india rail Systems limited) vansh nimay infraprojects limited inr india Scheme of itnl road investment trust inr india west gujarat expressway limited inr india Hazaribagh ranchi expressway limited inr india pune Sholapur road Development company limited inr india Moradabad Bareilly expressway limited inr india Jharkhand road projects implementation inr india company limited chenani nashri tunnelway limited inr india Badarpur tollway operations Management limited inr india Mp Border checkpost Development company limited inr india north Karnataka expressway limited inr india rapid Metrorail gurgaon limited inr india itnl international pte. limited uSD Singapore itnl offshore pte. limited uSD Singapore Kiratpur ner chowk expressway limited inr india Karyavattom Sports Facilities limited inr india Futureage infrastructure india limited (Formerly inr india known as global parking plaza limited) charminar robopark limited inr india elsamex Sa euro Spain proyectos y promociones inmobilarias Sanchez euro Spain Marcos S l atenea Seguridad y Medio ambiente S.a. euro Spain Sanchez Marcos Si Sa euro Spain Senalizacion viales e imagen S.a.u. (SeviMagen) euro Spain S.a.u. elsamex internacional Srl euro Spain grusamar ingenieria y consulting Srl euro Spain elsamex portugal ingeniaría e Sg Sa euro portugal intevial gestao integral rodoviaria, S.a. euro portugal elsamex india private limited inr india yala construction co private limited inr india Mantenimiento and conservacion vialidades Sa pesosmeMexico (Mancovi) Mexico construction jicanos eSM Mantenimiento integral de Sa de cv pesosmeMexico jicanos centro De investigación elpidio Sánchez Marcos, S.a. euro Spain control 7, S.a euro Spain geotecnia 7 euro Spain grusamar albania SHpK euro albania area De Servicio coiros S.l. euro Spain conservacion De infraestructuras De Mexico S.a. pesosmeMexico De c.v. jicanos alcantarilla Fotovoltaica, S.l.u. euro Spain area De Servicio punta umbria, S.l.u. euro Spain
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS
Notice
notice is hereby given that the twelfth annual general Meeting of il&FS transportation networks limited will be held at y B chavan auditorium, gen. J. Bhosale Marg, Mumbai 400 021 on thursday, august 9, 2012 at 3.30 p.m. to transact the following business: (d) and all other applicable provisions, if any, of the companies act, 1956 (including any amendments thereto or re-enactment thereof), Foreign exchange Management act, 1999 including rules and regulations framed thereunder, and subject to any other approval, if required, consent of the company be and is hereby accorded to the Board of Directors or committee thereof to borrow by way of loan/ debentures (whether secured or unsecured)/bonds/ deposits for the purpose of the business of the company from the existing limit of ` 3,500 crores to ` 5,000 crores either in indian or Foreign currency from time to time from any bank(s) or any financial institution(s) or any other institution(s), firm(s), body corporate(s) or other person(s) or from any other source in india or outside india for the purpose of working capital requirements of the company, notwithstanding that the moneys to be borrowed together with the moneys already borrowed by the company (apart from temporary loans obtained from the company’s bankers in the ordinary course of business), will exceed the aggregate of the paid up capital of the company and its free reserves, that is to say, reserves not set apart for any specific purposes RESOlvED fURTHER THAT the Board of Directors of the company including any committee thereof be and are hereby authorized to do all such acts, deeds, as the Board may, in its absolute discretion, consider necessary, expedient or desirable including power to sub-delegate, in order to give effect to this resolution or as otherwise considered by the Board to be in the best interest of the company, as it may deem fit” (9) to consider and, if thought fit to pass with or without modification(s), the following resolution as an ordinary resolution: “RESOlvED THAT pursuant to the provisions of Section 293(1)(a) and all other applicable provisions, if any, of the companies act, 1956 (including any amendments thereto or re-enactment thereof), Foreign exchange Management act, 1999 including rules and regulations framed thereunder, and subject to any other approval, if required, consent of the company be and is hereby accorded to the Board of Directors or committee thereof to create, from time to time, such mortgages, charges and hypothecations, in addition to the mortgages/
ORDINARY BUSINESS:
(1) to receive, consider and adopt the Balance Sheet as at March 31, 2012 and the profit and loss account for the financial year ended on that date together with the reports of Directors and auditors thereon to declare a dividend to appoint a Director in place of Mr. Deepak Dasgupta, who retires by rotation and, being eligible offers himself for re-appointment to appoint a Director in place of Mr. Deepak Satwalekar, who retires by rotation and, being eligible offers himself for re-appointment to appoint a Director in place of Mr. vibhav Kapoor, who retires by rotation and, being eligible offers himself for re-appointment to appoint a Director in place of Mr. pradeep puri, who retires by rotation and, being eligible offers himself for re-appointment to appoint auditors and fix their remuneration and in this regard to consider and, if thought fit to pass with or without modification(s), the following resolution as an ordinary resolution: “RESOlvED THAT M/s. Deloitte Haskins & Sells, chartered accountants, Mumbai registered with the institute of chartered accountants of india vide Membership no. 117366w be and are hereby appointed as auditors of the company, to hold office from the conclusion of this Meeting until the conclusion of the next annual general Meeting on such remuneration as shall be fixed by the Board of Directors of the company”
(2) (3)
(4)
(5)
(6)
(7)
SPEcIAl BUSINESS:
(8) to consider and, if thought fit to pass with or without modification(s), the following resolution as an ordinary resolution: “RESOlvED THAT in supersession of the resolution passed at the annual general Meeting of the Members of the company held on august 5, 2011, and pursuant to the provisions of Section 293(1)
163
transportation
annual report 2011-12
charges/ hypothecation created/ to be created by the company, on such terms and conditions as the Board may deem fit on the whole or substantially the whole of the company’s undertakings and other properties, both present and/or future, whether movable or immovable comprised in any of the undertakings of the company as the case may be, in favour of banks and/or financial institutions, both national and international, and/or other bodies corporate or agencies as may be agreed to by the Board for the purpose of securing any issue of any debentures or loans or other financial assistance, by way of cash credit, overdraft, letter of credit and guarantee facilities and the like, whether in rupees or in foreign currency or currencies subject to a maximum limit of ` 5,000 crores (rupees Five thousand crores only) together with simple and/or compound interest thereon, commitment charges, management fees, service charges, premium on
redemption of debentures including any increase as a result of devaluation/evaluation/fluctuation in the rate of exchange of foreign currencies and all other costs, charges and expenses payable from time to time as per terms and conditions prescribed in any loan agreements or other deeds and documents entered into between the company and the said banks and / or financial institutions, both national and international, or bodies corporate and agencies” “RESOlvED fURTHER THAT the Board of Directors of the company including any committee thereof be and are hereby authorized to finalize and execute all agreements, deed, documents and other writings, as required, for creating mortgages, charges, and/or hypothecations and to do all such acts, as the Board may, in its absolute discretion, consider necessary, expedient or desirable including power to subdelegate, in order to give effect to this resolution” By order of the Board For il&FS transportation networks limited Krishna ghag associate vice president & company Secretary
Bengaluru, May 4, 2012 registered office: the il&FS Financial centre, c-22, g-Block, Bandra – Kurla complex, Bandra (east), Mumbai 400051
NOTES:
1. A MEMBER ENTITlED TO ATTEND AND vOTE AT THE MEETINg IS ENTITlED TO APPOINT A PROXY TO ATTEND AND vOTE INSTEAD Of HIMSElf, AND A PROXY NEED NOT BE A MEMBER Of THE cOMPANY. PROXIES IN ORDER TO BE EffEcTIvE MUST BE REcEIvED AT THE REgISTERED OffIcE Of THE cOMPANY NOT lESS THAN fORTY EIgHT HOURS BEfORE THE MEETINg an explanatory statement pursuant to Section 173(2) of the companies act, 1956, which sets out details relating to the Special Business, is annexed hereto as required under the listing agreement, the particulars of Directors seeking appointment/reappointment as Director are given in the annexure, is annexed hereto
4.
Members / proxies should bring the enclosed attendance slip duly filled in, for attending the Meeting, along with the annual report the register of Beneficial owners, register of Members and Share transfer Books of the company will remain closed from wednesday, august 1, 2012 to thursday, august 9, 2012 (both days inclusive) the Final Dividend as recommended by the Board of Directors, if approved by the Shareholders at their 12th annual general Meeting, shall be paid to those Members whose names appear on the register of Members of the company on thursday, august 9, 2012. in respect of shares held in electronic form, the Dividend will be payable to the Beneficial owners of the shares as on the closing hours of business on tuesday, July 31, 2012 as per the details furnished by Depositories for this purpose
5.
6.
2.
3.
164
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS
7.
Members are requested to immediately intimate changes, if any, in their registered addresses along with pin code number to the company or the registrar & Share transfer agents. Members holding shares in dematerialised mode are requested to intimate the same to their respective Depository participants in order to avail of the facility of electronic clearing Service (ecS), Members holding shares in physical form are requested to provide bank account details to the company or the registrar & Share transfer agents. Members holding shares in dematerialised mode are requested to instruct their respective Depository participants regarding bank accounts in which they wish to receive the dividends. the company/registrars & Share transfer agents will not act on any direct request received from Members holding shares in dematerialised form for change/deletion of such bank details the company is obliged to print such Bank details on the Dividend warrants as furnished by nSDl and cDSl, “the Depositories” to the company and the company cannot entertain any request for deletion/change of Bank details already printed on the Dividend warrant(s) based on the information received from the concerned Depositories without confirmation from them. in this regard Members are advised to contact their Depository participant (Dp) and furnish them the particulars of any change desired
12. Members are requested to bring their copy of the annual report to the Meeting Explanatory Statement Pursuant to Section 173(2) of the companies Act, 1956 Item No. 8 & 9 the Shareholders of the company, at the annual general Meeting held on august 5, 2011 authorised the Board of Directors for borrowing by way of loans, credit etc. upto a limit of ` 3,500 crores. as a result of the significant increase in the number and size of the projects that the company has been awarded there has been increase in the requirement of funds for investments in projects and for working capital support. the budgeted cash Flow for 2012-13 indicate a need for additional borrowings to provide for new investments, for repayment of existing loans and working capital, to facilitate which it is necessary to increase the approved borrowing limits. it is proposed that the borrowing limits of the company be increased by ` 1,500 crores from the present limit of ` 3,500 crores to ` 5,000 crores as per the provisions of Section 293(1)(a) and (d) of the companies act, 1956, the Board of Directors shall not, except with the consent of the shareholders in a general meeting, borrow moneys or create any charge by way of mortgage / hypothecation on any of the company’s properties and where moneys to be borrowed together with the moneys already borrowed by the company (apart from temporary loans obtained from the company’s bankers in the ordinary course of business) will exceed the aggregate of the paid up capital of the company and its free reserves, that is to say, reserves not set apart for any specific purpose the Board of Directors of your company recommends the ordinary resolutions set out at item no. 8 & 9 of the accompanying notice for approval of the Members none of the Directors of the company is in any way, concerned with or interested in this resolution
8.
9.
10. pursuant to the provisions of Section 205a of the companies act, 1956, the amount of dividend which remains unpaid /unclaimed for a period of 7 years would be transferred to the “investor education and protection Fund (iepF)”, constituted by the central government and Member(s) would not be able to claim any amount of dividend so transferred to the fund 11. Members intending to require information or clarifications about the Financial accounts, to be explained at the Meeting are requested to inform the company atleast a week in advance to enable the company to compile the information and provide replies at the Meeting
By order of the Board For il&FS transportation networks limited Krishna ghag associate vice president & company Secretary
Bengaluru, May 4, 2012 registered office: the il&FS Financial centre, c-22, g-Block, Bandra – Kurla complex, Bandra (east), Mumbai 400051
165
transportation
annual report 2011-12
Details of Directors seeking re-appointment at the annual general Meeting Particulars
Date of Birth Date of Appointment Qualifications
Deepak Dasgupta
16/12/1942 30/06/2009 Master’s degree in Science
Deepak Satwalekar
14/11/1948 30/06/2009 (i) Bachelor’s degree in technology from iiM, Mumbai Master’s degree in Business administration from the american university, washington Dc
vibhav Kapoor
16/07/1955 30/06/2009 Master of Business administration
Pradeep Puri
28/09/1956 6/1/2001 Master’s degree in History
(ii)
Expertise in specific functional areas
Has worked in various central govt departments related to infrastructure development & policy formulation • IJM (India) infrastructure limited C&C construction limited Road infrastructure Development company of rajasthan limited IL&FS Rail limited Rapid MetroRail gurgaon limited
Has considerable experience in the fields of finance, infrastructure and corporate governance
Has considerable experience in the fields of corporate finance and management of investments / treasury • • • • IL&FS Financial Services ltd IL&FS Investment Managers ltd IL&FS Securities Services ltd IL&FS Portfolio Management Services ltd
wide experience in handling infrastructure projects
Directorships in other Public limited companies*
• •
Asian Paints Limited National Stock exchange of india limited Infosys Limited Piramal Healthcare limited The Tata Power company limited
• • • • • •
North Karnataka expressway ltd Andhra Pradesh expressway limited West Gujarat Expressway ltd PDCOR Ltd Urban Mass Transit Co Ltd IL&FS Infrastructure Development corporation ltd IL&FS Urban Infrastructure Managers ltd Pipavav Railway corporation ltd ITNL Toll Management Services ltd North Karnataka expressway ltd - audit committee Andhra Pradesh expressway limited - audit committee West Gujarat Expressway ltd - audit committee Pipavav Railway corporation ltd - audit committee
•
• • •
•
• •
• • •
Membership of committees in other Public limited companies (includes only Audit & Shareholders’ / Investors’ grievance committee
•
C&C construction limited - investor grievance committee
•
Infosys Limited - audit committee - investor grievance committee
•
•
•
Road infrastructure Development company of rajasthan limited - audit committee
•
The Tata Power company limited - audit committe Piramal Healthcare limited - investor grievance committee
•
•
•
No. of Shares held in the company
79
-
3,14,800
31,652
*
excludes Directorships in private limited companies, Foreign companies and government bodies
166
SaFe
SoliD
SuStainaBle
that’s itnl for you
transportation
regd.office: the il&FS Financial centre,
c-22, g-Block, Bandra – Kurla complex, Bandra (east), Mumbai 400051
ATTENDANcE SlIP pleaSe Fill attenDance Slip anD HanD it over at tHe entrance oF tHe Meeting Hall
Dp .id* client id*
Folio no.
name and address of the Shareholder ..………………………………………………………................................................................ ......................................................................................................................................................................number of Shares held : ……………………………............. i hereby record my presence at the annual general Meeting of the company to be held on thursday, august 9, 2012 at 3.30
p.m., at y. B. chavan auditorium, gen. J. Bhosale Marg, Mumbai 400 021
*
applicable for investors holding Shares in electronic form Signature oF tHe SHareHolDer or proXy**
** Strike out whichever is not applicable
transportation
regd.office: the il&FS Financial centre,
c-22, g-Block, Bandra – Kurla complex, Bandra (east), Mumbai 400051
PROXY fORM
Dp .id* client id*
Folio no.
i/we …………………………………………………………………………………………………………..................................................... .............................................. being a Member/Members of il&FS transportation networks limited hereby appoint ………………………………………............. ................. ………………………………………………………….…………………………………………… of……............................................. or (failing him) ………………………………………………………………………………… of…………......................................... or (failing him) …………………………………………………………………………………… of………................................................... ......................................... as my/our proxy to attend and vote for me/us and on my/our behalf at the annual general Meeting of the company to be held on thursday, august 9, 2012 at 3.30 p.m. at y. B. chavan auditorium, gen. J. Bhosale Marg, Mumbai 400 021 and at any adjournment thereof Signed this ………………….day of …………………2012
Signature ……………..............................................
*applicable for investors holding shares in electronic form.
affix revenue stamp
………….........................
note : the proxy Form must be deposited at the registered office of the company at the il&FS Financial centre, c-22, g-Block, Bandra – Kurla complex, Bandra (east), Mumbai 400051 not less than 48 hours before the time for holding the meeting. the proxy need not be a member of the company
The IL&FS Financial Centre, Mumbai
IL&FS Transportation Networks Limited
The IL&FS Financial Centre Plot C22, G Block, Bandra Kurla Complex Bandra East, Mumbai 400 051 Tel.: 91-22-2653 3333 Fax: 91-22-2652-3979 www.itnlindia.com
doc_728461424.pdf
The report for the financial year 2011 - 2012 of IL&FS transportation networks limited(ITNL).
Annual Report 2011-12
That’s ITNL for you
safe solid sustainable
Contents
the annual general Meeting will be held at y. B. chavan auditorium, gen. J. Bhosale Marg, Mumbai 400 001 on Thursday, August 9, 2012 at 3.30 pm
02-19 corporate overview
Performance Highlights Operational Highlights Building a Resurgent India Portfolio of Road Projects Projects Under Operation Projects Under Construction Projects Under Development Urban Transportation Projects Largest Private Sector BOT Road Asset Portfolio 02 04 06 08 08 12 16 18 19
20-31 strategic review
Chairman’s Message Safe Solid Sustainable Board of Directors Awards and Accolades Corporate Information 20 22 24 26 28 30 31
32-58 statutory reports
Management Discussion and Analysis Directors’ Report Report on Corporate Governance 32 44 48
Forward-looking Statements In this Annual Report, we have disclosed forwardlooking information to enable investors to comprehend our prospects and take investment decisions. This report and other statements written and oral – that we periodically make contain forward-looking statements that set out anticipated results based on the management’s plans and assumptions. We have tried wherever possible to identify such statements by using words such as ‘anticipate’, ‘estimate’, ‘expects’, ‘projects’, ‘intends’, ‘plans’, ‘believes’, and words of similar substance in connection with any discussion of future performance We cannot guarantee that these forward-looking statements will be realised, although we believe we have been prudent in assumptions. The achievements of results are subject to risks, uncertainties, and even inaccurate assumptions. Should known or unknown risks or uncertainties materialise, or should underlying assumptions prove inaccurate, actual results could vary materially from those anticipated, estimated, or projected. Readers should keep this in mind. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise
59-162 Financials
Standalone Financial Statements Auditors’ Report Balance Sheet Statement of Profit and Loss Cash Flow Statement Notes Consolidated Financial Statements Auditors’ Report Balance Sheet Statement of Profit and Loss Cash Flow Statement Notes Notice/ Attendance Slip/ Proxy Form 59-104 59 62 63 64 66 105-162 105 108 109 110 112 163
Roads are the key to realizing the dream of a developed India, the means to usher in socio-economic development and to pave the way for India’s progress
At ITNL, we are committed towards our mission of building a resurgent India and providing technological excellence to challenging projects As we go about connecting the farthest corners of India and creating a solid foundation for the future, our endeavor is also to ensure high safety levels for our teams and for the road-users Being a catalyst to community development and ensuring long-term sustainability is also a prime concern Drawing strength from our legacy, parentage and track record, we continue to strive towards nation-building on a safe, solid and sustainable foundation
Transportation
ANNuAL RepoRT 2011-12
Performance Highlights
(Consolidated Financials)
Graphs not to scale
(` million)
Revenue
eaRnIngS PeR SHaRe
(`) 57,294
24,873
41,274
cagR
13,320
38.81%
1.42
2008-09
2009-10
2010-11
2011-12
2008-09
2009-10
19.97
2010-11
22.19
2011-12
(` million) 15,894
eBITDa
neT woRTH
(` million)
8,862.14
2008-09
2,900
28.85%
2009-10
2010-11
2011-12
2008-09
2009-10
16,686.36
cagR
2010-11
22,392.21
8,785
12,335
2011-12
PRoFIT aFTeR TaX
(` million)
DeBT-equITy RaTIo
4,970
3,444
4,329
2008-09
263
2009-10
2010-11
2011-12
2008-09
2.09
cagR
14.81%
2009-10
1.99
2010-11
2.44
2011-12
2
sAfe
soLID
susTAINABLe
That’s ITNL for you
3.74
27,637.90
25.48
02 | coRpoRATe oveRvIew performance Highlights
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
neT PRoFIT MaRgInS
(%)
DaIly aveRage collecTIon (GRoss)
(` million)
14
10.67
8.5
6.98
Toll Annuity 4.91
5.87
4.91
2008-09
2
2009-10
2010-11
4
2011-12
2008-09
3.08
2009-10
2010-11
4.91 2.35
8.7
2011-12
oPeRaTIng MaRgInS
(%)
InTeReST coveR
22
30
1.66
2.99
35
28
2008-09
2009-10
2010-11
2011-12
2008-09
2009-10
2010-11
2011-12
2.18
3
Transportation
ANNuAL RepoRT 2011-12
Operational Highlights
commissioned 460 lane kms under RIDcoR phase II project
obtained provisional completion certificate for 173 lane kms of Hyderabad outer Ring Road project
obtained concessions for:
four laning of Kiratpur to ner-chowk Section of nH-21 in the state of Himachal pradesh to be executed as BoT (Toll) on DBfoT pattern under NHDp phase III constructing New Bridges/structures, Repairing of existing Highway from Kharagpur to Baleshwar section in orissa and west Bengal Developing and operating of Sikar-Bikaner Section of nH-11 Bikaner Bypass in Rajasthan through public-private partnership Developing, Design, finance, construction, operation and Maintenance of Mathura (u.P. Border) to Bhadoti in the state of Rajasthan Developing, Design, finance, construction, operation and Maintenance of Rawatsar-nowar-Bhadra roads in the state of Rajasthan Developing the existing Two Lane road to a Four lane road on Beawar gomti section of nH - 8 in the state of Rajasthan Improvement works of chaibasa-Kandra-chowk Road and adityapur - Kandra Road under the Jharkhand Accelerated Road Development programme
4
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew operational Highlights
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Acquired 61.22% equity stake in futureage Infrastructure India Limited for executing an automated car parking project of 440 car spaces in Hyderabad through charminar Robo park Limited, a subsidiary of the company
Acquired 49% equity stake in chongqing yuHe expressway company limited (through ITNL International pte. Ltd., singapore, a wholly owned subsidiary), a company based in china which has concession rights for a road project comprising 58.72 kms of 4-lane carriage way having bridges and tunnels as a part of its carriageway
obtained ISo 14001:2004 and oHSaS 18001:2007 certifications for environmental, Health and safety Management system
5
Transportation
ANNuAL RepoRT 2011-12
Building a Resurgent India
11,859 lane kms
RoaD aSSeTS PoRTFolIo
5,453 lane kms
oPeRaTIonal PoRTFolIo
Chenani - Nashri Tunnel project
IL&fs Transportation Networks Limited (ITNL) is a leading surface transportation infrastructure company and one of the largest BoT road operators, with the illustrious parentage of Infrastructure Leasing & financial services Limited (IL&fs) ITNL is involved in the development, operations and maintenance of surface transportation infrastructure projects encompassing national and state highways, roads, flyovers and bridges. ITNL has established a diverse project portfolio in the BoT road segment and made successful inroads in non-road sectors like metro rail, bus transportation and border entry points ITNL has set up an international multi-segment footprint spanning road, urban infrastructure and railways sectors ITNL has promoted and developed a large portfolio of road sector projects with a significant developmental role. ITNL will build upon its reputation for on-time project delivery within the budgeted cost and transform the face of the surface transportation infrastructure in the country through better engineering, monitoring and use of latest technology
ISO 9001:2008, ISO 14001:2004 and OHSAS 18001:2007
ceRTIFIeD
EnroutE to SuccESS
A sharply focused and strategised business model positions ITNL to seize the benefits of a robust momentum in NHAI road projects. Besides a diverse portfolio in BOT road segment, ITNL has expanded into new sub-sectors in surface transportation such as urban transportation, railways, border checkposts, parking complexes, with a vision to transform India’s surface transportation infrastructure
6
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew Building a Resurgent India
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
8, 69 9
3, 16 0
PoRTFolIo MIX (lane kms)
Annuity Toll Annuity projects form 27% of asset base
PoRTFolIo MIX (` million)
Annuity Toll
12 5, 07 4
7, 15 0
17 7, 08 0
PoRTFolIo MIX (lane kms)
National Highways Other Roads National Highways account for 40% of asset base
PoRTFolIo MIX (` million)
National Highways Other Roads
Pan InDIa PReSence
1. 2. 3. 4. 6. 8. 11. 16. 5. 7. 13. 12. 14. 15.
1. Jammu & Kashmir 2. Himachal pradesh 3. Haryana 4. Rajasthan 5. uttar pradesh 6. Gujarat 7. Madhya pradesh 8. Maharashtra
15 7, 58 3
4, 70 9
14 4, 57 1
9. Karnataka 10. Kerala 11. Andhra pradesh 12. orissa 13. Jharkhand 14. west Bengal 15. Meghalaya 16. Assam 1. usA 2. Mexico 10. Brazil 11. portugal 12. spain 13. Albania 14. Moldova 15. china 16. India 17. Thailand 3. Honduras 4. Haiti 5. The Dominican Republic 6. panama
17.
9.
10.
InTeRnaTIonal FooTPRInT
1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
14. 12. 11. 13. 16. 15.
7. columbia 8. ecuador 9. Argentina
7
Transportation
ANNuAL RepoRT 2011-12
Portfolio of Road Projects
An Ensemble of our Road Projects
projEctS undEr opEration
North Karnataka Expressway Limited
Belgaum Maharashtra Border Road
West Gujarat Expressway Limited
Jetpur Rajkot Gondal Road
Scope
Development of four lanes with service roads on both sides aggregating to approximately 472 lane kms in length between Belgaum in the state of Karnataka up to Maharashtra Border
Scope
widening of the existing Jetpur–Gondal road from two lanes to four lanes, the improvement of the existing four lanes between Gondal and Rajkot, the widening of the existing Rajkot bypass from two lanes to four lanes on the National Highway 8B and construction of service roads, with an aggregate length of approximately 389 lane kms in the state of Gujarat
concession
The concession was awarded by the NHAI on a BoT (Annuity) basis for a period of 17.5 years (including a construction period of two and a half years)
concession
The concession awarded by the NHAI on a BoT (toll) basis for a period of 20 years (including a construction period of two and a half years)
Date of Concession Agreement
November 20, 2001
Date of Project Completion
July 19, 2004
Date of Concession Agreement
March 22, 2005
Date of Project Completion
March 17, 2008
Value (` million)
5,995
Value (` million)
2,762
8
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
NoIDA Toll Bridge Company Limited
Delhi to NoIDA, uttar pradesh
Gujarat Road and Infrastructure Company Limited
vadodra-Halol Road *
Gujarat Road and Infrastructure Company Limited
Ahmedabad-Mehsana Road
Scope
Development of a toll bridge and approach roads with approximately 60 lane kms connecting Delhi to NoIDA in the state of uttar pradesh
Scope
Development of an approximately 190 lane kms on state Highway No. 87 from vadodara to Halol in the state of Gujarat
Scope
Development of an approximately 333 lane kms section of state Highway Numbers 41 and 133 from Ahmedabad to Mehsana in the state of Gujarat
concession
The concession awarded to our promoter by the New okhla Industrial Development Authority (“NoIDA”) on a BoT (Toll) basis for a period of 30 years (including a construction period of two and a half years
concession
The concession awarded to our promoter by the Government of Gujarat on a BooT (Toll) basis, which commenced from the date of signing of concession Agreement and shall extend till a period of 30 years from the operations date
concession
The concession awarded to our promoter by the Government of Gujarat on a BooT (Toll) basis, which commenced from the date of concession Agreement and shall extend for a period of 30 years from the operations date
Date of Concession Agreement
November 12, 1997
Date of Concession Agreement
october 17, 1998
Date of Concession Agreement
May 12, 1999
Date of Project Completion
february 7, 2001
Date of Project Completion
october 24, 2000
Date of Project Completion
february 20, 2003
Value (` million)
5,888
Value (` million)
1,553
Value (` million)
3,037
* This project was designated by the world Bank as a best practices example for its environment risk mitigation and social rehabilitation plan
9
Transportation
ANNuAL RepoRT 2011-12
PRojecTS unDeR oPeRaTIon
Thiruvananthapuram Road Development Company Limited
Thiruvananthapuram city Roads phase I
Andhra Pradesh Expressway Limited
Kotakatta - Kurnool Road
Rajasthan Infrastructure Development Company of Rajasthan Limited
Mega Highways project, Rajasthan phase I
Scope Scope
Development of roads with an aggregate length of approximately 51 lane kms in Thiruvananthapuram city in the state of Kerala Development of 328 lane kms connecting Kotakatta bypass to Kurnool on National Highway-7 in the state of Andhra pradesh
Scope
Development of two lane highway with paved shoulder aggregate length of 2,106 lane kms and the improvement of four corridors, connecting phalodi to Ramji-ki-Gol, Hanumangarh to Kishangarh, Alwar to sikandra, Lalsot to Kota, and Baran to Jhalwar in the state of Rajasthan
concession concession
concession awarded by the Kerala Road fund Board on a BoT (Annuity) basis for a period of 17.5 years (including an initial construction period of two and a half years) concession awarded by the NHAI on a BoT (Annuity) basis for a period of 20 years (including a construction period of two and a half years)
Date of Concession Agreement
March 20, 2006
concession
concession awarded to promoter by the Government of Rajasthan on a ppp (Toll) basis for a period of 32 years (including a construction period of two years)
Date of Concession Agreement
March 16, 2004
Date of Project Completion
september 30, 2009
Date of Project Completion
November 15, 2006
Date of Concession Agreement Value (` million)
8,710 January 17, 2006
Date of Project Completion
March 31, 2009
Value (` million)
1,116
Value (` million)
16,180
10
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Rajasthan Infrastructure Development Company of Rajasthan Limited
Mega Highways project, Rajasthan phase II
ITNL Road Infrastructure Development Company Limited
Beawar Gomti Road
East Hyderabad Expressway Limited
Hyderabad outer Ring Road
Scope Scope
Development of a two-lane highway for an aggregate length of 715 lane kms. out of which 460 lane kms have been completed for Alwar to Bhiwadi (AB), Arjunsar to pallu (Ap), Hanumangarh to sangaria (Hs) in the state of Rajasthan
Scope
Development of two lanes with an aggregate length of approximately 248 lane kms with an option to construct a four lane highway on the Beawar Gomti Highway connecting Beawar to Gomti in the state of Rajasthan
Development of eight lane access controlled expressway with an aggregate length of 173 lane kms for the section from pedda Amberpet to Bongulur in the state of Andhra pradesh
concession concession
concession awarded to promoter by the Government of Rajasthan on a ppp (Toll) basis for a period of 32 years (including a construction period of two years)
concession
concession awarded by the Department of Road Transport & Highways, Government of India, on a DBfoT (Toll) basis for an initial period of 11 years which is further extendable to 30 years in case the company exercises the option to construct a four lane highway on the stretch within seven years from the appointed date
The concession was awarded by Hyderabad urban Development Authority for a period of 15 years (including construction period of 30 months)
Date of Concession Agreement
August 3, 2007
Date of Award
february 8, 2011 september 1, 2010 April 6, 2011
Date of Project Completion
March 1, 2011
Date of Concession Agreement
April 1, 2009
Date of Project Completion
Hs - october 1, 2011 AB - December 5, 2011 Ap - January 31, 2012
Date of Project Completion
August 25, 2010
Value (` million)
4,721
Value (` million)
4,322
Value (` million)
3,510 11
Transportation
ANNuAL RepoRT 2011-12
projEctS undEr conStruction
Thiruvananthapuram Road Development Company Limited
Thiruvananthapuram city Roads (phase II and phase III)
Hazaribagh Ranchi Expressway Limited
Hazaribagh - Ranchi Road
Scope Scope
Development of roads with an aggregate length of approximately 107 lane kms in Thiruvananthapuram city in the state of Kerala in three phases - phase I, phase II and phase III Development of four lanes with an aggregate length of approximately 319 lane kms connecting Hazaribagh to Ranchi in the state of Jharkhand
concession concession
The concession for phases II and III of this project was awarded by the Kerala Road fund Board on a BoT (Annuity) basis for a period of 17.5 years (including an initial construction period of two and a half years) concession awarded by NHAI on a BoT (Annuity) basis for a period of 18 years including an initial construction period of two and a half years
Date of Concession Agreement
october 8, 2009
Date of Concession Agreement
May 1, 2009
Value (` million)
8,692
Value (` million)
2,626
12
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Pune solapur Road Development Company Limited
pune - solapur Road
Warora Chandrapur Ballarpur Toll Road Company Limited
chandrapur - warora Road
Jharkhand Road Projects Implementation Company Limited
Jharkhand Accelerated Road
Scope Scope
Development of four lanes with an aggregate length of approximately 571 lane kms on pune – solapur stretch of National Highway-9 in the state of Maharashtra Development of four lanes with an aggregate length of approximately 275 lane kms connecting warora to chandrapur to Bamni in the state of Maharashtra
Scope
Development of two lane and four lane with an aggregate length of approximately 664 lane kms connecting Ranchi Ring Road (RRR), Ranchi patratu Ramgarh (RpR), Adityapur-Kandra (AK) (four-laning) and chaibasa – Kandra – chowka (cKc) in the state of Jharkhand
concession concession
concession awarded by NHAI on a DBfoT (Toll) basis for a period of 20 years, including an initial construction period of 2.5 years concession awarded by the pwD, Government of Maharashtra on a DBfoT (Toll) basis for a period of 30 years, including an initial construction period of 3 years
concession
concession awarded by the Government of Jharkhand on a BoT (Annuity) basis for a period of 17.5 years (including construction period of 3 years)
Date of Concession Agreement
september 30, 2009
Date of Concession Agreement
March 18, 2010
Date of Concession Agreement
RRR – september 23, 2009 RpR I & II – october 14, 2009 cKc – May 28, 2011; AK – August 6, 2011
Value (` million)
14,027
Value (` million)
6,886
Value (` million)
21,347 13
Transportation
ANNuAL RepoRT 2011-12
PRojecTS unDeR conSTRucTIon
Rajasthan Infrastructure Development Company of Rajasthan Limited
Mega Highway project phase II, Rajasthan
N.A.M. Expressway Limited
Narketpalli Addanki Medarametla Road
Moradabad Bareilly Expressway Limited
Moradabad Bareilly Road
Scope Scope
Development of a two-lane highway for an aggregate length of 715 lane kms. out of which 460 lane kms have been completed and 255 lane kms are under construction for stretches Jhalawar to Jhalawar Road, Jhalawar to ujjain, Kapren to Mangrol, Khushkheda to Kasola chowk in the state of Rajasthan widening of an existing twolane carriageway to a four-lane carriageway, including the strengthening of existing carriageway by providing bituminous overlays with an aggregate length of approximately 888 lane kms from Narketpalli to Medarametla near Addanki section of sH-2 in the state of Andhra pradesh
Scope
Development of four lane of Moradabad Bareilly section of NH-24 from kms 148.00 to kms 262.000 (approx. length 522 lane kms) in the state of uttar pradesh
concession concession
concession awarded by NHAI on DBfoT (Toll) basis for a period of 25 years including an initial construction period of two and half years
concession
concession awarded on ppp (Toll) basis for a period of 32 years, including a construction period of two years
The concession for this project has been awarded by Roads & Building Department, Government of Andhra pradesh under ppp on BoT (Toll) basis for a concession period of 24 years, including an initial construction period of two and a half years
Date of Concession Agreement
february 19, 2010
Date of Award
December 21, 2009 March 30, 2010 february 1, 2011
Date of Concession Agreement
July 23, 2010
Value (` million)
19,836
Value (` million)
17,605
Value (` million)
3,798
14
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Jorabat shillong Expressway Limited
Jorabat shillong Road
Chenani Nashri Tunnelway Limited
chenani Nashri Tunnel
MP Border Checkpost Development Company Limited
24 Border checkpost
Scope
Development of four lane of Jorabatshillong (Barapani) section of NH40 from km 0.000 to km 61.800 (approximately 262 lane kms) in the state of Assam & Meghalaya
Scope
Development of four lane of chenani to Nashri section of NH-1A from km 89+00 to km 130+00 (New Alignment) of NH-1A including 9 km long tunnel (2 - Lane) with parallel escape tunnel (approximately 38 lane kms) in the state of Jammu and Kashmir
Scope
construction, up-gradation, Modernisation, Development, operation and Maintenance of 24 Border check posts across the state of Madhya pradesh
concession
concession awarded by NHAI on a DBfoT pattern under sARDp-Ne on Annuity Basis for a period of 20 years including an initial construction period of three years
concession concession
concession awarded by NHAI on DBfoT (Annuity) basis for a period of 20 years including an initial construction period of five years concession awarded by MpRDc on a BoT (user fee basis) for a period of 4,566 days including an initial construction period of 730 days
Date of Concession Agreement
July 16, 2010
Date of Concession Agreement
November 10, 2010
Date of Concession Agreement
June 28, 2010
Value (` million)
8,240
Value (` million) Value (` million)
37,200 13,500
15
Transportation
ANNuAL RepoRT 2011-12
projEctS undEr dEvElopmEnt
Kiratpur Ner Chowk Expressway Limited
Kiratpur Ner chowk Road
sikar-Bikaner Highway Limited
sikar-Bikaner Road
Jharkhand Road Projects Implementation Company Limited
Jharkhand Accelerated Road
Scope
Development of four Laning of Kiratpur to Ner-chowk section of NH-21 from km 73.200 to km 186.500 (approximately 327 lane kms) in the state of Himachal pradesh
Scope
Development and operation of sikarBikaner section from km 340.188 of NH-11 to km 557.775 of NH-11 via sikar Bypass and Bikaner Bypass from km 553.869 of NH-11 to km 267.325 of NH-89 (approximately 540 lane kms) by Two Laning with paved shoulder in the state of Rajasthan
Scope
Development of two lanes and four lane with an aggregate length of approximately 338 lane kms for various road stretches in the state of Jharkhand
concession
The concession for this project has been awarded by NHAI on a DBfoT (Toll) basis for a period of 28 years including an initial construction period of three years
concession concession
The concession for this project has been awarded by pwD Rajasthan on a DBfoT (Toll) basis for a period of 25 years including construction period of 2 years concession awarded by the Government of Jharkhand on a BoT (Annuity) basis for a period of 17.5 years (including construction period of 3 years)
Date of Concession Agreement
March 16, 2012
Date of Award
March 31, 2012
Value (` million)
15,842
Value (` million)
22,910
Value (` million)
7,100 16
sAfe soLID susTAINABLe That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Baleshwar Kharagpur Expressway Limited
Baleshwar Kharagpur Road
ITNL Road Infrastructure Development Company Limited (Four-laning)
Beawar – Gomti Road
Road Infrastructure Development Company of Rajasthan Limited
Mega Highways project phase III, Rajasthan
Scope
construction of New Bridges/ structures, Repair of existing four Lane Highway from Kharagpur to Baleshwar section of NH-60 from km 0.000 to km 119.300 (approximately 477 lane kms) in the state of orissa and west Bengal and its operation and Maintenance
Scope
Development and operation of fourlaning of the Beawar – Gomti section of National Highway No. 8 from km 58+245 to km 166+050 (approximately 216 lane kms) in the state of Rajasthan
Scope
Development of two lane highway with an aggregate length of 607 lane kms and includes the improvement of two corridors, connecting Mathura (u.p Border) to Bhadoti and Rawatsar. Nohar-Bhadra upto Haryana Border in the state of Rajasthan
concession concession
The concession for this project has been awarded by NHAI on a DBfoT (Toll) basis for a period of 24 years including construction period of 2.5 years The concession awarded by Department of Road Transport & Highways, Government of India, on a DBfoT (Toll) basis for two-laning of the project for an initial period of 11 years is extended to 30 years as concessionaire has been notified for undertaking four laning for the project
concession
concession awarded on ppp (Toll) basis for a period of 32 years, including a construction period of two years
Date of Concession Agreement
April 24, 2012
Date of Concession Agreement
April 1, 2009
Date of Award
february 22, 2012
Value (` million)
6,600
Value (` million)
12,000
Value (` million)
6,315
17
Transportation
ANNuAL RepoRT 2011-12
urban tranSportation projEctS
Vansh Nimay Infra Projects Limited
Nagpur city Bus project
Rapid MetroRail Gurgaon Limited
Gurgaon Metro Rail Link
Charminar Robo Park Limited
car parking project, charminar, Hyderabad
Scope
Mobilisation, operation and maintenance of the Nagpur city bus services in the city of Nagpur on Boo basis
Scope
Development of a approximately 4.9 km long track for an, elevated metro line on a concession basis connecting the Delhi Metro sikanderpur station on MG Road to NH-8 in Gurgaon in the state of Haryana
Scope
Development of multilevel car park in the city of Hyderabad in the state of Andhra pradesh
concession concession
concession awarded by Nagpur Municipal corporation to vansh Nimay Infra projects Limited for a period of 10 years (and renewable for another five years)
concession
concession for the project has been awarded to us by Haryana urban Development Authority for a period of 99 years, including an initial construction period of two and a half years
The concession for this project has been awarded by Greater Hyderabad Municipal corporation (GHMc) on BoT basis for a concession period of 30 years, including an initial construction period of two years
Date of Concession Agreement
february 9, 2007
Date of Concession Agreement
May 25, 2012
Date of Concession Agreement
December 9, 2009
Value (` million)
709
Value (` million)
500
Value (` million)
11,000 18
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew portfolio of Road projects – A snapshot
20 | sTRATeGIc RevIew
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Largest Private Sector BOT Road Asset Portfolio
Fair mix of “annuity / assured payments” and “Toll” based projects in various stages of development
Commissioned
190 1,553 60 5,888 333 3,037 472 5,995 51 1,116 389 2,762 2,106 16,180 328 8,710 vadodara Halol 173 4,721 248 3,510 152 3,994 256 6,591 235 22,750 107 2,626 460 3,798 Hyderabad outer Ring Road
Length in lane kms project cost in ` Mn
noida Toll Bridge
Beawar gomti
ahmedabad Mehsana Road
Ramky elsamex Hyderabad Ring Road
north Karnataka expressway
a-4 autovia, Spain
Thiruvananthapuram city Roads - I
yuHe expressway, china
west gujarat expressway
Thiruvananthapuram city Roads - II
RIDcoR - I
RIDcoR - II
aP expressway
Under Construction/ Development
664 21,347 319 8,692 522 19,836 888 17,605 571 14,027 262 8,240 275 6,886 jharkhand Road Development 38 37,200 327 22,910 477 6,600 540 7,100 255 3,798 607 6,315 216 12,000 chenani nashri
Length in lane kms project cost in ` Mn
Ranchi Hazaribagh
Kiratpur ner chowk
Moradabad Bareilly
Baleshwar Kharagpur
narketpalli addanki
Sikar Bikaner
Pune Solapur
RIDcoR II
jorabat Shillong
RIDcoR III
warora chandrapur
Beawar gomti II
Graphs not to scale
19
Transportation
ANNuAL RepoRT 2011-12
Being at the fulcrum of a growth curve in India’s infrastructure industry and having achieved the largest road asset portfolio, we move ahead with renewed vigour, with a vision to build a safe, solid and sustainable India
Chairman’s Message
Dear Friends,
The year 2011-12 was fairly eventful as far as our business performance was concerned. The unstinted support of our stakeholders enabled us to achieve our targets. Being at the fulcrum of a growth curve in India’s infrastructure industry and having achieved the largest road asset portfolio, we move ahead with renewed vigour, with a vision to build a safe, solid and sustainable India The overall macro-economic challenges combined with the sluggish growth of India’s economy remain a matter of concern. However, our determination to maintain momentum helped us emerge stronger and we move forward with a vision to transform India’s surface transportation infrastructure targeted an investment of ` 41 trillion towards this segment and there is a coherent action to accelerate spending in this sector
last mile connectivity
Although India has a massive road network, the quality of roads needs significant improvement. The shortage of rail wagons and lack of last mile connectivity has contributed to roads becoming the preferred mode of transport for goods and services The government’s focus on inclusive development and emphasis on private sector participation for infrastructure development are clearly demonstrated by the steady escalation in road infrastructure projects The Government has been actively focusing on development in road infrastructure through its National Highways Development programme (NHDp) launched by the National Highways Authority of India (NHAI). Two phases of the NHDp are on the verge of completion, while upcoming projects will be awarded for phases III to vII, which together have the potential of developing approximately 33,000 kms of roads
Infrastructure: a key priority
Deepak Dasgupta Chairman Infrastructure has emerged as the backbone of India’s economy and has the ability to make the nation one of the world’s most influential economies by 2050. Therefore, India’s XIIth five year plan reinforces the government’s focus on infrastructure creation and upgradation by having
20
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew chairman’s Message
32 | sTATuToRy RepoRTs
59 | fINANcIALs
Managing and upgrading school infrastructure and holistic empowerment of project-affiliated communities through vocational training is what we plan to achieve. our unique concept ‘computer on wheels’ received an over-whelming response from these communities and contributed immensely towards enhancing their computer knowledge and skills
year ahead
Today, we have attained a position where we can confidently say that we have successfully laid a strong foundation for a sustainable future. our expertise in project development and execution combined with our in house self sufficiency and technical skills in the areas of structures, design and operations and maintenance continues to drive business expansion. It also gives us the confidence to achieve our targets and sustain growth I am sincerely grateful to our stakeholders for trusting our capabilities and also to my colleagues on the Board and our employees for their dedication and commitment. I look forward to their continued support and trust in all our future endeavours Best wishes, Deepak Dasgupta Chairman
within ITnl
our consolidated revenues increased 39% and our net profit 15% over the previous year despite adverse market conditions and increased competition, with a majority of this contribution emanating from construction, toll and annuity. During the year, we commissioned 633 lane kilometres, taking the total lane kilometres under operation to 5,453 lane kilometres It is pertinent to mention here that we have created a strong portfolio of road development projects and we remain committed to our vision of transforming India’s surface transportation infrastructure. our bidding criteria are perfectly aligned with our objective of achieving threshold IRRs, rather than merely building on the order book
deepen long-term linkages to ensure sustainability. we focus on maintaining high levels and standards of safety at our operational sites and ensuring accident-free working conditions for our people as well as the users
Road ahead
we continue to draw immense strength from our large order pipeline. we envisage the nature of bidding to get more rational, which will augur well for the business of your company. we are confident of continuing to win more projects on bids submitted to the NHAI and to some state Governments. we also propose to increase our international presence selectively, but our focus shall remain Road centric and India centric
Key strategy
our financial credibility and technical expertise has strengthened our bidding capacity and helped us expand our operations in into other sectors besides roads. we continue to leverage our technological competence, value engineering, financial competence and innovative design capabilities to maintain our leadership position our aim is to catalyse substantial community development in the hinterland of our projects and
Beyond roads
During the year, we continued with our community development initiatives through our project Parivartan. our main focus here continues to be education.
