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NOTES TO ACCOUNTS

ITD Cementation India Ltd.

You can view the entire text of Notes to accounts of the company for the latest year
Market Cap. (₹) 1224.85 Cr. P/BV 1.20 Book Value (₹) 59.43
52 Week High/Low (₹) 144/65 FV/ML 1/1 P/E(X) 14.96
Bookclosure 09/08/2019 EPS (₹) 4.77 Div Yield (%) 0.56
Year End :2016-12 

1. Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of H1 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian Rupees. The dividend proposed if any by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except interim dividend.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts, if any. The distribution will be in proportion to the number of equity shares held by the shareholders.

2. Aggregate number of bonus shares issued, shares issued for consideration other than cash and shares bought back during the period of five years immediately preceding the reporting date.

The Company has not issued any bonus shares, shares for consideration other than cash and bought back any shares during five years immediately preceding the reporting date.

3. Out of the total issued capital, 25,260 (Previous year : 25,260) equity shares of H1 each have been kept in abeyance pending final settlement of rights issues.

Rupee term loan from bank (secured)

Term loan obtained from Doha Bank carries an interest rate of 10.15 percent per annum and repayable in 3 installments starting from November 2017. This loan is secured by hypothecation of Kolkata area depot land.

Term loan obtained from Vijaya Bank carried an interest rate of 12.25 percent per annum and has been fully repaid during the year. This loan was secured by hypothecation of Kolkata area depot land.

Rupee term loans from other parties (secured)

Term loan obtained from Indiabulls Housing Finance Limited carried an interest rate of 13.50 percent per annum and has been fully repaid during the year. This loan was secured by hypothecation of Kolkata office premises

Term loan obtained from Tata Capital Financial Services Limited carried an interest rate of 13 percent per annum and has been fully repaid during the year. This loan was secured by hypothecation of the office purchased out of this loan.

Plant loans from bank (secured)

Loan obtained from Axis bank for purchase of commercial vehicle /construction equipment carries interest rate ranging between 10.75 to 11.03 percent per annum and are repayable in 36 monthly installments. These loans are secured by first and exclusive charge on specific vehicle/equipment financed by the bank.

Loan obtained from Kotak Mahindra Bank Ltd. for purchase of commercial vehicle /construction equipment carries an interest rate of 9.65 percent per annum and are repayable in 46 to 58 monthly installments. These loans are secured by first and exclusive charge on specific vehicle/equipment financed by the bank.

Plant loans from other party (secured)

Loans obtained from Tata Capital Limited for purchase of construction equipment carry interest rate ranging between 11.00 to 12.50 percent per annum and are repayable in 29 to 60 monthly installments. These loans are secured by first and exclusive charge on specific equipment financed by the institution.

Vehicle loans from bank (secured)

Loan obtained from Axis Bank for purchase of vehicles carry interest rate ranging between 9.51 to 10.50 percent per annum and are repayable in 60 monthly installments. These loans are secured by hypothecation of the vehicles purchased out of these loans.

Cash credit facilities (secured)

Cash credit facilities are availed from consortium bankers carries various interest rates ranging from 11.00 to 15.15 percent per annum and are secured by first pari passu charge on the current assets and movable plant and machinery other than those hypothecated against plant loans. These facilities are payable on demand.

4. Short-term borrowings (contd.)

Working capital demand loan (secured)

Working capital demand loan carry interest rate ranging from 9.70 to 12.00 percent per annum and are secured by first pari passu charge on the current assets and movable plant and machinery other than those hypothecated against plant loans. These facilities are payable on demand.

Commercial Paper (unsecured)

Commercial Paper is issued to HDFC Trustee Company Limited and Escorts Mutual Fund carries interest rate ranging between 10.00 to 10.50 percent.

5. Provident fund

The Company's expense for the provident fund aggregates H966.47 lakhs during the year ended31 December 2016 (31 December 2015 - Rs.774.51 lakhs).

Provident fund of employees is managed by the Company through trust "ITD Cementation India Limited Workmen Provident Fund" In line with the Provident Fund and Miscellaneous Provision Act, 1952. The plan guarantees interest at the rate notified by the Provident Fund Authorities. The contribution by the employer and employee together with the interest accumulated thereon are payable to employees at the time of separation from the Company or retirement, whichever is earlier. The benefits vests immediately on rendering of the services by the employee.

