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GAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITED[CIN: U45100MH2014PTC260191]

Registered Office : ‘Gammon House’, Veer Savarkar Marg, Prabhadevi, Mumbai – 400025.Website : www.gammonengineers.com Email: [email protected]

Tel: +91 22-6115 3000 Fax: +91 22-2430 0221

NOTICE OF 4TH ANNUAL GENERAL MEETINGNOTICE IS HEREBY GIVEN that the 4th Annual General Meeting of the Shareholders of GAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITED will be held on Wednesday, the 28th day of November, 2018 at 11.30 a.m. at the Registered Office of the Company at ‘Gammon House’, Veer Savarkar Marg, Prabhadevi, Mumbai - 400025 to transact the following business:ORDINARY BUSINESS:1. To consider and adopt the Audited Financial Statements of the Company for the financial year ended 31st March, 2018 together with the

Reports of the Board of Directors and the Auditors thereon.SPECIAL BUSINESS:2. To consider and, if thought fit, to pass with or without modification(s), the following resolution as an Ordinary Resolution. “RESOLVED THAT pursuant to the provisions of Section 152 and other applicable provisions, if any, of the Companies Act, 2013

(“the Act”) and the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended from time to time, Mr. Kirit Shah (DIN: 00344087) who was appointed as an Additional Director of the Company with effect from 27th April, 2018 pursuant to Section 161 of the Act and Articles of Association of the Company and who holds office only upto the date of this Annual General Meeting, be and is hereby appointed as a Director of the Company.”

3. To consider and, if thought fit, to pass with or without modification(s), the following resolution as an Ordinary Resolution. “RESOLVED THAT pursuant to the provisions of Section 152 and other applicable provisions, if any, of the Companies Act, 2013

(“the Act”) and the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended from time to time, Mr. Khushroo Wadia (DIN: 01615341) who was appointed as an Additional Director of the Company with effect from 27th April, 2018 pursuant to Section 161 of the Act and Articles of Association of the Company and who holds office only upto the date of this Annual General Meeting, be and is hereby appointed as a Director of the Company.”

4. To consider and, if thought fit, to pass with or without modification(s), the following resolution as an Ordinary Resolution. “RESOLVED THAT pursuant to Section 148 of the Companies Act, 2013 read with Rule 14 of the Companies (Audit and Auditors) Rules,

2014, the Company hereby ratifies the remuneration of Rs. 1,50,000 (Rupees One Lakh Fifty Thousand Only) plus applicable taxes and out of pocket expenses payable to Mr. R. Srinivasaraghavan, Cost Auditor (Firm Registration no. 100098) for conducting audit of cost accounting records maintained by the Company for the Company’s Civil Engineering Procurement and Construction business for the financial year 2018-19.”

By Order of the Board of DirectorsFor GAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITED

Sd/-GITA BADE

COMPANY SECRETARYRegistered Office:‘Gammon House’, Veer Savarkar Marg,Prabhadevi, Mumbai – 400025.

Place : Mumbai.Dated : 26th October, 2018

NOTES:

a) A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE ON A POLL INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER. A person can act as a proxy on behalf of members not exceeding fifty (50) and holding in aggregate not more than ten (10) percent of the total paid-up share capital of the Company.

b) Proxies should be lodged with the Company at its Registered Office at least forty eight (48) hours before the time of the meeting.c) All Corporate Members are requested to send to the Company, a duly certified copy of the Board Resolution / Authority Letter authorising

their representatives to attend and vote at the Annual General Meeting.d) The relative Explanatory Statement pursuant to Section 102 of the Companies Act, 2013 in respect of special business under Item Nos. 2

to 4 to is annexed hereto.e) The route map showing directions to reach the venue of the Annual General Meeting is annexed.f ) In case of joint holders attending the meeting, only such joint holder who is higher in the order of names will be entitled to vote.g) Members are requested to bring their attendance slip along with their copy of the Annual Report to the Meeting.

2

ANNEXURE TO NOTICEAs required by Section 102 of the Companies Act, 2013 the following Explanatory Statement sets out the material facts relating to the Special Business under Item Nos. 2 to 4 of the accompanying Notice.

Item No 2:

Appointment of Mr. Kirit Shah as Director:

Mr. Kirit Shah was appointed as an Additional Director of the Company with effect from 27th April, 2018 duly nominated by Gateway Infra Holdings Pte. Ltd. (a G.P. Group Company-Investor) pursuant to the Investment cum Shareholders Agreement. In terms of Section 161(1) of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Kirit Shah holds office only upto the date of this Annual General Meeting but is eligible for appointment as a Director. The Company has received the consent of Mr. Kirit Shah to act as Director of the Company. Mr. Shah shall be a Non-Executive Director.

Mr. Kirit Shah is a Commerce Graduate and Graduate member of Thai Institute of Directors. He is the Chairman of G. P. Group of Companies, Thailand a conglomerate having business interests in Shipping, Insurance, Infrastructure etc.

Except Mr. Kirit Shah, none of the Directors and the Key Managerial Personnel of the Company and their respective relatives are concerned or interested in the passing of the resolution set out at Item No. 2.

The Board recommends the passing of the Ordinary Resolution at Item No. 2 of the accompanying Notice for Members approval.

Item No 3:

Appointment of Mr. Khushroo Wadia as Director:

Mr. Khushroo Wadia was appointed as an Additional Director of the Company with effect from 27th April, 2018 duly nominated by Christiani & Nielsen (Thai) Public Co. Ltd. (a G.P. Group Company). In terms of Section 161(1) of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Wadia holds office only upto the date of this Annual General Meeting but is eligible for appointment as a Director. The Company has received the consent of Mr. Wadia to act as Director of the Company. Mr. Wadia shall be a Non-Executive Director.

Mr. Khushroo Wadia is a Science Graduate and a Chartered Accountant. He is also a Graduate member of Thai Institute of Directors. He is the Managing Director of Christiani & Nielsen (Thai) Public Co. Ltd. and also holds Directorship in Precious Shipping Public Co. Ltd. He has earlier worked with Maxwin Group of Companies, Suretex Limited, A.F. Ferguson & Co.

Except Mr. Wadia, none of the Directors and the Key Managerial Personnel of the Company and their respective relatives are concerned or interested in the passing of the resolution set out at Item No. 3.


Item No 4:

Ratification of remuneration of Cost Auditor for the financial year 2018-19:

Members are hereby informed that the Board of Directors have appointed Mr. R. Srinivasaraghavan as the Cost Auditor of the Company for the financial year 2018-19 to conduct audit of cost accounting records maintained by the Company in respect of the Company’s Civil Engineering, Procurement and Construction business pursuant to Section 148 of the Companies Act, 2013 on a remuneration of Rs. 1,50,000 (Rupees One Lakh and Fifty Thousand only) plus all applicable taxes and out of pocket expenses.

Pursuant to Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration proposed to be paid to the Cost Auditor is required to be ratified by the shareholders.

None of the Directors and the Key Managerial Personnel of the Company and their respective relatives are concerned or interested in the passing of the above resolution.


By Order of the Board of Directors

For GAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITED

Sd/-GITA BADE

COMPANY SECRETARYRegistered Office:‘Gammon House’Veer Savarkar Marg,Prabhadevi, Mumbai – 400025.

Place : Mumbai.Dated : 26th October, 2018

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Form No. MGT-11PROXY FORM

[Pursuant to section 105(6) of the Companies Act, 2013 and rule 19(3) of the Companies (Management and Administration) Rules, 2014]CIN: U45100MH2014PTC260191

Name of the Company: GAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITEDRegistered Office: ‘Gammon House’, Veer Savarkar Marg, Prabhadevi, Mumbai- 400025.

Name of the Member(s):

Registered Address:

E-mail Id:

Folio No/ Client Id:

DP ID:

I/ We, being the member(s) of Gammon Engineers and Contractors Private Limited holding ______________ Equity Shares hereby appoint

1. Name:

Address:

E- mail Id: Signature: _________________, or failing him

2. Name:

Address:

E- mail Id: Signature: _________________, or failing him

3. Name:

Address:

E- mail Id: Signature: _________________

as my/ our proxy to attend and vote (on a poll) for me/ us and on my/ our behalf at the 4th Annual General Meeting of the Company, to be held on Wednesday, 28th day of November, 2018, at 11.30 a.m. at ‘Gammon House’, Veer Savarkar Marg, Prabhadevi, Mumbai - 400 025 and at any adjournment thereof in respect of such resolutions as are indicated below:

Resolution No. Resolutions1 To consider and adopt the Audited Financial Statements for the financial year ended 31st March, 2018 together with the Reports of the

Board of Directors and the Auditors thereon.2 To approve the appointment of Mr. Kirit Shah as a Director of the Company.3 To approve the appointment of Mr. Khushroo Wadia as a Director of the Company.4 Ratification of payment of remuneration to the Cost Auditor viz. Mr. R. Srinivasaraghavan for the financial year 2018-19.

Signed this _____ day of _________, 2018

______________________ ________________________Signature of shareholder Signature of Proxy holder(s)

Note: This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of the Company, not less than 48 hours before the commencement of the Meeting.

GAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITEDCIN: U45100MH2014PTC260191

Regd. Office: Gammon House, Veer Savarkar Marg, Prabhadevi, Mumbai - 400 025.

ATTENDANCE SLIP(To be filled in and handed over at the entrance of the meeting hall)

I hereby record my presence at the 4th ANNUAL GENERAL MEETING of the Company to be held at ‘Gammon House’, Veer Savarkar Marg, Prabhadevi, Mumbai - 400 025 on Wednesday, 28th day of November, 2018, at 11.30 a.m.

Full Name of the *Shareholder/Proxy (in Block Letters)

Folio No. or Client / DP ID No.:

No. of Shares held:

Signature of Shareholder/Proxy*Strike out whichever is not applicable

NOTE: Members who have multiple folios/demat accounts with different joint holders may use copies of this attendance slip. Only Shareholders of the Company or their Proxies will be allowed to attend the Meeting.

Affix Revenue

Stamp

ROUTE MAP FOR VENUE OF THE 4TH ANNUAL GENERAL MEETING OF GAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITED

‘Gammon House’, Veer Savarkar Marg, Prabhadevi, Mumbai – 400025.

A NEWBEGINNINGGAMMON ENGINEERS AND CONTRACTORS PRIVATE LTD. ANNUAL REPORT 2017-18

Corporate Information 01

About Gammon Engineers and Contractors Pvt. Ltd. 02

Our Promoters 04

Vice Chairman’s Statement 06

Region-wise Pan-India Presence 08

Boards of Directors 09

Management Team 10

Key Projects-Ongoing 12

Key Projects-Recently Completed 15

Key Project Wins 16

Our Landmark Projects 17

Health, Safety & Environment 22

Engineering Design and Construction Technology Centre 24

Integrated Management System 25

Controls and Systems 26

Awards and Accolades 28

Director’s Report 29

Independent Auditor’s Report 40

Financial Statements 46

CONTENTS

Annual Report 2017-18 | 1

CORPORATEINFORMATION BOARD OF DIRECTORSMr Vimal Kaushik

Vice-Chairman

Mr Vardhan Dharkar Director-Finance

Mr. Venkataramana Heggade

Executive Director

Mr. Kirit Shah Non-Executive Director

Mr. Khushroo Wadia Non-Executive Director

Mr. Maruti S JambagiChief Executive Officer

Mrs. Gita Bade Company Secretary

AUDITORSM/s Natvarlal Vepari & Co.(Firm Regn No.106971W)

REGISTERED OFFICE‘Gammon House’, Veer Savarkar Marg,

Prabhadevi, Mumbai – 400 025.

Tel: +91 - 22- 6115 3000 / 6744 4000

Fax: +91 - 22- 2430 0221 / 24300529

Email: [email protected]

www.gammonengineers.com

BANKERS / FINANCIAL INSTITUTIONSICICI Bank

Canara Bank

Bank of Baroda

Allahabad Bank

DBS Bank

IDBI Bank

Oriental Bank of Commerce

Punjab National Bank

Syndicate Bank

Bank of Maharashtra

Central Bank of India

Indian Bank

Karnataka Bank

UCO Bank

Life Insurance Corporation of India

United India Insurance

General Insurance Corporation of India

2 | Annual Report 2017-18

ABOUT GAMMON ENGINEERS AND CONTRACTORS PVT. LTD

Gammon Engineers and Contractors Pvt. Ltd (‘GECPL’)

is a leader in the Civil Engineering Procurement and

Construction Business in India and serves the nation’s

infrastructure needs across all sub-sectors of infrastructure

including roads, hydropower, nuclear power, thermal power,

tunnels, bridges.

In 2016, Gammon Engineers and Contractors Pvt. Limited

(GECPL) acquired Civil EPC Undertaking of Gammon

India Limited, which was amongst the largest physical

infrastructure construction companies in India, through

the Scheme of Arrangement as approved by the National

Company Law Tribunal (NCLT), Mumbai Bench.


GECPL


MISSION VISION

Through such scheme, GECPL has gained Gammon India’s track record

which spans significant landmark projects built over several decades,

with a prominent presence across all sectors of civil engineering,

design and construction and huge fleet of equipment. Such Landmark

Structures from the Gateway of India to India’s first indigenously

designed Fast Breeder Reactor, GECPL has become one of India’s leading

construction companies, present in all areas of construction

GECPL is certified under ISO 9001:2015 (Quality Management), ISO

14000:2004 (Environment Management) and BS OHSAS 18001:2007

(Occupational Health & Safety).

GECPL’s integrated capabilities span all sectors and disciplines of civil

engineering and construction and is one of the few companies in India

with the depth and breadth of pre-qualifications, design pedigree and

innovation in R&D to deliver the most complex and large scale projects

that is the need of the hour in our country.

Being a pure EPC player we are able to bring a razor sharp focus

on project execution, quality and safety to deliver the best in class

infrastructure projects to our clients. We aspire to build and maintain a

leadership position in the industry in the coming years.

To develop, build and service physical infrastructure for better living, work environment and transportation

To be the leaders in innovative engineering, and timely delivery of our quality construction services, upholding our tradition of being “Builders to the Nation”



GP Group of Thailand is a 150-year old diversified multi-national group

with interests in several sectors of Thai economy, including construction,

energy/mining, hospitality, IT/software, insurance, shipping, logistics/

transportation, manufacturing, pharmaceuticals, sales and distribution,

service, and travel/leisure sectors. The group was founded in 1868 and

in 1918, the group transferred base to Bangkok, Thailand. GP Group is

headed by Mr. Kirit Shah who led the diversification of the company

from a rice trading company to a diversified conglomerate. The group

has invested in over 300 companies till date with presence across 20

countries globally. GP Group comprises 16 distinct affiliated companies

of which 4 (Precious Shipping, Mega Lifesciences, Golden Lime and

Christiani and Nielsen) are publicly listed on Thai stock exchange with a

combined market cap of almost USD 1.5 billion.


ABOUT GP GROUP

Annual Report 2017-18 | 5Annual Report 2017-18 | 5


VICE- CHAIRMAN’S STATEMENTDear Shareholders, I am pleased to present to you the 4th Annual Report of Gammon Engineers and Contractors Private Ltd. covering the financial performance, outlook and major events that happened during FY 17-18.

We have just completed the first full year of operations post acquisition of Civil EPC undertaking of Gammon India Ltd. We have focused the year on smoothly transitioning the operations of the Company while minimizing disruption to our projects, putting in place a strong management team and strengthening core processes and systems such as implementation of a modern ERP system.

We have also undergone a reorganization to create a sector focused management structure and elevated high-performing people from within the organization to create a young leadership team.



At a macro level, the economic survey has indicated that the real

GDP growth is predicted to hover between 7 to 7.5% for FY 2018-19

which is very encouraging. The Government has made a clear and

concerted push for making required investments in infrastructure

as also removing some of the bottlenecks that were impeding

growth and profitability and fund raising. Some of the positive policy

announcements for infrastructure in last year include:

• In Union Budget FY18-19, the total infrastructure outlay was

increased by almost 21% to Rs. 5.97 lakh crore with all time high

allocations made to roads, bridges and railways (Rs 148,528 crore)

• Around 35,000 km of road construction has been approved under

the Phase-1 of the Bharatmala Pariyojana at an estimated cost of

Rs 5.35 lakh crore where your company is a major player. Around

9,000 km of National Highways are being completed in 2017-18.

NHAI will consider organizing its road assets into Special Purpose

Vehicles and use innovative monetizing structures like Toll,

Operate and Transfer (TOT) and InvITs

• The government also announced a programme to focus on water

supply to all households in 500 cities translating to 494 projects

worth Rs 19,428 core that will be awarded. Your company’s strong

credentials in water supply related projects positions us well to

bag those awards

• Government targets “Housing for all” by 2022 with almost 1 crore

houses to be built under Pradhan Mantri Awas Yojana in rural

areas

During the year ended 31st March,2018 we have won the following prestigious projects:• Construction of balance works of tunnel T-48 on Katra- Banihal

section of Udhampur-Srinagar-Baramulla New BG Railway Line

Project awarded by IRCON. Project value: Rs 1187 crores

• Construction of 27.3 kms four-lane bypass connecting NH-29 with

NH-2 as part of Varanasi Ring Road Phase-II Pkg-1 awarded by

NHAI. Project value: Rs 949 crores

During the year your company won new awards of Rs 4,200 crores.

Your Company also secured favorable arbitration awards of Rs 350

crores. Further Rs 61 crores were received on account of ongoing

arbitrations. Along with arbitration awards won in prior years, the

Company is expected to receive over Rs 1,000 crores during the

next 2-3 years.

Performance review For the 12 months as at 31st March, 2018 the Turnover of the

Company stood at Rs 2282.61 crores up from 1,554.08 crores as at

31st March 2017. The Company reported a Net Profit after Tax of

Rs. 5.77 crores in FY18, down from Rs 48.71 Crores during FY17. The

Turnover and profitability of the Company was impacted due to

slow pace of execution of the projects as well as implementation of

the Goods and Services Act effective from July, 2017 .The Company

has been bidding aggressively for new projects

Your Company’s order book is very healthy and diversified across

sectors and geographies and stands at Rs 9,939 crores as of March

31 2018.

Acknowledgements I extend my gratitude to all stakeholders including our clients,

lenders and bankers, partners, vendors and suppliers, employees

and shareholders for their support and dedication and seek their

continued faith and support in our next phase of growth.

We look forward to embarking on an ambitious growth journey built

on the foundations laid by Gammon and imbibe our tradition of

being “Builders to the Nation”

Vimal Kaushik, Vice- Chairman



Highway, Road Tunnel

Road Works ,rubber Dam

Bridge

Hydro

Road

Thermal Power, Heavy Industrial

Irrigation

Thermal Power

Road Works

Bridges, Water Ss,Specialize WellFoundation

State Highway, Bridge, Elevated Corridor

Metro Rail

Hydro

Water,Nuclear Power

Specialize Bridge

Heavy Industrial, Bridge

Road Works, Heavy Industrial

Works

ThermalPower

2

2

2

11

6

1

1

1

1

2

3

3

22

2

5

5

PAN-INDIAPRESENCE

Our Areas of operations

Engineering, Procurement and Construction – Civil

• Transportation (highways, railways, metro rail, ports, bridges and flyovers)

• Power generation (thermal, industrial and cogeneration plants, nuclear and hydro energy,

cooling towers and chimneys)

• Environmental engineering (water treatment, transmission and distribution)

• Irrigation



Sitting left to right

BOARDS OFDIRECTORS

Mr. Khushroo Wadia Non-Executive Director

Mr. Vimal KaushikVice Chairman

Mr. Kirit ShahNon-Executive Director

Standing left to right

Mr. Vardhan DharkarDirector Finance

Mr. Venkataramana HeggadeExecutive Director



MANAGEMENTTEAM

Mr. Vimal KaushikVice ChairmanBorn on 22nd November 1947, Mr.

Vimal Kaushik a B.E Electrical started his

career in 1970 with the PunjGroup as

a graduate engineer . He was also the

Managing Director of Punj Llyod and

during his tenure made Punj Group

a market leader in the the vertical of

pipelines, tankages & turnkey Oil & gas

mega project He was also the Managing

Director of IL & FS Engineering from

January,2010 to December 2011 .Mr.

Kaushik joined Gammon Engineers &

Contractors Pvt. Ltd. in September 2016

as Vice Chairman and nominee of the

G P Group .

Mr. Vardhan DharkarDirector Finance Mr. Vardhan Dharkar is a whole time

Director designated as Director-Finance .

Mr. Dharkar is a qualified Chartered

Accountant with over 30 years of

experience in Finance Banking and

Treasury Budgeting, Cash Flow, Enterprise

Risk Management and Business Planning.

He was previously employed with

Gammon India Limited as Presdient

Finance and CFO . Mr. Dharkar ‘s previous

employment was with KEC International

Limited (RPG Group) and Wockhardt .

Mr. Dharkar is known for his negotiation

skills and currently is in charge of finance

,banking accounting,and direct and

indirect taxation .

Mr. Venkataramana HeggadeExecutive DirectorMr. Venkataramana Heggade is

presently the Whole-Time Director

designated as Executive Director.

He is a senior professional with a

rich experience of over 3 decades

in Construction sector in the areas

of Design Management, Technical

Management, Site Management, Project

Management & Contract Management

of Highways, Bridges, Energy structures

like Chimneys & Cooling towers, Marine

and Hydraulic structures, etc.

