k~c rpg house...4 group affiliation (if any) rpg group 1.2. details of the directors: name, age...
TRANSCRIPT
K~C
Annexure 1
KEC INTERNATIONAL LTD . RPG House 463, Dr. Annie Besant Road Worli, Mumbai 400030, India +91 22 66670200 www.kecrpg.com
Disclosures to be provided along with the application for listing
1. Issuer details:
1.1. Details of the issuer:
1 Name KEC International Limited
Address RPG House, 463, Dr. Annie Basant Road, Worl i, Mumbai, Maharashtra, 400030
CIN L45200M H 2005 PLC152061
PAN AACCK5599H
2 Line of business Construction I erection and ma intenance of power, telecommunication and transmission lines
3 Chief Executive Managing Director & CEO- Mr. Vimal Kejriwal (Managing Director I Chief Financial Officer- Mr. Rajeev Aggarwal President/ CEO/ CFO)
4 Group affiliation (if any) RPG Group
1.2. Details of the directors:
Name, Age Address
designation and DIN
Name: Mr. 62 Unit No 208, 2nd Harsh Fir, Bezzola Vardhan Complex, B Wing, Goenka Sian Trombay Designation: Road, Opp Suman Chairman Nagar, Chembur DIN: Mumbai 400071
00026726 Name: Mr. 58 41, Landmark, Vimal Kejriwal 175, Carter Road, Designation: Near Rizvi College, Managing Bandra West Director & Mumbai 400050
CEO DIN:
00026981 Name: Mr. 82 502, Solitaire
Ajit Tekchand Hiranandani
Vaswani Gardens, Powai, Designation: Mumbai 400076
NED & ID* DIN: 00057953 Name: Mr. 70 61, Piramal House, Dilip Pochkhanwala
Registered Office: RPG House , 463, Dr. Annie Besant Road Worti, Mumba i 400030, CIN: L45200MH2005PLC152061, India.
Director Since
January 12, 2006
January 1,2015
January 12,2006
January 12,2006
List of other directorships $
1) RPG Life Sciences Limited 2) CEAT Limited 3) Bajaj Electricals Lim ited 4) Zensar Technologies Limited 5) Spencer International Hotels Limited 6) R P G Enterprises Limited 7) Raychem-RPG Private Lim ited 8) Breach Ca ndy Hospital Trust 1) KEC Power India Private Limited 2) Spencer International Hotels Limited 3) Raychem-RPG Private Limited 4) Indian Electrical and Electronics
Manufacturers Association
1) Zensar Technologies Limited 2) Embio Limited
1) VIP Industries Limited 2) DGP Enterprises Private Limited 3) D G P Capital Management Limited
An fi>RPG Company
K~C
Gopikisan Pi ramal Designation: NED & ID*
DIN: 00032012
Name: Mr. G.L. Mirchandani Designation:
NED & ID* DIN: 00026664
Name: Mrs. Nirupama Rao
Designation: NED & ID* DIN: 06954879
Name: Mr.
Ramesh D. Chandak Designation: NED & ID*
DIN: 00026581
Name: Mr. Sudhir Mohan
Trehan Designation:
NED & ID*
DIN: 00060106
Name: Mr. Vikram
Gandhi Designation: Additional (Independent) Director
DIN: 05168309
76
69
73
73
57
Road, Worli,
Mumbai 400025
131 Tahnee January Height, D Block, 12,2006 13th Floor, Nepeansea Road,
Mumbai 400006
Apartment D, First October
Floor, Spring Leaf 31, 2014 Apartment 6
Brunton Cross Road, Bangalore
North, Museum Road Bengaluru 560025
Tower No-S, Flat Decembe
No-2901, Crescent r 26, Bay Jerbai Wadia 2005 Road, Parel Mumbai 400012
501, 502, Lotus October
Lalkamal Building, 30, 2012 9th North South
Road, JVPD, Vile Parle (West) Mumbai 400056
Honeycomb Unit August 7, 6A Joe Lewis Drive 2019 & Ernie's Way,
P.O. Box, SP Nassau 63158 BS
Registered Office: RPG House. 463, Dr. Annie Besant Road Worli, Mum ba i 400030, CIN: L45200MH2005PLC152061.1nd ia .
KEC INTERNATIONAL LTD. RPG House 463, Dr. Annie Besant Road Worli, Mumbai 400030, I ndia + 91 22 66670200 www.kecrpg.com
4) Alcon Finance and Investments Limited 5) Kiddy Plast Limited 6) Gazelle Travels Private Li mited 7) Alkly Amines Chemica ls Limited 8) DGP Securities Limited
9) Association for Development of Luggage and Accessories
10) Association for Development Of Handbags and Small Bags Industry
1) MIRC Electronics Limited 2) Olmo Capital Limited
3) Gulita Securities Limited 4) Fractal Analytics Private Limited 5) Adino Research Foundation 6) Algorhythm Tech Private Limited 7) Mumbai Angel Venture Mentors
1) lTC Limited
2) JSW Steel Limited
3) Adani Ports and Special Economic Zone limited
1) Parag Milk Foods Limited 2) Ram Ratna Wires Limited
3) Summit Securities Limited 4) Prince Pipes and Fittings Limited
5) Anand Rathi Wealth Services Limited 6) lndianivesh Fund Managers Pvt Ltd
NIL
1. Jana Small Finance Bank Limited 2. Grameen Capita l India Private Limited 3. L& T Infrastructure Development Projects
limited
4. VSG Capital Advisors Private Limited 5. Grameen Impact Investments India
Private limited
6. Asha Impact Advisory Services Private limited
7. SF! Impact Foundation
An ft/Ri'G Company
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Name: Mr. M. 59 L 201/202, Lyra s. Satellite Towers, Unnikrishnan Koregaon Park
Annexe, Near Designation: Army Sports Additional Institute, Pune (Independent) 411036 Director
DIN: 01460245
Novemb er 8, 2019
1. Thermax Limited 2. Thermax Babcock
KEC INTERNATIONAL LTD. RPG House 463, Dr. Annie Besant Road Worli, Mumbal 400030, India +91 22 66670200 www.kecrpg.com
& Wilcox Energy Solutions Private Limited
3. Thermax Onsite Energy Solutions Limited 4. Thermax Foundation
*NED & ID- Non- Executive Director & Independent Director $ Does not include directorship in Foreign Companies
1.3. Details of change in directors in last three financial years including any change in the current year:
Name, designation and Date of Date of cessation
appointment/ (in case of DIN
resignation resignation)
Name: Mr. S.S. Thakur January 12, 2006 November 6, 2017 Designation: NED & ID* DIN: 00001466
Name: Ms. Manisha February 6, 2018 June 11, 2019 Girotra Designation: NED & ID* DIN: 00774574
Name: Mr. S. M. January 12, 2006 July 27, 2019 Kulkarni Designation: NED & ID* DIN: 00003640
Name: Mr. Vikram August 7, 2019 Not Applicable Gandhi Designation: NED & ID* DIN: 05168309 Name: Mr. Vinayak April 30, 2014 August 12, 2019 Chatterjee Designation: NED & ID* DIN:00008933 Name: Mr. M.S. November 8, 2019 Not Applicable Unnikrishnan Designation: NED & ID* DIN: 01460245
*NED & ID- Non -Executive Director & Independent Director
Registered Office: RPG House, 463, Dr. Annie Besant Road Worli, Mumbai 400030, CIN: L45200MH2005PLC152061 , India.
Remarks (viz. reasons for change etc)
Resigned as an Independent Director on account of Personal Reasons
Appointed as an Additional (Independent) Director and subsequently resigned as an Independent Director on account of other professional commitments
Retired as an Independent Director due to end of term as Independent Director
Appointed as an Additional (Independent) Director
Resigned as an Independent Director on account of other professional commitments
Appointed as an Additional (Independent) Director
An • Ri'Ci Company
K~C KEC INTERNATIONAL LTD. RPG House 463, Dr . Annie Besant Road Worli, Mumbai 400030, India +91 22 66670200 www .kecrpg.com
1.4. List of top 10 holders of equity shares of the company as on December 31, 2019:
Total no. of No of Total
s. Name and category of shareholder Equity shares in
shareholding as No
Shares Dematform % of total no. of
equity shares
1 Swallow Associates LLP (Promoter Group) 67,756,616 67,756,616 26.36
2 Summit Securities Limited (Promoter Group) 27,910,754 27,910,754 10.86
3 HDFC Trustee Company Ltd (Mutual Funds) 23,779,697 23,779,697 9.25
4 Instant Holdings Limited (Promoter Group) 21,824,322 21,824,322 8.49
5 Reliance Capital Trustee Co Ltd (Mutual 8,691,558 8,691,558 3.38 Funds)
6 Aditya Birla Sun Life Trustee Private Limited 8,625,707 8,625,707 3.36 (Mutual Funds)
7 Kotak Standard Multicap Fund 7,991,885 7,991,885 3.11 (Mutual Funds)
8 Life Insurance Corporation of India 6,646,910 6,646,910 2.59
9 IDFC Sterling Value Fund (Mutual Funds) 6,100,593 6,100,593 2.37
10 Stel Holdings Limited (Promoter Group) 5,011,891 5,011,891 1.95 Note: The above shareholders are holding the shares in multiple folios which have been combined based on the Permanent Account Number (PAN) of the shareholder(s).
1.5. Details of the statutory auditor:
Name and address Date of appointment Remarks Price Waterhouse Chartered Accountants July 26, 2017 Appointed at t he 12th Annual LLP, Chartered Accountants General Meeting ('AGM') for Address: 252, Veer Savarkar Marg, Shivaji the period of 5 years t i ll the Park, Dadar (West), Mumbai - 400 028 conclusion of the 17th AGM of
the Company.
1.6. Details of the change in statutory auditors in last three financial years including any change in the current year:
Date of appointment/ Name and address
resignation
M/s Deloitte Haskins & Sells, June 15, 2006 Chartered Accountants
Address: lndiabulls Finance Centre, Tower 3, 27TH- 32N° Floor, Senapati Bapat Marg, Elphinstone Road (West), Mumbai- 400 013.
Registered Office: RPG House, 463, Dr. Annie Besant Road Worli, Mumbai 400030, C IN: L45200MH2005PLC152061 , India.
Date of cessation Remarks (viz. reasons
(in case of resignation)
for change etc)
- Their last t erm of appointment expired at t he 121
h AGM of t he Company held on July 26, 2017
An fhRi'G Company
K~C
1. 7. list of top 10 debt securities holders (as on December 31, 2019):
Total S. No. IS IN Name of Debenture Holders Amount
(Rs. Crore)
1. INE389H07037 HDFCTRUSTEE COMPANY LTD 15Q.OO
2. INE389H07045 HDFCTRUSTEE COMPANY LTD 50.00
3. INE389H07052 HDFCTRUSTEE COMPANY LTD 50.00
1.8. list of top 10 CP holders (as on December 31, 2019):
Category of Face Value Total CP
Sr. Name of CP Holder of Value
No. CP Holder CP Holding (Rs. In Crs.)
1 HDFC BANK LTD* Bank 5,00,000 50.00
2 SBI SAVINGS FUND Mutual Fund 5,00,000 250.00
3 SBI MAGNUM LOW Mutual Fund 5,00,000 50.00 DURATION FUND
4 lOBI LIQUID FUND Mutual Fund 5,00,000 100.00
Total CP outstanding as on December 31 2019 450.00
*Redeemed on January 24, 2020
2. Material Information:
KEC INTERNATIONAL LTD. RPG House 463, Dr. Annie Besant Road Worli, Mumbai 400030, India +91 22 66670200 www.kecrpg.com
Holding of debt securities as a percentage of total debt
securities outstanding of the issuer
60% 20% 20%
CP Holding percentage as a percentage of total CP
outstanding of the issuer
11.11% 55.56% 11.11%
22.22% 100.00%
2.1. Details of all default/sand/or delay in payments of interest and principal of CPs, (including technical delay), debt securities, term loans, external commercial borrowings and other financial indebtedness including corporate guarantee issued in the past 5 financial years including in the current financial year- No such default and/or delay by KEC International Limited
2.2. Ongoing and/or outstanding material litigation and regulatory strictures, if any. - NIL
2.3. Any material event/ development having implications on the financials/credit quality including any material regulatory proceedings against the Issuer/promoters, tax litigations resulting in material liabilities, corporate restructuring event which may affect the issue or the investor's decision to invest I continue to invest in the CP. - NIL
3. Details of borrowings of the company, as on the latest quarter end:
3.1. Details of debt securities and CPs: (As on December 31, 2019)
A. Details of Debt Securities (NCO's):
Registered Office: RPG House, 463, Dr. Annie Besant Road Worli, Mumbai 400030, CIN: L45200MH2005PLC152061, India.
An t>RPG Company
KtC Serie IS IN Tenor/ Coupo Amou
s period n nt of (%) issued
maturi (in ty Crs) (in
days)
INE389H070 1270 150 1
37 INE389H070
*Refer 2
45 1635 Note so
Below INE389H070
1879 so 3 52
Date of Redemptio Allotme n
nt date/ schedule
28-0ct-20-Apr-20
16 28-0ct-16
20-Apr-21
28-0ct-20-Dec-21
16
KEC INTERNATIONAL LTD. RPG House 463, Dr. Annie Besant Road Worli, Mumbai 400030, India +91 22 66670200 www .kecrpg.com
Credit Secur Securi rating ed/ ty
Unsee ured
ICRA Secur **Refe
"AA-" ed r Note Below.
*Coupon - Zero Coupon with yield on maturity of 9.33% p.a. tfu:mth!y compounded and payable at maturity (with a yield to maturity @9.74% p.a.) **Security· secured by way offirst charge on immovable and movable properties of the company situated at Vadodara and Mysore.
B CP Details
Series I SIN Tenor Coup Amo Date Redemp Cre Secure Secur Oth
I on unt of tion dit d/ ity er perio (%) issue Allotm date/ rati Unsecu deta d of d (in ent schedul ng red ils
matur Crs) e viz. ity Deta (in ils of
days) IPA, Deta ils
CRA KEC/CP/2
INE389Hl 7.70 31-Jul- 24-Jan- Unsecu 019-
4ET9 177
% so
19 20 Al+
red NA
20/11 KEC/CP/2
IPA INE389H1
90 7.30
150 13- 12-Mar-
Al+ Unsecu -
019-4EY9 % Dec-19 20 red
NA 20/15
Axis
KEC/CP/2 Bank
INE389H1 7.30 17· 16-Mar- Unsecu 019-
4EX1 90
% 100
Dec-19 20 Al+
red NA
20/16 CRA -
KEC/CP/2 INE389H1 7.30 24- 24-Mar- Unsecu CRISI
019-4EZ6
91 %
100 Dec-19 20
Al+ red
NA L&
20/17
KEC/CP/2 IR&R
INE389H1 7.30 31- 16-Mar- Unsecu 019-
4EX1 76
% so
Dec-19 20 Al+
red NA
20/18
3.2 Details of secured/ unsecured loan facilities/ bank fund-based facilities/ rest of the borrowing, if any, including hybrid debt like foreign currency convertible bonds (FCCB), optionally convert ible debentures I preference shares from banks or financial institutions or financial creditors, as on last quarter end:- As per annexure 1 attached
Registered Office: RPG House, 463, Dr. Annie Besant Road Worli, Mumbai 400030. CIN: l 45200MH2005PLC152061, India. An fi>Ri'G Company
K~C KEC INTERNATIONAL LTD. RPG House 463, Dr. Annie Besant Road Worli, Mumbai 400030, India +91 22 66670200 www.kecrpg .com
3.3. The amount of corporate guarantee or letter of comfort issued by the issuer along with name of the counterparty (like name of the subsidiary, JV entity, group company, etc) on beha lf of whom it has been issued, contingent liability including debt service reserve account (DSRA) guarantees/ any put option etc. (Details as on December 31, 2019)
Sr. Date of Issued in favour of Issued on behalf of Amount in
No. issuance of foreign Currency
Corporate guarantee
1 27.03.2017 ICICI Bank Limited AI Sharif Group and KEC Limited USD 34,100,000 Company
2 12.04.2017 Arab Bank Pic. AI Sharif Group and KEC Limited USD 25,000,000 Company
3 25.09.2017 Arab Banking AI Sharif Group and KEC Limited USD 35,000,000 Corporation Company
4 11.01.2018 Yes Bank Limited AI Sharif Group and KtC Urr!ited USD 30,000,000
Company
5 26.09.2018 Deustche Bank AG AI Sharif Group and KEC Limited USD 27,500,000 Company
6 17.10.2018 EXIMBank SAE Towers Mexico S de RL de USD 10,700,000 cv
7 12.07.2019 Deutsche Bank KEC International (Malaysia) MYR 45,000,000 (Malaysia) Berhad SON. BHD.
8 06.08.2019 Abu Dhabhi AI Sharif Group & KEC Ltd Co. AED 275,000,000 Commercial Bank
9 22.11.2019 Bank Muscat AI Sharif Group & KEC Ltd Co. SAR 36,797,520 S.A.O.G
4. Issue Information:
4.1. Details of current t ranche including IS IN, amount, date of issue, maturity, all credit ratings including unaccepted ratings, date of rating, name of credit rating agency, its validity period (details of credit rating letter issued not older than one month on the date of opening of the issue), details of issuing and paying agent and other conditions, if any.-
I SIN
Amount (Rs. In Crs.)
Date of Issue
Maturity Date
Credit Rating
Rating Date
Name of Credit Rating Agency
Rating Validity Period
Details of Issuing and Paying Agent
Other Conditions
Registered Office: RPG House, 463, Dr. Annie Besant Road Worti, Mumbai 400030, CIN: L45200MH2005PLC152061 , 1ndia .
INE389H14FB4
50.00
30Jan, 2020
30 Mar, 2020
A1+
21-Jan-20 15-Jan-20
India Ratings & Research Pvt. CRISIL Limited
Ltd., Fitch Group
18-Jul-20 60 days from date of
rating
Axis Bank Ltd., Axis House, Worli, Mumbai- 400 025
NIL
An fi>Ri'Q Company
K~C KEC INTERNATIONAL L TO. RPG House 463, Dr. Annie Besant Road Worli, Mumbai 400030, India + 91 22 66670200 www.kecrpg.com
4.2. CP borrowing limit, supporting board resolution for CP borrowing, detai ls of CP issued during the last 15 months. - CP Borrowing limit - Rs. 1,000 crore. Resolution & details of CP issued during the last 15 months are attached as Annexure 2.
4.3. End-use of funds. - Working Capital Requirement.
4.4. Credit Support/enhancement (if any) : None
5. Financial Information: 5.1. Audited I Limited review half yearly consolidated (wherever available) and standalone financia l
information (Profit & Loss statement, Balance Sheet and Cash Flow statement) along with auditor qualifications, if any, for last three years along with latest available financial resu lts . In case an issuer is required to prepare financial results for the purpose of consolidated financial results in terms of Regulation 33 of SEBI LODR Regulations, latest available quarterly financial results shall be filed. The financial results and Annual Reports of the Company for the above period are hosted on the
Website of the Company:
https :/ fwww. kecrpg.com/fi na ncial-a nnual-resu Its
The Financials for last 3 years are enclosed as Annexure 3
The Unaudited financials with limited Review report for the quarter ended September 30, 2019 is
attached as Annexure 3
5.2. Latest audited financials should not be older than six months from the date of application for listing.
Provided that listed issuers (who have already listed their specified securities and/or 'Non-convertible Debt Securities' (NCDs) and/or 'Non-Convertible Redeemable Preference Shares' (NCRPS)) who are in compliance with SEBI (List ing obligations and disclosure requirements) Regulations 2015 (hereinafter "SEBI LODR Regulations" ), and/or issuers (who have outstanding listed Commercial Paper (CPs)) who are in compliance with Annexure II of CP Circular may file unaudited financials with limited review for the stub period in the current f inancial year, subject to making necessary disclosures in this regard including risk factors. The Unaudited financials with Limited Review report for the quarter ended September 30, 2019 is attached as Annexure 3
Asset Liability Management {AlM) Disclosures: 6.1. NBFCs seeking to list their CPs shall make disclosures as specified for NBFCs in SEBI Circula r nos.
CIR/IM D/DF/ 12/2014, dated June 17, 2014 and CIR/IMD/DF/ 6/2015, dated September 15, 2015, as revised from time to time. Further, "Total assets under management", under para l.a. of Annexure 1 of CIR/IMD/DF/ 6 /2015, dated September 15, 2015 shall also include details of off-balance sheet assets: Not applicable
Registered Office: RPG House, 463, Dr. Annie Besant Road Worli, Mumbai 400030, CIN: L45200MH2v05PLC152061, India.
An fli>RPG Company
K~C KEC INTERNATIONAL LTD. RPG House 463, Dr. Annie Besant Road Wor11, Mumbai 400030, India +91 22 66670200 www.kecrpg .com
6.2. HFCs shall make disclosures as specified for NBFCs in SEBI Circular no. CIR/ IMD/DF/ 6/2015, dated September 15, 2015, as revised from t ime to time with appropriate modif ications viz. retail housing loan, loan against property, wholesale loan- developer and others: Not applicable
For KEC International Limited
~---Amit l<umar Gupta Company Secretary
Date: January 28, 2020 Place: Mumbai
Registered Office: RPG House, 463, Dr. Annie Besant Road Wor1i, Mumbai 400030, CIN: L45200MH2005PLC152061, India. An tiJRi'G Company
Annexure 1- Details of borrowing availed by KEC International Ltd. As on 30th September 2019 (Rs. In Crs.)
(A) Consortium Borrowing: Working capital fund-based facility
Security Secured by way of first charge on whole of the current assets and flat situated at Juhu and second charge on
fixed assets situated at Jaipur, Jabal pur and Nagpur factories.
Rating Long term rating "AA-" issued by CARE Asset Classification: Standard
Lender's name/Name of the Bank Amount Principal amount Repayment
Sr. No. Sanctioned outstanding Date/Schedule
1 Allahabad Bank 155 0 2 Axis Bank Ltd 220 119 3 Bank of Baroda 400 387 4 Bank of India 320 197 5 Central bank of India 132 124 6 Corporation bank 80 0 7 Deutsche Bank so 235 8 Export-Import Bank of India 200 198 9 ICICI Bank Ltd 175 20 Loan
10 lOBI Bank Ltd 110 32 repayable on
11 IDFC First Bank 25 0 demand
12 Kotak Mahindra Bank 75 39 13 Punjab National bank 130 70 14 RBL Bank 0 0 15 Societe Generale 35 46 16 Standard Chartered Bank 15 2 17 State bank of India 360 140 18 Syndicate bank 100 35 19 Yes Bank Ltd 18 0
Total (A) 2600 1,645
(B) Unsecured Borrowing: Working capital fund-based facility
Rating NA Asset Classification: Standard
Lender's name/Name of the Bank Amount Principal amount Repayment
Sr. No. Sanctioned outstanding Date/Schedule
1 HDFC Bank Ltd 50 50 Loan repayable on
demand Total (B) 50 50
(C) Project Based Borrowing outside India:
Security Secured by assignment of project specific book debts
Rating NA Asset Classification: Standard
Lender's name/Name of the Bank Amount Principal amount Repayment
Sr. No. Sanctioned outstanding Date/Schedule
1 Project based borrowing outside India 26 26 Repayable on demand
Total (C) 26 26 Grand Total (A+B+C) 2,870 1,916
Kt C KEC INTERNATIONAL LIMITED
RPG Ho use
463, Dr. Annie Besant Road
Worli, M umbai 400030, India
+91 22 6667 0200
www.kecrpg.com
ANNEXURE 'JL Details of CPs issued during t he last 15 months (February 1 2018 to t ill current issue) '
Date of Dat e of I SIN Amount
Maturity Issue
INE389H14CS5 14-Feb-18 50.00 28-Mar-18
INE389H14CT3 16-Feb-18 50.00 26-Mar-18
INE389H14CS5 05-Mar-18 150.00 28-Mar-18
INE389H14CU1 03-Apr-18 250.00 29-Jun-18
INE389H14CU1 04-Apr-18 25.00 29-Jun-18
INE389H14CV9 04-Apr-18 100.00 04-Jun-18
INE389H14CW7 10-Apr-18 100.00 11-Jun-18
INE389H14CW7 13-Apr-18 50.00 11-Jun-18
INE389H14CX5 19-Apr-18 50.00 18-Jun-18
IN E389H14CY3 20-Apr-18 25.00 19-Jun-18
INE389H14CZO 09-May-18 75.00 09-Jul-18
INE389H14DA1 09-May-18 25.00 08-Aug-18
INE389H14DB9 15-May-18 50.00 13-Aug-18
INE389H14DC7 24-May-18 50.00 23-Jul-18
INE389H14DD5 04-Jun-18 100.00 03-Sep-18
INE389H14DE3 11-Jun-18 100.00 10-Aug-18
INE389H14DFO 11-Jun-18 50.00 05-Sep-18
INE389H14DG8 18-Jun-18 50.00 17-Sep-18
INE389H14DG8 19-Jun-18 25.00 17-Sep-18
INE389H14DH6 29-Jun-18 250.00 21-Sep-18
INE389H14D14 29-Jun-18 25.00 28-Aug-18
INE389H14DD5 05-Jul-18 150.00 03-Sep-18
INE389H14DJ2 06-Jul-18 50.00 07-Sep-18
INE389H14DJ2 09-Jul-18 75.00 07-Sep-18
INE389H14DKO 23-Jul-18 50.00 27-Sep-18
INE389H14DL8 08-Aug-18 25.00 08-0ct-18
INE389H14DM6 10-Aug-18 100.00 09-0ct-18
INE389H14DN4 13-Aug-18 50.00 12-0ct-18
INE389H14D02 28-Aug-18 25.00 29-0ct-18
INE389H14DP9 03-Sep-18 250.00 02-Nov-18
INE389H14DQ7 05-Sep-18 50.00 05-Nov-18
INE389H14DR5 07-Sep-18 125.00 06-Nov-18
INE389H14DS3 17-5ep-18 75.00 16-Nov-18
INE389H14DT1 21-Sep-18 250.00 20-Nov-18
INE389H14DU9 27-Sep-18 50.00 26-Nov-18
INE389H14DV7 01-Nov-18 100.00 28-Dec-18
INE389H14DV7 02-Nov-18 100.00 28-Dec-18
INE389H14DW5 02-Nov-18 200.00 26-Dec-18
IN E389H 14DX3 02-Nov-18 50.00 27-Dec-18
INE389H14DX3 05-Nov-18 50.00 27- Dec-18
INE389H14DX3 06-Nov-18 125.00 27- Dec-18
INE389H14DY1 16-Nov-18 75.00 31-Jan-19
INE389H14DZ8 20-Nov-18 250.00 18-Jan-19
INE389H14DY1 04-Dec-18 50.00 31-Jan-19
INE389H14EA9 26-Dec-18 200.00 25-Feb-19
INE389H14EA9 27-Dec-18 225.00 25-Feb-19
INE389H14EB7 28-Dec-18 200.00 26-Feb-19
INE389H14EC5 10-Jan-19 250.00 19-Mar-19
INE389H14ED3 31-Jan-19 125.00 26-Mar-19
Registered Office: RPG House, 463, Or. Annie Besant Road Worli, Mumbai 400030, CIN: l45200MH2005PLC152061, India.