Our expertise in project development and execution combined with our in house self sufficiency and technical skills in the areas of structures, design and operations and maintenance continues to drive business expansion
21
Transportation
ANNuAL RepoRT 2011-12
SaFe
At ITNL, we believe the route to safety is towards maintaining high levels and standards of safety at both construction and operational sites which is achieved through safety audits. This is done by ensuring accident-free working conditions for the project teams and users of the road. stringent measures are undertaken to identify and prevent accidents through safety audits
22
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew sAfe
32 | sTATuToRy RepoRTs
59 | fINANcIALs
ITNL believes in addressing occupational safety and health needs during the implementation process and works on comprehensive safety programs to make project sites safer places to work. ITNL aims to prevent work-related hazards and risks associated with construction to avoid fatalities Besides, we ensure a proper usage of personal protective equipments (ppe) to eliminate injuries from unpredicted hazards
SAFE SITE
A Periodical on “safety in Construction” - an initiative by ITNL
safety is a state of mind - Accidents are absence of mind
23
Transportation
ANNuAL RepoRT 2011-12
SolID
At ITNL, we believe the road to solidity is to deliver projects with technological and engineering excellence within the budgeted time and cost. ITNL’s technological capability, value engineering and its excellence in design engineering have been instrumental in maintaining a leadership position. Besides strengthening bidding, project management and execution capability, all these efforts have helped ITNL in expanding its operations in other areas of surface transportation infrastructure
24
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew soLID
32 | sTATuToRy RepoRTs
59 | fINANcIALs
ITNL’s vision of transforming India’s surface transportation infrastructure gains strength from the technology, experienced management and project diversity which have enhanced ITNL’s credibility as a dependable industry player construction at the 9-km long chenani-Nashri tunnel, India’s longest road tunnel project is ongoing. construction of this tunnel has been particularly challenging owing to steep mountainous terrain, bad weather conditions and safety concerns. The project has used advanced tunnelling and drilling equipments and a new Austrian Tunnelling method to sequentially excavate and support the tunnel completion of this project will be of great significance for ITNL, as it will be one of the landmark projects in ITNL’s history
25
Transportation
ANNuAL RepoRT 2011-12
SuSTaInaBle
At ITNL, we believe the road to sustainability is the development of social infrastructure. Development of transportation infrastructure is imperative for the growth of the nation, but such development needs to be balanced and sustainable from a social perspective as well
ITNL strives to catalyse substantial community development and ensure sustainability through education, employability and empowerment. ITNL believes that with quality resources, rural India will have more reason to smile. ITNL believes that education, employment generation and basic health facilities are the key transformational tools to catalyse substantial community development and deepen long-term linkages to ensure sustainability
26
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew susTAINABLe
32 | sTATuToRy RepoRTs
59 | fINANcIALs
ITNL’s unique initiative “Parivartan” focuses on efforts of improvement of education, skill development and health initiatives for communities residing close to our areas of operations to pave way for social empowerment. The move is aimed towards enhancing India’s socioeconomic prosperity and building capabilities to develop alternative means of livelihood, enhance employability and explore other possibilities ITNL has collaborated with IL&fs education & Technology services Limited for rehabilitation of communities along the National Highways of pune-solapur in Maharashtra, RanchiHazaribagh in Jharkhand, Moradabad-Bareilly in uttar pradesh and chenani-Nashri in Jammu & Kashmir Key highlights of this initiative are:
Reaching out to government schools and educational institutions at project sites, building capacities for intake of more students and teachers; and upgrading teaching methodologies and techniques Imparting mobile computer education and other IT-based trainings through parivartan computer Bus at schools and other locations along project roads undertaking school management programs aimed at improvement of schools infrastructure and training for teachers and students setting up skill development centers to train youth for employment opportunities organising health checkup camps and mobilizing mobile health van with medicos for routine checkup and basic treatment for remote villages
27
Transportation
ANNuAL RepoRT 2011-12
Board of Directors
Deepak Dasgupta
Chairman & Independent Director
Retired Indian Administrative services officer served the Government of Haryana and the central Government for over 35 years Headed various departments in the Government of Haryana and Government of India, including those related to infrastructure development and policy formulation served as the chairman of National Highways Authority of India for over five years and as an Advisor to the Asian Development Bank Member of the senior expert committee of IDfc private equity fund and the special Task force in Bihar Holds a Master’s degree in science from Delhi university developed the prestigious ‘Mumbaipune expressway’ project); and also as vice-chairman & Managing Director of Maharashtra Airport Development company Limited Holds a Bachelor’s degree in Law, Master’s degree in economics from Lucknow university and a post graduation in ‘urban Development’ from the London university
H P jamdar
Independent Director
Headed various departments of the Government of Gujarat, including as secretary and principal secretary; during his tenure, Mr. Jamdar was appointed as chairman of various state-owned corporations, especially in roads and ports sector served as the president of Indian Roads congress and the Institution of engineers (India) and as the vicepresident of ‘fIescA’
Deepak Satwalekar
Independent Director
former Managing Director and chief executive officer of HDfc standard Life Insurance company Limited; prior to this, he was the Managing Director of HDfc Limited since 1993 consultant with multi-lateral and bilateral agencies Recipient of the ‘Distinguished Alumnus Award’ from the Indian Institute of Technology, Mumbai, and is now on the Advisory council of the said Institution Also an Independent Director on the Boards of several other companies currently active on the Board of Trustees of Isha vidhya (ishavidhya. org) and Teach to Lead (teachforindia. org), engaged in the field of primary education for low income and socially disadvantaged members of the society in rural and urban India, respectively Also advising a company engaged in establishing a network of Bpo companies in rural areas across the country Holds a Bachelor’s degree in Technology from the Indian Institute of Technology, Mumbai, and a Master’s degree in Business Administration from the American university, washington Dc
Holds a Bachelor’s degree in civil engineering from the Gujarat university
Ravi Parthasarathy
Non-Executive Director
Associated with the company since January 6, 2001 and with the IL&fs Group since 1988 presently the chairman of IL&fs Group prior to joining the IL&fs Group, he served 20th century finance corporation Limited, a financial services company, as its executive Director Holds a Bachelor’s degree in science from the university of Mumbai and a post-graduate diploma in Business Administration from the Indian Institute of Management, Ahmedabad
R c Sinha
Independent Director
Retired Indian Administrative services officer; worked in various capacities in the Government of Maharashtra and Government of India Headed various departments / worked in ministries of the Government of Maharashtra, including as collector, District Magistrate, secretary and Additional chief secretary served as the Joint secretary, Ministry of Information & Broadcasting, Government of India During his tenure with the Government of Maharashtra, Mr. sinha was appointed as vice-chairman & Managing Director of Maharashtra state Road Transport corporation Limited, city Industrial Development corporation of Maharashtra Limited; vice-chairman & Managing Director of Maharashtra state Road Development corporation Limited (MsRDc) (during his tenure MsRDc
Hari Sankaran
Non-Executive Director
Associated with the company since November 29, 2000 and with the IL&fs Group since 1990 As vice chairman & Managing Director of IL&fs, he has been instrumental in developing and oversighting the business canvas of the Group
28
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew Board of Directors
32 | sTATuToRy RepoRTs
59 | fINANcIALs
possesses over 26 years of experience in research, project development, structuring, management and financing closely involved in the implementation of all the IL&fs Group Infrastructure projects participated in various High powered committees set up by the Government of India for policy and legal reforms, including as the chairman of the fccI Infrastructure committee Holds a Master’s degree in economics from the London school of economics & political science
prior to joining the IL&fs Group, Mr. Kapoor was associated with the Merchant Banking Division of ANZ Grindlays Bank as a portfolio Manager and as Head of corporate finance and equity Research department of unit Trust of India Mr. Kapoor holds a Bachelor’s degree in Arts and a Master’s degree in Business Administration from the Himachal pradesh university, shimla
In his role as the chief executive officer (Infrastructure) of IL&fs Group, he is associated with various initiatives in infrastructure, including seZs and Maritime Assets Also a member of the Management Board of IL&fs and represents the Boards of various companies within the Group prior to joining IL&fs, he was associated with the operations Research Group, Dalal consultants, Mumbai Metropolitan Region Development Authority and city and Industrial Development corporation of Maharashtra Limited Holds a Bachelor’s degree in civil engineering from Madras university and a post-graduation in ‘Development planning’ from the school of planning, Ahmedabad
Pradeep Puri
Non-Executive Director
An ex-Indian Administrative services officer
arun K Saha
Non-Executive Director
Associated with the company since January 6, 2001 and with IL&fs Group since 1988 presently the Joint Managing Director & ceo of IL&fs, overseeing activities relating to finance, operations, credit compliance and risk management of the IL&fs Group, including activities in the areas of financial services, infrastructure, asset management, distribution and management of retail assets and liabilities Holds a Master’s degree in commerce from the university of Kolkata; is an Associate Member of the Institute of chartered Accountants of India and the Institute of company secretaries of India
Held important positions in the Ministry of commerce and the Department of economic Affairs, Ministry of finance, Government of India, dealing with International Trade and Investment Also closely associated with the Noida Toll Bridge company Limited At present, he serves as the chief executive officer of Model economic Township company Limited Mr. puri holds a Master’s degree in History from Delhi university
Mukund Sapre
Executive Director
Appointed as an executive Director of the company on August 13, 2008 and has been associated with the IL&fs Group since 1992 possesses over 28 years of industry experience prior to joining the company, he was involved with international projects in philippines, Indonesia, Mexico and spain and has played a vital role in implementing the ‘High speed Rail project’ and evaluating the ‘cargo Airport project’ in Mexico Associated with engineers India Limited and Gammon India Limited Holds a Bachelor’s degree in civil engineering, a Diploma in systems Management and also in financial Management
K Ramchand
Managing Director
Appointed as Managing Director of the company on August 13, 2008 and has been associated with IL&fs Group since 1994 with over 30 years of experience in urban and transport infrastructure development sector, he has been involved in a large number of private infrastructure development initiatives, including the successful commissioning of various toll road projects in Gujarat and for the NHAI
vibhav Kapoor
Non-Executive Director
Associated with the company since December 10, 2004 and with IL&fs, the parent company, as its ‘Group chief Investment officer’ since July 1, 2002 and also heads the Group HRD policies and their implementation
29
Transportation
ANNuAL RepoRT 2011-12
Awards and Accolades
ITnl’s annual Report of 2010-11
was conferred by “The League of American professionals (LAcp) vision Award”, the world’s largest annual report competition with the following recognitions:
The platinum Award for excellence within its Industry
13th rank in the Top 100 Annual Reports worldwide
The Best Annual Report cover worldwide for the past fiscal year
Project Parivartan
under project parivartan run by the company along with IL&fs education & Technology services Limited, the sholapur Municipal corporation’s school at Daji peth was recognised for the e-Governance Award for the best IcT-enabled school of the year
30
sAfe
soLID
susTAINABLe
That’s ITNL for you
02 | coRpoRATe oveRvIew
20 | sTRATeGIc RevIew Awards and Accolades |
32 | sTATuToRy RepoRTs corporate Information
59 | fINANcIALs
Corporate Information
Board of Directors
Deepak Dasgupta Chairman Ravi parthasarathy Hari sankaran Arun K saha R c sinha H p Jamdar Deepak satwalekar pradeep puri vibhav Kapoor R s chandra (upto May 18, 2012) K Ramchand Managing Director Mukund sapre Executive Director
Senior Management
K. Ramchand Managing Director Mukund sapre Executive Director Harish Mathur Chief Executive v. K. Raina (Dr.) Technical Director George cherian Chief Financial Officer Krishna Ghag Associate Vice President & Company Secretary
committees of the Board
audit committee
R c sinha Chairman Deepak Dasgupta H p Jamdar Arun K saha
auditors
Deloitte Haskins & sells chartered Accountants
Bankers
Axis Bank Limited
Shareholders’ / Investors’ grievance committee
Arun K saha Chairman K Ramchand
Registered office
The IL&fs financial centre, c-22, GBlock Bandra Kurla complex, Bandra (east) Mumbai 400 051
Remuneration committee
Deepak satwalekar Chairman Ravi parthasarathy Hari sankaran Hari sankaran Chairman Arun K saha pradeep puri K Ramchand Mukund sapre
committee of Directors
Registrar & Share Transfer agents
Link Intime India private Limited c-13, pannalal silk Mills compound L.B.s Marg, Bhandup (west), Mumbai 400 078
company Secretary
Krishna Ghag
31
Transportation
AnnuAl RepoRT 2011-12
ManageMent Discussion anD analysis
1. IndIa’s Infrastructure Industry
The importance of infrastructural growth in india and its contribution, as a catalyst, in transforming the economy has been continuously emphasized upon in the recent past. The indian Government has undertaken a slew of measures to provide ample opportunities for developing and improving infrastructure. The infrastructure deficit in the indian economy presents a substantial need for infrastructure creation. The Government has well understood that the lack of infrastructure is a stumbling block for an unhindered double-digit growth and has instituted several measures conducive for the growth of this sector. Given the capacity (financial and technical) constraints, the Government has put in place a model for infrastructure creation which forecasts financing for project implementation to be met not only through budgetary allocations, but also from private sector participation. This clearly indicates how seriously infrastructure creation is perceived by the Government The Xiith five Year plan (2012-2017) reinforces the Government’s focus on infrastructure creation and upgradation. it envisages a total investment of ` 41 trillion in the infrastructure segment in order to attain a 10% economic growth. The gap in existing infrastructure in india vis-à-vis the averages across the developed world provide a significant opportunity to support india’s growth story and also fuel it. owing to the global financial and sovereign turmoil across developed nations and the huge potential that the indian market offers, the world is looking at the indian market differently. This will not only intensify competition, but also ensure infrastructure creation in india is at par with the best in the world 32
sAfe solid susTAinAble That’s iTnl for you
The IndIan GovernmenT has underTaken a slew of measures To provIde ample opporTunITIes for developInG and ImprovInG InfrasTrucTure.
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
The ` 3000 billion national Highway development project (nHdp), covering a length of 55,000 kms, is the largest highway improvement initiative in the country.
2.
OppOrtunItIes
The success achieved so far in infrastructure development can be largely attributed to the implementation of the public private partnership (ppp) framework project development. under the ppp mode of project structuring, the delivery model becomes more effective and result-oriented. its success has also led to replication of this model across sub-sectors in infrastructure, which augers very well for ppp market players
The nHdp has witnessed a substantial part of its projects being implemented under boT basis across various phases, explained below in detail. it provides a significant opportunity for the development of national Highways, including construction of bridges, flyovers and elevated structures: i. initial phases of nHdp achieved substantial completion. Golden Quadrilateral (GQ) and phases i & ii achieved 99.85% and 81.79% completion, respectively ii. four-laning of 12,109 kms. (nHdp-iii): nHdp (phase-iii) includes upgradation of 12,109 kms (mainly 4 laning) of high density national highways through build, operate & Transfer (boT) mode for a cost of ` 806,260 million. nHdp iii comprises stretches of national Highways carrying huge volume of traffic, connecting state capitals with nHdp’s network under phases i and ii and providing connectivity to places of economic, commercial and tourist importance. Approximately, 80% of this phase iii has either achieved completion or is under implementation and effectively covers the length and breadth of the country. Tamil nadu, Maharashtra, Rajasthan, bihar and Madhya pradesh are some states that have witnessed substantial development of highways under nHdp-iii. of a total of 12,109 kms, nearly 3,342 kms have been completed, 6,314 kms are under implementation and the remaining portion is yet to be awarded Two laning of 14,799 kms. (nHdp-iv): with a view to provide balanced and equitable distribution of an improved/widened highways network, nHdp-iv envisages upgrading of 14,799 kms into 2-lane highways at an indicative cost of ` 278,000 million. This will ensure their 33
a.
roads National Highways Development Project
india’s roads have been the leading infrastructure sub-sector with national Highways Authority of india (nHAi) becoming one of the most successful highway implementing agencies in india. The ` 3000 billion national Highway development project (nHdp), covering a length of 55,000 kms, is the largest highway improvement initiative in the country. nHdp has been structured in a manner that puts in place infrastructure not only to support economic activity, but promulgate it as well The country’s road network stands at a huge 4.2 million kms, a significant portion of which consists of single-lane highways, which are likely to be taken up for expansion in the next five-year plan. The Government is also contemplating to establish a national expressways Authority of india with a mandate to develop approximately 18,000 kms of access-controlled expressways across the country. presently, the road length and their participation in ferrying the traffic is skewed. national Highways carry 40% of the total traffic, while they constitute a mere 2% of india’s road network. on the other hand, state Highways account for 18% of the road length and carry 40% of road traffic. The remaining traffic is taken up by rural roads
Transportation
AnnuAl RepoRT 2011-12
The Government has approved 1,000 kms of expressways to be developed on boT basis and to be constructed on new alignments at an indicative cost of ` 166,800 million.
v.
other Highway projects (nHdp-vii): The Government has envisaged development of ring roads, by-passes, grade separators and service roads, considered necessary for full utilisation of highway capacity as well as for enhanced safety and efficiency. A programme for development of these features has been approved by the Government at an indicative cost of ` 166,800 million. Apart from the highdensity corridors, a substantial part of national Highways network also requires development and are characterised by low density of traffic.
capacity, speed and safety can match minimum benchmarks required for national Highways. Although the overall progress of projects in phase-iv, aggregating approximately 2,549 kms, has not kept pace with other phases, last year saw significant progress. The project lengths under implementation witnessed a 3-fold increase, compared with last year iii. six-laning of 6,500 kms (nHdp-v): under nHdp-v, six-laning of 4-lane highways comprising the GQ and other high-density stretches will be implemented on boT basis for an estimated cost of ` 412,100 million. These corridors have been four-laned as a part of GQ in phase-i of nHdp implementation of the . initial set of projects has already commenced with 818 kms having achieved six-laning. of the 6,500 kms proposed under nHdp-v, about 5,700 kms will be taken up in GQ, while the balance 800 kms will be selected on the basis of predefined eligibility criteria, with a 10% maximum viability Gap funding (vGf). Approximately, 3,581 kms is operational/under construction, as in february 2012 iv. development of 1,000 kms expressways (nHdp-vi): with the growing importance of urban centres in india, particularly those located within a few hundred kms of each other, expressways are both viable and beneficial. The Government has approved 1,000 kms of expressways to be developed on boT basis and to be constructed on new alignments at an indicative cost of ` 166,800 million. nHAi has planned to achieve completion of this phase by december 2015 vi.
some of these stretches fall in backward and inaccessible areas, while some others are of strategic importance special Accelerated Road development programme for the north eastern Region (sARdp-ne): The Ministry has taken up the special Accelerated Road development programme in the north-eastern Region (sARdp-ne) involving widening of 10,141 kms of national Highways and other roads in three phases. This will ensure connectivity of 88 district headquarters in the region to the national Highways The Mumbai Trans Harbour link connecting sewri (Mumbai) to nhava sheva (navi Mumbai) is a significant project being undertaken at an estimated cost of ` 88,000 million. This will be undertaken on boT basis, with the private sector providing funds for its development. The project evinced wide interest from the private sector, with 6 consortia submitting the pre-qualification data, which the Mumbai Metropolitan Regional development Authority (MMRdA) is currently evaluating
Annual Qualification & E-Tendering for projects awarded by NHAI
nHAi has completed its Annual prequalification process, with over 100 applicants having been prequalified. The Annual prequalification process has enabled reducing of the turnaround time spent for the bidding process. This will lead to expediting the award and also reducing the applicants’ efforts, thus enabling them to submit more competitive bids. nHAi has also commenced the e-tendering
34
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
procedure, which has reduced the time spent by bidders in preparation and submission of bids, thereby increasing efficiency of the bidding process
the Xiith five Year plan is to establish a framework for developing and implementing rail transit systems. it is envisaged that a national urban Rail Transit corporation will be set up, responsible for advising state Governments in implementing the Mass Rapid Transit system (MRTs). upgradation of stations and establishment of logistic parks continue to be the Government’s priority The dedicated freight corridor, which aims to connect north india with Mumbai and west bengal, is expected to cost approximately ` 4,000 billion. A series of airports, parks, power plants, etc, too, have
O&M Projects
nHAi has initiated the process for awarding various national Highway stretches on operate, Maintain & Transfer (oMT) contracts. This segment is likely to gain momentum as these stretches (completed under various nHdps) are likely to come up for bidding for improvements and maintenance
State Level Initiatives
state Highways attract a significantly lesser proportion of boT projects, as compared with national Highways. Approximately, 17% of state Highway projects are on boT mode, compared with 73% of national Highways being implemented on this basis. so far, state Roads were financed significantly through budgetary allocations and state Governments are increasingly focussing on improvement of state roads. between 2011-12 and 2015-16, the length of roads and highways upgraded/ constructed is expected to grow at an average 8 per cent. private sector participation in state roads is likely to increase gradually over the next 5 years. between 2011-12 and 2015-16, total investments in state roads are expected to rise by an average 13 per cent, with state Governments increasing their focus on state road programmes. The Government has initiated model bidding documents for state Highways, which is intended to increase their share on ppp basis and provide them with much-needed impetus. states like Gujarat and Rajasthan have been at the forefront of such initiatives
been planned as a part of the infrastructure creation effort. development of an eastern freight corridor has also been proposed to ease the movement of coal and other commodities and to facilitate container movements The budget document of indian Railways for 2012-13 has a provision for setting up indian Railway station development corporation to undertake the following projects to attract private investment through ppp mode:wagon leasing, sidings, private freight
Terminals, container Train operations, Rail connectivity projects (R3i and R2c-i) development of elevated rail corridor from churchgate to virar feasibility study for construction of faster corridor on virar-vasai-diva-panvel
B.
railways
indian Railways, with its wide-reaching network, is one of Asia’s largest railway networks and the world’s second-largest under a single management. being capital intensive, railway projects are mostly funded by budgetary provisions/allocations of the Government. in the last few years, Railways have, lost a significant share of commercial traffic to state Highways and are lagging behind the Highway sector, which has become a leader in the infrastructure development arena. The Xith five Year plan had envisaged a total investment of about ` 200.8 billion in the infrastructure sub-segment, presenting an enormous opportunity. The focus of
35
Transportation
AnnuAl RepoRT 2011-12
in addition to the work being undertaken by itself, the Government is also judiciously pursuing a policy to allow the private sector to participate in development, finance, construction and operation of Metro Railway projects. in the past eight years, several Metro Rail projects have been awarded to private companies on a ppp basis. Most significant amongst these are the Mumbai one project, the Mumbai line 2 project, the Hyderabad Metro, the delhi Airport express line and the Rapid MetroRail Gurgaon project. barring the Mumbai line 2 project, all others projects have achieved financial closure and are either under construction or already in operation. several other projects are expected to be awarded on ppp basis in select cities. Though the ppp market represents only a fraction of projects undertaken by the private sector as a whole, it presents a good opportunity for private sector companies to create assets in partnership with state Governments following Metro Rail projects have been announced by the Government:
subsidiary, il&fs Rail limited, has teamed up with scomi, a leading monorail supplier from Malaysia and submitted qualification documents
(iii) Delhi Monorail
The Government of delhi has announced its intention to build 11 kms monorail system to connect the existing delhi Metro system in west and north delhi. The monorail is expected to be a feeder to delhi Metro system. The company alongwith its subsidiary, il&fs Rail limited, is in discussion with scomi to partner in this project besides these opportunities, there are several other projects being planned in various cities across india, such as chandigarh, Jaipur, patna, Trivandrum and cochin. These are in the feasibility stage and awaiting government approvals
3.
threats
Threats are likely to arise either from major policy changes by the Government or security-related developments in a specific region. some possible threats are mentioned below:
(i) Rapid MetroRail Gurgaon Extension
The Government of Haryana has decided to extend the Rapid MetroRail system to reach a total network capacity of 20 kms. The company alongwith its subsidiary, il&fs Rail limited, has already submitted a proposal
Business environment changes:
The infrastructure business is hugely prone to policy changes and is impacted substantially by changes and modifications. The threat emanates from the long gestation period in the infrastructure business. infrastructure has a huge socio-economic impact and the government must remain aware of this aspect at
(ii) Chennai Monorail
The Government of Tamil nadu has planned to build 57 kms monorail system in chennai, in addition to the chennai Metro presently under implementation. The company alongwith its
36
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
all times. Government policies have been consistent in the Highway segment and have encouraged private sector participation. The significant progress made in the Highway sector is largely attributable to the consistency retained by the government at state and central level. plans for growth of this sector indicate government’s expectations from private sector investment. Any significant change will have an impact on private sector participation, though likelihood of significant changes in business environment are negligible
segment, such as Roads, urban Transport, Railways and development of border check posts. The company has a large and diversified boT Road Asset portfolio and is well poised to reap the benefits of economic growth. The company has ventured into new business areas like border check posts and new geographies in the last year. its capabilities in providing an end-to-end solution for infrastructure creation make it an integrated player in the infrastructure development arena
a.
roads
The financial Year ended March 31, 2012 augured well for the company and it was a year of several firsts. The year saw the company venturing into new locations, both in india and abroad. The company was awarded two new projects by nHAi and one project by pwd Rajasthan. The company acquired a 49% stake in chongqing YuHe expressway company limited, an expressway project located in chongqing in south western china through its subsidiary, iTnl international pte ltd, singapore. besides, there were also additions to its portfolio under Mega Highways project in Rajasthan and Jharkhand Road development programme. The company holds beneficial interest in these projects. The company was able to financially close one of its projects and also raise funds for the acquisition of equity stake in chongqing YuHe expressway company limited
selection criteria:
The current selection criterion for project awards is based on qualification of participants, which is dependent on identified technical and financial criteria. companies desirous of participation are required to submit their credentials for being qualified. The company possesses the required strength for qualifying for all categories of projects in the pipeline. The company has been qualified by nHAi under its annual pre-qualification process
force Majeure threats:
A force Majeure event can lead to abandonment of a project located anywhere in the country. However, all agreements the company has entered into provide risk cover in such circumstances, leading to no significant financial impact. such events have been appropriately covered under insurance policies and Agreements entered into by the company have covered these eventualities
change in Law:
if change in law leads to an impact on infrastructure projects, the concessionaire is insulated from any adverse impact arising from such change in law by the concession Agreement
Additionally:
i. The company was awarded a project for four laning of Kiratpur to ner-chowk section of nH21 from Km 73.200 to Km 186.500 in the state of Himachal pradesh to be executed as boT (Toll) on dbfoT pattern under nHdp phase-iii. The project is on toll basis with a concession period of 28 years, including construction period of 3 years and its estimated cost is ` 22,910 million. The project achieved financial closure on March 29, 2012 ii. The company was awarded the project for construction of new bridges/structures, Repair of existing four lane Highway from Kharagpur to baleshwar section of nH-60 from Km 0.000 to Km 119.300 in the state of orissa and west bengal, including operation & Maintenance to be executed as boT (Toll) on dbfoT pattern under nHdp phase-i. The project is on Toll 37
credit availability:
driven by the push accorded to infrastructure projects on ppp basis, a large number of infrastructure sub-segments seek project financing from banks and financial institutions. The demand arising out of significant requirements of the infrastructure segment may cause institutions appraising them to impose stringent guidelines. The company has a good track record with infrastructure financiers, which ensures projects achieve financial closure
4.
sectOr-wIse perfOrMance
The company has a significant presence in different business verticals in the surface transportation
Transportation
AnnuAl RepoRT 2011-12
basis with a concession period of 24 years, including construction period of 2.5 years. As per nHAi, the estimated project cost will be ` 4,710.5 million iii. The company was awarded the project for development and operation of sikar-bikaner section of nH-11 (Km 340.188 to Km 557.775 via sikar by-pass) and bikaner by-pass from Km 553.869 of nH-11 to Km 267.325 of nH-89 in the state of Rajasthan through public private partnership on design, build, finance, operate and Transfer (dbfoT) basis. The project is on Toll basis with a concession period of 25 years, including construction period of 2 years. As per the public works department, Rajasthan (the “Authority”), the estimated cost of the project is ` 6,508.4 million iv. on december 28, 2011, iTnl international pte. ltd., singapore acquired 49% equity stake in chongqing YuHe expressway company limited, based in china. The project comprises 58.72 Kms of 4-lane carriageway constructed at a cost of RMb 3.5 billion and has bridges and tunnels as a part of its carriageway. The concession period for the project is 30 years of which the residual concession period is 20.5 years. The revenues accrue to the project spv from subsidy and Toll collection v. The company had signed a concession Agreement on April 1, 2009 with Ministry of Road Transport and Highways (MoRTH), Government of india for development and operation of the existing two-lane road from Km 58.245 to Km 177.050 (approximately 116.433 km) on the beawar Gomti section of national Highway no. 8 in the state of Rajasthan on dbfoT (Toll) basis. The provisional completion certificate for the project was issued on August 24, 2010 and the toll collection commenced from August 25, 2010. The concession Agreement also provided for undertaking construction of the four-laning of the project by the concessionaire, iTnl Road infrastructure development company limited, a whollyowned subsidiary of the company. MoRTH has decided to entrust the work for construction of four-laning of the project by iTnl Road vi.
infrastructure development company limited. The estimated cost of the project is ` 12,000 million. The concession period for the project will stand extended from the present 11 years to 30 years from the Appointed date i.e. from october 28, 2009 The company was entrusted with the following projects under the Mega Highway development project in Rajasthan: a) development, design, finance,
construction, operation and Maintenance of Mathura (u.p border) to bhadoti in . Rajasthan by RidcoR on dbfoT (Toll) basis. The estimated project cost is ` 3,875.2 million and Government of Rajasthan will provide a soft loan of ` 1,162.6 million b) development, of design, finance, roads in
construction, operation and Maintenance Rawatsar-nowar-bhadra Rajasthan by RidcoR on dbfoT (Toll) basis. The estimated project cost is ` 2,237.4 million. The Government of Rajasthan will provide a soft loan of ` 447.5 million vii. The company is carrying out the operations and Maintenance activities of the following road projects and maintaining them, as per norms prescribed under the concession Agreements: The Kotakatta by-pass–Kurnool project in Andhra pradesh The Jetpur–Gondal–Rajkot project in Gujarat The belgaum–Maharashtra border project in Karnataka The The Thiruvananthapuram Ahmedabad–Mehsana city Road in improvement project in Kerala project Gujarat The vadodara–Halol project in Gujarat various road stretches project under phase Mega i in Highways Rajasthan viii. under the Jharkhand Accelerated (JARdp), Road the Road
development
programme
38
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
company has been entrusted with two projects, in addition to the three it is already developing. The two new projects are: improvement works of chaibasa-Kandra-chowk Road and Adityapur – Kandra Road, aggregating 198 lane-kms with a concession period of 17.5 & 15.75 years, respectively. The total project cost together is ` 7,330 million ix. The company is currently associated with 50 proposals with various project awarding authorities aggregating 5,357 kms, which are under various stages of development
5.
rIsks & cOncerns
india’s infrastructure industry has tremendous scope to accommodate private partnerships. The Management is positive about the company’s longterm outlook and has a proven capability to assess and manage business risks. in the current economic environment, the company perceives the following risks and concerns:
(1) Market competition:
Roads have been the most progressive of the infrastructure sub-sectors, which has led to increased competition from indian as well as international companies. considering the increasingly competitive market the company operates in, its improved strategy, processes and systems are continuously modified to differentiate and ensure a robust and thriving business models
b.
urban transport :
(i) vansh nimay infraprojects limited (vnil), a subsidiary, is operating a bus service in the city of nagpur, Maharashtra, under a concession from the nagpur Municipal corporation (nMc) for a period of 10 years. currently, the company is operating 470 buses in the city of nagpur Rapid MetroRail Gurgaon limited, a subsidiary, commenced execution of the 5.1 Kms elevated metro rail loop line, connecting sikanderpur station of delhi Metro to the central business district of Gurgaon through dlf cyber city at an estimated cost of ` 10,800 million. The project achieved financial closure in June, 2010 and construction activity commenced in december 2010. As of this month, more than 50% of construction and fabrication work has been completed at the site and at the manufacturing plants. The system is expected to commence commissioning in october 2012, and will receive all permits and clearances from the authorities by March 2013, to commence commercial operation
(2) slowdown in Government spending:
The projections made in the Xith five Year plan estimated the total infrastructure spend at ` 21 trillion, which is expected to be increased to ` 41 trillion during the Xiith five Year plan. The Government expects almost 50% of the above target to be met through private sector participation. considering the substantial infrastructure gap and the huge positive impact infrastructure growth can have on the economy’s overall development, government spending is unlikely to witness a slowdown in the near future
(ii)
The investment commitment (net of advances) as on March 31, 2012, is Rs 11,757.95 million for all the aforesaid projects. This amount will be infused in accordance with the provisions of the financing arrangements to be entered into for each respective project. Typically, lenders ask for infusion of around 40% to 50% of the equity commitment upfront and the balance in accordance with construction progression on reaching a certain specified debtequity level. This investment commitment is, therefore, expected to be infused into respective projects in the next 2-3 years
39
Transportation
AnnuAl RepoRT 2011-12
(3) delay in Government clearances / approvals for projects:
The company understands the importance of attaining timely approvals and clearances for its projects to achieve a smoother execution. The company accords assistance to the various concessioning Authorities for facilitation of clearances. The main document for project is the concession Agreement, which provides risk mitigation and timelines for obtaining clearances
increase in prices. The company has put in place a system whereby contractors and the company share increase in costs in order to sustain quality objectives
(6) force Majeure
force Majeure risks have been mitigated by obtaining adequate insurance cover for the company. Also, the concession Agreement has provisions for extension to offset losses incurred by the concessionaire due to force majeure events. The concession Agreement provides protection to the concessionaire with no adverse impact and subsequently avails refinancing/ structured financial products to reduce such costs
(4) retention of experienced Manpower:
The company encourages a culture that develops and empowers people, promotes team building, nurtures individuals and uses good people practices to support HR processes and initiatives. The company continues to undertake various initiatives for development of Human Resources and to maintain a healthy and harmonious relationship within the organisation The company lays great emphasis on optimizing performance through various processes. some of these are: attracting good talent and moves through learning & development, engagement and sustaining high motivation levels of people through attractive rewards and recognition
(7) Increased cost of Borrowings
The nature of the company’s business requires it to borrow from banks/financial institutions for project financing. while formulating its strategy for the proposals, the company examines possible solutions to factor in increased cost of borrowing and mitigating its impact
6.
OutLOOk:
inclusive development has been a key concern for the indian Government, which can be achieved by broad-based infrastructure creation, connecting various parts of the country. This augurs well for the private sector to partner with the Government to consistently develop infrastructure and reduce the infrastructure deficit. The company has a diverse asset portfolio which positions it uniquely for leveraging the emerging opportunities The company is extremely optimistic that its portfolio of projects will significantly improve its
(5) Price Inflation Risk:
input materials comprise a substantial component of construction cost. over the years, the company has developed in-house capabilities for accurate and reliable cost estimation. The bidding department, while preparing for the project in report, employs mechanisms factoring inflation-related
40
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
financial performance. it is also targeting large-sized highway projects in india and in the international arena The company is also closely monitoring investments made in boT projects and constantly reviewing and strengthening its systems and procedures. it has also obtained iso 9001:2008 certification. during the year, the company was also awarded iso 14001:2004 and oHsAs 18001:2007 certifications for its environmental, Health and safety Management system The company is optimistic about the growth of india’s infrastructure industry and its ability to achieve targets on account of: number of projects in its order book; robust pipeline arising from priority accorded to infrastructure development; strong, efficient and skilled workforce; and continuing support from bankers
As a result of business growth, there has been an increase in employee cost and general administration arising from increased head count financing cost increased by ` 1,101 million as a result of higher borrowings to fund higher level of operations and also on account of continuous rise in interest rates. The debt-equity ratio as at March 31, 2012 stood at 1.40 : 1 As a result of the above, profit before tax reduced from ` 4,517.39 million during 2010-11 to ` 4,136.48 million during 2011-12, a decline of 8.43%. The average rate of tax applicable increased to 39% from 36% as a result of disallowance of interest considered on borrowed funds invested in equity. consequently, profit after tax reduced from ` 2,880.36 million to ` 2,522.98 million during 201112, a decline of 12.41% earnings per share on basic and diluted basis stood at ` 12.99 per share as at March 31, 2012 as against ` 14.83 per share as at March 31, 2011 translating into a price to earnings ratio of 14.86 times as against 15.84 times as on March 31, 2011. The price to book ratio was 1.93 times, compared with 2.56 times
7.
dIscussIOn On fInancIaL perfOrMance wIth respect tO OperatIOnaL perfOrMance standalone
during the financial Year 2011-12, the company’s turnover increased by 71% to ` 29,102.46 million, up from ` 17,009.80 million in financial Year 2010-11. This is on account of the increase in construction activity in existing projects. This is also a result of the rise in number of projects in which construction activity was undertaken, which rose from 6 in 2010-11 to 8 in 2011-12 This has resulted in a consequential increase in construction costs. There is an increase in the operation & Maintenance expenditure since expenditure was incurred during the full year for all the projects, as against part of the year during 2010-11. other key operating data for the year comprises the following: earnings before interest, Tax, depreciation and Amortization increased from ` 6,170.55 million in 2010-11 to ` 6,898.51 million in 2011-12, registering an increase of 11.80%. However, ebiTdA margin reduced from 36% to 24% mainly as a result of the change in composition of revenues, with lower margin construction revenues making up almost 77% of total revenues as against 62% in 2010-11
consolidated
during financial Year 2011-12, consolidated revenues increased 39% to ` 57,294.28 million from ` 41,268.54 million over the previous year. This was largely on account of the increase in construction activity in existing projects and also increase in number of projects in which construction activity was undertaken. The latter rose from 6 in 2010-11 to 8 in 2011-12, resulting in a consequential increase in construction and other costs earnings before interest, Tax, depreciation and Amortization increased to ` 15,893.56 million in 2011-12, up from ` 12,334.66 million in 2010-11, an increase of 29%. However, ebiTdA margin reduced marginally from 30% in 2010-11 to 28% in 2011-12. This was mainly as a result of the change in composition of revenues, with lower margin construction revenues making up almost 72% of total revenues, as against 67% in 2010-11 As a result of growth in business, there has been an increase in employee costs and general administration arising from increased head count financing cost increased by ` 2,301 million during 2011-12 due to higher draw down of debt in project spvs to fund higher level of construction activity and 41
Transportation
AnnuAl RepoRT 2011-12
also on account of increase in interest rates during the year. debt equity ratio as at March 31, 2012 on a consolidated basis stood at 3.70: 1 profit before tax increased to ` 7,845.97 million in 2011-12 from ` 6,739.78 million in 2010-11, registering an increase of 16.41% as a result of factors outlined in preceding paragraphs. Average rate of tax during 2011-12 fell to 31% from 33% primarily on account of recognition of a deferred tax asset on unabsorbed depreciation in one of the subsidiary companies. profit after tax increased to ` 4,969.58 million in 2011-12 from ` 4,328.79 million in 2010-11, an increase of 14.80% earnings per share on basic and diluted basis stood at ` 25.48 per share as at March 31, 2012, as against ` 22.19 per share in the previous year, translating into a price to earnings ratio of 7.58 times as on March 31, 2012 as against 10.59 times in the previous year. price to book ratio was 1.36 times against 2.04 times as at March 31, 2011
8.
huMan resOurces and IndustrIaL reLatIOns
The company is driven by its dynamic workforce, imbued by the spirit of keeping the organization as an industry frontrunner. The company’s focus is to build an organization of highly-motivated employees, with the ability to execute ambitious business goals with acute passion and commitment The company has formulated an attractive reward and compensation structure to sustain high motivation levels of its workforce. besides, its scalable recruitment and retention strategy enables it to attract and retain high caliber employees The company encourages its employees to
participate in various development programmes conducted at all levels. This can be done by using internal resources and /or engaging external facilitators / trainers for upgrading employee skills-sets on a periodic basis and enabling them to compete with unpredictable challenges ahead Training programmes attended by employees during the year are:
sr. no. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21.
training programme / seminars / workshops seminar on insurance Awareness Recent changes in service Tax law and procedures conference on Tunnel construction in india Road safety & Traffic Management conference on “4th national india Roads 2011” seminar on Transfer pricing Tunnel design and construction Asia 2011 public private partnership in Road and Transport infrastructure un decade of Action plan on Road safety workshop on project finance conference on public private partnership in national Highways infra conclave Rajasthan 2011 design, construction and Maintenance of flexible pavements Rigid pavements: design, construction & Quality control Aspects bridge diagnostics, performance, evaluation and Rehabilitation Reliability based design - pile & deep foundation intensive Training on Guarantees, standby letters of credits & letters of credits seminar on practical issues in indirect Tax conference on Road infrastructure in india 2011 Tunnels and underground construction in india conference on operation, Maintenance and Tolling in Road sector conference on foundation and piling works for infrastructure in india
42
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Management discussion and Analysis
59 | finAnciAls
sr. no. 22. 23. 24. 25. 26. 27. 28.
training programme / seminars / workshops international summit on public private partnership in Roads & Highways iRf General Assembly Meetings & 2012 inter traffic Amsterdam – international Trade fair And seminar 5th indian Roads conference 2012 Advanced cost engineering & strategic cost Management for infrastructure projects Airport development and Modernisation public private partnership conference at Abu dhabi financing of Road projects
9.
cautIOnary stateMent
certain statements made in the Management discussion and Analysis Report relating to the company’s objectives, projections, outlook, expectations, estimates and others may constitute ‘forward looking statements’ within the meaning of applicable laws and regulations. Actual results may differ from such expectations, projections and so on whether express or implied. several factors could make significant difference to the company’s operations. These include climatic conditions and economic conditions affecting demand and supply, government regulations and taxation, natural calamities and so on over which the company does not have any direct control
43
Transportation
AnnuAl RepoRT 2011-12
DiRectoRs’ RePoRt
The shareholders
IL&fs transportation networks Limited
Your directors have pleasure in presenting the Twelfth Annual Report alongwith the Audited statements of Accounts for the year ended March 31, 2012
fInancIaL resuLts
The financial results of the company are as under: (` in million) for the year ended March 31, 2012 Total income earnings before interest, Tax, depreciation and Amortisation (ebiTdA) profit before Tax profit After Tax balance brought forward profit available for appropriation Appropriation: dividend proposed/paid Tax on dividend General Reserve balance carried forward (777.07) (126.06) (252.30) 6,183.90 (679.94) (110.30) (288.04) 4,816.35 29,102.46 6,898.51 for the year ended March 31, 2011 17,009.80 6,170.55
4,136.48 2,522.98 4,816.35 7,339.33
4,517.39 2,880.36 3,014.27 5,894.63
The Board of dIrecTors has recommended a fInal dIvIdend of ` 4 per equITy share of The face value of ` 10/- each for The fInancIal year ended march 31, 2012.