He is a recipient of ‘IABSE-Prize’ in

addition to National awards like Pt

Jawaharlal Nehru Centenary award from

IRC; Pre stressed concrete design award

from Institution of Engineers, ICI & IRC

awards for best publications and IBC

award for built environment.



Mr. Maruti S JambagiChief Executive OfficerMr. Maruti S Jambagi is the Chief

Executive Officer of the Company .

A Civil Engineering graduate from

REC Suratkal (Presently Known as NIT

Suratkal), Mysore University, Karnataka,

India.Mr. Jambagi has over 38 years

of experience in Civil Engineering

,construction and infrastructure sector

having executed several large EPC

contracts both in India and overseas .

Mr Jambagi has previously worked with

M/s Gammon India Limited, Huta-Sete

Marine Works Limited Saudi Arabia, M/s

Afcons & M/s Al-Badar Construction

Two Projects managed by Mr. Maruti

S Jambagi got Awards of Outstanding

Structures of India – one – Sharavati

Railway Bridge Project in 1994 and

another – Outfall Project, Mumbai in

1997 by Bridge Engineers & American

Concrete Institute of India.

Mr. K Lakshmi SrinivasanChief Operating OfficerMr. K.L. Srinivasan is the Chief Operating

Officer of the Company. He is a Masters

in Civil Engineering with specialisation

in Highway & Transportation

Engineering and has over 35 years

of experience of construction in

Infrastructure such as Highways (more

than 4000 kms), Bridges, Industrial, BOP

(Iron, Thermal) etc.,Mr. Srinivasan was

previously employed with Gammon

India Limited as President Projects . He

has also worked with L&T, DCIL, (GOI)

HCC & OSEPL

Mr. Srinivasan is an expert in Project

Management, Planning, Execution and

Construction Management.

Mr. Ashish GuptaPresident Heading Contracts & LegalMr. Ashish Gupta is President and head

of Contracts & Legal division besides co-

leading Gammon’s Hydro Power Project

business spread across India & Bhutan.

Mr. Gupta is a a techno- legal expert

with Post Graduation in Civil Engineering

(Structures) and is a qualified law graduate

He has also completed PGEMP from S.P

Jain Institute of Management & Research,

Mumbai.

Mr. Ashsish Gupta has over 27 years

of rich engineering and techno legal

experience in project execution , contract

management and planning . He was

previously employed with Gammon India

Limited in various capacities from Project

Manager to Vice –President projects.



a) Jobs under progress

Roads and Bridges

Project Name Location Client Scope of Work Value(Rs. in Crores)

Road Project in Jammu & Kashmir

Jammu & Kashmir National Highways Authority of India

Four-laning of Udhampur-Ramban section of NH - 1A in the state of Jammu and Kashmir.

1901

Elevated Road Corridor Bihar Bihar State Road Development Corporation Ltd

Construction of elevated road corridor from AIIMS (on NH-98) to Digha (on Ganga path) (11.90 km) at Patna in the State of Bihar on Engineering Procurement and Construction (EPC) mode.

1126

Hospet-Bellary Highway Project

Karnataka NHAI 4/6 Laning of Hospet-Bellary-Karnataka/AP Border Section. 95 km.

1025

Ludhiana Elevated Highway

Punjab NHAI Construction of Partially Access Controlled Four lane Elevated Highway between Samrala Chowk to Ludhiana Municipal Limit of NH-95, Punjab.

756

Maheshkunt Purnea Road project

Bihar NHAI Rehabilitation & upgradation of two laning of Maheshkhunt-Saharsa-Purnea Section of NH-107 from km 90.000 to 177.960 km in the state of Bihar on EPC mode (Package-II).

736

Elevated Road-cum-Flyover

Goa JV between NHAI, Indian Navy and Goa PWD

Construction, operation and maintenance of balance works for elevated road-cum-flyover-cum-ROB in the state of Goa.

501

Birpur-Udaikishangunj Road (SH-91)

Bihar BSRDC Improvement/Upgradation of Birpur-Balua-Jadia Meergunj-Murligunj-Udaikishangunj Road (SH-91) Length – 101.7 Km. Contract Package No. - 4 of BSHP-II.

425

Kamala Bridge Bihar Bihar Rajya Pul Nirman Nigam Ltd

Construction of 13.00km (approx) long extended portion of approach road of Baluaha Ghat Koshi Bridge.

258

Mahi Sabarmati Gujarat Dedicated Freight Corridor Corpration of India Ltd

Design & Construction of Special Steel Bridges across Mahi & Sabarmati River involving Bridge Structure, approaches - 150 m length (on both sides) on Ikbalgarh – Vododara section of Western Dedicated Freight Corridor.

165

Seppa Road Arunachal Pradesh PWD Arunachal Pradesh

81-Km road project of construction and improvement with Flexible pavement of 7.5 m under NEC.

162

KEY PROJECTS


Project Name Location Client Scope of Work Value (Rs. in Crores)

Water Treatment and Distribution projects

Rajasthan Rajasthan PHED 5 nos. water supply projects at different locations in Rajasthan- Gudamalani (263 villages), Tonk (436 villages), Chakshu (267 villages), Barmer (152 villages), Jawai (133 villages). Chaksu project was commissioned this financial year.

1106

Guwahati Water Supply

Assam Guwahati Met. Dev. Authority

Design and Construction of complete new 107 MLD capacity potable Water Supply Infrastructure Project on Turnkey basis for Guwahati City

410

Pedda Vagu Project Andhra Pradesh AP Irrigation Department

Construction of diversion scheme across Peddavagu project near Jagannathpur, Adilabad District.

152

Guwahati Water Supply

Assam Guwahati Met. Dev. Authority

Supply, Installation, Construction and Commissioining of Rising & Transmission Main Reservoirs for South Central Zone.

149


RVNL Kolkata- 7 stations

West Bengal RVNL Construction of Seven (07) Stations Including Related Works from Barun Sengupta to Bidhan Nagar in New Garia-Airport Metro Corridor of Kolkata metro Railway Line.

400

Kolkata Metro JSM-3 Stations

West Bengal RVNL Construction of Behala Bazar, Taratala and Majerhat Stations including all related works in Joka-BBD bag Corridor of Kolkatta Metro Railway line.

200

Water and Irrigation

Metro Rail



Bajoli Holi Hydro Electric Project

Himachal Pradesh GMR Bajoli Holi Hydropower Ltd

Civil works for Bajoli Holi Hydro-electric project.

861

Cooling Tower & CW System

Rajasthan Nuclear Power Corporation of India Ltd

Natural draught cooling towers and cooling water pump house package for RAPP 7 & 8 including allied works.

735

Bhutan HEP-2 Bhutan Punatsangchhu Hydroelectric Power Authority

Construction of Headrace Tunnel (HRT) from Adit I &Adit II.

554

Parbati HEP Lot PB2A Himachal Pradesh NHPC Construction of Balance Civil Works of HRT by TBM (Lot PB 2A) of Parbati HE Project-Stage-II.

509

Mangdechhu Hydroelectric Project

Bhutan Mangdechhu Hydroelectric Power Authority

Construction of head race tunnel including Construction Adits (I, II, III, IV&V) and Associated Works of HRT of Mangdechhu Hydroelectric Project Bhutan.

483

Vyasi hydroelectric project

Uttarakhand UJVN Limited Execution of civil works related to concrete dam, diversion works, intake and 1.35 Km HRT of Vyasi H.E. Project (120 MW) in District Dehradun.

318

Power


(B) RECENTLY COMPLETED JOBS/ JOBS NEARING COMPLETION


Signature Bridge New Delhi Delhi Tourism and Transport Development Corp Ltd

Construction of bridge and its approaches in River Yamuna downstream of existing bridge at Wazirabad, Delhi.

884

Patna - Muzaffarpur Road (BOT)

Bihar NHAI Four Laning of Hajipur-Muzaffarpur Section of NH-77.

786

Kalwakurthy Telangana IRRIGATION & CAD DEPT. , TELANGANA

Stage 3 Pumping station (5X30 MW) of Kalwakurthy Lift irrigation Scheme.

786

Gomti River Project Lucknow PWD, Lucknow Channelization of Gomti River from Harding Bridge to Weir.

701

Brahmaputra Bridge Assam Ministry of Road, Transport & Highways (MORTH)

Construction of New Brahmaputra Bridge on EPC basis in the state of Assam.

481

Tuticorin Tamil Nadu Coastal Energen Civil and structural steel works for 2 x 600 MW thermal power projects near Tuticorin.

337

Chaksu Water Distribution Project

Rajasthan PHED, Jaipur Design and Construction of Civil Works for Regional Water Supply Scheme to 267 villages.

224

Iskcon temple, Mayapur West Bengal ISKCON Construction of world’s largest temple dome with diameter of 54 m. and height of 68.5 m for ISKCON in Mayapur

140

Pawana River Bridge Maharashtra Pimpri Chinchwad Municipal Corp.

Design and Construction of Bridge on Pawana River.

116


(C) KEY PROJECT WINS IN FY 18


Contract Commencement Date

Contract Period (Months)

T-48 Tunnel Jammu & Kashmir IRCON Construction of balance works of tunnel T-48 on Katra- Banihal section of Udhampur-Srinagar-Baramulla New BG Railway Line Project.

1187

30th August 2017

39 Months

Varanasi Ring Road Phase-II

Uttar Pradesh NHAI Construction of 27.3 kms four-lane bypass connecting NH-29 with NH-2 as part of Varanasi Ring Road Phase-II Pkg-1.

949

13th February 2018 (LOA Date)

36 Months

Dolvi Maharashtra JSW Steel Ltd. Civil Works for plant capacity expansion project at Dolvi.

205 1st June 2017 27 months



OUR LANDMARK PROJECTS

TUNNEL T-48 R USBRL, JAMMU & KASHMIR

Construction of Balance works of Tunnel T-48 on

Katra-Banihal Section of Udhampur-Srinagar-

Baramulla New BG Railway Line (USBRL) Project is

located in Ramban district of Jammu and Kashmir.

Tunnel T-48 is 10.2Km long single line track tunnel

with parallel escape tunnel. The ingress into the tunnel

for construction is through 2 nos. of ADIT apart from

North Portal. The altitude varies from El. 1300 m to El.

2400 m along the alignment of tunnel T-48 (package

T-48R) at places. New Austrian Tunneling Method

(NATM) is being used for excavation of the tunnel.

SCOPE OF WORK

• Construction of balance works of tunnel T-48

(between KM 100+000 to 110+200 Approx.): Main

Tunnel- 5993.0 m long/ 7.9 m diameter & Escape

Tunnel- 6080.5 m long/ 5.2 m diameter concrete

lined horseshoe shaped Railway Tunnel.

• Motorable Cross Passage’s- 288 m; 16 Nos., South

Portal Cut & Cover.

• Concrete Lining: Main Tunnel- 9581.2 m, Escape

Tunnel- 9694.3 m, Adit-1125 m & Motorable Cross

Passage-432 m.


NH17B- GOA BRIDGE PROJECT SCOPE OF WORK:

Project consists of 5km elevated road and

2.8km at grade road with three Rail Over

Bridges and two ramps to connect Vasco city.

This bridge will be unique with drive in view

of Baina Beach and divert heavy traffic of port

and Indian oil beyond Vasco city.

• Bridge and at grade road carry 4 lane (2 in

each direction)

• Unique Cable stay bridge over existing over

bridge on curve alignment.

• This project will be link between air

transport and water transport.


PUNATSANGCHHU-II HYDRO ELECTRIC PROJECT, BHUTAN – 1020MW

SCOPE OF WORK

6.314 km long circular shape of 12.30m excavated head race tunnel of PHPA- II has aligned in subcontinent through area of wide

geological diversity and structural complexity of lesser Himalayan rocks. The HRT is passing through six major Tunnel grade units of

two rocks parametric and two major thrust in face-II RD- 530m and Face-IV at RD- 1145 to 1160 m.

The salient features are as under

• Length of Tunnel : 6.314 km

• Diameter of Tunnel : 11.0 m Finished

• Shape of Tunnel : Circular RCC Lined

• Design discharge : 460.0 m3/s

• Slope of Tunnel : 1 in 220.11

• Intermediate construction Adit : 02 nos. (7.5m x 7.5m D-shaped)



CONSTRUCTION OF SRI CHAITANAYA CHANDRODAYA MANDIR AND INDIAN EDUCATIONAL AND CULTURAL CENTER AT

ISKCON,MAYAPUR

The holy city of Mayapur in West Bengal is located on the

banks of the Ganges river. Mayapur is visited by over a million

pilgrims annually and serves as ISKCON’s international

headquarters

ISCKON has initiated a very ambitious project of developing

The Temple of Vedic Planetarium in Mayapur. The Temple

of the Vedic Planetarium will be a shining beacon for all the

aspiring spiritualists world over.

The Structure of temple is equally iconic as its purpose. It

is spread over 7 lakh Sq. Ft. and will be famously known for

its central dome, which is largest stainless steel RCC dome

of its kind in world. The construction of this iconic dome is

completed and temple is expected to be ready by 2022.

The Temple consist of three wings,

1st Wing is the Main Temple which adorns the largest dome

of 54 m diameter towering to height of 34m from Ring Beam.

It will house a 3-dimensional moving model of the universe

according to the Vedic scriptures.

2nd wing is placed with smaller dome atop which will be 27m

diameter and height of 17m.

The 3rd Wing is the Planetarium Wing where Vedic Cosmology

and Vedic description will be depicted.

The Temple’s Sub-Structure has used Stainless Steel

Reinforcement for insuring the life of 500 years. All domes

are constructed using stainless steel tubular sections with

Stainless Steel Reinforcement for RCC Works of 200mm

thickness. This tall and magnificent structure is erected with

the help of a massive 114 Meter tall tower crane.

The construction of the Temple of the Vedic planetarium will

benefit the local economy through job creation as well as by

attracting visitors from around the world which will support

local businesses.

Gammon takes the pride of being the erectors of this iconic

edifice, the Temple of Vedic Planetarium in Mayapur.


NATURAL DRAUGHT COOLING TOWERS AND COOLING WATER PUMP HOUSE PACKAGE FOR RAPP UNIT 7&8 INCLUDING ALLIED WORKS (RAWATBHATA,RAJASTHAN)

SCOPE OF WORK:

The work proposed under this contract shall be performed for Complete Conceptualization, Design, Engineering, construction,

manufacture, supply, erection, testing and commissioning of Natural Draught Cooling Towers, Cooling Water Pump House and

allied works for Rajasthan Atomic Power Project –units 7 & 8 each of 700 MW for Nuclear Power Corporation of India Limited at

Rawatbhata near Kota, Rajasthan State.

MAJOR ACTIVITIES:

1) Construction of 4 numbers NDCTs of 184.45m height and auxiliaries including supply of all required equipments along with

construction, inspection and testing of cold water gravity tunnels from NDCT cold water basin to CWPH forebay.

2) Construction of 2 numbers CWPH’s, each of Capacity 1,48,800 M3/Hr and auxiliaries including supply of all required

equipments.

3) Cement Mortar Lined & Coated (CMLC) Pipe Line for Hot Water transport from Turbine Building to NDCTs and Cold Water

from Cooling Water Pump House to Turbine Building - 2700 Rmt.

4) Auxiliary cooling cold water transported through pipeline from Cooling Water Pump Houses to terminal point at entry to

Control building and turbine building – 1200 Rmt

5) Excavation of more than 4,10,000 Cum of HARD ROCK by Controlled blasting and Backfilling of quantum 11,00,000 Cum.

PROGRESS PHOTOGRAPHS:



PAWANA BRIDGE PROJECT

Design and Construction of Bridge on Pawana River, Flyover/Viaduct & ROB with approaches & Ramps on Kalewadi Phata to Dehu

Alandi Road:

SCOPE OF WORK:

Description Nos

Foundations (Piling/Open Foundation) 104

Substructure (Pier & Piercap) 104

Cast in situ/ Segmental Span/ROB span 101

Civil Works- Segmental Bridge along with cast in situ span over river portion and Structural steel girders over ROB span

Electric Works : Installation of over 350 lighting and LED fittings over and below flyover



HEALTH, SAFETY& ENVIRONMENT

Health Safety and Environment is a prime and integral part

of the Company and is an important parameter defining the

vision, mission and goals. GECPL is one of the few Construction

companies certified on IMS complying with ISO 9001, ISO 14001

and OSHAS 18001- now getting converted to ISO 45001.As far as

HSE management is concerned, the Company follows all standard

norms and models for its proactive analysis and implementation.

At GECPL, the management is fully involved on safety matters.

A well-structured safety organization reporting to the top

management controls the safety management and accident

prevention works through a structured regional concept for

controlling its large number of projects spread across the various

parts of the country.



Amongst others, some of the best Safety practices followed

are listed below:

• Corporate safety Committee meetings, Weekly senior

management review of Safety status of Projects, issue of

monthly Business Safety Performance Review Reports are

all important aspects of the Safety management program

of the Company

• Safety induction covers all new employees including

workers, transferees etc.

• Daily safety surveys and surveillance followed with

periodical safety inspections and safety audits, IMS Audits

etc.

• A well organized and updated Document Management

System (DMS) covering all aspects of HSE, P&M, and Admin

and so on uploaded on the Gammon portal for each site

to access and use. These include various management

practices, guidelines, HIRAC and so on with relevant check

lists.

• Periodical Reports from Projects on Monthly Safety

Performance, MoM of the Project Level safety committee

meetings, labour camp inspection, Safety Related

Deficiency (SRD) Reports etc.

• A legal register is maintained on all projects sites to ensure

compliance with the statutory requirements

• Safety training is given high importance and impetus and

all the avenues are utilized in imparting Safety training like

class room training, on the job training, specialized training

externally arranged safety training and safety training

through Video Conference (VC).

• Leading from the top is an important aspect in building

and enhancing Safety Culture and on this a Safety Walk

with the Project Manager is conducted regularly by Safety

in charge. Also, the business heads address safety issues

during regular site visits.

• The live HSE statistics of the company is uploaded on the

Gammon portal through daily inputs from Projects.

Safety Promotion, Safety motivation and Safety propagations

are all given highest priority in continually building up

Safety awareness. In this direction, the Vice Chairman’s Safety

certificate for achieving more than 5 million Accident free

Man-hours is awarded to the winning Projects.

Based on the overall policy and safety management

techniques, a number of Project Sites have acquired

continuous accident free million man hours as listed below:

• Hospet Bellary - 32.33

• Bajoli Holi - 8.4

• RAPP NDCT - 7.07

• K Kalpakkam - 5.75

• 8 Vallur TPP - 5.68

• Goa Bridge - 3.22

• Mahi Sabarmati - 2.72

• Punatsangchhu Bhutan - 2.64

• Signature Bridge - 2.55


ENGINEERING DESIGN AND CONSTRUCTION TECHNOLOGY CENTRE (EDCTC)The Company has a rich tradition of carrying out in-house

design for both permanent structures as well as construction

process which is responsible for pioneering technologies in

the country. Some of the pioneering works are;

• Introduction of Slip Form Technology in India.

• Introduction of Jump Form Technology in India.

• Development of concrete technology.

• Cast-in-situ as well as precast segmental construction of

bridges for both span by span construction and cantilever

construction.

• First time construction of Tallest Chimney and Natural

Draught Cooling Towers, Longest Span Bridges.

• Introduction of cable supported bridges for the first time in

India including cable stay and extra dozed bridges.

• Development of high performance concrete in the country

and application of M75 grade concrete for the first time in

India.

• High volume replacement of cement with mineral

admixtures like Flyash, GGBFS, Alcofine and Silica fume

including replacement of aggregates with ash and slag

aggregates thereby furthering the cause of sustainability in

the country.

The Company also has been recognized as a R&D center

for Applied Research by the Department of Science and

Technology of the Ministry of Science. Apart from receiving

more than 50 awards for its contribution to Civil Engineering

from almost all Civil Engineering Institutions of the country,

Gammon has produced more than six Fellows of Indian

National Academy of Engineering for the distinguished

contribution to Civil Engineering in nation building.

The EDCTC has been sub-structured into four sections viz.;

• Engineering Design Management Section (EDMS)

• Construction Process Design Section (CPDS)

• Electromechanical Designs and Procurement.

• R&D, Repairs and QC.

The above engineering sections are headed by well

qualified engineers and supported by latest Software, Data

Management and Archive Systems and Technical Library

which is continuously updated in the field of Design and

Technology. The entire engineering is mentored by Dr. N.V.

Nayak who is an author of four books on concrete technology

and geotechnical engineering, in addition to perpetual

knowledge updation of engineers by way of participating in

Conferences and Codal Committees.

EDCTC continues to seek technological expressions in the

shrine of Gammon Construction.



INTEGRATED MANAGEMENT SYSTEM

In order to sustain competitive advantage, businesses need

to adapt to meet the growing needs of customers. The

Company’s management systems are compliant with the

revised ISO 9001 and ISO 14001 standards. We are in the

process of obtaining certification under ISO 9001, ISO 14001

and OHSAS 18001 standards. The scope of this IMS covers

‘Design and Engineering of Civil Engineering Structures and

Pipeline Projects in India and Abroad’.

The Company’s IMS addresses its commitments to comply

with the needs and expectations of its interested parties,

applicable standards, and applicable legal requirements.

