Afcon Book.indd - Afcons Infrastructure Ltd.

AFCONS INFRASTRUCTURE LIMITEDIn September 2009, Company received mandate from Konkan Railway’s Corporation Ltd. to resume work on some locations of the prestigiousproject of constructing special bridge across river Chenab on the Katra–Laole Section of Jammu and Kashmir. The project was awarded tothe Company in 2004 and the works were subsequently suspended in 2008 by Indian Railway Board as the plans for the bridge could not befinalized in view of the treacherous geological conditions and alignment issues.During the year the growth of the Company has been well diversified across different segments and geographies on the desired line and focus.All the segments are well balanced and there is no over dependence on any one sector or geography and the remain present in all segmentswith a reasonable significant participation.3. CREDIT RATINGDuring the year, ICRA has upgraded the Long-Term Rating of the Company from “LAA-” to “LAA” which reflects High credit quality andShort-Term Rating is maintained at “A1+” which reflects Highest Credit Quality. Annual surveillance from CRISIL is under process.4. DIVIDENDThe Directors are pleased to recommend, for approval of members dividend of 0.01% on Convertable Preference Shares of the Company.The dividend, if declared, would involve an outflow of Rs.4.08 Lacs including Rs.0.58 Lacs towards dividend tax. In order to plough back theprofit for the growth, the Directors are not proposing dividend on equity shares.5. SHARE CAPITALDuring the year under review, the Company has allotted 296,134 equity shares to the employees who exercised ESOP option granted to themunder the ESOP Scheme 2006.6. SUBSIDIARIES(i) Change of name of step down subsidiary of the Company in Fujairah :During the year under review, the name of the step down subsidiary of the Company incorporated in Fujairah Free Zone, Fujairah, UAEwas changed from the name of “Afcons Emirates Financial Services FZE” to “Afcons Gulf International Projects Services FZE”.(ii) Acquisition of Shares and Change of name of SSS Electricals (India) Private Limited :The Company has on 30 th March 2010 entered into Share Sale & Purchase Agreement with Starkstrom-und Signal-Baugesellschaft GmbH., Germany for acquisition of 32000 (40%) equity shares held by it in SSS Electricals (India) PrivateLimited for a total consideration of Rs.1,60,000/-. Subsequently the Company has paid the aforesaid consideration on 14 th April 2010,to Starkstrom-und Signal-Baugesellschaft GmbH., Germany. Pursuant to the said acquisition SSS Electricals (India) Private Limitedbecame a wholly owned subsidiary of the Company.The Company is currently in the process of changing the name of SSS Electrials (India) Private Limited to Afcons Corrosion ProtectionPrivate Limited.(iii) As required under Section 212 of the Companies Act, 1956, the audited Statement of Accounts, the Report of the Board of Directors andAuditors’ Report of the subsidiary companies are annexed.7. CORPORATE GOVERNANCEYour Company, being a value driven organization, believes in coherent and self-regulatory approach in the conduct of its business to achievethe highest levels of good corporate governance practices. Therefore the Company in the interest of the Stakeholders voluntarily complies withthe requirements of Corporate Governance. A Report on Corporate Governance is attached separately to this Annual Report.8. MANAGEMENT DISCUSSION AND ANALYSIS REPORTThe Management Discussion and Analysis Report for the year under review, is presented as a separate section which forms part of the AnnualReport.9. DIRECTORSMr.P.S.Mistry, Mr.J.J.Parakh, Mr.B.D.Narang and Mr.R.M.Premkumar, Directors of the Company retire by rotation at the ensuing AnnualGeneral Meeting of the Company and being eligible offer themselves for re-appointment.Brief profile of Mr.P.S.Mistry, Mr.J.J.Parakh, Mr.B.D.Narang and Mr.R.M.Premkumar is annexed to the Notice of the Meeting.10. DIRECTOR’S RESPONSIBILITY STATEMENTPursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 with respect to the Directors Responsibility Statement, it ishereby confirmed that:(i) in preparation of the annual accounts, the applicable accounting standards have been followed along with a proper explanation relating toany material departures from the same;(ii) the Directors have selected such accounting policies, applied them consistently, and made judgement and estimates that are reasonableand prudent so as to give a true and fair view of the state of affairs of the Company as at 31 st March 2010 and of the profit or loss of theCompany for the year ended on that date;(iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisionsof the Companies Act, 1956 for safeguarding the asset of the Company and for preventing and detecting fraud and other irregularities; and(iv) the Directors have prepared the annual accounts on a going concern basis.11. QUALITY, HEALTH SAFETY & ENVIRONMENTThe Company firmly believes that the pursuit of excellence is one of the most critical component for a competitive success. With Quality,Health and Safety Environment being an essential part of the Company’s policy, it strives to deliver services by maintaining the highest level ofQuality, Health and Safe working environment.The policy of the Company is to conduct its construction business through an established Quality Management System, which aims to achieveCustomer Satisfaction and in the process improving Company’s competencies and competitiveness.The Company is certified ISO 9001:2008 for Quality Management System, ISO:14001:2004 for Environment Management System andOHSAS:18001: 2007 for Occupation, Health & Safety Management Systems. All the three systems are well established, documented,implemented and maintained.The Company has a commendable record in terms of safety at our various projects sites and has received a number of awards as well asappreciation letters from our clients.3