44
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs directors’ Report
59 | finAnciAls
Your company continues to maintain its leading position in the surface Transport sector with 28 projects in its portfolio in various stages aggregating to around 11,859 lane kms (including around 2,621 lane kms in respect of which your company is the lowest/preferred bidder
dIVIdend
Your directors have recommended payment of dividend of ` 4 per share (previous Year: ` 3.50 per share) for the year under review. The proposed dividend, if approved at the Annual General Meeting, will absorb a sum of ` 903.13 million including tax on dividend of ` 126.06 million (previous Year: ` 790.24 million including dividend tax of ` 110.30 million)
Rajasthan. Also, Government of Rajasthan awarded 2 projects to RidcoR, aggregating to 303.50 kms with a total project cost of ` 22.89 billion nHAi, the key highway implementation arm of the Government of india has implemented the e-tendering process for price proposals and have continued with the annual pre-qualification of bidders. This has led to a substantial reduction in the effort required for bid submission. in the annual pre-qualification process undertaken by nHAi, the company has been qualified to bid for projects having an estimated cost of upto ` 53,592.9 million, which enables the company to participate in virtually all projects on its own Your company through iTnl international pte ltd, singapore (iipl), a wholly owned subsidiary acquired 49% equity stake in chongqing YuHe expressway company ltd, which owns a 58 km expressway connecting downtown chongqing with Hechuan county in chongqing, in the people’s Republic of china with toll concession rights till June 2032 The company also acquired a 61.22% equity stake in futureage infrastructure india limited (fiil) for developing an Automated car parking facility for about 440 cars, at Hyderabad in the vicinity of charminar. Amongst the other sectors of transport in the ambit of the company, construction on the Rail project in Gurgaon continued during the financial year. The urban bus Transport system in the city of nagpur continued its slow progress elsamex is following up for contracts in Abu dhabi and Mexico and continues to have orders in operations & Maintenance of Roads & buildings in spain that are at levels similar to that in the previous year. A number of other leads are being pursued and efforts are being made to stabilise the operations. elsamex has signed a contract for Road Rehabilitation works in Haiti for euro 40.72 45
perfOrMance reVIew
Your company continues to maintain its leading position in the surface Transport sector with 28 projects in its portfolio in various stages aggregating to around 11,859 lane kms (including around 2,621 lane kms in respect of which your company is the lowest/preferred bidder). during the year gone by, the company operationalised 460 lane kms under RidcoR phase ii projects, received provisional completion certificate for 173 lane kms of the eHel project and added 235 lane kms to its portfolio by acquisition of 49% stake in Yuhe expressway company through iTnl international pte ltd., a wholly owned subsidiary in singapore. As at March 31, 2012, 14 projects have been operational with an aggregate length of approximately 5,453 lane kms fY 2012 witnessed a spurt in the award of projects by the Government with emphasis on the ppp route. The Government, through its various instrumentalities awarded 7,957 kms in 62 projects, which is an improvement of 54% over the previous year. This comprises of 6,491 km by nHAi (49 projects) and 1,466 kms (13 projects) by Ministry of Road Transport and Highways. The company was awarded 2 projects by nHAi, namely, Kiratpur ner chowk project in the state of Himachal pradesh and baleshwar Kharagpur Road project in the states of west bengal and orrisa. in addition to these, the company was also awarded the development and operation of sikar – bikaner stretch of nH 11, a project of 237.57 kms with a project cost of ` 6.51 billion by nH division, pwd,
Transportation
AnnuAl RepoRT 2011-12
fY 2012 witnessed a spurt in the award of projects by the Government with emphasis on the ppp route. The Government, through its various instrumentalities awarded 7,957 kms in 62 projects, which is an improvement of 54% over the previous year.
million in January 2012. This project is being funded by the european union. The profit after tax for fY2012 stands at euro 1.97 million Your company has adopted two of elsamex’s
attached with this Annual Report. However, the accounts of the subsidiaries will be made available on the website of the company and on request, for inspection to shareholders seeking such information, at the Registered office of the company
dIrectOrs
Mr. deepak dasgupta, Mr. deepak satwalekar, Mr. vibhav Kapoor and Mr. pradeep puri, directors are liable to retire by rotation at the forthcoming Annual General Meeting of the company and being eligible offer themselves for re-appointment. Your directors recommend their reappointment
audItOrs
Messrs deloitte Haskins & sells, chartered Accountants, statutory Auditors, retire at the ensuing Annual General Meeting and have expressed their willingness to continue as statutory Auditors, if re-appointed
technologies viz “Micro surfacing” and “warm Mix Asphalt Technology” which are environmental friendly and specifically designed to reduce energy consumption Your company closely monitors investments made in the boT projects and continuously reviews and strengthens its systems and procedures and has obtained iso 9001:2008 certification. during the year under review, your company was also awarded iso 14001:2004 and oHsAs 18001:2007 certifications for its environmental,Health and safety Management system
depOsIts
Your company has not accepted any fixed deposits during the year under review
cOrpOrate GOVernance
Your company believes in adhering to good governance practices and has fully complied with the requirements/ disclosures that have to be made in this regard. A Report on corporate Governance is enclosed and forms part of this Annual Report. A certificate from the statutory Auditors on compliance with the provisions of corporate Governance is also annexed to this Report
suBsIdIarIes
The consolidated financial statements have been prepared in accordance with the Accounting standards 21, 23 and 27 of the institute of chartered Accountants of india. As required under section 212(8) of the companies Act, 1956, the statement of holdings in subsidiaries and consolidated Accounts pursuant to Accounting standard (As-21) issued by the institute of chartered Accountants of india, form part of the Annual Report. in terms of the notification dated february 8, 2011 issued by the Ministry of corporate Affairs (McA), amending section 212 of the companies Act, 1956, the board of directors of the company at its Meeting held on May 4, 2012 noted the provisions of the circular of the McA and passed the necessary resolution granting the requisite approvals for not attaching a copy of the balance sheet, profit and loss Account and Reports etc of the subsidiaries along with the Annual Report of the company for the financial year 2011-12. The disclosure relating to financials of the subsidiaries is included in the consolidated balance sheet. The accounts of subsidiary companies are therefore not 46
sAfe solid susTAinAble That’s iTnl for you
enVIrOnMentaL and sOcIaL pOLIcy fraMewOrk
in its pursuit of following the best business practices, your company has adopted the environmental and social policy framework (espf) to address the environmental and social risks associated with the business of the company. espf has been founded on the concept of sustainable development and recognises environmental and social (e&s) considerations in its business operations so as to add value and minimise any adverse impact and risks on the business. Your company being a pan india developer, operator and facilitator of infrastructure projects, recognises the importance of ensuring proper management of e&s risk for each of its projects. espf will enable the company to identify e&s risks associated with projects prior to submission of bids and depending on
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs directors’ Report
59 | finAnciAls
the outcome of Risk Rating and its impact, the company would be able to address the relevant e&s impact and initiate suitable mitigation measures
safeguarding the assets of the company and for preventing and detecting fraud and other irregularities (4) they have prepared the annual accounts on a going concern basis
partIcuLars Of eMpLOyees
The information regarding particulars of remuneration etc of certain employees required under section 217(2A) of the companies Act, 1956 and the rules made thereunder is given in an Annexure which forms part of this report. in terms of section 219(1)(b)(iv) of the companies Act, 1956, the directors’ Report and Accounts are being sent to the shareholders without this Annexure. Any shareholder interested in obtaining this Annexure may write to the company secretary at the Registered office of the company
fOreIGn eXchanGe earnInGs and eXpendIture
The foreign exchange income during the year was ` 64.51 million and expenditure during the year was ` 210.24 million since the company does not have any manufacturing facility, the other particulars required to be provided in terms of the companies (disclosure of particulars in the Report of board of directors) Rules, 1988 are not applicable
dIrectOrs’ respOnsIBILIty stateMent
pursuant to section 217(2AA) of the companies Act, 1956, the directors, based on the representations received from the operating Management, confirm that: (1) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures (2) they have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for that period (3) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for
acknOwLedGMents
The directors place on record their appreciation for the continued support and co-operation received from the various Government Authorities including national Highways Authority of india and other Regulatory Authorities, banks, financial institutions and shareholders of the company The directors would also like to place on record their appreciation for the contribution and dedication of the employees of the company at all levels
by the order of the board
bengaluru, May 4, 2012
deepak dasgupta chairman
47
Transportation
AnnuAl RepoRT 2011-12
RePoRt on coRPoRate goVeRnance
1. cOMpany’s phILOsOphy On cOrpOrate GOVernance
At il&fs Transportation networks limited, the corporate Governance has been an integral part of the way we have been doing our business since inception. we believe that good corporate Governance is the application of best management practices, compliance of law and adherence to ethical standards to achieve the company’s objective of enhancing shareholder’s value and discharge of social responsibility The company places great emphasis on values such as empowerment and integrity of its employees, safety of the employees & communities surrounding our roads, transparency in decision making process, fair & ethical dealings with all and last but not the least, accountability to all the stakeholders The corporate Governance framework in the company has been strengthened with the adoption of the code of conduct and the code of conduct for prevention of insider Trading. The company is committed to meet aspirations of its stakeholders and is striving to be a part of the social development of the country
2.
BOard Of dIrectOrs composition
The company’s policy is to maintain an optimum combination of executive & non-executive directors. The board presently comprises of 12 directors, including 2 executive and 10 non-executive directors, of which 4 are independent directors. The directors are professionals, have expertise in their respective functional areas and bring a wide range of skills and experience to the board
The company Is commITTed To meeT aspIraTIons of ITs sTakeholders and Is sTrIvInG To Be a parT of The socIal developmenT of The counTry
48
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Report on corporate Governance
59 | finAnciAls
none of the directors on the board is a member of more than ten committees or chairman of more than five committees across all the companies in which he is a director. As required under clause 49 of the listing Agreement, necessary disclosures regarding committee positions have been made by the directors during the year under review, the board met 4 (four) times on the following dates: (i) April 29, 2011, (ii) August 5, 2011, (iii) november 9, 2011 and (iv) february 7, 2012 The Agenda and the explanatory notes forming part of agenda are prepared and circulated in advance to the directors. presentations are made on operations / business to the board by the Managing director / executive director name category attendance at Board meeting
category & attendance of directors
The names and categories of the directors on the board, their attendance at the board Meetings held during the year under review, alongwith the number of directorships and committee memberships held by them in other companies as on March 31, 2012 are given below. The directorships in other companies exclude those held in private limited companies, associations, companies incorporated outside india and alternate directorships. The chairmanship / Membership of the committees include memberships of Audit and shareholders’ / investors’ Grievance committees. The details of attendance of the directors at the Annual General Meeting held on August 5, 2011 is also provided attendance at annual General Meeting number of directorships in other public companies chairman Yes 2 Member 3 number of committee positions held in other public companies chairman Member 1 2
held Mr. deepak dasgupta (chairman) Mr. R. c. sinha Mr. H. p Jamdar . Mr. deepak satwalekar Mr. Ravi parthasarathy Mr. Hari sankaran Mr. Arun K. saha Mr. vibhav Kapoor Mr. pradeep puri Mr. R s chandra non-executive, independent non-executive, independent non-executive, independent non-executive, independent non-executive, non-independent non-executive, non-independent non-executive, non-independent non-executive, non-independent non-executive, non-independent non- executive, non-independent 4
attended 4
4 4 4 4 4 4 4 4 4 4 4
4 4 4 4 4 4 4 2 2 4 3
Yes Yes Yes Yes Yes Yes Yes no Yes Yes Yes
8 3 1 -
1 1 5 3 12 10 4 9 2 13 12
2 2 2 1 -
2 3 6 2 4 6
Mr. K Ramchand executive, (Managing director) non-independent Mr. Mukund sapre (executive director) executive, non-independent
49
Transportation
AnnuAl RepoRT 2011-12
directors seeking re-appointment
details of the directors seeking re-appointment at the forthcoming Annual General Meeting as required under clause 49 iv (G) of the listing Agreement are annexed to the notice convening the Annual General Meeting and forms part of this Annual Report
terms of reference
The terms of reference inter alia, include overseeing of the company’s financial reporting process, reviewing the financial statements with the Management, recommending appointment / reappointment of auditors, fixation of audit fees, reviewing the adequacy of internal audit function, periodic discussions with auditors about their scope and adequacy of internal control systems, discussion on any significant findings made by internal Auditors and follow up action. The committee also reviews information prescribed under clause 49(ii)(e) of the listing Agreement with the stock exchanges
3.
audIt cOMMIttee composition
The Audit committee of the company presently comprises of 4 non-executive directors namely, Mr. R c sinha as chairman, Mr. deepak dasgupta, Mr. H p Jamdar and Mr. Arun K saha, Members. except for Mr. saha, all other members are independent directors. Mr. Krishna Ghag, company secretary is the secretary of the Audit committee The composition, role, terms of reference as well as powers of the Audit committee are in accordance with the provisions of clause 49 of the listing Agreement and section 292A of the companies Act, 1956
Meetings held
during the year under review, four Audit committee meetings were held on the following dates: (i) April 29, 2011, (ii) August 5, 2011, (iii) november 9, 2011 and (iv) february 6, 2012
attendance
The attendance at the meetings of the Audit committees held during the period April 1, 2011 to March 31, 2012 are given below: name of director Mr. R c sinha Mr. deepak dasgupta Mr. H p Jamdar Mr. Arun K saha designation chairman Member Member Member category of directorship non-executive, independent non-executive, independent non-executive, independent non-executive, non-independent no of Meetings held 4 4 4 4 attended 4 4 4 4
The Managing director, executive director and chief financial officer of the company attend the meetings. The representatives of the statutory and internal Auditors are also present at the meetings The last Annual General Meeting (AGM) of the company was held on August 5, 2011 and Mr. R.c. sinha, chairman of the Audit committee was present at the AGM
4.
sharehOLders’ / InVestOrs’ GrIeVance cOMMIttee composition
The shareholders’ / investors’ Grievance committee comprises of 2 directors, namely, Mr. Arun K saha, non-executive director as chairman and Mr. K Ramchand, Managing director. Mr. Krishna Ghag, company secretary, is the compliance officer Terms of Reference The terms of reference specifically includes redressal of shareholders/investors grievances pertaining to transfer / dematerialization / rematerialisation of shares, non–receipt of dividend /annual report/ notices, etc
50
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Report on corporate Governance
59 | finAnciAls
Meetings held
during the year under review, five committee meetings were held on the following dates: (i) April 14, 2011, (ii) June 15, 2011, (iii) July 4, 2011, (iv) october 25, 2011 and (v) January 27, 2012
attendance
name of director Mr. Arun K saha designation chairman category of directorship non- executive, non-independent executive, non-independent no of Meetings held 5 5 Mr. K Ramchand, Managing Member director attended 5 5
details of investor complaints received and redressed: The company had received 20 complaints during the period April 1, 2011 to March 31, 2012 and the same were resolved to the satisfaction of the investors. There was no complaint lying unresolved as on March 31, 2012
5.
cOMMIttee Of dIrectOrs composition
The board of directors of the company had constituted a committee of directors to approve the proposals concerning day to day operations for smooth conduct of the business. The committee comprises of Mr. Hari sankaran, Mr. Arun K saha, Mr. pradeep puri, non-executive directors, Mr. K Ramchand, Managing director and Mr. Mukund sapre, executive director
reviewing the performance of the employees, approving the annual remuneration and performance related pay to whole-time directors and the employees of the company for each financial year
Meetings held
no Meeting was held during the year under review
Remuneration Policy
The company’s remuneration policy is driven by the success and performance of the company and the individual employee. 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 related pay. The performance related pay is determined by business performance and the performance of individual employee measured through the annual appraisal process (i) (a) executive directors The company pays remuneration to its Managing director and executive director by way of salary, perquisites and & allowances (fixed related component) pay (variable performance
Meetings held
The committee of directors met 11 times during the period under review on (i) April 14, 2011, (ii) May 30, 2011, (iii) July 19, 2011, (iv) August 9, 2011 (v) september 28, 2011, (vi) november 3, 2011, (vii) december 5, 2011, (viii) december 19, 2011, (ix) January 25, 2012, (x) february 29, 2012 and (xi) March 20, 2012
6.
reMuneratIOn cOMMIttee composition
The Remuneration committee of the company comprises of 3 non-executive directors, namely, Mr. deepak satwalekar as chairman, Mr. Ravi parthasarathy and Mr. Hari sankaran as Members
terms of reference
The terms of reference inter alia include determining the company’s policy on specific remuneration packages including pension rights and other compensation for employees of the company,
component). This is determined based on individual employee wise performance and the company’s overall performance in a financial year, as may be determined by the Remuneration committee of the
51
Transportation
AnnuAl RepoRT 2011-12
board, at the end of each financial year, subject to the overall ceilings stipulated in sections 198 and 309 of the companies Act, 1956 The details of remuneration and perquisites paid to Mr. K Ramchand, Managing director and Mr. Mukund sapre, executive director for the financial year ended March 31, 2012 are as follows: terms of agreement period of appointment date of appointment salary (`) perquisites (`) Retirement benefits (`) performance linked incentive (`) notice period severance fees Mr. k ramchand (Managing director) 5 years August 13, 2008 1,85,93,337 37,17,092 57,99,424 2,50,00,000 Three months There is no separate provision for payment of severance fees The company does not have any stock option plan for its employees (b) non-executive directors: (a) The non-executive directors are paid remuneration by way of commission and sitting fees. in terms of the shareholders’ approval obtained at the Annual General Meeting held on August 4, 2010, the commission payable to the non-executive directors shall not exceed 1% of the net profit of the company computed in accordance with section 309(5) of the companies Act, 1956. The commission is distributed on uniform basis to reinforce the principle of collective responsibility of directors. However, an additional amount is also paid to the chairman of the board and chairman/Members of the Audit and Remuneration committees for the responsibility and time spent by them. The said commission is decided each year by the board of directors The company pays sitting fees @ ` 20,000 per meeting (subject to tax) to its non-executive directors for attending meetings of the board and committees of the board. The company also reimburses out-ofpocket expenses incurred by the directors for attending the meetings The details of sitting fees and commission paid during the period April 1, 2011 to March 31, 2012 are given below: name of director Mr. deepak dasgupta Mr. R. c. sinha Mr. H p Jamdar Mr. deepak satwalekar Mr. Ravi parthasarathy Mr. Hari sankaran Mr. Arun K saha Mr. vibhav Kapoor Mr. pradeep puri Mr. R s chandra sitting fees (`) 1,60,000 1,60,000 1,60,000 80,000 80,000 2,76,667 4,53,334 80,000 40,000 40,000 commission (`) 15,00,000 11,00,000 10,00,000 10,00,000 10,00,000 10,00,000 10,00,000 8,00,000 8,00,000 8,00,000 Mr. Mukund sapre (executive director) 5 years August 13, 2008 85,15,955 33,97,792 17,32,500 1,65,00,000
(b)
(c)
52
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Report on corporate Governance
59 | finAnciAls
(d)
details of shares held by the non-executive directors as on March 31, 2012 are given below: sr. no. 1 2 3 4 5 6 7 name of director Mr. deepak dasgupta Mr. Ravi parthasarathy Mr. Hari sankaran Mr. vibhav Kapoor Mr. Arun K. saha Mr. R.c. sinha Mr. pradeep puri no of shares held 79 3,14,800 3,40,957 3,14,800 3,19,537 53 31,652
(e)
none of the non-executive directors had any material pecuniary relationship or transactions with the company
7.
GeneraL BOdy MeetInGs (a) details of annual General Meeting (aGM) / extra Ordinary General Meeting (eGM) held during the last 3 years are given below:
financial Venue year 2008-09 The il&fs financial centre, c-22, G-block, bandra – Kurla complex, bandra (east), Mumbai 400 051 The il&fs financial centre, c-22, G-block, bandra – Kurla complex, bandra (east), Mumbai 400 051 2009-10 2010-11 Y. b. chavan Auditorium, Gen. J. bhosale Marg, Mumbai 400021 Y. b. chavan Auditorium, Gen. J. bhosale Marg, Mumbai 400021 date time aGM / eGM special resolutions passed 2
August 4, 2009
12.00 noon
eGM
september 9, 2009
10.30 a.m.
AGM
-
August 4, 2010 August 5, 2011
3.30 pm 3.30 pm
AGM AGM
2 -
none of the resolutions were required to be passed through postal ballot. At present, no special Resolutions are proposed to be passed through postal ballot
8.
(a)
dIscLOsures
The company has followed all relevant Accounting standards notified by the companies (Accounting standards) Rules, 2006 while preparing the financial statements There were no materially significant related party transactions i.e. transactions of a material nature, with its promoters, directors or the management, their subsidiaries or relatives etc. during the financial year under review that may have potential conflict with the interests of the company at large except for those disclosed in the financial statements for the year ended March 31, 2012 pursuant to the disclosures made by the senior Management personnel of the company to the board, there were no material, financial and
commercial transactions undertaken by them, which could have potential conflict with the interest of the company at large (d) presentations made to the institutional investors and Analysts are posted on the company’s website (e) There were no instances of non-compliance by the company, no penalties/strictures imposed on the company by the stock exchange or sebi or any statutory authority on any matters related to the capital markets during the period April 1, 2011 to March 31, 2012 (f) in terms of clause 49(v) of the listing Agreement, the Managing director and chief financial officer have furnished the requisite certificates to the board of directors
(b)
(c)
53
Transportation
AnnuAl RepoRT 2011-12
(g)
The board of directors has adopted a code of conduct which lays down various principles of ethics and compliance. The code has been circulated to all the directors and employees of the company and has also been posted on the company’s website further, all the members of the board and senior Management personnel have affirmed compliance with the company’s code of conduct. A declaration to this effect by the Managing director forms part of this report
ii.
The company continues to adopt best practices to ensure the regime of unqualified financial statements. no audit qualifications have been reported on the company’s financial statement for the year ended March 31, 2012 The company has set up a Remuneration committee as per the provisions of clause 49 of the listing Agreement
iii.
9.
Means Of cOMMunIcatIOn
The Quarterly and Annual consolidated financial Results are published in leading newspapers in india. The financial Results are also filed with the stock exchanges and posted on the company’s website All the official news releases are sent to the stock exchanges as well as displayed on the company’s website The company’s website: www.itnlindia.com provides comprehensive information about its business. section on “investors Relations” serves to inform and service the shareholders allowing them to access information at their convenience. presentations made to institutional investors and the shareholding pattern of the company on weekly basis is also displayed on the website A Management discussion & Analysis statement is a part of the company’s Annual Report
(h)
The company has complied with all the mandatory requirements under the provisions of clause 49 of the listing Agreement relating to corporate Governance for the period April 1, 2011 to March 31, 2012 A Reconciliation of share capital Audit is conducted every quarter by a qualified practising company secretary to reconcile the total admitted capital with both the depositories namely, national securities depository limited and central depository services (india) limited and the total issued and listed capital. The said report confirms that the total issued/paid up capital is in agreement with the total number of shares held in physical form and the total number of shares in dematerialised form with the depositories compliance with non Mandatory requirements; i. The code of conduct adopted by the company provides a mechanism for employees to report about unethical behavior, actual or suspected fraud or violation of the code
(i)
(j)
10. GeneraL sharehOLder InfOrMatIOn:
I. Annual General Meeting(AGM) day/date Time venue II. III. IV. V. : Thursday, August 9, 2012 3.30 pm Y b chavan Auditorium Gen. J. bhosale Marg, Mumbai 400 021 : : : : April 1 to March 31 wednesday, August 1, 2012 to Thursday, August 9, 2012 The dividend, if declared, shall be paid/credited before september 7, 2012 (i) national stock exchange of india limited (nse) (ii) bombay stock exchange limited (bse) listing fees have been paid VI. scrip code : il&fsTRAns eQ – nse 533177 – bse
financial year date of book closure dividend payment date listing on stock exchanges
54
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Report on corporate Governance
59 | finAnciAls
VII. Market price data (High/low during each month) on nse & bse: Month high Apr-11 May-11 Jun-11 Jul-11 Aug-11 sep-11 oct-11 nov-11 dec-11 Jan-12 feb-12 Mar-12 256.85 219.00 218.80 230.50 214.90 212.00 218.30 231.00 178.00 214.00 223.90 199.00 nse Low 207.10 186.00 191.60 206.00 168.00 180.25 190.10 162.85 144.00 142.55 186.00 179.50 high 256.65 217.45 218.70 230.50 213.95 212.70 217.30 209.90 182.00 214.45 224.30 198.95 Bse Low 207.00 185.30 192.00 206.00 170.00 179.55 190.80 167.25 145.00 143.10 181.00 180.10
VIII. performance of company’s share price in comparison with nse nifTY and bse senseX during the fY 2011-12 ITNL Share Price/NSE Nifty (High)
300 285 270 255 240 225 210 195 180 165 150 May 11 Aug 11 nov 11 dec 11 Mar 12 sep 11 feb 12 Apr 11 Jun 11 oct 11 Jan 12 Jul 11 6,000 5,800
Share Price
NSE Nifty
5,600 5,400 5,200 5,000
ITNL Share Price NSE Nifty
Month
ITNL Share Price/BSE Sensex (High)
300 285 270 255 240 225 210 195 180 165 150 feb 12 May 11 Aug 11 nov 11 dec 11 Mar 12 Apr 11 Jun 11 Jul 11 sep 11 oct 11 Jan 12 20,000 19,000
Share Price
BSE Sensex
18,000 17,000 16,000 15,000
ITNL Share Price BSE Sensex
Month
55
Transportation
AnnuAl RepoRT 2011-12
IX. Registrar and share Transfer Agents: link intime india private limited c-13, pannalal silk Mills compound, l.b.s Marg, bhandup (west), Mumbai 400 078 Telephone no : +91-22-25960320 fax : +91-22-25960329 email : [email protected] X. share Transfer system The share transfer requests received for physical shares at the Registrar and share Transfer Agents will be processed and delivered within a month from the date of lodgement, if the documents are complete in all respects. Requests for dematerialisation / rematerialisation of shares are processed and
confirmation given to the depositories within 15 days from the date of receipt in order to expedite the process of share transfers, the board has delegated the powers to shareholders’ / investors’ Grievance committee comprising of the Managing director and non-executive director, who shall attend to the share transfer formalities on a periodical basis to ensure that the transfer requests are processed in time. The committee will also consider requests received for transmission of shares, issue of duplicate certificates and split / consolidation of certificates
XI. distribution of shareholding as on March 31, 2012 number of equity share holdings 1-5000 5001-10000 10001-20000 20001-30000 30001- 40000 40001- 50000 50001-100000 100001 & above total number of shareholders 42,953 865 475 189 97 65 155 255 45,054 percentage of shareholders 95.34 1.92 1.05 0.42 0.22 0.14 0.34 0.57 100.00 no. of shares 33,66,684 6,76,838 7,12,131 4,84,349 3,44,428 3,04,577 11,45,849 18,72,32,876 19,42,67,732 percentage of shares 1.73 0.35 0.36 0.25 0.18 0.16 0.59 96.38 100.00
XII. shareholding pattern as on March 31, 2012 sr. no 1 2 3 4 5 6 7 8 9 category promoter Holding promoter Group Holding Mutual funds financial institutions / banks foreign institutional investors/ foreign venture capital bodies corporate foreign bodies corporate nRi individuals total no. of shares 13,50,00,000 57,63,003 67,37,434 6,28,392 61,92,763 91,93,339 1,68,37,028 4,43,491 1,34,72,282 19,42,67,732 percentage 69.49 2.97 3.47 0.32 3.19 4.73 8.67 0.23 6.93 100.00
56
sAfe
solid
susTAinAble
That’s iTnl for you
02 | coRpoRATe oveRview
20 | sTRATeGic Review
32 | sTATuToRY RepoRTs Report on corporate Governance
59 | finAnciAls
XIII. dematerialisation of shares as on March 31, 2012 The shares of the company are compulsorily traded in electronic mode and are available for trading with both the depositories in india namely, national securities depository limited and central depository services (india) limited. As on March 31, 2012, 19,42,65,630 shares representing 99.99% of the company’s total paid-up share capital (including 72.46% held by the promoter & promoter Group) were held in dematerialised mode XIV. unclaimed shares under ipo The details of the shares remaining unclaimed and lying in the escrow Account of the company are given below: particulars (i) (ii) (i) (ii) (i) (ii) number of shareholders at the beginning of the year number of outstanding shares in the suspense account at the beginning of the year number of shareholders who approached the company and to whom shares were transferred from suspense account during the year number of shares transferred from the suspense account during the year number of shareholders at the end of the year number of outstanding shares in the suspense account at the end of the year details 36 1,877 22 1,221 14 656
The voting rights on these shares shall remain frozen till the rightful owner of such shares claim the shares XV. The company has not issued any GdR/AdR warrants or any other convertible instruments XVI. The company does not have any manufacturing plant XVII. Address for correspondence: IL&fs transportation networks Limited Registered office: The il&fs financial centre, c-22, G-block, bandra – Kurla complex, bandra (east), Mumbai 400 051 Telephone: + 91 22 26533333 fax: + 91 22 26523979 email: [email protected] Link Intime India private Limited Registrar & share Transfer Agent c-13, pannalal silk Mills compound, l.b.s Marg, bhandup (west), Mumbai 400 078 Telephone no: +91-22-25960320 fax: +91-22-25960329 email: [email protected]
57
Transportation
AnnuAl RepoRT 2011-12
DeclaRation RegaRDing coMPliance by boaRD MeMbeRs anD senioR ManageMent PeRsonnel with the coMPany’s coDe of conDuct
The company has adopted a code of conduct for the board of directors and the employees of the company. The code has been circulated to all the members of the board of directors and the employees of the company, which is also put on the company’s website: www.itnlindia.com i hereby confirm that the company has in respect of the financial year ended March 31, 2012 received from all the members of the board of directors and the senior Management personnel a declaration of compliance with the code of conduct of the company as applicable to them for il&fs Transportation networks limited K Ramchand Managing director
Mumbai, May 2, 2012
auDitoRs’ ceRtificate
To The Members of Il&fs transportation networks Limited we have examined the compliance of conditions of corporate governance by il&fs TRAnspoRTATion neTwoRKs liMiTed (“the company”) for the year ended on March 31, 2012 as stipulated in clause 49 of the listing Agreements of the company with the stock exchanges. The compliance of conditions of corporate governance is the responsibility of the Management. our examination was limited to procedures and implementation thereof, adopted by the company for ensuring compliance of the conditions of corporate governance. it is neither an audit nor an expression of opinion on the financial statements of the company. in our opinion and to the best of our information and according to the explanations given to us, we certify that the company has complied with the conditions of corporate governance as stipulated in the above mentioned listing Agreements. we further state that such compliance is neither an assurance as to the future viability of the company nor the efficiency or effectiveness with which the Management has conducted the affairs of the company.