The IMS establishes a planned and controlled framework

to identify risks, control risks, assess effectiveness of

these controls and improve the management of quality,

occupational health & safety, and environment. By

establishing this IMS, GECPL aims to:

• Provide assurance to customers that its products and

services will meet customer’s specified requirements,


• Ensure that personnel working on site, members of public

and visitors to site are adequately protected from risk of

injury or illness, and

• Ensure that appropriate environmental protection

measures are implemented within work areas.

The IMS incorporates provisions to ensure that all employees

shall be made aware of its constituent process definition and

descriptions. The Company has appointed its Head (IMS) as

“Corporate Management Representative (MR)” who reports

to top management on the progress of IMS implementation.

Further, in order to assist the MR in discharge of his

responsibilities, the Management of each Site appoints a Site

Management Representative (SMR) at each project, and at

each workshop.

The MR ensures that the IMS is documented, established,

implemented and maintained, consistent with requirements

of ISO 9001, ISO 14001 and OHSAS 18001, and reports to

senior management on the performance of IMS including

recommendations for improvement.


CONTROLS AND SYSTEMS

GECPL has established a management system to comply with

applicable requirements, standards, and legal requirements,

related to quality, occupational health, safety and environment.

Through management system, The Company aims to:

• Assure customers that GECPL’s products and services will meet

their specified requirements,

• Ensure that personnel working on site, members of public, and

visitors to site are adequately protected from risk of injury or

illness, and

• Ensure that appropriate environmental protection measures

are implemented on works undertaken within work areas.

The management systems ensure that all operations which

directly affect quality, safety and environment are identified

and planned to ensure that they are carried out under planned

and controlled conditions. It establishes a framework to identify

risks, control risks, assess effectiveness of these controls and

improve management of quality, occupational health & safety

and environment. This includes processes to identify, control and

review, OH&S and environmental risks over which it has control or

influence. The process identifies safety controls and environment

protection measures that must be put in place to minimize

identified risks. These controls and measures are developed in

consultation with site personnel and represent the safest, most

practical way of carrying out work activity and fulfill any specific

project safety requirements or environmental aspects. The project

management team is responsible for the development of such



operational control procedures. Existing operational control

procedures and method statements are amended, or additional

procedures issued, as may be necessary, to address changes in the

risk portfolio. Similarly, registers of applicable legal requirements

are compiled, and their compliance tracked on an electronic

database centrally accessible by concerned personnel.

For processes, which directly cannot be measured for their

acceptance (e.g. concreting, welding, complex computer-

programs, use of ground anchors, etc.), the Project Head along

with customer, defines the process of qualification of product

i.e. the personnel, workmen and processes of execution etc. The

results of these validations are kept as a record so that it can be

referred at later stage.

The management system also incorporates provisions for product

identification and traceability and to positively indicate the

conformance or non-conformance of a product and/or process

with regard to inspection and tests performed.

The organization implements provisions to ensure that all GECPL

employees shall be made aware on how to respond and behave

in an emergency situation. Necessary information in this regard is

readily available and posted at appropriate locations in the office

and at project sites.

GECPL conducts emergency drill at regular intervals, at all its

premises, including project sites, with an aim to periodically review

its emergency preparedness and response.

GECPL monitors conformity to its established benchmarks

for process performance. These benchmarks are based on

standards required by customers, as well as industry standards.

Compliance to requirements of contracts, standards, law, statutes,

regulations and other requirements related to project, OH&S, and

environment, are evaluated periodically by concerned HOD and

project managers. Such leadership personnel and designated

personnel ensure that elements related to following areas are

monitored at defined intervals:

• Significant hazards; environmental aspects; and legal

requirements

• Process efficiency

• Product quality

• Customer satisfaction

• Monitoring agency, methods and instruments

• System compliance

These involve internal audits, management reviews, inspections,

tests, calibrations, performance assessments of employees and

sub-contractors, audits by external agencies, incident reporting,

and customer satisfaction surveys.

The results of monitoring, decisions and actions are recorded.

GECPL monitors conformity to its established benchmarks for process performance. These benchmarks are based on standards required by customers, as well as industry standards. Compliance to requirements of contracts, standards, law, statutes, regulations and other requirements related to project, OH&S, and environment, are evaluated periodically by concerned HOD and project managers.



AWARDS ANDACCOLADES

RAPP- Housekeeping Award

Safety Recognition Certificates Safety Recognition Certificates

Vallur sites Best Safety Performance Award


DIRECTORS’ REPORTTo,The Shareholders ofGAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITEDYour Directors have pleasure in presenting their 4th Annual Report, together with the Audited Financial Statements of the Company for the financial year ended 31st March, 2018.1. REVIEW OF PERFORMANCE The year under review is a 12 (Twelve) months period

commencing from 1st April, 2017 and ending on 31st March, 2018.

I. FINANCIAL HIGHLIGHTS (Rs. in Crores)

Particulars For the Finan-cial Year ended March 31, 2018

Previous Year ended March

31, 2017Total Income 2,316.81 1,559.25Total Expenditure 1,978.68 1,256.37Profit before Depreciation and Interest

338.13 302.88

Less:Depreciation 98.36 70.07Interest 266.20 162.92Profit/(Loss) before Tax (26.43) 69.89Less:Provision for Taxation 49.89 68.17Deferred Tax Liability/(Asset) (82.09) (46.99)Profit/(Loss) after Tax 5.77 48.71

Profit/(Loss) for the year 5.77 48.71Add:Profit brought forward from the previous year

46.86

Available for Appropriation

52.63 48.71

Appropriations:Creation of Debenture Redemption Reserve

0.06 (1.55)

OCI Appropriation 0.12 (0.31)EPS –Basic 2.04 22.67Diluted 2.04 22.67Balance carried to Balance Sheet

52.81 46.85

The year under review is the first full year of operations post acquisition of the Civil EPC Business. During the year under review the Turnover of the Company stood at Rs. 2282.61 Crores and other income is Rs. 34.20 Crores as compared to the turnover of Rs. 1554.08 Crores and other income was Rs. 5.17 Crores during the previous year ended 31st March, 2017. The Company posted a Net Profit after Tax of Rs. 5.77 Crores during the year ended 31st March, 2018, as against a Net profit after Tax of Rs. 48.71 Crores during the previous year ended 31st March, 2017.

The Turnover and Profitability of the Company was largely impacted due to slow pace of execution of the projects as well as implementation of the Goods and Services Tax Act effective from 1st July, 2017.

The Company has been focusing on reorganization of the Civil EPC Business. The Company has also been successful in recovering arbitration awards worth Rs. 60 Crores during the year and getting arbitral awards worth Rs. 350 Crores.

The Company has been bidding aggressively for various projects. The Government of India is taking every possible initiative to boost the infrastructure sector. The initiatives taken by the government in every construction sector will provide the Company considerable business opportunities and the Company hopes to bag several projects in the current year. During the year the Company won new projects valued at Rs. 4,200 Crores and the Order book as of March 31, 2018 stands at Rs. 9,939 Crores, which is well diversified across sectors and geographies.

II. REVIEW OF OPERATIONS AND FUTURE OUTLOOK INDIAN ECONOMY India’s economy is forecast to grow 7.4% from 6.7% in F.Y. 18

and accelerate further in F.Y. 20 to 7.8%, which is unchanged from its earlier outlook. There will be a gradual increase in India’s growth rate as structural reforms raise potential output, as foreseen by IMF in its flagship World Economic Outlook. This year India is expected to overtake China to become the fastest growing major economy in the world.

However, the banking system is undergoing a turbulent period with rising NPAs, consolidation at PSUs and recent scams leading to slow decision making and risk aversion impacting timely credit availability to infrastructure sector. Indian banks’ gross non-performing assets (NPAs), or bad loans, stood at Rs. 10.25 Lakh Crore as on 31st March, 2018 which accounts for 11.8% of the total loans given by the banking industry. For financial year 2018, the total bad loans of these banks rose by Rs. 3.13 Lakh Crore.

Also, certain macro-economic factors such as protectionist measures adopted by some countries especially the USA and rising crude oil prices could impact global and Indian economy and result in higher inflation and rising input costs in medium term.

The Construction industry in India is expected to grow at 5.6% during 2016-20, compared to 2.9% during 2011-15. The sector was the second largest employer in India in 2017. The industry contributes 55% share in the Steel industry, 15% in the Paint industry and 30% in the Glass industry. India will be required to spend $ 454.8 billion on infrastructure development over the period of five years (2015-20), with 70% of funds needed for power, roads and urban infrastructure segments. The sector wise performance of the Company as well as future outlook is enumerated below.

ROADS India has the second largest road network across the world at

5.23 million km. This road network transports more than 60%


of all goods in the country and 85% of India’s total passenger traffic. The road transport sector contributes around 4.7% of the GDP and is a major contributor to employment. The construction of highways reached 122,432 km during F.Y. 2017-18 which was a record for a single year. In F.Y. 18, about 27.5 km of highways were constructed each day and an average 46 km per day of road contracts were awarded. Total length of roads constructed under Prime Minister’s Gram Sadak Yojana (PMGSY) was 47,447 km in 2017-18. Ministry of Road Transport & Highways, Govt. of India has proposed a target to award construction of 20,000 kms of roads and completing the construction of 16,418 kms during 2018-19. Furthermore, implementation of Hybrid Annuity Model (HAM) in Public Private Partnership (PPP) projects in roads and highways sector in the country is expected to increase private participation in the sector and ease many of the bottlenecks faced by companies in the past. The Government has set aside around Rs. 1 Lakh Crore (US $15.26 billion) during F.Y. 18-20 for road building projects under Pradhan Mantri Gram Sadak Yojana (PMGSY). The Government of India will invest Rs. 7 trillion (US $107.82 billion) for construction of new roads and highways over the next five years. Rs. 2 Lakh Crore expected expenditure on National highways in 2019.

Some of the major ongoing road projects of the Company include:

Project Name

Location Client Scope of Work

Road Project in Jammu & Kashmir.

Jammu & Kashmir

National Highways Authority of India

Four-laning of Udham-pur-Ramban section of NH - 1A in the state of Jammu and Kashmir.

Hos-pet-Bel-lary Highway Project.

Karnataka NHAI 4/6 Laning of Hospet-Bel-lary-Karnataka/AP Border Section 95 km.

Ludhiana Elevated Highway.

Punjab NHAI Construction of Partially Access Controlled Four lane Elevated Highway between Samrala Chowk to Ludhiana Municipal Limit of NH-95, Punjab.

Seppa Road.

Arunachal Pradesh

PWD Arunachal Pradesh

81-Km road project of construction and im-provement with Flexible pavement of 7.5 m under NEC.

Varanasi Ring Road Phase-II.

Uttar Pradesh

NHAI Construction of 27.3 kms four-lane bypass con-necting NH-29 with NH-2 as part of Varanasi Ring Road Phase-II Pkg-1.

The roads & bridges sector contributed 31% in terms of revenue during F.Y. 2017-18 and the share in order book from this sector is 45%.

Bridges, Flyovers, Metro & Railway India plans to develop metro rail projects in over 30 Indian

cities. Currently, the metro rail network is operational or partly operational in nine cities and another five cities are under-implementation. ICRA estimates that the overall cost of expansion of operational and under implementation approved metro projects is over Rs. 2.5 Lakh Crores.

In the Union Budget 2018, the Centre has set aside over Rs. 14, 264 Crore for metro projects across the country, which is a cut of nearly 20% over last year’s allocation. The Metro Rail Policy, 2017 makes private sector participation mandatory giving a thrust to private sector participation. The Budget has made allocations for metro rail in Delhi, Chennai, Bengaluru, Ahmedabad, Nagpur, Mumbai, Kochi and Lucknow for a total of 342 km.

In the current year the Company focused on execution of its Kolkata Metro Station projects under RVNL for construction of 7 stations on New Garia - Airport Metro Line and 3 stations on Joka-BBD Bag Metro Line. During the year the Company also won a major project for Construction of balance works of tunnel T-48 on Katra-Banihal section of Udhampur-Srinagar-Baramulla New BG Railway Line Project from IRCON for Rs. 1,187 Crores on which execution is in full swing.

Some of the major ongoing bridge projects include:

Project Name

Loca-tion

Client Scope of Work

Elevated Road-cum-Flyover.

Goa JV between NHAI, Indian Navy and Goa PWD.

Construction, operation and maintenance of balance works for elevated road-cum-flyover-cum-ROB in the state of Goa.

Elevated Road Corridor.

Bihar Bihar State Road Development Corporation Ltd.

Construction of elevated road corridor from AIIMS (on NH-98) to Digha (on Ganga path) (11.90 km) at Patna in the State of Bihar on Engineering Procurement and Construction (EPC) mode.

Brahma-putra Bridge.

Assam Ministry of Road, Transport & Highways (MORTH)

Construction of New Brahmaputra Bridge on EPC basis in the state of Assam.

Kamala Bridge.

Bihar Bihar Rajya Pul Nirman Nigam Ltd.

Construction of 13.00 km (approx.) long ex-tended portion of ap-proach road of Baluaha Ghat Koshi Bridge.

Mahi Sa-barmati.

Gujarat Dedicated Freight Corridor Corporation of India Ltd.

Design and Construc-tion of special steel bridges across Mahi and Sabaramati River.


The metro and railway sector contributed 29 percent in terms of revenue during F.Y. 2018 and the share in order book from this sector is 26%.

Water and Irrigation In the Union Budget 2018-19, Finance Ministry allocated

Rs. 22356.60 Crore to the Union Drinking Water and Sanitation Ministry for 2018-19, a 11.72% jump over the previous year’s Rs. 20010.79 Crore. The Union Government has announced the National river linking project: A largest of its kind project in the world. This project aims to bolster irrigation levels in agriculture by moving 178 billion cubic meters of water across river basin boundaries each year by building a 12,500 kilometer-long water conveyance network, benefiting 220 million Indians.

The National Rural Drinking Water Programme (NRDWP) is a flagship program of the Government of India with the objective of assisting States to provide safe & adequate drinking water supply mainly through piped water supply in all rural areas. A new and more comprehensive AMRUT scheme focuses on providing water supply to all households in 500 cities.

During the year, the Company commissioned a project for Regional water supply scheme for 267 villages of Chaksu and eight villages of Phagi tehsil in Rajasthan for PHED, Rajasthan.

The following water supply projects are currently under various stages of execution:1. Narmada Gudhamalani water supply project for 263

villages involving the construction of RWR, water treatment plant and related civil, mechanical, electrical and instrumentation works at various pumping stations on a turnkey basis.

2. Supply, installation, construction and commissioning of rising and transmission mains for Guwahati city (gravity and pressure mains) reservoirs for South Central Zone

3. Tank water supply project for 436 villages in Rajasthan for PHED, Rajasthan.

4. Pokharan water supply scheme for 152 villages for PHED, Rajasthan.

5. Jawai water supply scheme for 133 villages for PHED, Rajasthan.

The water and irrigation sector contributed 12% in terms of revenue during F.Y. 2018 and the share in order book from this sector is 7%.

Hydro Power The government has revised downwards the proposed size

of the Centre’s funding of hydro power projects by way of 4% interest subvention by 34% to Rs. 11,049 Crore for the 2018-2028 period. In order to help revive stalled hydro power projects, the Govt. is expected to announce a new hydropower policy which will mandate a Hydropower purchase obligation on power distribution companies. The Company’s key client in hydro power, NHPC, is in the process of obtaining clearances for six prospective projects having planned capacity of 5,795 MW. It is also envisaging hydropower projects having planned capacity of 1,934 MW through Joint ventures.

During the period under review, the Company focused on executing its existing projects which included:1. GMR Bajoli Holi- LOT I – Construction of coffer dams,

diversion tunnel and concrete dam including spillway, power intake, part HRT and construction adits.

2. GMR Bajoli Holi- LOT II – Construction of HRT of about 9.63-km length, surge shaft, valve chamber, pressure shaft including steel liner, surface powerhouse, TRC, construction adits and pothead yard.

3. Vyasi Dam- Execution of civil works related to concrete dam, diversion works, intake and 1.35-km HRT of Vyasi H.E. project (120 MW) in District Dehradun, Uttarakhand.

4. Parbati 2A (joint venture with CMC, Italy)- Construction of balance civil works of HRT by TBM (Lot PB 2A) of Parbati H.E. project, stage-II.

5. Punatsangchhu HEP II, Bhutan- Punatsangchhu-II H.E. project (990 MW) contract package C-2 construction of head race tunnel from Adit-I and Adit-II.

6. Mangdechhu Hydroelectric Project- Construction of headrace tunnel including construction of adits (I, II, III and IV) and associated works of HRT Mangdechhu H.E. project, Bhutan.

The hydro power sector contributed 22% in terms of revenue during F.Y. 2017-18 and the share in order book from this sector is 12%.

Power and Industrial Sector (Including Cooling Towers and Chimneys)

With increasing focus on power capacity addition via renewable energy, thermal and nuclear capacity addition in India remains low. Thermal power sector continues to be in severe financial stress. Delays in project implementation due to challenges such as land acquisition, approval of required permits and environmental clearances have all resulted in cost overruns. The prices of imported coal have doubled since 2016 and lack of suitable linkage of domestic coal production to power plant remains a huge challenge. As solar and wind power tariffs match and in many cases are below thermal energy prices, Coal-fired power is increasingly losing market share as states are rightfully opting for the cheaper renewable energy option.

The Company has its presence across almost all the various segments of power plant construction including water circulation system, cooling towers, chimneys, civil works and coal systems, among others.

Our focus during the period under review was to ensure the completion of ongoing and existing power projects in our portfolio including the Induced Draft Cooling Tower project for Rajasthan Atomic Power Project (RAPP) 7 and 8. We also worked towards reviving stalled projects enhancing collection of receivables and retention.

The power and industrials sector contributed 6% in terms of revenue during F.Y. 2017-18 and the share in order book from this sector is 9%.


2. DIVIDEND Though the Company has earned profits during the year

under review, the Board has decided to conserve the resources and has not recommended any dividend for the financial year ended 31st March, 2018.

3. TRANSFER TO RESERVES No amount was transferred to the reserves for the financial

year ended 31st March, 2018.4. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE

FINANCIAL POSITION OF THE COMPANY BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT

There are no material changes and commitments affecting the financial position of the Company between the end of the financial year and date of the report.

5. CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION, FOREIGN EXCHANGE EARNINGS & OUTGO

Pursuant to the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 the information on conservation of energy, technology absorption and foreign exchange earnings and outgo is enclosed as “Annexure A” to this report.

6. PARTICULARS OF EMPLOYEES Information required pursuant to Rule 5(2) of the Companies

(Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed as “Annexure B” to this Report.

7. DIRECTORS’ RESPONSIBILITY STATEMENT In accordance with Section 134(5) of the Companies Act,

2013, the Directors to the best of their knowledge and ability confirm that:i. in the preparation of the annual accounts, the applicable

accounting standards had been followed along with proper explanation relating to material departures;

ii. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. they have prepared the annual accounts on a going concern basis;

v. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

8. CHANGES IN BOARD COMPOSITION During the year under review Mr. Mahendra Shah,

Non-Executive Director resigned from the Board on 3rd July, 2017.

Mr. Abhijit Rajan was appointed as an Additional Director designated as a Non-Executive Chairman with effect from 5th May, 2017 and resigned from the Board on 17th August, 2017.

Mr. Vardhan Dharkar was appointed as a Whole-time Director, designated as Director- Finance effective from 10th August, 2017.

Mr. Naval Choudhary resigned as Director of the Company on 17th August, 2017.

Mr. Ganesh Shiva Ganesh who was appointed as an Additional Non-Executive Director w.e.f. 5th February, 2018, resigned as Director of the Company on 26th April, 2018.

Mr. Kirit Shah and Mr. Khushroo Wadia were appointed as Additional Non-Executive Directors of the Company with effect from 27th April, 2018. Mr. Kirit Shah was nominated by Gateway Infra Holdings Pte. Limited (a GP Group Company - Investor) and Mr. Khushroo Wadia was nominated by the Board of Christiani and Nielsen (Thai) Public Co. Ltd. (a GP Group Company). Both Mr. Shah and Mr. Wadia hold office until the conclusion of this 4th Annual General Meeting and being eligible have given their consent to their appointment as Directors of the Company. The Board recommends to the shareholders the appointment of Mr. Kirit Shah and Mr. Khushroo Wadia as Directors of the Company designated as Non-Executive Directors.

Pursuant to Article 45 of the Articles of Association of the Company, the Directors of the Company are not liable to retire by rotation.

9. NUMBER OF MEETINGS OF THE BOARD During the financial year ended 31st March, 2018, 20 (Twenty)

meetings of the Board of Directors were held on 7th April, 2017, 5th May, 2017, 7th June, 2017, 5th July, 2017, 10th August, 2017, 18th August, 2017, 4th December, 2017, 30th January, 2018, 5th February, 2018, 5th March, 2018, 14th March, 2018, 15th March, 2018, 15th March, 2018, 16th March, 2018, 17th March, 2018, 20th March, 2018, 27th March, 2018, 29th March, 2018, 31st March, 2018 and 31st March, 2018.

The intervening gap between any two meetings was not more than 120 days as prescribed under the Companies Act, 2013. Details of attendance of Directors at the said Board meetings are as under:

Name of Director (s) Number of Meetings held

Attended

Mr. Vimal Kaushik 20 11Mr. Venakataramana Heggade 20 20Mr. Naval Chaudhary * 20 5Mr. Mahendra U Shah ** 20 0Mr. Abhijit Rajan *** 20 3Mr. Vardhan Dharkar **** 20 15Mr. Ganesh Shiva Ganesh ***** 20 0Mr. Kirit Shah # 20 NAMr. Khushroo Wadia # 20 NA

* Resigned on 17th August, 2017.** Resigned on 3rd July, 2017.


