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Rail Vikas Nigam Ltd.

You can view the entire text of Notes to accounts of the company for the latest year
Market Cap. (₹) 4680.87 Cr. P/BV 1.06 Book Value (₹) 21.08
52 Week High/Low (₹) 30/19 FV/ML 10/1 P/E(X) 6.64
Bookclosure 18/09/2019 EPS (₹) 3.38 Div Yield (%) 0.40
Year End :2018-03 

Note 1 Key sources of estimation uncertainty

The followings are the key assumptions concerning the future, and the key sources of estimation uncertainty at the end of the reporting period that may have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities with next financial year.

a) Fair valuation measurement and valuation process

Financial instruments are measured initially at fair value and subsequently at amortized cost on the basis of materiality, transaction value up to Rs, 12.00 lakhs are measured at fair value on initial recognition and subsequently at amortized cost on group basis by considering that the amount is recoverable or payable at a average period of 5 years and Income and amortization on such financial instruments has been considered on yearly basis. Transaction value of Rs, 12.00 lakhs or more are measured at fair value at initial recognition and subsequently at amortized cost on individual transaction basis. Impact of fair valuation of Staff loans and advances are immaterial therefore it has been continuing at the carrying value.

The fair values of financial assets and financial liabilities is measured the valuation techniques including the DCF model. The inputs to these method are taken from observable markets where possible, but where this is not feasible, a degree of judgment is required in establishing fair values. Judgments include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments. See Note 31 for further disclosures.

b) Taxes

Deferred tax assets are recognized for unused tax losses and unabsorbed depreciation to the extent that it is probable that taxable profit will be available against which losses can be utilized significant management judgment is required to determine the amount of deferred tax asset that can be recognized, based upon the likely timing and level of future taxable profit together with future tax planning strategies.

c) Borrowings and Lease Receivables from Railway against Completed Projects

Company has borrowed funds from Indian Railway Finance Corporation for the purpose of construction of railway projects. There is a moratorium period of 3 years for each year's loan. During the said moratorium period, no amount on account of interest and principal shall be payable. The interest shall be charged on yearly basis and repayment of loan along with interest shall be once in a year (for a period of 12 years) after the completion of moratorium period. Ministry of Railways would make available to RVNL the required funds thereafter, to enable them to do the debt servicing. The debt servicing will pass through RVNL books. Accordingly, funds are received by RVNL on each year from MoR and the same is transferred to IRFC immediately. Therefore, there is no impact on Profit & Loss of RVNL i.e.. on the debit side of Profit & Loss finance cost is charged and by the same amount interest income is recognized in Statement of Profit and Loss.

34.1 Works being executed for SPVs and others parties are treated as a Deposit Work. The corresponding current assets and liabilities in respect of such projects have been recognized on the basis of expenditure incurred plus supervision charges as agreed. The advance received is disclosed under Current Liabilities and the amount recoverable on account of project execution under Sundry Debtors.

Note 37 A. Contingent Liabilities

37.A.1 In respect of claims by the contractor on account of arbitration not acknowledged as debts by the Company is Rs, 3,81,835.09 Lakhs (as at 31.3.2017: Rs, 3,19,352.17 Lakhs during 2017-18 contractors claims worth Rs, 8998.14 Lakhs were settled). A claim if any will be form part of the project cost and reimbursable by respective Clients.

37.A.2 In respect of Income Tax Demand as reflected on the website of Income Tax Department is Rs, 15.28 (as at 31.3.2017: Rs, 70.61 Lakhs) and company has not accepted the claim and submitted its representation to department as follows:-

Note 37 B. Contingent Assets

In respect of counter claims by the Company on account of arbitration is Rs, 1,14,923.41 Lakhs (as at 31.3.2017: Rs, 484,15.06 Lakhs).

Company has received show cause notice from Director General Goods & Service Tax Intelligence, Delhi Zonal Unit showing a demand of Rs, 211.08 crore of non-payment of service tax for the period from July'12 to June'2017 under forward/reverse charge mechanism on services provided to Ministry of Railway and/or services received by Zonal Railways. In this regard, the company has appointed a counsel to represent the case before Adjudicating Authority. If the liability is decided against the company in future, the same will be borne by Ministry of Railway.

Note 38. Capital Commitment

Capital commitment towards share capital in SPV’s is as at 31.03.2018 Rs, 2,041.00 Lakhs (as at 31.3.2017: Rs,2,041.00 lakhs), towards implementation of ERP is Rs,3806.91 Lakhs as at 31.03.2018 (as at 31.03.2017: Rs, 4,352.15 Lakhs).

38.1 Other Commitment

Commitment towards Contractual Payments of Project expenditure is Rs, 10,99,836.03 lakhs (as at 31.3.2017: Rs, 10,66,640.75 lakhs).

Note 42. Related Party disclosures as required by Ind-AS 24 "Related party Disclosure

42.1 Key Management Personnel:

Name Designation

Sh. S.C. Agnihotri Managing Director

Sh. Ashok Krishna Ganju Director Finance (up to 31.10.2017)

Ms. Gita Mishra Director Personnel

Sh. Vijay Anand Director Projects

Sh. Arun Kumar Director Operation

Sh. Ashok Kumar Chaudhary Chief Financial Officer (From 01st Nov, 2017)

Ms.Kalpana Dubey Company Secretary

Sh.Vinayak Bhalchandra Karanjikar Independent Director

Sh.Kailash KumarAggarwal Independent Director

Sh.Shiv Kumar Gupta Independent Director

Sh.Rajen Habib Khwaja Independent Director

Ms Sabita Pradhan Independent Director

Sh.Sukhmal Chand Jain Independent Director

42.2 Enterprises in which Directors interest exist:

High Speed Rail Corporation of India Limited

42.3 Joint Ventures

Kutch Railway Company Limited Haridaspur Paradip Railway Company Limited Krishnapatnam Railway Company Limited Bharuch Dahej Railway Company Limited Angul Sukinda Railway Limited Dighi Roha Rail Limited

42.4 Subsidiary

High Speed Rail Corporation of India Limited

42.5 Superannuation Trust

RVNL Medical and Welfare Trust

Contingent liabilities: ^15.32 Lakh (Financial year 2016-17 f Nil)

Capital commitment: ^ 42.18 lakhs (as at 31-03-2017: ^ 42.18 lakhs)

Note 1.Lease Arrangements 44.1 Financial Lease

The value of assets given on lease is reflected against contra liability payable to IRFC towards loan on completed projects as appearing in note 5, which is liquidated progressively through loan repayment to IRFC being arranged by MoR.

Note 2. Approval of financial statement

The financial statements has been approved for issue by the Board of Directors on 13.08.2018.

Note 3. Operating Cycle

Earlier, the operating cycle of the Company was more than 12 months and extends up to 5 to 6 years based on the time required from initiation of the project to completion of the project. Now the operating cycle of the Company is 12 months after change in procedure order of MoR in respects of transfer of PWIP as per the note no 9(e).

Note 4. Securities released to State Electricity Board/Public Companies

Securities paid to Electricity Boards/ Public Companies towards provision of High Tension Power Lines for electricity connections are booked as project expenditure being part of the project cost.

Note 5. Previous year figures has been rearranged, regrouped and reclassified to make them confirmatory with current year figures.

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