Amount IPA Credit Rating Agency
Outstanding
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
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Ni l Axis Bank
Ni l Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank 1. India Ratings & Research
Nil Axis Bank Pvt. Ltd., Fitch Group;
Nil Axis Bank 2. CRISIL Ltd.
Nil Axis Bank
Nil Axis Bank
Ni l Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
Nil Axis Bank
. . . For KEC INTERNATIONAL LIMITED ~~o-~ ., (d~ ·- . =---(OJLJP SOMANI} GENERAL MANAGER- FINANCE
Rating
A1+
A1+
A1+
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Al+
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A1+
Al+
A1+
A1+
A1+
A1+
A1+
A1+
A1+
A1+
A1+
(INR in Crs)
Rated
Amount
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 800 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
I'IRI'G Company
"
K~c KEC INTERNATIONAL LIMITED
RPG House
463, Dr. Annie Besant Road
Worli, Mumbai 400030, India
+91 22 6667 0200
www. kecrpg.com
ANNEXURE1L
Details of CPs issued during the last 15 months (February 1, 2018 to t ill current issue)
ISIN Date of
Issue Amount
Date of
Maturity
INE389H14EE1 25-Feb-19 100.00 25-Mar-19
INE389H14ED3 26-Feb-19 100.00 26-Mar-19
INE389H14EF8 26-Feb-19 100.00 28-Mar-19
INE389H14EF8 27-Feb-19 100.00 28-Mar-19
INE389H14EG6 19-Mar-19 100.00 17-May-19
INE389H14EH4 26-Mar-19 100.00 27-May-19
INE389H14EH4 28-Mar-19 50.00 27-May-19
INE389H14EH4 02-Apr-19 50.00 27-May-19
INE389H14E12 03-Apr-19 100.00 10-Jun-19
INE389H14EJO 04-Apr-19 200.00 03-Jun-19
INE389H14EK8 17-May-19 100.00 16-Jul-19
INE389H14EL6 27-May-19 100.00 26-Jul-19
INE389H14EM4 30-May-19 50.00 30-Jul-19
INE389H14EM4 31-M ay-19 50.00 30-Jul-19
INE389H14EN2 03-Jun-19 150.00 22-Jul-19
INE389H14EOO 03-Jun-19 100.00 23-Jul-19
INE389H14EP7 1D-Jun-19 100.00 31-Jul-19
INE389H14EP7 13-Jun-19 50.00 31-Jul-19
INE389H14EM4 18-Jun-19 25.00 30-Jul-19
INE389H14EQ5 05-Jul-19 150.00 05-Aug-19
INE389H14ER3 17-Jul-19 100.00 13-Sep-19
INE389H14ES1 31-Jul-19 40.00 30-Aug-19
INE389H14ET9 31-Jul-19 50.00 24-Jan-20
INE389H14EU7 27-Aug-19 100.00 05-Dec-19
INE389H14EV5 27-Aug-19 100.00 02-Dec-19
INE389H14EW3 18-Sep-19 100.00 17-Dec-19
INE389H14EY9 13-Dec-19 150.00 12-M ar-20
INE389H14EX1 17-Dec-19 100.00 16-M ar-20
INE389H14EZ6 24-Dec-19 100.00 24-Mar-20
INE389H14EX1 31-Dec-19 50.00 16-Mar-20
IN E389H14FA6 14-Jan-20 20.00 27-Mar-20
INE389H14FB4 30-Jan-20 50.00 30-Mar-20
Amount of CP Outstanding (14 Jan, 2020)
Registered Office: RPG House, 463, Dr. Annie Besant Road
Worli, Mumbai 400030, CIN: l4S200MH2005PLC152061, India.
Amount IPA Credit Rating Agency
Out st anding Rating
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Ni l Axis Bank A1+
Ni l Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank Al+
Nil Axis Bank A1+
Nil Axis Bank 1. India Ratings & Research
A1+
Nil Axis Bank A1+
Nil Axis Bank Pvt. Ltd ., Fitch Group;
A1+ 2. CRISIL Ltd.
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
Nil Axis Bank A1+
150.00 Axis Bank A1+
100.00 Axis Bank A1+
100.00 Axis Bank A1+
50.00 Axis Bank A1+
20.00 Axis Bank A1+
50.00 Axis Bank A1+
470.00
. . KEC INTERNATIONAL LIMITED _For ~~
~SOMANI) GENERAL MANAGER·. FINANCE.
(INR in Crs)
Rated
Am ount
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
Rs. 1000 Crs.
.t>IRPa Company
K~C KEC INTERNATIONAL LTD. RPG House 463, Dr. Annie Besant Road Worll, Mumbal 400030, India +91 22 66670200 www. kecrpg .com
Certified True Copy of the Resolution passed by the Finance Committee of Directors of the Company in its meeting held on June 11, 2018
Borrowing by issuing Commercial Papers in Dematerialized Form:
"RESOLVED THAT in supersession to earlier resolution passed by the Finance Committee of Directors of the Company in its meeting dated April 19, 2017 (without prejudice to the actions already taken by virtue thereof), the Company do borrow by issuing Commercial Papers ("CPs") in dematerialized Fmm up to a sum of~ 1000 crore (Rupees One Thousand Crore only) in one or more tranches out ofthe working capital limits sanctioned by Company's bankers either on standalone rating basis with or without earmarking fund based limit or on enhanced rating backed by guarantee from Banks, as may be decided by Mr. Rajeev Aggarwal, Chief Financial Officer, Mr. Pankaj Kalani, Sr.Vice President- Finance and Commercial or Mr. Dilip Somani, General Manager- Finance from time to time on the following terms and conditions:
Subscription by
Total Amount
Interest Rate
IPA Fees
Stamp Duty
: Bank(s) I Institution(s) I Mutual Fund(s)
: Rs. 1 000 Crores
: Negotiable
: Negotiable
: As Applicable
RESOLVED FURTHER THAT Mr. Rajeev Aggarwal, Chief Financial Officer, Mr. Pankaj Kalani, Sr.Vice President- Finance and Commercial or Mr. Dilip Somani, General ManagerFinance, be and are severally authorised to take all or any of the necessary steps, to do all such acts, deeds, matters and things as they may deem necessary to implement the above resolution including to discuss, negotiate and fmalise the terms and conditions, appointing Issuing and Paying Agent ("IP A") for this purpose and also to execute such agreements I deeds I documents within the purview of the above mentioned terms and conditions and to do all such acts, deeds and things as may be required in this regard.
RESOLVED FURTHER that the copies of the foregoing resolution, certified to be true by any one of the Directors or Mr. Rajeev Aggarwal, ChiefFinancial Officer or Mr. Amit Kumar Gupta, Head- Secretarial & Compliance Officer of KEC, be furnished to whomsoever it may concern."
- Certified True Copy -For KEC International Limited
~ Amit Kumar Gupta Company Secretary December 17, 2019
Registered Office: RPG House. 463, Dr. Annie Besant Road Wor11, Mumbal 400030, CIN· L45200MH2005PLC152061, India.
An lJJ>Ri'G Company
K~C KEC INTERNATIONAL LTD. RPG House 463, Dr. Annie Besant Road Worli, Mumbai 400030, India +91 22 66670200 www.kecrpg.com
Certified True Copy of the Resolution passed by the Finance Committee of the Directors of the Company at its meeting held on December 2, 2019
Borrowing by issuing Commercial Papers in Dematerialized form:
"RESOLVED THAT in partial modification to the earlier resolution passed by the Finance Committee of Directors of the Company in its meeting held on June 11, 2018, the Commercial Papers ("CPs") so issued, if required, be listed on BSE Limited and/or National Stock Exchange of India Limited, Mr. Rajeev Aggarwal, Chief Financial Officer, Mr. Pankaj Kalani, Sr. Vice President- Finance and Commercial, Mr. Dilip Somani, General Manager- Finance or Mr. Amit Kumar Gupta, Company Secretary, be and are hereby authorized, severally, to sign/execute necessary documents including Listing Agreement, application for listing along with all annexures, declarations, undertaking and such other documents as may be required and to do all such acts, deeds and things as may be required in this regard.
RESOLVED FURTHER that the copies of the foregoing resolution, certified to be true by any one of the Directors or Mr. Rajeev Aggarwal, Chief Financial Officer or Mr. Amit Kumar Gupta, Company Secretary of the Company, be furnished to whomsoever it may concern."
-Certified True Copy-For KEC International Limited
~ Amit Kumar Gupta Company Secretary
December 17, 2019 Mumbai
Registered Office: RPG House, 463 , Dr. Annie Besant Road Worli, Mumbai 400030 , CIN: L45200MH2005PLC152061 , India.
An tH5Ifi Company
191Management Review Statutory ReportsCorporate Overview Financial Reports
Independent Auditor’s ReportTO THE MEMBERS OF KEC INTERNATIONAL LIMITED
Report on the Standalone Ind AS Financial StatementsWe have audited the accompanying standalone Ind AS
KEC INTERNATIONAL LIMITED (“the Company”), which comprise the Balance Sheet as at March 31, 2017,
Comprehensive Income), the Cash Flow Statement and the , and
, in which are incorporated the Returns
, , Algeria, Bangladesh, Congo, , , Georgia, Ghana, Indonesia, Ivory Coast, Kazakhstan, Kenya, , ,
, Malaysia, Nepal, Nigeria, , , South , , Tanzania, Thailand, Tunisia, Uganda, and
Management’s Responsibility for the Standalone Ind AS Financial Statements
, 2013
,
comprehensive income,
the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting
and design,
,
records,
, whether due to
Auditor’s Responsibility
In conducting our audit, we have taken into account the , the accounting and auditing standards and
statements in accordance with the Standards on Auditing
, including the
, whether due to , the auditor
, as well as evaluating the overall
,
192 KEC International Limited Annual Report 2016-17
Opinion
to the explanations given to us,
,
with the accounting principles generally accepted in India,
, 2017, and , total comprehensive income,
Other Matters
` 106,
at March 31, ` 121,
, as considered in
,
,
, is
March 31,
sheet as at April 01,
statements prepared in accordance with the Ind AS have
Report on Other Legal and Regulatory Requirements,
,
,
,
c)
d) The Balance Sheet,including other Comprehensive Income, the Cash
e) In our opinion,
, 2017 taken ,
,
193Management Review Statutory ReportsCorporate Overview Financial Reports
controls,
the Companies (Audit and Auditors) Rules, 2014, management we report that the disclosures
For DELOITTE HASKINS & SELLSChartered Accountants
SAIRA NAINAR
194 KEC International Limited Annual Report 2016-17
Annexure “A” To The Independent Auditor’s Report
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)
KEC INTERNATIONAL LIMITED (“the Company”)
Management’s Responsibility for Internal Financial Controls
Auditor’s Responsibility
(Referred to in paragraph 1(g) under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even INTERNATIONAL LIMITED)
the risk that a material weakness exists, and testing and
Meaning of Internal Financial Controls Over Financial Reporting
includes those policies and procedures that (1) pertain to the
transactions are recorded as necessary to permit preparation
accounting principles, and that receipts and expenditures
Inherent Limitations of Internal Financial Controls Over Financial Reporting
195Management Review Statutory ReportsCorporate Overview Financial Reports
Opinion
Other Matters
For DELOITTE HASKINS & SELLSChartered Accountants
SAIRA NAINAR
196 KEC International Limited Annual Report 2016-17
Annexure “B” To The Independent Auditor’s Report(Referred to in paragraph 2 under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even
(i) (a) The Company has maintained proper records
situated at Gandhinagar, Gujarat, admeasuring
Gross carrying amount aggregating `lakh and Net carrying amount aggregating `
intervals and no material discrepancies were noticed on
(iii) The Company has not granted any loans, secured
explanations given to us, the Company has complied with
us, the Company has not accepted any deposit during the
the Company pursuant to the Companies (Cost Records
depositing undisputed statutory dues, including
and other material statutory dues in arrears as at
Management Review Statutory ReportsCorporate Overview Financial Reports
Statute Nature of Dues Forum where Dispute is Pending
Period to which the amount relates
Amount involved
(` in Lakh)
InterestCommissioner (Appeal)
Interest Rajasthan Tax Board, Ajmer
Commissioner (Appeal)
Interest on
exciseHigh Court
Supreme Court
Interest Commissioner (Appeal)
Interest
(Appeal)
InterestIncome Tax High Court
provided managerial remuneration in accordance with
(xii) The Company is not a Nidhi Company and hence reporting
explanations given to us, the Company is in compliance
explanations given to us, during the year the Company
its directors or persons connected with him and hence
For DELOITTE HASKINS & SELLSChartered Accountants
SAIRA NAINAR
198 KEC International Limited Annual Report 2016-17
Balance Sheet as on March 31, 2017
`
Particulars Note No. As at As at March 31, 2016
As at April 1, 2015
ASSETS(1) Non-Current Assets
(a) 6
(c) 7 80,024.38
(d) Financial Assets(i) Investments(ii)(iii) 10
14,483.16(e) 11
12Total Non-Current Assets 116,896.35 134,663.25
(2) Current Assets(a) Inventories 13
Financial assets(i) 14(ii) 15(iii) 16(iv) 17(v)
438,554.04 405,354.40(c) Current Tax Assets (Net)(d) 20
Total Current Assets 652,065.44 594,691.68Total Assets
EQUITY AND LIABILITIESEquity(a) 21
22Total equity 138,225.85 124,830.94
LIABILITIES(1) Non-Current Liabilities
(a)(i) Borrowings 23(ii) 24
26,089.21 21,102.0125
(c) 26Total Non-Current Liabilities 42,221.19 33,104.60
(2) Current Liabilities(a)
(i) Borrowings 27(ii) Acceptances(iii)(iv) 30
421,609.4431
(c) 32(d) 33
Total Current LiabilitiesTotal Equity And Liabilities
For Deloitte Haskins & SellsChartered Accountants
RAJEEV AGGARWAL H. V. GOENKA Chairman
SAIRA NAINAR CH. V. JAGANNADHA RAO VIMAL KEJRIWALCompany Secretary
A. T. VASWANI
199Management Review Statutory ReportsCorporate Overview Financial Reports
For Deloitte Haskins & SellsChartered Accountants
RAJEEV AGGARWAL H. V. GOENKA Chairman
SAIRA NAINAR CH .V. JAGANNADHA RAO VIMAL KEJRIWALCompany Secretary
A. T. VASWANI
`
Particulars Note No.For the year
ended For the year
ended March 31, 2016
I Revenue from operations 34II Other income 35III Total Income (I+II)IV Expenses
(i) 36(ii) 37(iii)(iv)(v)(vi) Finance costs 40(vii) 41(viii) 42Total expenses
VVI Tax expense : 43
(i) Current Tax(ii)
14,328.91VII 28,182.48VIII Other Comprehensive Income
A (i)50
(ii)B (i) 22
(ii)Total Other Comprehensive Income (834.48)
IX Total Comprehensive Income for the period (VII + VIII)
for the period)
19,268.46
X Earnings per equity share for continuing operation (of ` 2 each)(i) Basic
44(ii)
200 KEC International Limited Annual Report 2016-17
Statement of changes in equity
B. O
ther
Equ
ity
`
Part
icul
ars
Rese
rve
and
Surp
lus
Oth
er C
ompr
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Inco
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Tota
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Pr
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Deb
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Rede
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Rese
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Gen
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Re
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Rese
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Ea
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gspo
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H
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s
on t
rans
lati
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he
of fo
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Oth
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of o
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(Rem
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Bala
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1, 2
015
10,
899.
16 9
4.88
(116
.92)
- (6
6.51
)
Tota
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com
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ar -
- -
- -
- 2
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,268
.46
Bala
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as a
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arch
31,
201
6 9
42.6
3 9
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1,0
1,42
5.54
139
.50
(325
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1,3
3,08
4.08
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1, 2
016
942
.63
94.
88 1
,01,
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54 1
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0 (3
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08
Tota
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com
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ar -
- -
- -
- 2
8,18
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6.0
5
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88 1
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,60,
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A. E
quit
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Not
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21As
at M
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31,
201
621
As a
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1, 2
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For
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aski
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Sel
lsCh
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Acco
unta
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RAJE
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AL
H. V
. GO
ENKA
Cha
irm
an
SAIR
A N
AIN
AR
CH. V
. JA
GA
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IMA
L KE
JRIW
AL
Com
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Sec
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ry
A. T
. VA
SWA
NI
201Management Review Statutory ReportsCorporate Overview Financial Reports
`
Particulars For the year ended For the year ended March 31, 2016
A. CASH FLOW FROM OPERATING ACTIVITIES:PROFIT FOR THE YEAR 28,182.48Adjustments for:Income tax expense
Finance costsInterest income
advances (net)
68,461.40Changes in assets and liabilities 96,643.88 85,328.21Changes in working capital:Adjustments for (increase) / decrease in operating assets:Inventories
16,158.35Adjustments for increase / (decrease) in operating liabilities:
50,411.23 19,662.93CASH GENERATED FROM OPERATIONS 163,213.46
(12,163.14)NET CASH FLOW FROM GENERATED BY / (USED IN) OPERATING ACTIVITIES (A) 154,493.69
Cash Flow Statement
202 KEC International Limited Annual Report 2016-17
`
Particulars For the year ended For the year ended March 31, 2016
B. CASH FLOW FROM INVESTING ACTIVITIES
application money)
Interest received
(15,265.48) (10,315.99)NET CASH FLOW USED IN INVESTING ACTIVITIES (B) (15,265.48) (10,315.99)
C. CASH FLOW FROM FINANCING ACTIVITIES
Finance costs paid
3,565.96NET CASH FLOW (USED IN) / GENERATED BY FI-NANCING ACTIVITIES (C)
3,565.96
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS (A+B+C)
6,483.91 (10,480.50)
16,299.04
(0.18) 0.21
Cash and cash equivalents at the end of the year (Refer Note 15) 12,302.48
Cash Flow Statement
For Deloitte Haskins & SellsChartered Accountants
RAJEEV AGGARWAL H. V. GOENKA Chairman
SAIRA NAINAR CH. V. JAGANNADHA RAO VIMAL KEJRIWALCompany Secretary
A. T. VASWANI
112 KEC International Limited Annual Report 2016-17
Report on the Consolidated Ind AS Financial Statements We have audited the accompanying consolidated Ind AS
KEC INTERNATIONAL LIMITED
Management’s Responsibility for the Consolidated Ind AS Financial Statements
Auditor’s Responsibility
Opinion
Consolidated Financial Statements Independent Auditor’s Report TO THE MEMBERS OF KEC INTERNATIONAL LIMITED
113Management Review Financial ReportsStatutory ReportsCorporate Overview
Other Matters
`
`
`
`
amounting to ̀
as it relates to the amounts and disclosures included in
Report on Other Legal and Regulatory Requirements
114 KEC International Limited Annual Report 2016-17
companies and an associate company incorporated in
companies and associate company incorporated
DELOITTE HASKINS & SELLS
SAIRA NAINAR
Annexure “A” To The Auditor’s Report (Referred to in paragraph 1(g) under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section
Management’s Responsibility for Internal Financial Controls
Auditor’s Responsibility
115Management Review Financial ReportsStatutory ReportsCorporate Overview
Meaning of Internal Financial Controls Over Financial Reporting
transactions are recorded as necessary to permit preparation
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Opinion
Other Matter
DELOITTE HASKINS & SELLS
SAIRA NAINAR
116 KEC International Limited Annual Report 2016-17
Consolidated Balance Sheet
`
Particulars Note No. As at As at As at
ASSETS(1) Non-Current Assets
Investments
11
13Total Non-Current Assets
(2) Current AssetsInventories
Investments
Loans
Total Current AssetsTotal Assets
EQUITY AND LIABILITIESEquity
* *
LIABILITIES(1) Non-Current Liabilities
Total Non-Current Liabilities(2) Current Liabilities
Acceptances 31
33
Total Current LiabilitiesTotal Equity and Liabilities
`
Deloitte Haskins & Sells
RAJEEV AGGARWAL H. V. GOENKA
SAIRA NAINAR CH. V. JAGANNADHA RAO VIMAL KEJRIWAL
A. T. VASWANI
Management Review Financial ReportsStatutory ReportsCorporate Overview
`
Particulars Note No.For the year
ended For the year
ended
I Revenue from operationsII Other incomeIII Total Income (I+II)IV Expenses
Total expensesVVI Tax expenses :
VIIVIIIIXX Other Comprehensive Income
Total Other Comprehensive IncomeXI Total Comprehensive Income for the period (IX+X)
* *
* *
* * XII Earnings per equity share for continuing operations (of ` 2 each)
`
Deloitte Haskins & Sells
RAJEEV AGGARWAL H. V. GOENKA
SAIRA NAINAR CH. V. JAGANNADHA RAO VIMAL KEJRIWAL
A. T. VASWANI
KEC International Limited Annual Report 2016-17
Statement of changes in equity B.
Oth
er E
quit
y`
Part
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ars
Rese
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and
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)
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- -
- -
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145
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Management Review Financial ReportsStatutory ReportsCorporate Overview
Consolidated Cash Flow Statement
`
Particulars For the year ended For the year ended
A. CASH FLOW FROM OPERATING ACTIVITIES:PROFIT FOR THE YEARAdjustments for:
Interest income
Changes in assets and liabilitiesChanges in working capital:
Inventories
Loans
Adjustments for increase / (decrease) in operating liabilities:
CASH GENERATED FROM OPERATIONS
NET CASH FLOW GENERATED BY / (USED IN) OPERATING ACTIVITIES (A)
KEC International Limited Annual Report 2016-17
Consolidated Cash Flow Statement
`
Particulars For the year ended For the year ended
B. CASH FLOW FROM INVESTING ACTIVITIES
Interest received
NET CASH FLOW USED IN INVESTING ACTIVITIES (B)C. CASH FLOW FROM FINANCING ACTIVITIES
NET CASH FLOW USED IN FINANCING ACTIVITIES (C)NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS (A+B+C)
Deloitte Haskins & Sells
RAJEEV AGGARWAL H. V. GOENKA
SAIRA NAINAR CH. V. JAGANNADHA RAO VIMAL KEJRIWAL
A. T. VASWANI
INDEPENDENT AUDITORS’ REPORT
TO THE MEMBERS OF KEC International Limited
REPORT ON THE STANDALONE INDIAN ACCOUNTING STANDARDS (IND AS) FINANCIAL STATEMENTS
1. We have audited the accompanying standalone Ind AS financial statements of KEC International Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information, in which are incorporated 20 jointly controlled operations as referred to in Note 42 in the standalone financial statements and the Returns for the year ended on that date of the Company’s branches located at Abu Dhabi, Afghanistan, Algeria, Bangladesh, Egypt, Ethiopia, Georgia, Ghana, Indonesia, Ivory Coast, Jordan, Kenya, Laos, Lebanon, Libya, Malaysia(2), Mozambique, Nepal(2), Nigeria, Oman, Philippines, Senegal, South Africa, Sri Lanka, Tanzania, Thailand, Tunisia, Uganda, Zambia, Bhutan, Cameroon, Congo, Kazakhstan and Kuwait.
MANAGEMENT’S RESPONSIBILITY FOR THE STANDALONE IND AS FINANCIAL STATEMENTS
2. The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone Ind AS financial statements to give a true and fair view of the financial position, financial performance (including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
AUDITORS’ RESPONSIBILITY
3. Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.
4. We have taken into account the provisions of the Act and the Rules made thereunder including the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.
5. We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.
6. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the standalone Ind AS financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.
7. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
OPINION
8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2018, and its total comprehensive income (comprising of profit and other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
OTHER MATTER
9. We did not audit the Ind AS financial statements/financial information of 31 branches and 20 jointly controlled operations included in the standalone Ind AS financial statements of the Company, which constitute total assets of ` 264,326.05 lakh
184 KEC International Limited Annual Report 2017-18184
and net assets of ` 49,969.53 lakh as at March 31, 2018, total revenue of ` 219,863.71 lakh and net cash flows amounting to (` 1,355.44 lakh) for the year then ended. These financial statements/financial information have been audited by other auditors whose reports have been furnished to us, and our opinion on the standalone Ind AS financial statements to the extent they have been derived from such financial statements/financial information is based solely on the report of such other auditors.
10. The Ind AS financial statements of the Company for the year ended March 31, 2017, were audited by another firm of chartered accountants under the Companies Act, 2013 who, vide their report dated May 19, 2017, expressed an unmodified opinion on those financial statements.
Our opinion is not qualified in respect of these matters.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
11. As required by the Companies (Auditor’s Report) Order, 2016, issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (“the Order”), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order.
12. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) 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 and the reports of the other auditors for the branches not audited by us and proper returns adequate for the purposes of our audit have been received from the branches not visited by us.
(c) The reports on the accounts of the branch offices of the Company audited under Section 143 (8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.
(d) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account and with the returns received from the branches not visited by us.
(e) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.
(f) On the basis of the written representations received from the directors as on March 31, 2018 taken on record by the Board of Directors of the Company, none of the directors are disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164 (2) of the Act.
(g) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in Annexure A.
(h) With respect to the other matters to be included in the Auditors’ Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our knowledge and belief and according to the information and explanations given to us:
i. The Company has disclosed the impact, if any, of pending litigations as at March 31, 2018 on its financial position in its standalone Ind AS financial statements – Refer Note 49;
ii. The Company has made provision as at March 31, 2018, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts - Refer Note 29. Further, the Company did not have any material foreseeable losses on derivative contracts as at March 31, 2018.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2018.
iv. The reporting on disclosures relating to Specified Bank Notes is not applicable to the Company for the year ended March 31, 2018.
For Price Waterhouse Chartered Accountants LLP Firm Registration Number: 012754N/N500016
Chartered Accountants
Sarah George Place: Mumbai PartnerDate: May 14, 2018 Membership Number: 045255
185185Company Overview Financial StatementsStatutory Reports
ANNEXURE ‘A’ TO INDEPENDENT AUDITORS’ REPORTReferred to in paragraph 12(g) of the Independent Auditors’ Report of even date to the members of KEC International Limited on the standalone Ind AS financial statements for the year ended March 31, 2018
REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) OF SUB-SECTION 3 OF SECTION 143 OF THE ACT
1. We have audited the internal financial controls over financial reporting of KEC International Limited (“the Company”) as of March 31, 2018 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date, which includes the internal financial controls over financial reporting of the Company’s 36 branches.
MANAGEMENT’S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
2. The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
AUDITORS’ RESPONSIBILITY
3. Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing deemed to be prescribed under section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial
controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.
MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
6. A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
7. Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control
186 KEC International Limited Annual Report 2017-18186
over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
OPINION
8. In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
OTHER MATTER
9. Our aforesaid report under Section 143(3)(i) of the Act on the adequacy and operating effectiveness of the internal financial controls over financial reporting insofar as it relates to 31 branches, is based on the corresponding reports of the auditors of such branches. Our opinion is not qualified in respect of this matter.