*** Appointed on 5th May, 2017 and resigned on 17th August, 2017.

**** Appointed on 10th August, 2017.***** Appointed on 5th February, 2018 and resigned on

26th April, 2018.# Appointed on 27th April, 2018.

10. AUDITORS In the 3rd Annual General Meeting of the Company held on

28th September, 2017, M/s. Natvarlal Vepari & Co. Chartered Accountants (Firm Registration No. 106971W) were appointed as the Statutory Auditors of the Company for a period of 5 (Five) years to hold office from the conclusion of the 3rd Annual General Meeting until the conclusion of the 8th Annual General Meeting, subject to ratification at each Annual General Meeting.

Vide Notification dated 7th May, 2018 issued by the Ministry of Corporate Affairs , the requirement of seeking ratification of appointment of statutory auditors by members at each Annual General Meeting has been done away with. Accordingly, no such item has been considered in the Notice of the 4th Annual General Meeting.

11. AUDITORS’ REPORT There are no qualifications, or adverse remarks made by the

Statutory Auditor’s in their Report on the Audited Financial Statements for the year ended 31st March, 2018.

12. COST AUDITORS In accordance with the provisions of Section 148 of the

Companies Act, 2013, the Board of Directors of the Company had appointed Mr. R. Srinivasaraghavan, Cost Accountants (Firm Registration no. 100098) as the Cost Auditor for auditing the cost accounting records of the Company for the financial year ended 31st March, 2018 on a remuneration of Rs. 1,50,000 (Rupees One Lakh and Fifty Thousand only) plus applicable taxes and out of pocket expenses which has been ratified by the shareholders.

Further Mr. R. Srinivasaraghavan has been appointed as the Cost Auditor for auditing the cost accounting records of the Company for the financial year ended 31st March, 2019 on a remuneration of Rs. 1,50,000 (Rupees One Lakh and Fifty Thousand only) plus applicable taxes and out of pocket expenses . In terms of the provisions of Section 148 (3) of the Companies Act, 2013 read with Rule 14 (a)(ii) of the Companies (Audit and Auditors) Rules 2014, the remuneration of the Cost Auditor for the financial year 2018-19 is sought to be ratified by the members at the ensuing Annual General Meeting.

13. DEPOSITS The Company has not accepted any deposits covered under

Chapter V of the Act during the year under review.14. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE

REGULATORS OR COURTS No significant and material orders have been passed by any

regulator or any of the Courts during the financial year ended 31st March, 2018.

15. CAPITAL STRUCTURE During the year under review the Authorized Share Capital of

the Company was increased from Rs. 9,60,00,000/- (Rupees Nine Crore Sixty Lakhs only) divided into 96,00,000 (Ninety Six Lakhs) equity shares of Rs. 10/- each to Rs. 58,00,00,000/- (Rupees Fifty Eight Crores only) divided into 5,80,00,000 (Five Crore Eighty Lakhs) equity shares of Rs. 10/- each vide a special resolution passed on 3rd April, 2017.

Further, during the said period the paid-up share capital of the Company also increased from Rs. 9,60,00,000/- (Rupees Nine Crore Sixty Lakhs only) divided into 96,00,000 (Ninety Six Lakhs) equity shares of Rs. 10/- each to Rs. 57,14,57,150/- (Rupees Fifty Seven Crores Fourteen Lakhs Fifty Seven Thousand One Hundred and Fifty only) divided into 5,71,45,715 (Five Crore Seventy One Lakhs Forty Five Thousand Seven Hundred and Fifteen) Equity Shares of Rs. 10/- each on account of allotments made from time to time to Investors pursuant to the Investment cum Shareholders Agreements. The details of allotments made during the year ended 31st March, 2018 are as follows:

Sr. no.

Date of Allot-ment

Name of the Allottee No. of shares allotted

1 7th June, 2017 Gateway Infra Holdings Pte. Ltd

77,14,286

2 5th March, 2018 Gammon India Limited 1,18,85,7143 14th March,

2018Ajanma Holdings Private Limited

28,57,143

4 15th March, 2018

Ajanma Holdings Private Limited

31,42,858

5 17th March, 2018

Kaygee Investments Private Limited

7,14,286

6 17th March, 2018

Mr. Premchand Godha 7,14,286

7 27th March, 2018

Christiani & Nielsen (Thai) Public Co. Ltd.

60,00,000

8 29th March, 2018

Gateway Infra Holdings Pte. Ltd

70,00,000

9 29th March, 2018

Ajanma Holdings Private Limited

28,57,143

10 31st March 2018 Ajanma Holdings Private Limited

34,28,572

11 31st March 2018 Designated employees and Identified persons

12,31,427

Further the Company increased its authorised share capital from Rs. 58,00,00,000/- (Rupees Fifty Eight Crores only) divided into 5,80,00,000 (Five Crores Eighty Lakhs) equity shares of Rs. 10/- each to Rs. 125,00,00,000 (Rupees One Hundred and Twenty Five Crores only) divided into 12,50,00,000 (Twelve Crores Fifty Lakhs) Equity Shares of Rs. 10/- each vide a special resolution passed on 11th September, 2018.

16. RISK MANAGEMENT All activities undertaken by GECPL carry an element of risk,

which needs to be managed. The Committee of Sponsoring Organisations of the Treadway Commission (COSO) broadly


defines Enterprise Risk Management (ERM) as a process, effected by an entity’s board of directors, management and other personnel, applied in strategy-setting and across the enterprise, designed to identify potential events that may affect the entity, and manage risks to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives. Controlling risk exposure through the effective management of risk has always been an essential part of the Company’s approach to business and is accordingly integrated into its planning, execution and reporting processes.

The risks in business can be broadly categorised as under:• StrategicRisksareassociatedwiththeprimarylong-term

purpose, objectives and direction of the business.• Operational Risks are associated with the on-going,

day-to-day operations of the enterprise.• FinancialRisks are related specifically to theprocesses,

techniques and instruments utilised to manage the finances of the Company, as well as those processes involved in sustaining effective financial relationships with customers and third parties.

• KnowledgeRisks are associatedwith themanagementand protection of knowledge and information within the Company.

The major risks under these categories are spread across the entire spectrum of business activity and include timely execution of projects; bidding and tendering; timely collections; meeting payment obligations; timely completion of projects in hostile conditions; high working capital requirements; changing labour regulations; price variations; litigations; and settlement of claims. Identification of risks and risk events and their relationships are defined after discussion with the risk owners and secondary analysis of related data, previous audit reports and past occurrences of risk events.

The Company tries to continually sharpen its risk management systems and processes in line with industry standards and a rapidly changing business environment. GECPL’s business processes are certified as complying with ISO 9001:2015 Quality Standards, which incorporate, inter alia, the recognition and management of business risk. The Risk Management Policy in force incorporates a tiered governance structure with clearly defined roles and responsibilities, to ensure that risks are identified, assessed, handled, monitored and reported on a continuous basis.

To facilitate regular monitoring and review, all major business processes and their inherent risks and controls have been comprehensively documented. Risks are periodically tested and reviewed through operational reviews and internal audits, and the outcomes and remediation plans of such testing are periodically assessed by the Management Committee. Reporting and remediation of the organisation’s risks is built into the management review process and comprises reporting and analysis of adverse events, risk awareness workshops and annual risk reviews.

17. INTERNAL FINANCIAL CONTROLS & THEIR ADEQUACY The organisation’s risk management Framework and the

business planning & review process provide the foundation

for the Internal Financial Controls with reference to the Company’s financial statements. The Company recognises that any internal control framework, no matter how well designed, has inherent limitations and accordingly, the Company’s internal control systems are regularly reviewed, audited and updated.

The features of the internal financial control framework include the following:- Comprehensive procedures and policies have been

laid down to guide the operations of the business. Project / functional heads are responsible for ensuring compliance with these policies and procedures.

- There exists a structured authorisation matrix for financial approvals.

- The Company’s internal control systems are routinely tested by the Statutory Auditors and Internal Auditors.

- The Company uses ERP systems as a business enabler and also to maintain its books of account. The transactional controls and checks built into these systems ensure appropriate segregation of duties, a tiered approval matrix, an audit trail and the maintenance of supporting documentation.

The Internal Audit function of the company comprises of professionally qualified accountants, engineers and IT specialists, and is appropriately skilled to deliver the right degree of audit assurance. The Department prepares and executes a detailed annual internal audit plan that is approved by the Management Committee. Internal Audit primarily focuses on the adequacy of appropriate systems and controls, the status of statutory compliance and the efficiency of cost optimisation and revenue management. Over and above systemic, financial and statutory checkpoints, qualified engineers review project execution, billing, claims, receivables, collections and inventories to ensure that project management controls are adequate.

Processes in Internal Audit are continuously strengthened for enhanced effectiveness and productivity. The Audit methodology is also designed to validate effectiveness of critical IT controls that are embedded in the business systems. Areas of coverage, frequency of audit and levels of test are re-examined and updated every year.

The Annual Audit Plan and the Reports of the Internal Audit Department are periodically reviewed by the Management Committee with a view to:- Monitor the implementation of corrective action plans.- Evaluate the effectiveness of the internal controls in the

Company.- Evaluate the currency and relevance of the risk

management processes. Assess the status of discharging of statutory mandates The Company has in place adequate internal financial controls

with reference to the financial statements. Such controls have been assessed during the year, taking into account the essential components of internal controls elucidated by the Institute of Chartered Accountants of India in its Guidance


Note on the Audit of Internal Financial Control over Financial Reporting.

The results of the assessment did not reveal material weaknesses or significant deficiencies in the design or operation of the internal financial controls.

The Board is of the opinion that there exist adequate internal control systems which are commensurate with the nature and size of its business operations.

18. HUMAN RESOURCES As a pioneer in the EPC space, the availability of talent has never

been a problem, but the challenge has been the fostering and retention of this talent in an increasingly competitive environment. The engineers are selected through campus recruitments from top engineering institutions and all trainee engineers are given as part of the induction programme, adequate training in project execution and safety.

To bring the Company’s human capital in line with the business plan for the year a program of organizational restructuring was initiated to feature the realignment of the Company’s business into functional verticals and support functions.

Your company prides itself on the creation and maintenance of a workforce that fosters creativity, ownership and productivity. Accordingly, a number of initiatives were taken during the year to improve engagement and efficiency. These included the creation of an employee incentive scheme; the launching of a house journal; the introduction of a platform for employee expression, called Gammon Talk; and the commencement of a flexible system of working hours.

Your company firmly believes that it is its people who energize and make the organizational exceptional.

GECPL has an employee base of 1,990 permanent employees, who are spread throughout the country at various project sites, workshops and regional offices.

19. CORPORATE SOCIAL RESPONSIBILTY (CSR) The Company has a CSR Committee consisting of three

Directors viz. Mr. Vimal Kaushik, Mr. Vardhan Dharkar and Mr. Venkataramana Heggade. Based on the recommendation of the CSR Committee the Board has approved and put in place a Corporate Social Responsibility Policy. The Company did not undertake any CSR activity during the year ended 31st March, 2018. Reasons for the same are specified in the CSR Report annexed to as “Annexure C”. The CSR Policy is also available on the website of the Company viz. www.gammonengineers.com

20. TRANSACTIONS WITH RELATED PARTIES Details of transactions with related parties covered under

the provisions of Section 188 of the Companies Act, 2013 is attached in prescribed Form AOC-2 at “Annexure D”.

21. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS The particulars of loans, investments and guarantees is

provided in note no. 4 to the Financial Statements.

22. PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

The Company has adopted an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. As per the Act, your Company has constituted Internal Complaints Committee. There were no cases/complaints lodged with the Company under the Provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 during the financial year ended 31st March, 2018.

23. SUBSIDIARIES / ASSOCIATES / JOINT VENTURES The Company has no subsidiaries/associates and joint venture

companies.24. KEY MANAGERIAL PERSONNEL Pursuant to Section 203 of the Companies Act, 2013 Ms. Gita

Bade is the whole time Company Secretary. The Company has also appointed Mr. Maruti Jambagi as the Chief Executive Officer of the Company.

25. ANNUAL RETURN The Annual Return pursuant to Section 92 (3) of the

Companies Act, 2013 is available on the Company’s website i.e. www.gammonengineers.com.

26. DELAY IN CONVENING THE 4TH ANNUAL GENERAL MEETING The 4th Annual General Meeting (AGM) was to be held on or

before 30th September, 2018. Since the Company has migrated to a new ERP System, technical glitches led to delays in data migration and in stabilizing the ERP system which delayed the preparation and audit of the Company’s Financial Statements for the financial year ended 31st March, 2018. As a result the Company could not meet the statutory requirements of holding the 4th AGM on or before 30th September, 2018 and had sought an extension from the Registrar of Companies, (ROC) Mumbai for holding the 4th Annual General Meeting. The ROC vide its letter dated 27th September, 2018 has granted the Company an extension of upto 3 (Three) months for holding the 4th AGM.

27. ACKNOWLEDGEMENT The Directors express their deep gratitude and thank the

Central and State Governments as well as their respective departments and agencies, clients subcontractors, vendors and consultants and also Banks, Financial Institutions, Shareholders, Employees and all other stakeholders for their continued support co-operation and assistance.

For and on behalf of the BoardGAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITED

Sd/- Sd/-Vardhan Dharkar Venkataramana HeggadeDirector-Finance Executive DirectorDIN: 00045622 DIN: 03203031

Place: MumbaiDate: 26th October, 2018


ANNEXURE AA. Conservation of Energy: In a consistent drive to optimize construction cost and corporate

responsibility towards global environmental issues, company is already stressing to pull down overall energy cost in its construction business. New areas have been explored to control the energy consumption and reduce energy losses in the system & components. Various means and methods of energy efficiency have been implemented at corporate office, workshops and project sites to achieve gradual improvement. Some of the major actions as parts of energy management which have played a vital role to reduce energy cost are given below:1. Energy Audit: Energy audit in its basic form has been

initiated to monitor overall energy aspects of all sites, which has provided the potential areas for further corrective actions and thus reduce energy cost substantially. For e.g. Installation of energy efficient equipments (Use of APFC control panels, Soft Starters & VFD systems).

2. Availability of Grid Power: To meet the construction power demand at project sites, grid power is comparatively the most economical energy to use. Sites have put efforts to get grid power and now are being operated with enough amount of grid power with minimum energy cost.

3. Economical use of Grid Power: Use of available grid power in economical manner has reduced cost of energy. Grid power is being used with optimum power factor and load regularization as per site requireme nt. Site load regularization avoids the additional charges on electrical energy.

4. Improved Plant Load Factor (PLF) of DG sets: Higher Plant Load Factor (PLF) of DG sets supports generation of electricity at optimal cost. PLF of DG sets have improved gradually during the year by adequate load management. Initiation has contributed to improve PLF under nonconductive variable load conditions.

5. Addition of Small DG Set to Avail Redundant Load: Considering the non-working hours or redundant load duration when site load is minimum and imperative to operate, provision of small DG set, helps to keep diesel generation cost low. We have also ensured that all DG sets are equipped with Energy Meters to monitor per hour energy cost.

6. Load Sharing & Synchronization of DG sets: To avail variable bulk load on DG sets and improve Plant Load Factor (PLF) of DG sets, DG sets are being operated in load sharing mode as per load requirement of site.

7. Centralized Power Setups: Centralized power setups are being adopted at sites to reduce system losses, operating cost and achieve better monitoring and control over all components of power setup. Cable networking and number of switchgears have also been reduced by centralized setup of power arrangements which is contributing directly to control energy losses in system.

8. Improved Automation: Increased use of automation in plants and machineries has reduced idle running of the same, which has reduced energy consumption of specific plant and machine. Auto shut down and auto start features in Air compressors, VFD’s, Dewatering Pumps etc. have controlled energy consumption.

9. Use of LED lightings: At all work places i.e. corporate office, workshops and project sites, high efficacy LED lights have replaced the old low efficacy HPSV lights at mass level. Such replacement has reduced the energy consumption and has pulled down the power demand of all locations.

10. Use of Diesel Bowsers: At all major Projects, We have inducted diesel bowsers with metering devices and Preset fuel dispensing technology to avoid theft and misuse of diesel at sites.

B. Technology Absorption:1. Efforts made towards technology absorption and

adoption:a. Salvaging of Foundation of Bagchal Bridge Project:

We have successfully used Reverse Circulation Drilling Mechanism for Piling at Bagchal Bridge Project. We have used Buma R1820 RCD Rig to drill 1200 mm diameter pile of 30 m depth through layered rock profile comprising of sand stones and mud stones.

b. Tunnel Muck Loading: We have successfully deployed 3 nos of SITON LWLXCH-180 Tunnel Mucking Loader at IRCON T48 Tunnel Project to reduce Mucking time-cycle substantially, thereby increasing productivity.

c. Modification of Boom and Stick of Komatsu PC 210 Excavator for Tunnel Application: We have successfully modified Boom & Stick of Standard Komatsu PC210 Excavator to a shorter Boom and Stick to meet dimensional requirements of Main Tunnel of IRCON T48 Tunnel Project.

d. Use of Gantry Crane with Castellated Girder Design: We have successfully used 60 MT capacity Gantry Crane (40 m span, 12 m HUH) for erection of precast segments of Signature Bridge project in Delhi. These cranes have unique castellated girder which offers reduction in structural weights thus lowering the wheel loads up to 30%, reduction in wind loads by 20% due to reduced surface area of main girder.

e. Use of Wheel Mounted Excavator: We have inducted 20 Ton Class Wheel Mounted Excavator Hyundai R210W-9S to feed concrete to slip form Paver to pave 9 m width rigid road at Hospet-Bellary Road Project. Advantage of wheeled excavator is fast and uniform feed of concrete to paver thus improving the paving speed of slip form paver and quality of paving.

2. Benefits derived as a result of above effortsa. Reduction in Cost and Energy Savingsb. Faster progress implying earlier completion of projectsc. Ease of PNM Operationsd. Eco-friendly Working Environment

C. Foreign exchange earnings and outgo: Total foreign exchange used and earned during the year

(Rs. in Crores)

Current Period ended

31st March, 2018

Previous Periodended

31st March, 2017Foreign Exchange Earnings Nil NilForeign Exchange Outgo 18.16 Nil


ANNEXURE B

Information pursuant to Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Sr. no.

Name of the employee

Designation Nature of employment –wholetime or contractual

Remuneration (in Rs.)

Qualifications Experience (No. of Years)

Date of commencement of employment in the company

Age Last employment held

%of equity shares held in the company

Whether any such employee is relative of director

1 Mr. Vardhan Dharkar

Whole-time Director designated as Director-Finance.

Wholetime 2,01,12,603 Chartered Accountant-1986

31 01-07-2016 56 Gammon India Limited-President Finance and CFO

0.11 Director

2 Mr. Maruti Jambagi

Chief Executive Officer.

Wholetime 1,82,96,677 Bachelor In Technology-1980

38 01-07-2016 62 Gammon India Limited-President

0.17 No


ANNEXURE C

ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY (“CSR”) ACTIVITIES

1. A brief outline of the Company’s CSR policy, including an overview of the projects or programs proposed to be undertaken and a reference of the web-link to the CSR policy and the projects or programs.

CSR VISION

“To contribute to the socioeconomic development of the country by building stronger, developed, sustainable communities and to improve the quality of life of the people of the country.”

OBJECTIVES OF THE CSR POLICY

This Policy shall be read in line with Section 135 of the Companies Act 2013, Companies (Corporate Social Responsibility Policy) Rules, 2014 and such other rules, regulations, circulars, and notifications (collectively referred hereinafter as Regulations) as may be applicable and as amended from time to time and will, inter-alia, provide for the following:

• Establishing a guideline for compliance with theprovisions of Regulations to dedicate a percentage of Company‘s profits for social projects.

• Ensuring the implementation of CSR initiatives inletter and spirit through appropriate procedures and reporting.

• Creatingopportunities for employees toparticipate insocially responsible initiatives.

• To undertake CSR projects largely in and aroundGECPL project sites and offices (any other needy area or backward district can be taken up irrespective of operations of the company).

• To generate through its CSR initiatives, a communitygoodwill for GECPL and help reinforce a positive and socially responsible image of GECPL as a corporate entity.

CSR ACTIVITIES TO BE UNDERTAKEN BY THE COMPANY

In accordance with the requirements of the Companies Act, 2013, the CSR activities to be undertaken by the Company under this Policy shall be the following:-

I. eradicating hunger, poverty and malnutrition, promoting preventive health care and sanitation and making available safe drinking water;

II. promoting education, including special education and employment enhancing vocation skills especially among children, women, elderly, and the differently abled and livelihood enhancement projects;

III. promoting gender equality, empowering women, setting up homes and hostels for women and orphans; setting up old age homes, day care centres and such

other facilities for senior citizens and measures for reducing inequalities faced by socially and economically backward groups;

IV. ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agro forestry, conservation of natural resources and maintaining quality of soil, air and water;

V. protection of national heritage, art and culture including restoration of buildings and sites of historical importance and works of art; setting up public libraries; promotion and development of traditional and handicrafts;

VI. measures for the benefit of armed forces veterans, war widows and their dependents;

VII. training to promote rural sports, nationally recognised sports, paralympic sports and Olympic sports;

VIII. contribution to the Prime Minister’s National Relief Fund or any other fund set up by the Central Government for socioeconomic development and relief and welfare of the Scheduled Castes, the Scheduled Tribes, other backward classes, minorities and women;

IX. contributions or funds provided to technology incubators located within academic institutions which are approved by the Central Government;

X. rural development projects;

XI. Slum Development - any area decided as such by the Central Government or any State Government or any other Competent Authority under any law for the time being in force;

XII. Any other activity taken up by the Management at the discretion and which qualifies as a CSR activity under the Companies Act, 2013 and any amendment(s) thereof.