for deloiTTe HAsKins & sells chartered Accountants (Registrationno.117366w) Kalpesh J. Mehta partner (Membership no. 48791)
bengaluru, May 4, 2012
58
sAfe
solid
susTAinAble
That’s iTnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Auditors’ Report
IL&Fs Transportation Networks Limited
To The members of IL&fs TrANsPorTATIoN NeTWorKs LImITeD 1. we have audited the attached Balance Sheet of il&FS tranSportation networKS liMiteD (“the company”) as at March 31, 2012, the Statement of profit and loss and the cash Flow Statement of the company for the year ended on that date, both annexed thereto. these financial statements are the responsibility of the company’s Management. our responsibility is to express an opinion on these financial statements based on our audit 2. we conducted our audit in accordance with the auditing standards generally accepted in india. those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. an audit includes examining, on a test basis, evidence supporting the amounts and the disclosures in the financial statements. an audit also includes assessing the accounting principles used and the significant estimates made by the Management, as well as evaluating the overall financial statement presentation. we believe that our audit provides a reasonable basis for our opinion 3. as required by the companies (auditor’s report) order, 2003 (caro) issued by the central government in terms of Section 227(4a) of the companies act, 1956, we give in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said order 4. Further to our comments in the annexure referred to in paragraph 3 above, we report that: (i) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit; (ii) in our opinion, proper books of account as required by law have been kept by the company so far as it appears from our examination of those books; (iii) the Balance Sheet, the Statement of profit and loss and the cash Flow Statement dealt with by this report are in agreement with the books of account;
(iv) in our opinion, the Balance Sheet, the Statement of profit and loss and the cash Flow Statement dealt with by this report are in compliance with the accounting Standards referred to in Section 211(3c) of the companies act, 1956; (v) in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the companies act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in india: (a) in the case of the Balance Sheet, of the state of affairs of the company as at March 31, 2012; (b) in the case of the Statement of profit and loss, of the profit of the company for the year ended on that date and (c) in the case of the cash Flow Statement, of the cash flows of the company for the year ended on that date 5. on the basis of the written representations received from the Directors as on March 31, 2012 taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2012 from being appointed as a director in terms of Section 274(1)(g) of the companies act, 1956
For DeLoITTe hAsKINs & seLLs chartered accountants (Firm registration no. 117366w) Kalpesh J. Mehta partner Bengaluru, May 4, 2012 (Membership no. 48791)
59
transportation
annual report 2011-12
ANNEXURE TO THE AUDITORS’ REPORT
(referred to in paragraph 3 of our report of even date) (i) Having regard to the nature of the company’s business/activities/results, clauses (ii), (x), (xii), (xiii), (xiv), (xviii), (xix) and (xx) of caro are not applicable to the company (ii) in respect of its fixed assets: (a) the company has maintained proper records showing full particulars, including quantitative details and situation of the fixed assets (b) the fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. according to the information and explanation given to us, no material discrepancies were noticed on such verification (c) the fixed assets disposed during the year, in our opinion, do not constitute a substantial part of the fixed assets of the company and such disposal has, in our opinion, not affected the going concern status of the company (iii) in respect of loans, secured or unsecured, granted by the company to companies, firms or other parties covered in the register maintained under Section 301 of the companies act, 1956, according to the information and explanations given to us: (a) the company has granted unsecured loans aggregating ` 12,564.48 million to thirteen parties during the year. at the year-end, the outstanding balances of such loans aggregated ` 8,893.34 million to fourteen parties and the maximum amount involved during the year was ` 11,842.58 million to fourteen parties (b) the rate of interest and other terms and conditions of such loans are, in our opinion, prima facie, not prejudicial to the interests of the company (c) the receipts of principal amounts and interest have been regular during the year (d) there are no overdue amounts over ` 0.10 million remaining outstanding as at March 31, 2012 in respect of loans, secured or unsecured, taken by the company from companies, firms or other parties covered in the register maintained under Section 301 of the companies act, 1956, according to the information and explanations given to us: (a) the company has taken unsecured loans aggregating ` 800 million from one party during the year. at the year-end, the outstanding balances of such loans aggregated ` 700 million from one party and the maximum amount involved during the year was ` 2,450 million from three parties (b) the rate of interest and other terms and conditions of such loans are, in our opinion, prima facie, not prejudicial to the interests of the company (c) the payments of principal amounts and interest in respect of such loans have been regular / as per stipulations during the year (iv) in our opinion and according to the information and explanations given to us, having regard to the explanations that some of the items purchased are of special nature and suitable alternative sources are not readily available for obtaining comparable quotations, there is an adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchases of fixed assets and the sale of services. During the course of our audit, we have not observed any major weakness in such internal control system (v) to the best of our knowledge and belief and according to the information and explanations given to us, there were no contracts or arrangements referred to in Section 301 of the companies act, 1956 that needed to be entered in the register maintained under the said Section. accordingly, sub-clause (b) of clause (v) of paragraph 4 of caro is not applicable to the company (vi) according to the information and explanations given to us, the company has not accepted any deposit from the public during the year within the meaning of Sections 58a & 58aa or any other relevant provisions of the companies act, 1956 (vii) in our opinion, the internal audit functions carried out during the year by a firm of chartered accountants appointed by the Management have been commensurate with the size of the company and the nature of its business
60
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
(viii) we have broadly reviewed the cost records maintained by the company pursuant to the companies (cost accounting records) rules, 2011 prescribed by the central government under Section 209(1)(d) of the companies act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. we have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete (ix) according to the information and explanations given to us in respect of statutory dues: (a) the company has generally been regular in depositing undisputed dues relating to provident Fund, income-tax, wealth tax, Sales tax, Service tax and other material statutory dues applicable to it with the appropriate authorities during the year (b) there were no undisputed amounts payable in respect of income-tax, wealth tax and other material statutory dues in arrears as at March 31, 2012 for a period of more than six months from the date they became payable (c) there were no disputed dues as regards incometax, wealth tax, Sales tax and Service tax that have not been deposited as at the year end (x) in our opinion and according to the information and explanations given to us, the company has not defaulted in the repayment of dues to banks and financial institutions
(xi) in our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the company for loans taken by others from banks and financial institutions are not, prima facie, prejudicial to the interests of the company (xii) in our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained (xiii) in our opinion and according to the information and explanations given to us, and on an overall examination of the Balance Sheet, we report that ` 5,239 million raised on short-term basis have been used during the year for long- term investment (xiv) to the best of our knowledge and according to the information and explanations given to us, no fraud by the company and no fraud on the company has been noticed or reported during the year
For DeLoITTe hAsKINs & seLLs chartered accountants (Firm registration no. 117366w) Kalpesh J. Mehta partner (Membership no. 48791)
Bengaluru, May 4, 2012
61
transportation
annual report 2011-12
Balance sheet
Particulars eQUITY AND LIAbILITIes shArehoLDers' fUNDs (a) Share capital (b) reserves and surplus NoN-CUrreNT LIAbLITIes (a) long-term borrowings (b) Deferred tax liabilities (net) (c) other long term liabilities
as at 31.03.2012
` in million Note As at March 31, 2012 As at March 31, 2011
2 3
1,942.68 17,495.41
19,438.09
1,942.68 15,904.97
17,847.65
4 7 8
4,000.00 21.22 2,610.80
6,632.02
3,750.00 26.64 3,704.14
7,480.78
CUrreNT LIAbILITIes (a) current maturities of long-term debt (b) Short-term borrowings (c) trade payables (d) other current liabilities (e) Short-term provisions ToTAL AsseTs NoN CUrreNT AsseTs (a) Fixed assets (net) (i) tangible assets (ii) intangible assets (b) non-current investments (c) long-term loans and advances (d) other non-current assets CUrreNT AsseTs (a) trade receivables (b) cash and cash equivalents (c) Short-term loans and advances (d) other current assets ToTAL notes 1 to 37 form part of the financial statements
5 6 11 9 10
8,500.00 14,760.60 4,468.10 5,460.61 1,144.41
34,333.72 60,403.83
6,100.00 9,090.86 2,885.72 4,080.12 1,044.42
23,201.12 48,529.55
12 142.83 158.76 25,145.90 14,243.90 1,021.28 142.45 225.52 21,083.96 11,449.55 420.29
13 14 16
40,712.67
33,321.77
18 19 15 17
9,939.56 40.78 8,551.74 1,159.08
19,691.16 60,403.83
8,386.84 75.58 6,038.23 707.13
15,207.78 48,529.55
in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 62
SaFe SoliD SuStainaBle that’s itnl for you
Bengaluru, May 4, 2012
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
statement of Profit and Loss
Particulars Note
for the Year Ended March 31, 2012
` in million Year ended March 31, 2012 27,725.82 1,376.64 29,102.46 Year ended March 31, 2011 16,158.03 851.77 17,009.80
I) II) III)
reveNUe from oPerATIoNs oTher INCome ToTAL reveNUe (I + II)
23 24
Iv) exPeNses operating expenses employee benefits expense Finance costs Depreciation and amortization expense administrative and general expenses ToTAL exPeNses v) ProfIT before TAxATIoN (III-Iv) 25 26 27 12 28 20,471.91 631.31 2,656.34 105.69 1,100.73 24,965.98 4,136.48 9,532.34 512.01 1,555.03 98.13 794.90 12,492.41 4,517.39
vI) TAx exPeNse: (1) current tax (2) tax relating to earlier year (3) Deferred tax (net) vI) ToTAL TAx exPeNses (vI) vII) ProfIT for The YeAr (v - vI) earnings per equity share (Face value per share `10/-): (1) Basic (2) Diluted notes 1 to 37 form part of the financial statements 33 12.99 12.99 14.83 14.83 1,600.76 4.04 8.70 1,613.50 2,522.98 1,612.27 24.76 1,637.03 2,880.36
in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 Bengaluru, May 4, 2012 63
transportation
annual report 2011-12
Cash Flow statement
for the Year Ended March 31, 2012
` in million Year Ended March 31, 2012 CAsh fLoW from oPerATINg ACTIvITIes profit Before tax Adjustments for interest income profit on sale of unquoted long term investments provisions written back employee benefits (net) profit on sale of fixed assets (net) Depreciation and amortization expense amortisation of premium on forward contract unrealised exchange loss on forward contract Finance costs write back of provision for doubtful debts / advances Dividend income on non-current investments provision for diminution in the value of investments operating profit before Working Capital Changes increase in trade receivables (current and non current) increase in other assets & loans and advances (current and non current) increase in liabilities (current and non current) Cash generated from operations Direct taxes paid (net) Net Cash generated from operating Activities (A) CAsh fLoW from INvesTINg ACTIvITIes additions to fixed assets proceeds from sale of fixed assets investment in / purchase of equity shares of subsidiaries investment in others advance towards Share application Money in subsidiaries advance towards Share application Money in others proceeds from sale of investments proceeds from redemption of Mutual Fund investments long term loans given long term loans recovered Short term loans given (net) refund of advance towards Share application Money amount refunded / (placed) as inter-corporate deposits (net) interest received Fixed deposits with original maturity exceeding 3 months encashed / (placed) (net) Dividend received Net Cash Used In Investing Activities (b) 4,136.48 (1,145.78) 1.95 (0.22) 105.69 (4.56) 30.96 2,656.34 (23.60) 110.00 5,867.26 (1,741.54) (118.83) 1,841.00 5,847.89 (1,627.83) 4,220.06 Year Ended March 31, 2011 4,517.39 (726.29) (40.09) (0.66) 1.13 (0.66) 98.13 1,555.03 (4.00) (32.51) 100.00 5,467.47 (3,626.73) (4,528.92) 7,069.21 4,381.03 (1,805.00) 2,576.03
(39.68) 0.59 (1,457.36) (1,265.72) (1,178.78) (120.00) (4,703.18) 790.12 (2,006.07) 0.05 120.00 733.11 (0.09) 23.60 (9,103.41)
(94.76) 9.18 (4,354.43) (1,532.77) (580.70) (1,016.96) 496.21 2,509.63 (980.93) (650.81) 412.25 (120.00) 573.51 1.58 23.60 (5,305.40)
64
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Cash Flow statement
for the Year Ended March 31, 2012
` in million Year Ended March 31, 2012 CAsh fLoW from fINANCINg ACTIvITIes Share issue expenses recovery of Share issue expenses proceeds from loans repayable on demand from Banks (net) proceeds from long term borrowings repayment of long term borrowings proceeds from short term borrowings repayment of short term borrowings Finance costs paid Dividend payment tax on Dividend paid Net Cash generated from financing Activities (C) Net Decrease in Cash and Cash equivalents (A+b+C) cash and cash equivalents at the beginning of the year cash and cash equivalents at the end of the year Net Decrease in Cash and Cash equivalents notes: 1. components of cash & cash equivalents cash on hand Balances with Banks in current accounts unpaid Dividend accounts Fixed deposits placed for a period exceeding 3 months but not more than 12 months cash and cash equivalents as per note 19 notes 1 to 37 form part of the financial statements 319.74 10,650.00 (8,000.00) 15,450.00 (10,100.00) (2,681.27) (679.94) (110.30) 4,848.23 (35.12) 74.35 39.23 (35.12) Year Ended March 31, 2011 (201.14) 48.66 90.86 6,350.00 (3,000.00) 13,880.00 (13,630.00) (1,481.51) (582.81) (96.80) 1,377.26 (1,352.11) 1,426.46 74.35 (1,352.11)
38.15 1.08 39.23 0.35 1.20 40.78
0.78 73.57 74.35 0.12 1.11 75.58
in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 Bengaluru, May 4, 2012 65
transportation
annual report 2011-12
Notes
I
forming part of the financial statements for the year ended March 31, 2012
NOTE 1 : SIgNIfIcANT AccOUNTINg POlIcIES
bAsIs for PrePArATIoN of fINANCIAL sTATemeNTs the financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principles in india, and the applicable accounting standards issued pursuant to the companies (accounting Standards) rules, 2006. all income and expenditure having a material bearing on the financial statements are recognised on an accrual basis II Use of esTImATes the preparation of financial statements requires the Management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) as of the date of the Financial Statements and the reported income and expenses during the reporting period. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. actual results could differ from these estimates III fIxeD AsseTs AND DePreCIATIoN/AmorTIsATIoN (a) Tangible assets and depreciation tangible fixed assets acquired by the company are reported at acquisition cost, with deductions for accumulated depreciation and impairment losses, if any the acquisition cost includes the purchase price (excluding refundable taxes) and expenses such as delivery and handling costs, installation, legal services and consultancy services, directly attributable to bringing the asset to the site and in working condition for its intended use where the construction or development of any asset requiring a substantial period of time to set up for its intended use is funded by borrowings, the corresponding borrowing costs are capitalised up to the date when the asset is ready for its intended use Depreciation on tangible fixed assets is computed as under: (i) in respect of premises, depreciation is computed on the Straight line Method at the rates provided under Schedule Xiv of the companies act, 1956 (ii) the company has adopted the Straight line Method of depreciation so as to depreciate 100% of the cost of the following type of assets at rates higher than those prescribed under Schedule Xiv to the companies act, 1956, based on the Management’s estimate of useful life of such assets: Asset Type Data processing equipments Specialised office equipments assets provided to employees Estimated Useful life 4 years 3 years 3 years
(iii) Depreciation on fixed assets, other than on assets specified in notes iii(a) (i) and (ii) above, is provided for on the written Down value Method at the rates provided under Schedule Xiv to the companies act, 1956. Depreciation is computed pro-rata from the date of acquisition of and up to the date of disposal (iv) leasehold improvement costs are capitalised and amortised on a straight-line basis over the period of lease agreement unless the corresponding rates under Schedule Xiv are higher, in which case such higher rates are used (v) all categories of assets costing less than ` 5,000 each, mobile phones and items of soft furnishings are fully depreciated in the year of purchase
66
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
(b) Intangible assets and amortisation intangible assets comprise of software and amounts paid for acquisition of commercial rights under an “operation and Maintenance” agreement of a toll road project intangible assets are reported at acquisition cost with deductions for accumulated amortisation and impairment losses, if any acquired intangible assets are reported separately from goodwill if they fulfil the criteria for qualifying as an asset, implying they can be separated or they are based on contractual or other legal rights and that their market value can be established in a reliable manner an impairment test of intangible assets is conducted annually or more often if there is an indication of a decrease in value. the impairment loss, if any, is reported in the Statement of profit and loss intangible assets are amortised on a “straight line” basis over their estimated useful lives. the estimated useful life of software is four years. the amount paid for acquisition of the rights under the “operations and Maintenance” agreement, is amortised over the minimum balance period of the concession agreement relating to the corresponding toll road project as it existed at the time of acquisition Iv ImPAIrmeNT of AsseTs the carrying values of assets of the company’s cash-generating unit are reviewed for impairment annually or more often if there is an indication of decline in value. if any indication of such impairment exists, the recoverable amounts of those assets are estimated and impairment loss is recognised, if the carrying amount of those assets exceeds their recoverable amount. the recoverable amount is the greater of the net selling price and their value in use. value in use is arrived at by discounting the estimated future cash flows to their present value based on appropriate discount factor v INvesTmeNTs (a) investments are capitalised at actual cost including costs incidental to acquisition (b) investments are classified as long term or current at the time of making such investments (c) long-term investments are individually valued at cost, less provision for diminution that is other than temporary. (d) current investments are valued at the lower of cost and market value vI reveNUe reCogNITIoN the company’s service offerings include advisory and management services, supervisory services (including as lenders’ engineers), operation and maintenance services, toll collection services for toll road projects and rendering assistance to applicant for toll road concessions with the bidding process revenue is recognised when it is realised or realisable and earned. revenue is considered as realised or realisable and earned when it has persuasive evidence of an arrangement, delivery has occurred, the sales price is fixed or determinable and collectability is reasonably assured revenue in respect of arrangements made for rendering services is recognised over the contractual term of the arrangement. in respect of arrangements, which provide for an upfront payment followed by additional payments as certain conditions are met (milestone payments), the amount of revenue recognised is based on the services delivered in the period as stated in the contract. in respect of arrangements where fees for services rendered are success based (contingent fees), revenue is recognised only when the factor(s) on which the contingent fees is based, actually occur revenue from development projects under fixed - price contracts, where there is no uncertainty as to measurement or collectability of consideration is recognised based on the milestones reached under the contracts
67
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
contract revenue and costs associated with the construction of roads is recognised as by reference to the stage of completion of the projects at the Balance Sheet date. the stage of completion of a project is determined by the proportion that the contract cost incurred for work performed up to the Balance Sheet date bears to the estimated total contract costs any excess revenue recognised in accordance with the stage of completion of the project, in comparison to the amounts billed to the clients in accordance with the milestones completed as per the respective development agreements, is carried forward as “unearned revenue” any short revenue recognised in accordance with the stage of completion of the project, in comparison to the amounts billed to the clients in accordance with the milestones completed as per the respective development agreements, is carried forward as “unbilled revenue” interest income is accrued evenly over the period of the corresponding instrument Dividend income is recognised when the unconditional right to receive the payment is established vII foreIgN CUrreNCY TrANsACTIoNs transactions in foreign currencies are translated to the reporting currency based on the exchange rate on the date of the transaction. exchange difference arising on settlement thereof during the period is recognised as income or expense in the Statement of profit and loss Foreign currency denominated cash and bank balances, receivables (other than those that are in substance the company’s net investment in a non integral foreign operation), and liabilities (monetary items) outstanding as at the period end are valued at closing-date rates, and unrealised translation differences are included in the Statement of profit and loss non monetary items (such as equity investments) denominated in foreign currencies are reported using the exchange rate as at the date of the transaction. where such items are carried at fair value, these are reported using exchange rates that existed on dates when the fair values were determined inter company receivables or payables for which settlement is neither planned nor likely to occur in the foreseeable future and are in substance an extension to or a deduction from the company’s net investments in a non - integral foreign operations are also translated at closing rates but the exchange differences arising are accumulated in the foreign currency translation reserve until disposal of the net investment, at which time they are recognised as income or expense in the Statement of profit and loss. any repayment of receivables or payables forming part of net investment in foreign operations is not considered as partial disposal of investments in foreign operations and amounts previously recognised in the foreign currency translation reserve are not adjusted until the disposal of the ownership interest occurs vIII emPLoYee beNefITs (a) short term Short term employee benefits are recognised as an expense at the undiscounted amount expected to be paid over the period of services rendered by the employees to the company (b) Long term the company has both defined-contribution and defined-benefit plans, of which some have assets in special funds or securities. the plans are financed by the company and in the case of some defined contribution plans by the company along with its employees (i) Defined-contribution plans these are plans in which the company pays pre-defined amounts to separate funds and does not have any legal or informal obligation to pay additional sums. these comprise of contributions to the employees’ 68
SaFe SoliD SuStainaBle that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
provident fund, family pension fund and superannuation fund. the company’s payments to the definedcontribution plans are reported as expenses in period in which the employees perform the services that the payment covers (ii) Defined-benefit plans expenses for defined-benefit gratuity plans are calculated as at the balance sheet date by independent actuaries in a manner that distributes expenses over the employee’s working life. these commitments are valued at the present value of expected future payments, with consideration for calculated future salary increases, using a discount rate corresponding to the interest rate estimated by the actuary having regard to the interest rate on government bonds with a remaining term that is almost equivalent to the average balance working period of employees the actuarial gains and losses are recognised immediately in the Statement of profit and loss (c) others compensated absences which accrue to employees and which can be carried to future periods but are expected to be encashed or availed in twelve months immediately following the year end are reported as expenses in the year in which the employees perform the services that the benefit covers at the undiscounted amount of the benefits after deducting amounts already paid. where there are restrictions on availment or encashment of such accrued benefit or where the availment or encashment is otherwise not expected to wholly occur in the next twelve months, the liability on account of the benefit is actuarially determined using the projected unit credit method Ix TAxes oN INCome taxes include taxes on the company’s taxable profits, adjustment attributable to earlier periods and changes in deferred taxes. taxes are determined in accordance with enacted tax regulations and tax rates in force and in the case of deferred taxes at rates that have been substantively enacted Deferred tax is calculated to correspond to the tax effect arising when final tax is determined. Deferred tax corresponds to the net effect of tax on all timing differences which occur as a result of items being allowed for income tax purposes during a period different from when they are recognised in the financial statements Deferred tax assets are recognised with regard to all deductible timing differences to the extent that it is probable that taxable profit will be available in future against which deductible timing differences can be utilised when the company carries forward unused tax losses and unabsorbed depreciation, deferred tax assets are recognised only to the extent there is virtual certainty backed by convincing evidence that sufficient future taxable income will be available against which deferred tax assets can be realised the carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced by the extent that it is no longer probable that sufficient taxable profit will be available to allow all or a part of the aggregate deferred tax asset to be utilised x LeAse ACCoUNTINg leases of assets where the lessor retains substantially all the risks and benefits of ownership of the assets are classified as operating leases. operating lease payments are recognised as an expense in the Statement of profit and loss on a straight line basis over the lease term. any compensation, according to agreement, that the lessee is obliged to pay to the lessor if the leasing contract is terminated prematurely is expensed during the period in which the contract is terminated
69
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
xI ProvIsIoNs, CoNTINgeNT LIAbILITIes AND CoNTINgeNT AsseTs a provision is recognised when the company has a present obligation as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. provisions (excluding employee benefits) are not discounted to their present value and are determined based on best estimates required to settle the obligation at the Balance Sheet date. these are reviewed at each balance sheet date and adjusted to reflect the current best estimates. contingent liabilities are not recognised but are disclosed in the notes to the financial statement. a contingent asset is neither recognised nor disclosed xII segmeNT rePorTINg the accounting policies adopted for segment reporting are in accordance with the accounting policy of the company. Segment revenue, expenses, assets and liabilities have been identified to segments on the basis of their relationship to the operating activities of the Segment. revenues, expenses, assets and liabilities, which relate to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under “unallocated revenue / expenses / assets / liabilities” xIII borroWINg CosTs Borrowing costs are recognised in the period to which they relate, regardless of how the funds have been utilised, except where it relates to the financing of construction or development of assets requiring a substantial period of time to prepare for their intended future use. Borrowing costs are capitalised up to the date when the asset is ready for its intended use. the amount of borrowing costs capitalised (gross of tax) for the period is determined by applying the interest rate applicable to appropriate borrowings outstanding during the period to the average amount of accumulated expenditure for the assets during the period xIv CAsh AND CAsh eQUIvALeNTs cash comprises of cash on Hand, cheques on Hand and demand deposits with Banks. cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risks of changes in value xv CAsh fLoW sTATemeNT the cash Flow Statement is prepared in accordance with the “indirect Method” as explained in the accounting Standard (aS) 3 on cash Flow Statements xvI eArNINgs Per shAre Basic earnings per share is calculated by dividing the net profit after tax for the period attributable to equity shareholders of the company by the weighted average number of equity shares in issue during the period Diluted earnings per share is calculated by dividing the net profit after tax for the period attributable to equity shareholders of the company by the weighted average number of equity shares determined by assuming conversion on exercise of conversion rights for all potential dilutive securities xvII DerIvATIve TrANsACTIoNs premium paid on option contracts acquired is treated as an asset until maturity. premium received on option contracts written is treated as liability until maturity. in case of Forward exchange contracts which are not intended for trading or speculation purposes, the premium or discount arising at the inception of such a forward exchange contract is amortised as expense or income over the life of the contract. exchange differences on such a contract are recognised in the Statement of profit and loss in the reporting period in which the exchange rates change. any profit or loss arising on cancellation or renewal of such a forward exchange contract is recognised as income or as expense for the period
70
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 2 : SHARE cAPITAl
As at March 31, 2012 Number of Shares ` in million As at March 31, 2011 Number of Shares ` in million
Particulars
Authorised equity Shares of ` 10/- each Issued equity Shares of ` 10/- each subscribed and Paid up equity Shares of ` 10/- each fully paid (refer foot note no. i, ii and iii) ToTAL fooT NoTes: i) reconciliation of the number of equity shares outstanding at the beginning and at the end of the reporting period : Year ended March 31, 2012 Number of Shares Shares outstanding at the beginning of the year Shares issued during the year Shares bought back during the year Shares outstanding at the end of the year 194,267,732 194,267,732 ` in million 1,942.68 1,942.68 Year ended March 31, 2011 Number of Shares 194,267,732 194,267,732 ` in million 1,942.68 1,942.68 194,267,732 194,267,732 194,267,732 1,942.68 1,942.68 1,942.68 194,267,732 194,267,732 194,267,732 1,942.68 1,942.68 1,942.68 250,000,000 2,500.00 250,000,000 2,500.00
Particulars
ii) Shareholding more than 5% of issued, subscribed and paid up equity share capital As at March 31, 2012 Shareholder il&FS il&FS employees welfare trust ToTAL * Number of Shares 135,000,000 135,000,000 % of total holding 69.49% 69.49% As at March 31, 2011 Number of Shares 135,000,000 10,867,769 145,867,769 % of total holding 69.49% 5.59% 75.08%
not applicable* not applicable*
the number of shares held by il&FS employees welfare trust as at March 31, 2012 do not represent 5% or more of the total holding and hence, the disclosure of number of shares and percentage of total holding as at March 31, 2012 have not been given thereof
iii) of the above 135,000,000 (as at March 31, 2011 : 135,000,000) shares are held by the holding company viz. infrastructure leasing & Financial Services limited (“il&FS”) and 2,440,534 (as at March 31, 2011 : nil) shares are held by a fellow subsidiary viz. il&FS Financial Services limited
71
transportation
annual report 2011-12
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 3 : RESERvES AND SURPlUS
As at March 31, 2012 10,320.57 715.52 252.30 52.53 (29.41) 23.12 4,816.35 2,522.98 252.30 777.07 126.06 6,183.90 17,495.41 3,014.27 2,880.36 288.04 679.94 110.30 967.82 427.48 288.04 52.53 -
` in million As at March 31, 2011 10,320.57
(a) securities Premium Account (b) general reserve opening balance (+) current year transfer (-) written back in current year (c) foreign Currency translation reserve (refer Note vII of Note 1) opening Balance (-) Foreign exchange translation loss (net of deferred tax of ` 14.12 million (previous year ` nil)) closing Balance (d) surplus in the statement of Profit and Loss opening balance (+) profit for the year (-) transfer to general reserve (-) provision for proposed dividend (refer note no. 21) (-) provision for Dividend Distribution tax on proposed dividend closing Balance ToTAL
715.52
52.53
4,816.35 15,904.97
NOTE 4 : lONg-TERM BORROwINgS
Particulars unsecured term loans from Banks (refer foot note no.1) ToTAL 4,000.00 4,000.00 As at March 31, 2012
` in million As at March 31, 2011 3,750.00 3,750.00
fooT NoTes: No. 1: i) terms of repayment and rate of interest for long term borrowings outstanding as on March 31, 2012 As at March 31, 2012 Name of Bank State Bank of travancore Bank of Baroda South indian Bank Bank of india ToTAL ` in million 500.00 2,000.00 1,000.00 500.00 4,000.00 Terms of repayment Bullet repayment Bullet repayment Bullet repayment Bullet repayment Due Date for Repayment March 22, 2014 March 21, 2014 December 9, 2013 august 25, 2013
72
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
terms of repayment and rate of interest for long term borrowings outstanding as on March 31, 2011 As at March 31, 2011 Name of Bank Bank of india punjab and Sind Bank limited punjab and Sind Bank limited united Bank of india South indian Bank punjab and Sind Bank limited Bank of india ToTAL ` in million 500.00 500.00 625.00 500.00 500.00 625.00 500.00 3,750.00 Terms of repayment Bullet repayment Bullet repayment Bullet repayment Bullet repayment Bullet repayment Bullet repayment Bullet repayment Due Date for Repayment august 25, 2013 March 25, 2013 March 22, 2013 December 29, 2012 December 7, 2012 September 25, 2012 august 25, 2012
NOTE 5 : cURRENT MATURITIES Of lONg-TERM DEBT
Particulars unsecured from Banks ToTAL As at March 31, 2012 8,500.00 8,500.00
` in million As at March 31, 2011 6,100.00 6,100.00
NOTE 6 : SHORT-TERM BORROwINgS
Particulars (a) secured loans repayable on demand from Banks (Secured by First pari passu charge over current assets and receivables) (b) Unsecured (i) short term loans From Banks From other parties (ii) Loans and advances from related parties ToTAL 12,650.00 1,000.00 700.00 14,760.60 410.60 As at March 31, 2012
` in million As at March 31, 2011 90.86
7,300.00 1,700.00 9,090.86
73
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 7 : DEfERRED TAX lIABIlITIES (NET)
the company has a net deferred tax liability of ` 21.22 million (as at March 31, 2011 : ` 26.64 million). the components are as under (refer foot notes 1 and 2): ` in million Particulars in respect of depreciation in respect of employee benefits in respect of provision for doubtful debts DeferreD TAx LIAbILITIes (NeT) fooT NoTe: 1) the company has not recognised any deferred tax asset against provision created for diminution in value of investments in absence of virtual certainty of future taxable capital gains against which the deferred tax asset could be offset 2) Deferred tax charge (net) during the year includes deferred tax charge of ` 14.12 million on account of deferred tax liability created during the year which has been directly adjusted against Foreign currency translation reserve recognised in respect of the foreign exchange translation differences on the company’s receivables which are regarded as an extension to the company’s net investments in a foreign entity and have not been included above As at March 31, 2011 38.28 (9.65) (1.99) 26.64 Movement during the year (refer foot note 2) (7.92) 1.48 1.02 (5.42) As at March 31, 2012 30.36 (8.17) (0.97) 21.22
NOTE 8 : OTHER lONg TERM lIABIlITIES
Particulars (a) retention money payable (b) Mobilisation advances received (b) option premium liabilities (refer note no. 22) ToTAL As at March 31, 2012 735.90 1,758.81 116.09 2,610.80
` in million As at March 31, 2011 318.55 3,269.50 116.09 3,704.14
NOTE 9 : OTHER cURRENT lIABIlITIES
Particulars (a) interest accrued but not due on borrowings (b) Mobilisation advances received (c) unearned revenue (refer note no. 29) (d) unpaid dividends (e) other payables (refer foot note below) ToTAL As at March 31, 2012 24.77 3,741.19 1,361.94 0.35 332.36 5,460.61
` in million As at March 31, 2011 49.70 2,413.24 1,420.19 0.12 196.87 4,080.12
fooT NoTe other payables includes deferred premium on forward contract of ` 31.53 million (as at March 31, 2011 : ` nil) and statutory dues payable of ` 300.83 million (as at March 31, 2011 : ` 196.87 million)
74
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 10 : SHORT-TERM PROvISIONS
As at March 31, 2012 235.17 777.07 126.06 6.11 1,144.41
` in million As at March 31, 2011 253.70 679.94 110.30 0.48 1,044.42
(a) provision for employee benefits (net) (refer foot note no. 2(b) of note 26) (b) others provision for proposed dividend provision for dividend distribution tax provision for tax (net) ToTAL
NOTE 11 : TRADE PAYABlES
according to the records available with the company, there were no dues to Micro and Small enterprises as defined under the Micro, Small and Medium enterprises Development act 2006. Hence, no disclosures are to be given in respect thereof
75
76 ` in million gross Block (at cost) Accumulated Depreciation and Amortisation Net Block Net Block
NOTE 12 : fIXED ASSETS
Notes
SaFe
SoliD
Balance Balance Balance Balance Balance Balance Depreciation as at Deletions / as at as at Deletions / as at as at as at Additions charge April 1, Adjustments March 31, April 1, Adjustments March 31, March 31, March 31, for the year 2011 2012 2011 2012 2012 2011
transportation
SuStainaBle
a 3.71 1.31 21.90 5.77 5.53 38.22 (1.73) 255.69 76.75 37.47 (1.36) 12.45 3.66 4.52 36.30 17.04 5.79 (0.31) 28.51 12.59 4.01 (0.29) 16.31 22.83 8.18 112.86 (1.42) 82.90 20.69 14.12 (1.07) 33.74 16.71 9.17 1.92 11.09 63.86 12.75 6.87 19.62 44.24 5.62 49.16 12.20 13.47 4.27 142.83 14.96 0.85 0.24 1.09 13.87
Tangible Assets 14.11 47.40 6.23 41.73 10.46 13.73 8.79 142.45
Buildings
14.96
plant and Machinery
60.15
forming part of the financial statements for the year ended March 31, 2012
that’s itnl for you
Furniture and fixtures
15.40
vehicles
62.42
office equipments
23.05
Data processing equipments
30.77
leasehold improvements
12.45
(operating lease)
ToTAL
219.20
b Intangible Assets 1.46 1.46 39.68 95.43 (11.70) 544.15 (1.73) 582.10 176.18 81.20 326.41 99.43 266.41 60.00 85.13 14.30 65.57 2.65 68.22 105.69 98.13 (1.36) (3.15) 150.70 16.95 167.65 280.51 176.18 115.71 43.05 158.76 301.59 367.97 179.82 45.70 225.52 367.97
computer software (acquired) commercial rights (acquired) (refer Foot note no.1)
264.95 60.00
ToTAL
324.95
grAND ToTAL
544.15
As AT mArCh 31, 2011
460.42
fooT NoTe: 1) During the year 2006-07, the company incurred a cost of ` 60.00 million for acquiring commercial rights under the “operations and Maintenance” agreement (“o&M contract”) for one of the road projects from the erstwhile contractor. under the terms of the o&M contract, the company is entitled to routine maintenance price and the operation price for maintaining and operating the project. the company expects benefits under the o&M contract to accrue until the end of the concession period which is not expected to be earlier than May 12, 2029. accordingly, the expenditure incurred by the company for acquisition of the rights is treated as an intangible asset and is being amortised on a straight line basis over the minimum balance period of the concession i.e. 22 years and 7 months (from the date of acquisition of the said commercial rights)
annual report 2011-12
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 13 : NON-cURRENT INvESTMENTS
` in million As at March 31, 2012 21,013.34 804.40 1,106.40 1,693.00 1,038.76 25,655.90 510.00 25,145.90 As at March 31, 2011 18,427.12 583.90 786.40 648.00 1,038.54 21,483.96 400.00 21,083.96
TrADe INvesTmeNTs (refer A beLoW) (a) investments in equity shares (b) investments in preference shares (c) investments in debentures (d) investments in covered warrants (e) investments in units sUb- ToTAL less : provision for diminution in the value of investments ToTAL
A. DETAIlS Of TRADE INvESTMENTS (REfER fOOT NOTES NO.1 TO 6)
As at March 31, 2012 Sr. Name of the Entity No. Quantity face value per unit (`) ` in million As at March 31, 2011 Quantity face value per unit (`) ` in million
(a)
Investment in equity shares subsidiaries (Unquoted; fully paid - At Cost) gujarat road and infrastructure company limited north Karnataka expressway limited east Hyderabad expressway limited itnl international pte. limited (nominal value uS$ 1 each) itnl road infrastructure Development company limited elsamex S.a. (nominal value euro 60.10121 each) (refer Foot note no.2) vansh nimay infraprojects limited (refer Foot note no.3) il&FS rail limited (Formerly Known as itnl enso rail Systems limited) Hazaribagh ranchi expressway limited pune Sholapur road Development company limited west gujarat expressway limited Moradabad Bareilly expressway limited Jharkhand road projects implementation company limited chenani nashri tunnelway limited Mp Border checkposts Development company limited Badarpur tollway operations Management limited rapid Metrorail gurgaon limited
76,542,250 7,720,823 21,689,400
10
442.50 77.21 216.89 1,340.15 400.00 2,722.34 145.00 1,164.09 0.37
76,542,250 7,720,823 21,689,400
10
442.50 77.21 216.89 1,340.15 400.00 2,722.34 92.00 448.50 0.37 1,600.00 98.00 2,216.60 1,531.65 3,475.90 0.26 0.50 0.27
10 10 not 28,050,001 applicable 40,000,000 10 not applicable 14,300,000 10 260,949 82,109,960 37,000 160,000,000 14,799,985 221,660,000 153,165,000 372,000,000 25,500 49,994 27,083 10 10 10 10 10 10 10 10 10 10
10 10 not 28,050,001 applicable 40,000,000 10 not applicable 9,000,000 10 260,949 44,850,000 37,000 10 10 10 10 10 10 10 10 10 10
1,600.00 160,000,000 100.50 9,800,000 2,216.60 221,660,000 2,280.90 153,165,000 3,720.00 347,590,000 83.52 25,500 0.50 0.27 49,994 27,083
77
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
As at March 31, 2012 Sr. Name of the Entity No. Quantity face value per unit (`) 10 ` in million
As at March 31, 2011 Quantity face value per unit (`) 10 10 10 ` in million
Futureage infrastructure india limited 3,000,000 30.00 (Formerly Known as global parking plaza limited) charminar robopark limited 50,000 10 3.00 Karyavattom Sports Facilities limited 49,940 10 0.50 Kiratpur ner chowk expressway limited 8,550,000 10 85.50 itnl offshore pte. ltd. (nominal value not 50,000 2.61 uS$ 1 each) applicable Joint ventures (fully paid - At Cost) Jorabat Shillong expressway limited 21,000,000 10 210.00 21,000,000 (unquoted) naM expressway limited (unquoted) 116,754,970 10 1,167.55 116,754,970 noida toll Bridge company limited 47,195,007 10 1,871.58 47,195,007 (Quoted) Associates (Unquoted; fully paid - At Cost) thiruvananthapuram road 17,030,000 10 170.30 17,030,000 Development company limited andhra pradesh expressway limited 16,513,060 10 165.13 16,513,060 itnl toll Management Services limited 24,500 10 0.25 24,500 warora chandrapur Ballarpur toll road 61,708,490 10 617.08 17,490 limited others (Unquoted; fully paid - At Cost) 179.00 12,000,000 pipavav railway corporation limited 12,000,000 10 sUb-ToTAL (A) 21,013.34 (b) Investments in Preference shares in subsidiaries (Unquoted; fully paid At Cost) west gujarat expressway limited 20,000,000 10 296.90 20,000,000 (refer Foot note no.5) rapid Metrorail gurgaon limited 507.50 28,700,000 50,750,000 10 (refer Foot note no.6) sUb-ToTAL (b) 804.40 (c) Investments in Debentures (Unquoted; fully paid - At Cost) 5% optionally convertible debentures 7,864,000 100 786.40 7,864,000 of andhra pradesh expressway limited (associate) 11.50% non-convertible debentures 32,000,000 10 320.00 of road infrastructure Development company of rajasthan limited sUb-ToTAL (C) 1,106.40 (d) Investments in Covered Warrants (Unquoted; fully paid - At Cost) infrastructure leasing & Financial Services 169,300,000 10 1,693.00 64,800,000 limited (refer Foot note no.4) (d) (e) Investments in Units (Unquoted; fully paid - At Cost) itnl road investment trust (a 1,038,762 1000 1,038.76 1,038,541 Subsidiary) (e) grAND ToTAL (A+b+C+D+e) 25,655.90
210.00 1,167.55 1,871.58
10 10 10 10 10
170.30 165.13 0.25 0.17 179.00 18,427.12
10 10
296.90 287.00 583.90
100
786.40
-
786.40
10
648.00
1000
1,038.54 21,483.96
78
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
` in million As at March 31, 2012 1,871.58 23,784.32 25,655.90 As at March 31, 2011 1,871.58 19,612.38 21,483.96
aggregate cost of quoted investments (Market value of ` 1,057.70 million; as at March 31, 2011 : ` 1,250.67 million) aggregate cost of unquoted investments ToTAL foot Notes 1
the company has given non-disposal undertakings to the lenders and / or equity investors of certain infrastructure companies promoted by it with regard to its investments in the equity share capital of these companies as a part of promoter’s undertaking to such lenders and / or equity investors. also, the company has given non-disposal undertakings to the grantors of the concession to certain infrastructure companies promoted by the company with regard to its investments in the equity share capital of these companies the company has pledged 171,959 (as at March 31, 2011-171,959) equity shares representing 51% of the overall shareholding in elsamex S.a., in favour of certain lenders for a term loan facility availed by elsamex S.a. the company has pledged 14,300,000 (as at March 31, 2011-9,000,000) shares of vansh nimay infraprojects limited (“Borrower”) with il&FS trust company limited (“Security trustee”) to secure the dues of the Borrower including without limitation all principal amounts, interest expenses, penalties, costs, fees, etc payable by the Borrower in relation to the facility extended by the consortium of Financial institutions and Banks under the pooled Municipal Debt obligation Facility (“pMDo”) the company’s investment in “covered warrants” aggregating to ` 1,693.00 million (as at March 31, 2011 ` 648.00 million) issued by infrastructure leasing & Financial Services limited (“il&FS”) are variable interest debt instruments under which the holder is entitled to a proportionate share of the dividend, if any, declared by road infrastructure Development company of rajasthan limited (“riDcor”), Jharkhand accelerated road Development company limited (“JarDcl”), chhatisgarh Highways Development company limited (“cHDcl”) and Jharkhand road projects implementation company limited (“Jrpicl”) on the equity shares held by il&FS as well as the interest granted by riDcor on the Fully convertible Debentures (“FcDs”) held by il&FS. However, the company is not entitled to rights and privileges, which il&FS enjoys as a shareholder / debentureholder. the instruments are unsecured the company’s investment in redeemable / optionally convertible cumulative preference shares of west gujarat expressway limited (“wgel”) are convertible, at the option of the company, into 1 equity share and carry a coupon of 2% per annum, accrued annually in arrears (“coupon”). an additional coupon consisting of 95% of the balance distributable profits, that may be available with wgel after it has met all other obligations, would accrue on the said preference shares (“additional coupon”) the company’s investments in compulsorily convertible preference shares of rapid Metrorail gurgaon limited are fully and compulsorily convertible into equity shares within 90 days from achieving the commercial operation date of the project
2 3
4
5
6
79
transportation
annual report 2011-12
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 14 : lONg-TERM lOANS AND ADvANcES (UNSEcURED, cONSIDERED gOOD)
As at March 31, 2012 3.19 54.69 5,151.37 2,503.30 7,654.67 101.68 4,479.27 269.80 1,680.60 14,243.90
` in million As at March 31, 2011 6.72 42.15 1,888.20 2,452.18 4,340.38 108.91 5,364.85 469.80 1,116.74 11,449.55
a. Capital Advances advance towards fixed assets b. security Deposits c. Loans and advances to related parties long term loans advance towards Share application Money (refer foot note) sUb-ToTAL (C.) d. prepaid expenses e. preconstruction and Mobilisation advances paid to contractors (refer foot note 2 of note 15) f. advance towards Share application Money g. loans to others ToTAL foot Note
as required under the restructuring package of gujarat road and infrastructure company limited (“gricl”), approved by the corporate Debt restructuring cell on June 17, 2004, the company as one of the promoters of gricl advanced ` 600.00 million towards preference Share capital. out of the above advance, ` 150.00 million was to be applied against issue of 1% non cumulative convertible preference Shares and ` 450.00 million against issue of 8% redeemable convertible preference Shares. gricl proposes to convert this advance into subordinated debt. pending completion of the process for the conversion, the company has classified the amount as “advance towards Share application Money”
NOTE 15 : SHORT-TERM lOANS AND ADvANcES
Particulars a. Loans and advances to related parties (Unsecured, considered good) advances receivable in cash or in kind Short term loans inter-corporate deposits option premium (refer note no.22) b. others (Unsecured, considered good) advances receivable in cash or in kind (refer foot note 1 below) prepaid expenses Short term loans current maturities of long term loans and advances Staff loans Mobilisation and other advances (refer foot note 2 below) advance payment of taxes (net of provision) ToTAL foot Note As at March 31, 2012 147.10 3,832.47 3,979.57 158.65 52.60 1,075.50 42.50 8.68 2,365.45 868.79 4,572.17 8,551.74
` in million As at March 31, 2011 255.54 1,465.90 120.00 1.25 1,842.69 273.89 50.09 1,436.00 5.80 1,589.63 840.13 4,195.54 6,038.23
1. advances receivable in cash or in kind from others includes receivable on account of forward contract (net) of ` 5.13 million (as at March 31, 2011 : nil) 2. Mobilisation advances are disclosed as long term and short term on the basis of technical estimates made by the Management on the progress of construction activities on various projects
80
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 16 : OTHER NON-cURRENT ASSETS
As at March 31, 2012 345.77 675.51 1,021.28
` in million As at March 31, 2011 156.95 263.34 420.29 ` in million As at March 31, 2012 232.37 926.71 1,159.08 As at March 31, 2011 231.87 475.26 707.13 ` in million As at March 31, 2012 As at March 31, 2011
retention Money receivable (unsecured, considered good) (refer note 29) interest accrued and not due ToTAL
NOTE 17 : OTHER cURRENT ASSETS
Particulars interest accrued unbilled revenue (refer note no. 29) ToTAL
NOTE 18 : TRADE REcEIvABlES
Particulars Trade receivables outstanding for a period less than six months from the date they are due for payment unsecured, considered good Trade receivables outstanding for a period exceeding six months from the date they are due for payment unsecured, considered good unsecured, considered doubtful less: provision for doubtful debts ToTAL
9,072.31 9,072.31
7,984.16 7,984.16
867.25 3.00 (3.00) 867.25 9,939.56
402.68 3.00 (3.00) 402.68 8,386.84 ` in million
NOTE 19 : cASH AND cASH EQUIvAlENTS
Particulars a. Cash and cash equivalents cash on hand Balances with Banks in current accounts b. others unpaid Dividend accounts Fixed Deposits placed for a period exceeding 3 months but not more than 12 months ToTAL included in above, the balances that meet the definition of cash and cash equivalents as per aS-3 “cash Flow Statements” As at March 31, 2012 1.08 38.15 39.23 0.35 1.20 1.55 40.78 39.23
As at March 31, 2011 0.78 73.57 74.35 0.12 1.11 1.23 75.58 74.35
81
transportation
annual report 2011-12
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 20 : cONTINgENT lIABIlITIES AND cOMMITMENTS
As at March 31, 2012 12.92
` in million As at March 31, 2011 25.71
(i) Contingent Liabilities (refer foot note 1) a) claims against the company not acknowledged as debts income tax demands contested by the company b) guarantees guarantees/counter guarantees issued in respect of borrowing facilities of subsidiary companies (refer foot note no.2) (ii) Commitments a) estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) b) exercise price payable in respect of call option contracts (refer note no. 22) c) investment commitments [net of advances of ` 2,173.08 million, (as at March 31, 2011 : ` 2,321.96 million)] foot Note
12,321.95 -
4,888.63 2.13
11,757.95
1.25 6,963.12
1) the company does not expect any outflow of economic resources in respect of the above and therefore no provision is made in respect thereof 2) certain bankers have issued guarantees which have been shown under “guarantees/counter guarantees issued in respect of borrowing facilities of subsidiary companies” aggregating ` 1,480.05 million (as at March 31, 2011 : ` 812.94 million) against a first charge on the receivables (including loans and advances) of the company
NOTE 21 : PROPOSED DIvIDEND
Name of the Entity As at March 31, 2012 Total ` in million Dividend proposed to be distributed to equity shareholders 777.07 Per share ` 4.00 As at March 31, 2011 Total ` in million 679.94 Per share ` 3.50
NOTE 22 : DERIvATIvES AND fOREIgN cURRENcY EXPOSURES
a) the company as a part of its strategic initiatives to consolidate/restructure its investments in surface transport sector, has made direct investments in certain special purpose entities (“Spe”s) engaged in that sector and also invested in units of a scheme of itnl road investment trust (the “Scheme”) which in turn has made investments in such Spes. amounts invested include derivative instruments in the form of call options the amounts outstanding as at March 31, 2012 in respect of derivative transactions are summarised below: Particulars call options written for sale of equity shares call option for equity shares in an Spe bought Number of instruments 2 (2) (1) Figures in brackets relate to March 31, 2011 call option prmium (` in million) 116.09 (116.09) (1.00) Exercise price payable / receivable (` in million) 6.11 (6.11) (1.00)
82
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