For Price Waterhouse Chartered Accountants LLP Firm Registration Number: 012754N/N500016
Chartered Accountants
Sarah George Place: Mumbai PartnerDate: May 14, 2018 Membership Number: 045255
187187Company Overview Financial StatementsStatutory Reports
ANNEXURE ‘B’ TO INDEPENDENT AUDITORS’ REPORTReferred to in paragraph 11 of the Independent Auditors’ Report of even date to the members of KEC International Limited on the standalone Ind AS financial statements as of and for the year ended March 31, 2018
i. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.
(b) The fixed assets of the Company have been physically verified by the Management during the year and no material discrepancies have been noticed on such verification. In our opinion, the frequency of verification is reasonable.
(c) The title deeds of immovable properties, other than for self-constructed buildings, as disclosed in Note 5 on fixed assets to the financial statements, are held in the name of the Company, except in respect of Industrial plots situated at Gandhinagar, Gujarat, admeasuring to 4,891.45 sq. meters, Industrial plot situated at Mysore, Karnataka, admeasuring to 80,773 sq. meters, land and building situated at Jabalpur, Madhya Pradesh, admeasuring to 9,000 Sq. feet and a flat at Worli, Mumbai, admeasuring to 1,088.22 sq. feet, having Gross carrying amount aggregating ` 2,634.79 lakh and Net carrying amount aggregating ` 2,578.04 lakh as at Balance Sheet date, the titles of which have been transferred to and vested in the Company, pursuant to schemes of amalgamation/arrangement in the earlier years and the procedural formalities for transfer in the name of the Company in the relevant documents are in process.
ii. The physical verification of inventory excluding stocks with third parties have been conducted at reasonable intervals by the Management during the year. The discrepancies noticed on physical verification of inventory as compared to book records were not material and have been appropriately dealt with in the books of accounts.
iii. The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of Clause 3(iii), (iii)(a), (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.
iv. In our opinion, and according to the information and explanations given to us, the Company has complied with the provisions of Section 185 and 186 of the Companies Act, 2013 in respect of the loans and investments made, and guarantees and security provided by it.
v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.
vi. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of its products. We have broadly reviewed the same, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.
vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing the undisputed statutory dues, including provident fund, employees’ state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess, goods and service tax with effect from July 1, 2017 and other material statutory dues, as applicable, with the appropriate authorities.
(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of goods and service tax, which have not been deposited on account of any dispute. The particulars of dues of income tax, sales tax, service tax, duty of customs, duty of excise and value added tax as at March 31, 2018 which have not been deposited on account of a dispute, are as follows:
188 KEC International Limited Annual Report 2017-18188
Name of the statute Nature of duesAmount (` in Lakh)*
Period to which the amount relates
Forum where the dispute is pending
The Central Sales Tax Act, 1956 and Local Sales Tax Acts
Sales tax and value added tax
53.38 1999-2000 to 2015-2016 Appellate Tribunal46.66 1994-1995 to 1997-1998
and 2008-2009Rajasthan Tax Board, Ajmer
242.53 2003-2004 to 2011-2012 Commercial Tax Appellate Board, Madhya Pradesh
3,098.94 2006-2007 to 2013-2014 Revisionary Boards of Rajasthan and Madhya Pradesh
2,901.88 1995-1996 to 2015-2016 Appellate Authority – up to Commissioner’s levelThe Finance Act, 1994 Service Tax 29,561.44 2004-2005 to 2012-2013 Customs Excise and Service Tax Appellate
Tribunal (CESTAT)68.44 2008-2009 to 2012-2013 Commissioner Appeals
The Customs Act, 1962 Customs Duty 60.12 1995-1996 Commissioner of Customs (Appeals)The Central Excise Act, 1944 Excise Duty 1,419.09 1994-1995 to 2015-2016 Appellate Authority – up to Commissioner’s level
2,440.68 2004-2005 to 2014-2015 Customs Excise and Service Tax Appellate Tribunal (CESTAT)
61.76 2001-2002 to 2005-2006 Mumbai High Court13.44 2008-2009 to 2009-2010 Supreme Court of India
The Income- Tax Act, 1961 Income-Tax 192.80 Assessment Year 2007-2008 Income Tax Appellate Tribunal53.53 Assessment Year 2008-2009 High Court
The Rajasthan Tax on Entry of Goods into Local Areas Act, 1999
Entry Tax 93.46 1995-1996, 2004-2005, 2008-2009 to 2013-2014
Appellate Authority – up to Deputy Commissioner’s level
Entry Tax Act, 1976, Madhya Pradesh
Entry Tax 29.08 2001-2002 to 2002-2003, 2009-2010 to 2011-2012, 2015-2016
Appellate Authority – up to Deputy Commissioner’s level, Board of Appeals, Madhya Pradesh
* Net of amounts paid including under protest
For the above purpose, only statutory dues payable in India have been considered.
viii. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of loans or borrowings to any financial institution or bank or Government or dues to debenture holders as at the balance sheet date.
ix. The Company has not raised any moneys by way of initial public offer or further public offer (including debt instruments). Further, the term loans have been applied by the Company during the year for the purposes for which they were obtained.
x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.
xi. The Company has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and
188 of the Act. The details of such related party transactions have been disclosed in the financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act.
xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under audit. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.
xv. The Company has not entered into any non-cash transactions with its directors or persons connected with him. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.
xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.
For Price Waterhouse Chartered Accountants LLP Firm Registration Number: 012754N/N500016
Chartered Accountants
Sarah George Place: Mumbai PartnerDate: May 14, 2018 Membership Number: 045255
189189Company Overview Financial StatementsStatutory Reports
BALANCE SHEET as at March 31, 2018
` in Lakh
Particulars Note No. As at March 31, 2018
As at March 31, 2017
ASSETS(1) Non-Current Assets
(a) Property, plant and equipment 5 59,539.81 60,700.71 (b) Capital work-in-progress 7,090.80 423.04 (c) Intangible assets 6 9,059.42 10,536.96
75,690.03 71,660.71 (d) Financial assets
(i) Investments 7 31,766.20 12,233.47 (ii) Trade receivables 8 546.59 2,640.54 (iii) Other financial assets 9 1,370.78 4,735.16
33,683.57 19,609.17 (e) Non-current tax assets (net) 10 4,508.45 5,161.90 (f) Other non-current assets 11 20,451.09 20,542.07
Total Non -Current Assets 134,333.14 116,973.85(2) Current Assets
(a) Inventories 12 44,789.18 26,976.08 (b) Financial assets
(i) Trade receivables 13 483,524.51 394,883.65 (ii) Cash and cash equivalents 14 17,631.36 12,302.48 (iii) Bank balances other than (ii) above 15 3,802.95 3,244.23 (iv) Loans 16 21,527.12 18,260.85 (v) Other financial assets 17 208,124.50 156,878.95
734,610.44 585,570.16 (c) Current tax assets (net) 18 8,398.40 4,009.37 (d) Other current assets 19 51,346.13 35,432.33
Total Current Assets 839,144.15 651,987.94 Total Assets 973,477.29 768,961.79
EQUITY AND LIABILITIES Equity
(a) Equity share capital 20 5,141.77 5,141.77 (b) Other equity 21 198,723.09 160,432.08
Total Equity 203,864.86 165,573.85Liabilities
(1) Non-current liabilities(a) Financial Liabilities
Borrowings 22 40,062.34 26,089.21
(b) Provisions 23 1,337.23 888.58 (c) Deferred tax liabilities (net) 24 12,512.98 13,212.56
Total Non-Current Liabilities 53,912.55 40,190.35(2) Current liabilities
(a) Financial liabilities(i) Borrowings 25 89,255.67 120,070.21 (ii) Trade payables 26 445,051.03 297,350.33 (iii) Other financial liabilities 27 7,926.48 2,925.90
542,233.18 420,346.44 (b) Other current liabilities 28 157,683.30 129,722.38 (c) Provisions 29 7,733.20 9,712.07 (d) Current tax liabilities (net) 30 8,050.20 3,416.70
Total Current Liabilities 715,699.88 563,197.59 Total Equity and Liabilities 973,477.29 768,961.79
The above balance sheet should be read in conjunction with the accompanying notes.
In terms of our report attached For and on behalf of the Board of Directors For Price Waterhouse Chartered Accountants LLPFirm Registration Number: 012754N/N500016Chartered Accountants
H. V. GOENKAChairmanDIN - 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWAL Partner Chief Financial Officer Managing Director & CEO Membership Number: 045255 DIN - 00026981
A. T. VASWANIPlace: Mumbai Place: Mumbai DirectorDate: May 14, 2018 Date: May 14, 2018 DIN - 00057953
190 KEC International Limited Annual Report 2017-18190
STATEMENT OF PROFIT AND LOSS for the year ended March 31, 2018
The above statement of profit and loss should be read in conjunction with the accompanying notes.
In terms of our report attached For and on behalf of the Board of Directors For Price Waterhouse Chartered Accountants LLPFirm Registration Number: 012754N/N500016Chartered Accountants
H. V. GOENKAChairmanDIN - 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWAL Partner Chief Financial Officer Managing Director & CEO Membership Number: 045255 DIN - 00026981
A. T. VASWANIPlace: Mumbai Place: Mumbai DirectorDate: May 14, 2018 Date: May 14, 2018 DIN - 00057953
` in Lakh
Particulars Note No. For the year ended March 31, 2018
For the year ended March 31, 2017
I Revenue from operations 31 907,573.70 773,708.55 II Other income 32 2,259.93 3,708.40 III Total Income (I+II) 909,833.63 777,416.95 IV Expenses
(i) Cost of materials consumed 33 467,623.72 359,992.10 (ii) Changes in inventories of finished goods and work-in-progress 34 (6,454.90) 163.20 (iii) Erection and sub-contracting expenses 35 212,651.61 177,340.84 (iv) Excise duty on sale of goods 3,834.69 17,065.02 (v) Employee benefits expense 36 56,211.55 50,591.74 (vi) Finance costs 37 19,581.42 20,883.14 (vii) Depreciation and amortisation expense 38 9,543.40 11,538.91 (viii) Other expenses 39 82,694.27 97,488.53 Total expenses 845,685.76 735,063.48
V Profit before tax (III - IV) 64,147.87 42,353.47 VI Tax expense: 40
(i) Current tax 21,599.92 11,666.71 (ii) Deferred tax (456.80) 2,504.28
21,143.12 14,170.99 VII Profit for the the year (V-VI) 43,004.75 28,182.48 VIII Other Comprehensive Income
A(i) Items that will not be reclassified to profit or loss - Remeasurement of defined benefit obligations 47 (254.10) (204.57)
(ii) Income tax relating to items that will not be reclassified to profit or loss 40.2 98.93 70.80 B(i) Items that will be reclassified to profit or loss 21
- Exchange differences on translating the financial statements of foreign joint operations
23.83 (830.20)
-Deferred (Losses)/ Gains on Cash flow hedges (612.81) 9.25 (ii) Income tax relating to items that will be reclassified to profit or loss 40.2 143.85 120.24
Total Other Comprehensive Income (600.30) (834.48)IX Total Comprehensive Income for the year (VII + VIII) (Comprising Profit and
Other Comprehensive Income for the year) 42,404.45 27,348.00
X Earnings per equity share for continuing operation (of ` 2 each)(i) Basic 41 16.73 10.96 (ii) Diluted 16.73 10.96
191191Company Overview Financial StatementsStatutory Reports
STATEMENT OF CHANGES IN EQUITY for the year ended March 31,2018
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192 KEC International Limited Annual Report 2017-18192
CASH FLOW STATEMENT for the year ended March 31,2018
` in Lakh
Particulars For the year ended March 31, 2018
For the year ended March 31, 2017
A. CASH FLOW FROM OPERATING ACTIVITIES:Profit for the year after tax 43,004.75 28,182.48 Adjustments for:Income tax expense 21,143.12 14,170.99 Depreciation and amortisation expense 9,543.40 11,538.91 Amortization of leasehold prepayments - 62.68 Profit on sale of property, plant and equipment (net) (41.61) (19.31)Loss on property, plant and equipment discarded & intangible assets derecognised
119.15 1,528.74
Finance costs 19,581.42 20,883.14 Interest income (1,474.93) (2,541.68)Adjustment on account of fair value of financial guarantees (256.53) (468.34)Dividend income from equity instruments in subsidiary 132.54 - Bad debts, loans and advances written off (net) 5,463.80 19,767.73 Allowance for bad and doubtful debts, loans and advances (net) 2,268.68 1,948.08 Mark to market loss on forward and commodity contracts 901.94 400.70 Net loss arising on financial assets mandatorily measured at FVTPL 225.00 429.00 Net unrealised exchange (gain) / loss (796.72) 760.76
56,809.26 68,461.40 Changes in assets and liabilities 99,814.01 96,643.88 Changes in working capital:Adjustments for (increase) / decrease in operating assets:Inventories (17,813.10) (1,705.79)Trade receivables (91,670.61) 23,998.79 Loans 571.78 7,280.88 Other financial assets (49,377.27) 58.65 Other current assets (15,913.80) (17,572.68)Other non-current assets 119.96 4,098.50
(174,083.04) 16,158.35 Adjustments for increase / (decrease) in operating liabilities:Trade payables 147,196.63 32,342.37 Other current liabilities 27,960.92 17,983.09 Other financial liabilities (702.69) 103.73 Provisions (1,579.76) (17.96)
172,875.10 50,411.23 98,606.07 163,213.46
Taxes paid (net of refunds) (21,187.57) (8,719.77)NET CASH FLOW GENERATED BY / (USED IN) OPERATING ACTIVITIES (A) 77,418.50 154,493.69
193193Company Overview Financial StatementsStatutory Reports
` in Lakh
Particulars For the year ended March 31, 2018
For the year ended March 31, 2017
B. CASH FLOW FROM INVESTING ACTIVITIESCapital expenditure on property, plant and equipment & intangible assets (after adjustment of increase/decrease in capital work-in-progress and advances for capital expenditure)
(13,468.42) (5,896.86)
Proceeds from sale of property, plant and equipment 140.19 146.17 Payment towards investments in subsidiaries (including share application money)
(19,501.21) (2,050.00)
Loans given to a subsidiary (19,661.91) (9,974.68)Loans repaid by a subsidiary 16,614.13 3,531.06 Interest received 1,135.68 1,403.03 Dividend received from a subsidiary (132.54) - Bank balances (including non-current) not considered as Cash and cash equivalents (net)
165.39 (2,424.20)
(34,708.69) (15,265.48)NET CASH FLOW USED IN INVESTING ACTIVITIES (B) (34,708.69) (15,265.48)
C. CASH FLOW FROM FINANCING ACTIVITIESProceeds from other than short-term borrowings (including debentures) 15,509.87 25,000.00 Repayments of other than short-term borrowings (including debentures) - (22,049.16)Repayment of finance lease obligations (329.58) (429.99)Net increase / (decrease) in short-term borrowings (31,501.50) (114,165.80)Finance costs paid (16,946.44) (20,986.93)Dividend paid (including tax on distributed profit) (4,113.38) (112.42)
(37,381.03) (132,744.30)NET CASH FLOW (USED IN) / GENERATED BY FINANCING ACTIVITIES (C) (37,381.03) (132,744.30)NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS (A+B+C) 5,328.78 6,483.91 Cash and cash equivalents at the beginning of the year (Refer Note 14) 12,302.48 5,818.75 Effect of exchange differences on restatement of foreign currency Cash and cash equivalents
0.11 (0.18)
Cash and cash equivalents at the end of the year (Refer Note 14) 17,631.36 12,302.48
Reconciliation of liabilities arising from financing activities:` in Lakh
Particulars As at March 31, 2017
Cash flows
Non-cash changesAs at
March 31, 2018AcquisitionForeign exchange
movementInterest accrued
Debentures 26,006.52 - - - 2,532.90 28,539.42 Long term borrowings - 15,509.87 - - 289.53 15,799.40 Short term borrowings 120,070.21 (31,501.50) - 686.96 - 89,255.67 Lease liabilities (including current maturities of finance lease obligations)
420.86 (329.58) - - - 91.28
Total liabilities from financing activities
146,497.59 (16,321.21) - 686.96 2,822.43 133,685.77
The above Cash Flow Statement should be read in conjunction with the accompanying notes.
In terms of our report attached For and on behalf of the Board of Directors For Price Waterhouse Chartered Accountants LLPFirm Registration Number: 012754N/N500016Chartered Accountants
H. V. GOENKAChairmanDIN - 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWAL Partner Chief Financial Officer Managing Director & CEO Membership Number: 045255 DIN - 00026981
A. T. VASWANIPlace: Mumbai Place: Mumbai DirectorDate: May 14, 2018 Date: May 14, 2018 DIN - 00057953
CASH FLOW STATEMENT for the year ended March 31,2018
194 KEC International Limited Annual Report 2017-18194
KEC International Limited Annual Report 2017-18
INDEPENDENT AUDITORS’ REPORT
To the Members of KEC International Limited
REPORT ON THE CONSOLIDATED INDIAN ACCOUNTING STANDARDS (IND AS) FINANCIAL STATEMENTS
1. We have audited the accompanying consolidated Ind AS financial statements of KEC International Limited in which are incorporated 20 jointly controlled operations and the Returns of the Company’s branches at Abu Dhabi, Afghanistan, Algeria, Bangladesh, Egypt, Ethiopia, Georgia, Ghana, Indonesia, Ivory Coast, Jordan, Kenya, Laos, Lebanon, Libya, Malaysia(2), Mozambique, Nepal(2), Nigeria, Oman, Philippines, Senegal, South Africa, Sri Lanka, Tanzania, Thailand, Tunisia, Uganda, Zambia (“hereinafter referred to as the Holding Company”) and its subsidiaries (the Holding Company and its subsidiaries together referred to as “the Group”); (refer Note 45 to the attached consolidated financial statements), comprising of the consolidated Balance Sheet as at March 31, 2018, the consolidated Statement of Profit and Loss (including Other Comprehensive Income), the consolidated Cash Flow Statement for the year then ended and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information prepared based on the relevant records (hereinafter referred to as “the Consolidated Ind AS Financial Statements”).
MANAGEMENT’S RESPONSIBILITY FOR THE CONSOLIDATED IND AS FINANCIAL STATEMENTS
2. The Holding Company’s Board of Directors is responsible for the preparation of these consolidated Ind AS financial statements in terms of the requirements of the Companies Act, 2013 (hereinafter referred to as “the Act”) that give a true and fair view of the consolidated financial position, consolidated financial performance, consolidated cash flows and changes in equity of the Group in accordance with accounting principles generally accepted in India including the Indian Accounting Standards specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act. The Holding Company’s Board of Directors is also responsible for ensuring accuracy of records including financial information considered necessary for the preparation of consolidated Ind AS financial statements. The respective Board of Directors of the companies included in the Group are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Group and for preventing and detecting frauds and other irregularities; the selection and application of appropriate accounting policies; making judgements and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which has been used for the purpose of preparation of the consolidated Ind AS financial statements by the Directors of the Holding Company, as aforesaid.
AUDITORS’ RESPONSIBILITY
3. Our responsibility is to express an opinion on these consolidated Ind AS financial statements based on our audit. While conducting the audit, we have taken into account the provisions of the Act and the Rules made thereunder including the accounting standards and matters which are required to be included in the audit report.
4. We conducted our audit of the consolidated Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated Ind AS financial statements are free from material misstatement.
5. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated Ind AS financial statements. The procedures selected depend on the auditors’ judgement, including the assessment of the risks of material misstatement of the consolidated Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Holding Company’s preparation of the consolidated Ind AS financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Holding Company’s Board of Directors, as well as evaluating the overall presentation of the consolidated Ind AS financial statements.
6. We believe that the audit evidence obtained by us and the audit evidence obtained by the other auditors in terms of their reports referred to in the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the consolidated Ind AS financial statements.
OPINION
7. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidated Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity
110110
with the accounting principles generally accepted in India of the consolidated state of affairs of the Group as at March 31, 2018, and their consolidated total comprehensive income (comprising of consolidated profit and consolidated other comprehensive income), their consolidated cash flows and consolidated changes in equity for the year ended on that date.
OTHER MATTER
8. We did not audit the financial statements/financial information of 16 subsidiaries, 31 branches and 20 jointly controlled operations whose financial statements reflect total assets of ` 391,161.00 lakh and net assets of ` 76,240.63 lakh as at March 31, 2018, total revenue of ` 325,578.61 lakh and net cash flows amounting to (` 4,937.57 lakh) for the year ended on that date, as considered in the consolidated Ind AS financial statements. These financial statements/financial information have been audited by other auditors whose reports have been furnished to us by the Management, and our opinion on the consolidated Ind AS financial statements insofar as it relates to the amounts and disclosures included in respect of these subsidiaries, branches and jointly controlled operations and our report in terms of sub-section (3) of Section 143 of the Act insofar as it relates to the subsidiaries incorporated in India and branches, is based solely on the reports of such other auditors.
Our opinion on the consolidated Ind AS financial statements and our report on Other Legal and Regulatory Requirements below, is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors and the financial statements/ financial information certified by the Management.
9. The consolidated Ind AS financial statements of the Company for the year ended March 31, 2017, were audited by another firm of chartered accountants under the Companies Act, 2013 who, vide their report dated May 19, 2017, expressed an unmodified opinion on those financial statements. Our opinion is not qualified in respect of this matter.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
10. As required by Section143(3) of the Act, to the extent applicable, that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit of the aforesaid consolidated Ind AS financial statements.
(b) In our opinion, proper books of account as required by law maintained by the Holding Company, and its subsidiaries
incorporated in India including relevant records relating to preparation of the aforesaid consolidated Ind AS financial statements have been kept so far as it appears from our examination of those books and records of the Holding Company and the reports of the other auditors.
(c) The Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss (including other comprehensive income), Consolidated Cash Flow Statement and the Consolidated Statement of Changes in Equity dealt with by this Report are in agreement with the relevant books of account maintained by the Holding Company and its subsidiaries incorporated in India including relevant records relating to the preparation of the consolidated Ind AS financial statements.
(d) In our opinion, the aforesaid consolidated Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.
(e) On the basis of the written representations received from the directors of KEC International Limited as on March 31, 2018 taken on record by the Board of Directors of KEC International Limited and the reports of the statutory auditors of its subsidiary companies incorporated in India, none of the directors of the Group are disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164 (2) of the Act.
(f) With respect to the adequacy of the internal financial controls with reference to financial statements of the Holding Company and its subsidiary companies incorporated in India and the operating effectiveness of such controls, refer to our separate Report in Annexure A.
(g) With respect to the other matters to be included in the Auditors’ Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The consolidated Ind AS financial statements disclose the impact, if any, of pending litigations as at March 31, 2018 on the consolidated financial position of the Group – Refer Note 52 to the consolidated Ind AS financial statements.
ii. Provision has been made in the consolidated Ind AS financial statements, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts as at March 31, 2018
111111Company Overview Statutory Reports Financial Statements
KEC International Limited Annual Report 2017-18
ANNEXURE ‘A’ TO INDEPENDENT AUDITORS’ REPORTReferred to in paragraph 10(f) of the Independent Auditors’ Report of even date to the members of KEC international Limited on the consolidated financial statements for the year ended March 31, 2018
REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) OF SUB-SECTION 3 OF SECTION 143 OF THE ACT
1. In conjunction with our audit of the consolidated financial statements of the Company as of and for the year ended March 31, 2018, we have audited the internal financial controls over financial reporting of KEC International Limited including 36 branches (hereinafter referred to as “the Holding Company”) and 2 subsidiary companies, which are companies incorporated in India, as of that date.
MANAGEMENT’S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
2. The respective Board of Directors of the Holding company and its subsidiary companies, to whom reporting under clause (i) of sub section 3 of Section 143 of the Act in respect of the adequacy of the internal financial controls over financial reporting is applicable, which are companies incorporated in India, are responsible for establishing and maintaining internal financial controls based on internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the respective company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the
accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
AUDITOR’S RESPONSIBILITY
3. Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the ICAI and the Standards on Auditing deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected
– Refer Note 32 to the consolidated Ind AS financial statements in respect of such items as it relates to the Group
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Holding Company and its subsidiary companies incorporated in India during the year ended March 31, 2018.
iv. The reporting on disclosures relating to Specified Bank Notes is not applicable to the Group for the year ended March 31, 2018.
For Price Waterhouse Chartered Accountants LLP Firm Registration Number: 012754N/N500016
Chartered Accountants
Sarah GeorgePlace: Mumbai PartnerDate: May 14, 2018 Membership Number: 045255
112112
depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained and the audit evidence obtained by the other auditors in terms of their reports referred to in the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.
MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
6. A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
7. Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material
misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
OPINION
8. In our opinion, the Holding Company and its 2 subsidiary companies, which are companies incorporated in India, have, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
OTHER MATTERS
9. Our aforesaid reports under Section 143(3)(i) of the Act on the adequacy and operating effectiveness of the internal financial controls over financial reporting insofar as it relates to 2 subsidiary companies, which are companies incorporated in India and 31 branches, is based on the corresponding reports of auditors of such companies incorporated in India and branches. Our opinion is not qualified in respect of this matter.
For Price Waterhouse Chartered Accountants LLP Firm’s Registration Number: 012754N/N500016
Chartered Accountants
Sarah GeorgePlace: Mumbai PartnerDate: May 14, 2018 Membership Number: 045255
113113Company Overview Statutory Reports Financial Statements
KEC International Limited Annual Report 2017-18
CONSOLIDATED BALANCE SHEET as at March 31, 2018
` in Lakh
Particulars Note No.As at
March 31, 2018As at
March 31, 2017
ASSETS(1) Non-current Assets
(a) Property, plant and equipment 5 82,875.93 85,157.59 (b) Capital work-in-progress 7,807.20 510.34 (c) Goodwill 6 19,198.43 19,102.68 (d) Intangible assets 7 9,145.67 10,615.06
119,027.23 115,385.67 (e) Financial assets
(i) Investments 8 0.49 0.49 (ii) Trade receivables 9 546.59 2,640.54 (iii) Other financial assets 10 20,553.51 21,978.80
21,100.59 24,619.83 (f) Deferred tax assets (net) 27 2,649.66 1,332.13 (g) Non-current tax assets (net) 11 4,514.95 5,201.21 (h) Other non-current assets 12 22,721.94 20,853.44
Total Non -Current Assets 170,014.37 167,392.28(2) Current assets
(a) Inventories 13 62,741.39 39,466.88 (b) Financial assets
(i) Investments 14 3,929.44 13,039.16 (ii) Trade receivables 15 503,893.30 420,035.00 (iii) Cash and cash equivalents 16 19,299.61 17,552.87 (iv) Bank balances other than (iii) above 17 3,830.66 3,244.23 (v) Loans 18 6,044.16 6,240.41 (vi) Other financial assets 19 213,572.81 157,101.39
750,569.98 617,213.06 (c) Current tax assets (net) 20 9,961.79 5,416.41 (d) Other current assets 21 60,610.67 43,324.08
Total Current Assets 883,883.83 705,420.43 Total Assets 1,053,898.20 872,812.71
EQUITY AND LIABILITIES Equity
(a) Equity share capital 22 5,141.77 5,141.77 (b) Other equity 23 194,603.44 153,493.62
Equity attributable to owners of the Company 199,745.21 158,635.39 (c) Non-controlling interests 24 * *
Total Equity 199,745.21 158,635.39Liabilities
(1) Non-current liabilities(a) Financial liabilities
Borrowings 25 73,843.71 77,566.00 (b) Provisions 26 1,767.69 1,458.76 (c) Deferred tax liabilities (net) 27 12,720.04 13,732.37
Total Non-Current Liabilities 88,331.44 92,757.13(2) Current liabilities
(a) Financial liabilities(i) Borrowings 28 90,097.63 123,253.63 (ii) Trade payables 29 465,717.38 316,719.96 (iii) Other financial liabilities 30 17,085.07 12,417.27
572,900.08 452,390.86 (b) Other current liabilities 31 174,623.99 155,225.63 (c) Provisions 32 8,324.41 10,272.75 (d) Current tax liabilities (net) 33 9,973.07 3,530.95
Total Current Liabilities 765,821.55 621,420.19 Total Equity and Liabilities 1,053,898.20 872,812.71
* less than rounding off norms adopted by the Company.