The CSR Policy is placed on the Company’s website at the following link www.gammonengineers.com.

Composition of the CSR Committee.

The Committee comprises of Mr. Vimal Kaushik – Vice President, Mr. Vardhan Dharkar – Director-Finance and Mr. Venakataramana Heggade – Executive Director.

2. Average net profit of the Company for the last three financial years: (NET Profit shall be calculated as per Section 198)

(Rs. in Crores)

Year Profit/(loss) F.Y. 16-17 69.89F.Y. 15-16 0.01F.Y. 14-15 0.00Total Net Profit 69.90Average Net Profit 23.30


3. Prescribed CSR Expenditure (two percent of the Average Net profit as mentioned in “Item 3” above): 0.47 Lakhs.

4. Details of CSR spent during the financial year ended 31st March, 2018 - NIL

a. Total amount to be spent for the financial year : 0.47 Lakhs

b. Amount unspent, if any: 0.47 Lakhs

c. Manner in which the amount was spent during the financial year :

(1) (2) (3) (4) (5) (6) (7) (8)Sr. No

CSR Project

or activity identi-

fied

Sector in

which the

proj-ect is cov-ered

Project or programs (1) Local area or

other (2) Specify

the state and dis-

trict where projects or programs were un-dertaken

Amount outlay

(budget) project or pro-grams wise

Amount spent on the

projects or programs Subheads (1) Direct expendi-ture on

projects or programs.(2) Over-

heads:

Cu-mu-

lative ex-

pen-diture upto the re-

port-ing

peri-od

Amount spent:

Direct or through imple-

menting agency

- - - - - - - - *Give details of implementing agency

5. In case Company has failed to spend two percent of the average net profit of the last three financial years or any part thereof, the Company shall provide reasons for not spending such amount:

The Company was incorporated on 17th December, 2014 and the first financial year of the Company is a period of three and a half months ending 31st March, 2015. The Company made nominal profits in the previous three financial years. The year 2017-18 was the first full year of operations of the Company post acquisition of the Civil EPC Undertaking. During the last 12 months ending 31st March, 2018 the focus was on stabilizing and reviving the operations of the business which the Company had acquired as well as improving the liquidity position. In view of this, the Company did not undertake any CSR activity as all the resources were conserved for a period of 12 months. Going forward the CSR Committee and the Board has decided to contribute its mite towards social causes related to our sector and other CSR activities to achieve the objectives as set out in the CSR policy. Accordingly we expect to fully utilize the CSR spend in the current financial year. However at the project sites, various activities for the betterment of society are regularly undertaken such as free health camps for the locals, provision of ambulance facility, swach bharat activities, aids to local school children etc.

6. A responsibility statement of the CSR Committee that the implementation and monitoring of CSR Policy, is in compliance with CSR objectives and policy of the Company.

Not applicable.

ANNEXURE D

Form No. AOC-2

(Pursuant to clause (h) of sub-section (3)of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014)

Form for disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto

1. Details of contracts or arrangements or transactions not at arm’s length basis: NIL

(a) Name(s) of the related party and nature of relationship

(b) Nature of contracts /arrangements/transactions

(c) Duration of the contracts / arrangements/transactions

(d) Salient terms of the contracts or arrangements or transactions including the value, if any

(e) Justification for entering into such contracts or arrangements or transactions

(f ) Date(s) of approval by the Board

(g) Amount paid as advances, if any:

(h) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188

2. Details of material contracts or arrangement or transactions at arm’s length basis: NIL

(a) Name (s) of the related party & nature of relationship

(b) Nature of contracts/arrangements/transactions

(c) Duration of the contracts / arrangements/transactions

(d) Salient terms of the contracts or arrangements or transactions

(e) Date of approval by the Board

(f ) Amount paid as advances, if any


INDEPENDENT AUDITOR’S REPORTTo the Members of

Gammon Engineers and Contractors Private Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying Standalone Ind AS financial statements of Gammon Engineers and Contractors Private Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss including Other Comprehensive Income, the Statement of Cash Flow and Statement of Changes in Equity for the year ended, and a summary of significant accounting policies and other explanatory information (hereinafter referred to as “Standalone Ind AS Financial Statements”).

Management’s Responsibility for the Standalone Ind AS Financial Statements

The Company’s Board of Directors are 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 that give a true and fair view of the financial position, financial performance including other comprehensive income and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Companies (Indian Accounting Standards) Rules, 2015 (Ind AS) specified under Section 133 of the Act, read with relevant rules thereon.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgements 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.

Auditor’s Responsibility

Our responsibility is to express an opinion on these Standalone Ind AS Financial Statements based on our audit. We have taken into account the provisions of the Act, 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. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards 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.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Standalone Ind AS Financial Statements. 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. 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 accounting policies used and the reasonableness of the accounting estimates made by Company’s directors, as well as evaluating the overall presentation of the Standalone Ind AS Financial Statements.

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

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 including the Ind AS under section 133, of the financial position of the Company as at March 31, 2018, its financial performance including other comprehensive income, its cash flows and the statement of changes in equity for the year ended on that date.

Emphasis of Matter

Without qualifying our opinion, we draw attention to the following matters;

a. Note no 3(a) of the Statement relating to recognition of claims while evaluating the jobs of Rs. 86 Crores where the Company is confident of recovery based on advanced stage of negotiation and discussion with the clients. The recoverability is dependent upon the final outcome of the appeals & negotiations getting resolved in favour of the Company.

b. Note No. 3(c) and 4(b), relating to amounts due from the M/s Gammon India Limited in respect of trade receivables and loans recoverable. The management for the reasons discussed in the aforesaid notes is confident of recovery of the amounts supported by subsequent realisation of part of the amounts.

c. Note no 6 (a) relating to the accounting of the various claims and awards, which the management has recognised, based on the client delays, changes of scope, hindrances, escalation claims, variation orders, deviation in design and other charges recoverable from the client. These estimations are backed by a detailed evaluation by an Independent expert in the field of claims and arbitrations. The management has received awards from arbitration by and large at values initially estimated. The Company has reviewed the estimates of the balance claims on hand under arbitration and expects that the same will be converted to awards and eventually realized from the clients. The total amount of awards and claims forming part of the unbilled revenue is Rs. 955.05 Crores.


Report on Other Legal and Regulatory Requirements

1. 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, we give in the Annexure A , a statement on the matters specified in paragraphs 3 and 4 of the said Order.

2. 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 purpose 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;

(c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with in this Report are in agreement with the books of account;

(d) In our opinion the aforesaid Standalone Ind AS Financial Statements comply with the Accounting Standards specified under Section 133 of the Act, read with relevant rules thereon;

(e) On the basis of written representations received from the Company Secretary and the review of the MCA website relating to the disqualification status of the directors as on March 31, 2018 none of the directors is 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 Company and the operating effectiveness of such controls, refer to our separate report in “Annexure B”; and

(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 Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Standalone Ind AS Financial Statements disclose the impact of pending litigations on the consolidated financial position of the Company-Refer Note 32 to the Standalone Ind AS Financial Statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses which are not provided for;

iii. There are no amounts that are required to be transferred to the Investor Education and Protection Fund during the year.

For Natvarlal Vepari & Co.Chartered AccountantsFirm Registration No.106971W

N JayendranPartnerMembership No. 40441Mumbai, Dated: October 26, 2018

ANNEXURE - A to the Auditor’s ReportTo the Independent Auditors’ Report on the Standalone Ind AS Financial Statements of Gammon Engineers and Contractors Private Limited

(i) (a) The Company has maintained proper records showing full particulars including quantitative details and situation of its Property, Plant & Equipment.

(b) Property, Plant & Equipment have been physically verified by the management during the year and no material discrepancies were identified on such verification.

(c) The title of the immovable properties which were in the name of Gammon India Limited from which Company the business was acquired during the previous year under the BTA and the scheme as detailed in note 9(e) of the Standalone Ind AS Financial Statements is in the process of being transferred in the name of the Company although the Company has executed the necessary documents and paid the stamp duty.

(ii) (a) Inventories, being project materials have been physically verified by the management at reasonable intervals during the year. In our opinion, the frequency of such verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, the procedure of physical verification of stock followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The discrepancies noticed between the physical stocks and books stocks were not material and the valuation of stock has been done on the basis of physically verified quantity. Therefore Shortage / Excess automatically gets adjusted and the same is properly dealt in the books of accounts.

(iii) According to the information and explanations given to us, 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 Companies Act, 2013. Accordingly, the provisions of clause 3(iii) (a), 3(iii) (b) and 3(iii) (c) of the 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 with respect to loans, investments, guarantees and securities given by the Company.

(v) The Company has not accepted any deposit from the public pursuant to sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and rules framed thereunder. As informed to us, there is no order that has been passed by Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal in respect of the said sections. Accordingly the provision of clause 3(v) is not applicable to the Company.

(vi) As informed to us the maintenance of the cost records under the sub-section (1) of section 148 of the Companies Act, 2013 has been prescribed and we are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, carried out a detailed examination of the records to ascertain whether they are accurate or complete.

(vii) (a) The Company has several instances of delay in depositing undisputed statutory dues including Provident Fund, Professional Tax, Employees State Insurance, Works Contract Tax, Service Tax/VAT, GST, Cess and Sales Tax dues with the appropriate authorities observed on a test check basis. On the basis of the audit procedures followed, test checks of the transaction and the representation from the Management there are arrears amounting to Rs. 0.02 Crores in Case of GST, Rs 0.13 Crores in case of Provident Fund, Rs.1.83 Crores in case of Entry Tax, Rs.0.11 Crores in case of Professional Tax and Rs 0.38 Crores in case of Royalty which were outstanding as at the last day of the financial year for a period of more than six months from the date they became payable.

(b) According to the information and explanation given to us, the details of Sales Tax, Income Tax, Service Tax and Excise Duty that have not been deposited on account of dispute are stated in the Statement of statutory dues outstanding attached herewith.

(viii) Based on the audit procedure and as per the information and explanation given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions, bank and debenture holders as at March 31, 2018 except for interest accrued and due which was paid in the subsequent month.

(ix) The Company has not raised any money by way of public issue / follow-on offer (including debt instruments). The Company has also not raised any fresh term loans during the year. Therefore the clause 3(ix) of the Companies (Auditors Report) Order 2016 is not applicable to the Company.

(x) According to the information and explanations given to us and to the best of our knowledge and belief no fraud by the Company or on the Company by its officers or employees has been noticed or reported during the year.

(xi) The Company being a private limited company, provisions of section 197 read with schedule V to the Act are not applicable. Accordingly, paragraph 3(xi) of the Order regarding payment of managerial remuneration is not applicable to the Company.

(xii) The Company is not a Nidhi Company hence clause 3(xii) of Companies (Auditors Report) Order 2016 is not applicable to the Company.

(xiii) Since the Company is a private limited company, therefore provision of section 177 is not applicable. In respect of transactions with related parties, the Company has complied with provisions of sections 188 of the Act where applicable. Necessary disclosures relating to related party transactions have been made in the financial statements as required by the applicable accounting standard.

(xiv) The Company has made preferential allotment of shares to GP group, as part of the Investment and Share Subscription Agreement entered into by the Company and the GP group in the previous year, and to others including employees. The investments were for general business purposes and have been used as such. The necessary compliances have been made by the Company in this regard.

(xv) The Company has not entered into any non-cash transactions with directors or persons connected with him and hence the clause 3(xv) of the Companies (Auditors Report) Order, 2016 is not applicable to the Company.

(xvi) The nature of business and the activities of the Company are such that the Company is not required to obtain registration under section 45-IA of the Reserve Bank of India Act, 1934.



Annexure - B to the Auditor’s ReportReport on the Internal Financial Controls with reference to Financial Statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

We have audited the internal financial controls with reference to Financial Statements of Gammon Engineers and Contractors Private Limited (“the Company”) as of March 31, 2018 in conjunction with our audit of the Standalone Financial Statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls 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 (‘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, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors’ Responsibility

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, issued by ICAI and 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 Institute of Chartered Accountants of India. 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.

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.

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 with reference to Financial Statements.

Meaning of Internal Financial Controls with reference to Financial Statements

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

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 conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion read with our paragraph on other matters, the Company has, 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, 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

Due to Change in the management and subsequent changes in the relevant software and changes in control, we have extended our review of Internal financial controls with reference to financial statements beyond the financial year to enable us to form an opinion on the effectiveness of the Internal financial control with reference to Financial Statements.




Statement Of Statutory Dues Outstanding On Account Of Disputes, As On 31st March 2018, referred To In Para 4(vi)(b) of The Annexure To Auditors’ Report

Name of Statute

State Nature of the dues Amount in Crores

Period of which it relates

Forum where dispute is pending

Sales Tax Orissa Various Disallowance 0.07 2001-02 Appeal SubmittedSales Tax Orissa Various Disallowance 0.07 2001-02 Appeal SubmittedSales Tax Orissa Various Disallowance 0.17 2007-12 Appeal SubmittedSales Tax Orissa Entry Tax 0.07 2001-02 Appeal SubmittedSales Tax West Bengal Arbitrary demand based on charging interest

on reversed ITC instead of adjusting it with remaining refundable amount

0.00 2010-11 Sr. JCT (Appellate)

Sales Tax West Bengal Arbitrary demand based on disallowances of expenditure such as depreciation, repair & maintenance etc. and STDS


Sales Tax West Bengal Arbitrary demand based on prejudice about books of accounts



5.08 2008-09 Revisional Board


2.59 2007-08 Tribunal

Sales Tax West Bengal Arbitrary order passed by Jt. Commissioner of Sales Tax - Appeals

0.68 2007-08 Tribunal


0.52 2012-13 JC Appeal

Sales Tax Assam Suo-moto revision of Assessment made allowing deduction of labour charges more than 25%

0.26 2004-05 Board of revenue (GHC Ordered)

Sales Tax Gujarat Dis-allowance of concessional sales & CST-TDS credit

2.64 2010-11 JC Appeal

Sales Tax Maharashtra Lease 0.14 1998-99,1999-00 & 2000-01

Bombay High Court

Sales Tax Maharashtra Lease 0.06 2001-02 Jt. AppealsSales Tax Madhya

PradeshVat-E-I/II Transaction Disallowance 0.97 2011-12 Appeal Board

Sales Tax Madhya Pradesh

Entry Tax 0.12 2011-12 Appeal Board

Sales Tax Chhattisgarh Entry Tax 0.00 1979-80 Tribunal

Sales TaxChhattisgarh Entry Tax 0.01 1980-81 Tribunal

Sales Tax Chhattisgarh Entry Tax 0.00 1984-85 TribunalSales Tax Chhattisgarh Entry Tax 0.01 1987-88 TribunalSales Tax Chhattisgarh Entry Tax 0.01 1993-94 TribunalSales Tax Chhattisgarh Entry Tax 0.00 1998-99 TribunalSales Tax Chhattisgarh Sales Tax On Boulders & Sand 0.01 1998-99 TribunalSales Tax Chhattisgarh Dispute over applicability of VAT Rate 0.32 2007-08 DC AppealSales Tax Andhra

PradeshDis-allowance of certain HO & other expenses 0.05 2007-08 High Court

Sales Tax Bihar Penalty 15.67 2008-09 TribunalSales Tax Bihar Penalty 19.22 2009-10 Tribunal


Name of Statute

State Nature of the dues Amount in Crores

Period of which it relates

Forum where dispute is pending

Sales Tax Bihar Disallowances of deduction claim & input tax credit

9.17 2010-11 JC Appeal

Sales Tax Bihar Entry Tax 4.97 2010-11 Appeal to be filedSales Tax Bihar Disallowances of deduction claim & input tax

credit 2.43 2011-12 Appeal to be filed

Sales Tax Uttar Pradesh

Trade Tax 1.35 2007-08 Additional Commissioner of Appeals


Entry tax on vehicle. 0.21 2007-08 Additional Commissioner of Appeals


VAT levied on RMC 1.25 2007-08 Additional Commissioner of Appeals


Disallowance of deductions 0.58 2010-11 Additional Commissioner Appeals


Non-submission of forms 0.13 2011-12 JC Appeal


Non-payment of entry tax 0.22 2011-12 JC Appeal


Non-submission of forms 0.10 2012-13 JC Appeal


Non-payment of entry tax 0.20 2012-13 JC Appeal

Total 75.87Sevice Tax

Rampur Recovery of CENVAT Credit 0.47 July 2012 to March 2015

Not yet filed

Sevice Tax

Various Liquidated Compensation/ Damages/Fines received by different Contractors for delay of the projects.

4.32 17 Aug 2012 to 29 Jan 2016

Not yet filed

Sevice Tax

Various Interest on service tax on advances received from client

18.03 Aug 2008 to Sept 2012

CESAT Appeal

Sevice Tax

Various Import of Services 0.11 Sept 2008 to March 2011

Not yet filed

Total 22.92Direct Tax

Income Tax Demand for JV 0.51 A.Y 2013-14 and A.Y. 2014-15

Appeal Filed

Direct Tax

TDS Defaults 0.80 A.Y. 2009-10 to A.Y. 2014-15

CIT Appeal Filed

Direct Tax

TDS Defaults 0.30 A.Y. 2015-16 to A.Y. 2019-20

Not yet filed

Total 1.61


BALANCE SHEET AS AT 31ST MARCH 2018(Rupees in Crore)

Particulars Note Ref As at March 31, 2018 As at March 31, 2017ASSETSNON-CURRENT ASSETS

(a) Property, plant and equipment 2 678.68 685.93(b) Intangible Asset 2 2.35 2.10(c ) Capital Work in Progress 2 7.64 -(c ) Financial assets

(i) Investments - -(ii) Trade receivable 3 347.13 59.32(iii) Loans 4 40.25 8.48(iv) Others 5 12.61 12.35

(d) Deferred Tax Assets (Net) 14 129.24 47.15(e) Other Non-Current Assets 6 570.53 700.97

TOTAL NON-CURRENT ASSETS 1,788.43 1,516.30CURRENT ASSETS

(a) Inventories 7 972.83 975.57(b) Financial assets

(i) Investments - -(ii) Trade receivables 3 744.48 745.96(iii) Cash and cash equivalents 8 13.36 79.68(iv) Bank balances - -(v) Loans 4 162.20 161.58(vi) Others 5 10.00 0.50

(c) Other Current Assets 6 748.49 307.67TOTAL CURRENT ASSETS 2,651.36 2,270.96TOTAL ASSETS 4,439.79 3,787.27

EQUITY AND LIABILITIESEQUITY

(a) Equity share capital 9 57.15 9.60(b) Other equity 10 196.91 113.76

TOTAL EQUITY 254.06 123.36LIABILITIES

NON-CURRENT LIABILITIES(a) Financial liabilities

(i) Borrowings 11 652.97 181.35(ii) Trade payables - total outstanding dues of Micro and Small Enterprise 12 - - - total outstanding dues of other than Micro and Small Enterprise 12 144.61 116.80

(b) Provisions 13 8.15 12.09(c) Deferred tax liabilities (net) 14(d) Other non-current liabilities 15 394.09 245.28

TOTAL NON-CURRENT LIABILITIES 1,199.82 555.52CURRENT LIABILITIES(a) Financial liabilities

(i) Borrowings 16 949.07 1,379.75(ii) Trade payables - total outstanding dues of Micro and Small Enterprise 17 1.89 0.91 - total outstanding dues of other than Micro and Small Enterprise 17 1,061.71 849.34(iii) Other financial liabilities 18 364.87 259.62

(b) Other current liabilities 19 590.02 578.63(c) Provisions 13 9.04 3.50(d) Current tax liabilities (net) 20 9.31 36.64

TOTAL CURRENT LIABILITIES 2,985.91 3,108.39TOTAL EQUITY AND LIABILITIES 4,439.79 3,787.27

Statement of significant accounting policies and explanatory notes forms an integral part of the financial statementsAs per our report of even dateFor Natvarlal Vepari & Co. FOR GAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITEDChartered AccountantsFirm Registration No. 106971W Vimal Kaushik

Vice-Chairman DIN: 00002573

Vardhan DharkarDirector-Finance DIN: 00045622

Venkataramana HeggadeExecutive Director

DIN: 03203031

Khushroo WadiaNon-Executive Director

DIN: 01615341N Jayendran

PartnerM.No. 40441

Gita BadeCompany Secretary

Maruti JambagiChief Executive Officer

Mumbai, Dated : 26/10/18 Mumbai, Dated : 26/10/18


STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31ST MARCH 2018(Rupees in Crore)

Particulars Note No.