premium received by the company towards call option sold by it have been aggregated under the head “option premium liabilities” classified as a part of “other long term liabilities”. conversely, premiums paid by the company towards call options purchased by it have been aggregated under the head “option premium” and classified as a part of “Short-term loans and advances”. options in respect of “option premium liabilities” amounting ` 39.22 million (as at March 31, 2011 : ` 39.22 million) are to be exercised after a period of 12 months from the period end the underlying instruments in respect of the options are unquoted and the company intends to exercise the option, as these transactions have been entered into for strategic reasons. no losses have been identified in respect of the above derivatives necessitating a charge to the Statement of profit and loss. the aggregate exercise price payable is included as part of the company’s commitments (refer note no. 20) b) foreign currency exposures: the period end foreign currency exposures that have not been hedged by a derivative instrument or otherwise are given below: (i) amounts receivable/investments in foreign currency on account of the following: Particulars As at March 31, 2012 ` in million advance towards equity in a subsidiary company investments in subsidiary companies investments in subsidiary companies loans to subsidiary companies 0.02 2,722.34 1,342.76 153.47 4.07 foreign currency in million eur 0.00 eur 41.59 uSD 28.10 uSD 3.00 euro 0.06 As at March 31, 2011 ` in million 0.02 2,722.34 1,340.15 foreign currency in million eur 0.00 eur 41.59 uSD 28.05 -
(ii) amounts payable in foreign currency on account of the following: Particulars As at March 31, 2012 ` in million Fees for legal and technical fees 127.89 foreign currency in million uSD 2.50 As at March 31, 2011 ` in million 92.92 foreign currency in million eur 1.47
c) outstanding forward contracts entered into by the Company: As at Number of contracts 1 Notional Amount USD in million March 31, 2012 30.00
As at
Number of contracts nil
Notional Amount USD in million
March 31, 2011
nil
83
transportation
annual report 2011-12
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
NOTE 23 : REvENUE fROM OPERATIONS
Year ended March 31, 2012 4,046.83 1,681.97 596.45 21,400.57 27,725.82
` in million Year ended March 31, 2011 4,263.49 1,302.85 496.98 10,094.71 16,158.03
a. sale of services advisory and project development fees Supervision fees operation and maintenance income b. Construction revenue (refer note no.29) ToTAL
NOTE 24 : OTHER INcOME
Particulars a. Interest Income interest on loans interest on advance against property interest on debentures interest on covered warrants interest on call money interest on bank deposits b. Dividend Income on non-current investments c. Profit on sale of fixed assets (net) d. Profit on sale of unquoted long term Investments e. foreign exchange fluctuation gain (net) f. miscellaneous income ToTAL Year ended March 31, 2012 907.86 141.86 72.50 14.09 9.35 0.12 23.60 0.22 74.86 132.18 1,376.64
` in million Year ended March 31, 2011 532.64 123.60 46.66 23.33 0.06 32.51 0.66 40.09 52.22 851.77
NOTE 25 : OPERATINg EXPENSES
Particulars construction contract costs Fees for legal and technical services operation and maintenance expenses ToTAL Year ended March 31, 2012 19,413.92 686.94 371.05 20,471.91
` in million Year ended March 31, 2011 8,705.18 549.66 277.50 9,532.34
NOTE 26 : EMPlOYEE BENEfITS EXPENSE
Particulars Salaries and wages (refer foot note no.1) contribution to provident and other funds (refer foot note no. 2) Staff welfare expenses Deputation cost ToTAL Year ended March 31, 2012 471.51 33.11 89.69 37.00 631.31
` in million Year ended March 31, 2011 430.27 28.71 24.26 28.77 512.01
84
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
foot Note
forming part of the financial statements for the year ended March 31, 2012
1) employee cost is net of salaries of ` 16.73 million (previous year : ` 20.40 million), and contribution to provident and other funds of ` 1.50 million (previous year : ` 1.15 million) towards amounts recovered / recoverable in respect of staff on deputation with other entities 2 employee benefit obligations
(a) Defined-Contribution Plans the company offers its employees defined contribution plans in the form of provident fund, family pension fund and superannuation fund. provident fund, family pension fund and superannuation fund cover substantially all regular employees. contributions are paid during the period into separate funds under certain statutory/fiduciary-type arrangements. while both the employees and the company pay predetermined contributions into the provident fund and pension fund, the contribution to superannuation fund are made only by the company. the contributions are normally based on a certain proportion of the employee’s salary a sum of ` 23.84 million (previous year ` 19.87 million) has been charged to the Statement of profit and loss in this respect (b) Defined–Benefits plans the company offers its employees defined-benefit plans in the form of a gratuity scheme (a lump sum amount). Benefits under the defined benefit plans are typically based on years of service rendered and the employee’s eligible compensation (immediately before retirement). the gratuity scheme covers substantially all regular employees. in the case of the gratuity scheme, the company contributes funds to the life insurance corporation of india which administers the scheme on behalf of the company. commitments are actuarially determined at year-end. actuarial valuation is based on “projected unit credit” method. gains and losses of changed actuarial assumptions are charged to the Statement of profit and loss the net value of the defined-benefit commitment is detailed below: ` in million Particulars present value of commitments Fair value of plans transfer difference (net) prepaid amount taken to the balance sheet for the year ended March 31, 2012 37.29 (46.23) (8.94) for the year ended March 31, 2011 31.29 (39.66) 0.64 (7.73) ` in million Defined benefit Commitments : Gratuity opening balance interest costs current service cost Benefits paid transfer to other employer transfer from other employer actuarial loss closing Balance for the year ended March 31, 2012 31.29 2.39 7.80 (6.29) (0.16) 1.33 0.93 37.29 for the year ended March 31, 2011 22.98 1.85 7.50 (1.05) (3.27) 0.81 2.48 31.29
85
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
` in million Plan Assets: gratuity opening balance expected return on plan assets contributions by the company Benefits paid transfer to other employer transfer from other employer actuarial gain Fair value of plan assets for the year ended March 31, 2012 39.66 3.44 7.99 (6.29) (0.16) 1.33 0.26 46.23 for the year ended March 31, 2011 29.07 2.75 10.46 (1.05) (2.63) 0.81 0.27 39.66 ` in million Return on plan assets: gratuity expected return on plan assets actuarial gain actual return on plan assets expenses on defined benefit plan recognised in the Statement of profit and loss: ` in million Return on plan assets: gratuity current service costs interest expense expected return on investment net actuarial loss charge to the Statement of profit and loss for the year ended March 31, 2012 7.80 2.39 (3.44) 0.67 7.42 for the year ended March 31, 2011 7.50 1.85 (2.75) 2.21 8.82 for the year ended March 31, 2012 3.44 0.26 3.70 for the year ended March 31, 2011 2.75 0.27 3.02
the actuarial calculations used to estimate defined benefit commitments and expenses are based on the following assumptions, which if changed, would affect the defined benefit commitment’s size, funding requirements and pension expense Return on plan assets: gratuity rate for discounting liabilities expected salary increase rate expected return on scheme assets attrition rate Mortality table used Year ended March 31, 2012 Year ended March 31, 2011
8.50% 8.25% 6.50% 6.00% 8.00% 8.00% 2.00% 2.00% lic (1994-96) ultimate table lic (1994-96) ultimate table
the estimates of future salary increases considered in the actuarial valuation take into account inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market the amounts of the present value of the obligation, fair value of the plan assets, surplus or deficit in the plan, experience adjustments arising on plan liabilities and plan assets for the current period and previous four annual periods are given below:
86
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
Particulars
forming part of the financial statements for the year ended March 31, 2012
` in million As at As at As at As at As at March 31, 2012 March 31, 2011 March 31, 2010 March 31, 2009 March 31, 2008 37.29 46.23 8.94 31.29 39.66 0.64 7.73 22.98 29.07 6.09 18.19 22.34 4.15 19.48 21.14 0.08 1.58 ` in million Particulars experience adjustments on plan liabilities gain/(loss) experience adjustments on plan assets gain/(loss) As at As at As at As at As at March 31, 2012 March 31, 2011 March 31, 2010 March 31, 2009 March 31, 2008 (0.27) (0.26) (1.00) (0.27) 0.85 3.10 (6.54) (1.23) (8.91) 0.95
Defined benefit obligations plan assets unfunded liability transferred from group company Surplus
the contributions expected to be made by the company during the financial year 2012-13 is ` 45.09 million
NOTE 27 : fINANcE cOSTS
Particulars a. Interest expenses interest on loans b. other borrowing costs upfront fees and other finance charges ToTAL Year ended March 31, 2012 2,638.80 17.54 2,656.34
` in million Year ended March 31, 2011 1,484.23 70.80 1,555.03
NOTE 28 : ADMINISTRATIvE AND gENERAl EXPENSES
Particulars electricity travelling and conveyance printing and stationery rent (refer note no.32) rates and taxes (including wealth tax) repairs and maintenance (other than building and machinery) communication expenses insurance legal and consultation fees Directors' fees Bank commission Bid documents Foreign exchange fluctuation loss (net) Brand Subscription Fees provision for diminution in value of investments Miscellaneous expenses (refer foot note below) ToTAL Year ended March 31, 2012 6.28 94.92 8.62 114.88 3.01 36.19 19.95 69.16 67.82 1.53 73.94 20.75 218.25 110.00 255.43 1,100.73
` in million Year ended March 31, 2011 4.29 101.08 7.11 78.49 0.96 28.88 14.22 33.33 82.18 1.47 45.54 17.49 4.89 117.68 100.00 157.29 794.90
87
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
foot Note Miscellaneous expenses includes payment to auditors for the following: ` in million Particulars Payment to Auditor as : audit Fees tax audit Fees other Services (assurance) reimbursement of expenses Year ended March 31, 2012 9.50 0.50 6.86 0.14 Year ended March 31, 2011 8.38 0.20 8.04 0.10
Service tax which is being claimed for set off as input credit has not been included in the above
NOTE 29 : DISclOSURE IN RESPEcT Of cONSTRUcTION cONTRAcTS
Particulars contract revenue recognised as revenue during the year Year ended March 31, 2012 21,400.57 As at March 31, 2012 32,667.51 5,500.00 345.77 926.71 1,361.94
` in million Year ended March 31, 2011 10,094.71 ` in million As at March 31, 2011 11,266.94 5,682.74 156.95 475.26 1,420.19
Particulars aggregate revenue recognised up to advances received retention Money gross amount due from customers for contract work, disclosed as asset (i.e. unbilled revenue) gross amount due to customers for contract work, disclosed as liability (i.e. unearned revenue)
NOTE 30 : JOINT vENTURE
the company has the following Joint ventures as on March 31, 2012 and its proportionate share in the assets, liabilities, income and expenditure of the joint venture entities on the basis of the financial statements as at / for the year ended of those entities is given below: ` in million Name of the Jont venture company noida toll Bridge company limited Jorabat Shillong expressway limited n.a.M. expressway limited Percentage of holding Share in Assets 1,633.52 (1,590.34) 1,988.28 (1,210.29) 4,306.29 (2,522.60) Share in liabilities 446.56 (463.94) 1,783.14 (1,003.63) 3,136.57 (1,353.76) Share in contingent liabilities (-) (-) (-) Share in capital commitments Share in Income 256.94 (225.48) (-) 6.26 (14.58) Share in Expenditure 120.56 (117.41) 0.51 (3.34) 3.35 (8.44)
25.35% (25.35%) 50.00% (50.00%) 50.00% (50.00%) Figure in brackets relate to previous year
(-) 1,596.72 (2,400.25) 3,892.73 (6,258.56)
NOTE 31 : INcOME & EXPENDITURE IN fOREIgN cURRENcY
Particulars income - guarantee Fees expenditure Foreign travel legal and consultation Fees Seminar and conference expenses purchase of lab instruments others 88
SaFe SoliD SuStainaBle that’s itnl for you
` in million Year ended March 31, 2012 64.51 0.02 176.20 1.03 32.99 Year ended March 31, 2011 38.47 15.95 86.81 1.64 31.53 3.58
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 32 : lEASE
the company holds certain properties under a non-cancellable operating lease. the company’s future lease rentals under the operating lease arrangements as at the year end are as under: ` in million Particulars future lease rentals : within one year over one year but less than 5 years More than 5 years Amount charged to the statement of Profit and Loss for rent in respect of these properties As at March 31, 2012 54.82 70.31 44.80 70.51 As at March 31, 2011 71.63 132.77 40.54 57.95
the lease terms do not contain any exceptional / restrictive covenants nor are there any options given to company to renew the lease or purchase the properties. the agreements provide for changes in the rentals if the taxes leviable on such rentals change
NOTE 33 : EARNINgS PER SHARE
Particulars profit after tax weighted average number of equity shares outstanding nominal value per equity share Basic / Diluted earnings per share Unit ` in million number ` ` Year ended March 31, 2012 2,522.98 194,267,732 10.00 12.99
` in million Year ended March 31, 2011 2,880.36 194,267,732 10.00 14.83
NOTE 34 : SEgMENT INfORMATION
A. PrImArY - bUsINess segmeNTs ` in million Services for Surface Transportation Business March 31, March 31, 2012 2011 revenue external inter-Segment segment revenue ToTAL reveNUe Segment results less: interest expenses less: other unallocable expenditure add: interest income add: other unallocable income profit before taxation segment assets (a) segment liabilities (b) segment capital employed (a)-(b) capital expenditure Depreciation non cash expenditure other than depreciation 27,725.82 27,725.82 27,725.82 6,001.39 18,924.17 12,633.47 6,290.70 39.68 105.69 16,158.69 16,158.69 16,158.69 5,485.68 17,137.21 10,707.26 6,429.95 95.43 98.13 Unallocated March 31, 2012 2,656.34 585.21 1,145.78 230.86 41,479.66 28,332.27 13,147.39 March 31, 2011 1,555.03 265.03 726.29 125.48 31,392.34 19,974.64 11,417.70 Total March 31, 2012 27,725.82 27,725.82 27,725.82 6,001.39 2,656.34 585.21 1,145.78 230.86 4,136.48 60,403.83 40,965.74 19,438.09 39.68 105.69 115.79 March 31, 2011 16,158.69 16,158.69 16,158.69 5,485.68 1,555.03 265.03 726.29 125.48 4,517.39 48,529.55 30,681.90 17,847.65 95.43 98.13 102.77
89
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
b. seCoNDArY - geogrAPhICAL segmeNTs ` in million India March 31, 2012 revenue external Assets Segment assets capital expenditure 18,858.03 39.68 16,995.27 95.43 66.14 141.94 18,924.17 39.68 17,137.21 95.43 27,725.82 16,158.69 27,725.82 16,158.69 March 31, 2011 Outside India March 31, 2012 March 31, 2011 Total March 31, 2012 March 31, 2011
1) unallocated assets include non-current investments, advance towards share application money, loans given, interest accrued, option premium assets, advance payment of taxes (net), unpaid Dividend accounts and fixed deposits placed with banks 2) unallocated liabilities include borrowings, interest accrued but not due on borrowings, deferred tax liabilities (net), provision for tax (net), option premium liabiities and unpaid dividends
NOTE 35 : RElATED PARTY DISclOSURES
I) CUrreNT YeAr a) name of the related parties and Description of relationship: Nature of Relationship holding Company subsidiaries - Direct Name of Entity infrastructure leasing & Financial Services limited itnl road infrastructure Development company limited gujarat road and infrastructure company limited east Hyderabad expressway limited itnl international pte ltd, Singapore elsamex Sa, vansh nimay infraprojects limited Hazaribagh ranchi expressway limited pune Sholapur road Development company limited west gujarat expressway limited itnl road investment trust Moradabad Bareilly expressway limited Jharkhand road projects implementation company limited chenani nashri tunnelway limited Mp Border checkposts Development company limited Badarpur tollway operations Management limited charminar robopark limited (from July 27, 2011) Futureage infrastructure india linmited (formerly known as global parking plaza limited) (from July 14, 2011) il&FS rail limited (formerly known as itnl enso rail Systems limited) itnl offshore pte ltd, Singapore (from December 5, 2011) Kiratpur ner chowk expressway limited (from February 12, 2012) Karyavattom Sports Facilities limited (from February 8, 2012) Acronym used ilFS iriDcl gricl eHel iipl elSa vnil Hrel pSrDcl wgel irit MBel Jrpicl cntl MpBcDcl BtoMl crl Fiil irl iopl Kncel KSFl
90
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
Nature of Relationship subsidiaries - Indirect
Name of Entity north Karnataka expressway limited elsamex internacional, Sl grusamar ingenieria y consulting, Sl (proyectos De gestion Sistemas calculo y analisis S.a was merged with grusamar effective December 13, 2011) Sánchez Marcos Señalización e imagen, S.a elsamex india private limited cieSM-intevia S.a. Sociedad unipersonal control 7, S. a Mantenimiento y conservacion De vialidades, De c.v eSM Mantenimiento integral De S.a De c.v elsamex portugal S.a intevial-gestao integral rodoviaria S.a grusamar albania SHpK antenea Seguridad y Medico ambiente Sa proyectos y promociones inmobiliarias Sanchez Marcos Sl Senalizacion viales e imagen, Sa yala construction company private limited rapid Metrorail gurgaon limited area De Servicio coiros S.l. conservacion de infraestructuras De Mexico SD De cv alcantarilla Fotovoltaica Sa, Sociedad unipersonal area De Serviceo punta umbria Sl. Sociedad unipersonal il&FS Financial Services limited il&FS education & technology Services limited il&FS energy Development company limited il&FS environmental infrstructure Services limited il&FS infrastructure Development corporation limited il&FS investment Managers limited il&FS Maritime infrastructure company limited chattisgarh Highways Development company limited il&FS Securities Services limited iMicl Dighi Maritime limited Jharkhand accelerated road Development company limited andhra pradesh expressway limited itnl toll Management Services limited thiruvananthpuram road Development company limited warora chandrapur Ballarpur toll road limited noida toll Bridge company limited Jorabat Shillong expressway limited n.a.M. expressway limited Mr K ramchand-Managing Director and relatives Mr Mukund Sapre-executive Director and relatives
Acronym used nKel
elSainD
yccpl rMgl
fellow subsidiaries (only with whom there have been transaction during the year / there was balance outstanding at the year end)
Associates
Jointly Controlled entities Key management Personnel
iFin ietS ieDcl ieiSl iiDcl iiMl iMicl cHDcl iSSl iDMl JarDcl apel itMSl trDcl wcBtrl ntBcl JSel naMel
91
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 35 (i) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
bALANCes: Advance towards share Application money (Long-term) gricl Hrel MpBcDcl otHerS
-
600.00 964.50 936.48 2.32 2,503.30
-
-
-
-
600.00 964.50 936.48 2.32 2,503.30
Trade receivables naMel cntl MpBcDcl pSrDcl otHerS
-
1,241.42 1,045.73 1,945.98 1,582.87 5,816.00
387.15 387.15
728.98 728.98
1,594.66 820.04 2,414.70
-
1,594.66 1,241.42 1,045.73 1,945.98 3,519.04 9,346.83
Interest Accrued - Asset (Current and Non-current) ilFS Jrpicl apel otHerS
14.10 14.10
141.85 30.95 172.80
1.56 1.56
265.56 91.86 357.43
1.17 1.17
-
14.10 141.85 265.56 125.54 547.05
Interest accrued but not due on borrowings nKel
-
24.77 24.77
-
-
-
-
24.77 24.77
Investments in equity shares cntl elSa Jrpicl MBel otHerS
- 3,720.00 - 2,722.34 - 2,280.90 - 2,216.60 - 5,692.61 - 16,632.45
-
952.76 952.76
3,249.13 3,249.13
- 3,720.00 - 2,722.34 - 2,280.90 - 2,216.60 - 9,894.50 - 20,834.34
Investments in Preference shares wgel rMgl
-
296.90 507.50 804.40
-
-
-
-
296.90 507.50 804.40
Investments in Units irit
-
1,038.76 1,038.76
-
-
-
-
1,038.76 1,038.76
92
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 35 (i) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
Investments in Debentures apel
-
-
-
786.40 786.40
-
-
786.40 786.40
Investments in Covered Warrants ilFS
1,693.00 1,693.00
-
-
-
-
-
1,693.00 1,693.00
short-term Lendings apel Hrel eHel iriDcl wgel otHerS
-
500.00 470.00 540.00 425.00 494.47 2,429.47
73.00 73.00
751.00 249.00 1,000.00
330.00 330.00
-
751.00 500.00 470.00 540.00 425.00 1,146.47 3,832.47
Long-term Lendings iipl Jrpicl otHerS
-
1,534.70 1,459.40 1,510.87 4,504.97
-
646.40 646.40
-
-
1,534.70 1,459.40 2,157.27 5,151.37
Short-term Borrowings nKel
-
700.00 700.00
-
-
-
-
700.00 700.00
option premium liabilities irit
-
116.09 116.09
-
-
-
-
116.09 116.09
Trade Payables ilFS elSa otHerS
61.00 61.00
114.39 16.87 131.26
28.73 28.73
8.74 8.74
0.11 0.11
-
61.00 114.39 54.45 229.84
Advances recoverable in Cash or Kind elSa iipl wgel otHerS
-
47.30 18.84 55.35 9.43 130.92
14.51 14.51
1.63 1.63
0.04 0.04
-
47.30 18.84 55.35 25.61 147.10
93
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 35 (i) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
mobilisation Advances received (short-term) JSel cntl MBel pSrDcl otHerS
-
1,160.00 1,024.97 421.02 355.40 2,961.39
-
-
466.40 313.40 779.80
-
466.40 1,160.00 1,024.97 421.02 668.80 3,741.19
mobilisation Advances received Long-term) cntl pSrDcl otHerS
-
1,240.00 215.19 221.21 1,676.40
-
-
82.41 82.41
-
1,240.00 215.19 303.62 1,758.81
retention money receivable JSel Hrel pSrDcl otHerS
-
67.72 150.97 10.97 229.66
-
-
116.11 116.11
-
116.11 67.72 150.97 10.97 345.77
Transactions:
Advance Towards share Application money made Jrpicl MpBcDcl irl otHerS
-
749.25 806.15 715.59 245.30 2,516.29
-
-
0.05 0.05
-
749.25 806.15 715.59 245.35 2,516.34
Interest on Loans (expense) ilFS nKel otHerS
2.96 2.96
66.68 66.68
4.27 4.27
-
-
-
2.96 66.68 4.27 73.91
Inter-corporate deposits matured ilFS
5,020.00 5,020.00
-
-
-
-
-
5,020.00 5,020.00
94
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 35 (i) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives 616.91 616.91 791.00 199.00 990.00 651.00 651.00 330.00 330.00 Total
Inter-corporate deposits - placed ilFS Investments made / purchased ilFS wcBtrl Jrpicl irl otHerS Lendings apel Hrel iipl Jrpicl otHerS borrowings ilFS repayment of Lendings apel eHel iipl otHerS repayment of borrowings ilFS iSSl revenue from operations cntl Hrel MBel naMel otHerS mobilisation Advance received MpBcDcl JSel naMel
4,900.00 4,900.00 1,047.50 1,047.50 800.00 800.00 800.00 800.00 -
749.25 715.59 722.70 2,187.54 750.00 2,525.72 989.40 1,813.57 6,078.69 344.40 790.13 9.00 1,143.53 5,535.99 4,072.38 4,406.23
73.00 73.00 1,000.00 1,000.00
4,900.00 4,900.00 1,047.50 616.91 749.25 715.59 722.70 3,851.95 791.00 750.00 2,525.72 989.40 2,415.57 7,471.69 800.00 800.00 651.00 344.40 790.13 9.00 1,794.53 800.00 1,000.00 1,800.00
390.14 390.14 -
514.20 514.20 3,461.00 1,641.67 5,102.67 134.60 510.20 644.80
- 6,314.51 - 20,329.11 295.90 295.90
5,535.99 4,072.38 4,406.23 3,461.00 - 8,860.52 - 26,336.12 295.90 134.60 510.20 940.70 95
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 35 (i) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
other Income ilFS apel Jrpicl iipl
23.35 23.35
142.71 351.37 494.08
1.73 1.73
230.49 36.54 267.03
30.91 30.91
-
23.35 230.49 142.71 420.55 817.10
Administrative and general expenses ilFS elSa otHerS
302.05 302.05
133.17 133.17
70.01 70.01
-
0.22 0.22
2.75 2.75
302.05 133.17 72.98 508.20
operating expenses elSainD BtoMl otHerS Dividend paid ilFS
472.50 472.50
46.61 69.69 116.30 -
7.80 7.80 -
-
-
-
46.61 69.69 7.80 124.10 472.50 472.50
Director remuneration Mr K ramchand Mr Mukund Sapre
-
-
-
-
-
53.08 28.77 81.85
53.08 28.77 81.85
96
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES
II) PrevIoUs YeAr a) name of the related parties and Description of relationship: Nature of Relationship holding Company subsidiaries - Direct Name of Entity infrastructure leasing & Financial Services limited itnl road infrastructure Development company limited gujarat road and infrastructure company limited east Hyderabad expressway limited itnl international pte ltd, Singapore elsamex Sa, vansh nimay infraprojects limited Hazaribagh ranchi expressway limited pune Sholapur road Development company limited west gujarat expressway limited il&FS rail limited (formerly known as itnl enso rail Systems limited) Moradabad Bareilly expressway limited Jharkhand road projects implementation company limited itnl road investment trust chenani nashri tunnelway limited Mp Border checkposts Development company limited Badarpur tollway operations Management limited north Karnataka expressway limited elsamex internacional, Sl grusamar ingenieria y consulting, Sl Sánchez Marcos Señalización e imagen, S.a proyectos De gestion Sistemas calculo y analisis S.a elsamex india private limited cieSM-intevia S.a. Sociedad unipersonal (formerly known as centro De investigacion elpidio Sanchez Marcos S.a.) control 7, S. a geotecnia 7, S.a Mantenimiento y conservacion De vialidades, De c.v eSM Mantenimiento integral De S.a De c.v elsamex portugal S.a intevial-gestao integral rodoviaria S.a grusamar albania SHpK antenea Seguridad y Medico ambiente Sa proyectos y promociones inmobiliarias Sanchez Marcos Sl Senalizacion viales e imagen, Sa yala construction company private limited rapid Metro rail gurgaon limited Acronym used ilFS iriDcl gricl eHel iipl elSa vnil Hrel pSrDcl wgel irl MBel Jrpicl irit cntl MpcDcl BtoMl nKel
subsidiaries - Indirect
eipl
yccpl rMgl
97
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES
II) PrevIoUs YeAr a) name of the related parties and Description of relationship: Nature of Relationship Name of Entity inversiones tyndrum Sa (upto September 16, 2010. its now merged with elsamex Sa) area De Servicio coiros S.l. (from May 31, 2010) subsidiaries - Indirect conservacion de infraestructuras De Mexico SD De cv (from September 1, 2010) alcantarilla Fotovoltaica Sa, Sociedad unipersonal (from December 17, 2010) area De Serviceo punta umbria Sl. Sociedad unipersonal (from December 17, 2010) il&FS Financial Services limited (erst while il&FS Finvest ltd.) fellow subsidiaries (only il&FS education & technology Services limited with whom there have il&FS energy Development co ltd (from December 3, 2010) been transaction during il&FS environmental infrastructure & Service limited (formerly il&FS waste Management & urban Services limited) the year / there was balance outstanding at the year end) il&FS infrastructure Development corporation limited il&FS Maritime infrastructure company limited il&FS renewable energy limited chattisgarh Highways Development co limited il&FS Securities Services limited il&FS trust company limited Jharkhand accelerated road Development co ltd il&FS cluster Development initiative limited il&FS global Financial Services (uK) limited il&FS urban infrastructure Managers limited il&FS urban infrastructure Services ltd (upto March 29, 2011) andhra pradesh expressway limited itnl toll Management Services limited thiruvananthpuram road Development company limited warora chandrapur Ballarpur toll road limited noida toll Bridge company limited Jorabat Shillong expressway limited n.a.M. expressway limited Mr K ramchand-Managing Director and relatives Mr Mukund Sapre-executive Director and relatives iFin ietS ieDcl ieiSl iiDcl iMicl irel cHDcl iSSl itcl JarDcl icDil igFSl(uK) iuiMl iuiSl apel itMSl trDcl wcBtl ntBcl JSel naMel Acronym used
Associates
Jointly Controlled entities Key management personnel
98
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions with above mentioned related parties (mentioned in note 35 (ii) (a) above)
` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
bALANCes: Advance Towards share Application money (Long Term) gricl Hrel wcBtl otHerS Trade receivables cntl MpBcDcl JSel otHerS option premium assets ilFS Interest Accrued - Asset (Current and Non-current) ilFS apel otHerS Interest accrued but not due on borrowings iSSl nKel Investments in equity shares cntl elSa MBel otHerS Inter-corporate deposits ilFS
1.25 1.25
600.00 724.50 510.72 1,835.22 3,605.25 1,003.50 1,918.65 6,527.40 -
-
616.91 616.91 300.58 300.58 -
0.05 0.05 876.79 677.69 1,554.48 -
-
600.00 724.50 616.91 510.77 2,452.18 3,605.25 1,003.50 876.79 2,896.92 8,382.46 1.25 1.25
0.43 0.43
33.76 33.76
-
319.13 12.15 331.28
-
-
0.43 319.13 45.91 365.47
-
14.76 14.76
34.94 34.94 -
335.85 335.85 -
3,249.13 3,249.13 -
-
34.94 14.76 49.70
- 3,475.90 - 2,722.34 - 2,216.60 - 6,248.30 - 14,663.14 120.00 120.00 -
- 3,475.90 - 2,722.34 - 2,216.60 - 9,833.28 - 18,248.12 120.00 120.00
99
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions with above mentioned related parties (mentioned in note 35 (ii) (a) above)
` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
Investments in Preference shares wgel rMgl Investments in units irit Investments in Debentures apel Investments in Covered Warrants ilFS short-term Lendings wgel apel eHel otHerS Long-term Lendings gricl iriDcl apel Hrel Jrpicl otHerS short-term borrowings iSSl nKel option premium liabilities irit Trade Payables ilFS iFin elSa igFSl (uK) otHerS
648.00 648.00 33.47 33.47
296.90 287.00 583.90 1,038.54 1,038.54 202.50 519.40 83.00 804.90 308.80 213.00 250.00 470.00 1,241.80 700.00 700.00 116.09 116.09 92.92 3.22 96.14
1,000.00 1,000.00 23.82 30.03 0.40 54.25
786.40 786.40 611.00 50.00 661.00 474.60 171.80 646.40 2.69 2.69
-
-
296.90 287.00 583.90 1,038.54 1,038.54 786.40 786.40 648.00 648.00 202.50 611.00 519.40 133.00 1,465.90 308.80 213.00 474.60 250.00 470.00 171.80 1,888.20 1,000.00 700.00 1,700.00 116.09 116.09 33.47 23.82 92.92 30.03 6.31 186.55
100
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions with above mentioned related parties (mentioned in note 35 (ii) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives Total
Advances receivable in cash or in kind elSa wgel otHerS mobilisation Advance received (Long Term) cntl MBel JSel pSrDcl otHerS mobilisation Advance received (short Term) cntl MBel Hrel otHerS retention money receivable Hrel iriDcl JSel
-
141.93 68.60 15.22 225.75
2.45 2.45
8.23 8.23
19.11 19.11
-
141.93 68.60 45.01 255.54
-
1,771.21 482.04 410.72 233.31 2,897.28
-
-
372.22 372.22
-
1,771.21 482.04 372.22 410.72 233.31 3,269.50
-
628.80 919.20 439.74 393.32 2,381.06 70.20 47.65 117.85
-
-
32.18 32.18 39.10 39.10
-
628.80 919.20 439.74 425.50 2,413.24 70.20 47.65 39.10 156.95
Transactions:
Advance Towards share Application money made cntl MpBcDcl wcBtl otHerS Interest on Lons (expense) ilFS iSSl nKel Inter-corporate deposits matured ilFS
53.00 53.00
244.10 213.60 123.00 580.70
-
616.91 616.91
0.05 0.05
-
244.10 213.60 616.91 123.05 1,197.66 53.00 49.01 17.45 119.46
17.45 17.45
49.01 49.01 -
7,980.00 7,980.00
-
-
-
-
-
7,980.00 7,980.00
101
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions with above mentioned related parties (mentioned in note 35 (ii) (a) above) ` in million Particulars Holding company Subsidiaries fellow Subsidiaries Associates Key ManJointly agement controlled personnel Entities and relatives 221.80 45.00 266.80 264.00 264.00 354.08 354.08 1,167.55 210.00 1,377.55 1,886.98 1,886.98 Total
Inter-corporate deposits - placed ilFS Investments made / purchased ilFS cntl MBel pSrDcl naMel otHerS Lendings eHel Hrel Jrpicl trDcl otHerS repayment of Lendings eHel iriDcl apel otHerS repayment of borrowings ilFS otHerS borrowings ilFS nKel iSSl sale of Assets ilFS revenue from operations cntl MpBcDcl otHerS Administrative and general expenses ilFS elSa 102
SaFe SoliD SuStainaBle
8,100.00 8,100.00 148.00 148.00 5,580.00 5,580.00 5,580.00 5,580.00 0.07 0.07
3,475.90 2,216.10 1,599.50 948.25 8,239.75 609.40 250.00 470.00 441.70 1,771.10 90.00 109.50 107.09 306.59 50.00 50.00 750.00 750.00 -
1,000.00 1,000.00 -
8,100.00 8,100.00 148.00 3,475.90 2,216.10 1,599.50 1,167.55 1,158.25 9,765.30 609.40 250.00 470.00 221.80 486.70 2,037.90 90.00 109.50 264.00 107.09 570.59 5,580.00 50.00 5,630.00 5,580.00 750.00 1,000.00 7,330.00 0.07 0.07
- 4,451.29 - 4,032.81 - 6,133.42 - 14,617.52
- 4,451.29 - 4,032.81 - 8,374.48 - 16,858.58
202.66 -
173.14
-
-
-
-
202.66 173.14
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS Standalone
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 35 : RElATED PARTY DISclOSURES (contd.)
b) transactions with above mentioned related parties (mentioned in note 35 (ii) (a) above) ` in million Particulars Holding company 202.66 Subsidiaries 173.14 23.23 23.23 38.47 39.61 90.99 169.07 412.00 412.00 114.33 114.33 2,400.00 1,401.25 663.19 4,464.44 fellow Subsidiaries 14.21 11.03 1.03 26.27 26.60 30.03 56.63 0.33 0.33 Associates 227.85 13.50 241.35 0.25 0.25 Jointly controlled Entities 0.22 0.22 23.60 23.60 Key Management personnel and relatives 0.74 0.74 Total
ietS itcl otHerS other borrowing costs iFin igFSl (uK) operating expenses BtoMl other Income elSa gricl apel ilFS ntBcl otHerS refund of Advance Towards share Application money nKel otHerS sale of shares irit mobilisation Advance received cntl MBel otHerS Dividend paid ilFS Director remuneration Mr. K ramchand Mr. Mukund Sapre
14.21 11.03 1.99 403.03 26.60 30.03 56.63 23.23 23.23 38.47 39.61 227.85 23.27 23.60 104.82 457.62 412.00 0.25 412.25 114.33 114.33 2,400.00 1,401.25 1,067.59 4,868.84 405.00 405.00 36.85 21.48 58.33
23.27 23.27 405.00 405.00 -
-
-
404.40 404.40 -
36.85 21.48 58.33
103
transportation
annual report 2011-12
Notes
forming part of the financial statements for the year ended March 31, 2012
NOTE 36 : DISclOSURE Of lOANS AND ADvANcES IN THE NATURE Of lOANS TO SUBSIDIARIES AND ASSOcIATES
` in million Name of company March 31, 2012 March 31, 2011
Amount Maximum Amount Maximum as at amount as at amount March 31, outstanding March 31, outstanding 2012 during the year 2011 during the year subsidiaries east Hyderabad expressway limited gujarat road and infrastructure company limited itnl international pte. ltd., Singapore itnl road infrastructure Development company limited vansh nimay infraprojects limited west gujarat expressway limited elsamex india private limited il&FS rail limited (Formerly Known as itnl enso rail Systems limited) Hazaribagh ranchi expressway limited Jharkhand road projects implementation company limited Mp Border checkposts Development company limited pune Sholapur road Development company limited elsamex S.a., Spain Associates andhra pradesh expressway limited thiruvananthapuram road Development company limited warora chandrapur Ballarpur toll road limited 1,225.60 386.80 34.00 1,555.60 386.80 34.00 1,085.60 221.80 1,304.60 221.80 470.00 308.80 1,688.16 753.00 173.00 425.00 6.00 1,000.00 1,459.40 485.00 162.00 4.07 644.40 308.80 2,525.72 753.00 173.00 425.00 15.00 1,000.00 1,459.40 485.00 162.00 4.07 519.40 308.80 213.00 83.00 202.50 250.00 470.00 519.40 308.80 322.50 110.00 202.50 30.09 50.00 250.00 470.00 -
NOTE 37 :
consequent to the notiFication no. S.o. 447(e), DateD 28-2-2011 [aS aMenDeD BynotiFication no. F.no. 2/6/2008-cl-v, DateD 30-3-2011] the above financial statements have been presented in accordance with the revised Schedule vi. as required under the said notification corresponding figures for the previous year have been reclassified and presented in accordance with the current year presentation
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012
104
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Auditors’ Report
NeTWorKs LImITeD
IL&Fs Transportation Networks Limited
to the Board of Directors of IL&fs TrANsPorTATIoN
2. we conducted our audit in accordance with the auditing standards generally accepted in india. those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. an audit includes examining, on a test basis, evidence supporting the amounts and the disclosures in the financial statements. an audit also includes assessing the accounting principles used and the significant estimates made by the Management, as well as evaluating the overall financial statement presentation. we believe that our audit provides a reasonable basis for our opinion 3. we did not audit the financial statements of sixteen subsidiaries, whose financial statements reflect total assets of ` 82,427.29 million as at March 31, 2012, total revenues of ` 41,839.26 million and net cash outflows amounting to `. 2,058.65 million for the year ended on that date as considered in the consolidated Financial Statements. we also did not audit the financial statements of four jointly controlled entities, in which the group’s proportionate share in total assets is `. 22,604.04 million as at March 31, 2012, in total revenues is ` 4,212.62 million and in net cash outflows is ` 905.49 million as considered in the consolidated Financial Statements. the financial statements of
1. we have audited the attached consolidated Balance Sheet of il&FS tranSportation networKS liMiteD (“the company”), its subsidiaries and jointly controlled entities / operations (the company, its subsidiaries and jointly controlled entities / operations constitute “the group”) as at March 31, 2012, the consolidated Statement of profit and loss and the consolidated cash Flow Statement of the group for the year ended on that date, both annexed thereto. the consolidated Financial Statements include investments in associates accounted on the equity method in accordance with accounting Standard 23 (accounting for investments in associates in consolidated Financial Statements) and the jointly controlled entities / operations accounted in accordance with accounting Standard 27 (Financial reporting of interests in Joint ventures) as notified under the companies (accounting Standards) rules, 2006. these financial statements are the responsibility of the company’s Management and have been prepared on the basis of the separate financial statements and other financial information regarding components. our responsibility is to express an opinion on these consolidated Financial Statements based on our audit
105
transportation
annual report 2011-12
these twenty entities have been audited by other auditors whose reports have been furnished to us and our opinion in so far as it relates to the amounts included in respect of these entities, is based solely on the reports of the other auditors 4. the consolidated financial statements also include the group’s share of net loss of three associates, which have been accounted based on the equity method in accordance with accounting Standard 23 (accounting for investments in associates in consolidated Financial Statements), in respect of which ` 232.03 million being the group’s proportionate share of loss of the associates from the date of acquisition upto March 31, 2012 has been recognised (includes share of loss of ` 87.78 million for the year ended March 31, 2012). these financial statements have been audited by other auditors whose reports have also been furnished to us and our opinion, insofar as they relate to the amounts included in respect of these associates, is based solely on the report of the other auditors 5. the consolidated financial statements include the group’s proportionate share in the profit of one associate from the date of acquisition upto December 31, 2011 amounting to `19.91 million (including share of profit of `19.95 million for the period then ended) based on the unaudited financial statements as at / for the nine months ended December 31, 2011. there is no financial information available with the Management thereafter
6. without qualifying our opinion, we draw attention to note 13 and note 19 to the consolidated financial statements, wherein significant elements of the consolidated financial statements have been determined based on management estimates (which in turn are based on technical evaluations by independent experts). these include: (i) intangible assets and intangible assets under Development covered under service concession arrangements aggregating to carrying value of ` 62,146.93 million (40.76% of the total assets), the useful lives and the annual amortisation thereof; (ii) provision for overlay carried at ` 681.40 million in respect of intangible assets covered under service concession arrangements; and (iii) Financial assets covered under service concession arrangements, included as a part of receivables against Service concession arrangements, carried at ` 46,789.80 million (30.69% of the total assets) and revenue recognised thereon based on the effective interest method which in turn is based on evaluations of the future operating and maintenance costs and the overlay / renewal costs and the timing thereof 7. we report that the consolidated Financial Statements have been prepared by the company in accordance with the requirements of accounting Standard 21 (consolidated Financial Statements), accounting
106
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Standard 23 (accounting for investment in associates in consolidated Financial Statements) and accounting Standard 27 (Financial reporting of interests in Joint ventures) as notified under the companies (accounting Standards) rules, 2006 8. Based on our audit and on consideration of the separate audit reports on individual financial statements of the company, its aforesaid subsidiaries, joint ventures and associates and to the best of our information and according to the explanations given to us, in our opinion, the consolidated Financial Statements, read with our comments in paragraph 6 above and subject
to our comments in paragraph 5 above, give a true and fair view in conformity with the accounting principles generally accepted in india: (i) in the case of the consolidated Balance Sheet, of the state of affairs of the group as at March 31, 2012; (ii) in the case of the consolidated Statement of profit and loss, of the profit of the group for the year ended on that date and (iii) in the case of the consolidated cash Flow Statement, of the cash flows of the group for the year ended on that date
For DeLoITTe hAsKINs & seLLs chartered accountants (Firm registration no. 117366w)
Kalpesh J. Mehta partner Bengaluru, May 4, 2012 (Membership no. 48791)
107
transportation
annual report 2011-12
Consolidated Balance sheet
Particulars eQUITY AND LIAbILITIes shArehoLDers' fUNDs (a) Share capital (b) reserves and surplus mINorITY INTeresT NoN-CUrreNT LIAbLITIes (a) long-term borrowings (b) Deferred tax liabilities (net) (c) other long term liabilities (d) long-term provisions CUrreNT LIAbILITIes (a) current maturities of long-term debt (b) current maturities of finance lease obligations (c) Short-term borrowings (d) trade payables (e) other current liabilities (f) Short-term provisions ToTAL AsseTs NoN CUrreNT AsseTs (a) Fixed assets (net) (i) tangible assets (ii) intangible assets (iii) capital work-in-progress (iv) intangible assets under development (b) (c) (d) (e) (f) goodwill on consolidation (net) non-current investments Deferred tax assets long-term loans and advances other non-current assets Note
as at 31.03.2012
` in million As at March 31, 2012 As at March 31, 2011
2 3 4,5 6 8 9 11
1,942.68 25,695.22
27,637.90 2,934.65
1,942.68 20,449.53
22,392.21 2,175.13
69,737.62 2,046.51 2,291.01 750.91 10,525.53 65.22 21,930.82 11,304.42 1,860.04 1,395.19
74,826.05
35,990.11 1,438.65 1,113.61 691.78 7,594.31 128.97 10,235.07 9,884.69 1,458.73 1,122.69
39,234.15
7 10 12
47,081.22 152,479.82
30,424.46 94,225.95
13 1,251.63 27,612.84 195.20 34,812.66 14 8 16 18 15 20 21 22 17 19 5,265.68 3,831.91 5.23 7,944.32 48,690.68 122.22 210.10 8,820.13 2,837.87 9,198.44 1,680.91 1,104.14 12,915.10 10.32 15,755.81 2,795.59 1,919.88 116.75 5,927.69 25,933.80 89.29 262.17 7,489.01 5,275.46 10,926.89 3,704.05
63,872.33
29,785.37
65,737.82
36,693.71
CUrreNT AsseTs (a) current investments (b) inventories (c) trade receivables (d) cash and cash equivalents (e) Short-term loans and advances (f) other current assets
22,869.67 152,479.82
27,746.87 94,225.95
ToTAL notes 1 to 40 form part of the consolidated financial statements in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 108
SaFe SoliD SuStainaBle that’s itnl for you
Bengaluru, May 4, 2012
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Consolidated statement of Profit and Loss
for the Year Ended March 31, 2012
` in million Note I) II) III) reveNUe from oPerATIoNs oTher INCome ToTAL reveNUe (I + II) 24 25 Year ended March 31, 2012 56,056.21 1,238.07 57,294.28 Year ended March 31, 2011 40,482.26 786.28 41,268.54
Iv) exPeNses cost of materials consumed operating expenses employee benefits expense Finance costs Depreciation and amortization expense administrative and general expenses ToTAL exPeNses (Iv) v) ProfIT before TAxATIoN (III-Iv)
26 27 28 29 30
1,242.04 33,254.59 3,693.91 7,282.07 765.52 3,210.18 49,448.31 7,845.97
1,370.29 21,825.02 3,521.58 4,980.58 614.19 2,217.10 34,528.76 6,739.78
vI) TAx exPeNse: (1) current tax (2) Deferred tax (net) ToTAL TAx exPeNses (vI) vII) ProfIT for The YeAr before CoNsoLIDATIoN ADJUsTmeNTs (v-vI) vIII) Share of profit transferred to minority interest (net) Ix) Share of profit / (loss) of associates (net) ProfIT for The YeAr (vII+vIII+Ix) earnings per equity share (Face value per share `10/-): (1) Basic (2) Diluted notes 1 to 40 form part of the consolidated financial statements 31
1,830.94 626.27 2,457.21 5,388.76
1,700.20 542.25 2,242.45 4,497.33
(457.71) 38.53 4,969.58
(120.73) (47.81) 4,328.79
25.48 25.48
22.19 22.19
in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 Bengaluru, May 4, 2012 109
transportation
annual report 2011-12
Consolidated Cash Flow statement
for the Year Ended March 31, 2012
` in million Year Ended March 31, 2012 CAsh fLoW from oPerATINg ACTIvITIes profit Before taxes, Minority interest and Share of associates Adjustments for interest income profit on sale of investments (net) Dividend income Finance costs loss on sale of fixed assets (net) provision for employee benefits (net) Depreciation and amortization expense provision for Bad and Doubtful Debts provision for overlay expenses provision for dimunition in value of investments Foreign currency transalation reserve preliminary expense written off excess provisions written back operating profit before Working Capital Changes Adjustments changes in working capital: increase in trade receivables (Decrease) / increase in other assets & loans and advances (current and non current) increase in liabilities (current and non current) Cash generated from operations Direct taxes paid (net) Net Cash generated from operating Activities (A) CAsh fLoW from INvesTINg ACTIvITIes additions to fixed assets increase in receivable against Service concession arrangements (net) proceeds from sale of fixed assets purchase of / advance towards investments (net) acquisition of Subsidiaries / Jointly controlled entities Sale proceeds of investments proceeds from redemption of Mutual Fund units (net) long term loans given long term loans recovered Short term loans given (net) interest received Dividend received Fixed deposits for periods exceeding 3 months placed (net) inter-corporate deposits placed (net) advance against property Net Cash used in investing Activities (b) 7,845.97 (930.95) (8.58) (2.10) 7,282.07 2.97 0.66 765.52 316.85 130.48 (37.03) 186.43 0.04 (33.06) 15,519.27 Year Ended March 31, 2011 6,739.78 (691.06) (4.27) (10.37) 4,980.58 9.98 16.96 614.19 51.99 115.74 6.00 206.19 0.11 (0.05) 12,035.77
(1,634.23) 2,099.30 2,264.86 18,249.20 (1,962.04) 16,287.16
(1,062.91) (5,086.08) 5,398.42 11,285.20 (2,012.56) 9,272.64
(19,716.25) (21,520.44) 76.68 (1,267.63) (19,130.97) 29.68 (1,538.18) 17.40 (741.87) 637.30 2.10 (255.89) (403.30) (53,811.38)
(14,148.98) (13,220.55) 15.38 (1,150.27) (15.34) 381.66 2,505.80 (699.90) 234.79 581.63 10.37 (529.43) (247.43) (149.43) (26,431.70)
110
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Consolidated Cash Flow statement
for the Year Ended March 31, 2012
` in million Year Ended March 31, 2012 CAsh fLoW from fINANCINg ACTIvITIes Share issue expenses paid (Decrease)/ increase in advance towards capital proceeds from borrowings repayments of borrowings Finance costs paid Dividend payment tax on Dividend paid capital grant received proceeds from minority interest Net Cash generated from financing Activities (C) Net Decrease in Cash and Cash equivalents (A+b+C) cash and cash equivalent at the beginning of the year cash and cash equivalent at the end of the year Net Decrease in Cash and Cash equivalents notes: Components of Cash and Cash equivalents cash on Hand Balances with Banks in current accounts Fixed deposits placed for a period less than 3 months unpaid Dividend accounts cash and cash equivalents on acquisition of Joint venture Fixed deposits placed for a period exceeding 3 months cash and cash equivalents as per note 22 notes 1 to 40 form part of the consolidated financial statements 14.81 1,393.84 183.08 1,591.73 0.35 74.25 1,171.54 2,837.87 16.10 1,920.54 2,423.06 4,359.70 0.11 915.65 5,275.46 50,216.83 (10,232.23) (6,740.31) (687.83) (106.47) 1,929.09 377.16 34,756.24 (2,767.97) 4,359.70 1,591.73 (2,767.97) (195.33) 61.00 43,782.33 (22,583.05) (4,684.97) (592.00) (91.64) 411.55 294.95 16,402.84 (756.22) 5,115.92 4,359.59 (756.33) Year Ended March 31, 2011
in terms of our report attached For Deloitte HaSKinS & SellS chartered accountants Kalpesh J. Mehta partner
For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 Bengaluru, May 4, 2012 111
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE - 1: PRINcIPlES Of cONSOlIDATION, SIgNIfIcANT AccOUNTINg POlIcIES
A. bAsIs of CoNsoLIDATIoN: (a) the consolidated Financial Statements (“cFS”) relates to il&FS transportation networks limited (the “company”), its subsidiaries, jointly controlled entities and associates. the company and its subsidiaries constitute “the group” (b) the cFS has been prepared under the historical cost convention in accordance with the generally accepted accounting principles (“gaap”) in india, as adopted by the company and the applicable accounting Standards notified under section 211 (3c) of the companies act, 1956. all income and expenditure having a material bearing on the financial statements are recognised on accrual basis (c) the preparation of the financial statements requires the management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including current liabilities) as of the date of the financial statement, the reported income and expenses during the reporting period and disclosure of contingent liabilities. Management believes that the estimates used in the preparation of its financial statements are prudent and reasonable. actual results could differ from these estimates b. PrINCIPLes of CoNsoLIDATIoN: (a) the cFS has been prepared by the company in accordance with accounting Standards (aS) 21 on “consolidated Financial Statements”, aS 27 on “Financial reporting of interests in Joint ventures” and aS 23 on “accounting for investments in associates in consolidated Financial Statements” investments in associates are accounted for under the equity method in accordance with aS 23 on “accounting for investments in associates in consolidated Financial Statements” the financial statements of the company and its subsidiaries have been combined on a line by line basis by adding together the book values of like items of assets, liabilities, income and expenses after eliminating intragroup balances and intra-group transactions resulting in unrealised profits or losses in case of foreign subsidiaries, revenue items are consolidated by applying the average rate prevailing during the period to the foreign currency amounts. all assets and liabilities are consolidated by applying the rates prevailing at the period end to the foreign currency amounts. Shareholder’s funds are consolidated by applying the transaction date rates to the foreign currency amounts (b) the accounting policies of subsidiaries have been adjusted, as necessary and to the extent practicable, so as to ensure consistent accounting within the group (c) the excess of cost of the group’s investments in each subsidiary, jointly controlled entity and associates over the group’s share in equity of such entities, at the date on which such investment is made, is recognised as goodwill and included as an asset in the consolidated Balance Sheet. the excess of the group’s share in equity of each subsidiary, jointly controlled entity and associates at the date on which the investment is made, over the cost of the investment is recognised as capital reserve and included as reserves and Surplus under Shareholders’ equity in the consolidated Balance Sheet (d) Minority interest in the net assets of subsidiaries consists of amounts of equity attributable to the minority shareholders at the dates on which investments are made by the company in the subsidiaries and further movements in their share in the equity, subsequent to the dates of investments (e) the financial statements of the subsidiaries, associates and joint ventures used in the consolidation are drawn up to the same reporting date as that of the company i.e. March 31, 2012 except for one overseas subsidiary viz. elsamex S.a. whose audited financial statements (incorporating the financial statements of its subsidiaries, jointly controlled operations and its associates) have been drawn for a period of twelve months up to December 31, 2011 and adjusted for effects of significant transactions and other events that have occurred between January 1, 2012 and March 31, 2012 112
SaFe SoliD SuStainaBle that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
C. the list of subsidiaries, which are included in the cFS with their respective country of incorporation and the group’s holding therein for each of the financial years are givenbelow: Name of the Subsidiary country of Incorporation Proportion of group’s Interest (%) 2011-12 2010 - 11 83.61 100.00 74.00 100.00 69.29 100.00 100.00 90.00 74.00 83.61 100.00 74.00 100.00 Date of Acquisition of control
1. held directly: gujarat road and infrastructure company limited (“gricl”) Scheme of itnl road investment trust (“irit”) east Hyderabad expressway limited (“eHel”) itnl road infrastructure Development company limited (“iriDcl”) il&FS rail limited (formerly known as itnl enso rail Systems limited ) (“enSo”) elsamex Sa (includes 22.61 % shares held through iipl, previous year 22.61%) (“elsamex”) itnl international pte. ltd. (“iipl”) vansh nimay infraprojects limited (“vnil”) west gujarat expressway limited (“wgel”) [through control over the composition of Board of Directors as at March 31, 2011] Hazaribagh ranchi expressway limited (“Hrel”) pune Sholapur road Development company limited (“pSrDcl”) Moradabad Bareilly expressway limited (“MBel”) Jharkhand road projects implementation company limited (“Jrpicl”) chenani nashri tunnelway limited (“cntl”) Mp Border checkpost Development company limited (“MpBcDcl”) Badarpur tollway operations Management limited (“BtoMl”) Futureage infrastructure india limited (“Fiil”) [formerly known as global parking plaza limited ] charminar robopark limited (“crl”) itnl offshore pte. ltd. (“iopl”) Karyavattom Sports Facility limited (“KSFl”) Kiratpur ner chowk expressway limited (“Kncel”) 2. held through subsidiaries: north Karnataka expressway limited (“nKel”) proyectos y promociones inmobilarias Sanchez Marcos Sl atenea Seguridad y Medio ambiente S.a. proyectos De gestion Sistemas calculo y analisis S.a Sanchez Marcos Senalizacion e imagen S.a. Senalizacion viales e imagen S.u. elsamex internacional Sl grusamar ingenieria y consulting, S.l. elsamex portugal enghenería e Sistemas de gestao S.a. intevial gestao integral rodoviaria, S.a. elsamex india private limited yala construction co private limited Mantenimiento y conservacion de vialidades S.a. de c.v. eSM Mantenimiento integral de Sa de cv
india india india india india Spain Singapore india india
January 11, 2007 March 13, 2007 September 5, 2007 January 17, 2008
57.50 February 4, 2008 100.00 March 18, 2008 100.00 September 19, 2008 90.00 March 25, 2009 49.00 June 10, 2009 (initial control) 74.00 august 1, 2009 100.00 September 25, 2009 100.00 February 4, 2010 98.05 February 27, 2010 100.00 June 2, 2010 51.00 october 28, 2010 99.99 December 9, 2010 - July 14, 2011 July 27, 2011 December 5, 2011 February 8, 2012 February 12, 2012
india india india india india india india india india Singapore india india
74.00 100.00 100.00 93.04 100.00 51.00 100.00 61.22 97.85 100.00 99.88 100.00
india Spain Spain Spain Spain Spain Spain Spain portugal portugal india india Mexico Mexico
87.00@ 100.00 $ 100.00 $ 100.00 $ 100.00 $ 100.00 $ 100.00 $ 100.00 $ 73.50 $ 100.00 $ 99.15 $ 86.78 $ 64.00 $ 100.00 $
87.00@ 100.00 * 100.00 * 100.00 * 100.00 * 100.00 * 100.00 * 100.00 * 73.50 * 100.00 * 99.15 * 88.78 * 64.00 * 100.00 *
March 21, 2007 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008
113
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Name of the Subsidiary
country of Incorporation Spain Spain Spain albania india Spain Mexico Spain Spain
ciSeM-intevia, S.a. control 7, S.a. geotecnia 7, S.a.u. grusamar albania SHpK rapid Metrorail gurgaon limited (“rMgl”) area De Servicio coiros S.l.u. conservacion De infraestructuras De Mexico S.a. De c.v. alcantarilla Fotovoltaica, S.l. area De Servicio punta umbria, S.l.u.