The above Consolidated Balance Sheet should be read in conjunction with the accompanying notes.
In terms of our report attached For and on behalf of the Board of Directors For Price Waterhouse Chartered Accountants LLPFirm Registration Number: 012754N/N500016Chartered Accountants
H. V. GOENKAChairmanDIN - 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWAL Partner Chief Financial Officer Managing Director & CEO Membership Number: 045255 DIN - 00026981
A. T. VASWANIPlace: Mumbai Place: Mumbai DirectorDate: May 14, 2018 Date: May 14, 2018 DIN - 00057953
114114
CONSOLIDATED STATEMENT OF PROFIT AND LOSS for the year ended March 31, 2018
` in Lakh
Particulars Note No. For the year ended March 31, 2018
For the year ended March 31, 2017
I Revenue from operations 34 1,009,636.83 875,504.52 II Other income 35 4,041.20 2,886.61 III Total Income (I+II) 1,013,678.03 878,391.13 IV Expenses
(i) Cost of materials consumed 36 524,945.20 417,369.73 (ii) Changes in inventories of finished goods and work-in-progress 37 (10,486.19) (906.52)(iii) Erection and sub-contracting expenses 38 212,696.91 178,429.01 (iv) Excise duty on sale of goods 3,834.69 17,065.02 (v) Employee benefits expense 39 79,835.25 73,266.57 (vi) Finance costs 40 24,661.33 25,361.17 (vii) Depreciation and amortisation expense 41 10,974.37 12,968.75 (viii) Other expenses 42 98,192.82 108,493.01
Total expenses 944,654.38 832,046.74 V Profit before tax (III - IV) 69,023.65 46,344.39 VI Tax expense : 43
(i) Current tax 24,931.64 13,480.16 (ii) Deferred tax (1,949.53) 2,386.39
22,982.11 15,866.55 VII Profit for the year (V-VI) 46,041.54 30,477.84 VIII Other Comprehensive Income
A(i) Items that will not be reclassified to profit or loss- Remeasurement of defined benefit obligations 50 (202.06) (172.34)
(ii) Income tax relating to items that will not be reclassified to profit or loss 43.2 83.32 61.13 B(i) Items that will be reclassified to profit or loss 23
- Exchange differences on translating the financial statements of joint operations and subsidiaries
(228.06) (899.33)
- Net gain/(losses) on cash flow hedges (612.81) 9.25 (ii) Income tax relating to items that will be reclassified to profit or loss 43.2 143.85 120.24 Total Other Comprehensive Income (815.76) (881.05)
IX Total Comprehensive Income for the year (VII+VIII) (Comprising Profit and Other Comprehensive Income for the period)
45,225.78 29,596.79
Profit for the year attributable to:Owners of the Company 46,041.54 30,477.84 Non-controlling interests 24 * * Other Comprehensive Income attributable to:Owners of the Company (815.76) (881.05)Non-controlling interests 24 * * Total Other Comprehensive Income attributable to:Owners of the Company 45,225.78 29,596.79 Non-controlling interests 24 * *
X Earnings per equity share for continuing operations (of ` 2 each)(i) Basic 44 17.91 11.86 (ii) Diluted 17.91 11.86
* less than rounding off norms adopted by the Company.
The above Consolidated Statement of Profit and Loss should be read in conjunction with the accompanying notes.
In terms of our report attached For and on behalf of the Board of Directors For Price Waterhouse Chartered Accountants LLPFirm Registration Number: 012754N/N500016Chartered Accountants
H. V. GOENKAChairmanDIN - 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWAL Partner Chief Financial Officer Managing Director & CEO Membership Number: 045255 DIN - 00026981
A. T. VASWANIPlace: Mumbai Place: Mumbai DirectorDate: May 14, 2018 Date: May 14, 2018 DIN - 00057953
115115Company Overview Statutory Reports Financial Statements
KEC International Limited Annual Report 2017-18
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended March 31,2018
A.
EQ
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HA
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as
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1, 2
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B.
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)B
alan
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6 (2
9.15
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,497
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3.7
2 8
,674
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1,4
27.9
5 9
42.6
3 9
4.88
1
2,47
9.26
9
0,16
5.07
1
39.4
9 1
,811
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123
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ar-
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-
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-
-
30,
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84
-
-
-
30,
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84
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f tax
)-
-
-
-
-
-
-
-
-
6.0
5 (7
74.7
0) (1
11.2
1) (8
79.8
6)
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com
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ar -
-
-
-
-
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3
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6
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(111
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- -
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9
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--
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-
1
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(1.1
9) -
-
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(1
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Bal
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at
Mar
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(30.
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8,4
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9 1
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51
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9 (4
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2 B
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,037
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ar-
-
-
-
-
-
-
-
46,
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54
-
-
-
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Oth
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nsiv
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com
e fo
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)-
-
-
-
-
-
-
-
-
(394
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(302
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(118
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(815
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Tota
l Co
mp
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ar -
-
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4
6,04
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(3
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--
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9 Tr
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--
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-
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(2.5
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Bal
ance
as
at M
arch
31,
201
8 (3
2.88
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158,
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14
(249
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735
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(541
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194
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The
ab
ove
Sta
tem
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of
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nges
in E
qui
ty s
houl
d b
e re
ad in
co
njun
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n w
ith
the
acco
mp
anyi
ng n
ote
s.
In t
erm
s of
our
rep
ort
atta
ched
F
or a
nd o
n b
ehal
f of t
he B
oard
of D
irect
ors
For
Pri
ce W
ater
hous
e C
hart
ered
Acc
oun
tant
s LL
PFi
rm R
egis
trat
ion
Num
ber
: 012
754N
/N50
0016
Cha
rter
ed A
ccou
ntan
ts
H. V
. GO
EN
KA
Cha
irman
DIN
- 0
0026
726
SA
RA
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ER
AJE
EV
AG
GA
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AL
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AL
KE
JRIW
AL
Par
tner
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inan
cial
Offi
cer
Man
agin
g D
irect
or &
CE
O
Mem
ber
ship
Num
ber
: 045
255
DIN
- 0
0026
981
A. T
. VA
SW
AN
IP
lace
: Mum
bai
Pla
ce: M
umb
aiD
irect
orD
ate:
May
14,
201
8D
ate:
May
14,
201
8D
IN -
000
5795
3
116116
CONSOLIDATED CASH FLOW STATEMENT for the year ended March 31,2018
` in Lakh
Particulars For the year ended March 31, 2018
For the year ended March 31, 2017
A. CASH FLOW FROM OPERATING ACTIVITIES:Profit For The Year After Tax 46,041.54 30,477.84 Adjustments for:Income tax expense 22,982.11 15,866.55 Depreciation and amortisation expense 10,974.37 12,968.75 Amortization of leasehold prepayments - 62.68 Profit on sale of property, plant and equipment (net) (78.67) (39.58)Loss on property, plant and equipment discarded & intangible assets derecognised
119.15 1,528.74
Finance costs 24,661.33 25,361.17 Interest income (3,547.92) (2,137.48)Bad debts, loans and advances written off (net) 6,603.51 19,767.73 Allowance for bad and doubtful debts, loans and advances (net) 3,727.58 2,768.19 Mark to market loss on forward and commodity contracts 914.65 413.19 Net unrealised exchange (gain) / loss (102.95) (775.06)
66,253.16 75,784.88 Changes in assets and liabilities 112,294.70 106,262.72 Changes in working capital:Adjustments for (increase) / decrease in operating assets:Inventories (23,274.51) (3,451.16)Trade receivables (89,533.95) 25,392.87 Loans 281.65 7,280.88 Other financial assets (56,842.72) (16,509.43)Other current assets (17,286.59) (10,493.43)Other non-current assets (1,839.52) 3,989.47
(188,495.64) 6,209.20 Adjustments for increase / (decrease) in operating liabilities:Trade payables 148,105.89 35,130.94 Other current liabilities 19,398.36 28,996.20 Other financial liabilities (715.19) 103.73 Provisions (1,669.11) (103.21)
165,119.95 64,127.66 Cash Generated from Operations 88,919.01 176,599.58 Taxes paid (net of refunds) (22,956.14) (10,440.98)NET CASH FLOW GENERATED BY / (USED IN) OPERATING ACTIVITIES (A)
65,962.87 166,158.60
117117Company Overview Statutory Reports Financial Statements
KEC International Limited Annual Report 2017-18
` in Lakh
Particulars For the year ended March 31, 2018
For the year ended March 31, 2017
B. CASH FLOW FROM INVESTING ACTIVITIESCapital expenditure on property, plant and equipment & intangible assets (after adjustment of increase/decrease in capital work-in-progress and advances for capital expenditure)
(13,740.04) (6,863.26)
Proceeds from sale of property, plant and equipment 188.32 166.53 Purchase of short-term investments (52,049.05) (10,501.41)Proceeds from disposal of short term investment 61,158.77 - Interest received 3,555.18 1,304.16 Bank balances (including non-current) not considered as Cash and cash equivalents (net)
441.13 (2,413.89)
(445.69) (18,307.87)NET CASH FLOW USED IN INVESTING ACTIVITIES (B) (445.69) (18,307.87)
C. CASH FLOW FROM FINANCING ACTIVITIESProceeds from other than short-term borrowings (including debentures) 19,512.82 47,646.89 Repayments of other than short-term borrowings (including debentures) (22,025.63) (39,098.51)Repayment of finance lease obligations (1,107.63) (1,029.56)Net increase / (decrease) in short-term borrowings (34,030.96) (119,747.59)Finance costs paid (22,051.22) (25,558.13)Dividend paid (including tax on distributed profit) (4,113.36) (112.42)
(63,815.98) (137,899.32)NET CASH FLOW USED IN FINANCING ACTIVITIES (C) (63,815.98) (137,899.32)NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS (A+B+C)
1,701.20 9,951.41
Cash and cash equivalents at the beginning of the year (Refer Note 16) 17,552.87 7,457.00 Effect of exchange differences on restatement of foreign currency Cash and cash equivalents
45.54 144.46
Cash and cash equivalents at the end of the year (Refer Note 16) 19,299.61 17,552.87
Reconciliation of liabilities arising from financing activities:` in Lakh
Particulars As at March 31, 2017
Cash flows
Non-cash changes
As at March 31, 2018Acquisition
Foreign exchange
movement
Interest accrued
Debentures 26,006.52 - - - 2,532.90 28,539.42 Long term borrowings including current maturities of long term debts (other than debentures and lease liabilities)
59,131.28 (2,512.81) - 290.75 328.01 57,237.23
Short term borrowings 123,253.63 (34,030.96) - 874.96 - 90,097.63 Lease liabilities (including current maturities of finance lease obligations)
2,181.90 (1,107.63) - 14.23 - 1,088.50
Total liabilities from financing activities 210,573.33 (37,651.40) - 1,179.94 2,860.91 176,962.78
The above Consolidated Cash Flow Statement should be read in conjunction with the accompanying notes.
In terms of our report attached For and on behalf of the Board of Directors For Price Waterhouse Chartered Accountants LLPFirm Registration Number: 012754N/N500016Chartered Accountants
H. V. GOENKAChairmanDIN - 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWAL Partner Chief Financial Officer Managing Director & CEO Membership Number: 045255 DIN - 00026981
A. T. VASWANIPlace: Mumbai Place: Mumbai DirectorDate: May 14, 2018 Date: May 14, 2018 DIN - 00057953
CONSOLIDATED CASH FLOW STATEMENT for the year ended March 31,2018
118118
INDEPENDENT AUDITORS’ REPORT
To the Members of KEC International Limited
REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS
OPINION
1. We have audited the accompanying Standalone financial statements of KEC International Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2019, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity, the Cash Flow Statement for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information, in which are incorporated 20 jointly controlled operations as referred to in Note 43 in the Standalone financial statements and Returns for the year ended on that date of the Company’s branches located at Abu Dhabi, Afghanistan, Algeria, Bangladesh, Egypt, Ethiopia, Georgia, Ghana, Guinea, Indonesia, Ivory Coast, Jordan, Kenya, Laos, Lebanon, Libya, Malaysia, Mali, Mozambique, Nepal, Nicaragua, Nigeria, Oman, Papua New Guinea, Philippines, Srilanka, Sierra Leone, Senegal, South Africa, Tanzania, Thailand, Tunisia, Uganda, Bhutan, Cameroon, Congo, Kazakhstan, Kuwait and Zambia.
2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone financial statements give the information required by the Companies Act, 2013 (“the Act”) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2019, and the total comprehensive income (comprising of profit and other comprehensive income), changes in equity and its cash flows for the year then ended.
BASIS FOR OPINION
3. We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained and the audit evidence obtained by the other auditors in terms of their reports referred to in sub-paragraph 14 of the Other Matter paragraph below is sufficient and appropriate to provide a basis for our opinion.
EMPHASIS OF MATTER
4. We draw your attention to Note 58 of the Standalone financial statements, regarding delays in recovery of receivable amounting to ` 145 Crores from a customer. The recovery of the amount is dependent upon transfer of contract from the customer to a new sponsor.
KEY AUDIT MATTERS
5. Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
186
KEC International Limited Annual Report 2018-19
Key audit matter How our audit addressed the key audit matter
Estimation of contract cost and revenue recognition(Refer note 3.5 and 32 of the standalone financial statements)
Contract revenue for engineering, procurement and construction contracts which usually extends over a period of 2-3 years, contract prices are fixed / subject to price variance clauses.
The contract revenue is measured based on the proportion of contract costs incurred for work performed to date relative to the estimated total contract costs, except where this would not be representative of the stage of completion.
This method requires the Company to perform an initial assessment of total estimated cost and further, reassess the total construction cost at each reporting period to determine the appropriate percentage of completion.
On transition to Indian Accounting Standard (IND AS) 115, Revenue from Contracts with Customers w.e.f. April 1, 2018, the management has performed a detailed evaluation of the implications under the new standard and has concluded that there are no material implications on account of applicability of Ind AS 115.
We considered the estimation of construction contract cost as a key audit matter given the involvement of significant management judgement which has consequential impact on revenue recognition.
Our procedures over the recognition of construction revenue included the following: • Understood and evaluated the design and tested effectiveness
of key internal financial controls, including those related to review and approval of estimated project cost and review of provision for estimated loss by the authorised representatives.
• For sample of contracts, we obtained the percentage of completion calculations, agreed key contractual terms back to signed contracts, tested the mathematical accuracy of the cost to complete calculations and re-performed the calculation of revenue recognized during the year based on the percentage of completion.
• For costs incurred to date, we tested samples to appropriate supporting documentation and performed cut off procedures.
• To test the forecasted cost to complete, we obtained the breakdown of forecasted costs and tested elements of the forecast by obtaining executed purchase orders and agreements, evaluating reasonableness of management’s judgements / and assumptions using past trends and comparing the estimated costs to the actual costs incurred for the similar completed projects.
• Checked the implications and related disclosures in the financial statements pursuant to applicability of Ind AS 115.
Based on the procedures performed above, we considered manner of estimation of contract cost and recognition of revenue to be reasonable.
Key audit matter How our audit addressed the key audit matter
Valuation of accounts receivable in view of risk of credit losses(Refer to Note 46 ‘Financial Instruments’ and Note 8 and 13 ‘Trade receivables’)
Accounts receivables is a significant item in the Company’s financial statements as at March 31, 2019 and assumptions used for estimating the credit loss on receivables is an area which is influenced by management’s judgment.
The Company makes an assessment of the estimated credit losses basis credit risk, project status, past history, latest discussion/ correspondence with the customer.
Given the relative significance of these receivables to the financial statements and the nature and extent of audit procedures involved to assess the recoverability of receivables, we determined this to be a key audit matter.
Our audit incorporated the following procedures with regards to provisioning of receivables; • Understood and evaluated the accounting policy of the
company.• We evaluated the design and tested the operating
effectiveness of key controls in relation to determination of estimated credit loss.
• Inquired with senior management regarding status of collectability of the receivable
• For material balances, the basis of provision was discussed with the audit committee.
• Assessed and challenged the information used by the Management to determine the expected credit losses by considering credit risk of the customer, cash collection, performance against historical trends and the level of credit loss charges over time.
Based on our work as stated above, no significant deviations were observed in respect of management’s assessment of valuation of accounts receivables.
Key audit matter How our audit addressed the key audit matter
Reliance on controls and processes relating to new IT system and data migration impacting financial reporting
The company migrated its transaction and financials systems from JD Edwards to SAP w.e.f. from April 1, 2018.
The migration has resulted in a significant change in the company’s process and the related controls.
Data migration, is assumed to have a significant impact on the processes and controls related to the financial reporting and consequently has been considered to be an area of audit focus and accordingly determined to be a key audit matter.
We performed following procedures with respect to the new system and data migration:• Obtained understanding and tested the controls over data
migration including proper authorization, completeness and accuracy.
• Tested the migrated balances, for completeness and accuracy as of April 1, 2018.
• We evaluated the design and operating effectiveness of the IT General Controls (ITGC), business process controls post migration (both automated and manual) of the new system.
We took the above procedures into consideration in planning and executing our audit.
187
Company Overview Statutory Reports Financial Statements
OTHER INFORMATION
6. The Company’s Board of Directors are responsible for the other information. The other information comprises the information included in the Annual Report, but does not include the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
RESPONSIBILITIES OF MANAGEMENT AND THOSE CHARGED WITH GOVERNANCE FOR THE STANDALONE FINANCIAL STATEMENTS
7. The Company’s Board of Directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these Standalone financial statements that give a true and fair view of the financial position, financial performance, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
8. In preparing the financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Those Board of Directors are also responsible for overseeing the Company’s financial reporting process.
AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS
9. Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
10. As part of an audit in accordance with SAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
11. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
12. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may
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reasonably be thought to bear on our independence, and where applicable, related safeguards.
13. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
OTHER MATTER
14. We did not audit the financial statements/financial information of 20 jointly controlled operations and 34 branches considered in the preparation of the Standalone financial statements which constitute total assets of ` 2,646 Crore and net assets of ` 394 Crore as at March 31, 2019, total revenue of ` 2,009 Crore, and net cash flows amounting to ̀ 23 Crore for the year then ended. These financial statements and other financial information have been audited by other auditors whose reports have been furnished to us, and our opinion on the Standalone financial statements (including other information) to the extent they have been derived from such financial statements/financial information is based solely on the report of such other auditors.
Our opinion is not modified in respect of this matter.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
15. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
16. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) 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 and the reports of the other auditors for the branches not audited by us and proper returns adequate for the purposes of our audit have been received from the branches not visited by us.
(c) The reports on the accounts of the branch offices of the Company audited under Section 143(8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.
(d) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity and dealt with by this Report are in agreement with the books of account and with the returns received from the branches not visited by us.
(e) In our opinion, the aforesaid Standalone financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.
(f) On the basis of the written representations received from the directors as on March 31, 2019 taken on record by the Board of Directors, none of the directors are disqualified as on March 31, 2019 from being appointed as a director in terms of Section 164 (2) of the Act.
(g) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure A”.
(h) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact, if any, of pending litigations as at March 31, 2019 on its financial position in its financial statements – Refer Note 50 to the financial statements;
ii. The Company has made provision as at March 31, 2019, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts – Refer Note 18(a) and 30 to the Standalone financial statements. Further, the Company did not have any material foreseeable losses on derivative contracts as at March 31, 2019;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year March 31, 2019;
iv. The reporting on disclosures relating to Specified Bank Notes is not applicable to the Company for the year ended March 31, 2019.
For Price Waterhouse Chartered Accountants LLP Firm Registration Number: 012754N/N500016
Chartered Accountants
Sarah George Place: Mumbai PartnerDate: May 08, 2019 Membership Number 045255
189
Company Overview Statutory Reports Financial Statements
REPORT ON THE INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO FINANCIAL STATEMENTS UNDER CLAUSE (I) OF SUB-SECTION 3 OF SECTION 143 OF THE ACT
1. We have audited the internal financial controls with reference to financial statements of KEC International Limited (“the Company”) as of March 31, 2019 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date, which includes the internal financial controls over financial reporting of the Company’s 39 branches.
MANAGEMENT’S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
2. The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
AUDITOR’S RESPONSIBILITY
3. Our responsibility is to express an opinion on the Company’s internal financial controls with reference to financial statements based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing deemed to be prescribed under section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to financial statements was established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system with reference to financial statements and their operating effectiveness. Our audit of internal financial controls with reference to financial statements included obtaining an understanding of internal financial controls with reference to financial statements, assessing the risk that a
material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting with reference to financial statements.
MEANING OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO FINANCIAL STATEMENTS
6. A company’s internal financial controls with reference to financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial controls with reference to financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO FINANCIAL STATEMENTS
7. Because of the inherent limitations of internal financial controls with reference to financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to financial statements to future periods are subject to the risk that the internal financial control controls with reference to financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
OPINION
8. In our opinion, the Company has, in all material respects, an adequate internal financial controls system with reference to financial statements and such internal financial controls with
ANNEXURE A TO INDEPENDENT AUDITORS’ REPORTReferred to in paragraph 16(g) of the Independent Auditors’ Report of even date to the members of KEC International Limited on the Standalone financial statements for the year ended March 31, 2019
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KEC International Limited Annual Report 2018-19
reference to financial statements were operating effectively as at March 31, 2019, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
OTHER MATTER
9. Our aforesaid report under Section 143(3)(i) of the Act on the adequacy and operating effectiveness of the internal financial controls with reference to financial statements insofar as it relates to 34 branches, is based on the corresponding reports of the auditors of such branches. Our opinion is not qualified in respect of this matter.
For Price Waterhouse Chartered Accountants LLP Firm Registration Number: 012754N/N500016
Chartered Accountants
Sarah George Place: Mumbai PartnerDate: May 08, 2019 Membership Number 045255
191
Company Overview Statutory Reports Financial Statements
i. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.
(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of 3 years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.
(c) The title deeds of immovable properties, other than for self-constructed buildings, as disclosed in Note 5 on Property, plant and equipment to the financial statements, are held in the name of the Company, except in respect of Industrial plots situated at Gandhinagar, Gujarat, admeasuring to 4,891.45 sq. meters, Industrial plot situated at Mysore, Karnataka, admeasuring to 80,773 sq. meters, land and building situated at Jabalpur, Madhya Pradesh, admeasuring to 9,000 Sq. feet and a flat at Worli, Mumbai, admeasuring to 1,088.22 sq. feet, having Gross carrying amount aggregating ` 26.35 Crore and Net carrying amount aggregating ` 25.74 Crore as at Balance Sheet date, the titles of which have been transferred to and vested in the Company, pursuant to schemes of amalgamation/arrangement in the earlier years and the procedural formalities for transfer in the name of the Company in the relevant documents have not been completed.
ii. The physical verification of inventory excluding stocks with third parties have been conducted at reasonable intervals by the Management during the year. The discrepancies noticed on physical verification of inventory as compared to book records were not material and have been appropriately dealt with in the books of accounts.
iii. The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under
Section 189 of the Act. Therefore, the provisions of Clause 3(iii), (iii)(a), (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.
iv. In our opinion, and according to the information and explanations given to us, the Company has complied with the provisions of Section 185 and 186 of the Companies Act, 2013 in respect of the loans and investments made, and guarantees and security provided by it.
v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.
vi. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of its products. We have broadly reviewed the same, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.
vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing the undisputed statutory dues, including provident fund, employees’ state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess, goods and service tax with effect from July 1, 2017 and other material statutory dues, as applicable, with the appropriate authorities. Also refer note 56 to the financial statements regarding management’s assessment on certain matters relating to provident fund.
(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of goods and service tax, which have not been deposited on account of any dispute. The particulars of dues of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax as at March 31, 2019 which have not been deposited on account of a dispute, are as follows:
Name of the statute Nature of dues Amount
(` in crore)Period to which the
amount relatesForum where the dispute is pending
The Central Sales Tax Act, 1956 and Local Sales Tax Acts
Sales tax and value added tax
0.51 1999-2000 to 2015-2016
Appellate Tribunal
0.48 1994-1995 to 1997-1998 and 2008-2009
Rajasthan Tax Board, Ajmer
2.43 2003-2004 to 2011-2012
Commercial Tax Appellate Board, Madhya Pradesh
18.89 2006-2007 to 2013-2014
Revisionary Board of Madhya Pradesh & West Bengal
34.58 1995-1996 to 2016-2017
Appellate Authority – up to Commissioner’s level
ANNEXURE B TO INDEPENDENT AUDITORS’ REPORTReferred to in paragraph 15 of the Independent Auditors’ Report of even date to the members of KEC International Limited on the standalone financial statements as of and for the year ended March 31, 2019
192
KEC International Limited Annual Report 2018-19
Name of the statute Nature of dues Amount
(` in crore)Period to which the
amount relatesForum where the dispute is pending
The Finance Act, 1994 Service Tax 294.13 2004-2005 to 2012-2013
Customs Excise and Service Tax Appellate Tribunal (CESTAT)
The Customs Act, 1962 Customs Duty 0.60 1995-1996 High Court
The Central Excise Act, 1944
Excise Duty 11.99 1994-1995 to 2016-2017
Appellate Authority – up to Commissioner’s level
22.14 1988-1989 to 1993-1994, 2004-2005 to 2016-2017
Customs Excise and Service Tax Appellate Tribunal (CESTAT)
0.62 2001-2002 to 2005-2006
Mumbai High Court
0.13 2008-2009 to 2009-2010
Supreme Court of India
The Income- Tax Act, 1961
Income-Tax 1.93 Assessment Year 2007-2008
Income Tax Appellate Tribunal
0.54 Assessment Year 2008-2009
High Court
The Rajasthan Tax on Entry of Goods into Local Areas Act, 1999
Entry Tax 1.13 1995-1996, 2004-2005, 2008-2009 to 2013-2014
Appellate Authority – up to Deputy Commissioner’s level
Entry Tax Act, 1976, Madhya Pradesh
Entry Tax 0.29 2001-2002 to 2002-2003, 2009-2010 to 2011-2012,
2015-2016
Appellate Authority – up to Deputy Commissioner’s level, Board of Appeals, Madhya Pradesh
*Net of amounts paid including under protest
Note: For the above purpose, only statutory dues payable in India have been considered
viii. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of loans or borrowings to any financial institution or bank or Government or dues to debenture holders as at the balance sheet date.
ix. The Company has not raised any moneys by way of initial public offer, further public offer (including debt instruments) and term loans. Accordingly, the provisions of Clause 3(ix) of the Order are not applicable to the Company.
x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.
xi. The Company has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions
have been disclosed in the financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act.
xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under audit. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.
xv. The Company has not entered into any non cash transactions with its directors or persons connected with them. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.
xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.