April 2017 - March 2018

April 2016 - March 2017

I Revenue from Operations : 21 2,282.61 1,554.08II Other Income 22 34.20 5.17III Total Income (I +II) 2,316.81 1,559.25

IV Expenses:Cost of material consumed 23 687.47 484.31Purchases of stock-in-trade - -Changes in inventories of finished goods, work-in progress and stock-in-trade 24 25.38 (155.17)Employee benefits expense 25 259.42 181.62Subcontracting Expenses 645.18 435.44Finance Costs 26 266.20 162.92Depreciation & amortization 27 98.36 70.07Other expenses 28 361.23 310.17Total Expenses 2,343.24 1,489.36

V Profit/(Loss) before exceptional items and tax (26.43) 69.89VI Exceptional items Income / (Expense) - -VII Profit / (Loss) before tax (26.43) 69.89VIII Tax expenses

Current Tax 49.89 68.17Deferred Tax Liability / (Asset) (82.09) (46.99) Total tax expenses (32.20) 21.18

IX Profit after tax for the period 5.77 48.71X Other Comprehensive Income:

Items that will not be reclassified to profit or loss ( Net of tax) 0.12 (0.31)XI Total Comprehensive Income / (Loss) For The Period (IX +X) 5.89 48.40XII Earnings per equity share ( FV- Rs 10/share)

Basic (Rs.) 2.04 22.67 Diluted (Rs.) 2.04 22.67





DIN: 03203031



PartnerM.No. 40441





CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH 2018(Rupees in Crore)

Particulars April 2017 - March 2018 April 2016 - March 2017 A CASH FLOW FROM OPERATING ACTIVITIES

Net Profit Before Tax and Extraordinary Items (26.43) 69.89Adjustments for :Depreciation 98.36 70.08(Profit) / Loss on Sale of Assets (0.83) (2.83)Interest Expenses 266.20 162.92Provision for Doubtful Debts 0.72 2.02Interest Income (22.35) (1.96)Sundry Balances Written Back (26.18) 315.92 (3.31) 226.92Operating Profit Before Working Capital Changes 289.49 296.80Trade and Other Receivables (329.23) 617.12Inventories 2.74 (156.60)Trade Payables and Provision 269.05 159.68Other Non Financial Assets (310.38) (960.52)Other financial liabilities 66.43 75.75Other non-financial liabilities 160.20 (141.19) 101.35 (163.22)CASH GENERATED FROM THE OPERATIONS 148.30 133.58Direct Taxes Paid (77.21) (34.12)Net Cash from Operating Activities 71.09 99.46

B CASH FLOW FROM INVESTMENT ACTIVITIESPurchase of Fixed Assets (101.89) (26.84)Sale of Fixed Assets 3.73 4.09Interest Received 22.38 1.96 Net Cash from Investment Activities (75.78) (20.79)

C CASH FLOW FROM FINANCING ACTIVITIESIssue of Shares 124.81 25.20Interest paid (95.65) (5.38)Repayment of Long term Borrowing (7.41) -Repayment of Short term Borrowing (83.38) (56.16) Net Cash from Financing Activities (61.63) (36.34)NET INCREASE IN CASH AND CASH EQUIVALENTS (66.32) 42.34Balance as at 31 Mar 2017 79.68 0.09Add: Cash and Cash Equivalent received on acquisitioin of Business - (37.25)Balance as at 31 Mar 2018 13.36 79.68NET INCREASE IN CASH AND CASH EQUIVALENTS (66.32) 42.34Note: Figure in brackets denote outflows





DIN: 03203031



PartnerM.No. 40441





STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED MARCH 31ST, 2018A Equity Share Capital

Particulars March 31, 2018 March 31, 2017 April 1, 2016Number of

SharesRs. in

CroresNumber of

SharesRs. in Crores Number

of SharesRs. in

CroresEquity shares of INR 10 each issued, subscribed and fully paidOpening Balance 96,00,000 9.60 1,00,000 0.10 1,00,000 0.10Changes in equity share capital during the year 4,75,45,715 47.55 95,00,000 9.50 - -Balance at March 31, 2018 5,71,45,715 57.15 96,00,000 9.60 1,00,000 0.10

B Other Equity

Particulars Retained Earnings

Security Premium

Equity Suspense

Debenture Redemption

Reserve

Total

Balance as at 1 April 2016 0.01 - - - 0.01Profit for the year 48.71 23.75 41.60 1.55 115.61Remeasurement gain / loss on defined benefits plan net of taxes (0.31) - - - (0.31)Transfer to Debenture Redemption Reserve (1.55) - - - (1.55)Balance as at 31 March 2017 46.86 23.75 41.60 1.55 113.76Profit for the year 5.77 - - - 5.77Premium on issue of shares - 118.86 - - 118.86Shares pending allotment (Refer Note 9 (e)) - - (41.60) - (41.60)Transfer to Debenture Redemption Reserve 0.06 - - (0.06) -Remeasurement gain / loss on defined benefits plan net of taxes 0.12 - - - 0.12Balance at March 31, 2018 52.81 142.61 - 1.49 196.91

Securities premium

Securities premium is used to record the premium on issue of shares or debentures.

Debenture Redemption Reserve

In accordance with Circular issued by Ministry of Corporate Affairs No. 04/2013 dated 11.02.2013 the Company is maintaining the Debenture Redemption Reserve to the extent of 25% of the outstanding debentures.

As per our report of even dateFor Natvarlal Vepari & Co. FOR GAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITEDChartered AccountantsFirm Registration No. 106971W Vimal Kaushik




DIN: 03203031



PartnerM.No. 40441





1 CORPORATE INFORMATION

Gammon Engineers and Contractors Private Limited (GECPL) was incorporated in 2014 as Nikias Metals Private Limited. The name of the Company was changed to Gammon Engineers and Contractors Private Limited on 20th July, 2016 after its acquisition by Gammon India Limited (GIL) as an indirect wholly owned subsidiary.

The Company acquired the Civil Engineering and Construction Business of Gammon India Limited w.e.f 1st July, 2016 in two phases i.e as a slump sale on a going concern basis through a Business Transfer Agreement and by way of a slump exchange through a Scheme of Arrangement between GIL and the Company. The Business Transfer Agreement was duly approved by the shareholders and lenders.

The Scheme of Arrangement was approved by the National Company Law Tribunal (“NCLT”) on 22nd March 2017 and the Scheme came into operation on 31st March, 2017. Pursuant to the Scheme, the Civil EPC Undertaking essentially the Civil EPC Business carried on by GIL in roads, hydropower, nuclear power, tunnels, bridges together with all assets/properties, pre-qualifications, rights and powers and all debts, liabilities, duties and obligations comprised in and/ or pertaining to the Civil EPC Undertaking, including all employees engaged therein has been vested into the Company as a going concern on and from 1st July, 2016.

GECPL's projects cover businesses and projects involving highways, public utilities, environmental engineering and marine structures. GECPL's expertise also covers the design, financing, construction and operation of modern bridges, ports, harbours, thermal & nuclear power stations, viaducts, dams, high-rose structures, chemical & fertilizer complexes and metro rail on contract execution basis.

2 SIGNIFICANT ACCOUNTING POLICIES

i) Basis of Preparation

Ministry of Corporate Affairs notified roadmap to implement Indian Accounting Standards ('Ind AS') notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended by the Companies (Indian Accounting Standards) (Amendment) Rules, 2016. As per the said roadmap, the Company is required to apply Ind AS starting from financial year beginning on or after 1st April, 2015. Accordingly, the financial statements of the Company have been prepared in accordance with the Ind AS.

These financial statements are prepared under the historical cost convention on the accrual basis except for certain financial instruments which are measured at fair

NOTES ACCOMPANYING TO THE FINANCIAL STATEMENTS

values which are disclosed in the Financial Statements, the provisions of the Companies Act, 2013 (`Act') (to the extent notified).

The classification of assets and liabilities of the Company is done into current and non-current based on the operating cycle of the business of the Company. The operating cycle of the business of the Company is less than twelve months and therefore all current and non-current classifications are done based on the status of reliability and expected settlement of the respective asset and liability within a period of twelve months from the reporting date as required by Schedule III to the Companies Act, 2013.

Accounting policies have been consistently applied except whereas newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

The financial statements are presented in Indian Rupees (‘INR’) and all values are rounded to the nearest Crore, except otherwise indicated.

ii) Revenue Recognition:

a) Revenue from Construction Contracts:

Long term contracts including joint ventures are progressively evaluated at the end of each accounting period. On contracts under execution which have reasonably progressed, revenue is recognized by applying percentage of completion method after providing for foreseeable losses, if any. Percentage of completion is determined as a proportion of the cost incurred up to the reporting date to the total estimated cost to complete. Foreseeable losses, if any are fully provided for in the respective accounting period, irrespective of stage of completion of the contract. While determining the amount of foreseeable loss, all elements of cost and related incidental income not included in contract revenue is taken into consideration. Contract is reflected at cost that are expected to be recoverable till such time the outcome of the contract cannot be ascertained reliably and at realizable value thereafter. Claims are accounted as income in the year of acceptance by client. Additional claims (including for escalation), which in the opinion of the management are recoverable on the contract, are recognized at the time of evaluating the job.


b) Turnover

Turnover represents work certified upto and after taking into consideration the actual cost incurred and the profit evaluated by adopting the percentage of work completion method of accounting.

c) Interest Income:

Interest income for all financial instruments classified under the amortized cost category is recorded using the effective interest rate (EIR), which is the rate that exactly discounts the estimated future cash payments or receipts through the expected life of the financial instrument or a shorter period, where appropriate, to the net carrying amount of the financial asset. Interest income is included in other income in the statement of profit and loss.

d) Dividend Income:

Dividend income is accounted when the right to receive the same is established, which is generally when shareholders approve the dividend.

e) Lease income:

Lease agreements where the risks and rewards incidental to the ownership of an asset substantially vest with the lessor are recognized as operating leases. Lease rentals are recognized on straight-line basis as per the terms of the agreements in the statement of profit and loss.

f) Income from insurance claim:

Insurance claims are recognised only when there is reasonable certainty of receiving the claim.

iii) Joint Ventures

a) Joint Venture Contracts under Consortium are accounted as independent contracts to the extent of work completion.

b) In Joint Venture Contracts under Profit Sharing Arrangement, services rendered to Joint Ventures are accounted as income on accrual basis, profit or loss is accounted as and when determined by the Joint Venture and net investment in Joint Venture is reflected as investments or loans & advances or current liabilities.

iv) Employee benefits

All employee benefits payable wholly within twelve months of rendering services are classified as short term employee benefits. Benefits such as salaries, wages, short-term compensated absences, performance incentives etc., and the expected cost of bonus, ex-gratia are recognized during the period in which the employee renders related service.

Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered the service entitling them to the contribution.

The cost of providing benefits under the defined benefit plan is determined using the projected unit credit method with actuarial valuations being carried out at each balance sheet date, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measure each unit separately to build up the final obligation.

Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognized immediately in the balance sheet with a corresponding debit or credit to other comprehensive income in the period in which they occur. Remeasurements are not reclassified to the statement of profit and loss in subsequent periods. Past service cost is recognized in the statement of profit and loss in the period of plan amendment.

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset.

The Company recognizes the following changes in the net defined benefit obligation under employee benefit expenses in the statement of profit and loss:

• Service costs comprising current service costs, past-service costs, gains and losses on curtailments and non-routine settlements,

• Net interest expense or income.

Long-term employee benefits

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognized as a liability at the present value of the defined benefit obligation at the balance sheet date.

Termination benefits

Termination benefits are recognized as an expense in the period in which they are incurred.

v) Property, plant and equipment

Property, plant and equipment are stated at cost net of tax/duty credit availed, less accumulated depreciation and accumulated impairment losses, if any. When significant parts of property, plant and equipment are required to be replaced at intervals, the Company derecognizes the replaced part, and recognizes the


new part with its own associated useful life and it is depreciated accordingly. Likewise, when a major inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized in the statement of profit and loss as incurred.

Capital work-in-progress includes cost of property, plant and equipment under installation/under development as at the balance sheet date.

Property, plant and equipment are derecognised from financial statement, either on disposal or when retired from active use. Losses arising in the case of retirement of property, plant and equipment and gains or losses arising from disposal of property, plant and equipment are recognized in the statement of profit and loss in the year of occurrence.

The assets' residual values, useful lives and methods of depreciation are reviewed at each financial year end and adjusted prospectively, if appropriate.

Depreciation on the property, plant and equipment is provided over the useful life of assets as specified in Schedule II to the Companies Act, 2013 or as determined by the Independent Valuer as the case maybe . Property, plant and equipment which are added / disposed off during the year, depreciation is provided on pro-rata basis with reference to the month of addition / deletion.

vi) Leased assets

Leasehold lands are amortized over the period of lease. Buildings constructed on leasehold land are depreciated based on the useful life specified in Schedule II to the Companies Act, 2013, where the lease period of land is beyond the life of the building.

In other cases, buildings constructed on leasehold lands are amortized over the primary lease period of the lands.

vii) Intangible assets

Intangible assets are recognized when it is probable that the future economic benefits that are attributable to the assets will flow to the Company and the cost of the asset can be measured reliably.

Internally generated intangibles, excluding capitalized development costs, are not capitalized and the related expenditure is reflected in profit and loss in the period in which the expenditure is incurred.

The useful lives of intangible assets are assessed finite. The amortization period and the amortization method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes

in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortization period or method, as appropriate, and are treated as changes in accounting estimates.

Intangible assets with finite lives are amortized over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired.

Intangible Assets without finite life are tested for impairment at each Balance Sheet date and Impairment provision, if any are debited to profit and loss.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in the statement of profit and loss when the asset is derecognized.

viii) Impairment of Non-financial Assets

On annual basis the Company makes an assessment of any indicator that may lead to impairment of assets. An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. Recoverable amount is higher of an asset’s fair value or selling price.

An impairment loss is charged to the Statement of Profit and Loss in the year in which an asset is identified as impaired.

The impairment loss recognized in prior accounting period is reversed if there has been a change in the estimate of recoverable amount.

ix) Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and demand deposits with banks which are short-term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

x) Inventories

Material at Construction Site are valued at lower of cost and net realisable value. Costs are determined on Weighted Average Method.

Work In Progress on construction contracts are carried at lower of assessed value of work done less bill certified and net realisable value.

xi) Foreign currency transactions

The Company’s financial statements are presented in INR, which is also the Company’s functional currency.

Foreign currency transactions are recorded on initial recognition in the functional currency, using the


exchange rate at the date of the transaction. At each balance sheet date, foreign currency monetary items are reported using the closing exchange rate. Exchange differences that arise on settlement of monetary items or on reporting at each balance sheet date of the Company’s monetary items at the closing rate are recognized as income or expenses in the period in which they arise. Non-monetary items which are carried at historical cost denominated in a foreign currency are reported using the exchange rates at the date when the fair value is determined. The gain or loss arising on translation of non-monetary items is recognized in line with the gain or loss of the item that gave rise to the translation difference.

xii) Borrowing Cost

Borrowing costs directly attributable to the acquisition or construction of qualifying assets are capitalized as a part of the cost of such asset till such time the asset is ready for its intended use or sale. A qualifying asset is an asset that necessarily requires a substantial period of time (generally over twelve months) to get ready for its intended use or sale.

Other borrowing costs are recognized as expenses in the period in which they are incurred.

In determining the amount of borrowing costs eligible for capitalization during a period, any income earned on the temporary investment of those borrowings is deducted from the borrowing costs incurred.

xiii) Taxes on income

Current Taxes

Tax on income for the current period is determined on the basis of estimated taxable income and tax credits computed in accordance with the provisions of the relevant tax laws and based on the expected outcome of assessments/ appeals.

Current income tax relating to items recognized directly in equity is recognized in equity and not in the statement of profit and loss. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

Deferred tax

Deferred tax is provided using the balance sheet approach on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax assets are reassessed at each reporting and are recognized to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or liability settled, based on the tax rates (tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax relating to items recognized outside the statement of profit and loss is recognized outside the statement of profit and loss. Deferred tax items are recognized in correlation to the underlying transaction either in other comprehensive income or directly in equity.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

The break-up of major components of deferred tax assets and liabilities as at balance sheet date has been arrived at after setting off deferred tax assets and liabilities where the Company have a legally enforceable right to set-off assets against liabilities and where such assets and liabilities relate to taxes on income levied by the same governing taxation laws.

xiv) Provisions, Contingent Liabilities and Contingent Assets

Provisions

The Company recognizes a provision when: it has a present legal or constructive obligation as a result of past events; it is likely that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions are not recognized for future operating losses. Provisions are reviewed at each balance sheet and adjusted to reflect the current best estimates.

Contingent liabilities and Contingent Assets

A contingent liability recognised in a business combination is initially measured at its fair value. Subsequently, it is measured at the higher of the amount that would be recognised in accordance with the requirements for provisions above or the amount initially recognised less, when appropriate, cumulative


amortisation recognised in accordance with the requirements for revenue recognition.

A contingent assets is not recognised unless it becomes virtually certain that an inflow of economic benefits will arise. When an inflow of economic benefits is probable, contingent assets are disclosed in the financial statements. Contingent liabilities and contingent assets are reviewed at each balance sheet date.

Onerous contracts

A provision for onerous contracts is measured at the present value of the lower expected costs of terminating the contract and the expected cost of continuing with the contract. Before a provision is established, the Company recognizes impairment on the assets with the contract.

xv) Earning Per Share

Basic earnings per share is calculated by dividing the profit from continuing operations and total profit, both attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during the period.

xvi) Leases

The determination of whether an arrangement is, or contains, a lease is based on the substance of the arrangement at the inception date, whether fulfillment of the arrangement is dependent on the use of a specific asset or assets or the arrangement conveys a right to use the asset, even if that right is not explicitly specified in an arrangement.

Finance leases that transfer substantially all of the risks and benefits incidental to ownership of the leased item, are capitalized at the commencement of the lease at the fair value of the leased property or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and a reduction in the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognized in finance costs in the statement of profit and loss.

A leased asset is depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Company will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.

Assets acquired on leases where a significant portion of the risks and rewards of ownership are retained by lessor are classified as operating leases. Lease rentals are charged to the statement of profit and loss on straight line basis.

xvii) Current and non-current classification

The Company presents assets and liabilities in the balance sheet based on current/non-current classification.

An asset is current when it is:

• Expected to be realized or intended to sold or consumed in normal operating cycle,

• Held primarily for the purpose of trading,

• Expected to be realized within twelve months after the reporting period,

All other assets are classified as non-current.

A liability is current when:

• It is expected to be settled in normal operating cycle,

• It is held primarily for the purpose of trading,

• It is due to be settled within twelve months after the reporting period, or

• There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period. Deferred tax assets/liabilities are classified as non-current.

All other liabilities are classified as non-current.

xviii) Fair value measurement

The Company measures financial instruments such as derivatives and certain investments, at fair value at each balance sheet date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

• In the principal market for the asset or liability, or

• In the absence of a principal market, in the most advantageous market for the asset or liability.

The principal or the most advantageous market must be accessible by the Company.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.


The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

• Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities

• Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

• Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognized in the balance sheet on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

xix) Financial instruments

a. Financial assets:

Initial recognition and measurement

All financial assets are recognized initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.

Financial assets are classified, at initial recognition, as financial assets measured at fair value or as financial assets measured at amortized cost.

Subsequent measurement

For purposes of subsequent measurement financial assets are classified in two broad categories:

• Financial assets at fair value

• Financial assets at amortized cost

Where assets are measured at fair value, gains

and losses are either recognized entirely in the statement of profit and loss (i.e. fair value through profit or loss), or recognized in other comprehensive income (i.e. fair value through other comprehensive income).

A financial asset that meets the following two conditions is measured at amortized cost (net of any write down for impairment) unless the asset is designated at fair value through profit or loss under the fair value option.

• Business model test: The objective of the Company's business model is to hold the financial asset to collect the contractual cash flows (rather than to sell the instrument prior to its contractual maturity to realize its fair value changes).

• Cash flow characteristics test: The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A financial asset that meets the following two conditions is measured at fair value through other comprehensive income unless the asset is designated at fair value through profit or loss under the fair value option.

• Business model test: The financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets.

• Cash flow characteristics test: The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Even if an instrument meets the two requirements to be measured at amortized cost or fair value through other comprehensive income, a financial asset is measured at fair value through profit or loss if doing so eliminates or significantly reduces a measurement or recognition inconsistency (sometimes referred to as an 'accounting mismatch') that would otherwise arise from measuring assets or liabilities or recognizing the gains and losses on them on different bases.

All other financial asset is measured at fair value through profit or loss.

All equity investments other than investment on subsidiary , joint venture and associates are measured at fair value in the balance sheet, with value changes recognized in the statement of profit and loss.


Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognized (i.e. removed from the Company's balance sheet) when:

• The rights to receive cash flows from the asset have expired, or

• The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a 'pass-through' arrangement and either:

(a) the Company has transferred substantially all the risks and rewards of the asset, or

(b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognize the transferred asset to the extent of the Company's continuing involvement. In that case, the Company also recognizes an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.

Investment in associates, joint venture and subsidiaries

The Company has accounted for its investment in subsidiaries and associates, joint venture at cost.

Impairment of financial assets

The Company assesses impairment based on expected credit losses (ECL) model to the Financial assets measured at amortized cost

Expected credit losses are measured through a loss allowance at an amount equal to:

• the 12-months expected credit losses (expected credit losses that result from those default events on the financial instrument that are possible within 12 months after the reporting date); or

• full lifetime expected credit losses (expected credit losses that result from all possible default events over the life of the financial instrument).