$ * @ #
Proportion of group’s Interest (%) 2011-12 2010 - 11 100.00 $ 100.00 * 100.00 $ 100.00 * 100.00 $ 100.00 * 51.00 $ 51.00 * 59.26# 53.60# 100.00 $ 100.00 * 96.40 $ 96.40 * 100.00 $ 100.00 * 100.00 $
Date of Acquisition of control
March 18, 2008 March 18, 2008 March 18, 2008 March 18, 2008 July 30, 2009 May 31, 2010 September 1, 2010 December 17, 2010 100.00 * December 17, 2010
proportion of group’s interest as at December 31, 2011 proportion of group’s interest as at December 31, 2010 out of the above 13.00% is held directly by the company and balance 74.00% through the scheme of irit (previous year 13.00% held by the company and balance 74.00% through the scheme of irit). out of the above 26.00% is directly held by the company and balance 33.26% through enSo (previous year 26.00% held by company and balance 27.60% held through enSo)
the financial position and results (before eliminations) of KSFl, Kncel, iopl,Fiil and crl which became subsidiaries during the year ended March 31, 2012 are given below: fIIl March 31, 2012 44.66 20.16 64.82 cRl March 31, 2012 4.42 0.17 4.59 KNcEl March 31, 2012 84.13 388.13 472.26 KSfl March 31, 2012 0.26 62.63 62.89 IOPl March 31, 2012 2.12 0.10 2.22 March 31, 2012 2.22 2.22 0.43 0.43 (0.43) (0.43)
Equity and liabilities as at Shareholders’ Funds (including share application money) current liabilities
Assets as at
March 31, March 31, March 31, March 31, 2012 2012 2012 2012 3.11 435.69 62.74 Fixed assets (net Block) investments 0.18 long term loans and advances 60.88 0.65 4.59 36.57 0.15 current assets 64.82 4.59 472.26 62.89 Income for the period (from the date of incorporation / acquisition to march 31, 2012) 343.70 operating income ToTAL INCome 343.70 expense for the period (from the date of incorporation / acquisition to march 31, 2012) 343.70 operating expenses Depreciation 0.72 2.49 1.06 1.35 0.07 other administrative expenses ToTAL exPeNses 3.21 1.06 345.05 0.07 loss for the period before tax (3.21) (1.06) (1.35) (0.07) taxes loss for the period after tax (3.21) (1.06) (1.35) (0.07)
114
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
the financial position and results (before eliminations) of cntl, MpBcDcl, BtoMl which became subsidiaries during the previous year ended March 31, 2011 are given below: Equity and liabilities as at Shareholders’ Funds (including application money) non-current liabilities current liabilities cNTl March 31, 2011 3,777.64 164.88 3,952.69 7,895.21 March 31, 2011 1.46 7,633.15 260.60 7,895.21 MPBcDcl March 31, 2011 270.15 2,232.83 2,502.98 March 31, 2011 2,239.27 167.12 96.59 2,502.98 BTOMl March 31, 2011 1.31 0.04 10.11 11.46 March 31, 2011 0.05 0.06 11.35 11.46
share
Assets as at
Fixed assets (net block) long term loans and advances, other non current assets current assets
Income for the period (from the date of incorporation / acquisition to march 31, 2011) 5,071.06 2,235.93 construction contract revenue effective interest 162.09 0.40 other income ToTAL INCome 5,233.55 2,235.93 expense for the period (from the date of incorporation / acquisition to march 31, 2011) 4,615.37 2,235.93 construction contract costs operation & other expenses 27.64 3.95 interest and finance charges 505.20 Depreciation ToTAL exPeNses 5,148.21 2,239.88 profit/(loss) for the period before tax 85.34 (3.95) taxes (27.69) profit/(loss) for the period after tax 57.65 (3.95) D. INTeresT IN JoINTLY CoNTroLLeD eNTITIes:
23.27 23.27
21.98 0.12 22.10 1.17 (0.36) 0.81
(a) the financial statements (consolidated financial statements where applicable) of jointly controlled entities have been consolidated on a line by line basis by adding together the book values of like items of assets, liabilities, income and expenses after eliminating intra-group balances and intra-group transactions resulting in unrealised profits or losses as required by aS 27 using the proportionate consolidation method (b) the accounting policies in the jointly controlled entities have been adjusted as necessary and to the extent practicable, so as to ensure consistent accounting with the policies stipulated by the company
115
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
(c) the group’s interest in jointly controlled entities are: Date of country of Acquisition of Joint Incorporation control Proportion of group’s Interest (%) 2011-12 2010 - 11
Name of the company
held Directly : noida toll Bridge company limited (“ntBcl”) n.a.M. expressway limited (“nel”) Jorabat Shillong expressway limited (“JSel”) held through subsidiaries : geotecnia y control De Qualitat, S.a. chongqing yuhe expressway co. ltd. (“yuhe”) footnote: (i) ntBcl includes itnl toll Management Services limited subsidiary of ntBcl, which is also an associate of the company (ii) (iii)
$ *
india india india
various dates June 15, 2010 June 18, 2010
25.35 50.00 50.00
25.35 50.00 50.00
Spain china
July 15, 2010 December 27, 2011
50.00 $ 49.00
50.00 * -
proportion of group’s interest as at December 31, 2011 proportion of group’s interest as at December 31, 2010
e. INTeresT IN JoINT CoNTroLLeD oPerATIoNs : (a) the financial statements (including consolidated financial statements where applicable) of the jointly controlled operations have been consolidated on a line by line basis by adding together the book values of like items of assets, liabilities, income and expenses after eliminating intra-group balances and intra-group transactions resulting in unrealised profits or losses as required by aS 27 using the proportionate consolidation method. the financial statements of the jointly controlled operations are prepared by the respective operators in accordance with the requirements prescribed by the joint operating agreements of the jointly controlled operations (b) the accounting policies of jointly controlled operations have been adjusted as necessary and to the extent practicable, so as to ensure consistent accounting with the policies stipulated by the company (c) the group’s interest in jointly controlled operations are : Name of the Jointly controlled Operations Proportion of group’s Interest (%) 2011-12 $ ute elsamex arias elsamex-arias ute conservación coruña ii elsamex-infraestructuras terrestres elsamex- Modecar ute chenlo ute elsamex arias oca conservación orense ute elsamex grusamar ute elsamex-alpidesa elsamex-iberseñal ute Señalización Madrid elsamex-opsa ute peri Serrano uribe elsamex-Fitonovo ute casa Del Queso elsamex-const.cesfer ute San Jerónimo elsamex-torrescamara ute presas grusamar-elsamex-atenea ute Seguridad vial Murcia 116
SaFe SoliD SuStainaBle that’s itnl for you
2010 - 11* 75% 60% 80% 80% 50% 50% 50% 60% 80% 50% 50% 50% 30%
75% 60% 80% 80% 50% 50% 60% 80% 50% 50% 30%
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Name of the Jointly controlled Operations
Proportion of group’s Interest (%) 2011-12 $ 2010 - 11* 80% 50% 50% 50% 50% 50% 50% 50% 50% 45% 50% 50% 50% 40% 60% 50% 50% 50% 50% 50% 50% 50% 70% 28% 50% 50% 50% 50% 50% 25% 25% 25% 25% 25% 25% 25% 20% 20% 60% 80% 70% 50% 50% 40% 50% 50% 50% 50% 50% 50% 50% 50% 50% 117 80% 50% 50% 50% 50% 50% 50% 50% 50% 45% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 70% 28% 50% 50% 50% 50% 50% 25% 25% 25% 25% 25% 25% 20% 60% 80% 70% 50% 50% 40% 50% 50% 50% 50% 50% 50% 50% 50% 50%
elsamex-cauchil ute elsamex- cauchill Jaen cauchil – elsamex ute guadahortuna elsamex-cauchil ute Sierra nevada elsamex-cauchil ute estepona elsamex- prointec ute r4 api conservacion-elsamex ute teruel ii elsan pacsa-elsamex ute navalvillar De pela ii elsamex-Sando ute ii conservación a-395 elsamex-Sando ute refuerzo Del Firme a-395 elsamex-asfaltos uribe este Señal ute Durango ii elsamex-lopesan ute conservación Zona Sur Serop-elsamex ute Mantenimiento Serop-elsamex elsamex-const.Hispánica ute peaje la Jonquera ute elsamex Mag 3 ute Mag 3 elsamex elsamex-asfaltos urretxu ute itziar elsamex-tractores y obras ute elsamex-tyosa obras públicas elsamex-velasco ute polideportivos latina elsamex-velasco ute polideportivos Hortaleza elsamex-velasco ute polideportivos tetuán corsan corviam-elsamex ute corelsa elsamex-oca ute coruña iii asfaltos uribe-norte industrial-construcciones eder-elsamex ute vizcaya ii elsamex-rubau ute argentona elsamex- Martín casillas ute conservación cádiz Sice-elsamex ute Sice Fuente el Fresno ii elsamex-vimac ute vimac 01 elsamex-oca ute conservación orense ii ute abedul orihuela ute area Zamora ute abedul Zamora ute area leon ute abedul villavidel ute abedul cáceres ute abedul ponferrada atenea – grusamar ute andalucía atenea – grusamar ute asturias grusamar- consulting proyectos y Sistemas ute variante Sueca grusamar – Kv consultores ute puerto De Mahon grusamar – progescan ute areas De Servicio atenea – grusamar ute Medio ambiente-comunidad valenciana ute Kv-grusamar Zaragoza grusamar- ineco- inastecan ute arucas Betancourt-grusamar ute osuna Betancourt –grusamar ute rio alhama gusamar – ineco ute inversiones 2008 ute grusamar – oHS ingeniería y urbanismo ute travesía De Hermigua grusamar – inastecán ute expropiación Betancourt – grusamar ute linares Sener- grusamar ute grusamar – Betancourt ute abastecimiento Huelva grusamar – prover ute Zeneta San Javier
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Name of the Jointly controlled Operations
Proportion of group’s Interest (%) 2011-12 $ 2010 - 11* 50% 50% 10% 30% 80% 80% 50% 50% 80% 50% 80% 20% 60% 70% 50% 80% 23% 25% 24% 100% 100% 34% 100% 50% 20% 45% 50% 60% 50% 50% 60% 65% 50% 80% 50% 50% 50% 30% 50% 50% 10% 30% 80% 80% 50% 50% 80% 50% 80% 20% 60% 70% 50% 80% 23% 25% 24% 100% 100% 50% 100% 50% 45% 50% 60% 50% 50% 60% 65% 50% 80% 50% 50% 50% 30% 30% 50% 50% 50% 50% 50% 50% 30% 30% 60% 50% 70%
grusamar- elsamex – atenea ute Seguridad vial Murcia grusamar – inserco ute Santas Martas palanquinos intevia-grusamar-Dair ute Seguridad vial Bizkaia intevia-grusamar ute Seguridad vial norte atenea – grusamar ute andalucía atenea – grusamar ute asturias atenea – consulnima ute consultea atenea – iz ingenieros ute atda embalse De Flix atenea – laboratorio Del noroeste ute corredor, Bion-noia atenea – grusamar ute Medio ambiente-comunidad valenciana atenea – inastecan ute Supervision Baleares 2008 grusamar elsamex atenea ute Seguridad vial Murcia intevia-grusamar-Dair ute Seguridad vial Bizkaia intevia-grusamar ute Seguridad vial norte Dair –intevia ute ciesm- labiker compañía general De Sondeos-geoteyco-emcosa-ciesm-Sondeos Del Sur ute 6/2004 cgs-geoteyco-ciesm-enmacosa ute 2/2006 geoteyco-cgs-ciesm-enmacosa 2/2008 ute Boca chica Sucursal Dominicana ute conservacion grupo Sur ute corredores viales De colombia ute romana Sucursal Dominicana ute cordoba ute intevia-tairona-lycSa ute vizcaya ii ute elsamex-tyosa ute arona ute sector 03 ute viales el Jable ute ap-7 ondara ute almanzora ute autovia de Santiago ute tren Mallorca ute grusamar-eyser ute Dallas ute cican ciesm ute intevia tairona castinsa ute urbanizacion centro atenea – Basoinsa ute atda Bergara Zizurkil ute grusumar – inserco rambla retamar ute pycsa – atenea ute Mantenimient De cuenca ute elsamex-lujan alicante ute Sur Sevilla ute grusamar-intecsa-inarsa-atenea ute grusamar-intecsa-inarsa-atenea ute grusamar-ingelan ute conservacion asturias ute conservacion almeria
$ *
proportion of group’s interest as at December 31, 2011 proportion of group’s interest as at December 31, 2010
118
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
f. INvesTmeNTs IN AssoCIATes: (a) an associate is an entity over which the group is in a position to exercise significant influence, but not control or joint control, through participation in the financial and / or operating policy decisions of such enterprises. in accordance with aS 23 the investments are carried in the consolidated Balance Sheet at cost as adjusted by post acquisition changes in the group’s share in the reserves and Surplus of associates (b) the accounting policies of associates have been adjusted as necessary and to the extent practicable, so as to ensure consistent accounting with the policies stipulated by the company (c) Details of associates and ownership interest are as follows: Name of the company country of Incorporation Proportion of group’s Interest (%) 2011-12 1. held directly : andhra pradesh expressway limited (“apel”) thiruvananthapuram road Development company limited (“trDcl”) itnl toll Management Services limited (“itMSl”) (see footnote below) warora chandrapur Ballarpur toll road limited (“wcBtrl”) 2. held through subsidiaries : centro de investigaciones de curretros andalucía S.a. labetec ensayos técnicos canarios, S.a. cgi 8 S.a. elsamex road technology company limited Sociedad concesionaria autovía a-4 Madrid S.a vcS-enterprises limited yala construction company limited ramky elsamex ring road limited, Hyderabad emprsas pame sa De cv
$ *
2010-11 49.00 50.00 49.00 34.98 49.00 * 50.00 * 49.00 * 40.29 * 48.75 * 30.00 * 33.33 * 26.00 * 34.10 *
india india india india Spain Spain Spain china Spain india thailand india Mexico
49.00 50.00 49.00 35.00 49.00 $ 50.00 $ 49.00 $ 23.44 $ 48.75 $ 30.00 $ 33.33 $ 26.00 $ 34.00 $
note: itMSl is a subsidiary of ntBcl which is consolidated as a Jointly controlled entity
proportion of group’s interest as at December 31, 2011. proportion of group’s interest as at December 31, 2010
g. gooDWILL oN CoNsoLIDATIoN: (a) goodwill comprises the portion of the purchase price for an acquisition that exceeds the group’s share in the identifiable assets, with deductions for liabilities, calculated on the date of acquisition (b) goodwill arising from the acquisition of associates is included in the value of the holdings in the associate (c) goodwill is deemed to have an indefinite useful life and is reported at acquisition value with deduction for accumulated impairments. an impairment test of goodwill is conducted once every year or more often if there is an indication of a decrease in value. the impairment loss on goodwill is reported in the consolidated Statement of profit and loss (d) goodwill on acquisition of the foreign subsidiary is restated at the rate prevailing at the end of the year h. DebeNTUre IssUe exPeNDITUre incremental costs directly attributable to the issue of debentures are being charged to the consolidated Statement of profit and loss over the period of redemption of debentures
119
transportation
annual report 2011-12
Notes
I. i)
forming part of the Consolidated Financial statements for the year ended March 31, 2012
ACCoUNTINg for rIghTs UNDer servICe CoNCessIoN ArrANgemeNTs recognition and measurement the group builds infrastructure assets under public-to-private Service concession arrangements (Scas) which it operates and maintains for periods specified in the Scas under the Scas, where the group has received the right to charge users of the public service, such rights are recognised and classified as “intangible assets”. Such right is not an unconditional right to receive consideration because the amounts are contingent to the extent that the public uses the service and thus are recognised and classified as intangible assets. Such an intangible asset is recognised by the group at cost (which is the fair value of the consideration received or receivable for the construction services delivered) under the Scas, where the group has acquired contractual rights to receive specified determinable amounts, such rights are recognised and classified as “Financial assets”, even though payments are contingent on the group ensuring that the infrastructure meets the specified quality or efficiency requirements. Such financial assets are classified as “receivables against Service concession arrangements” consideration for various services (i.e. construction or upgrade services, operation and maintenance services, overlay services) under the Sca is allocated on the basis of costs actually incurred or the estimates of cost of services to be delivered ii) Contractual obligation to restore the infrastructure to a specified level of serviceability the group has contractual obligations to maintain the infrastructure to a specified level of serviceability or restore the infrastructure to a specified condition before it is handed over to the grantor of the Sca. Such obligations are measured at the best estimate of the expenditure that would be required to settle the obligation at the balance sheet date. in case of intangible assets, the timing and amount of such cost are estimated and recognised on an undiscounted basis by charging costs to revenue on the units of usage method i.e. on the number of vehicles expected to use the project facility, over the period at the end of which the overlay is estimated to be carried out based on technical evaluation by independent experts. in case of financial assets, such costs are recognised in the year in which such costs are actually incurred iii) revenue recognition revenue from construction services is recognised according to the stage of completion of the contract, which depends on the proportion of costs incurred for the work performed till date to the total estimated contract costs provided the outcome of the contract can be reliably estimated. when the outcome of the contract cannot be reliably estimated but the overall contract is estimated to be profitable, revenue is recognised to the extent of recoverable costs. any expected loss on a contract is recognised as an expense immediately. revenue is not recognised when the concerns about collection are significant revenue from financial asset is recognised in the consolidated Statement of profit and loss as interest, calculated using the effective interest method from the year in which construction activities are started revenue from operating and maintenance services and from overlay services is recognised in the period in which such services are rendered revenue from intangible assets is recognised in the period of collection which generally coincides with the usage of the public service or where from such rights have been auctioned, in the period to which auctioned amount relates iv) borrowing cost in respect of a financial asset, borrowing costs attributable to construction of the road are charged to consolidated Statement of profit and loss in the period in which such costs are incurred in respect of an intangible asset, borrowing costs attributable to construction of the roads are capitalised up to the date of completion of construction. all borrowing costs subsequent to construction are charged to the consolidated Statement of profit and loss in the period in which such costs are incurred
120
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
v) Amortisation of Intangible Asset the intangible rights which are recognised in the form of right to charge users of the infrastructure asset are amortised on the units of usage method i.e. on the number of vehicles expected to use the project facility over the concession period as estimated by the management a review of the estimated useful life/the concession period of the rights and number of vehicles expected to use the project facility over the balance period is undertaken by the Management based on technical evaluation by independent experts at periodic intervals to assess the additional charge for amortisation, if any J. fIxeD AsseTs AND DePreCIATIoN/AmorTIsATIoN: a) Tangible fixed assets and depreciation tangible fixed assets acquired by the group are reported at acquisition cost, with deductions for accumulated depreciation and impairment losses, if any the acquisition cost includes the purchase price (excluding refundable taxes) and expenses, such as delivery and handling costs, installation, legal services and consultancy services, directly attributable to bringing the asset to the site and in working condition for its intended use where the construction or development of any asset requiring a substantial period of time to set up for its intended use is funded by borrowings, the corresponding borrowing costs are capitalised up to the date when the asset is ready for its intended use Depreciation on tangible fixed assets is computed as under: (i) in respect of premises, depreciation is computed on the Straight line Method at the rates provided under Schedule Xiv of the companies act, 1956 (ii) the group has adopted the Straight line Method of depreciation so as to depreciate 100% of the cost of the following type of assets at rates higher than those prescribed under Schedule Xiv to the companies act, 1956, based on the Management’s estimate of useful life of such assets: Asset Type computers Specialised office equipment assets provided to employees Useful life 4 years 3 years 3 years
(iii) Depreciation on fixed assets, other than on assets specified in J (a) (i) and (ii) above, is provided for on the written Down value Method at the rates provided under Schedule Xiv of the companies act, 1956. Depreciation is computed pro-rata from the date of acquisition of and up to the date of disposal (iv) leasehold improvement costs are capitalised and amortised on a straight-line basis over the period of lease agreement unless the corresponding rates under Schedule Xiv are higher, in which case, such higher rates are used (v) all categories of assets costing less than ` 5,000 each, mobile phones and items of soft furnishing are fully depreciated in the year of purchase b) Intangible assets and amortisation intangible assets, other than those covered by Scas, comprise of software and amounts paid for acquisition of commercial rights under an “operation and Maintenance” agreement for a toll road project and are depreciated as follow: Asset Type licensed Software intellectual property rights Useful life over the licence period 5 - 7 years
121
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
intangible assets are reported at acquisition cost with deductions for accumulated amortisation and impairment losses, if any acquired intangible assets are reported separately from goodwill if they fulfill the criteria for qualifying as an asset, implying they can be separated or they are based on contractual or other legal rights and that their market value can be established in a reliable manner an impairment test of such intangible assets is conducted annually or more often if there is an indication of a decrease in value. the impairment loss, if any, is reported in the consolidated Statement of profit and loss intangible assets, other than those covered by Scas, are amortised on a “straight line” basis over their estimated useful lives. the estimated useful life of software is four years. the amount paid for acquisition of the rights under the “operations and Maintenance” agreement is amortised over the minimum balance period (as at the time of acquisition) of the concession agreement relating to the corresponding toll road project (refer Foot note no. ii of note 13 to the financial statements) K. ImPAIrmeNT of AsseTs: the carrying values of assets of the group’s cash-generating units are reviewed for impairment annually or more often if there is an indication of decline in value. if any indication of such impairment exists, the recoverable amounts of those assets are estimated and impairment loss is recognised, if the carrying amount of those assets exceeds their recoverable amount. the recoverable amount is the greater of the net selling price and their value in use. value in use is arrived at by discounting the estimated future cash flows to their present value based on appropriate discount factor L. goverNmeNT grANTs: (a) government grants are recognised only when it is reasonably certain that the related entity will comply with the attached conditions and the ultimate collection is not in doubt (b) grants received as compensation for expenses or losses are taken to the consolidated Statement of profit and loss is accounted in the period to which it relates. grants in the nature of promoter’s contribution are treated as capital reserve (c) grants related to specific fixed assets are treated as deferred income, which is recognised in the consolidated Statement of profit and loss in proportion to the depreciation charge over the useful life of the asset m. INvesTmeNTs: (a) investments are capitalised at actual cost including costs incidental to acquisition (b) investments are classified as long term or current at the time of making such investments (c) long term investments are individually valued at cost, less provision for diminution, which is other than temporary (d) current investments are valued at the lower of cost and market value N. INveNTorIes: (a) inventories are valued at the lower of cost and net realisable value. net realisable value is estimated at the expected selling price less estimated selling costs (b) costs for trading goods are determined using the annual weighted average principle and includes purchase price and non-refundable taxes (c) cost of raw material includes purchase price and non-refundable taxes (d) cost of manufactured goods include direct and indirect cost (e) inventories of electronic cards (prepaid cards) and on-board units are valued at the lower of cost and net realisable value. cost is determined on first-in-first-out basis 122
SaFe SoliD SuStainaBle that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
o. reCogNITIoN of reveNUe oTher ThAN from servICe CoNCessIoN ArrANgemeNTs: (a) revenue is recognised when it is realised or realisable and earned. revenue is considered as realised or realisable and earned when it has persuasive evidence of an arrangement, delivery has occurred, the sales price is fixed or determinable and collectability is reasonably assured (b) revenue in respect of arrangements made for rendering services is recognised over the contractual term of the arrangement. in respect of arrangements which provide for an upfront payment followed by additional payments as certain conditions are met (milestone payments), the amount of revenue recognised is based on the services delivered in the period as stated in the contract. in respect of arrangements where fees for services rendered are success based (contingent fees), revenue is recognised only when the factor(s) on which the contingent fees is based actually occur. in respect of the group’s trading activities, revenue is recognised on dispatch of goods, which coincides with the significant transfer of risks and rewards (c) revenue realised from grant of advertisement rights is recognised as follows: (i) Development fees are recognised as income during the year in which the advertisement rights are granted (ii) license fees are recognised as income on a “Straight-line” basis over the duration of the license. (d) revenue from development projects under fixed - price contracts, where there is no uncertainty as to measurement or collectability of consideration is recognised based on the milestones reached under the contracts. pending completion of any milestone, revenue recognition is restricted to the relevant cost which is carried forward as part of unbilled revenue (e) interest income is accrued evenly over the period of the instrument P foreIgN CUrreNCY TrANsACTIoNs: . (a) transactions in foreign currencies are translated to the reporting currency based on the exchange rate on the date of the transaction. exchange difference arising on settlement thereof during the year is recognised as income or expenses in the consolidated Statement of profit and loss (b) cash and bank balances, receivables, (other than those that are in substance the group’s net investment in a non integral foreign operation), and liabilities (monetary items) denominated in foreign currency outstanding as at the year-end are valued at closing date rates, and unrealised translation differences are included in the consolidated Statement of profit and loss (c) non monetary items (such as equity investments) denominated in foreign currencies are reported using exchange rate as at the date of the transaction. where such items are carried at fair value, these are reported using exchange rates that existed on dates when the fair values were determined (d) inter-company receivables or payables for which settlement is neither planned nor likely to occur in the foreseeable future and are in substance an extension to or a deduction from the group’s net investments in a foreign entity are translated at closing rates but the exchange differences arising are accumulated in a foreign currency translation reserve until disposal of the net investment, at which time they are recognised as income or expense in the consolidated Statement of profit and loss. any repayment of receivables or payables forming part of net investment in foreign operations is not considered as partial disposal of investments in foreign operations and amounts previously recognised in the foreign currency translation reserve are not adjusted until the disposal of the ownership interest occurs (e) the group’s forward exchange contracts are not held for trading or speculation. the premium or discount arising on entering into such contracts is amortised over the life of the contracts and exchange difference arising on such contracts is recognised in the consolidated Statement of profit and loss
123
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Q. emPLoYee beNefITs: a) short Term Short term employee benefits are recognised as an expense at the undiscounted amount expected to be paid over the period of services rendered by the employees to the group b) Long Term the group has both defined-contribution and defined-benefit plans, of which some have assets in special funds or securities. the plans are financed by the group and in the case of some defined contribution plans by the group along with its employees (i) Defined-contribution plans these are plans in which the group pays pre-defined amounts to separate funds and does not have any legal or informal obligation to pay additional sums. these comprise of contributions to the employees’ provident fund, family pension fund and superannuation fund. the group’s payments to the defined contribution plans are reported as expenses in the period in which the employees perform the services that the payment covers (ii) Defined-benefit plans expenses for defined-benefit gratuity plans are calculated as at the balance sheet date by independent actuaries in a manner that distributes expenses over the employee’s working life. these commitments are valued at the present value of the expected future payments, with consideration for calculated future salary increases, using a discount rate corresponding to the interest rate estimated by the actuary having regard to the interest rate on government bonds with a remaining term that is almost equivalent to the average balance working period of employees the actuarial gains and losses are recognised immediately in the consolidated Statement of profit and loss c) other employee benefits compensated absences which accrue to employees and which can be carried to future periods but are expected to be encashed or availed in twelve months immediately following the year end are reported as expenses during the year in which the employees perform the services that the benefit covers and the liabilities are reported at the undiscounted amount of the benefits after deducting amounts already paid. where there are restrictions on availment or encashment of such accrued benefit or where the availment or encashment is otherwise not expected to wholly occur in the next twelve months, the liability on account of the benefit is actuarially determined using the projected unit credit method r. TAxes oN INCome: (a) taxes include taxes on income, adjustment attributable to earlier periods and changes in deferred taxes. taxes are determined in accordance with enacted tax regulations and tax rates in force and in the case of deferred taxes at rates that have been substantively enacted (b) Deferred tax is calculated to correspond to the tax effect arising when final tax is determined. Deferred tax corresponds to the net effect of tax on all timing differences, which occur as a result of items being allowed for income tax purposes during a period different from when they are recognised in the financial statements (c) Deferred tax assets are recognised with regard to all deductible timing differences to the extent that it is probable that taxable profit will be available against which deductible timing differences can be utilised. when the group’s entities carry forward unused tax losses and unabsorbed depreciation, deferred tax assets are recognised only to the extent there is virtual certainty backed by convincing evidence that sufficient future taxable income will be available against which deferred tax assets can be realised (d) the carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced by the extent that it is no longer probable that sufficient future taxable profit will be available to allow all or a part of the aggregate deferred tax asset to be utilised
124
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
(e) Minimum alternate tax (Mat) paid in accordance with the tax laws, which gives rise to future economic benefits in the form of adjustment of future income tax liability, is considered as an asset if there is convincing evidence that the company will pay normal tax in the future period. accordingly, it is recognised as an asset in the Balance Sheet when it is probable that the future economic benefit associates with it will flow to the company s. ProvIsIoNs, CoNTINgeNT LIAbILITIes AND CoNTINgeNT AsseTs: (a) a provision is recognised when the group has a present obligation as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made (b) provisions (excluding retirement benefits) are not discounted to their present value and are determined based on best estimates required to settle the obligation at the Balance Sheet date (c) these are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. (d) contingent liabilities are not recognised but are disclosed in the notes to the financial statement (e) a contingent asset is neither recognised nor disclosed T. segmeNT rePorTINg: (a) Segment revenues, expenses, assets and liabilities have been identified to segments on the basis of their relationship to the operating activities of the Segment. (b) revenue, expenses, assets and liabilities, which relate to the group as a whole and are not allocable to segments on a reasonable basis, are included under “unallocated revenue/expenses/assets/liabilities” U. fINANCIAL INCome AND borroWINg CosTs: Borrowing costs are recognised in the period to which they relate, regardless of how the funds have been utilised, except where it relates to the financing of construction of development of assets requiring a substantial period of time to prepare for their intended future use. interest is capitalised up to the date when the asset is ready for its intended use. the amount of interest capitalised (gross of tax) for the period is determined by applying the interest rate applicable to appropriate borrowings outstanding during the period to the average amount of accumulated expenditure for the assets during the period v. eArNINgs Per shAre: (a) Basic earnings per share is calculated by dividing the net profit after tax for the year attributable to equity shareholders of the group by the weighted average number of equity shares in issue during the year. (b) Diluted earnings per share is calculated by dividing the net profit after tax for the year attributable to equity shareholders of the group by the weighted average number of equity shares determined by assuming conversion on exercise of conversion rights for all potential dilutive securities W. DerIvATIve TrANsACTIoNs: (a) premium paid on acquisition of option contracts is treated as a current asset until maturity. if the premium paid exceeds the premium prevailing as at the date of the balance sheet, the difference is charged to the consolidated Statement of profit and loss if the prevailing premium as at the balance sheet date exceeds the premium paid for acquiring option contracts, the difference is not recognised (b) premium received on option contracts written is treated as a current liability until maturity. if the premium prevailing on the balance sheet date exceeds the premium received on such options, the difference is charged to the consolidated Statement of profit and loss. if the prevailing premium as at the balance sheet date falls short of the premium received for writing option contracts, the difference is not recognised (c) Hedging instruments are initially measured at fair value, and are remeasured at subsequent reporting dates. changes in the fair value of these derivatives that are designated and effective as hedges of future cash flows are recognised directly in shareholder’s funds and the ineffective portion is recognised immediately in consolidated Statement of profit and loss 125
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
changes in the fair value of derivative financial instruments that do not qualify for hedge accounting are recognised in consolidated Statement of profit and loss premium paid on option contracts acquired is treated as an asset until maturity. premium received on option contracts written is treated as liability until maturity. in case of Forward exchange contracts which are not intended for trading or speculation purposes, the premium or discount arising at the inception of such a forward exchange contract is amortised as expense or income over the life of the contract. exchange differences on such a contract are recognised in the consolidated Statement of profit and loss in the reporting period in which the exchange rates change. any profit or loss arising on cancellation or renewal of such a forward exchange contract is recognised as income or as expense for the period x. LeAses: (a) Finance leases, which effectively transfer to the group substantial risks and benefits incidental to ownership of the leased item, are capitalised and disclosed as leased assets. lease payments are apportioned between finance charges and reduction of lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged directly against income. (b) leases where the lessor retains substantially all the risks and benefits of ownership of the asset are classified as operating leases. operating lease payments are recognised as an expense in the consolidated Statement of profit and loss on a straight line basis over the lease term. any compensation, according to agreement, that the lessee is obliged to pay to the lessor if the leasing contract is terminated prematurely is expensed during the period in which the contract is terminated Y. CAsh AND CAsh eQUIvALeNTs: cash comprises of cash on Hand, cheques on Hand and demand deposits with Banks. cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risks of changes in value Z. CoNsoLIDATeD CAsh fLoW sTATemeNT: the consolidated cash Flow Statement is prepared in accordance with the “indirect Method” as explained in the accounting Standard (aS) 3 on “cash Flow Statements”
NOTE 2 : SHARE cAPITAl
As at March 31, 2012 Number of Shares 250,000,000 194,267,732 194,267,732 194,267,732 ` in million As at March 31, 2011 Number of Shares 250,000,000 194,267,732 194,267,732 194,267,732 ` in million
Particulars Authorised equity Shares of ` 10/- each Issued equity Shares of ` 10/- each subscribed and Paid up equity Shares of ` 10/- each fully paid (refer foot note no. i, ii, and iii) ToTAL fooT NoTes: i)
2,500.00 1,942.68 1,942.68 1,942.68
2,500.00 1,942.68 1,942.68 1,942.68
reconciliation of the number of shares outstanding at the beginning and at the end of the reporting year
126
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Shares outstanding at the beginning of the year Shares issued during the year Shares bought back during the year Shares outstanding at the end of the year
As at March 31, 2012 Number of ` in million Shares 194,267,732 1,942.68 194,267,732 1,942.68
As at March 31, 2011 Number of ` in million Shares 194,267,732 1,942.68 194,267,732 1,942.68
ii) of the above 135,000,000 (as at March 31, 2011 : 135,000,000) shares are held by the holding company viz. infrastructure leasing & Financial Services limited (“il&FS”) and 2,440,534 (as at March 31, 2011 : nil) shares are held by a fellow subsidiary viz. il&FS Financial Services limited iii) Shareholder’s Shareholding more than 5% shares Shareholder il&FS il&FS employee welfare trust ToTAL
*
As at March 31, 2012 Number of % of total Shares held holding 135,000,000 69.49% not applicable* not applicable* 135,000,000 69.49%
As at March 31, 2011 Number of Shares held 135,000,000 10,867,769 145,867,769 % of total holding 69.49% 5.59% 75.08%
the number of shares held by il&FS employee welfare trust as at March 31, 2012 do not represent 5% or more of the total holding and hence, the disclosure of number of shares and percentage of holding as at March 31, 2012 have not been given
NOTE 3 : RESERvES AND SURPlUS
Particulars (a) securities Premium Account opening balance (+/-) addition / (Deletion) during year (b) general reserve opening balance (+) current year transfer (-) written back in current year (c) Debenture redemption reserve opening balance (+) created during the year (-) written back in current year (d) Capital reserve opening balance (+) created during the year (-) written back in current year (e) other reserves (refer foot note no.i) Foreign currency translation reserve cash flow hedge reserve (f) Capital reserve on Consolidation (net) (refer foot note no. ii) opening balance (+) on account of acquisition (net) (-) written back in current year (g) surplus in Consolidated statement of Profit and Loss opening balance (+) profit for the current year (-) consolidation adjustment (-) transfer to general reserve (-) transfer to debenture redemption reserve (-) Dividends (including dividend tax) (-) premium on preference shares of subsidiary (-) Dividend tax on premium on preference shares of subsidiary ToTAL As at March 31, 2012 10,320.57 715.51 252.29 21.96 237.95 1,881.55 1,085.91 102.35 (523.42) 1,215.19 55.36 6,806.49 4,969.58 (2.62) (252.29) (237.95) (934.39) (16.19) (2.63) 10,320.57
` in million As at March 31, 2011 10,320.57 427.47 288.04 20.47 1.49 29.13 1,852.42 (221.15) (290.59) 1,076.06 139.13 3,580.21 4,328.79 (288.04) (1.49) (794.16) (16.14) (2.68) 10,320.57
967.80
715.51
259.91
21.96
2,967.46 (421.07)
1,881.55 (511.74)
1,270.55
1,215.19
10,330.00 25,695.22
6,806.49 20,449.53
127
transportation
annual report 2011-12
Notes
fooT NoTes: i)
forming part of the Consolidated Financial statements for the year ended March 31, 2012
(a) Foreign currency translation reserve ` in million As at March 31, 2012 (221.15) 323.50 102.35 As at March 31, 2011 (438.70) 217.55 (221.15)
Particulars Balance at the beginning of the year Movement for the year (net) Balance at the end of the year (b) cash flow hedge reserve
the movement in hedging reserve held by a subsidiary during the year ended March 31, 2012 for derivatives designated as cash flow hedges is as follow: ` in million Particulars Balance at the beginning of the year Movement for the year (net) Balance at the end of the year As at March 31, 2012 (290.59) (232.83) (523.42) As at March 31, 2011 (271.53) (19.06) (290.59)
ii) During the current year, the company has purchased additional shares of wgel by exercising the option available with it. this purchase has resulted in capital reserve on consolidation of ` 66.42 million. the company has adjusted the goodwill on consolidation of ` 11.06 million arising on earlier purchase of wgel Shares. thus, net amount of ` 55.36 million has been credited to capital reserve on consolidation
NOTE 4 : PREfERENcE SHARES ISSUED BY SUBSIDIARY TO MINORITY SHAREHOlDERS (INclUDED UNDER MINORITY INTEREST) :