For Price Waterhouse Chartered Accountants LLP Firm Registration Number: 012754N/N500016
Chartered Accountants
Sarah George Place: Mumbai PartnerDate: May 08, 2019 Membership Number 045255
193
Company Overview Statutory Reports Financial Statements
BALANCE SHEETas on March 31, 2019
` in Crore
Particulars Note No.As at
March 31, 2019As at
March 31, 2018
ASSETS(1) Non-Current Assets (a) Property, plant and equipment 5 616.77 595.40 (b) Capital work-in-progress 5.27 70.91 (c) Intangible assets 6 110.96 90.59
733.00 756.90 (d) Financial assets (i) Investments 7 435.98 317.66 (ii) Trade receivables 8 - 5.47 (iii) Other financial assets 9 13.58 13.71
449.56 336.84 (e) Non-current tax assets (net) 10 114.49 45.08 (f) Other non-current assets 11 166.40 204.51 Total Non-Current Assets 1,463.45 1,343.33(2) Current Assets (a) Inventories 12 469.23 447.90 (b) Financial assets (i) Trade receivables 13 4,734.49 4,835.25 (ii) Cash and cash equivalents 14 146.69 176.31 (iii) Bank balances other than (ii) above 15 100.65 38.03 (iv) Loans 16 67.37 215.27 (v) Other financial assets 17 101.53 2,081.24
5,150.73 7,346.10 (c) Contract Assets 18 (a) 3,226.01 - (d) Current tax assets (net) 19 13.61 83.98 (e) Other current assets 20 777.20 513.46 Total Current Assets 9,636.78 8,391.44 Total Assets 11,100.23 9,734.77EQUITY AND LIABILITIESEquity (a) Equity share capital 21 51.42 51.42 (b) Other equity 22 2,442.92 1,987.23 Total Equity 2,494.34 2,038.65Liabilities(1) Non-current liabilities (a) Financial Liabilities Borrowings 23 377.92 400.63 (b) Provisions 24 10.27 13.37 (c) Deferred tax liabilities (net) 25 143.57 125.13 Total Non-Current Liabilities 531.76 539.13(2) Current liabilities (a) Financial liabilities (i) Borrowings 26 1,143.84 892.56 (ii) Trade payables 27 - total outstanding dues of micro and small enterprises 71.19 - - total outstanding dues other than micro and small enterprises 4,545.75 4,451.18 (iii) Other financial liabilities 28 71.38 78.59
5,832.16 5,422.33 (b) Contract Liabilities 18 (b) 2,086.14 - (c) Other current liabilities 29 81.03 1,576.83 (d) Provisions 30 44.05 77.33 (e) Current tax liabilities (net) 31 30.75 80.50 Total Current Liabilities 8,074.13 7,156.99 Total Equity And Liabilities 11,100.23 9,734.77
The above balance sheet should be read in conjunction with the accompanying notes.
In terms of our report attached For and on behalf of the Board of Directors
For Price Waterhouse Chartered Accountants LLP H. V. GOENKAFirm Registration Number: 012754N/N500016 ChairmanChartered Accountants DIN: 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWALPartner Chief Financial Officer Managing Director & CEOMembership Number: 045255 DIN: 00026981
AMIT KUMAR GUPTA A. T. VASWANICompany Secretary Director
DIN: 00057953Place: Mumbai Place: MumbaiDate: May 08, 2019 Date: May 08, 2019
194
KEC International Limited Annual Report 2018-19
STATEMENT OF PROFIT AND LOSSfor the year ended March 31, 2019
` in Crore
Particulars Note No.For the year ended
March 31, 2019For the year ended
March 31, 2018
I. Revenue from operations 32 10,117.80 9,075.74II. Other income 33 38.12 22.60III. Total Income (I+II) 10,155.92 9,098.34IV. Expenses (i) Cost of materials consumed 34 4,910.58 4,676.24 (ii) Changes in inventories of finished goods and work-in-progress 35 20.36 (64.55) (iii) Erection and sub-contracting expenses 36 2,713.36 2,126.52 (iv) Excise duty on sale of goods - 38.35 (v) Employee benefits expense 37 629.96 562.12 (vi) Finance costs 38 284.15 195.81 (vii) Depreciation and amortisation expense 39 105.52 95.43 (viii) Other expenses 40 756.80 826.94 Total expenses 9,420.73 8,456.86V Profit before tax (III - IV) 735.19 641.48VI Tax expense 41 (i) Current tax 229.68 216.00 (ii) Deferred tax 7.82 (4.57)
237.50 211.43VII Profit for the year (V-VI) 497.69 430.05VIII Other Comprehensive Income A Items that will not be reclassified to profit or loss (i) Remeasurement of defined benefit obligations 48 (0.25) (2.54) (ii) Income tax relating to these items 41.2 0.03 0.99 B Items that will be reclassified to profit or loss (i) Exchange differences on translation of foreign joint operations 22 34.69 0.24 (ii) Net gain/(losses) on cash flow hedges 22 8.44 (6.13) (iii) Income tax relating to these items 41.2 (10.65) 1.44 Total Other Comprehensive Income 32.26 (6.00)IX Total Comprehensive Income for the year (VII + VIII) 529.95 424.05X Earnings per equity share (of ` 2 each) (i) Basic 42 19.36 16.73 (ii) Diluted 19.36 16.73
The above statement of profit and loss should be read in conjunction with the accompanying notes.
In terms of our report attached For and on behalf of the Board of Directors
For Price Waterhouse Chartered Accountants LLP H. V. GOENKAFirm Registration Number: 012754N/N500016 ChairmanChartered Accountants DIN: 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWALPartner Chief Financial Officer Managing Director & CEOMembership Number: 045255 DIN: 00026981
AMIT KUMAR GUPTA A. T. VASWANICompany Secretary Director
DIN: 00057953Place: Mumbai Place: MumbaiDate: May 08, 2019 Date: May 08, 2019
195
Company Overview Statutory Reports Financial Statements
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196
KEC International Limited Annual Report 2018-19
CASH FLOW STATEMENTfor the year ended March 31, 2019
` in Crore
ParticularsFor the year ended
March 31, 2019For the year ended
March 31, 2018
A. CASH FLOW FROM OPERATING ACTIVITIES: Profit for the year after tax 497.69 430.05 Adjustments for: Income tax expense 237.50 211.43 Depreciation and amortisation expense 105.52 95.43 Profit on sale of property, plant and equipment (net) (1.08) (0.41) Loss on property, plant and equipment discarded & intangible
assets derecognised 0.43 1.19
Gain on sale of subsidiary (9.98) - Finance costs 284.15 195.81 Interest income (18.01) (14.75) Adjustment on account of fair value of financial guarantees (2.33) (2.57) Dividend income from equity instruments in subsidiary - 1.33 Bad debts, loans and advances written off (net) 35.77 54.64 Allowance for bad and doubtful debts, loans and advances (net) 1.87 22.69 Mark to market loss on forward and commodity contracts (95.94) 9.02 Net loss arising on financial assets mandatorily measured at FVTPL (4.70) 2.25 Net unrealised exchange (gain) / loss (37.71) (7.97)
495.49 568.09 Changes in assets and liabilities 993.18 998.14 Changes in working capital: Adjustments for (increase) / decrease in operating assets: Inventories (21.33) (178.13) Trade receivables 77.37 (916.71) Loans 24.87 5.72 Other financial assets and contract assets (1,152.30) (493.77) Other current assets (262.22) (159.14) Other non-current assets 39.13 1.20
(1,294.48) (1,740.83) Adjustments for increase / (decrease) in operating liabilities: Trade payables 195.75 1,471.97 Other current liabilities and contract liabilities 581.17 279.61 Other financial liabilities 1.65 (7.03) Provisions (36.39) (15.79)
742.18 1,728.76 Cash generated from Operations 440.88 986.07 Taxes paid (net of refunds) (269.79) (211.88) Net Cash Flow Generated by Operating Activities (A) 171.09 774.19B. CASH FLOW FROM INVESTING ACTIVITIES Capital expenditure on property, plant and equipment &
intangible assets (after adjustment of increase/decrease in capital work-in-progress and advances for capital expenditure)
(88.91) (134.68)
Proceeds from sale of property, plant and equipment 4.17 1.40 Payment towards investments in subsidiaries (including share
application money)* - (195.01)
Proceeds from sale of subsidiary 57.37 - Loans given to a subsidiary* (36.27) (196.62) Loans repaid by a subsidiary including interest* 18.86 166.14 Interest received 13.30 11.36 Dividend received from a subsidiary - (1.33) Bank balances (including non-current) not considered as Cash and
cash equivalents (net) (62.48) 1.65
Net Cash Flow Used In Investing Activities (B) (93.96) (347.09)
197
Company Overview Statutory Reports Financial Statements
` in Crore
ParticularsFor the year ended
March 31, 2019For the year ended
March 31, 2018
C. CASH FLOW FROM FINANCING ACTIVITIES Proceeds from other than short-term borrowings (including
debentures) - 155.10
Repayments of other than short-term borrowings (including debentures) (34.71) -
Repayment of finance lease obligations (0.91) (3.30) Net increase / (decrease) in short-term borrowings 278.52 (315.02) Finance costs paid (289.60) (169.46) Dividend paid (61.36) (41.13) Net Cash Flow Used In Financing Activities (C) (108.06) (373.81) Net Increase / (Decrease) In Cash And Cash Equivalents
(A+B+C) (30.93) 53.29
Cash and cash equivalents at the beginning of the year (Refer Note 14) 176.31 123.02
Effect of exchange differences on restatement of foreign currency Cash and cash equivalents 1.31 -
Cash and cash equivalents at the end of the year (Refer Note 14) 146.69 176.31
* Purchase of investment is a non-cash item. (Refer note - 7.2)
Reconciliation of liabilities arising from financing activities:
` in Crore
ParticularsAs at
March 31, 2018Cash flows
Non-cash changes
As at March 31, 2019
AcquisitionForeign
exchange movement
Interest accrued
Debentures 285.39 - - - 27.80 313.19Long-term borrowings 157.99 (34.71) - - 3.88 127.16Short-term borrowings 892.56 278.52 - 27.24 0.78 1,199.10Lease liabilities (including current maturities of finance lease obligations)
0.91 (0.91) - - - -
Total liabilities from financing activities 1,336.85 242.90 - 27.24 32.46 1,639.45The above cash flow statement should be read in conjunction with the accompanying notes.
CASH FLOW STATEMENTfor the year ended March 31, 2019
In terms of our report attached For and on behalf of the Board of DirectorsFor Price Waterhouse Chartered Accountants LLP H. V. GOENKAFirm Registration Number: 012754N/N500016 ChairmanChartered Accountants DIN: 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWALPartner Chief Financial Officer Managing Director & CEOMembership Number: 045255 DIN: 00026981
AMIT KUMAR GUPTA A. T. VASWANICompany Secretary Director
DIN: 00057953
Place: Mumbai Place: MumbaiDate: May 08, 2019 Date: May 08, 2019
198
KEC International Limited Annual Report 2018-19
INDEPENDENT AUDITORS’ REPORT
To the Members of KEC International Limited
REPORT ON THE AUDIT OF THE CONSOLIDATED FINANCIAL STATEMENTS
OPINION
1. We have audited the accompanying consolidated financial statements of KEC International Limited (the Company) in which are incorporated 20 jointly controlled operations and the Return of the Company’s 39 branches at Abu Dhabi, Afghanistan, Algeria, Bangladesh, Egypt, Ethiopia, Georgia, Ghana, Guinea, Indonesia, Ivory Coast, Jordan, Kenya, Laos, Lebanon, Libya, Malaysia, Mali, Mozambique, Nepal, Nicaragua, Nigeria, Oman, Papua New Guinea, Philippines, Srilanka, Sierra Leone, Senegal, South Africa, Tanzania, Thailand, Tunisia, Uganda, Bhutan, Cameroon, Congo, Kazakhstan, Kuwait and Zambia. (hereinafter referred to as the “Holding Company”) and its subsidiaries (Holding Company and its 16 subsidiaries together referred to as “the Group”); (refer Note 3.3 and 46 to the attached consolidated financial statements), which comprise the consolidated Balance Sheet as at March 31, 2019, and the consolidated Statement of Profit and Loss (including Other Comprehensive Income) , the consolidated statement of changes in equity and the consolidated cash flows Statement for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies and other explanatory information prepared based on the relevant records (hereinafter referred to as “the Consolidated Financial Statements”).
2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidated financial statements give the information required by the Companies Act, 2013 (“the Act”) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the consolidated state of affairs of the Group as at March 31, 2019, of the consolidated total comprehensive income (comprising
of profit and other comprehensive income), consolidated changes in equity and its consolidated cash flows for the year then ended.
BASIS FOR OPINION
3. We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the consolidated financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in India in terms of the Code of Ethics issued by Institute of Chartered Accountants of India and the relevant provisions of the Act, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained and the audit evidence obtained by the other auditors in terms of their reports referred to in sub-paragraph 18 of the Other Matter paragraph below, is sufficient and appropriate to provide a basis for our opinion.
EMPHASIS OF MATTER
4. We draw attention to Note 63 of the consolidated financial statements, regarding delays in recovery of receivable amounting to ` 145 crore from a customer. The recovery of the amount is dependent upon transfer of contract from the customer to a new sponsor.
KEY AUDIT MATTERS
5. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
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Company Overview Statutory Reports Financial Statements
Key audit matter How our audit addressed the key audit matter
Estimation of contract cost and revenue recognition(Refer to note 3.8 and 35 of the Consolidated financial statements)
Contract revenue for engineering, procurement and construction contracts which usually extends over a period of 2-3 years, contract prices are fixed / subject to price variance clauses.
The contract revenue is measured based on the proportion of contract costs incurred for work performed to date relative to the estimated total contract costs, except where this would not be representative of the stage of completion.
This method requires the Company to perform an initial assessment of total estimated cost and further, reassess the total construction cost at each reporting period to determine the appropriate percentage of completion.
On transition to Indian Accounting Standard (IND AS) 115, Revenue from Contracts with Customers w.e.f. April 1, 2018, the management has performed a detailed evaluation of the implications under the new standard and has concluded that there are no material implications on account of applicability of Ind AS 115.
We considered the estimation of construction contract cost as a key audit matter given the involvement of significant management judgement which has consequential impact on revenue recognition.
Our procedures over the recognition of construction revenue included the following: • Understood and evaluated the design and tested effectiveness
of key internal financial controls, including those related to review and approval of estimated project cost and review of provision for estimated loss by the authorised representatives.
• For sample of contracts, we obtained the percentage of completion calculations, agreed key contractual terms back to signed contracts, tested the mathematical accuracy of the cost to complete calculations and re-performed the calculation of revenue recognized during the year based on the percentage of completion.
• For costs incurred to date, we tested samples to appropriate supporting documentation and performed cut off procedures
• To test the forecasted cost to complete, we obtained the breakdown of forecasted costs and tested elements of the forecast by obtaining executed purchase orders and agreements, evaluating reasonableness of management’s judgements / and assumptions using past trends and comparing the estimated costs to the actual costs incurred for the similar completed projects.
• Checked the implications and related disclosures in the financial statements pursuant to applicability of Ind AS 115.
Based on the procedures performed above, we considered manner of estimation of contract cost and recognition of revenue to be reasonable.
Key audit matter How our audit addressed the key audit matter
Valuation of accounts receivable in view of risk of credit losses (Refer to Note 50 ‘Financial Instruments’ and Note 9 and 15 ‘Trade receivables’)
Accounts receivables is a significant item in the Company’s financial statements as at March 31, 2019 and assumptions used for estimating the credit loss on receivables is an area which is influenced by management’s judgment.
The Company makes an assessment of the estimated credit losses basis credit risk, project status, past history, latest discussion/ correspondence with the customer.
Given the relative significance of these receivables to the financial statements and the nature and extent of audit procedures involved to assess the recoverability of receivables, we determined this to be a key audit matter.
Our audit incorporated the following procedures with regards to provisioning of receivables: • Understood and evaluated the accounting policy
of the company.• We evaluated the design and tested the operating
effectiveness of key controls in relation to determination of estimated credit loss.
• Inquired with senior management regarding status of collectability of the receivable.
• For material balances, the basis of provision was discussed with the audit committee.
• Assessed and challenged the information used by the Management to determine the expected credit losses by considering credit risk of the customer, cash collection, performance against historical trends and the level of credit loss charges over time;
Based on our work as stated above, no significant deviations were observed in respect of management’s assessment of valuation of accounts receivables.
Key audit matter How our audit addressed the key audit matter
Reliance on controls and processes relating to new IT system and data migration impacting financial reporting
The company migrated its transaction and financials systems from JD Edwards to SAP w.e.f. from 1 April 1, 2018.
The migration has resulted in a significant change in the company’s process and the related controls.
Data migration, is assumed to have a significant impact on the processes and controls related to the financial reporting and consequently has been considered to be an area of audit focus and accordingly determined to be a key audit matter.
We performed following procedures with respect to the new system and data migration:• Obtained understanding and tested the controls
over data migration including proper authorization, completeness and accuracy.
• Tested the migrated balances, for completeness and accuracy as of April 1, 2018.
• We evaluated the design and operating effectiveness of the IT General Controls (ITGC), business process controls post migration (both automated and manual) of the new system.
We took the above procedures into consideration in planning and executing our audit.
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KEC International Limited Annual Report 2018-19
6. The following Key Audit Matters were included in the audit report dated May 6, 2019, containing an unmodified audit opinion on the consolidated financial statements of SAE Tower Holdings, LLC, a subsidiary of the Holding Company issued by an independent firm of Chartered Accountants reproduced by us as under:
Key audit matter How our audit addressed the key audit matter
Valuation of accounts receivable in view of risk of credit losses pursuant to ongoing litigation(Refer to Note 39 - Financial risk management objectives and policies and Note 9 - Trade receivables)
The Company’s trade receivables amount to INR 182.01 crores as at 31 March 2019.
The Company has significant overdues from various customers/parties for which expected credit loss provision is measured by the management based on past trends using practical expedients as prescribed by Ind AS 109: ‘Financial instruments’. This involves significant management estimates and judgements.
The recoverable amount was estimated by management based on their specific recoverability assessment on individual debtor with reference to ageing profile, historical pattern and the past record of default of the customer. The Company makes an assessment of the credit losses basis past history and latest discussion/correspondence with the customer.
Given the relative significance of these receivables to the financial statements and the nature and extent of audit procedures involved to assess the recoverability of receivables, we determined this to be a key audit matter.
Our audit incorporated the following procedures with regards to provisioning of receivables:• We evaluated the design, implementation and operating
effectiveness of the Group’s key internal controls over the processes of collection of trade receivables; follow up of overdue balances; assessing provisions for receivables and controls relating to litigations;
• We reviewed the Company’s credit policy outlining the authority for approving and responsibility to manage credit limits.
• We tested the expected credit loss model for appropriateness of past data and provisioning matrix used and reasons for other long outstanding balances were also obtained from the management.
• We obtained an understanding of the basis of management’s judgements about the recoverability of trade receivable balances and evaluated the allowance for doubtful debts made by management for these individual balances with reference to correspondence between the Group and the debtors, the recovery plan and corroborated the inputs with our understanding of the matter and externally available information.
• We considered payments received subsequent to year-end, past payment history and unusual patterns to identify potentially impaired balances.
• We obtained confirmation from attorney to ensure recoverability of the receivable amount in case of litigations.
• We also ensured that the appropriate disclosures in accordance with Ind AS 32 have been made in the special purpose consolidated financial information.
OTHER INFORMATION
7. The Holding Company’s Board of Directors is responsible for the other information. The other information comprises the information included in the Annual Report, but does not include the consolidated financial statements and our auditor’s report thereon.
8. Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
9. In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed and the reports of the other auditors as furnished to us (Refer paragraph 18 below), we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
RESPONSIBILITIES OF MANAGEMENT AND THOSE CHARGED WITH GOVERNANCE FOR THE CONSOLIDATED FINANCIAL STATEMENTS
10. The Holding Company’s Board of Directors are responsible for the preparation and presentation of these consolidated financial statements in term of the requirements of the Act that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows, and changes in equity of the Group in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under section 133 of the Act. The respective Board of Directors of the companies included in the Group are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Group and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring accuracy and completeness
117
Company Overview Statutory Reports Financial Statements
of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the consolidated financial statements by the Directors of the Holding Company, as aforesaid.
11. In preparing the consolidated financial statements, the respective Board of Directors of the companies included in the Group are responsible for assessing the ability of the Group to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.
12. The respective Board of Directors of the companies included in the Group are responsible for overseeing the financial reporting process of the Group.
AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE CONSOLIDATED FINANCIAL STATEMENTS
13. Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.
14. As part of an audit in accordance with SAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Holding company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability of the Group to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the audit of the financial statements of such entities included in the consolidated financial statements of which we are the independent auditors. For the other entities included in the consolidated financial statements, which have been audited by other auditors, such other auditors remain responsible for the direction, supervision and performance of the audits carried out by them. We remain solely responsible for our audit opinion.
15. We communicate with those charged with governance of the Holding Company and such other entities included in the consolidated financial statements of which we are the independent auditors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
16. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
17. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
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KEC International Limited Annual Report 2018-19
OTHER MATTER
18. We did not audit the financial statements/financial information of i) 20 jointly controlled operations and 34 branches (Abu Dhabi, Afghanistan, Algeria, Bangladesh, Egypt, Ethiopia, Georgia, Ghana, Guinea, Indonesia, Ivory Coast, Jordan, Kenya, Laos, Lebanon, Libya, Malaysia, Mali, Mozambique, Nepal, Nicaragua, Nigeria, Oman, Papua New Guinea, Philippines, Srilanka, Sierra Leone, Senegal, South Africa, Tanzania, Thailand, Tunisia, Uganda and Zambia) considered in the preparation of the consolidated financial statements which constitute total assets of ` 2,646 Crore and net assets of ` 394 Crore as at March 31, 2019, total revenue of ` 2,009 Crore, and net cash flows amounting to ` 23 Crore for the year then ended; and ii) 16 subsidiaries considered in the preparation of the consolidated financial statements which constitute total assets of ` 1,108 Crore and net assets of ` 377 Crore as at March 31, 2019, total revenue of ` 967 Crore, and net cash flows amounting to ` 12 Crore for the year then ended as considered in the consolidated financial statements. These financial statements/ financial information have been audited by other auditors whose reports have been furnished to us by the Management, and our opinion on the consolidated financial statements insofar as it relates to the amounts and disclosures included in respect of these subsidiaries, jointly controlled operations and branches and our report in terms of sub-section (3) of Section 143 of the Act including report on Other Information insofar as it relates to the subsidiaries incorporated in India, jointly controlled operations and branches is based solely on the reports of the other auditors.
Our opinion on the consolidated financial statements, and our report on Other Legal and Regulatory Requirements below, is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors and the financial statements / financial information certified by the Management.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
19. As required by Section 143(3) of the Act, we report, to the extent applicable, that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit of the aforesaid consolidated financial statements.
(b) In our opinion, proper books of account as required by law maintained by the Holding Company and its subsidiary incorporated in India including relevant records relating to preparation of the aforesaid consolidated financial statements have been kept so far as it appears from our examination of those books and records of the Holding Company and the reports of the other auditors.
(c) The Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss (including other comprehensive income), Consolidated Statement of Changes in Equity and the Consolidated Cash Flow
Statement dealt with by this Report are in agreement with the relevant books of account and records maintained by the Holding Company and its subsidiary incorporated in India including relevant records for the purpose of preparation of the consolidated financial statements.
(d) In our opinion, the aforesaid consolidated financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.
(e) On the basis of the written representations received from the directors of the KEC International Limited as on March 31, 2019 taken on record by the Board of Directors of KEC International Limited and the reports of the statutory auditors of its subsidiary company incorporated in India, none of the directors of the Group are disqualified as on March 31, 2019 from being appointed as a director in terms of Section 164(2) of the Act.
(f) With respect to the adequacy of internal financial controls with reference to financial statements of the Holding Company and its subsidiary company incorporated in India and the operating effectiveness of such controls, refer to our separate report in Annexure A.
(g) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditor’s) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The consolidated financial statements disclose the impact, if any, of pending litigations as at March 31, 2019 on the consolidated financial position of the Group – Refer Note 54 to the consolidated financial statements.
ii. Provision has been made in the consolidated financial statements, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts as at March 31, 2019 – Refer Note 20(a) and 33 to the consolidated financial statements in respect of such items as it relates to the Group.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Holding Company and its subsidiary company incorporated in India during the year ended March 31, 2019.
iv. The reporting on disclosures relating to Specified Bank Notes is not applicable to the Group for the year ended March 31, 2019.
For Price Waterhouse Chartered Accountants LLP Firm Registration Number: 012754N/N500016
Chartered Accountants
Sarah George Place: Mumbai PartnerDate: May 08, 2019 Membership Number 045255
119
Company Overview Statutory Reports Financial Statements
REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) OF SUB-SECTION 3 OF SECTION 143 OF THE ACT
1. In conjunction with our audit of the consolidated financial statements of the Company as of and for the year ended March 31, 2019, we have audited the internal financial controls with reference to financial statements of KEC International Limited including 39 branches (hereinafter referred to as “the Holding Company”) and its 1 subsidiary company, which are companies incorporated in India, as of that date.
MANAGEMENT’S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
2. The respective Board of Directors of the Holding company, and its subsidiary company, to whom reporting under clause (i) of sub section 3 of Section 143 of the Act in respect of the adequacy of the internal financial controls over financial reporting is applicable, which are companies incorporated in India, are responsible for establishing and maintaining internal financial controls based on internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the respective company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
AUDITOR’S RESPONSIBILITY
3. Our responsibility is to express an opinion on the Company’s internal financial controls with reference to financial statements based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the ICAI and the Standards on Auditing deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to financial statements was established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial
controls system with reference to financial statements and their operating effectiveness. Our audit of internal financial controls with reference to financial statements included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained and the audit evidence obtained by the other auditors in terms of their reports referred to in the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system over financial reporting.
MEANING OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO FINANCIAL STATEMENTS
6. A company’s internal financial control with reference to financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control with reference to financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO FINANCIAL STATEMENTS
7. Because of the inherent limitations of internal financial controls with reference to financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to financial statements to future periods are subject to the risk that the internal financial control with reference to financial statements may become inadequate because of changes in
ANNEXURE A TO INDEPENDENT AUDITORS’ REPORTReferred to in paragraph 19(f) of the Independent Auditors’ Report of even date to the members of KEC International Limited on the consolidated financial statements for the year ended March 31, 2019
120
KEC International Limited Annual Report 2018-19
conditions, or that the degree of compliance with the policies or procedures may deteriorate.