The Company follows 'simplified approach' for recognition of impairment loss allowance on:

• Trade receivables or contract revenue receivables; and

• All lease receivables

Under the simplified approach, the Company does not track changes in credit risk. Rather, it recognizes impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.

The Company uses a provision matrix to determine impairment loss allowance on the portfolio of trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivable and is adjusted for forward looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analyzed.

For recognition of impairment loss on other financial assets and risk exposure, the Company determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-months ECL is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the Company reverts to recognizing impairment loss allowance based on 12-months ECL.

For assessing increase in credit risk and impairment loss, the Company combines financial instruments on the basis of shared credit risk characteristics with the objective of facilitating an analysis that is designed to enable significant increases in credit risk to be identified on a timely basis.


b. Financial liabilities:

Initial recognition and measurement

All financial liabilities are recognized initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.

The Company's financial liabilities include trade and other payables, loans and borrowings including bank overdrafts, and derivative financial instruments.

Subsequent measurement

The measurement of financial liabilities depends on their classification, as described below:

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss.

Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. This category also includes derivative financial instruments entered into by the Company that are not designated as hedging instruments in hedge relationships as defined by Ind AS 109. Separated embedded derivatives are also classified as held for trading unless they are designated as effective hedging instruments.

Gains or losses on liabilities held for trading are recognized in the statement of profit and loss.

Financial liabilities designated upon initial recognition at fair value through profit or loss are designated at the initial date of recognition, and only if the criteria in Ind AS 109 are satisfied.

Loans and borrowings

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized cost using the effective interest rate (EIR) method.

Gains and losses are recognized in profit or loss when the liabilities are derecognized as well as through the EIR amortization process.

Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the statement of profit and loss.

Financial guarantee contracts

Financial guarantee contracts issued by the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the

specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Financial guarantee contracts are recognized initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequently, the liability is measured at the higher of the amount of loss allowance determined as per impairment requirements of Ind AS 109 and the amount recognized less cumulative amortization.

Derecognition

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the statement of profit and loss.

c. Offsetting of financial instruments:

Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously

d. Derivative financial instruments:

The Company enters into derivative contracts to hedge foreign currency price risk on unexecuted firm commitments and highly probable forecast transactions. Such derivative financial instruments are initially recognized at fair value on the date on which a derivative contract is entered into and are subsequently remeasured at fair value. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative.

Any gains or losses arising from changes in the fair value of derivatives are taken directly to statement of profit and loss.


2 Detailed Asset Class Wise Addition, Adjustment, Depreciation, Changes at Net Block (Rupees in Crore)

A Tangible Assets

Particulars Leasehold land

Freehold Property

Plant & Machinery

Motor Vehicles

Office Equipments

Furniture And Fixtures

Total

GROSS BLOCKAs at April 1, 2016 - - - - - - -Additions 111.78 53.61 586.45 13.88 3.30 2.38 771.40Disposals/Adjustments - - 17.69 0.14 - - 17.83Opening Block as on April 1, 2017 111.78 53.61 568.76 13.74 3.30 2.38 753.57Additions during the year - - 75.89 16.71 1.06 0.28 93.95Disposals/Adjustments - - 5.64 0.26 0.00 - 5.91As at 31 March 2018 111.78 53.61 639.01 30.19 4.36 2.66 841.61DEPRECIATIONAs at April 1, 2016 - - - - - - -Charge for the Year - 0.83 64.65 2.79 1.77 - 70.04Disposals/Adjustments - - 2.28 0.13 - - 2.41Opening Block as on April 1, 2017 - 0.83 62.37 2.66 1.77 - 67.63Charge for the Year - 1.13 91.86 4.00 0.88 0.44 98.31Disposals/Adjustments - - 2.91 0.10 0.00 - 3.01As at 31 March 2018 - 1.96 151.32 6.56 2.66 0.44 162.93NET BLOCKAs at April 1, 2017 111.78 52.79 506.39 11.08 1.52 2.38 685.93As at 31 March 2018 111.78 51.66 487.69 23.63 1.70 2.22 678.68

B Intangible Assets

Particulars Software Goodwill TotalGROSS BLOCKAs at April 1, 2016 - - -Additions 0.04 2.10 2.14Disposals/Adjustments - - -Opening Block as on April 1, 2017 0.04 2.10 2.14Additions during the year 0.30 - 0.30Disposals/Adjustments - - -As at 31 March 2018 0.34 2.10 2.44AMORTISATIONAs at April 1, 2016 - - -Charge for the Year 0.03 - 0.03Disposals/Adjustments - - -Opening Block as on April 1, 2017 0.03 - 0.03Charge for the Year 0.05 - 0.05Disposals/Adjustments - - -As at 31 March 2018 0.09 - 0.09NET BLOCKAs at April 1, 2017 0.00 2.10 2.10As at 31 March 2018 0.25 2.10 2.35

C Capital WIP

Particulars TotalOpening Block as on April 1, 2017 -Additions: Plant & Machinery 7.64Disposals/Adjustments/Capitalisation -As at 31 March 2018 7.64


STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES AND OTHER EXPLANATORY NOTESOTHER NOTES (Rupees in Crore)

3 Financial Assets - Trade Receivables

Particulars As at 31st Mar 2018 As at 31st Mar 2017 Non Current Current Non Current Current

Trade Receivables :Considered good- Unsecured 348.00 746.35 59.48 747.82Trade Receivables- Credit Impaired - 5.32 - 5.30Provisions for credit impairment - (5.32) - (5.30)

348.00 746.35 59.48 747.82

Less: Expected credit loss 0.87 1.87 0.16 1.86 347.13 744.48 59.32 745.96

Total 347.13 744.48 59.32 745.96(a) In respect of the projects undertaken by the Company: The Company in evaluating its jobs has considered an amount of Rs. 86

Crore arising out of claims for work done on account of cost overruns arising due to client delays, changes of scope, hindrances, escalation claims, variation orders, deviation in design and other charges recoverable from the client which are pending acceptance or certification by the client or referred the matter to the dispute resolution board / arbitration panel.

(b) Expected Credit Loss

The Company uses a provision matrix to determine impairment loss on portfolio of its trade receivable. The provision matrix is based on its historically observed default rates over the expected life of the trade receivable and is adjusted for forward- looking estimates. At every reporting date, the historical observed default rates are updated and changes in forward-looking estimates are analysed. The Company estimates the following matrix at the reporting date which is calculated on overdue amounts.

Particulars As at 31st Mar 2018 As at 31st Mar 2017Balance at the beginning of the period 2.02 -Net movement in expected credit loss allowance on trade receivables calculated at lifetime expected credit losses

0.72 2.02

Provision at the end of the period 2.74 2.02(c) Trade Receivable Includes dues Receivable from related parties i.e., Gammon India Limited which amounts to Rs 8.50 Crores. The

Management is confident of recovery of the amount due from Gammon India Limited despite the financial weakness as these are project related dues and the projects are in progress.

4 Financial Assets: Loans (at amortised cost)


Loans and Advances to Related Parties :Considered Good- Unsecured 7.73 158.46 7.68 119.97DepositsConsidered Good 32.52 3.74 0.80 41.61 Total 40.25 162.20 8.48 161.58


(a) Details of Loans given to Related Parties (Rupees in Crore)

Name of the Related Party As at 31st Mar 2018 As at 31st Mar 2017 Non Current Current Non Current Current

Unsecured and Considered Good:-Gammon Progressive JV 0.61 - 0.61 -Gammon Rizzani JV 0.44 - 0.44 -Jager Gammon Joint Venture 1.59 - 1.59 -Gammon Archirodon Joint Venture 0.03 - 0.03 -Gammon Encee Consortium 4.85 - 4.85 -Atlanta India Limited Gammon Joint Venture 0.11 - 0.11 -BBJ Gammon Joint Venture 0.05 - 0.05 -Gammon Cidade Tensacciai Joint Venture - 7.71 - 5.50Gammon JMC Joint Ventures 0.05 - - 0.05Gammon CMC Joint Venture - 11.87 - 7.26Gammon India Limited - 138.88 - 107.16Total 7.73 158.46 7.68 119.97

(b) The amount of Rs 107.16 Crores receivable as at March 31, 2017 from Gammon India Limited relates to the payments made from the common pool of funds during the period from July 1, 2016 till the effective date towards obligations of Gammon India Limited out of money received on GECPL account. This amount has increased further to Rs. 138.88 Crores as at March 31, 2018. During the subsequent year till the date of signing of these financials the Company has recovered an amount of Rs. 45.22 Crores . In respect of the balance amount the Company has asked GIL to take steps to secure the same against the assignment of specific claims and awards. GIL has written to the clients for the assignment of the specific awards. The management is confident that it will be able to recover the amounts from GIL based on active discussions and follow up with GIL. No interest is accrued on the same amount although the Company has reserved its rights to receive interest in case the said awards are received with accrued interest.

5 Other Financial Assets


Interest Accrued Receivable 10.67 - 10.70 -Insurance claim receivable 1.65 10.00 1.65 -Other Receivable 0.29 - - 0.50Total 12.61 10.00 12.35 0.50

Interest Accrued Receivable from related party:-


Gammon Cidade Tensacciai JV 7.06 - 7.28 -Gammon CMC JV 0.51 - 0.31 -Total 7.57 - 7.59 -

6 Other Assets


Capital Advances 1.99 - 3.69 -Unbilled Revenue 508.60 476.20 669.83 115.42Prepaid Expenses - 5.52 - 1.12Advance to Creditors/Subcontractors 34.41 198.34 10.66 159.00Staff Advances - 3.98 - 1.39Balance with Tax Authority 25.53 59.46 16.79 27.56Advance recoverable in cash or kind - 0.21 - 0.12Others - 4.78 - 3.06Total 570.53 748.49 700.97 307.67


(a) The Company has been recognizing claims on Jobs on the basis of evaluation carried out of each project based on the client delays, changes of scope, hindrances, escalation claims, variation orders, deviation in design and other charges recoverable from the client. These estimations are backed by a detailed evaluation by an Independent expert in the field of claims and arbitrations. Out of the total claims recognised on estimated basis, the Company has received arbitration awards in about 50% of the cases. These awards have been by and large received at values estimated by the Company and the Independent expert. In the balance 50%, the arbitration proceedings are in progress at various stages. The Company has reviewed the estimates of the balance claims on hand under arbitration and expects that the same will be converted to awards and eventually realized from the clients. The total amount of awards and claims forming part of the unbilled revenue is Rs. 955.05 Crores. Based on the policy rolled out by the NITI Aayog relating to the realization of 75% of the award against submission of bank guarantees, the Company has considered such amounts are current as it expects to realize the same within its operating cycle.

7 Inventories

Particulars As at 31st Mar 2018 As at 31st Mar 2017Material at Construction Site 194.98 174.90Work In Progress 730.49 756.36Consumable Spares 47.36 44.31Total 972.83 975.57

Inventory Valuation Policy

Work In Progress Work In Progress on construction contracts are carried at lower of assessed value of work done less bill certified and net realisable value.

Material at Construction Site Material at Construction Site are valued at lower of cost and net realisable value. Costs are determined on Weighted Average Method.

Consumable Spares Consumable Spares are valued at lower of cost and net realisable value. Costs are determined on Weighted Average Method.

8 Cash and Cash Equivalent

Particulars As at 31st Mar 2018 As at 31st Mar 2017Cash on Hand 0.34 0.47Funds in Transit 5.47 11.53Balances with Bank 6.80 67.68Balances in Fixed deposit 0.75 -Total 13.36 79.68

9 Equity Share Capital

(a) Authorised, Issued, Subscribed and Fully Paid up :

Particulars As at 31st Mar 2018 As at 31st Mar 2017 No of Shares Amount No of Shares Amount

Authorised Capital :Equity Shares of Rs.10/- each 5,80,00,000 58.00 96,00,000 9.60Issued, Subscribed and Fully Paid up Capital :Issued CapitalEquity Shares of Rs.10/- each, fully paid 5,71,45,715 57.15 96,00,000 9.60Subscribed and Fully Paid up CapitalEquity Shares of Rs.10/- each, fully paid 5,71,45,715 57.15 96,00,000 9.60Total 57.15 9.60

During the year, the company’s authorised capital increased from Rs. 9.60 Crores to Rs. 58.00 Crores comprising of 5,71.45,715 number of equity shares of face value Rs. 10 each.

(Rupees in Crore)


(b) Reconciliation of Number of Shares Outstanding (Rupees in Crore)

Particulars As at 31st Mar 2018 As at 31st Mar 2017 No of Shares Amount No of Shares Amount

As at the beginning of the year 96,00,000 9.60 1,00,000 0.10 Add: Issued during the year 4,75,45,715 47.55 95,00,000 9.50 As at the end of the year 5,71,45,715 57.15 96,00,000 9.60

(c) Details of Shareholding in Excess of 5%

Name of Shareholder As at 31st Mar 2018 As at 31st Mar 2017 No of Shares % No of Shares %

Gateway Infra Holdings Pte. Ltd. 2,19,14,286 38.35% 72,00,000 75.00%Gammon India Limited 1,41,85,714 24.82% 23,00,000 23.96%Ajanma Holdings Pvt. Ltd. 1,22,85,716 21.50% - -Christiani and Neilsen(Thai) Public Company Limited 60,00,000 10.50% - -

(d) Terms / rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs.10/- each. Each holder of equity share is entitled to one vote per share. The distribution will be in proportion to the number of equity shares held by the shareholders.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by the shareholders.

(e ) Gammon Engineers and Contractors Private Limited (GECPL) acquired the Civil Engineering and Construction Business of Gammon India Limited ( GIL) from 1st July, 2016 in two phases i.e as a slump sale on a going concern basis through a Business Transfer Agreement and by way of a slump exchange through a Scheme of Arrangement between GIL and the Company. The Business Transfer Agreement was duly approved by the shareholders and lenders and the Scheme of Arrangement was approved by the National Company Law Tribunal (“NCLT”) on 22nd March 2017 and the Scheme came into operation on 31st March, 2017. Pursuant to the BTA and the Scheme, the Civil EPC Undertaking essentially the Civil EPC Business carried on by GIL in roads, hydropower, nuclear power, tunnels, bridges together with all assets properties, pre-qualifications, rights and powers and all debts, liabilities, duties and obligations comprised in and/ or pertaining to the Civil EPC Undertaking, including all employees engaged therein has been vested into the Company as a going concern on and from 1st July, 2016. During the year the Company has issued the balance consideration against the scheme disclosed as Equity Suspense in the previous year of 1,18,85,714 equity shares of Rs. 10/- each at a price of Rs. 35/- each per share (including premium of Rs. 25/- per share).

10 Other Equity

Particulars As at 31st Mar 2018 As at 31st Mar 2017Surplus 52.81 46.86Equity Suspense Account ( Refer Note 9 (e)) - 41.60Securities Premium 142.61 23.75Debenture Redemption Reserve 1.49 1.55TOTAL 196.91 113.76


11 Non Current Financial Liabilities - Borrowings (Rupees in Crore)

(a)

Particulars As at 31st Mar 2018 As at 31st Mar 2017 Non

Current Current

MaturitiesNon

CurrentCurrent

MaturitiesNon Convertible Debentures:Banks and Financial Institutions 5.97 - 6.21 -Term Loans:Priority Loan 9.68 - 9.68 -Rupee Term Loan RTL 14.41 - 14.41 -Funded Interest Term Loan (FITL) 249.57 85.77 10.86 30.01Working Capital Term Loan (WCTL) 373.34 108.51 140.19 -TOTAL 652.97 194.28 181.35 30.01The above amount includesSecured Borrowings 652.97 194.28 181.35 30.01Unsecured Borrowings - - - -

(b) Securities for Term Loans and NCD : Rupee Term Loan (RTL)

1) First ranking pari passu Security Interest on entire fixed assets (movable and immovable), both present and future of the Company.2) Second ranking pari passu Security Interest on the entire Current Assets, loans and advances, long term trade receivables and

other assets of the Company.Priority Loan1) First ranking pari passu Security Interest on entire fixed assets (movable and immovable), both present and future of the Company2) Second ranking pari passu Security Interest on the entire Current Assets, loans and advances, long term trade receivables and

other assets of the Company. Working Capital Term Loan (WCTL)1) First ranking pari passu Security Interest on entire fixed assets (movable and immovable), both present and future of the Company2) Second ranking pari passu Security Interest on the entire Current Assets, loans and advances, long term trade receivables and

other assets of the Company.Funded Interest Term Loan (FITL)1) First ranking pari passu Security Interest on entire fixed assets (movable and immovable), both present and future of the Company2) Second ranking pari passu Security Interest on the entire Current Assets, loans and advances, long term trade receivables and

other assets of the Company.New Funded Interest Term Loan (FITL)1) First ranking pari passu Security Interest over the entire Current Assets, loans and advances, long term trade receivables and

other assets of the Company.2) Second ranking pari passu Security Interest on the entire fixed assets (immovable and movable), both present and future of the

Company.Additional Funded Interest Term Loan (Additional FITL)1) First ranking pari passu Security Interest over the entire Current Assets, loans and advances, long term trade receivables and

other assets of the Company.2) Second ranking pari passu Security Interest on the entire fixed assets (immovable and movable), both present and future of the

Company.Non Convertible Debentures (NCD)First ranking pari passu Security Interest on entire fixed assets (movable and immovable), both present and future of the Company.New Working Capital Term Loan (New WCTL)

1) First ranking pari passu Security Interest over the entire Current Assets, loans and advances, long term trade receivables and other assets of the Company.


2) Second ranking pari passu Security Interest on the entire fixed assets (immovable and movable), both present and future of the Company.

Additional Working Capital Term Loan (Additional WCTL)



Working Capital


2) Second ranking pari passu Security Interest on the entire fixed assets (immovable and movable), both present and future of the Company.]

Security creation

The security creation on the above loans in favour of the lenders was pending as at the Balance Sheet date and is still in the process of being created in favour of the lenders.

(c) Interest on Term Loans -

Facility ROI Basis ROICash Credit MI MCLR (6 Months) Rate (8.15%) + Spread (2.75%) 10.90%Term Loans: (RTL1, RTL2, RTL3, FITL, Priority Loan, WCTL, Additional FITL and Additional WCTL)

MI MCLR (1 Year) Rate (8.20%) + Spread (2.20%) 10.40%

Non Convertible Debentures:

Facility Principal as on 31 March 2018 RateNCD 10.50% 1.23 10.50%NCD 11.05% 1.98 11.05%NCD 9.50% 1.78 9.50%NCD 9.95% 0.98 9.95%Grand Total 5.97

(d) Repayment Term

Type of Loan Repayment ScheduleRTL Repayable in 4 quarterly installments commencing from 15th April, 2019

and ending on 15th January, 2020.Working Capital Term Loan (WCTL) Repayable in 4 quarterly installments commencing from 15th April, 2018

and ending on 15th January, 2019.NCD Repayable in 4 quarterly installments commencing from 15th April, 2020

and ending on 15th January, 2021.FITL Repayable in 11 quarterly installments commencing from 15th July, 2016

and ending on 15th January, 2019.Priority Loan Repayable in 4 quarterly installments commencing from 15th April, 2019

and ending on 15th January, 2020.Working Capital Term Loan(New WCTL)

Repayable in 6 quarterly installments commencing from 15th April, 2018 and ending on 15th July, 2019.

Additional Working Capital Term Loan (Additional WCTL)

Repayable in 28 quarterly installments commencing from 15th July, 2020 and ending on 15th April, 2027.

New Funded Interest Term Loan (New FITL) Repayable in 10 quarterly installments commencing from 15th April, 2018 and ending on 15th July, 2020.

Additional Funded Interest Term Loan (Additional FITL) Repayable in 10 quarterly installments commencing from 15th January, 2019 and ending on 15th April, 2021.


(e) Maturity profile of Term Loans and NCD (Rupees in Crore)

Period As at 31st Mar 2018 As at 31st Mar 2017Within 1 year 194.28 30.012 - 3 years 318.71 175.144 - 5 years 105.51 6.21More than 5 years 228.75 -TOTAL 847.25 211.36

(f) Non Convertible debentures ( NCD):-

LIC of India, GIC of India and United India Insurance Company have not novated the amount of NCD as per the SDR and Carve out scheme of arrangement between GIL and GECPL. Thus the amount of NCD and Additional FITL of respective insurance companies which amounts to Rs 12.76 Crores is yet to be confirmed by the Insurance Companies . The Company is therefore unable to pay the Interest outstanding of Rs 0.53 Crores as at March 31, 2018.