one Subsidiary company viz. gricl, had originally issued cumulative redeemable convertible preference Shares (crcpS) carrying 1% dividend, which were to be redeemed at the end of the 13th year from the date of allotment at a premium of 60% on the par value. these shares also carried an option to convert the cumulative amount (including the redemption premium of 60%) into Deep Discount Bonds (DDBs) at the end of the 13th year at a value calculated based on the issue price of ` 17.38 each at the time of conversion and having a maturity value of ` 153.98 each redeemable over a period of 3 years commencing from the 5th year from the date of conversion into the DDBs. However, consequent to the restructuring of the company’s corporate debt, the subscribers to the crcpS agreed to a revision in the terms thereof to the effect that the dividend becomes non-cumulative and the crcpS will become non-cumulative redeemable convertible preference Shares (nrcpS) with effect from april 1, 2004. as a result, the base price and the redemption price of each DDB stood modified; these prices will be determined at the end of the 13th year as a part of the restructuring package approved by the corporate Debt restructuring cell, the subsidiary is not permitted to declare any dividend on equity or preference shares without making good the sacrifices of the lenders the accumulated premium accrued on non-cumulative redeemable convertible preference Shares and not provided for as at March 31, 2012 ` 152.98 (previous year ` 136.80 million) and the tax on distribution thereof aggregates ` 24.82 (previous year 22.72 million) these preference shares issued amounting to ` 350.00 million (as at March 31, 2011 : ` 350.00 million) have been included as a part of Minority interest
128
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 5 : ADvANcE TOwARDS cAPITAl TO SUBSIDIARY BY MINORITY SHAREHOlDERS (INclUDED UNDER MINORITY INTEREST) :
Particulars gujarat road and infrastructure company limited # vansh nimay infraprojects limited Mp Border checkpost Development company limited ToTAL
#
` in million
As at March 31, 2012 450.00 450.00
As at March 31, 2011 450.00 1.00 60.00 511.00
as required under the restructuring package of a subsidiary viz. gricl approved by the corporate Debt restructuring cell on June 17, 2004, the promoters of gricl had advanced an aggregate sum of ` 450.00 million as advance towards share capital. the subsidiary intends to convert these advances into subordinated debt. pending completion of the approval process, the group has classified the amount as an advance towards capital
the aggregate amount of ` 450.00 million (as at March 31, 2011 : ` 511.00 million) as detailed above has been included as a part of Minority interest
NOTE 6 : lONg-TERM BORROwINgS
Particulars (a) bonds / Debentures (refer foot note no. i) (i) Secured non convertible debentures Deep discount bonds (ii) unsecured non convertible debentures (b) Term Loans (i) Secured From banks (refer foot note no. ii) From financial institutions From others (ii) unsecured From banks From others (c) finance lease obligations (i) Secured ToTAL As at March 31, 2012
` in million As at March 31, 2011
3,116.00 360.22 252.00
3,476.22 252.00
3,751.00 356.90 288.00
4,107.90 288.00
52,206.03 997.56 254.71 5,646.10 6,905.00 -
53,458.30
25,948.63 716.09 420.66 4,323.42 56.45 128.96
27,085.38
12,551.10 69,737.62
4,379.87 128.96 35,990.11 ` in million
NOTE 7 : SHORT-TERM BORROwINgS
Particulars (a) Loans repayable on demand (i) Secured From banks From financial institutions From others (ii) unsecured From banks From financial institutions (b) Term Loans Secured from banks unsecured from banks unsecured from related parties unsecured from others ToTAL As at March 31, 2012
As at March 31, 2011
685.15 8.03 210.73 7,161.91 12,650.00 1,215.00
693.18 210.73
1,065.77 28.60 809.61 12.11 7,300.00 1,018.98 -
1,094.37 821.72
21,026.91 21,930.82
8,318.98 10,235.07 129
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 8 : DEfERRED TAX lIABIlITIES (NET) AND DEfERRED TAX ASSETS
the group entities have net deferred tax liabilities aggregating ` 2,046.51 (previous year ` 1,438.65 million) and deferred tax assets aggregating ` 5.23 (previous year ` 116.75 million) as at March 31, 2012 a) The components of deferred tax liabilities (net) are furnished below: ` in million Particulars Liabilities: timing differences in respect of income timing differences in respect of depreciation Assets: timing differences in respect of depreciation timing differences in respect of employee benefits timing differences in respect of unabsorbed depreciation and business losses timing differences in respect of provision for doubtful debts timing differences in respect of provision for overlay Deferred tax liabilities (net) b) The components of deferred tax assets is furnished below: ` in million Particulars Assets: timing differences in respect of income timing differences in respect of depreciation timing differences in respect of employee benefits Deferred tax assets As at As at March 31, 2012 March 31, 2011 0.01 2.50 2.72 5.23 114.86 0.23 1.66 116.75 ` in million As at March 31, 2012 796.00 1,213.33 281.68 796.00 As at March 31, 2011 185.10 721.10 207.41 185.10 As at As at March 31, 2012 March 31, 2011 2,023.45 32.32 (0.06) (8.22) (0.98) 2,046.51 765.45 1,072.22 (9.72) (302.60) (2.55) (84.15) 1,438.65
NOTE 9 : OTHER lONg TERM lIABIlITIES
Particulars (a) Trade Payables From others (b) others redemption premium accrued but not due on borrowings other liabilities ToTAL
1,495.01 2,291.01
928.51 1,113.61 ` in million
NOTE 10 : OTHER cURRENT lIABIlITIES
Particulars (a) (b) (c) (d) (e) (f) interest accrued but not due on borrowings interest accrued and due on borrowings income received in advance advance received unearned revenue other liabilities (statutory and other dues) As at March 31, 2012 42.74 29.14 470.07 9.77 1,308.32 1,860.04 1,860.04
As at March 31, 2011 40.24 34.06 77.28 419.30 38.13 849.72 1,458.73 1,458.73
ToTAL
130
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars (a) (b) (c) (d)
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 11 : lONg-TERM PROvISIONS
As at March 31, 2012 5.15 0.88 152.99 25.35 21.28 537.77 7.49 ` in million As at March 31, 2011 5.15 0.88 136.80 22.72 11.15 507.59 7.49
provision for dividend on preference shares of subsidiary provision for dividend tax on preference dividend of subsidiary provision for premium on preference shares of subsidiary provision for dividend tax on premium on preference shares of subsidiary (e) provision for employee benefits (f) provision for overlay (refer foot note (i) of note no. 12) (g) provision for contingency (refer foot note no. i) ToTAL
750.91 750.91
691.78 691.78
fooT NoTe (i) the provision for contingency includes ` 7.49 million provided in accordance with the terms of scheme of amalgamation of jointly controlled entity for prepayment of loans ` in million Particulars opening balance add : provision made during the year less : provision utilised / reversed during the year Closing balance As at March 31, 2012 7.49 7.49 As at March 31, 2011 7.49 7.49 ` in million As at March 31, 2012 252.26 68.74 800.67 129.89 143.63 1,395.19 1,395.19 As at March 31, 2011 261.73 29.80 679.94 110.30 11.15
NOTE 12 : SHORT-TERM PROvISIONS
Particulars (a) “provision for employee benefits (net) (refer foot note no. (i) (B) of note 28)” (b) provision for tax (net of advance) (c) proposed dividend on equity shares (d) provision for tax on proposed dividend on equity shares (e) provision for overlay (refer foot note no. i) ToTAL
1,122.69 1,122.69
fooT NoTe (i) provision for overlay in respect of toll roads maintained by the group under service concession arrangements and classified as intangible assets represents contractual obligations to restore an infrastructure facility to a specified level of serviceability in respect of such asset. estimate of the provision is measured using a number of factors, such as contractual requirements, technology, expert opinions and expected price levels. Because actual cash flows can differ from estimates due to changes in laws, regulations, public expectations, technology, prices and conditions, and can take place many years in the future, the carrying amounts of provision is reviewed at regular intervals and adjusted to take account of such changes accordingly, financial and accounting measurements such as the revenue recognized on financial assets, allocation of annuity into recovery of financial asset, carrying values of financial assets and depreciation of intangible assets and provisions for overlay in respect of service concession agreements are based on such assumptions Movements in provision made for overlay are tabulated below: ` in million Particulars opening balance adjustment for new acquisition / exchange difference during the year utilised for the year provision made during the year closing balance As at As at As at March 31, 2012 March 31, 2012 March 31, 2011 long-term current long-term 507.59 40.92 432.77 17.45 2.18 (15.04) 12.73 117.75 113.56 537.77 143.63 548.51 131
132 ` in million gross Block
Deletions / Additions Adjustments Balance as at March 31, 2012 AdjustBalance ments / Reas at classificaApril 1, tions (Refer 2011 footnote iv)
Depreciation charge for the year (refer foot note i)
NOTE 13 : fIXED ASSETS
Notes
SaFe
SoliD
Accumulated Depreciation and Amortisation
Deletions / Adjustments Balance as at March 31, 2012 Balance as at March 31, 2011 Balance as at March 31, 2012
Net Block
transportation
Balance as at April 1, 2011
Adjustments / Reclassifications (Refer footnote iv)
SuStainaBle
forming part of the Consolidated Financial statements for the year ended March 31, 2012
that’s itnl for you
a Tangible Assets land Building and structures vehicles Data processing equipments office premises office equipments leasehold improvements Furniture and fixtures electrical installations plant and machinery advertisement structure plant and machinery - leased vehicles - leased Furniture and fixtures - leased Building and structures - leased land - leased 51.32 16.02 11.04 3.38 0.02 110.12 10.22 15.00 217.12 5.32 891.45 68.12 28,581.61 681.63 1.22 201.50 206.54 124.33 26.70 11.66 (0.02) 173.29 57.91 4,473.31 2,718.24 226.50 324.32 15.23 26.96 392.42 47.38 3,221.68 0.25 151.22 53.39 - 1,247.34 1,251.63 50.28 153.15 18.57 1.25 0.01 1.57 0.15 0.15 32.71 3.50 24.07 173.94 1,076.99 139.72 11.52 81.64 12.45 277.78 98.59 1,924.31 24.80 302.82 125.83 169.96 28.89 2.79 782.02 78.84 1.92 30.89 3.65 116.64 14.39 997.11 9.23 611.67 54.67 4.71 9.71 20.22 (28.10) 13.15 6.43 24.20 80.57 584.48 7.12 (474.94) (5.91) (4.71) 3.99 3.46 109.45 13.15 0.19 10.13 4.52 16.82 3.25 96.54 2.73 42.09 18.79 3.20 26.47 14.88 848.49 1.24 103.90 0.01 2.10 1.20 46.25 8.17 0.36 157.30 1.56 96.65 25.11 1,653.02 19.08 - 178.82 3.02 64.53 16.90 24.07 147.47 228.50 35.82 9.42 35.39 4.28 120.48 1.94 271.29 5.72 124.00 61.30 153.06 28.89 491.72 15.18 -
26.03 53.36 1,027.97 106.66 11.53 60.17 12.45 133.04 15.31 1,056.43 11.67 1,028.94 83.56 10.38 158.15 26.73
(1.96) 120.58 16.27 18.29 12.00 141.51 83.41 790.47 13.13 (736.34) 30.77 (10.38) 11.81 2.16
26.03 50.57 245.95 27.82 9.61 29.28 8.80 16.40 0.92 59.32 2.44 417.27 28.89 5.67 148.44 26.73 1,104.14 56.67 181.06 27,334.27 12,598.74
3,822.38
181.00 207.76
ToTAL b Intangible Assets Software / licences commercial rights acquired (refer foot note no. ii) rights under service concession arrangements (refer foot note no. iii) trademarks and licences others 0.14 10.03 896.79 69.37 29,173.98 0.02 0.01 0.02 1.92 182.41 1.78 93.76 928.20 0.13 5.34 190.40 416.90 83.97
13,280.37 14,477.91
1.79 172.38
8.18 442.79 767.11 614.58
-
1.91 107.28
0.01 75.13
0.01 78.62 0.25 1,561.14 27,612.84 12,915.10 195.20 10.32 - 34,812.66 15,755.81 47.63 4,782.82 63,872.33 29,785.37 6.69 3,646.44 29,785.37
ToTAL
13,843.30 14,503.26
annual report 2011-12
c Capital work-in-progress d Intangible Assets grAND ToTAL PrevIoUs YeAr
10.32 184.88 15,755.81 - 19,056.85 33,431.81 14,994.98 20,355.64 19,134.36 153.36 14,176.37
195.20 - 34,812.66 127.28 68,655.15 3,646.44 32.28 33,431.81 2,954.58
02 | corporate overview
fooT NoTes: 1) Depreciation on assets used during the construction period 1.59 (previous year ` 0.39 million) has been included in “capital work in progress”. therefore, the charge to the statement of profit and loss is lower by this amount
Notes
2) During the year 2006-07, the group incurred a cost of rupees 60.00 million for acquiring commercial rights under the “operations and Maintenance” agreement (“o&M contract”) for one of its road projects from the erstwhile contractor. under the terms of the o&M contract, the group is entitled to routine maintenance price and the operation price for maintaining and operating the project. the group expects benefits under the o&M contract to accrue until the end of the concession period which is not expected to be earlier than May 12, 2029. accordingly, the expenditure incurred by the group for acquisition of the rights is treated as an intangible asset and is being amortised on a straight line basis over the minimum balance period of the concession i.e. 22 years and 7 months (from the date of acquisition of the said rights)
3) estimates under service Concession Arrangement - right under service Concession Arrangements / Intangible assets under Developments
20 | Strategic review
under the Service concession arrangements, where the group has received the right to charge users of the public services, such rights are recognized and classified as “intangible assets”. Such a right is not an unconditional right to receive consideration because the amounts are contingent to the extent that the public uses the service and thus are recognized and classified as intangible assets. Such an intangible asset is recognised by the group at cost (which is the fair value of consideration received or receivable for the construction services delivered) accordingly, the fair value of consideration for construction services in respect of intangible assets covered under service concession arrangements of the group, the useful lives of such intangible assets, the annual amortisation in respect thereof, and the provisions for overlay costs have been estimated by the Management having regard to the contractual provisions, the evaluations of the units of usage and other technical evaluations by independent experts, the key elements having been tabulated below: ` in million
Particulars
Margin on construction services recognised in respect of intangible assets (` in million) carrying amounts of intangible assets (` in million) amortisation charge in respect of intangible assets (` in million)
As at March 31, 2012 5,009.67 27,334.27 392.42 50,867,738 to 1,554,733,739 681.40 34,812.66
As at March 31, 2011 2,170.59 12,598.74 212.12 56,042,180 to 1,770,530,926 548.51 15,755.81
units of usage (no. of vehicles)
32 | Statutory reportS
provision for overlay in respect of intangible assets (` in million) carrying amounts of intangible assets under developments (` in million)
forming part of the Consolidated Financial statements for the year ended March 31, 2012
4) adjustments includes additions to gross Block and accumulated Depreciation towards acquisition of new subsidiaries / jointly controlled entities during the year and deductions to gross Block and accumulated Depreciation towards sale / cesssation of subsidiaries / jointly controlled entities and regrouping of previous year figures
59 | FinancialS consolidated
133
transportation
annual report 2011-12
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 14 : NON-cURRENT INvESTMENTS
` in million As at March 31, 2012 1,268.36 (11.94) 175.24 9.84 (392.75) 1,048.75 182.85 1,693.00 1,111.51 (204.20) 3,831.91 As at March 31, 2011 699.13 17.51 39.25 9.10 (225.37) 539.62 182.36 648.00 791.13 (241.23) 1,919.88
a) Investments in Unquoted equity Instruments - Associates investments in associates add /(less): unrealised gain on transactions between the company and its associates add: post-acquisition share of profit / (loss) of associates (net) add: post-acquisition share of movement in the other reserves of an associate (net) less: cash flow hedge reserve b) Investments in Unquoted equity Instruments (refer note 32) c) Investments in Covered Warrants (refer foot note no. i) d) Investments in other Instruments less: provision for dimunition in the value of investments ToTAL fooT NoTe
(i) the company’s investment in “covered warrants” aggregating to ` 1,693.00 million (as at March 31, 2011 ` 648.00 million) issued by infrastructure leasing & Financial Services limited (“il&FS”) the holding company, are variable interest debt instruments under which the holder is entitled to a proportionate share of the dividend, if any, declared by road infrastructure Development company of rajasthan limited (“riDcor”), Jharkhand accelerated road Development company limited (“JarDcl”), chhatisgarh Highways Development company limited (“cHDcl”) and Jharkhand road projects implementation company limited (“Jrpicl”) on the equity shares held by il&FS as well as the interest granted by riDcor on the Fully convertible Debentures (“FcDs”) held by il&FS. However, the company is not entitled to rights and privileges, which il&FS enjoys as a shareholder / debentureholder. the instruments are unsecured
NOTE 15 : cURRENT INvESTMENTS
` in million Particulars investments in units of Mutual Funds ToTAL As at March 31, 2012 122.22 122.22 As at March 31, 2011 89.29 89.29
134
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 16 : lONg-TERM lOANS AND ADvANcES
As at March 31, 2012 142.28 1.83 81.09 142.28
` in million As at March 31, 2011 785.25 42.20 120.89 785.25
(a) Capital Advances unsecured, considered good (b) security Deposits Secured, considered good unsecured, considered good (c) Loans and advances to related parties unsecured, considered good - option premium (net of provision) - long term loans (d) other loans and advances unsecured, considered good - advance recoverable in cash or kind - others - loans to others ToTAL
82.92
163.09
36.67 1,237.29
1,273.96
136.43 1,287.11
1,423.54
4,764.56 1,680.60
6,445.16 7,944.32
3,403.31 152.50
3,555.81 5,927.69 ` in million
NOTE 17 : SHORT-TERM lOANS AND ADvANcES
Particulars (a) Loans and advances to related parties unsecured, considered good - advance recoverable in cash or kind - related parties - inter-corporate deposits - advance towards share application money - Short term loans (b) other loans and advances unsecured, considered good - advance recoverable in cash or kind - Mat credit entitlement - advance payment of taxes (net of provision) - advance towards share application money - Short term loans - others - current maturities of long term loans and advances ToTAL As at March 31, 2012
As at March 31, 2011
15.91 673.30 1,073.00
1,762.21
11.28 270.00 616.91 660.99
1,559.18
3,808.43 213.07 1,096.62 269.80 2,005.81 42.50
7,436.23 9,198.44
6,161.56 71.02 989.35 469.83 1,675.95 -
9,367.71 10,926.89
NOTE 18 : OTHER NON-cURRENT ASSETS
Particulars (a) long term trade receivables (unsecured, considered good) (b) receivables against Service concession arrangement (refer foot note (i) of note no. 19)" (c) toll receivable account (refer foot note no. (i) (d) interest accrued but not due ToTAL As at March 31, 2012 278.29 45,980.02 1,898.70 533.67 48,690.68 48,690.68
` in million As at March 31, 2011 0.06 23,715.91 1,898.70 319.13 25,933.80 25,933.80
135
transportation
annual report 2011-12
Notes
fooT NoTe
forming part of the Consolidated Financial statements for the year ended March 31, 2012
(i) toll receivable account includes ` 1,565.47 million being the aggregate shortfall in the assured return up to September 30, 2003, as adjusted for margin recognised during construction, as per the terms of the concession agreements in respect of the two road projects in a subsidiary. the amount was recognised with a corresponding credit to the general reserve of the subsidiary pursuant to the order dated May 18, 2005 passed by the Honourable High court of gujarat at ahmedabad, sanctioning the Scheme of amalgamation of the two toll road companies with the subsidiary Similarly, pursuant to the orders passed by the Honourable High courts of allahabad and Delhi dated March 22, 2007 and May 21, 2007, approving a scheme of amalgamation, a jointly controlled entity, had also recognised an amount in the toll receivable account. after making appropriate adjustments on account of the construction margin, a sum of ` 333.23 million has been included as the group’s share in the toll receivable account
NOTE 19 : OTHER cURRENT ASSETS
Particulars (a) unbilled revenue (b) interest accrued (c) receivables against Service concession arrangement (refer foot note no. i) (d) grant receivable ToTAL fooT NoTe (i) estimates under service Concession Arrangement - financial assets As at March 31, 2012 243.44 809.78 627.69 1,680.91 1,680.91
` in million As at March 31, 2011 515.40 164.33 1,553.45 1,470.87 3,704.05 3,704.05
under the Service concession arrangements, where the group has acquired contractual rights to receive specified determinable amounts, such rights are recognised and classified as Financial assets, even though payments are contingent on the group ensuring that the infrastructure meets the specified quality or efficiency requirements. Such financial assets are classified as “receivables against Service concession arrangements accordingly, the fair value of consideration for construction services and the effective interest rate in the case of financial assets of the group covered under service concession arrangements included as a part of “receivables against Service concession arrangements” have been estimated by the Management having regard to the contractual provisions, the evaluations of the future operating and maintenance costs and the overlay / renewal costs and the timing thereof by independent experts, the key elements having been tabulated below: ` in million Particulars Margin on construction and operation & maintenance and renewal services recognised in respect of receivables against Service concession arrangements carrying amounts of Financial assets included under receivables against Service concession arrangements revenue recognised on receivables against Service concession arrangements on the basis of effective interest method As at March 31, 2012 4,104.42 As at March 31, 2011 2,490.34
46,789.80 9,362.88
25,269.36 6,254.28
136
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 20 : INvENTORIES
` in million As at March 31, 2012 As at March 31, 2011
inventories (at cost) (i) raw materials (ii) Finished goods (iii) Stores and spares ToTAL
47.82 158.21 4.07 210.10
10.72 248.58 2.87 262.17
NOTE 21 : TRADE REcEIvABlES
Particulars (a) Trade receivables outstanding for a period less than six months from the date they are due for payment unsecured, considered good (b) Trade receivables outstanding for a period exceeding six months from the date they are due for payment unsecured, considered good other considered doubtful less: provision for doubtful debt ToTAL 5,927.48 5,927.48 6,843.56 As at March 31, 2012
` in million As at March 31, 2011
6,843.56
2,892.65 3.00 (3.00)
2,892.65 8,820.13
645.45 3.58 (3.58)
645.45 7,489.01
NOTE 22 : cASH AND cASH EQUIvAlENTS
Particulars (a) Cash and cash equivalents cash on hand current accounts Fixed Deposits placed for a period less than 3 months (b) other bank balances unpaid dividend accounts Fixed Deposits placed for a period exceeding 3 months ToTAL As at March 31, 2012
` in million As at March 31, 2011
14.81 1,468.09 183.08 0.35 1,171.54
1,665.98
16.10 1,920.54 2,423.06 0.11 915.65
4,359.70
1,171.89 2,837.87
915.76 5,275.46
137
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 23 : cONTINgENT lIABIlITIES AND cAPITAl cOMMITMENTS (A) cONTINgENT lIABIlITIES
Particulars (i) (ii) claims against the group not acknowledged as debt other money for which the company is contingently liable - income tax demands contensted by the group - royalty to nagpur Municipal corporation (iii) in terms of the approved restructuring package, the lenders of a subsidiary have a right of recompense, in respect of the sacrifices undertaken by them on account of reduction in interest rates and wavier of compound interest and liquidated damages, in the event of projects’ cash flows(after adjusting the operating costs) are in excess of the revised debt servicing requirements ` in million As at As at March 31, 2012 March 31, 2011 812.72 429.84 10.74 not ascertainable 381.89 126.55 10.74 not ascertainable
(iv) in case of disputes decided in favour of the group at the First appellate authority for amounts disallowed amounting to ` 1,639. 24 million (previous year ` nil), the department has gone for further appeal in all the cases. if decided against the company, it will result in reduction of unabsorbed losses and unabsorbed depreciation as per the income -tax law (v) in case of disputes decided against the group for amounts disallowed amounting to ` 16.14 million (previous year ` 389.77 million), the company has gone for further appeal in all the cases. if decided against the company, it will result in reduction of unabsorbed losses and unabsorbed depreciation as per the income-tax law
(B) cAPITAl cOMMITMENTS
Particulars (i) estimated amount of contracts remaining to be executed on capital account and not provided for net of advances paid aggregate ` 5,842.65 ( previous year ` 6,868.17 million) As at March 31, 2012 61,221.11
` in million As at March 31, 2011 62,300.32
(ii) exercise price payable in respect of call option contracts (iii) investment commitments [net of advances of ` 269.80 million, (as at March 31, 2011 : ` 469.80 million)]
200.00
11.77 320.00
(c) OTHER cOMMITMENTS
Particulars (i) negative grant to national Highways authority of india ("nHai") (upto 2019-20) As at March 31, 2012 2,700.00
` in million As at March 31, 2011 2,800.00
138
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 24 : REvENUE fROM OPERATIONS
Year ended March 31, 2012 1,905.89 342.13 7,167.44 2,781.32 3,108.60 12.61 79.30
` in million Year ended March 31, 2011 809.13 124.88 8,635.21 1,870.15 68.52 1,827.57 40.50 47.45
Income from services advisory and project management fees lenders' engineer and supervision fees operation and maintenance income toll revenue periodic maintenance income Finance income licence fee operation and maintainace grant from nHai (b) Construction income (c) sales (net of sales tax) ToTAL
(a)
15,397.29 40,602.72 56.20 56,056.21
13,423.41 26,944.19 114.66 40,482.26
NOTE 25 : OTHER INcOME
Particulars (a) Interest Income interest on loans granted interest on debentures interest on call money interest on bank deposits interest on short term deposit interest on advance towards property (b) Profit on sale of investment (net) (c) Profit on sale of fixed assets (d) Dividend income (e) other non-operating income advertisement income excess provisions written back exchange rate fluctuation gain (net) Miscellaneous income ToTAL Year ended March 31, 2012
` in million Year ended March 31, 2011
535.88 86.59 33.94 96.41 36.27 141.86
930.95 8.58 0.33 2.10
401.80 46.65 31.44 72.69 14.88 123.60
691.06 4.27 0.80 10.37
1.10 33.06 73.09 188.86
296.11 1,238.07
4.31 0.05 75.42
79.78 786.28
NOTE 26 : cOST Of MATERIAlS cONSUMED
Particulars (a) Material consumption (b) purchase of traded products ToTAL Year ended March 31, 2012 1,211.90 30.14 1,242.04 1,242.04
` in million Year ended March 31, 2011 1,252.37 117.92 1,370.29 1,370.29
139
transportation
annual report 2011-12
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 27 : OPERATINg EXPENSES
Year ended March 31, 2012 30,512.48 554.89 220.64 1,703.91 130.48 13.11 19.08 100.00 33,254.59 33,254.59
` in million Year ended March 31, 2011 17,896.53 382.81 196.57 3,146.64 113.56 62.09 26.82 21,825.02 21,825.02
construction contract costs Fees for technical services / design and drawings Diesel and fuel expenses operation and maintenance expenses provision for overlay expenses periodic maintenace expenses toll plaza expenses negative grant to nHai ToTAL
NOTE 28 : EMPlOYEE BENEfITS EXPENSE
Particulars Salaries and wages contribution to provident and other funds (refer foot notes below) Staff welfare expenses ToTAL fooTNoTe: (i) employee benefit obligations: (a) Defined-contribution plans Year ended March 31, 2012 2,941.36 655.45 97.10 3,693.91 3,693.91
` in million Year ended March 31, 2011 2,870.22 56.06 595.30 3,521.58 3,521.58
(i) the group offers its employees defined contribution benefits in the form of provident fund, family pension fund and superannuation fund. provident fund, family pension fund and superannuation fund cover substantially all regular employees. contributions are paid during the year into separate funds under certain statutory / fiduciary-type arrangements. while both the employees and the group pay predetermined contributions into the provident fund and pension fund, contributions to superannuation fund are made only by the group. the contributions are normally based on a certain proportion of the employee’s salary (ii) a sum of ` 23.84 million (previous year ` 14.64 million) has been charged to the consolidated Statement of profit and loss in this respect (B) Defined–benefit plans: the group offers its employees defined-benefit plans in the form of gratuity (a lump sum amount). amounts payable under defined benefit plans are typically based on years of service rendered and the employee’s eligible compensation (immediately before retirement). the gratuity scheme covers substantially all regular employees. in the case of the gratuity scheme, the group contributes funds to the life insurance corporation of india which administers the scheme on behalf of the group. commitments are actuarially determined at year end. actuarial valuation is based on “projected unit credit” method. gains and losses due to changes in actuarial assumptions are charged to the consolidated Statement of profit and loss
140
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
the net value of the defined-benefit commitment is detailed below: ` in million As at March 31, 2012 57.39 56.35 1.04 As at March 31, 2011 41.65 46.28 0.64 (3.99)
present value of commitment Fair value of plans unrecognised past service cost Payable / ( Prepaid) amount taken to the balance sheet Defined benefit commitments:
` in million gratuity opening balance interest cost current service cost Benefits paid actuarial (gain) / loss transferred from / to other company Closing balance plan assets: ` in million gratuity opening balance expected return on plan assets contributions by the company / group Benefits paid transferred from / to other company actuarial gain / (loss) other adjustments fair value of plan assets As at March 31, 2012 46.31 4.11 11.82 (7.19) 1.17 0.15 (0.02) 56.35 As at March 31, 2011 35.27 3.24 14.30 (5.79) (1.82) 1.11 46.31 As at March 31, 2012 41.65 3.25 14.21 (7.19) 4.30 1.17 57.39 As at March 31, 2011 28.80 2.23 12.22 (5.79) 6.65 (2.46) 41.65
the plan assets are managed by life insurance corporation of india and HDFc Standard life insurance and the group does not have details as to the investment pattern return on plan assets: ` in million gratuity expected return on plan assets actuarial gain / (loss) actual return on plan assets Year ended March 31, 2012 4.11 0.15 4.26 Year ended March 31, 2011 3.24 1.11 4.35
141
transportation
annual report 2011-12
Notes
gratuity
forming part of the Consolidated Financial statements for the year ended March 31, 2012
expenses on defined benefit plan recognised in the consolidated Statement of profit and loss: ` in million Year ended March 31, 2012 14.21 3.25 (4.11) 4.15 17.50 Year ended March 31, 2011 12.22 2.23 (3.24) 5.53 16.74
current service cost interest expenses expected return on investments net actuarial (gain) / loss expenses charged to Consolidated statement of Profit and Loss
(i) the actuarial calculations of estimated defined benefit commitments and expenses are based on the following assumptions, which if changed would affect the defined benefit commitment’s size, funding requirements and pension expense Name of the Entity Year Ended March 31, 2012 group entities other than a jointly controlled entity rate for discounting liabilities expected salary increase rate expected return on scheme assets attrition date Mortality table used 8.25%-8.50% 6.00%-6.50% 8.00% 2% lic (1994-96) ultimate Jointly controlled entity Year Ended March 31, 2011 group entities other than a jointly controlled entity 8.25% 4.50%-6.00% 8.00% -8.25% 2% lic (1994-96) ultimate Jointly controlled entity
8.25%-8.50% 6.50% 6.50% not disclosed not disclosed
8.25% 6.00% 5.00% not disclosed not disclosed
(ii) the estimates of future salary increases considered in the actuarial valuation take into account inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market (iii) the amounts of the present value of the obligation, fair value of the plan assets, surplus or deficit in the plan, experience adjustments arising on plan liabilities and plan assets for the current period and previous three annual periods is given below: ` in million gratuity (funded Plan) Defined benefit commitments plan assets unfunded liability transferred from group companies (surplus) / Deficit As at As at As at As at As at March 31, 2012 March 31, 2011 March 31, 2010 March 31, 2009 March 31, 2008 57.39 56.35 1.04 41.65 46.28 0.64 (3.99) 28.80 35.27 (6.47) 21.50 (26.41) (4.91) 21.64 (23.07) 0.07 (1.36) ` in million gratuity (funded Plan) experience adjustments commitments experience assets adjustments on on plan plan Year ended Year ended Year ended Year ended Year ended March 31, 2012 March 31, 2011 March 31, 2010 March 31, 2009 March 31, 2008 (0.40) (0.35) 4.32 1.11 (0.87) 0.15 6.22 (1.34) 8.99 (0.93)
(iv) the contribution expected to be made by some of the constituents of the group during the financial year 2012-13 is ` 49.82
142
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
Particulars
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 29 : fINANcE cOSTS
Year ended March 31, 2012 6,599.57 80.44 135.12 26.38 440.56
` in million Year ended March 31, 2011 3,825.82 217.43 3.06 37.62 896.65
Interest expenses interest on loans for fixed period interest on debentures interest on deep discount bonds (b) other finance charges guarantee commission Finance charges ToTAL
(a)
6,815.13
4,046.31
466.94 7,282.07
934.27 4,980.58
NOTE 30 : ADMINISTRATIvE AND gENERAl EXPENSES
Particulars legal and consultation fees travelling and conveyance rent rates and taxes repairs and maintenance others Bank commission communication expenses insurance exchange rate fluctuation loss (net) printing and stationery electricity charges Bad debts and provision for doubtful debts loss on sale of fixed assets (net) Brand subscription fees Miscellaneous expenses ToTAL Year ended March 31, 2012 274.52 338.33 488.10 72.87 103.98 232.26 67.08 140.87 38.37 34.77 316.85 3.30 218.25 880.63 3,210.18 3,210.18
` in million Year ended March 31, 2011 273.78 283.56 468.34 113.84 89.78 98.76 68.42 106.71 6.57 54.17 18.33 51.99 10.78 140.36 431.71 2,217.10 2,217.10
NOTE 31 : EARNINgS PER EQUITY SHARE
Particulars profit for the year premium on preference shares of subsidiary Dividend tax on premium on preference shares of subsidiary profit available for equity Shareholders weighted average number of equity Shares outstanding nominal value per equity share Basic earnings per share weighted average number of equity shares used to compute diluted earnings per share Diluted earnings per share Unit ` in million ` in million ` in million ` in million number ` ` number ` Year ended March 31, 2012 4,969.58 (16.19) (2.63) 4,950.76 194,267,732 10.00 25.48 194,267,732 25.48
` in million Year ended March 31, 2011 4,328.79 (16.14) (2.68) 4,309.97 194,267,732 10.00 22.19 194,267,732 22.19
in the absence of clarity as to the impact of advance towards capital on the earnings of the group, no adjustment has been made for potential dilution in computing diluted earnings per share
143
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 32 : INvESTMENTS IN AHA
investments in airport Holding australasia pte limited (aHa) has not been considered as investments in associates as in the view of the Management, no significant influence exist
NOTE 33 : DISclOSURE IN TERMS Of AccOUNTINg STANDARD (AS) 7 – cONSTRUcTION cONTRAcTS
Particulars contract revenue recognised as revenue during the year ended aggregate amount of contract costs incurred recognised profits up to gross amount due from customers for contract work, disclosed as asset, as at gross amount due to customers for contract work, disclosed as liability as at the As at March 31, 2012 764.69 545.91 As at March 31, 2011 1,230.32 1,230.32 6.38 208.47
` in million
NOTE 34 : DISclOSURE Of lEASES
(A) operating Lease: the group holds certain properties under a non-cancellable operating lease. the group’s future lease rentals under the operating lease arrangements as at the year-end are as under: (a) For entities other than jointly controlled entities ` in million future lease rentals within one year over one year but less than 5 years More than 5 years Year ended March 31, 2012 365.87 161.83 44.80 Year ended March 31, 2011 345.26 130.76 76.02
the lease terms do not contain any exceptional / restrictive covenants nor are there any options given to group to renew the lease or purchase the properties. the agreements provide for changes in the rentals if the taxes leviable on such rentals change ` in million Particular amount charged to the consolidated Statement of profit and loss for rent (b) finance Leases: (a) Subsidiaries ` in million Particular March 31, 2012 Minimum Present value of lease lease minimum lease charges Payment payments amount payable not later than one year amount payable >1 but < 5 years amount payable > 5 years ToTAL 71.56 83.17 41.32 196.05 65.22 71.16 38.90 175.28 6.34 12.00 2.41 20.75 March 31, 2011 Minimum Present value lease lease of minimum charges Payment lease payments 135.87 104.98 44.96 285.81 128.96 95.40 41.85 266.21 6.91 9.58 3.11 19.60 for the year ended March 31, 2012 434.54 for the year ended March 31, 2011 323.60
144
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
(b) Jointly controlled entities a jointly controlled entity had taken a vehicle under finance lease. the reconciliation of minimum lease payments and their present value is as under: ` in million Particular March 31, 2012 Minimum Present value of lease lease minimum lease charges Payment payments amount payable < 1 year amount payable >1 but < 5 years ToTAL March 31, 2011 Minimum Present value lease lease of minimum charges Payment lease payments 0.12 0.12 0.11 0.11 0.00 0.00
NOTE 35 : the group’s percentage holding in various jointlly controlled entities are given below:
Name of the jointly controlled entity ntBcl JSel nel yuhe (from December 27, 2011) As at As at March 31, 2012 March 31, 2011 % holding 25.35 50.00 50.00 49.00 % holding 25.35 50.00 50.00 -
the proportionate share in assets, liabilities, income and expenditures of above jointly controlled entities as included in these cFS is given below: ` in million Particulars Assets Fixed assets (net) Deferred tax assets loans and advances (current and non-current) other non-current assets current investments other current assets equity and Liabilities reserves and surplus loans Deferred tax liability other liabilities As at March 31, 2012 19,642.53 2.21 388.24 2,225.33 89.90 255.83 22,604.04 749.81 10,928.58 183.95 1,034.61 12,896.95 As at March 31, 2011 2,559.32 431.37 1,201.30 60.23 968.56 5,220.78 1,535.83 751.47 15.34 1,234.86 3,537.50
145
transportation
annual report 2011-12
Notes
Particulars Income
forming part of the Consolidated Financial statements for the year ended March 31, 2012
` in million for the year ended for the year ended March 31, 2012 March 31, 2011 4,188.17 24.44 4,212.61 expenses operating expenses administrative and general expenses Depreciation and amortization expense Finance costs taxes - current tax - Deferred tax 466.52 149.73 110.23 282.49 13.46 166.45 1,188.88 1,200.09 76.41 10.03 106.67 7.36 15.34 1,415.90 ` in million Particulars contingent liabilities capital commitments As at March 31, 2012 5,725.12 As at March 31, 2011 12.51 8,814.16 2,454.15 22.61 2,476.76
revenue from operations other income
NOTE 36 :
the concession arrangements of the group relate primarily to the construction, operation and maintenance of carriageways (roads) and gas stations by special purpose entities within the group, which at the end of the concession period must be returned in the stipulated conditions to the grantors of the concessions. in consideration for having designed, constructed, operated and maintained such carriageways, the group is entitled either to “annuities” from grantors or is entitled charge “toll” to the users of the carriageways or in the case of gas stations, to compensation from the oil companies besides other revenue from ancillary commercial activities (i) the following are toll based service concession arrangements of the group which have been classified as “intangible assets” in the note 13 to the financial statements: a) the vadodara Halol road project (“vHrp”) and the ahmedabad Mehsana road project (“aMrp”) are concession arrangements entered into with the government of gujarat through gujarat road and infrastructure company limited (“gricl”). the construction activities of vHrp and aMrp were completed on october 24, 2000 and February 20, 2003 respectively. Maintenance activities cover routine maintenance, overlays and renewals. the concessions, which have been granted for periods of 30 years from those dates, envisage that gricl will earn a designated return over the concession periods. in the event gricl is unable to earn the designated return gricl would be entitled to an extension by two years at a time until the project cost and the returns thereon are recovered by it. the amount of toll recoverable from users is linked to the movements in the consumer price index and to custom escalators. premature termination before the said period of 30 years is not permitted except in the event of a force majeure. premature termination without the default on the part of gricl will entitle gricl to the cost of the project and return thereon remaining to be recovered as on the date of transfer. at the end of the concession period, gricl is required to hand back the carriageway to the grantor at a nominal consideration
146
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
b) the Delhi noida Bridge project (“DnBp”) concession arrangement has been entered into between the new okhla industrial Development authority (noiDa) and noida toll Bridge company limited (“ntBcl”). the construction activity was completed on February 7, 2001. Maintenance activities cover routine maintenance, overlays and renewals. the concession, which has been granted for a period of 30 years from February 7, 2001, envisages that ntBcl will earn a designated return over the concession periods. in the event ntBcl is unable to earn the designated return, ntBcl would be entitled to an extension by two years at a time until the project cost and the returns thereon are recovered by it. the amount of toll recoverable from users is linked to the movements in the consumer price index. premature termination before the said period of 30 years is not permitted except in the event of a force majeure. premature termination without default on the part of ntBcl will entitle ntBcl to the cost of the project and returns thereon remaining to be recovered as on the date of transfer. at the end of the concession period, ntBcl is required to hand back the carriageway to the grantor at a nominal consideration c) elsamex Sa, its subsidiaries and joint ventures, (the “elsamex group”) have entered into Service concession arrangements(“Sca”) for construction and operation and maintenance of five gas stations in Spain and for the construction and operation and maintenance of a road project in Spain with the government authorities the periods for which the Scas have been granted are as under: Operations and Maintenance period
Project orihuela gas Station villavidel gas Station Zamora gas Station ponferrada gas Station coiros gas Station a4 road alcantarilla Fotovoltaica, S.l.u.