OPINION
8. In our opinion, the Holding Company and its 1 subsidiary company, which are companies incorporated in India, have, in all material respects, an adequate internal financial controls system with reference to financial statements and such internal financial controls with reference to financial statements were operating effectively as at March 31, 2019, based on the internal control with reference to financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
OTHER MATTER
9. Our aforesaid reports under Section 143(3)(i) of the Act on the adequacy and operating effectiveness of the internal financial controls with reference to financial statements insofar as it relates to 1 subsidiary company, which is a Company incorporated in India, and 34 branches, is based on the corresponding reports of the auditors of such company incorporated in India and the report of the auditors of such branches. Our opinion is not qualified in respect of this matter.
For Price Waterhouse Chartered Accountants LLP Firm Registration Number: 012754N/N500016
Chartered Accountants
Sarah George Place: Mumbai PartnerDate: May 08, 2019 Membership Number 045255
121
Company Overview Statutory Reports Financial Statements
CONSOLIDATED BALANCE SHEET as at March 31, 2019
` in Crore
Particulars Note No.As at
March 31, 2019As at
March 31, 2018ASSETS(1) Non-current Assets
(a) Property, plant and equipment. 5 866.56 828.76 (b) Capital work-in-progress 7.32 78.07 (c) Goodwill 6 203.71 191.98 (d) Intangible assets 7 112.12 91.46
1,189.71 1,190.27 (e) Financial assets
(i) Investments 8 * *(ii) Trade receivables 9 - 5.47 (iii) Other financial assets 10 13.58 205.54
13.58 211.01 (f) Deferred tax assets (net) 28 31.32 26.50 (g) Non-current tax assets (net) 11 119.68 45.15 (h) Other non-current assets 12 189.08 227.22
Total Non-Current Assets 1,543.37 1,700.15 (2) Current assets
(a) Inventories 13 641.01 627.41 (b) Financial assets
(i) Investments 14 13.21 39.29 (ii) Trade receivables 15 4,875.26 5,038.93 (iii) Cash and cash equivalents 16 175.23 193.00 (iv) Bank balances other than (iii) above 17 100.94 38.31 (v) Loans 18 33.57 60.44 (vi) Other financial assets 19 105.73 2,135.73
5,303.94 7,505.70 (c) Contract Assets 20 (a) 3,331.26 - (d) Current tax assets (net) 21 13.62 99.62 (e) Other current assets 22 861.25 606.11
Total Current Assets 10,151.08 8,838.84 Total Assets 11,694.45 10,538.99
EQUITY AND LIABILITIESEquity
(a) Equity share capital 23 51.42 51.42 (b) Other equity 24 2,383.68 1,946.04
- Equity attributable to owners of the Company 2,435.10 1,997.46 (c) Non-controlling interests 25 - *Total Equity 2,435.10 1,997.46
Liabilities(1) Non-current liabilities
(a) Financial liabilities- Borrowings 26 541.06 738.44
(b) Provisions 27 13.92 17.68 (c) Deferred tax liabilities (net) 28 149.65 127.20
Total Non-Current Liabilities 704.63 883.32 (2) Current liabilities
(a) Financial liabilities(i) Borrowings 29 1,155.75 900.97 (ii) Trade payables
- total outstanding dues of micro and small enterprises 30 71.19 -- total outstanding dues other than micro and small enterprises 30 4,729.75 4,657.84
(iii) Other financial liabilities 31 159.34 170.18 6,116.03 5,728.99
(b) Contract liabilities 20 (b) 2,252.19 - (c) Other current liabilities 32 100.35 1,746.25 (d) Provisions 33 50.33 83.24 (e) Current tax liabilities (net) 34 35.82 99.73
Total Current Liabilities 8,554.72 7,658.21 Total Equity and Liabilities 11,694.45 10,538.99
* less than rounding off norms adopted by the Company.The above Consolidated Balance Sheet should be read in conjunction with the accompanying notes.
In terms of our report attached For and on behalf of the Board of Directors
For Price Waterhouse Chartered Accountants LLP H. V. GOENKAFirm Registration Number: 012754N/N500016 ChairmanChartered Accountants DIN: 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWAL Partner Chief Financial Officer Managing Director & CEO Membership Number: 045255 DIN: 00026981
AMIT KUMAR GUPTA A. T. VASWANICompany Secretary Director
DIN: 00057953Place: Mumbai Place: MumbaiDate: May 08, 2019 Date: May 08, 2019
122
KEC International Limited Annual Report 2018-19
The above Consolidated statement of profit and loss should be read in conjunction with the accompanying notes.
In terms of our report attached For and on behalf of the Board of Directors
For Price Waterhouse Chartered Accountants LLP H. V. GOENKAFirm Registration Number: 012754N/N500016 ChairmanChartered Accountants DIN: 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWAL Partner Chief Financial Officer Managing Director & CEO Membership Number: 045255 DIN: 00026981
AMIT KUMAR GUPTA A. T. VASWANICompany Secretary Director
DIN: 00057953Place: Mumbai Place: MumbaiDate: May 08, 2019 Date: May 08, 2019
CONSOLIDATED STATEMENT OF PROFIT AND LOSSfor the year ended March 31, 2019
` in Crore
Particulars Note No.For the year ended
March 31, 2019For the year ended
March 31, 2018Continuing operationsI Revenue from operations 35 11,000.53 10,090.98 II Other income 36 22.59 20.70 III Total Income (I+II) 11,023.12 10,111.68 IV Expenses
(i) Cost of materials consumed 37 5,344.45 5,245.30 (ii) Changes in inventories of finished goods and work-in-progress 38 65.23 (104.86)(iii) Erection and sub-contracting expenses 39 2,713.36 2,126.52 (iv) Excise duty on sale of goods - 38.35 (v) Employee benefit expenses 40 832.19 798.35 (vi) Finance costs 41 311.86 229.37 (vii) Depreciation and amortisation expense 42 117.13 109.74 (viii) Other expenses 43 895.39 981.61
Total expenses 10,279.61 9,424.38 V Profit before tax from continuing operations (III - IV) 743.51 687.30 VI Tax expense: 44
(i) Current tax 251.93 249.30 (ii) Deferred tax 5.14 (20.29)
257.07 229.01 VII Profit for the year from continuing operations (V-VI) 486.44 458.29 VIII Discontinued Operations 48
Profit from discontinued operations 13.43 2.94 Tax expense of discontinued operations 4.10 0.81
IX Profit from discontinued operations 9.33 2.13 X Profit for the year (VII + IX) 495.77 460.42 XI Other Comprehensive Income
A Items that will not be reclassified to profit or loss(i) Remeasurement of defined benefit obligations 52 0.57 (2.02)(ii) Income tax relating to items that will not be reclassified to profit or loss 44.2 (0.22) 0.83
B Items that will be reclassified to profit or loss(i) Exchange differences on translation of joint operations and subsidiaries 24 17.66 (2.28)(ii) Net gain/(losses) on cash flow hedges 24 8.44 (6.13)(iii) Income tax relating to items that will be reclassified to profit or loss 44.2 (10.65) 1.44
Total Other Comprehensive Income 15.80 (8.16)XII Total Comprehensive Income for the year (X+XI) 511.57 452.26
Profit for the year attributable to:Owners of the Company 511.57 452.26 Non-controlling interests 25 * * Other Comprehensive Income attributable to:Owners of the Company 15.80 (8.16)Non-controlling interests * * Total Other Comprehensive Income attributable to:Owners of the Company 511.57 452.26 Non-controlling interests * *
XIII Earnings per equity share for continuing operations (of ` 2 each)(i) Basic 45 18.92 17.83 (ii) Diluted 18.92 17.83
XIV Earnings per equity share for discontinued operation (of ` 2 each)(i) Basic 45 0.36 0.08 (ii) Diluted 0.36 0.08
XV Earnings per equity share (for continuing and discontinued operations) (of ` 2 each)(i) Basic 45 19.28 17.91 (ii) Diluted 19.28 17.91
* less than rounding off norms adopted by the Company.
123
Company Overview Statutory Reports Financial Statements
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended March 31, 2019
A.
EQ
UIT
Y S
HA
RE
CA
PIT
AL
` in
Cro
reP
arti
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sA
mo
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Bal
ance
as
at A
pril
01,
201
8 5
1.42
C
hang
es in
eq
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sha
re c
apita
l dur
ing
the
year
23 -
B
alan
ce a
s at
Mar
ch 3
1, 2
019
51.
42
B.
OT
HE
R E
QU
ITY
`
in C
rore
Par
ticu
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Oth
er
item
s (S
hare
is
sue
exp
ense
s)
Res
erve
s an
d S
urp
lus
Oth
er C
om
pre
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ive
Inco
me
Tota
lC
apit
al
Res
erve
Cap
ital
R
eser
ve o
n co
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lidat
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Sec
urit
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Pre
miu
m
Cap
ital
R
edem
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on
Res
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Deb
entu
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Red
emp
tio
n R
eser
ve
Sta
tuto
ry
Res
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Gen
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R
eser
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E
arni
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Eff
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po
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f H
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Exc
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s o
n tr
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f fo
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Oth
er it
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of
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(Rem
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(0.3
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4.98
0
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86.
75
14.
28
6.7
9 0
.95
152
.98
1,1
80.8
8 1
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10.
37
(4.2
3) 1
,534
.95
Pro
fit fo
r th
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ar -
-
-
-
-
-
-
-
4
60.4
2 -
-
-
4
60.4
2
Oth
er C
ompr
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Inco
me
for
the
year
-
-
-
-
-
-
-
-
-
(3
.95)
(3.0
2) (1
.19)
(8.1
6)
Tota
l Com
preh
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com
e fo
r th
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ar -
-
-
-
-
-
-
-
4
60.4
2 (3
.95)
(3.0
2) (1
.19)
452
.26
Tran
sact
ions
wit
h o
wne
rs in
the
ir
cap
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ow
ner
Div
iden
ds -
-
-
-
-
-
-
-
(4
9.51
) -
-
-
(4
9.51
)
Div
iden
d di
strib
utio
n ta
x -
-
-
-
-
-
-
-
8
.37
-
-
-
8.3
7
Tran
sfer
from
reta
ined
ear
ning
s -
-
-
-
-
1
5.98
-
-
(1
5.98
) -
-
-
-
Tr
ansf
erre
d to
oth
er it
ems
due
to c
hang
es
in in
com
e ta
x ra
te (0
.03)
-
-
-
-
-
-
-
-
-
-
-
(0.0
3)
Bal
ance
as
at M
arch
31,
201
8 (0
.33)
84.
98
0.0
4 8
6.75
1
4.28
2
2.77
0
.95
152
.98
1,5
84.1
8 (2
.49)
7.3
5 (5
.42)
1,9
46.0
4
Bal
ance
as
at A
pri
l 01,
201
8 (0
.33)
84.
98
0.0
4 8
6.75
1
4.28
2
2.77
0
.95
152
.98
1,5
84.1
8 (2
.49)
7.3
5 (5
.42)
1,9
46.0
4
Pro
fit fo
r th
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ar -
-
-
-
-
-
-
4
95.7
7 -
-
-
4
95.7
7
Oth
er C
ompr
ehen
sive
Inco
me
for
the
year
-
-
-
-
-
-
-
-
5.4
5 1
0.00
0
.35
15.
80
Tota
l Com
preh
ensi
ve In
com
e fo
r th
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ar -
-
-
-
-
-
-
-
4
95.7
7 5
.45
10.
00
0.3
5 5
11.5
7 Tr
ansa
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ns w
ith
ow
ners
in t
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ca
pac
ity
as o
wne
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ivid
ends
(61.
70)
(61.
70)
Div
iden
d di
strib
utio
n ta
x (1
2.56
) (1
2.56
)
Tran
sfer
from
reta
ined
ear
ning
s -
-
-
-
1
5.98
-
(1
5.98
) -
-
-
-
Tran
sfer
red
on d
ispo
sal o
f sub
sid
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0.3
3 0
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Bal
ance
as
at M
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31,
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9 -
8
4.98
0
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86.
75
14.
28
38.
75
0.9
5 1
52.9
8 1
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2.9
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(5
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83.6
8
The
ab
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Co
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tate
men
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f ch
ang
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uity
sho
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be
read
in c
onj
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wit
h th
e ac
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no
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In t
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s of
our
rep
ort
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Fo
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n b
ehal
f of t
he B
oard
of D
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For
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: 012
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Num
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DIN
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1
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: Mum
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019
124
KEC International Limited Annual Report 2018-19
CONSOLIDATED CASH FLOW STATEMENTfor the year ended March 31, 2019
` in Crore
ParticularsFor the year ended
March 31, 2019For the year ended
March 31, 2018
A. CASH FLOW FROM OPERATING ACTIVITIES:Profit after income tax fromContinuing operations 486.44 458.29 Discontinued operations 9.33 2.13
Profit for the year after tax 495.77 460.42 Adjustments for:Income tax expense 261.17 229.82 Depreciation and amortisation expense 117.13 109.74 Profit on sale of property, plant and equipment (net) (1.08) (0.79)Loss on property, plant and equipment discarded & intangible assets derecognised 0.59 1.19
Gain on sale of subsidiary (7.25) - Finance costs 311.86 246.61 Interest income (14.80) (35.48)Bad debts, loans and advances written-off (net) 35.78 66.04 Allowance for bad and doubtful debts, loans and advances (net) 1.87 37.28 Mark to market loss on forward and commodity contracts (96.53) 9.15 Net loss arising on financial assets mandatorily measured at FVTPL 1.84 - Net unrealised exchange (gain)/loss (31.23) (1.03)
579.35 662.53 Changes in assets and liabilities 1,075.12 1,122.95 Changes in working capital:Adjustments for (increase)/decrease in operating assets:Inventories (13.60) (232.75)Trade receivables (80.50) (895.34)Loans 26.92 2.82 Other financial assets & contract assets (1,008.56) (568.43)Other current assets (254.62) (172.87)Other non-current assets 39.16 (18.40)
(1,291.20) (1,884.97)Adjustments for increase/(decrease) in operating liabilities:Trade payables 165.27 1,481.06 Other current liabilities & contract liabilities 597.82 193.98 Other financial liabilities (14.26) (7.15)Provisions (36.33) (16.69)
712.50 1,651.20 Cash generated from operations 496.42 889.18 Taxes paid (net of refunds) (297.68) (229.56)NET CASH FLOW GENERATED BY OPERATING ACTIVITIES (A) 198.74 659.62
125
Company Overview Statutory Reports Financial Statements
` in Crore
ParticularsFor the year ended
March 31, 2019For the year ended
March 31, 2018B. CASH FLOW FROM INVESTING ACTIVITIES
Capital expenditure on property, plant and equipment & intangible assets (after adjustment of increase/decrease in capital work-in-progress and advances for capital expenditure)
(113.44) (137.40)
Proceeds from sale of property, plant and equipment 5.16 1.88 Purchase of short-term investments (595.43) (520.49)Proceeds from disposal of short-term investment 621.52 611.59 Proceeds from sale of subsidiary 57.37 - Interest received 14.77 35.55 Bank balances (including non-current) not considered as Cash and cash equivalents (net)
(59.40) 4.41
NET CASH FLOW USED IN INVESTING ACTIVITIES (B) (69.45) (4.46)C. CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from other than short-term borrowings (including debentures) 62.64 195.13 Repayments of other than short-term borrowings (including debentures) (103.56) (220.25)Repayment of finance lease obligations (5.69) (11.08)Net increase/(decrease) in short-term borrowings 274.80 (340.31)Finance costs paid (316.74) (220.51)Dividend paid (61.36) (41.13)NET CASH FLOW USED IN FINANCING ACTIVITIES (C) (149.91) (638.15)NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS (A+B+C)
(20.62) 17.01
Cash and cash equivalents at the beginning of the year (Refer Note 16) 193.00 175.53 Effect of exchange differences on restatement of foreign currency Cash and cash equivalents
2.85 0.46
Cash and cash equivalents at the end of the year (Refer Note 16) 175.23 193.00
Reconciliation of liabilities arising from financing activities:
` in Crore
ParticularsAs at March
31, 2018Cash flows
Non-cash changes As at March 31,
2019Disposal of subsidiary
Foreign exchange
movement
Interest accrued
Debentures 285.39 - - - 27.80 313.19 Long-term borrowings including current maturities of long-term debts (other than debentures and lease liabilities)
572.37 (40.92) (167.58) 4.72 4.84 373.43
Short-term borrowings 900.98 274.80 - (20.03) 0.78 1,156.53 Lease liabilities (including current maturities of finance lease obligations)
10.89 (5.69) - - - 5.20
Total liabilities from financing activities 1,769.63 228.19 (167.58) (15.31) 33.42 1,848.35
The above Consolidated Cash Flow Statement should be read in conjunction with the accompanying notes.In terms of our report attached For and on behalf of the Board of Directors
For Price Waterhouse Chartered Accountants LLP H. V. GOENKAFirm Registration Number: 012754N/N500016 ChairmanChartered Accountants DIN: 00026726
SARAH GEORGE RAJEEV AGGARWAL VIMAL KEJRIWAL Partner Chief Financial Officer Managing Director & CEO Membership Number: 045255 DIN: 00026981
AMIT KUMAR GUPTA A. T. VASWANICompany Secretary Director
DIN: 00057953Place: Mumbai Place: MumbaiDate: May 08, 2019 Date: May 08, 2019
CONSOLIDATED CASH FLOW STATEMENTfor the year ended March 31, 2019
126
KEC International Limited Annual Report 2018-19
K~C
November 08, 2019
National Stock Exchange of India Limited
Exchange Plaza I Sandra Kurla Complex Bandra (East), Mumbai 40 051
Symbol: KEC
Dear Sir/ Madam,
BSE Limited
I<EC I NTERNATIONAL LTD. RPG House 463, Or. Ann1e Besant P.oed Worll, Mumbal 400030, India +91 22 66670200 www.kecrpg.com
Phiroze Jeejeebhoy Towers Dalal Street, Fort Mumbal - 400 001
Script Code: Equity- 532714 955184,955189 & 955190
' Ref: Regulation 30 of S~BI (Listing Obligations and Disclosures Requirements) Regulations, 2015
Sub: Outcome of Board\ Meeting of the Company held on November 08. 2019
In terms of Regulation 3d of the Securities and Exchange Board of India (listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"), we wish to inform that the Board of Directors of
f the Company at its meeting held today i.e. on Friday, November 08, 2019, Inter alia, considered and unanimously approved:
1. The Unaudited Stand lone and Consolidated Financial Results of the Company for the quarter and half year ended Septembe 30, 2019 along with the Limited Review Report of the Statutory Auditors thereon, and the same are end sed herewith in terms of Regulation 33 and 52 of the SEBI Listing Regulations.
2. The appointment of M . M.S. Unnikrishnan (DIN: 01460245) as an Additional and Independent Director of the Company for a pe~od of 5 (five) years with effect from November 08, 20191 subject to approval of the shareholders of the Cor pany at the General Meeting of the Company. A brief Profile and other information of Mr. Unnikrlshnan is r closed herewith as "Annexure A~
The Board meeting <::ommenced at 11:00 a.m. and concluded at .8 · Y S: p.m.
Kindly take the same on re
1
ords. 'tJ Thanking you, I _,--Yours faithfully, For KEC International L mited
~v~O Rajeev Aggarwal Chief Financial Officer
Encl: as above
Registered OffiC11: RPG House, 4163, Annle Besant Road Woril, Mumbal400030. CJN· L452@ 5Pl.C15206t, lndla.
An H PG Company
Sr. Particulars No.
1. Reason for chang~±z. appointment, reslg ation, removal, death or otherwise;
2.. Date of appofntme~t (subject to approval at AGM
3. Term of appointme6t
4. Dlsdosure of relati~ships between directors ( n case of appointment of a ditector)
5. Affirmation
I 6. Brief profile (In case of
appointment)
I~C
Mr. M. S. Unnikrishnan (DIN: 01460245)
Appointment as Additional (Independent) Director
November 08, 2019
November 08, 2019 to November 07, 2024
"Annexure-A"
Mr. M.S. Unnikrishnan is not related to any other director or Key Managerial Personnel of the Company.
Based on the Information available with the Company, Mr. M S Unnlkrlshnan is not debarred from holding the office of a director by virtue of any SEBI order or any other such authority.
Mr. Unnikrlshnan began his career with Thermax after graduating in Mechanical engineering from VNIT, Nagpur In 1982. He fs also a graduate In Advanced Management Programme from the Harvard Business School, USA. Under Mr. Unnikrishnan's leadership, Thermax grew to be a billion-dollar company In 2010-11. Mr. Unnikrishnan chairs the CII National Committee of Industrial Relations. He has chaired the capital Goods Skill Council Committee under the National Skill Development Corporation. He also chaired the Skills Working Group of BRICS Business Coundl in 2016. He is a member of the Development Council constituted by the Ministry of Heavy Industries, Government of India, to create strategies for the industrial development of the country. Mr. Unnikrishnan is actively involved in initiatives for the Improvement of technical education in India. He is a member of the AICTE Jury Committee for annual ranking of technical and management institutes of the Country. He Co-Chairs the Apex Council to implement the 'Prime Minister's Fellowship Scheme for Doctoral Research', a joint initiative from the government and Industry to encourage industrial research and nurture talent.
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21 Page
KEC International Limited CIN No. -I.AS200MH200SPLC152061
Re!ld Office. RPG House. 463. Or AMte Oesant Road. Wodt. Mumbm- 400 Olll
St•t<mtnt of Consolidated un .. dited Fioaneial Results Cortbe ( Ulrltr •"" lbUYoar taded~ temb"'r 3tl.101f o .......... d..t Rotrw
Parti<ulars September 30, JuauO, ~..,.btr30, Sept-btr 30,
2019 2019 1018 1019 (Unaudited) (llnaudlted) (lJaudited) (l.lnaudiltd}
I Revenue fro In opera lions 1808.81 2~12.45 140M$ $111.26 1 Other Income 3.59 1.7J 1.71 6.31 3 Tot• I Income (1+2) 2812.40 l41S.J8 HIO.I6 5U1.SS 4 Expenses
(I) Cut of mllerlats consumed 1444.05 US4.90 1231.&5 1S9US (II) Chane"" in Inventories offlnished eoods, work-In-progress (53.73) (39.16) (15.56) (9Uf)
(Iii) Ert<lion & •ub-oontra<tiag ttp«nsts SSJ.U 571.69 509.46 1115.53 (lv) F.mployu bfno.fits .. ptnse 114.65 lll..66 106.1J 496.31 (v) t'"ifaance msts 81.16 19..53 76.11 161.69 (vi) Otprc<lation and amonbatlon expenu 34.74 J6.01 3tl.Jt 71.JS
(vii) Oilier upens6 196.19 1SL04 131.70 541.23 Totolup<aus 263!.90 1177.27 ll62A 4f09.17
5 Proflt before tu (~) 110.50 IJ7.9J 147.6& lilA I
6 Tax upenses: (1) Current Til~ 11.31 67.73 56.58 139.10 (II) OeftrredTu (19.99) (18.43 (S.lJ) (~1.;11)
'l'otul Tat Expense 41.38 ~9.30 51.35 90.68 1 Proflt Cor the period from continulne operollon.! (5·6) 139.11 81.61 96.Jl a11.1J
8 Discontinued ove(a tlons (I) Profit from dlO<ontinued operations before tox . - 1.05 -(II) Tax expense of dis.eontiaued operations . - O.S7 -Pro lit from diS<onlinutd operations (1·11) - - 1 ... -
9 Profit for the p•rlod: (7+8) 139.11 ..... 91.11 117.7J
10 Otbtr Comprehtasivt Ia eo me for tho period (I) lltnll tbat will not be rerluslned to pront or loss 0.14 0.14 (1.01) O.ll (II) lneometu relaline to items th.at wUI not b• rt<luaJntd (0.61) (OM) 0.33 (11.71)
to pront or loss (Ill) Items !hot wUI bt rtdossltied to pront or loss 10.49 (6 .• 76) lUI 3.7J (lv) lncome tu rtllllne to Items tbu will be reclaulfiecl to (0.89) U9 (l.al) 1.70
wont or lu~s
II Totti Other Compr<heoslvelncome Cor tho period 9.01 (4.07) l?-40 S.liO 12 To ti l Comprehensive 'Income Cor lite period (li'll l) 148.19 84.S~ llS.ll :UL73
13 Pald·up oquily share eepltal (face value Rs. 11• toth) 51.41 51.41 SIA~ SIAl 14 Other £qul1y 15 Dulc/ Olluted Earnin&s Ptr Share (In Ruptu) from continuing operation 5.41 J.~s 3.75 a.u
attrlbullble to owners (f•e• .. sue Rx. 1/· each) (not annualbtd)
16 Bule I Diluted Earnings Per Shore (in Rupeu) from dls~onllnued - . 1.06 -operation attrlbuubleto owners (Care value Rx. 2/- u<h) (not annuallsed)
17 8ulc I Diluted Earninp Per Share (in Rupeu) from continuing and 5.41 ),~$ 3.11 '"' diJContlnued operation ourlbutobloto o-.n.,. (Cece •olue Rs. 21· tach) (not unnuollre<Jl
$n lffOmpaoylq notn ronnla1 par1 of the ttiOJOitdated Raaoclal rftllhl
IU. ia Crtre
.. ...~ .... Vurnd..t Septtmbtr 30, Mardl31,
lOJIJ lOIJ (Uuodited) (Audited)
4512.73 11000.53 11.69 ll.S9
4~2 11013.11
1190.17 5344.45
18.30 65.13 lOlJAS 1713.36 411J.l0 131.19 141.59 311.16 6IJ.lJ 117.13
390.98 S95.J9 4US.IIS 10179.61
l$0.37 743.51
IOS.74 25Ul (7.01 $.1. 98.73 157.07
III.U 486.44
4.15 13.4l 1.15 4.10 3.110 J.JJ
18~.64 495.77
(1.02) 0.57 OM (0.22
34.1)4 16.10 (S.73) (10.65)
lUS I SAO 111.59 511.57
Sl,4l 51.41 lliU8
1.01 11.91
O.Jl 0.36
7.19 lt.ll
~(; Internationa l Limited Stot~ment ofCon!olidutd Assets and Lioblllllcs u at September JO 2019
ASSETS 1\oo>-Curr~nt AJStiJ
(1) Proputy, Planttnd Equlpm~nt
(b) Ctpltol work·in·proar m
(c) Rl&~t-of·use Assot (d) Goodwill
(e) lntlncJblt Assets (f) Flnon<ial ASJCU
llllnvestmcnt.J (II) Loons (Ill) Othtr nnon<iol assets
(&) Deferred Tu Ass<tJ (Net) (b) Non-Currtnt Tu AU<lf (Net)
(i) Othtr Non-Current useu Toto! Non-Current Asseu
2 Current Assets (a) Inventories
I
1
(b) Flnonrlal Assets (I) lnvestmcntl
(II) Trode recelv$blu (ill) Cuh Mod cuh ~qulv•l•nts (lv) Bank balance. other than (ill) obove
(v) Loans
(vi) Other nnonrlal U$tlf
(c) Contract Auets
(d) Curr••• Tu Alsell (Net) (e) Otbu currtat usets
Toto! Currenc Aosels
·rocal i\sseta
£QUrrv AND WA81Lm£S l>qulty (o) Equity Share raphal
(b) Other Equity Toto! equity
U1billtlu
Nan-Current llohlllch•• (a l Jlinondal U•blllllr1
(I) Bu rrowing~
(II) l,u~o llobllhltt
(II) Pruvl!lonw
(t) O•ferrtd tu ll~blllclrJ (Nee)
TotAl Non•CIIrr~utlhoblilciCll
Current liablllllcs
(a) ll!nantial Liabilities
(I) Borrowlnas (ill Lcut llablllclu
(Ill) 'l'rode pay1ble. - ·rota! oul!lundlna dues of mlno ond an1all entorprbu
-Toto I outst•ndlna dues of creditors other titan mltro ood amall encuprlsn
(lv) Otbtr nnan<lolllabllhln
(b) Contrott Uobllltlu (c) Otbr currtnclioblllclu
(d) Pro•islons (t) Currtnt Tu Liabilities (Net) Total cwrrtntllobllitia
Total F.quicy and Uobllitia
• Amo""''' below the round Ina orr norms adopted by the Compuy.