In terms of the guidance note issued by the Accounting Standards Board (ASB) of the Institute of Chartered Accountants of India for measurement of provident fund liabilities, the valuer has certified that there is no shortfall as at 31 December 2016 and 31 December 2015.

6. Superannuation

The Company's expense for the superannuation, a defined contribution plan aggregates Rs.565.11 lakhs during the year ended 31 December 2016 (31 December 2015 – Rs.388.19 lakhs) .

7. Leave entitlement

The liability for leave entitlement and compensated absences as at 31 December 2016 is Rs.1,033.49 lakhs (31 December 2015 : Rs.792.54 lakhs).

8.. Related Party Disclosures :

9. Names of related parties and description of relationship A Enterprise where control exists

10. Holding Company

Italian-Thai Development Public Company Limited

11. Subsidiary Company

ITD Cementation Projects India Limited B Other related parties with whom the Company had transactions i) Joint Ventures (unincorporated)

ITD Cemindia JV ITD - ITD Cem JV

ITD - ITDCem JV (Consortium of ITD - ITD Cementation)

ITD - Cem Maytas Consortium CEC - ITD Cem-TPL JV

ii) Key management personnel (KMP)

Mr. Adun Saraban - Managing Director Mr. S. Ramnath - Chief Financial Officer

Mr. Rahul Neogi - Company Secretary (appointed w.e.f. 1st February 2017) Mr. R C. Daga - Company Secretary (retired on 31st January 2017)

12. Fellow subsidiary

First Dhaka Elevated Expressway (FDEE) Company Limited

13. (a) Long-term trade receivables at 31 December 2016 include variation claims of Rs.309 lakhs (31 December 2015 – Rs.309 lakhs) for which the Company had received an arbitration award in its favour which has subsequently been upheld by the District Court. The customer has challenged this Court Order. However, based on the above arbitration award, Court Order and legal opinion, management is reasonably confident of recovery of these amounts.

14. Long-term trade receivables and unbilled work-in-progress at 31 December 2016 include Rs.1,139.96 lakhs (31 December 2015 - Rs.1,139.96 lakhs ) and Rs.2,755.80 lakhs (31 December 2015 - Rs.2,755.80 lakhs), in respect of a contract which has been rescinded by the Company and long-term trade receivables and unbilled work-in-progress as at 31 December 2016 includes Rs. 1,414.41 lakhs (31 December 2015 - Rs.1,414.41 lakhs) and Rs.5,921.77 lakhs (31 December 2015 - Rs.5,921.77 lakhs) respectively, in respect of another contract where the Company has received a notice from the customer withdrawing from the Company the balance works to be executed under the contract for which the Company has also issued guarantees aggregating Rs.1,497.13 lakhs (31 December 2015 - Rs.1,497.13 lakhs). The Company has made claims against the customer to recover these amounts and has initiated legal action. Based upon legal opinion received, management is reasonably confident of recovery of these amounts of long term trade receivable and unbilled work-in-progress and consequently no changes have been made to the values and classification of these amounts in the financial statements.

15. During the previous year ended 31 December 2015, the Company had signed a definitive agreement with the National Highways Authority of India (NHAI) under which both parties have agreed to settle all awards received, claims under consideration at various forums, pending disputes and amounts outstanding in the Company's and joint venture's books of account under trade receivables and unbilled work-in-progress in respect of all the contracts executed by the company and Joint Venture. Pursuant to this settlement the Company including its share in Joint Venture had accounted for the resultant loss on the settlement of Rs.12,397.19 lakhs which had been disclosed as an exceptional item.

16. Operating lease

17. The Company has taken various residential/commercial premises and construction equipment on cancellable operating lease. These lease agreements are normally renewed on expiry. Rental expenses in the statement of profit and loss for the year includes lease payments towards premises Rs.2,010.60 lakhs (31 December 2015 - Rs.1,974.18 lakhs).

18. General descriptions of non-cancellable lease terms :

- Lease rentals are charged on the basis of agreed terms.

- Assets are taken on lease over a period of 3-5 years.

- The Company did not sublease any of its assets and hence did not receive any sub lease payments during the current or previous year.

19. The tax year for the Company being the year ending 31 March, the provision for taxation for the year is the aggregate of the provision made for the three months ended 31 March 2016 and the provision based on the figures for the remaining nine months up to 31 December 2016, the ultimate tax liability of which will be determined on the basis of the figures for the period 1 April 2016 to 31 March 2017.

20. Previous year figures have been regrouped or reclassified, to conform to the current year's presentation wherever considered necessary.

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