Date of ScA June 11, 2001
Status construction completed
Termination date
25 years and 8 months June 11, 2030 from november 11, 2004 40 years and 1.5 months September 12, 2045 from July 29, 2004 43 years and 4 months June 24, 2048 from February 23, 2005 45 years and 10 months august 04, 2050 from october 26, 2006 39 years 19 years 25 years april 14, 2043 December 26, 2026 november 10, 2035
September 12, 2001 construction completed June 24, 2002 august 4, 2004 april 16, 2004 construction completed construction completed under construction
December 27, 2007 under construction november 11, 2010 under construction
Maintenance activities for the gas stations and road project include routine operating and maintenance as well as periodic overhauling and refurbishment to maintain the stations to the defined standards. in consideration for performing its obligations under the Sca, elsamex is entitled to compensation from the oil companies computed at a predefined proportion of the sale of products at the gas stations and in the form of a “shadow toll” based on the units of usage i.e. the number of vehicles using the road in respect of road project d) the Beawar gomti road project (“Bgrp”) concession arrangement has been entered into between the president of india, represented by Special Secretary and Director general (road Development), (“DortH”) and itnl road infrastructure Development company limited (“iriDcl”). iriDcl is required to design, build, finance and operate the Bgrp for a period of 30 years commencing from the appointed date i.e. october 28, 2009, provided that in the event of four-laning not being undertaken for any reason in accordance with the provisions of concession agreement, the concession period shall be deemed to be 11 years including construction period of 455 days for 2- laning of the Bgrp Maintenance activities cover routine maintenance, . overlays and renewals. premature termination before the said period of concession is not permitted except
147
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
in the event of a force majeure. premature termination without the default on the part of irDcl will entitle iriDcl to be eligible for the compensation as per the concession arrangement. at the end of the concession period, iriDcl is required to hand back Bgrp to the grantor without additional consideration e) the Jetpur-gondal-rajkot road project (“Jgrrp”) is a concession arrangement entered into between the national Highways authority of india (“nHai”) and west gujarat expressway limited (“wgel”). the concession has been granted to wgel for a period of 20 years ending on September 17, 2025. the construction activity was completed on March 17, 2008. Maintenance activities cover routine maintenance, overlays and renewals. in consideration, wgel will be entitled to collect toll/user charges from the users of Jgrrp the amount of . toll recoverable from users is linked to the movements in the wholesale price index. also on dates specified in the concession agreement, wgel will be entitled to a “grant” by way of cash support from nHai, but it also obligated to pay a “negative grant” by way of cash payment to nHai. premature termination before the said period of 20 years is not permitted except in the event of a force majeure. the concession does not provide for renewal options. at the end of the concession period, Jgrrp is required to hand back the carriageway to the grantor without additional consideration f) the pune Sholapur road project (“pSrp”) concession arrangement has been entered into between nHai and pune Sholapur road Development company limited (“pSrDcl”). pSrDcl is required to design, build, finance and operate the pSrp for a period of 20 years commencing from the appointed date including construction period of 910 days. Maintenance activities cover routine maintenance, overlays and renewals. the amount of toll recoverable from users is linked to the movements in the consumer price index. premature termination before the said period of concession is not permitted except in the event of a force majeure. premature termination without the default on the part of pSrDcl will entitle pSrDcl to be eligible for the compensation as per the concession arrangement. at the end of the concession period, pSrp is required to hand back the carriageway to the grantor without additional consideration g) the Moradabad Bareilly road project (“MBrp”) is a concession arrangement entered into between nHai and Moradabad Bareilly expressway limited (“MBel”). MBel is required to design, build, finance, operate and transfer the MBrp for a period of 25 years commencing from the appointed date including construction period of 910 days. Maintenance activities cover routine maintenance, overlays and renewals. the amount of toll recoverable from users is linked to the movements in the consumer price index. premature termination before the said period of concession is not permitted except in the event of a force majeure. premature termination without default on the part of MBel will entitle MBel to be eligible for compensation as per the concession. at the end of the concession period, MBrp is required to hand back the carriageway to the grantor without additional consideration h) the company has entered into a concession contract agreement with Haryana urban Development authority (HuDa) on 9 December, 2009 for development of Metro rail project from Delhi Metro Sikanderpur Station on Mg road, gurgaon to nH-8 (‘the project’). as per the terms of the contract, the company accepts the concession for a period of 99 years commencing from the effective date, to develop and operate the project. the company has not yet started any significant construction activity, therefore intangible asset covered under ‘Service concession arrangement’ have been carried at cost i) the narketpally adanki project (“nap”) is a concession arrangement entered into between andhra pradesh road Development corporation and n. a. M. expressway limited (“nel”). nel is required to design, build, finance, operate and transfer the nap for a period of 24 years commencing from the appointed date including construction period of 30 months. Maintenance activities cover routine maintenance, overlays and renewals. the amount of toll recoverable from users is linked to the movements in the consumer price index. premature termination before the said period of concession is not permitted except in the event of a force majeure. premature termination without default on the part of nel will entitle nel to be eligible for compensation as per the concession. at the end of the concession period, nap is required to hand back the carriageway to the grantor without additional consideration
SuStainaBle that’s itnl for you
148
SaFe
SoliD
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
j)
forming part of the Consolidated Financial statements for the year ended March 31, 2012
Mp Border checkpost project (“MpBcp”) is a concession agreement granted by Mp road Development corporation limited (MprDcl) for construction, operation and maintenance of the Border checkposts at 24 locations in Madhya pradesh to Mp Border checkpost Development company ltd (MpBcDcl) for a period of 4566 days commencing from the appointed date. as per the concession agreement, MpBcDcl has obligation to undertake the design, engineering, procurement, construction, operation and maintenance of the project in consideration, the company is entitled to collect service fees from the users in accordance with the concession agreement. at the end of the concession period, the company will hand over the infrastructure to MprDcl
k) the Kiratpur net chowk project (“Kncp”) is a concession arrangement entered into between national Highways authority limited and Kiratpur net chowk expressway limited (“Kncel”). Kncel is required to build, operate and transfer the Kncp for a period of 28 years commencing from the appointed date including construction period of 30 months. Maintenance activities cover routine maintenance, overlays and renewals. the amount of toll recoverable from users is linked to the movements in the consumer price index. premature termination before the said period of concession is not permitted except in the event of a force majeure. premature termination without default on the part of Kncel will entitle Kncel to be eligible for compensation as per the concession l) the chongqing yuhe expressway project (“cyep”) is a concession arrangement entered into between people’s repubic of china and chongqing yuhe expressway company limited (“yuhe”). the government has granted the right to charge the users of chongqing yuhe expressway for a period of 20 years to yuhe. the premature termination before the said period of concession is not permitted except in the event of a force majeure
(ii) the following are annuity based service concession arrangements of the group which have been classified as financial assets under “receivables against service concession arrangements” in the financial statements in note 19: a) the north Karnataka expressway project (“nKep”) is a concession arrangement granted by national Highways authority of india (“nHai”) for a period of 17 years and 6 months from June 20, 2002 to north Karnataka expressway limited (“nKel”). the construction activities were completed on July 19, 2004. Besides construction, nKel’s obligations include routine maintenance and period maintenance of the flexible pavement and the rigid pavement at predefined intervals. in consideration, nKel is entitled to a defined annuity. at the end of the concession period nKep is required to be handed over in a stipulated condition to the grantor. premature termination is permitted only upon the happening of a force majeure event or upon the parties defaulting on their obligations. the concession arrangement does not provide for renewal options b) the Hyderabad outer ring road (“Horr”) is a concession arrangement granted by Hyderabad urban Development authority (“HuDa”) for a period of 16 years including construction period of 3 years from august 31, 2007 to east Hyderabad expressway limited (“eHel”). Besides construction, eHel’s obligations include routine maintenance and period maintenance of the flexible pavement and the rigid pavement at predefined intervals. in consideration, eHel is entitled to a defined annuity. at the end of the concession period Horr is required to be handed over in a stipulated condition to the grantor. premature termination is permitted only upon the happening of a force majeure event or upon the parties defaulting on their obligations. the concession arrangement does not provide for renewal options c) the Hazaribagh ranchi road project (“Hrrp”) is a concession arrangement granted by the “nHai” for a period of 18 years including construction period of 910 days from october 8, 2009 to Hazaribagh ranchi expressway limited (“Hrel”). Besides construction, Hrel’s obligations include routine maintenance and period maintenance of the flexible pavement and the rigid pavement at predefined intervals. in consideration Hrel is entitled to a defined annuity. at the end of the concession period Hrrp is required to be handed over in a stipulated condition to the grantor. premature termination is permitted only upon the happening of a force majeure event or upon the parties defaulting on their obligations. the concession arrangement does not provide for renewal options 149
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
d) as per the concession agreements dated September 23, 2009 in respect of the ranchi ring road project (“rrrp”) and on october 14, 2009 in respect of the ranchi - patratu Dam road project (“rpDrp”) and patratu Dam- ramgarh road project (“pDrrp”) with the govt. of Jharkhand (“goJ”) and Jharkhand accelerated road Development company limited (“JarDcl”), Jharkhand road project implementation company limited (“Jrpicl”) is required to develop, design, finance, procure, engineering, construct, operate and maintain the rrrp rpDrp and pDrrp for a period of 17 years and six months from commencement date. Besides , construction, Jrpicl’s obligations include routine maintenance and period maintenance of the flexible pavement and the rigid pavement at predefined intervals. in consideration, Jrpicl is entitled to a defined annuity. at the end of the concession period rrrp rpDrp and pDrrp are required to be handed over in , the stipulated condition to the grantor. premature termination is permitted only upon the happening of a force majeure event or upon the parties defaulting on their obligations. the concession arrangements do not provide for renewal options e) the chenani nashri tunnel project (“cntp”) is a concession arrangement granted by the “nHai” for a period of 20 years including construction period of 1825 days to chenani nashri tunnelway limited (“cntl”). Besides construction, cntl’s obligations include routine maintenance of the projects and if required, modify, repair, improvements to the project highway to comply with specification and standards. in consideration cntl is entitled to a defined annuity. at the end of the concession period cntp is required to be handed over in a stipulated condition to the grantor. the concession arrangement does not provide for renewal options f) the Jorabat Shillong project (“JSp”) is a concession arrangement granted by the “nHai” for a period of 20 years including construction period of three years form appointed date to Jorabat Shillong expressway limited (“JSel”). Besides construction, JSel’s obligations include routine maintenance and period maintenance of the flexible pavement and the rigid pavement at predefined intervals. in consideration JSel is entitled to a defined annuity. at the end of the concession period JSel is required to be handed over in a stipulated condition to the grantor. premature termination is permitted only upon the happening of a force majeure event or upon the parties defaulting on their obligations. the concession arrangement does not provide for renewal options
NOTE 37 :
Segment reporting - refer annexure - i
NOTE 38 :
related party Disclosure - refer annexure ii
NOTE 39 :
Statement to be furnished under section 212 (8) of companies act, 1956 relating to subsidiaries includes the financial information of the subsidiaries received for the purpose of preparation of the consolidated financials statements refer annexure iii
NOTE 40 :
previous year : consequent to the notiFication no. S.o. 447(e), DateD 28-2-2011 [aS aMenDeD By notiFication no. F.no. 2/6/2008-cl-v, DateD 30-3-2011] the above financial statements have been presented in accordance with the revised Schedule vi. as required under the said notification corresponding figures for the previous year have been reclassified and presented in accordance with the current year presentation For and on behalf of the Board K. ramchand Managing Director arun K. Saha Director
george cherian Krishna ghag chief Financial officer company Secretary Bengaluru, May 4, 2012 150
SaFe SoliD SuStainaBle that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 37 : SEgMENT REPORTINg
Surface Transportation Business revenue external inter-Segment segment revenue Segment expenses Segment results unallocated income (excluding interest income) unallocated expenditure Finance cost interest income unallocated tax expense (net) Share of profit / (loss) of associates (net) Share of profit transferred to minority interest (net) Profit for the year segment assets unallocated assets (refer footnote 1) Total assets segment liabilities unallocated liabilities (refer footnote 2) Total liabilities Capital expenditure for the year Depreciation and amortization expense Non cash expenditure other than depreciation for the year
ANNEXURE I
` in million Other Total
2011-2012 2010-2011 2011-2012 2010-2011 2011-2012 2010-2011 54,418.84 54,418.84 40,245.14 14,173.70 38,825.65 38,825.65 27,834.04 10,991.61 1,637.37 1,637.37 1,478.82 158.55 1,656.61 1,656.61 1,500.67 155.94 56,056.21 56,056.21 41,723.96 14,332.25 307.12 442.28 7,282.07 930.95 2,457.21 38.53 457.71 4,969.58 135,636.94 13,269.55 20,355.66 717.25 79,921.95 10,510.70 14,176.37 571.64 1,989.55 1,303.28 48.27 1,627.85 137,626.49 14,853.34 152,479.83 1,140.55 14,572.83 107,334.44 121,907.27 20,355.66 42.55 765.52 447.34 40,482.26 40,482.26 29,334.71 11,147.55 95.22 213.47 4,980.58 691.06 2,242.45 (47.81) 120.73 4,328.79 81,549.80 12,676.15 94,225.95 11,651.25 58,007.36 69,658.61 14,176.37 614.19 612.88
II) seCoNDArY - geogrAPhICAL segmeNTs: ` in million India 2011-12 revenue - external Segment assets capital expenditure 48,112.63 113,289.26 19,566.64 Outside India 2011-12 30,830.94 72,056.38 13,927.36 India 2010-11 7,943.58 24,337.22 789.02 Outside India 2010-11 9,650.52 9,493.42 249.01
1) unallocated assets include investments, advance towards share application money, loans given, interest accrued, option premium, deferred tax assets, advance payment of taxes (net of provision), unpaid dividend accounts and fixed deposits placed for a period exceeding 3 months, etc 2) unallocated liabilities include borrowings, interest accrued but not due on borrowings, deferred tax liabilities (net), provision for tax (net), unpaid dividends, etc
151
transportation
annual report 2011-12
Notes
i.
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES CUrreNT YeAr
ANNEXURE II
a) name of the related parties and Description of relationship: Nature of Relationship holding Company fellow subsidiaries (only with whom there have been transaction during the year / there was balance outstanding at the year end) Name of Entity infrastructure leasing & Financial Services limited il&FS Financial Services limited il&FS education & technology Services limited il&FS energy Development company limited il&FS environmental infrastructure & Services limited il&FS infrastructure Development corporation limited il&FS investment Managers limited il&FS Maritime infrastructure company limited il&FS urban infrastructure Managers limited chattisgarh Highways Development company limited il&FS global Financial Services (Me) limited il&FS global Financial Services pte limited il&FS Securities Services limited il&FS township & urban assets limited (formerly known as Mppl enterprises limited) il&FS trust company limited Jharkhand accelerated road Development company limited andhra pradesh expressway limited itnl toll Management Services limited thiruvananthpuram road Development company limited warora chandrapur Ballarpur toll road limited centro De investigacion De carreteras De andalucia S.a. cgi-8, S.a. labtec ensayos tecnicos canarios S.a. empresas pame Sa Decv elsamex road technology company limited ramky elsamex Hyderabad ring road Sociedad concesionaria autovia a-4 Madrid S.a. alcantarilla Fotovolcaica Sa Zheisiang elsamex road tech company yala construction company limited-thailand vcS enterprises limited Mr K ramchand-Managing Director and relatives Mr Mukund Sapre-executive Director and relatives Acronym used ilFS iFin ietS ieDcl ieiSl iiDcl iiMl iMicl iuiMl cHDcl igFSMl igFSpl iSSl itual itcl JarDcl apel itMSl trDcl wcBtrl cican cgi-8 laBtec epSD ertc reHrr a4 conceSSion aFSa Zheisiang elsamex thailand vcSel
Associates
Key management Personnel
152
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
b) transactions/ balances with above mentioned related parties (mentioned in note 38 (i) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives
Total
bALANCes: Advance towards capital in a subsidiary ilFS Interest accrued (current and non-current) ilFS apel trDcl otHerS Inter-corporate deposits ilFS Investment in Debentures apel Investment in Covered Warrants ilFS short-term Lendings apel trDcl otHerS Long-term Lendings apel a4 conceSSion trDcl otHerS Advances recoverable in Cash or Kind apel a4 conceSSion Zheisiang elsamex otHerS Trade Payables ilFS iFin otHerS
150.00 150.00 21.11 21.11 673.30 673.30 1,693.00 1,693.00 -
1.56 1.56 73.00 73.00 -
312.38 43.06 1.97 357.41 786.40 786.40 751.00 215.00 34.00 1,000.00 474.60 373.87 171.80 217.02 1,237.29 1.63 1.63 13.19 13.19
-
150.00 150.00 21.11 312.38 43.06 3.53 380.08 673.30 673.30 786.40 786.40 1,693.00 1,693.00 751.00 215.00 107.00 1,073.00 474.60 373.87 171.80 217.02 1,237.29 1.63 1.94 12.14 0.20 15.91 62.57 476.08 141.67 680.32
62.57 62.57
1.94 12.14 0.20 14.28 476.08 128.48 604.56
-
153
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
a) transactions/ balances with above mentioned related parties (mentioned in note 38 (i) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives
Total
Trade receivables ilFS iFin a4 conceSSion wcBtrl otHerS
16.42 16.42
387.15 0.26 387.41
613.86 599.00 348.18 1,561.04
-
16.42 387.15 613.86 599.00 348.44 1,964.87
Unsecured Loans and Advances from related Parties ilFS
288.00 288.00
-
-
-
288.00 288.00
option premium assets (Long-term loans and advances) ilFS (net of provision of ` 163.28 million) Long-term borrowings ilFS
36.67 36.67 732.82 732.82
-
-
-
36.67 36.67 732.82 732.82
redemption premium accrued but not due on borrowings ilFS Current liabilities ilFS
291.02 291.02 28.73 28.73
. -
-
-
291.02 291.02 28.73 28.73
Transactions Inter-corporate deposits - matured ilFS
Inter-corporate deposits - placed ilFS operating expenses ilFS ieiSl
6,203.19 6,203.19 6,606.49 6,606.49 0.58 0.58
11.87 11.87
-
-
6,203.19 6,203.19 6,606.49 6,606.49 0.58 11.87 12.45
154
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURE - (contd.)
a) transactions/ balances with above mentioned related parties (mentioned in note 38 (i) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives 2.75 2.75 -
Total
Lendings apel trDcl otHerS repayment of Lendings apel other Income ilFS apel otHerS revenue from operations iFin wcBtrl apel otHerS Administrative and general expenses ilFS ietS otHerS Investment made / purchased ilFS wcBtrl otHerS borrowings ilFS repayment of borrowings ilFS iSSl Interest on Loans (expense) ilFS otHerS
57.29 57.29 302.09 302.09 1,187.50 1,187.50 800.00 800.00 903.89 903.89 182.67 182.67
73.00 73.00 1.73 1.73 390.00 0.14 390.14 43.59 26.88 70.47 0.00 0.00 1,000.00 1,000.00 4.27 4.27
791.00 165.00 956.00 651.00 651.00 230.49 61.99 292.48 371.71 116.42 26.06 514.19 17.44 17.44 616.91 616.91 -
791.00 165.00 73.00 1,029.00 651.00 651.00 57.29 230.49 63.72 351.50 390.00 371.71 116.42 26.20 904.33 302.09 43.59 47.07 392.75 1,187.50 616.91 0.00 1,804.41 800.00 800.00 903.89 1,000.00 1,903.89 182.67 4.27 186.94
155
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
a) transactions/ balances with above mentioned related parties (mentioned in note 38 (i) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives -
Total
finance charges ilFS iFin itcl itual igFSMl otHerS Intangible assets under development ilFS iFin otHerS
3.43 3.43 35.01 35.01
62.51 49.65 55.15 37.76 15.72 220.79 125.63 12.92 138.55
-
3.43 62.51 49.65 55.15 37.76 15.72 224.22 35.01 125.63 12.92 173.56
redemption of Non convertible Debentures ilFS
36.00 36.00
-
-
-
36.00 36.00
guarantee commision ilFS
15.29 15.29
-
-
-
15.29 15.29
Dividend paid ilFS
472.74 472.74
-
-
-
472.74 472.74
Director remuneration Mr. K ramchand Mr. Mukund Sapre
-
-
-
53.08 28.77 81.85
53.08 28.77 81.85
156
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
ii. PrevIoUs YeAr a) name of the related parties and description of relationship: Nature of Relationship holding Company fellow subsidiaries (only with whom there have been transaction during the year / there was balance outstanding at the year end) Name of Entity infrastructure leasing & Financial Services limited il&FS Financial Services limited (erst while il&FS Finvest ltd.) il&FS ecosmart limited (upto March 29, 2011) il&FS education & technology Services limited il&FS energy Development co ltd (from December 3, 2010) il&FS environmental infrastructure & Service limited (formerly il&FS waste Management & urban Services limited) il&FS infrastructure Development corporation limited il&FS investment Managers limited il&FS Maritime infrastructure company limited il&FS property Management & Services limited (upto october 1, 2010) il&FS renewable energy limited chattisgarh Highway Development company limited il&FS Securities Services limited il&FS trust company limited il&FS water limited Jharkhand accelerated road Development company limited tamil nadu water investment company limited il&FS cluster Development initiative limited il&FS global Financial Services (uK) limited il&FS urban infrastructure Managers limited il&FS urban infrastructure Services limited (upto March 29, 2011) andhra pradesh expressway limited itnl toll Management Services limited thiruvananthpuram road Development company limited warora chandrapur Ballarpur toll road limited labtec ensayos tecnicos canarios S.a. centro De investigacion De carreteras De andalucia S.a. cgi-8, S.a. empresas pame Sa Decv (from april 28, 2010) ramky elsamex Hyderabad ring road Sociedad concesionaria autovia a-4 Madrid S.a. Zheisiang elsamex road tech company yala construction company limited vcS enterprises limited Mr. K ramchand-Managing Director and relatives Mr. Mukund Sapre-executive Director and relatives
ANNEXURE II
Acronym used ilFS iFin iel ietS ieDcl ieiSl iiDcl iiMl iMicl ipoMSl irel cHDcl iSSl itcl iwl JarDcl twicl icDil igFSl(uK) iuiMl iuiSl apel itMSl trDcl wcBtrl laBtec cican cgi-8 epSD reHrr a4 conceSSion Zheisiang elsamex thailand vcSel
Associates
Key management personnel
157
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
b) transactions / balances with above mentioned related parties (mentioned in note 38 (ii) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives
Total
bALANCes: Advance towards capital in a subsidiary (Included in minority Interest) ilFS Advance Towards share application money made wcBtrl Current liabilities ilFS Investments in Covered Warrants ilFS option premium assets (Long-term loans and advances) ilFS (net of provision of ` 64.77 million) Interest Accrued (asset) ilFS apel others Interest accrued and not due on borrowings iSSl Inter-corporate deposits ilFS short-term lendings apel trDcl Long-term lendings apel trDcl a4 concession
150.00 150.00 28.73 28.73 648.00 648.00
-
616.91 616.91 -
-
150.00 150.00 616.91 616.91 28.73 28.73 648.00 648.00
136.43 136.43 5.66 5.66 270.00 270.00 -
34.94 34.94 -
319.13 12.15 331.28 610.99 50.00 660.99 474.60 171.80 640.71 1,287.11
-
136.43 136.43 5.66 319.13 12.15 336.94 34.94 34.94 270.00 270.00 610.99 50.00 660.99 474.60 171.80 640.71 1,287.11
158
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
b) transactions / balances with above mentioned related parties (mentioned in note 38 (ii) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives -
Total
Long-term borrowings ilFS
1,302.86 1,302.86 18.98 18.98 33.59 33.59 0.32 0.32 -
1,000.00 1,000.00 415.31 50.74 466.05 1.29 1.29 2.68 2.68 0.79 0.36 0.00 1.15
786.40 786.40 9.75 9.75 189.00 102.89 562.90 111.69 156.71 1,123.19 8.28 8.28 -
1,302.86 1,302.86 1,000.00 18.98 1,018.98 786.40 786.40 33.59 415.31 60.49 509.39 189.00 102.89 562.90 111.69 158.00 1,124.48 0.32 8.28 2.68 11.28 0.79 0.36 0.00 1.15
short-term borrowings iSSl ilFS Investments in Debentures apel
Trade payables ilFS iFin others Trade receivables wcBtrl trDcl a4 concession Zhesiang elsamex others Advances recoverable in Cash or Kind ilFS apel others secured Deposit ietS iel otHerS
Transactions Advance Towards share application money made ilFS wcBtrl
finance costs ilFS iFin others
30.00 30.00 3.36 3.36
632.84 13.07 645.91
616.91 616.91 -
-
30.00 616.91 646.91 3.36 632.84 13.07 649.27
159
transportation
annual report 2011-12
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
b) transactions / balances with above mentioned related parties (mentioned in note 38 (ii) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives -
Total
Investments made / purchased ilFS Interest on Loans (expense) ilFS iSSl Inter-corporate deposits - matured ilFS Inter-corporate deposits - placed ilFS Lendings trDcl apel borrowings ilFS iSSl repayment of Lendings apel repayment of borrowings ilFS sale of Assets ilFS other Income ilFS apel others revenue from operations apel wcBtrl others
148.00 148.00 383.99 383.99 7,980.00 7,980.00 8,776.22 8,776.22 5,580.00 5,580.00 5,719.89 5,719.89 0.07 0.07 23.61 23.61 -
49.01 49.01 1,000.00 1,000.00 4.89 4.89 -
221.80 45.00 266.80 264.00 264.00 227.85 66.57 294.42 110.91 210.00 64.74 385.65
148.00 148.00 383.99 49.01 433.00 7,980.00 7,980.00 8,776.22 8,776.22 221.80 45.00 266.80 5,580.00 1,000.00 6,580.00 264.00 264.00 5,719.89 5,719.89 0.07 0.07 23.61 227.85 71.46 322.92 110.91 210.00 64.74 385.65
160
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS consolidated
Notes
forming part of the Consolidated Financial statements for the year ended March 31, 2012
NOTE 38 : RElATED PARTY DISclOSURES - (contd.)
b) transactions / balances with above mentioned related parties (mentioned in note 38 (ii) (a) above)
ANNEXURE II
` in million
Particulars
Holding company
fellow SubAssociates sidiaries
Key Management personnel and relatives 0.74 0.74
Total
Administrative and general expenses ilFS iFin others
202.78 202.78
69.62 66.27 135.89
-
202.78 69.62 67.01 339.41
Intangible assets under development ilFS iFin others
8.29 8.29
76.16 3.40 79.56
-
-
8.29 76.16 3.40 87.85
operating expenses ilFS iSSl others
22.71 22.71
0.03 0.39 0.42
-
-
22.71 0.03 0.39 23.13
refund of Advance Towards share application money trDcl
-
-
0.25 0.25
-
0.25 0.25
guarantee commission ilFS
15.29 15.29
-
-
-
15.29 15.29
Director remuneration Mr. K ramchand Mr. Mukund Sapre
-
-
-
36.85 21.48 58.33
36.85 21.48 58.33
Dividend paid ilFS
405.24 405.24
-
-
-
405.24 405.24
161
162
Notes
NOTE 39 : STATEMENT PURSUANT TO EXEMPTION REcEIvED UNDER SEcTION 212 (8) Of THE cOMPANIES AcT, 1956 RElATINg TO SUBSIDIARIES ANNEXURE III
SaFe Exchange Rate as at March 31, 2012 capital Reserve and Surplus Total Assets Total Revenue 7,186.54 4,219.66 3,680.76 2,081.45 282.92 911.48 2,682.43 8,422.43 7,870.13 13,552.50 18,015.93 14,784.94 12.94 5,764.81 5,993.25 5,484.78 10,358.99 2.22 472.26 62.90 64.84 8,677.10 296.58 8.21 5.09 80.26 81.96 11.88 (2.00) 333.87 (0.09) 2.92 5.66 9.85 19.43 0.11 200.93 109.71 40.03 18.88 1.79 146.40 188.16 84.62 3.31 269.33 5.59 97.38 4,989.81 4.78 (1.06) 142.50 (7.53) 13.70 (5.60) (59.48) 669.18 (145.73) 598.58 44.51 215.84 10.79 1,018.39 34.48 100.06 12.86 102.80 3.39 320.04 9.53 32.24 210.03 178.49 26.66 32.83 2.99 1.01 (10.64) 28.87 6.79 (1.21) 1.60 (1.32) 0.30 4.59 7,436.02 (0.37) 62.03 5.06 85.85 1,543.70 247.51 88.76 80.04 31.64 66.23 47.12 24.40 876.49 7.76 12.14 6.62 11.13 3.54 2.93 266.44 2.49 3,903.88 5.40 (2.26) 3.79 (1.65) (27.50) 10.05 (13.64) 4.15 10.79 4.38 1.13 2.98 0.14 (5.96) (5.19) 1.70 0.48 (0.38) 0.09 10,554.85 10.05 5,296.73 3,988.23 3,697.50 9,372.24 0.10 388.13 62.64 20.17 6,922.14 669.62 69.72 2.29 2,899.23 459.73 681.38 171.96 3,225.10 351.09 16.09 (150.30) (0.43) 343.70 (1.37) (0.24) (3.21) 217.26 0.71 151.46 35.37 124.45 0.98 452.36 1.58 308.27 136.59 226.64 (151.28) (0.43) (1.37) (0.24) (3.21) (1.06) 137.10 (5.27) 9.91 (3.95) (31.98) (155.78) 58.15 6.64 23.69 8.48 2.26 6.55 0.87 (4.68) 34.06 5.09 (1.21) 1.12 (0.94) 0.21 722.41 0.36 2,305.70 8,220.36 5,903.18 8,015.70 14,863.33 32.31 493.76 (189.66) 2.09 1.71 403.63 (168.76) 4,828.23 111.76 2,410.75 214.73 4,956.18 564.77 9,056.26 466.47 37.49 71.11 184.56 147.66 (189.66) 1.71 (168.76) 74.27 143.62 380.21 318.81 4,069.23 3,598.69 3,280.59 383.05 1,086.99 555.95 480.91 (20.81) 506.94 (384.51) 2,280.32 106.70 (321.02) (95.57) 13.53 876.97 74.76 (384.51) 93.17 Profit before taxation Provision for taxation Profit after taxation Proposed dividiend 1.00 1,265.42 1,851.89 1.00 293.10 327.87 1.00 400.00 0.17 1.00 1,680.00 18.40 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 3,720.00 510.09 1.00 0.50 2.39 1.00 163.77 304.31 1.00 593.91 1,411.11 1.00 1,451.04 336.24 51.16 1,340.15 (353.40) 51.16 2.61 (0.49) 1.00 85.50 (1.37) 1.00 0.50 (0.24) 1.00 49.00 (4.33) 1.00 3.16 (1.06) 68.34 1,384.89 2,147.25 68.34 0.21 (0.58) 68.34 68.34 68.34 68.34 68.34 68.34 68.34 1.00 1.00 4.05 4.05 68.34 68.34 68.34 68.34 68.34 4.05 68.34 68.34 0.20 4.10 37.62 6.83 0.06 68.55 36.13 25.46 3.26 (2.06) 118.92 22.47 1.93 977.99 238.84 23.92 51.26 21.18 22.37 38.66 (310.78) 0.91 52.70 22.16 (0.67) 40.32 8.46 8.90 4.10 47.02 50.20 0.96 (227.61) 158.90 (598.39) 1,038.76 (127.64) 400.00 (23.27) 0.50 201.57 1,600.00 366.95 2,216.60 3,320.20 2,451.40 701.20 Total liabilities (Other than shareholder's funds)
Sr. Name of Subsidiary No.
Report- country of ing currency incorporation
SoliD
transportation
SuStainaBle
1 2 3 4
Investments other than investment in subsidiary
5 6 7 8 9 10 11
forming part of the Consolidated Financial statements for the year ended March 31, 2012
that’s itnl for you
12 13 14 15 16 17 18 19 20 21
22 23 24
25 26 27
28 29 30 31 32 33 34
35
36 37 38 39 40
41
annual report 2011-12
42 43
inr india gujarat road and infrastructure company limited east Hyderabad expressway limited inr india itnl road infrastructure Development company limited inr india il&FS rail limited (Formerly known as itnl enso inr india rail Systems limited) vansh nimay infraprojects limited inr india Scheme of itnl road investment trust inr india west gujarat expressway limited inr india Hazaribagh ranchi expressway limited inr india pune Sholapur road Development company limited inr india Moradabad Bareilly expressway limited inr india Jharkhand road projects implementation inr india company limited chenani nashri tunnelway limited inr india Badarpur tollway operations Management limited inr india Mp Border checkpost Development company limited inr india north Karnataka expressway limited inr india rapid Metrorail gurgaon limited inr india itnl international pte. limited uSD Singapore itnl offshore pte. limited uSD Singapore Kiratpur ner chowk expressway limited inr india Karyavattom Sports Facilities limited inr india Futureage infrastructure india limited (Formerly inr india known as global parking plaza limited) charminar robopark limited inr india elsamex Sa euro Spain proyectos y promociones inmobilarias Sanchez euro Spain Marcos S l atenea Seguridad y Medio ambiente S.a. euro Spain Sanchez Marcos Si Sa euro Spain Senalizacion viales e imagen S.a.u. (SeviMagen) euro Spain S.a.u. elsamex internacional Srl euro Spain grusamar ingenieria y consulting Srl euro Spain elsamex portugal ingeniaría e Sg Sa euro portugal intevial gestao integral rodoviaria, S.a. euro portugal elsamex india private limited inr india yala construction co private limited inr india Mantenimiento and conservacion vialidades Sa pesosmeMexico (Mancovi) Mexico construction jicanos eSM Mantenimiento integral de Sa de cv pesosmeMexico jicanos centro De investigación elpidio Sánchez Marcos, S.a. euro Spain control 7, S.a euro Spain geotecnia 7 euro Spain grusamar albania SHpK euro albania area De Servicio coiros S.l. euro Spain conservacion De infraestructuras De Mexico S.a. pesosmeMexico De c.v. jicanos alcantarilla Fotovoltaica, S.l.u. euro Spain area De Servicio punta umbria, S.l.u. euro Spain
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS
Notice
notice is hereby given that the twelfth annual general Meeting of il&FS transportation networks limited will be held at y B chavan auditorium, gen. J. Bhosale Marg, Mumbai 400 021 on thursday, august 9, 2012 at 3.30 p.m. to transact the following business: (d) and all other applicable provisions, if any, of the companies act, 1956 (including any amendments thereto or re-enactment thereof), Foreign exchange Management act, 1999 including rules and regulations framed thereunder, and subject to any other approval, if required, consent of the company be and is hereby accorded to the Board of Directors or committee thereof to borrow by way of loan/ debentures (whether secured or unsecured)/bonds/ deposits for the purpose of the business of the company from the existing limit of ` 3,500 crores to ` 5,000 crores either in indian or Foreign currency from time to time from any bank(s) or any financial institution(s) or any other institution(s), firm(s), body corporate(s) or other person(s) or from any other source in india or outside india for the purpose of working capital requirements of the company, notwithstanding that the moneys to be borrowed together with the moneys already borrowed by the company (apart from temporary loans obtained from the company’s bankers in the ordinary course of business), will exceed the aggregate of the paid up capital of the company and its free reserves, that is to say, reserves not set apart for any specific purposes RESOlvED fURTHER THAT the Board of Directors of the company including any committee thereof be and are hereby authorized to do all such acts, deeds, as the Board may, in its absolute discretion, consider necessary, expedient or desirable including power to sub-delegate, in order to give effect to this resolution or as otherwise considered by the Board to be in the best interest of the company, as it may deem fit” (9) to consider and, if thought fit to pass with or without modification(s), the following resolution as an ordinary resolution: “RESOlvED THAT pursuant to the provisions of Section 293(1)(a) and all other applicable provisions, if any, of the companies act, 1956 (including any amendments thereto or re-enactment thereof), Foreign exchange Management act, 1999 including rules and regulations framed thereunder, and subject to any other approval, if required, consent of the company be and is hereby accorded to the Board of Directors or committee thereof to create, from time to time, such mortgages, charges and hypothecations, in addition to the mortgages/
ORDINARY BUSINESS:
(1) to receive, consider and adopt the Balance Sheet as at March 31, 2012 and the profit and loss account for the financial year ended on that date together with the reports of Directors and auditors thereon to declare a dividend to appoint a Director in place of Mr. Deepak Dasgupta, who retires by rotation and, being eligible offers himself for re-appointment to appoint a Director in place of Mr. Deepak Satwalekar, who retires by rotation and, being eligible offers himself for re-appointment to appoint a Director in place of Mr. vibhav Kapoor, who retires by rotation and, being eligible offers himself for re-appointment to appoint a Director in place of Mr. pradeep puri, who retires by rotation and, being eligible offers himself for re-appointment to appoint auditors and fix their remuneration and in this regard to consider and, if thought fit to pass with or without modification(s), the following resolution as an ordinary resolution: “RESOlvED THAT M/s. Deloitte Haskins & Sells, chartered accountants, Mumbai registered with the institute of chartered accountants of india vide Membership no. 117366w be and are hereby appointed as auditors of the company, to hold office from the conclusion of this Meeting until the conclusion of the next annual general Meeting on such remuneration as shall be fixed by the Board of Directors of the company”
(2) (3)
(4)
(5)
(6)
(7)
SPEcIAl BUSINESS:
(8) to consider and, if thought fit to pass with or without modification(s), the following resolution as an ordinary resolution: “RESOlvED THAT in supersession of the resolution passed at the annual general Meeting of the Members of the company held on august 5, 2011, and pursuant to the provisions of Section 293(1)
163
transportation
annual report 2011-12
charges/ hypothecation created/ to be created by the company, on such terms and conditions as the Board may deem fit on the whole or substantially the whole of the company’s undertakings and other properties, both present and/or future, whether movable or immovable comprised in any of the undertakings of the company as the case may be, in favour of banks and/or financial institutions, both national and international, and/or other bodies corporate or agencies as may be agreed to by the Board for the purpose of securing any issue of any debentures or loans or other financial assistance, by way of cash credit, overdraft, letter of credit and guarantee facilities and the like, whether in rupees or in foreign currency or currencies subject to a maximum limit of ` 5,000 crores (rupees Five thousand crores only) together with simple and/or compound interest thereon, commitment charges, management fees, service charges, premium on
redemption of debentures including any increase as a result of devaluation/evaluation/fluctuation in the rate of exchange of foreign currencies and all other costs, charges and expenses payable from time to time as per terms and conditions prescribed in any loan agreements or other deeds and documents entered into between the company and the said banks and / or financial institutions, both national and international, or bodies corporate and agencies” “RESOlvED fURTHER THAT the Board of Directors of the company including any committee thereof be and are hereby authorized to finalize and execute all agreements, deed, documents and other writings, as required, for creating mortgages, charges, and/or hypothecations and to do all such acts, as the Board may, in its absolute discretion, consider necessary, expedient or desirable including power to subdelegate, in order to give effect to this resolution” By order of the Board For il&FS transportation networks limited Krishna ghag associate vice president & company Secretary
Bengaluru, May 4, 2012 registered office: the il&FS Financial centre, c-22, g-Block, Bandra – Kurla complex, Bandra (east), Mumbai 400051
NOTES:
1. A MEMBER ENTITlED TO ATTEND AND vOTE AT THE MEETINg IS ENTITlED TO APPOINT A PROXY TO ATTEND AND vOTE INSTEAD Of HIMSElf, AND A PROXY NEED NOT BE A MEMBER Of THE cOMPANY. PROXIES IN ORDER TO BE EffEcTIvE MUST BE REcEIvED AT THE REgISTERED OffIcE Of THE cOMPANY NOT lESS THAN fORTY EIgHT HOURS BEfORE THE MEETINg an explanatory statement pursuant to Section 173(2) of the companies act, 1956, which sets out details relating to the Special Business, is annexed hereto as required under the listing agreement, the particulars of Directors seeking appointment/reappointment as Director are given in the annexure, is annexed hereto
4.
Members / proxies should bring the enclosed attendance slip duly filled in, for attending the Meeting, along with the annual report the register of Beneficial owners, register of Members and Share transfer Books of the company will remain closed from wednesday, august 1, 2012 to thursday, august 9, 2012 (both days inclusive) the Final Dividend as recommended by the Board of Directors, if approved by the Shareholders at their 12th annual general Meeting, shall be paid to those Members whose names appear on the register of Members of the company on thursday, august 9, 2012. in respect of shares held in electronic form, the Dividend will be payable to the Beneficial owners of the shares as on the closing hours of business on tuesday, July 31, 2012 as per the details furnished by Depositories for this purpose
5.
6.
2.
3.
164
SaFe
SoliD
SuStainaBle
that’s itnl for you
02 | corporate overview
20 | Strategic review
32 | Statutory reportS
59 | FinancialS
7.
Members are requested to immediately intimate changes, if any, in their registered addresses along with pin code number to the company or the registrar & Share transfer agents. Members holding shares in dematerialised mode are requested to intimate the same to their respective Depository participants in order to avail of the facility of electronic clearing Service (ecS), Members holding shares in physical form are requested to provide bank account details to the company or the registrar & Share transfer agents. Members holding shares in dematerialised mode are requested to instruct their respective Depository participants regarding bank accounts in which they wish to receive the dividends. the company/registrars & Share transfer agents will not act on any direct request received from Members holding shares in dematerialised form for change/deletion of such bank details the company is obliged to print such Bank details on the Dividend warrants as furnished by nSDl and cDSl, “the Depositories” to the company and the company cannot entertain any request for deletion/change of Bank details already printed on the Dividend warrant(s) based on the information received from the concerned Depositories without confirmation from them. in this regard Members are advised to contact their Depository participant (Dp) and furnish them the particulars of any change desired
12. Members are requested to bring their copy of the annual report to the Meeting Explanatory Statement Pursuant to Section 173(2) of the companies Act, 1956 Item No. 8 & 9 the Shareholders of the company, at the annual general Meeting held on august 5, 2011 authorised the Board of Directors for borrowing by way of loans, credit etc. upto a limit of ` 3,500 crores. as a result of the significant increase in the number and size of the projects that the company has been awarded there has been increase in the requirement of funds for investments in projects and for working capital support. the budgeted cash Flow for 2012-13 indicate a need for additional borrowings to provide for new investments, for repayment of existing loans and working capital, to facilitate which it is necessary to increase the approved borrowing limits. it is proposed that the borrowing limits of the company be increased by ` 1,500 crores from the present limit of ` 3,500 crores to ` 5,000 crores as per the provisions of Section 293(1)(a) and (d) of the companies act, 1956, the Board of Directors shall not, except with the consent of the shareholders in a general meeting, borrow moneys or create any charge by way of mortgage / hypothecation on any of the company’s properties and where moneys to be borrowed together with the moneys already borrowed by the company (apart from temporary loans obtained from the company’s bankers in the ordinary course of business) will exceed the aggregate of the paid up capital of the company and its free reserves, that is to say, reserves not set apart for any specific purpose the Board of Directors of your company recommends the ordinary resolutions set out at item no. 8 & 9 of the accompanying notice for approval of the Members none of the Directors of the company is in any way, concerned with or interested in this resolution
8.
9.
10. pursuant to the provisions of Section 205a of the companies act, 1956, the amount of dividend which remains unpaid /unclaimed for a period of 7 years would be transferred to the “investor education and protection Fund (iepF)”, constituted by the central government and Member(s) would not be able to claim any amount of dividend so transferred to the fund 11. Members intending to require information or clarifications about the Financial accounts, to be explained at the Meeting are requested to inform the company atleast a week in advance to enable the company to compile the information and provide replies at the Meeting
By order of the Board For il&FS transportation networks limited Krishna ghag associate vice president & company Secretary
Bengaluru, May 4, 2012 registered office: the il&FS Financial centre, c-22, g-Block, Bandra – Kurla complex, Bandra (east), Mumbai 400051
165
transportation
annual report 2011-12
Details of Directors seeking re-appointment at the annual general Meeting Particulars
Date of Birth Date of Appointment Qualifications
Deepak Dasgupta
16/12/1942 30/06/2009 Master’s degree in Science
Deepak Satwalekar
14/11/1948 30/06/2009 (i) Bachelor’s degree in technology from iiM, Mumbai Master’s degree in Business administration from the american university, washington Dc
vibhav Kapoor
16/07/1955 30/06/2009 Master of Business administration
Pradeep Puri
28/09/1956 6/1/2001 Master’s degree in History
(ii)
Expertise in specific functional areas
Has worked in various central govt departments related to infrastructure development & policy formulation • IJM (India) infrastructure limited C&C construction limited Road infrastructure Development company of rajasthan limited IL&FS Rail limited Rapid MetroRail gurgaon limited
Has considerable experience in the fields of finance, infrastructure and corporate governance
Has considerable experience in the fields of corporate finance and management of investments / treasury • • • • IL&FS Financial Services ltd IL&FS Investment Managers ltd IL&FS Securities Services ltd IL&FS Portfolio Management Services ltd
wide experience in handling infrastructure projects
Directorships in other Public limited companies*
• •
Asian Paints Limited National Stock exchange of india limited Infosys Limited Piramal Healthcare limited The Tata Power company limited
• • • • • •
North Karnataka expressway ltd Andhra Pradesh expressway limited West Gujarat Expressway ltd PDCOR Ltd Urban Mass Transit Co Ltd IL&FS Infrastructure Development corporation ltd IL&FS Urban Infrastructure Managers ltd Pipavav Railway corporation ltd ITNL Toll Management Services ltd North Karnataka expressway ltd - audit committee Andhra Pradesh expressway limited - audit committee West Gujarat Expressway ltd - audit committee Pipavav Railway corporation ltd - audit committee
•
• • •
•
• •
• • •
Membership of committees in other Public limited companies (includes only Audit & Shareholders’ / Investors’ grievance committee
•
C&C construction limited - investor grievance committee
•
Infosys Limited - audit committee - investor grievance committee
•
•
•
Road infrastructure Development company of rajasthan limited - audit committee
•
The Tata Power company limited - audit committe Piramal Healthcare limited - investor grievance committee
•
•
•
No. of Shares held in the company
79
-
3,14,800
31,652
*
excludes Directorships in private limited companies, Foreign companies and government bodies
166
SaFe
SoliD
SuStainaBle
that’s itnl for you
transportation
regd.office: the il&FS Financial centre,
c-22, g-Block, Bandra – Kurla complex, Bandra (east), Mumbai 400051
ATTENDANcE SlIP pleaSe Fill attenDance Slip anD HanD it over at tHe entrance oF tHe Meeting Hall
Dp .id* client id*
Folio no.
name and address of the Shareholder ..………………………………………………………................................................................ ......................................................................................................................................................................number of Shares held : ……………………………............. i hereby record my presence at the annual general Meeting of the company to be held on thursday, august 9, 2012 at 3.30
p.m., at y. B. chavan auditorium, gen. J. Bhosale Marg, Mumbai 400 021
*
applicable for investors holding Shares in electronic form Signature oF tHe SHareHolDer or proXy**
** Strike out whichever is not applicable
transportation
regd.office: the il&FS Financial centre,
c-22, g-Block, Bandra – Kurla complex, Bandra (east), Mumbai 400051
PROXY fORM
Dp .id* client id*
Folio no.
i/we …………………………………………………………………………………………………………..................................................... .............................................. being a Member/Members of il&FS transportation networks limited hereby appoint ………………………………………............. ................. ………………………………………………………….…………………………………………… of……............................................. or (failing him) ………………………………………………………………………………… of…………......................................... or (failing him) …………………………………………………………………………………… of………................................................... ......................................... as my/our proxy to attend and vote for me/us and on my/our behalf at the annual general Meeting of the company to be held on thursday, august 9, 2012 at 3.30 p.m. at y. B. chavan auditorium, gen. J. Bhosale Marg, Mumbai 400 021 and at any adjournment thereof Signed this ………………….day of …………………2012
Signature ……………..............................................
*applicable for investors holding shares in electronic form.
affix revenue stamp
………….........................
note : the proxy Form must be deposited at the registered office of the company at the il&FS Financial centre, c-22, g-Block, Bandra – Kurla complex, Bandra (east), Mumbai 400051 not less than 48 hours before the time for holding the meeting. the proxy need not be a member of the company
The IL&FS Financial Centre, Mumbai
IL&FS Transportation Networks Limited
The IL&FS Financial Centre Plot C22, G Block, Bandra Kurla Complex Bandra East, Mumbai 400 051 Tel.: 91-22-2653 3333 Fax: 91-22-2652-3979 www.itnlindia.com
doc_728461424.pdf