1~tl~ \
As at
September 30, 2019
(Un~udited)
869.03 8.18
1a.n 208.78
100.82
10.66 :us
49.26 156.54
239.70
700.5~
5,1 18,00 278.02
t0.o7
61.75
38.41
3,J6Ul 11.99
985.83 10,310.43
ll,J0-!.47
SI.H
2,s32.94 2,584.36
205.98
54.54 13.79
IJ8.~S
39l.96
l,ll1.76 16.03
119.57 4,0Sl. ll
427.10
1.1.9•.17
7J.67
so.n ~5.96
9,127.15 !1.104.47
Rs.lnCrore
Asll Mud!31,
2019 (Audittd)
866.S6
1.32
203.71
lll.ll
8.82 4.76
31.32
119.68 189.08
1,543.37
641.01
13.21 4,875.16
175.23 100.94
33.57 105.73
J,J,H.l6
13.61
861.25 10,151.08
11,69~.4$
SIAl 2,38J.68
1,435.10
54 1.06
-13.91
149.65 ?OUJ
1,155.7~
-71.19
4,719.75
159.34
1,151.19
100.35
50.33 l$.31
8,554.72 11,694.45
KEC International Limited Consolidated Cub Flow Statement for the Half yttr ended September 30 1019 . Rs.ln Crore Particulars Fer dw H.alt )'tar t:nckd For the Jlall1tar<ndtd
Stptcmber 30,20IP Scpt.embn 30,1018 A. CAS II FLOW FROM OPERA TINC ACTIV1Tf£S:
Profit anu income IIX from Cuciauln&Opttatiom: 217.1) 181M Ob<onciA...t opcratieM 3.00
PROFIT FOR TtU: YEAR AF'T£R TA.X ll'I.7J IS..64 Adjugmcnts ftn
Income tu e_,~ """ 9U8
Dtp.rtci&ttoa and a1110rtlndoa tlPft'Jot 71.JS 60.2J
Profit en ult of propc~. plaor and cq..;p...r (ott) O.Jl Lou on ptopetty. plaot and cquipmtnr diktrdtd & intan&.)ble UStU ckrtcoe;nised o.oa -F"t.n.a.nce cou• 161.49 ISOJl
lnl:t-,-tfl ln~I'M (J.I6) {ll.ll}
Bad dtbCJ.ltam. and Jd\'IIKtt writ1C'D orr (M:t) JUJ 19.46
Allowan<e for bad and doubtful debu,loaOJ and ad•anm (Mil '·" l,ll Mlfk co mlrktC 10)1 on forward and commodrcycontratiJ 6l,U OA' Nd unrtt Ukd ~nhan&c Ktia (16A0) (103.19)
410.13 l06.1G Cllen&t>ln .... u ond liablllrla 637.86 390.80 Chapen jo wprkinc caailal;.
Adjut.tmrnu: for (lntrr:aJC!) I dtcrtut In opnadnc a.I.Jtlit
Jnvcntofi.tJ (59.SJ) (96,77)
Trade ro<dvobl<l (UO.OS) (49.60)
LoaM (15.46) (6.11)
Other fin.,.cbiiUttslt contnct aueu: 145,08 (SO.S!}
OH\u C'Urttnc antCJ (154.17) (173.17)
Olbc.r I)On·c_urtcnl. autlii (49.Jl) (15.93)
(36.1.85) (492.l6)
Adj\.1-JimLAIJ for incrHH I (dnrtue) iGtpottlliAtlitbilititt: Tra~ payal>IH (644.11) (1.15i.l6)
Or her currtftl Uablllrltf & ronrnrtltoblllriH (4UI) l6t.74)
Orbtr ltoaodal btbWti .. 1.$<1 U7
Provbl•• lJ4 (ll-~7)
(6SS.ll ) (l.l$7.90) CASU G£.NI!RATED FROM OPERATIONS (~11.2 1) (1.359.36) Tu .. paod (ott of refvndf) (IS4.97) (161.14 N£'1' CASII f LOW USED IN OPERA TINC ACTIVlTits (A) (S?6.1S) (I.Sl0.$0)
11. CASR Jll.OW FROM INV£S11NC At'"l'I Vm&S C:apirJitxpcndir•rt •• propcfly, planr ond tqiiOJ>menlll lftll~&lblt trl(n Ctfttr adjvtl,.,t orlr~cru..td«rtuo in aopllolwtrll·••· proe.rtn tnd ad~•nttt lor up;c•l '-'JH"nditu,..)
(~5.,1 (51.81)
Proued• (rom .... or propt-'1)'. plur and tqt~lpm .. r 0.04 3.19
Prtucdw fra,_ dispe111 tfthel1 tf!f'M JnvHtMtftt lUI )7.)8
hntrttl '«th•td J.n ll.lf
Ptnlt b•linru Hncludil11 noi\•('Utrcnt) not tOMii:J.trtd •• Ca•h artd c.ul\ tquiv•ltnu (llel) 90.U (6J.71)
N£1' CAS II FLOW GENI\ll&Tt:O BY/ USt:D .IN INVESTINO ACTIVJTJtl:S (R) Sl.36 (59.711
C. CASI:f FLOW FROM fiNf\NC INO ACTIVITIES Pfotttlb fr'OIIl othtr ch•n lltOr'HeNn borl'uwfnlll (lnthadina dcbtn,urcs) UU5 t51,9t
RtpAynUtnls or o1ht,. thul , ,.on·•trnt bOI"fltwfn~ (106.53) (IJO.JI)
ll(J>ayonent or, .... oblla•rlon. (l0J1) (o.91)
lntrttse in tho•1~rtrn' borrowlnt:' (fttl) 9~8. 13 1711.50
Vlnan<ci'Otttpald (144.43) (130.36)
Olwldtnd pold (69.01) <'o.91) Nt:T CASU FLOW CF.NERA'I'eD BY flNANCINC ACTIVIT IES (C) 648.11 1,551.91 NET t NCkF.AS& I (O£CJU:ASE) IN CASU AND CASJI F.QUIVAU:NTS (A+B+c) 103.30 (18.30) c .. h ••d <uhrqolul<n" ltlh•bcalnnlna ., .... , ... 175.23 192.93 Bff«l tf e.wtha~ dlfftr,nctl oo rt:tt.attnwnt e(fortia" ''"'tntJ Ctth and ujh tqulnltau (0.51) •• 4$ Mo,..mrnrlo Ctlh ••d Cub r:qulvoltnl pcr1olniot 10 dlsundnu<d opcrttloo - (0.19
Cuh and rash tquhaltnUallhc end orthoyur 178.02 172.91
Notu: 1 The above resull.s of KEC lnternatioul Umlted (the Compony), its branchi\S, jointly ~ontrolled opuations and its Subsidiaries (to~etber referred to as 'Group') were reviewed by the Aadit
Committee and approved by tbe Board or Directors 11 their m«ltlng$ held on November 7, 2019 and November 8, 2019 respe<tiyely. The Statutory auditor$ of the Company bav~ c.ondact~ a "Limited Review" of the above ConsoUdated Vnaudited l'i111nclal RI\Sults for the quarter ond half year ended September 30,2019.
2 The above results r>f the Company h•ve been prepared in aeeordonce with the reco~:nilioo ond me•sur<>ment principles laid down in Indian Atrounting Standard 34 "loteriiD F"manc!al Reporling" ("Jnd AS 34''), prC$Cfibtd under So.:don 133. or the Companlu Aet,l0!3, .-nd the. other accountin& principles generally accepted in lndi•.
3 The Group is prinarfly engat:ed in th.o business of En&ineerin&, Procurement and Construction. (El'C) relating to lnfrutrucrure comprising products, proj~cts And systems for po,.·u tnn<miuion, distrlbulion and related octivltie$. Information Is reported to 1nd •valuated regularly by the Chief Op~rotine Decision Maker (CODM) for tbe purpose or resource alloeatloa a4d assessing perrormontt focusses on the business u • whole and occordingly, there is·sJn&le reportable$<tgment in the context ofOpcnotintt S~n>ent u defined under lnd AS 108.
4 'Effective April Ol,2019,the Compony has adopted Ind AS 116, " L~ses". The Company his used the 'modified retrospective approocb' and ronsequently, comparatives ror prmous periods have not been retrospectively 1djustcd. On transition, the Contp,any has rl'<:orded lhei~SL' liability nt ille present value of fu ture lease payments discounted using the incremcntal borra,.in& rue and hu :Llso chosen tltt practical expedient provided In thestandard to measure the right-of·useat the some valu< u thelcue ltnbllity. The adoption or the new atondnd resulted In rl'<:ognillon of'Right-of·use' asset ond •• equivolent lease liability as on April 01,2019. The effect of lnd AS 116 on the profit before tu, proliJ for the period ond eamings per shore are not materi:il,
s The listed se.eured non-convertible· debentures aggregating to R.i. 250 Crore IS>ued by the Compon)' are secured by way of first charge on immovuble and movo.blc·properties of llle compa.oy 1ituated at Vadodara and l\1ysore and the rompany maintains IOOY .. sset eovt.r.
6 Additional disclosures •• per Regulation 52(4) ofSeeuritie.:J and I::Jeh•nse Board or India (U<tingObllgorions and Disclosure Ruquirements) Regulations, 2015:
Sr. As at
No. Partku-lars September JO, 2019
1) Debt Eauitv lbtio [Refer Note hi 0.08
bl Debt Service Covuaaeltiltlu !Refer Note hi 1.42
c) lntere$t Set'lllee Cove rue Ratio IRe fer Note hI 3.4)
d) Debenture !Udemp(iqn Reserve IRs. ln Crorel 38.?6
tl Net Worth IRcfor Not• h) IRs. In i::rorel 2584.J6
0 Net Profit alter'fu (for the halfyear ended September 30 20191 IRs. in Cro~el Zl7.73
g) Basic Earning' per Sh~re from coptinuing and ~i,contlnuln& operations (for thti holfyeJOr ended September 30, 8.86
2019) (Rs.J . h) The formula U$cd for c.alculatoOJI of r•tlo~ IS as undtr . i) Debt 'E.qult)' Ratio c U>nt: term loaM and Debentures I tquHy il) Debt Service.Cover•ge .Ratio - Profit before Oopreoiation •nd Amortisation, Finance Cost -nd T•J I (flnonctt<?ost +Principal re.paymont ortong term IDtll$) Ill) lnt•i'eyt Sel'\·ite Covera11c Ratio • Profit before Depreciation and Amortiutlon. Fiunce Costaod 'fax J Flnon~e Co" iv) fl(et Worth • Share capital+ Other equity (i0tludln& all reserves)
I) Tho credit r;otin& awgned by ICAA for Non·Conve.rtiblt D•~nturtslssued by tbe Company (excluding jointly ronlrolled open dons} Is ot 'A.A·', j) The out d.ue d•tc ror payment of l nterll$1 ond Prhlci)'>JI in cu~or2SQO, Zero Coupon S.ecured,ltatcd, llited, Non-Convertible, Jtedeentllble, Ta~•ble .Oebent•rt&·(NCDs) ofrue •-alue of 1U.
10 Lakb each, aggregulng Rs. 2~0 Crorcs, lssp·ed by tho Comp•ny (ucludinsJointJy controlled oporatlo.ns) au Ottober 28, ~016 are 3.S under: a. ISOO 'NCD$ (Strles J)- Aprll%0, 2020 b. 500 NCDJ (Series U) - AprlllO,l02 I c. 500 NCDl (Series Jll)- Dec<!mber 20,2021
Infor-mation of Standalone Une~dited foln~nci•I.Rl'ftlltsufth• Company i~ a$ under:· R.1.ToCre~ QoQrter cnd~d ruliYcartnded Yurtnded
Pntlc~lori Scpt~mber 30, JundO, Stpte~lber 30, Scpt~mb~r 30; Sept•mbcr 30, Mar<b3J,
lOU 1019 2013 2019 20~8 1019 (Unaudllod) (Unaudlttd) (l}naudited) (Unn~ditcd) (llnaudlttd) (Aud1otd)
A IRovenue frb/1'1 Ql)_~fll.!lons 1469 ~7 21. 3 I 22J3,RZ 458169 ~080:2? l0JI7.JI B l.t>rnli . btforo tu 167.76 t29.85 152-.R• 297-:61 263.98 7JS.I9 r l'rontaf'tu tu 132.62 85.94 QS.Iiri 2i8.s6 7U8 <197.6
8 11oo Cornpnny hu th!ct.ed to CACrtlsc th~nption permitted under Atttton IISBAA or the fnoome TuAcl, 1961 u lotrodoced b)' the Tol<Ation l.aw• (AIIltlldlntnt) Ordinance, 20lf. AroordlnJIIY, lb• Comp•ny ha~ recogn~ed l'rovlsion for lncom" 'fax for the slx months ended Soptembor 30,2019 and r<mto,urod itt Dererrlld Tu ~.lability bv$1s the rate prescribed In the nW s«1lo~. Tht r~u lmpaet or this chAnJic hq5 boen rorogolsed In the Stowntuot or Pront and U>$s rortho quHter l'.odtd S<l!tCmbor 30, 1019. Tht <urrtnt tu charge for the period lncludi\S thar.:• ror t~trller periods for Joint Vc~turo and Subsidiary ag&resatine to lb. 26.57 cror~.
9 'floe appeal nt~d by the dolnt Vtnturo (JV) In South 1\Meo •gainst the advcrl e order JII.U~d by Hoc solt arbitrator rcvcr~lng tbe favorable adjudication award of JU, 62 <rore, h~• been d~ed orr by tho t:ll&h Court of South ;\f'rlta on October 4. 2019 In fnor of the J V, where by • fr'l!Sh •rbltratlon would be carrlcd out by a new a rbltra tor.
10 The Comp•ny wos awarded s oontr~t<tto compl.ete a.n 8~0 km 765 KV and 400 i<V transmbslon Uno In July 2017. This prbj~t is or Jlratcglc lnlportante for grid connectivity and na.t~llhy of the southern arid. The Cnrnp•ny has completd almost SO'A. or the tot• I projctt work lovolvinij erltkal actM1lt~ lncl"dlng ftlundolion, tower supply and erectlon. Tho projt:c:l ~e1t111Won hu lubstantially slowed dOWD sl.ntt J onuary lOJ? subJ~qucnt to dcl•yed payn•ents frorn tht CUJtomer due to liquidity i$3UO$. A$ on Septombor 30, 2019, tho Company bas In oxposure or R.i. 146 Croros. Tht ~urrtn\Spontors and lond~rt ere I~ the proco!!ls of dlseussion with various parties to identifY a ntw sponsor and the tlnolna/antount or recovtry ottht •mount~ ouuunding are larlfdl' dependeut upon linallutloo or tht now aponsor. Manogtment ts conl1dtnt or. positive molurlon and dut$ not fort-sec • llllt&rlJII inlplCI on lJJe OJUncbl nuen•~nr., d\10 to, ... Strategic Allure of lht projtct Ud conslderill& the n.lUIIbu or poltntl•l.sultor• fort he projeot who are In a·ctlve diSCU$slons wllh thu leuderund thupon•or or the project.
lJ The Group has opted to publish &xtra<t of ConJolidattd Vn~udltcd folnanelal Res lilts for lht quarter and half year "lld~d Scplt.mber 30, 201?. 'fbe Consolldottd 111d Standalont Plaanc.lal Reiult.l for the quarter and half year ended September 30, 21119 or the Comp•~Y pr~pared In ueturd•n<o with 'R•eulatfon 33 or the SEBI (Littlng Obligotlon' and Dlsclo1ure Requlrttntntt) Rtculat[o"" lOIS. will beovallablt oa llu:, ,.~bslteoftbc Cont~any, 8.~£ Limited and N•tional Stol'k ExchMguf India Unoht4.~1·.....::;:::::=:::-, ...
Pt.u : Muorbat I>••• : l'lowa~rt, lOit
1~Q~ \
.... ·~""'''"''"': ""'""'
VINAL KEJIUWAL MANAGING OffiJ':CTOR & CEO
DIN • 00016981
Price Waterhouse Chartered Accountants LLP
The Board of Directors KEC International Limited RPG House, 463, Dr. Annie Besant Road, Worli, Mumbai- 400 030
1. We have reviewed the unaudited consolidated fmancial results of KEC International Limited (the "Parent"), which includes 21 Jointly controlled operations consolidated on a proportionate basis, 40 branches and its subsidiaries (the parent, its branches, jointly controlled operations and its subsidiaries hereinafter referred to as the "Group") for the quarter and the half year ended September 30, 2019 which are included in the accompanying 'Statement of Consolidated Financial Results for the Qua1ter and HalfYear ended September 30, 2019', the unaudited consolidated statement of assets and liabilities as on that date and the consolidated statement of cash flows for the half-year ended on that date (the "Statement"). The Statement is being submitted by the Parent pursuant to the requirement of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (the "Listing Regulations, 2015"), which has been initialed by us for identification purposes. Attention is drawn to the fact that the consolidated figures for the Statement of Cash flo\.'15 for the period fromApri11, 2018 to September 30, 2018, as reported in these financial results have been approved by the Parent's Board of Directors, but have not been subjected to review.
2. This Statement, which is the responsibility of the Parent's Management and has been approved by the Parent's Board of Directors, has been prepared in accordance with the recognition and measurement principles laid down in Indian Accounting Standard 34 "Interim Financial Reporting" ('1nd AS 34"), presclibed under Section 133 of tho Companies Act, 2013, and other accounting principles generally accepted in India. Our responsibility is to express a conclusion on the Statement based on our review.
3· We conducted our review of the Statement in accordance with the Standard on Review Engagements (SRE) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity", issued by the Institute of Chartered Accountants of India. This Standard requires that we plan and petform the review to obtain moderate assurance as to whether the Statement is free of material misstatement. A review of interim financial infonllatJon consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Standards on Auditing and consequently does not enable us lo obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
We also perfot·med procedm·es in accordance with the circular issued by the SEBI under Regulation 33 (8) of the SEBT (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, to the extent applicable.
4· The Statement includes the results of the entities listed in Annexure A.
5· Based on our review conducted and procedures perfonned as stated in paragraph 3 above and based on the consideration of the review reports of the branch audite:>rs and other auditors referred to in paragraph 7 below, nothing has come to our attention that causes us to believe that the accompanying Statement has not been prepared in all material respects in accordance \-vith the recognition and measurement pdnciplcs laid down in the aforesaid Indian Accounting Standard and other accounting principles generally accepted in India and has not disclosed the information required to be disclosed in terms of Regulation 33 of the Listing Regulations, 2015, including the manner in which it is to be disclosed, or that it contains any material misstatement.
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6. We draw attention to Note 10 of the Statement, regarding delays in recovery of receivable amounting toRs. 146 cror.e from a customer. The recovery of the amount is dependent upon transfer of the existing contract from the custo.mer to a new sponsor.
Our conclusion is not modified in respect of this matter.
7. We did not review the interim financial statements /financial information/ financial results of 34 branches (Abu Dhabi, Afghanistan, Algeria, Bangladesh, Burundi, Egypt, Ethiopia, Georgia, Ghana, Guinea, Indonesia, Ivory Coast, J0rdan, Kenya, Lebanon, Libya, Malaysia, Mali, Mozambique, Nepal, Nicaragua, Nigeria, Oman, Papua New Guinea, Philippines, Senegal, Sierra Leone, South Africa, Sri Lanka, Tanzania, Thailand, Tunisia, Uganda, Zambia) and 21 joint operations included in the standalone unaudited( audited interim financial statements/ financial information/ financial results of the entities included in the Group, whose results reflect total assets of Rs. 2,653 crore and net liabilities of Rs. 174 crore as at September 30, 2019 and total revenues ofRs. 467 crore and Rs. 896 crore for the quarter ended and for the period from Apri11, 2019 to September 30, 2019 respectively, and cash flows (net inflow) of Rs. 98 crore for the period from April 1, 2019 to September 30, 2019, as considered in the respective standalone unaudited interim financial statements/ financial information/ financial results ofthe entities iQ.cluded in the Group. The interim financial statements/ frnancial iriforma tion J financial results of these branches and joint operations have been reviewed by the branch auditors and other auditors whose reports have been furnished to us or other auditors, and our conclusion in so far as it relates to the amounts and disclosures included in respect of these branches and joint operations, is based solely on the report of such branch auditors and other auditors, who carried out their review and issued their unmodified conclusion vide their report and the procedures performed by us as stated in paragraph 3 above.
We did not review the interim fjnancial statements f financial information I financial results of 15 subsidiaries included in the consolidated unaudited financial results, whose interim financial statements I financial information I financial results reflect total assets of Rs. 1,356 crore and net liabilities of Rs. 564 crore as at September 30, 2019 and total revenues of Rs. 360 crore and Rs. 690 crore, for the quarter ended and for the period from April1, 2019 to September 30, 2019 respectively, and cash flows (net outflow) ofRs. 5 crore for the petiod from April1, 2019 to September 30, 2019, as considel'ed in the conso4dated unaudited financial results. These interim financial statements 1 financial information I financial results have been reviewed by other auditors and their reports, vide which they have issued an unmodified conclusion, have been furnished to us by the Manage01ent and a.ur conclusion on the Statement~ in so far as it relates to the amounts and disclosures included in respect of these subsidiaries is based solely on the reports of the other auditors and the procedures performed by us as stated in paragraph 3 above.
Our conclusion on the Statement is not modified in respect of the above matters.
Place :Udaipur Date :November·a, 2019
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An nexure A
List of entities consolidated:
A Jointly Controlled Operations l Al-Sharif Group and KEC Ltd Company, S::wdi Arabia 2 EJP KEC Joint Venture, South Africa
3 KEC-ASIAKOM- UD ,JV
4 KEC-ASIAKOM J\'
5 KEC-DELCO-VARAHA JV 6 I<EC-V ARAHA-KHAZANA ,JV
7 KEC-VALECHA-DELCO JV 8 KEC-SIDHARTH JV 9 KEC-TRIVENI-KPIPL-JV
....;._,
10 K EC-UNIVERSAL.JV Jl KEC-DELCO-DUSTAN-.JV --12 KEC-ANPR-KPIPLJV 13 KEC-PLR-KPlPL J\' 14 KEC-BJCL JV 15 KEC-KEILJV J6 KEC-AB EPLJV
17 KEC-TNR INFRAJV 18 KEC-SMCJV 19 KEC-WATERL£AU JV - --2 0 KEC-AASBJV 21 KEC GJ ICS (Malaysia) SON. BHD. ·-
B S ubsidiaries I KEC Power India Privnrc Limited ---:l RPG Triln.srnission Nigeria Limited - KEC ln\·estmenL Holdings -3 ---·-rr<.c:c CIOblll Mt1tll'ilius 4
r-? KEC lntcrnntionul Malnysin SDN 6 KEC Global FZ LLC
r---SAE Towers Holdings LLC r-Z----
8 rsA E Towers Brazil Subsidiary Company LLC --SAE Towers Mexico Subsidiary Holding Company LLC ..J 10 SAE Towers 1\Jexico S de RL de CV -- - -
- - SAE Towers Bruzil Torres de Tmnsmis:-; ion l.td;~ ll
12 SAE Presta dora de Sel"vi<: ios Mt> xico S de RJ . <lc CV f--
SAETo,,·ers Limited ---13 Jtl SAE Eng{!nhutia E Com;tru<'uo Ltda . 15 KEC Engineering & Constnlt'tion ScrvirPs, S de RL de CV:
(Formerly known ns S/\E Enp,inccring & ConstniC'tion Scniccs1 S de RL de CV, Mcxico2 -
ROlldOflice
KEC International Limited CIN No. · USlOOMBlOGSPLClS2061
i RPG House. 463, Dr. Ann e Desant Road Worh Mumbal • 400 030
St•trmont orSr1ndolone tlnoudlted f1nonclol Ruultt for the Ouarler ond Holrveor ended Sentrmber 30. 2019 Quanutndtd H•ltyurendtd
PaniC~Jiar'S S.pttmbu30, June30, Stptentbor 30. SepttAil>er 30, September 30,
2019 1019 1018 2019 2011 (Unoudited) (Unaudited) (Unoodited) (UnJudited) (U .. udited)
I Revtnue ftora opentiOM 1A69.57 2,113.11 2,lJU2 4.SU.6) ~,880.19
2 Otbtr ineomt: 3.93 3.14 4.14 7.07 17.59 3 To11J lncoo11 (1+2) 2,473.$0 2,116.16 1,237.96 4.519.76 ~.097.18
4 £'J.ptMt:' (i) Co.1r of mitftrtalr rcmuuntd 1 ,13~.?6 9?0.18 1,119.7? 2,205.04 1.964.87 (II) Chlnauln inv<ntori<i or nnlshed goods, wol'k·in·prefl.re" (40.81) (30.77) O.JO (71.58) 17.G6 (ill) Erec(ion & •u.Hohlracdna t:tptns.u 551.93 511.69 509.46 1,114.61 1,013..18
(i•) £mptoyfe be.ntCill txpen.u 193.65 15'-63 157.62 3$3.28 313.38
C•J Ftraan<'t cests 77.35 66.95 70.39 144.30 116.87 t•l) Dcp~1ton a.nd a-noniudtn upen.se 17.95 19.69 15.78 57.64 51.01
(vii) Othu tt:pmns 2~9.91 211.94 Z81.98 471.15 315~
Tolalrsp..,.es 1,.105.74 1,916.AI 1,085.12 4,191.1 5 .l,JJ.l.90 s Profil berore tu (.HI 167.76 119.8$ LSU4 197.61 163.98
6 1"at tx:pensu: (i) (."'ur..-cnl Tax 63.91 57.~6 57.64 UI.Ol 96.63 (II) o~rettrd Tax (U.8l) (IUS) (J.70) (~2.38) (~.33)
'l'ot•l T .. ·E~perut 35.14 43.91 5).94 79.05 U.lO 1 l'ronr ror tM period (S-61 uuz 85.94 91.90 21U6 171.68
• Other Compreltentlve lncome (I) lttna tb11 ,.ill not be rctlasstned to pronr orloss (0.06) (0.01) (I.U) (0.13) (1.18)
(II) lncometn n:latio& tolttms dut wllloot be ndaninrd 10 proOI or J.ot• (UI) 0.01 t.J7 (0.59) 0.14
(lil) lltm$thJt wRI be •••u .. ir.td to pront orion IO.J9 (?.U) 1M3 1.56 J6.N (tvllocomc: 11x. rtlarln; to htentl!••• win be rtduilntd to (G.I9) U? Cl-1111 1.70 (S.1JI
pronr or loss
9 Total Oth•r Comprtbtnlivr lrltontt ror the p<riod a.u (5.19) 16,03 3.54 19.47 10 Total Comprthen.<h·tln<omr for tllr period (7+9) 141.45 80,65 114.98 111.10 101.15 II l'al<l·up tQulty•h•re e.oopital (rar• ••lue Rs.l/- nth) 51.42 51,42 51.·12 5 1.4Z SIAl
11 Otbu Equity U 810lel OUuttd Eoml:np Ptr Shote (In Rupees) ottribetoblt It ownen (oot
•••••ll .. dl $.16 3.34 J . .ss Ul Ul
.S.. in Crore
Ytlr rnded
Mal'<b31, 2019
(Audited)
10.117..10 38.11
IO,ISS-91
4.910.58 10.36
1,713.36 629.96 114.15 JOS.Sl 756.10
9.420.73 735.19
119.68 7'.&1
137.50 497."
(O.Z5)
0.03 43.1J
(ID.6S)
3U6 529.95 5 1.42
1441.92
19.36
KEC International Limited Staremenr ofSrandalone AJ~tls aDd Llabllhlts u a r s ·•orember 30. 2019 Rr.lnCrore
AJar A.101
Pa.niatl•n Seprl'DllluJO. Mntb 3 1. 2019 1019
lllluu4ired) (Audiled)
ASSETS I Non-CumniA.Is<U
(a ) Propet1)', Pbnr ond £<juipmtnl 621.76 616.17 (b) Ca pilal work·l.,.pro&rtJt s.ao 5.17
(c) Rlpr-of·UJ< A.Jser 11.77
(d) IJJiancJbl~ Asl<b 99.36 110.96
(o) finlJid al A.11<1J (l)hwtsrmenb 610.72 435.91 (ii) Loant IO.U I.U (IIi) 0 1ber nuon<ial unu 2.JS 4.76
(I) Non·CUM'tnt Tu AJ>eiJ (Nrt) 156.54 ll4A9 (a) 011ou Non-e,,.,...,,.,.,, 107.73 166AO
Tot-o I Non-Curredl Asn.h 1,737.19 1,463.45
1 Cu.-rtnf A.Ucofl
(•) lnvtnlorltf 516.1 ~ 469.13
(b) l'lnand1l A&ieoa
(I) 'I' I'll de retelvabl .. 4,908:10 4,73.4.49
(II) Ca1b 1nd ruh equlvolonlt 254.84 U 6.69 (Ill) llouk bola11Cf\ other !loon (II) above 9.16 I OMS
(iv} l .oonJ llH-73 67.37
(v) Oihtr nnondal us<ll 37.56 101.53
(<) Conlro<l AQell 3,031.'11 J,126,0f
(d) Curren! Tat AlltU (Nel) 15.55 13.61
C•) Olh<r rorrtnllfSOif ·~.09 777.10
To1af CuM'<nl Autl~ 9,1S7.8t 9,6.16.71
TollfAners 11.495.07 11,180.13
EQUITY AND LIABILrfli:S
Equi'Y (a) £<1wf>' Short npital 5.1.41 51.42
(b) Other Equi'Y 1.581.51 1,4-~Ul
1'olol £<lull)' 1.,633.00 1A9U4
t.lobUillu
I Non•Cun-tn• ll• bililfew (a) fln• ntlal UobOhr ..
(I) 8orrowlnlf 161.00 l77.91
(II) &Aut ilobflltlrJ 10.47
(b) Provl~lons 9.33 10,17
(c) Dtf<rrtd ru ilobllltlu (Nel) 100.07 143,S7
T oral Non•<'urrtJtl iloblillltt 181.07 Sl1.1'
1 Currenlllobllldt.l
(a) Finan<l• l t.lobUillt.<
(I) Bo~rowina• 1,114.1$ 1 ,14~.84
(II) Leutllobililltt 11.80
(Ill) '!'rode P•Y'Ibl<~ • TotllouiJIOndlnc dutl of mlmt and sm•ll t nlerprltu U?.S? 7).19
• To11l out•r•ndfna dun or crrt.llto"' olher thin mtero a.nd rrtJall tnrnptiUJ 3.U0.70 4,S4S.15
(lv) Olhor n nantl•l llablllllfl 344.76 71.33
(b) Conrroct Lloblllllo.• 2,007.96 2.0&6.14
(c) Olhtr currentlllbllllito 49.23 81 .0.1
(d) Pro•blont 4J.94 44,05
(<)Current Tn Ll1blllll" (Nee) 35.14 30.75
Torti ~urT~I\1 htblllties 3.511.00 8.074.13
Total Equi'Y and Llobililiet 11.495.07 11,100.13
KEC International Limited Cub Flow Stat<mrnt ror the Uatryur t<Mitd Stpttmbtr 30,1019 Rl.laCro ....
Harrynr<nd..t Hair year-..! Parriculan S.pt<n.-bu 30,ltiJ S.p .... - JO, 211.
(tlaavdit.d} (Uuodittd) A- CAsH FLOW t'RO~J OP£11A TING AC1'IVITIES: PROfTTfOlt Til£ YI:ARAFTI!RTAX UL56 171-'1
'r.w ........ tuflpntc 19..e5 tue ~ .... - ... lloo··- $1~ SUI l'roCd oo .. r. ol..,....l'l)', pblol .. d ·~'-' (ll«) . (UI) ,__ .. ,...,..,,, pblal uf eqolp...., dlJ<IIdcAI II lotudblc&n<1t dt~ht<l 11.11 . fiea.MCcotU 14•.30 JU.al la&ttnl fncO'I'N {).M) {12../il)
A4P,tUnc.nl 0U Kt'tUIN tl IMr 'IIIIC' t( na .. tb! .,.ral\ttu: (ll.IJ) (l.lJ)
Bad dcbt~olola:t aocJ adranco •r5ur• oft' (..ct) 36.JJ 19,46
A.Jtow-U<c for b•d and doublfllt debit. M&Ai ud ld\'aMfS (lrf) 6.18 J.ll Mark 10 marloC't ltu •• (On\ ltd ud coounodll.) (Ofttracl' 62.11 .... Nc1 vnttalhed cuh.a•ae c•ln (16.19) (117 ... )
l6S.SI 16J.At ChtnJ<tlo meu and Uobllltln SC..I7 l3J.I7 ~l!«t , , •dldl!t# tru:tflM[l
AdjultfflJtnl•f;, {lnt rllllt<l) I *tNIINS« (, *J~I~ ~h~#
{J)\(OJOriel (46.91) 11'-'41 ,~rUe l'fftlnbltt (150.Al) (ISUll l.od> ll l.JI) (USJ Ott.lcr nuoctaJ ~~ a,.d torur11t1 I"NtU 183 • I (56.17)
Otlltr curr~'ll IWCIJ (108.41) (l'IUI)
Olhtr ota-(:UI'TCA11.~1) (40.0J) (15.0)
( IU.Icl) (61<1.11)
Mjt<-JNI'"""JI/(_j,_.,.,.tl•flldilltln:
Ttl4<,•>dln 1610.71) (l,I!IIM)
Ot~r nrnal llalltllidtt••4 c .. lrt<C tll*kl (11.-s) »n Otw n. .. m~tuWb•k• lUll IM ,...,.._, o..u (Jl.lA)
(147.1J (l.lf&.47)
CASII CENERAT&D ~'ROM OP&RATIONS (lSl.S&J (I,J"-17 Toud ,.U (0<1 ol rdloUJI nn.111 (UU') NET CASII FLOW US£1> IN OP£RATINC ACTIVO'IES (AI (5l5.16) (1.516.Kl
8. CASII Ft.OW Pl(QM INVESTING ACTrYrTIES Ctp.)tl Opt..,ll•re .. propt<1), pblal W t ... lpMUI II loiM&Jblc -It (tll('l' ••Jo.-.. tat flf IMrttWdHruM '• u,lw "•.........,. prtl.f'ttlud ad•••fn tor~ot
,., ... ,, (5UI}
f-\J)Cftdtlui'f') Pf'lof«d• trem .aiC! of t•nlpttt)o pltnl ud t~ip~nl De• l.t$
P.-J llltllf lt¥i"tnb h~H'jUitftltiA JUtuhU•rCtJ (iM:flildi•C Jh1rt 19Pt1C'Jd011 tMI'tt)) (17U1J
l..o.tDJJt(\M 10 I '"'tldlll') (31M) JU.•n Lea11t l'('ptJd '> • wbJictl•f) fMlvdi:•a Jottte•t . •.H loltrC'•I rtc.thcd 3.71 lOJI 8•nk b • llt.nttt (lndudhll non-twrttflt) ftOI U fldiltrtl.l IJ C1Jb A"lf UJh rQ11Intrrm (11t1~ to.as 16U7)
f'IET CASH FLOW 11$t:O IN INVESTING AC'rrVI rUtS (Bl (19At) (IIU•I C. CASII FLOW F'ROM I'JNANCJNG AC:fiVn'lli:S PtO«cdJ from ocbtt I billA .thorNtnn bot~ In~ (lndndfftl Mbentwrffl JUJ .S.JJ Rep"n•ettt or toJ!C obiiCiifl•)tl t (S.st) CUll lfttf~' JfJfln thOtN"tm bOtro\wtna.,(dol) "'·" 1,71U,7J
ft•ui"Ct'C.O'UPII\1 (118M! ( 107.111
Olrlii<IR~ 11tl4 (69.01) (60.Jil
NET CASU FLOW CENS!RAT£0 BY I'INANCING ACTfVITIES (C) 7.:1.61 1.510.71
NET INC'RUS£ I {O£CREASF.) L'l <.'AS II AN'I> CAS II EQUIV AU:I(J'S (A+II+Cl IIS.U (5l.A1) Cult tAd tbh \'«llllh'Jitnli at lht tH:Jiaftlnl tt tM )hf 146.69 176..)1 Etrt<t o( vc""itC d1fttttiKCI u m•••~•• ttforclc,. tutftM) C~b tH c-atb rq.ah,lcnli (1.51) ...... CASH AND CASII &QUrYALEI'o'TSAT11f£ £NO OP HAL .. \'tAR l.S*.IA 1)4.Jt
Not .. ;. 1 The 111bove resulu- or KEC lnt-erriadonal .Lirnlte.d, its btJ:ucht:t and jo\ndy controlled operatii>Jll' (togdbtr rtfr.rred to u 'Cornp.any') wet~t reviewed by the Audil Commftt"'and approved by rlte Board o·(Uirecto·rs ar
tbtir tnutinas hrld on Novtmbt.r 7. 1019 1nd NovemberS, 2019 rtsptetiVdy. The stJrutory audifars oftbc Comp.any havr. tondutft.d il "Limlre:d Review•• or cbe.abovtSI.andalone Unaudited Financial Rt.sull$ for the q.ar10rand b:olryear ended Septembtr30, 2019.
2. The above ruuJts or rb.r- Company hav-e btco prepared in att-ord.A.nte whb tht rc.cognhion and mc-;uureme-nt pri:nelplt.s l111id down fn lndi-an A~copntina Stand.ard 34 .. Interim Financial ;Repor1tnc." ("lnd AS l4"), prescribed under Sec cion 133 orthe. Comp.anies A.ct, 2013, And tht otbu •«ounting. prlnc:iples reaua)ly atC'epced fn tndia.
3 The Company it primarily tnpgtd in lht buJ:I.ntss or En&inC".ering~ Proturcmtnt •nd C.onstrue.tion (£PC) rdatin& to JnfrufnltCure ~omprUinc produtt:s, proje.e:b and systti'JU for power t.tall$mission. distribution and r:t:l.tted 2Ctivit.ltt.ltlformario'' is rtporud to and evalUated regularly~ the QjeJ Optracing Oedsion Mak.tr (CODM) ror the purpose orresou:t<t allocation aod IUJes..·dng performance rocu.ues on rhe bus.inus as a whole and arx:ordlngly. the.re is single. rt:portabfe •ttment iu lhe conrM.t orOptradnt St=mttlr as drOned u.nder lnd AS 108.
4 £fT«tive A,prH 01, 1019, tb.e Compxny hu adopted lnd AS U6, ··~:a-es11• Tho Company has w-ed the "modifitd n:rrosptclive approach' and cons~quently. tompar1tives: for prevlou.s pedocls: have qor bet:n ntro.sptclivcly adjutred. 9n tnua.idon. the Company hu r«ordtd the luse liJbiUty ar the present v.alue of futurt: luse paymt:tus discounted ush1~ tht iner""emental borrowinc race aqd hu allo (br;t.Stit the pracdcal C:J;pedient provldtd rn ~be Jtlnd.ar'd to mtuure lht rigbt.-tf-uu lill the l.lme vaJut: u the lus.e liabUlry. 1'be adoption or !ben.,.,. standard ruuhed In r«o&nition or 'Rlght"or·use' a.set and .n equivalent leas. liability •• on AprO 01, 2019, Th• e!Teet of lnd AS 116 on tho proOt berore tu, profit ror the pulod •••d tamin~t~ oer share. are not mattJial.
5 The listed uc::Und ·no.o-coo\Jutible dcobtJJtures agv~adu: 10 RJ. 250 Crore b!utd by lht Company are·seeu-rtd by way of fti"St thaf'lt on tmmoVIblc and movable pr'opl'lrlit's or tbf:! Corup:~ny th_ua.tcd at V1dodara and Myson a.ncJ tbt Con1p1ny malutainl 100%-asnt rover.
6 .. 1~' I 'R IliAd 5~(~) rs if dExtb 0 dorl d' (l..-i$t'ng0bl'g I' dO' lo Rt . ment•J!Uglli>doru,ZOIS: AddthOn11 l$C'O.ll\lft.$UPU •e on • t(Ul' . ItS Ill ange. oar- n 1.a I J a lOllS an If( S\lr'-t qutre
Sr. Partitu1U'1
AS 11 Stplembu
No. JO, 2019
a) D•bt £Quit> Ratio (Rcrer Not< hi 0.06
b) l><bt Sen•ke Covuaee R•tlo !Rorer Note hi 3.17
el fnterut S<NI« Co•r<•••.R•tlo Rt(er Note hi 3.46
d) Drbenru,.. Redemption Rtserv< !RI. ill Cro...,l 38.76
e) Nrt Wot1h lllrrer Not~ hi(~. in Crol'el l63J.OO
n Ntt Profit onerTt~(ror the l!olrv .. ~ tndtd Seoll'mbtr'JO.l019)11U. in Crort) US. 56
g) Oui• £•mint• ner Sian (for th• bal( ¥e>r ended Srnwnlar30 1019) (Rs.) 8 •. 50
h) The fovmul1 uud for C'llh:ut:ahon ofraUoJ tSas undt.n i) l>rbt E.quity Ratio ~Long Tum loaolJ •nd lltbentu'ft I Equity iJ) Dtbl St:rvice Covtrago Ratio • Profit bdoYe lltprctlllion tnd Anloni.Jaclont F'inaru:e Con and Ta'X /(l;in.»nt:t Cb$t + Pr,ncipat Rlll)'mt.n' of loo; tcwm loant) Ui) lnttrut StrvJu Coverage l,Ud~ • Profit before De-predation t nd Anionlsalio,,, Yinanu Cosf and Tat I J. ... lnante Cosr iv! NC! Wonlo • Share <IOPll•l + Othtr equity (i...,lo•dlng all re<tf'Ytl)
I) The credit ,..llnJ •ulcned by ICRA ror Nou..Convertible l>ebtntuMissued by the Company (u.cluding Joint~¥ controlled Ojlerallans) is at 'AA· '·
j) The nut due d••• (or I'"Y"''"' or !Jlterertond Principal in •••• or lSOO, z ... CouJl<ln ~cured, Rattd, L~ll<do Non•CQIIVtrlllll~. lttd•enltblt, Taubl~ DebtoHUr .. (NCD•) or race Vlllu• or Itt. 10 l;akJt ·~•b, '""'plio¥ lb.150 Croreo, iuutd by th< Comp~uy (urludinc.Johuly coatrolled Oporntion1)0n QrtoborZ-, 2016 aro kS under: a. 1500 NCI)$(Socriesi)-April ZO,gOlO b. ~0 NCDs (Series IJ) - April lO, ZOZI c. 500 NCI)• (Sci'IH All) - Drocmber 10,1021
7 Th.e Conopauy hat tlec<td to exrr<lsolho aptlon prrmltte~ und.r ~~~lion 1156AA or tloe Income 'I '•• A<l\ 1961 "-'lntrodu•td by tho i••,uloo Law• t~<rltndmenr) Ordloan<" 201?. A.ctordin~y, rbe C..mplUly lou ..... go lied Po·ovlslooo for lncontt ,. •• for lbe·alx ftlODih• tnd<d Stprtnobeo· JO, l0l9 •nd r<oooeuure<l Its o.r~rr<!l ..... L,l>billty basis the. rate pr~ctlbed In th• raid ··~rion. The ruu lll)p•rr of lhlt thane• hu bten ..... oenl•ed ill the Sta<rm<nt of.Prplit and Loss ror the q~anereodtd Stpltlllbcr30, ~019. The <Urrenl , .. •"•r&t for the pviod lu<lud~ ch•rc• fOH&rlltr peri ad$ ror Joint Vtnrurt •ggreaari~a •• Jq, l5.06 cr~ro.
8 Tloe appr.al mrd by tho Joint Vrnhoro (JV) ln Soutb ;o.rri<> av•loin me adve<>e order p11$ed by lbe •ole arbitrator rov~nina the flavoroblo o~jlldleltlon a war<! orRr. 61eror•,lou bocn disport<! orr by th• Hl~th Caun orSoulh .Afrlt.a on O(IOb«"r 4. 20 l9 lo ravot of the JV, wh~rr by a ftttb arblfr'tfion would .bi1 r.lrtlett Out b)' a t1tw at'bhrator.
9 Tht Com pony wu awardrd 1 conttatl to <onopl .. e "" 880 ltm 765 KV ltod ~00 KY. trannoolulon llno In July 1017, This proJeet fo or mateslc lm1oononco ror and <onlitctlvlty and $labl1Jt:)' or tho >Out.lotro &rid. 'The Coon pony hu complete~ olin0$1 SO% or the tolllltrojw.work lt;volvinl eridcoLI•CJMtltslnclodlna found•tloJt. rawer lupply ·ond • ndion, 1'be pnt]t<t conllruclion hn J\oh!.,ntlllly llbwtd down lin .. Januol')' 2019 iobsequeut to dtlt)ftd paymentJ ft.on" th.t cu·sJome.r dut tO Uqutdll·y lttuB. Af on Seotunber 30, l019- tht Compatt)' ha• 11n ·~po.ture qf Rt. 14G Croru~ 1'hc filrAnt ·sponsovs •nd l~udtn afe In the proust or d~eus.don with various r••ttla to idtnHf)o a new JPO\\JI)r and the.lhn1n¥/amount oftttf.lv~ry of"fhtJmounfs o-.at.nafldil\i lll'e larg,ti.Y dtpondear -~~pon nna1~a.tlon ofthe ntw sponJor. Manaa,emeotls e,oorident o( 1 poildve resolution •ud dO~ uot fonset 3 mattrJ.allmpac:r on the 1'\oand•l sta~emtnrs. due t6 tht J·trate.gk nature or lht llroj~tJ and tonsldfl'rin,a th~ numb~ or potentlil Slthors· (or the ,uojett who are ill actlve dlll'l"tionJ wilh the lendt" •nd th~ apon~t;w of the project.
Place 1 Mumbai Dote :November 8, Z019 OlN • 000~6981
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The Board of Directors KEC International Limited RPG House, 463, Dr. Annie Besant Road, Worli, Mumbai- 400 030
1. We ba\'e reviewed the unaudited standalone financial results of KEC International Limited (the "Company") which inch1des 21 Jointly controlled op.C'rations consolidated .on a proportionate basis and 40 branches for the quarter and the half year ended September 30, 2.019 which are included in the accompanying 'Statement of St<wdalone Finandal Results for the Quarter and Half year ended September 30, 2019', the sta tement of assets ai1d liabilities as on that dnte and the s tatement of cash flows for the half-year ended on that date (the "Statemen t"). The Statement has been prepared by the Company pursuant to R~::gnlation 33 and Regulation 52 of the SEBI (Listing Obligations and Disclosure Requirements) Regulntions, 20J5, as amended (the "Listing Regulations, 201.5"), which has been initialled by us for identification purposes. Attention is drawn to the fact that the statement of cash Oows for the <.:CHTesponding period from April 1, 20J.8 to September 30, 201.8, as reported in the Statement ha\'c been approve!-! by the Company's Board of Di:rectors, but have not been subjected to review.
2 . This Statement, which is the responsibility of the Company's Management and approved by tne Board of Directors, has bGcn prepnred in aceord~mce with the 1·ecognition and measurement ptinciples laid down in Indian Accounting Standard 34 "lnterim Financial Reporting" ("Ind AS 34"), prescribed pnder Section 133 of the Cornpanie~ Act, 2013, and other accounting principles general1y flcceptod in India . Our responsibility i~ to express n conclusion on the Statement based on om review.
3· We conducted 011r review of the Statement in accordance with the StandaJ·d on Review Engagements (SRE) 2410 "Rev-iew of Interim Jiinnncinl Information Performed by the Independent Auditor of the Entity", is~ued by the Institute of Chartered Accountants of India. This Standard requires that we plan and perform the review to obtain moderate assurance as to whether the Statement is free of matel'ial misstatement. A l'evicw of interim tlnancial information consists of making inquiries, primnrily of persons responsiblr for financial and accounting matters, and applying annlytica l and other re,iew procedtlrc.c;. A review is substantinlly less in scope than an audit conducted in nccordnnce with Standard$ 0 11 Auditing and consequently docs not enabJc us to obtajn assurance that we would bE>comc :nN<ll'e of rtll significant matters that might be identified in an audit. Accordingly, we do not express nn nudi t opinion.
We also performed procedures In accordance 'with the circular issued by the SEBI under Reguliltion 33(8) of lhc SEBJ (Listing Obligations and Disclo~urc Rcquirernenls) Regulntions, 2015, as amended, to the extent applicuble.
4· The Statement include~ the results .of the entitic~ lis t ~~tl in Ann ex ure A.
!;. B11sed on our revie"' cotJducted tiS above and bnscd on the NHlsicJeration o( the review reports of the lmmch auditors nnd other anditMs referred tv in pnrngrnph 7l>elo\v, nothing hns come to our :Htcntion thnt causes l\!-i LQ believe that the Statement hQs not been prepared in all motc~I'io.l re!;pccts i11 <ICcordnnce with the recognition und nWt\Slln!ltlCnt pl'inciples bid clown in the oforesoitlll1cl inn Aecou n ti ng St a ndanl <1 1id o tlwr a(·coun t inp, J)rinri pies g(~nernlly acccptct;l in 1 ndiu tlncl has not disclosed the information reqnircd to bt· di~rloscd in terms of Regulation 33 nnd Rcgnlation 52 of the Listing Regulations, 20 15 inclulll ng the manner in which it is to be disclosed, or that it contains any muteriol missl:ltemcnl.
' AJA -,; ~ -!""" ............................................................................................................. ' ............................ ... .. .... ~'>~.:~.:.:~{:~~:-.~~'"''.~_.:...:!.~A I I '- -.__....- ,
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Prloe '<'/llter~ou•o (s PaMo"-hlp f!frm) eonvoned lnto Prlce watarhouso Chorterod Acc;ountonte LLP (8 Umlted Llllb~lty Pertncrsllfp with LLP l(jonllt'y 110: LLPIN AAC.500t) v.Uh oflect from July 2~. 2014 Post ils convor~fon to Prloo Waterhouse Oh!lrlerod Aocounwnts LLP. It$10AI reglslratlon number Is 012754N/N50001S (ICAI rcglslrollon number b<llore conversion was Ot2·754N)
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6. We draw attention to Note 9 of the .Statement, regarding delars in recovery of receivable amounting to Rs. 146 c.rore from a customer. The reco,·ery of the amount is dependent upon transfer of the existing contra~t from Lhe customer to a new sponsor.
Our conclusion is not modified in respect of this matter.
7- We did not review the interim fjnancial statements /finanCial information/ financial results of 34 branches (Abu Dhabi, Afghanistan, Algeria, Bangladesh, Burundi, Egypl, Ethiopia, Geor·gi'a, Ghana, Guinea, Indonesia, h'01Y Coast, Jordan, Kenya, Lebanon, Libya, Malaysia, Mali, Mozambique, Nepal, Nicaragua, Nigeria, Oman, Papua New Guinea, Philippines, Sehegal, Sierra Leone, South Afric:-t, Sri Lanka, Tanzania, Thailand, Tunisia, Uganda, Zambia) and 21 joint operations included in the standalone nnaudit:ed interim tin:incial statemenls/ financial it1formation/ financial results of the entities included in the Group, whose r~sults reflect total ass.ets of Rs. 2,653 crore and net linbilitics of Rs.. ,1.74 01·ore as at September 30, 2019 and total revenues of Rs. 467 crore and Rs. S96 e.rorc, for the quurter ended and for the period from April 1, 2019 to September 30, 20l9 respectively, and cnsb flows (net inflow) of Rs. 98 crore for the period from April 1, 20J9 to September 30, 2019, as considered in the res):>.ective standalone unaudited/ audited i:nterim financinl statements/ financia.l informatio11/ finanei.al re~mits of the entities included in the Group. The interim financia l statements/ financial information I financial results of these bnrnches and joint operations have been reviewed by the branch auditors and other auditors whose reports have been furnished ~o us or other auditors, and om conclusion in s·o far as il relates to the amovnts and disclosures included in respect of these branches and joint operations, is based solely on Lhe reporl Qf such branch auditors and other auditors, who carried out Lheir revjew and issued their unmodified conclusion vide their rcpott and the procedures pelformed by us as stated in paragraph 3 above.
Place: Udaipur Date: November 8, 2CH9
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Annexure A
List of Jointly Controlled Operations consolidated:
1 AJ-SharifGroup and KEC Ltd Compnny, Saudi Arabia 2 EJP KECJoint Venture, South Africa 3 KEC-ASIAKO~l- UB JV 4 KEC-ASIAKOM JV
5 KEC-DELCO-VARAHA.N 6 K EC-V ARA HA- KHAZANA .TV 7 l<EC-VALECHA-DELCO JV 8 KEC-SIDHARTH JV
9 KEC-TRN ENI-!<PlPL-.JV 10 KEC-UNIV ERSAL-JV ll KEC-DELCO-DUSTAN-JV 12 KEC-ANPR-KPIPL JV 13 KEC-PLR-KPIPL JV ~
KEC-BJCLJV 14
15 KEC-KEILJV -16 KEC-ABEPLJV 17 KEC-TNR INFRA JV J8 KEC-SMCJV 19 KEC-WATERLEAU JV ~-- KEC-AASBJV 20 -
2 J KEC GHCS (Malaysia) SDN. HHD.