12 Non-Current Financial Liabilities - Trade Payable

Particulars As at 31st Mar 2018 As at 31st Mar 2017Trade Payables:Retention / Deposits 144.61 116.80Total 144.61 116.80

13 Provisions

Particulars As at 31st Mar 2018 As at 31st Mar 2017Non-Current

ProvisionsCurrent

ProvisionsNon-Current

ProvisionsCurrent

ProvisionsProvision for Employee Benefits:Provision for Gratuity 0.53 7.30 4.69 1.89Provision for Leave Encashment 7.62 1.74 7.40 1.61Total 8.15 9.04 12.09 3.50

(a) Disclosures as required by Indian Accounting Standard (Ind AS) 19 Employee Benefits- Gratuity

Table Showing Change in the Present Value of Projected Benefit Obligation 2017-18 2016-17Present Value of Benefit Obligation at the Beginning of the Period 7.32 -Interest Cost 0.53 0.43Current Service Cost 0.71 0.57Past Service Cost 0.51 -Liability transferred In - on scheme and BTA - 6.97Benefit Paid Directly by the Employer - (0.30)Benefit Paid From the Fund (0.66) (0.73)Actuarial (Gains)/Losses on Obligations - Due to Change in Demographic Assumptions - 0.03Actuarial (Gains)/Losses on Obligations - Due to Change in Financial Assumptions (0.26) 0.34Actuarial (Gains)/Losses on Obligations - Due to Experience 0.14 0.01Present Value of Benefit Obligation at the End of the Period 8.29 7.32

Table Showing Change in the Fair Value of Plan Assets 2017-18 2016-17Fair Value of Plan Assets at the Beginning of the Period 0.74 -Interest Income 0.04 0.09Contribution by the Employer 0.34 0.05Assets transferred In - on scheme and BTA - 1.34Benefit Paid from the Fund (0.66) (0.73)Return on Plan Assets, Excluding Interest Income 0.00 (0.01)Fair Value of Plan Assets at the End of the Period 0.46 0.74


Table Showing Change in the Fair Value of Plan Assets 2017-18 2016-17Present Value of Benefit Obligation at the end of the Period 8.29 7.32Fair Value of Plan Assets at the end of the Period 0.46 0.74Funded Status (Surplus/ (Deficit)) (7.83) (6.58)Net (Liability)/Asset Recognized in the Balance Sheet (7.83) (6.58)

Expenses Recognized in the Statement of Profit or Loss for Current Period 2017-18 2016-17Current Service Cost 0.71 0.57Net Interest Cost 0.49 0.35Past Service Cost 0.51 -Expenses Recognized 1.70 0.92

Expenses Recognized in the Other Comprehensive Income (OCI) for Current Period 2017-18 2016-17Actuarial (Gains)/Losses on Obligation For the Period (0.11) 0.38Return on Plan Assets, Excluding Interest Income (0.00) 0.01Net (Income)/Expense For the Period Recognized in OCI (0.12) 0.39

Balance Sheet Reconciliation 2017-18 2016-17Opening Net Liability 6.58 -Expenses Recognized in Statement of Profit or Loss 1.70 0.91Expenses Recognized in OCI (0.12) 0.39Net Liability/(Asset) Transfer In - 5.62Benefit Paid Directly by the Employer - (0.30)Employer's Contribution (0.34) (0.05)Net Liability/(Asset) Recognized in the Balance Sheet 7.83 6.58

Category of Assets 2017-18 2016-17Insurance fund 0.47 0.68Total 0.47 0.68

Assumptions (Previous Period) 2017-18 2016-17Expected Return on Plan Assets 7.68% 7.22%Rate of Discounting 7.68% 7.22%Rate of Salary Increase 4.00% 4.00%Rate of Employee Turnover 30% for LMR, 10% and

2% for HO 30% for LMR, 10% and

2% for HOMortality Rate During Employment Indian Assured Lives

Mortality (2006-08) Indian Assured Lives

Mortality (2006-08)Mortality Rate After Employment N.A. N.A.

Sensitivity Analysis 2017-18 2016-17Projected Benefit Obligation on Current Assumptions 8.29 7.32Delta Effect of +1% Change in Rate of Discounting (0.51) (0.37)Delta Effect of -1% Change in Rate of Discounting 0.58 0.69Delta Effect of +1% Change in Rate of Salary Increase 0.58 0.70Delta Effect of -1% Change in Rate of Salary Increase (0.52) (0.39)Delta Effect of +1% Change in Rate of Employee Turnover 0.15 0.25Delta Effect of -1% Change in Rate of Employee Turnover (0.16) (0.02)

(Rupees in Crore)


Note :

1 Gratuity is payable as per company’s scheme as detailed in the report.

2 Actuarial gains/losses are recognized in the period of occurrence under Other Comprehensive Income (OCI). All above reported figures of OCI are gross of taxation.

3 Salary escalation & attrition rate are considered as advised by the company; they appear to be in line with the industry practice considering promotion and demand & supply of the employees.

4 Maturity Analysis of Projected Benefit Obligation is done considering future salary, attrition & death in respective year for members as mentioned above.

5 Risk Factors:

Interest rate risk: A fall in the discount rate which is linked to the G.Sec. Rate will increase the present value of the liability requiring higher provision. A fall in the discount rate generally increases the mark to market value of the assets depending on the duration of asset.

Salary Risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an increase in the salary of the members more than assumed level will increase the plan’s liability.

Investment Risk: The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds. If the return on plan asset is below this rate, it will create a plan deficit. Currently, for the plan in India, it has a relatively balanced mix of investments in government securities, and other debt instruments.

Asset Liability Matching Risk: The plan faces the ALM risk as to the matching cash flow. Since the plan is invested in lines of Rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.

Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

Concentration Risk: Plan is having a concentration risk as all the assets are invested with the insurance Company and a default will wipe out all the assets. Although probability of this is very less as insurance companies have to follow regulatory guidelines.

14 Deferred Tax (Liabilities) / Assets (Net)

Particulars As at 31st Mar 2018 As at 31st Mar 2017Deferred Tax LiabilityDepreciation (3.98) (8.32)Deferred Tax AssetProvision for Doubtful Debts 0.96 0.70Tax Disallowances 123.19 51.61ICDS Adjustments 9.07 133.22 3.16 55.47Deferred Tax (Liabilities) / Assets (Net) 129.24 47.15

15 Other Non-Current Liabilities

Particulars As at 31st Mar 2018 As at 31st Mar 2017Client Advances 394.09 245.28Total 394.09 245.28

16 Current Financial Liabilities - Borrowings

The borrowings are analysed as follows :

Particulars As at 31st Mar 2018 As at 31st Mar 2017Loans Repayable on Demand :Cash Credit from Consortium Bankers 945.64 1,364.00Other Loans and Advances :Buyers Credit in foreign currency 3.43 15.75TOTAL 949.07 1,379.75The above amount includesSecured Borrowings 949.07 1,379.75Unsecured Borrowings - -

(Rupees in Crore)


(i) Securities - Cash Credit from Consortium Bankers :

1) First ranking pari passu Security Interest over the entire Current Assets, loans and advances, long term trade receivables and other assets of the Company


(ii) Buyers Credit are secured by guarantee of consortium bankers.

(iii) Interest Rate:-

Cash Credit The rate of interest on above loan is linked to MI MCLR (6 Months) Rate (8.15%) + Spread (2.75%).Buyers Credit Average of 1% p.a

(iv) The security creation on the above loans in favour of the lenders was pending as at the Balance Sheet date and is still in the process of being created in favour of the lenders.

17 Current Financial Liabilities - Trade Payables

Particulars As at 31st Mar 2018 As at 31st Mar 2017Trade PayablesMicro and Small Enterprise 1.89 0.91Others 1,061.71 849.34Total 1,063.60 850.25

(i) The above information regarding Micro, Small and Medium Enterprises have been determined to the extent such parties have been identified on the basis of information available with the Company. This has been relied upon by the Auditors.

(ii) The balances of the trade payables are subject to confirmation and consequent reconciliation, if any.

Disclosure In accordance with Section 22 of The Micro Small and Medium Enterprises Development Act 2006.

Particulars 31-Mar-18 31-Mar-17(i) The principal amount and the interest due thereon remaining unpaid to any micro and small

enterprises as at the end of each accounting year 2.47 0.91

Principal amount due 1.89 0.72Interest due on the above 0.58 0.19

(ii) The amount of interest paid in terms of section 16 of the MSMED Act, 2006 along with the amounts of the payment made to the supplier beyond the appointed day during the year :Principal amount paid beyond appointed day - -Interest paid thereon - -

(iii) The amount of interest due and payable for the period of delay in making payment but without adding the interest under MSME Act where payment has been made beyond appointed day during the year.

0.58 0.19

(iv) The amount of interest accrued and remaining un-paid at the end of the accounting year 0.58 0.1918 Other Current Financial Liabilities

Particulars As at 31st Mar 2018 As at 31st Mar 2017Current Maturities of Term Loan 194.28 30.01Interest Accrued 26.07 153.86Interest Accrued And Due 2.34 -Payable for Capital Goods 52.57 5.58Book Overdraft 10.32 -Other Payables- Related Party 0.83 1.32- Others 78.46 79.29 68.85 70.17Total 364.87 259.62

(Rupees in Crore)


(a) Interest Accrued and Due : The amount has been paid to the bank in the first week of April 2018 .

(b) Interest Accrued : Includes Interest on NCD amounting to Rs. 0.53 Crores which have not been novated till date by the Insurance Companies. Refer note 11(f )

(c) During the year, there was defaults in repayment of the Interest due to the lenders , defaults varies from 0 days to 88 days for repayment of interest amounting to Rs 19.61 Crores. However all these defaults was made good during the year.

19 Other Current Liabilities

Particulars As at 31st Mar 2018 As at 31st Mar 2017Client Advances 568.77 546.26Duty & Taxes Payable 20.37 31.98Others 0.88 0.39Total 590.02 578.63

20 Current Tax Liabilities

Particulars As at 31st Mar 2018 As at 31st Mar 2017Provision for taxation (net of taxes paid) 9.31 36.64Total 9.31 36.64

21 Revenue from Operations

Particulars April 2017-March 2018 April 2016-March 2017Turnover 2,207.30 1,522.49Other Operating Revenue:Miscellaneous operating income 8.07 0.41Indirect Tax Credits 35.39 26.42Sale of Scrap 5.32 -Share of Profit from Joint Ventures 0.35 1.45Liabilities Written Back 26.18 75.31 3.31 31.59Total 2,282.61 1,554.08

(b) Disclosure as required by Indian Accounting Standard (Ind AS) 11 Construction Contracts:

Particulars April 2017 - March 2018Method use to determine the contract revenue % of Completion methodMethod use to determine the stage of completion of contract

Percentage of completion is determined as a proportion of the cost incurred up to the reporting date to the total estimated cost to complete.

Particulars April to March 18 April to March 17Contract revenue for the year 2,207.30 1,522.49Aggregate amount of cost incurred and recognized profits less recognized losses upto the reporting on contract under progress

19,358.88 17,502.44

Aggregate Contract Profits/Losses recognized for contracts existing as at the year end,

3,078.28 2,727.43

Advances received from contractees 941.03 664.50Retention money 330.05 338.68Gross amount due from customers for contract work (net retention) including unbilled revenue

2,079.15 1,592.55

Gross amount due to customers for all contracts in progress for which progress billings exceed costs incurred plus recognised profits (less recognised losses

21.83 63.52

(Rupees in Crore)


22 Other Income

Particulars April 2017 -March 2018 April 2016 - March 2017Interest Income 22.35 1.96Miscellaneous Income 11.02 0.38Profit on Sale of Assets 0.83 2.83Total 34.20 5.17

23 Cost of Materials Consumed

Particulars April 2017 -March 2018 April 2016 - March 2017Opening Stock 174.90 -Add : Inventory received under BTA and Slump Exchange scheme - 217.79Add : Purchases (Net of Discount) 707.55 441.42Less : Closing Stock 194.98 174.90Total 687.47 484.31

24 Changes in Inventories of Finished Goods and Work In Progress

Particulars April 2017 -March 2018 April 2016 - March 2017Opening Work in progress 756.36 -Add : Inventory received under BTA and Slump Exchange scheme - 601.19Less : Closing Work in progress 730.98 756.36Total 25.38 (155.17)

25 Employee Benefits

Particulars April 2017 -March 2018 April 2016 - March 2017 Salaries, Bonus, Perquisites etc. 254.01 169.36 Contribution to Employees Welfare Funds, Gratuity and Leave Encashment 2.93 7.37 Staff Welfare Expenses 2.48 4.89 Total 259.42 181.62

26 Finance Cost

Particulars April 2017 -March 2018 April 2016 - March 2017Interest Expense 263.88 158.82Interest on direct taxes 1.98 4.10Other borrowing Cost 0.34 -Total 266.20 162.92

27 Depreciation & Amortisation

Particulars April 2017 -March 2018 April 2016 - March 2017Depreciation 98.36 70.04Amortisation - 0.03Total 98.36 70.07

(Rupees in Crore)


28 Other Expenses

Particulars April 2017 -March 2018 April 2016 - March 2017Plant Hire Charges 34.18 14.13Consumption of Spares 27.93 22.10Power & Fuel 118.36 70.22Fees & Consultations 20.84 16.79Rent 14.73 12.77Rates & Taxes 39.34 85.84Travelling Expenses 15.75 14.58Communication 1.78 1.53Insurance 18.80 7.31Repairs and Maintainance:Plant & Machinery 12.95 9.39Building 4.36 8.08Others 8.92 7.01Bank Charges & Guarantee Commission 14.24 8.73Other Site Expenses 25.56 25.40Sundry Expenses 1.06 2.01Provision for Doubtful Debts 0.72 2.02Foreign Exchange Loss 0.69 1.61Remuneration to Auditors 0.89 0.65Assets written off 0.13 -Total 361.23 310.17

(a) Consumption of Spares

Particulars April 2017 -March 2018 April 2016 - March 2017Opening Stock 44.31 -Add : Purchases (Net of Discount) 30.98 66.41Less : Closing Stock 47.36 44.31Total 27.93 22.10

(b) Remuneration to Statutory Auditors

Particulars April 2017 -March 2018 April 2016 - March 2017Audit Fees 0.72 0.60Certification 0.06 0.05Other Services 0.10 -Out of Pocket expenses 0.01 -Total 0.89 0.65

29 Tax Expense

Particulars April 2017 -March 2018 April 2016 - March 2017Income tax expense in the statement of profit and loss consists of:Current Tax 49.89 68.17Deferred tax (82.09) (46.99)Income tax recognised in statement of profit or loss (32.20) 21.18

(Rupees in Crore)


The reconciliation between the provision of income tax of the Company and amounts computed by applying the Indian statutory income tax rate to profit before taxes is as follows

Current Tax April 2017 -March 2018 April 2016 - March 2017Accounting profit before income tax (26.43) 69.89Enacted tax rates in India (%) 28.84% 34.61%Computed expected tax expenses (7.62) 24.19Effect of non- deductible expenses 82.80 76.06Effects of deductable Expenses 25.28 32.07

49.89 68.17 Deferred Tax

Particulars Opening as at April 1, 2017

Recognised inprofit and loss

Recognised in OCI

Closing as at March 31, 2018

Property, Plant and Equipment (8.32) 4.34 - (3.98)Provision for Doubtful Debts 0.70 0.26 - 0.96Tax Disallowances 51.61 71.58 - 123.19ICDS Adjustments 3.16 5.91 - 9.07Total 47.15 82.10 - 129.24

Particulars Opening as at April 1, 2016

Recognised inprofit and loss

Recognised in OCI

Closing as at March 31, 2017

Property, Plant and Equipment - (8.32) - (8.32)Provision for Doubtful Debts - 0.54 0.16 0.70Tax Disallowances - 51.61 - 51.61ICDS Adjustments - 3.16 - 3.16Total - 46.99 0.16 47.15

30 Earning Per Share

Earnings Per Share (EPS) = Net Profit attributable to Shareholders / Weighted Number of Shares Outstanding

Particulars April 2017 -March 2018 April 2016 - March 2017Net Profit attributable to the Equity Share holders 5.77 48.71O/s number of Equity Shares at the end of the year 5,71,45,715 96,00,000Weighted Number of Shares during the period – Basic 2,83,05,918 2,14,85,714Weighted Number of Shares during the period – Diluted 2,83,05,918 2,14,85,714Earning Per Share – Basic (Rs.) 2.04 22.67Earning Per Share – Diluted (Rs.) 2.04 22.67

Reconciliation of weighted number of outstanding during the year :

Particulars April 2017 -March 2018 April 2016 - March 2017Nominal Value of Equity Shares (Rupee Per Share) 10.00 10.00For Basic EPS :Number of Equity Shares at the beginning 96,00,000 1,00,000Add : Issue of shares 3,56,60,001 95,00,000On issue of Equity Suspense 1,18,85,714 -Outstanding Equity shares at the year end 5,71,45,715 96,00,000Add : Pending shares to be issued for consideration (Refer Note 9 (e) ) - 1,18,85,714No. of Equity Shares considered for EPS Calculation (*) 5,71,45,715 2,14,85,714Weighted Avg of Equity Shares considered for EPS 2,83,05,918 1,06,68,728For Dilutive EPS :Weighted Avg no. of shares in calculating Basic EPS 2,83,05,918 2,14,85,714Add : Dilutive Shares to be issued - -Weighted Avg no. of shares in calculating Dilutive EPS 2,83,05,918 2,14,85,714

(Rupees in Crore)


(*) In the Previous year Since the business was transferred for the entire year, for the purposes of computing the weighted average outstanding shares the issued shares have been considered for the entire period. Similarly for the purpose of current year weighted average outstanding shares , the same have been considered for the full year.

31 Disclosure under Indian Accounting Standard (Ind AS) 17 Leases

The Company has taken various residential / godowns / offices premises (including Furniture and Fittings, if any) under lease and license agreements for periods which generally range between 11 months to 3 years. These arrangements are renewable by mutual consent on mutually agreed terms. Under some of these arrangements the Company has given refundable security deposits. The lease payments are recognized in Statement of Profit and Loss under Rent Expenses.

32 (a) Contingent Liability

Particulars March 31, 2018 March 31, 2017i Liability on contracts remaining to be executed on Capital Account 31.81 28.16ii Corporate Guarantees and Counter Guarantees given to Bankers towards Guarantees

given by them for Client of the Company and Company’s share in the Joint Ventures. 788.01 620.24

iii Disputed Sales Tax Liability for which the Company has gone into appeal 75.87 75.95iv Claims against the Company not acknowledged as debts 123.65 69.84v Disputed Service Tax Liability 22.92 22.81vi Outstanding Letters of Credit Pending Acceptance 37.01 38.02vii In respect of Income Tax Matters of Company and its Joint Ventures 1.61 5.48viii Counter Claims in arbitration matters referred by the Company – liability unascertainable. - -

(b) CSR Expenditure

Gross amount required to be spent by the Company during the year is Rs. 0.47 Crores The Company is yet to spend the above amount for the CSR Activities33 Segment Reporting as per IND AS108 “ Operating Segments” The Company is engaged mainly in “Construction and Engineering” segment. The Company also primarily operates under one

geographical segment namely India. Revenue of Rs 631 Crores arising from one major customer being a Government entity contributing to more than 10% of the total

revenue of the Company.34 Gammon Engineers and Contractors Private Limited was incorporated in 2014 as Nikias Metals Private Limited. The name of the

Company was changed to Gammon Engineers and Contractors Private Limited on 20th July, 2016 after its acquisition by Gammon India Limited as an indirect wholly owned subsidiary.

GECPL acquired the Civil Engineering and Construction Business of Gammon India Limited w.e.f 1st July, 2016 in two phases i.e as a slump sale on a going concern basis through a Business Transfer Agreement and by way of a slump exchange through a Scheme of Arrangement between GIL and the Company. The Business Transfer Agreement was duly approved by the shareholders and lenders.

The Scheme of Arrangement was approved by the National Company Law Tribunal (“NCLT”) on 22nd March 2017 and the Scheme came into operation on 31st March, 2017. Pursuant to the Scheme, the Civil EPC Undertaking essentially the Civil EPC Business carried on by GIL in roads, hydropower, nuclear power, tunnels, bridges together with all assets properties, pre-qualifications, rights and powers and all debts, liabilities, duties and obligations comprised in and/ or pertaining to the Civil EPC Undertaking, including all employees engaged therein has been vested into the Company as a going concern on and from 1st July, 2016.

The Company also acquired from GIL, pursuant to the Scheme all other interests or rights (including claims, arbitration awards, etc.), accumulated experience and performance qualifications, including financial, technical and other qualifications, in or arising out of or relating to the Civil EPC Business together with all respective powers, interests, charges, privileges, benefits, entitlements, building plans, drawings (including approvals obtained for such drawings or any pending applications made for approvals), industrial and other registrations, licenses, quotas, brands and trademarks, including trademark “Gammon”.

35 Disclosure of transactions with Related Parties, as required by Indian Accounting Standard (Ind AS) - 24 “Related Party Disclosures” has been set out in a separate Annexure - 1.

36 Financial Instruments The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a

current transaction between willing parties, other than in a forced or liquidation sale.

(Rupees in Crore)


The following methods and assumptions were used to estimate the fair values:

Fair value of cash and short-term deposits, trade and other short-term receivables, trade payables, other current liabilities, short term loans from banks and other financial institutions approximate their carrying amounts largely due to the short-term maturities of these instruments.

Financial instruments with fixed and floating interest rates are evaluated by the Company based on parameters such as interest rates and individual credit worthiness of the counterparty. Based on this evaluation, allowances are taken to account for the expected losses of these receivables.

The Company uses the following hierarchy for determining and disclosing the fair value of the financial instruments by valuation technique:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities

Level 2: other techniques for which all inputs which have significant effect on recorded fair value are observable, either directly or indirectly

Level 3: techniques which use inputs that have a significant effect on recorded fair value that are not based on observable market data

Particulars Carrying amount Fair valueAs at March 31, 2018 As at March 31, 2018 Level 1 Level 2 Level 3

Financial assets at amortized cost:Trade receivables 1,091.61 1,091.61 - - -Loans and advances 202.45 202.45 - - -Other Financial Asset 22.61 22.61 - - -Cash and bank balances 13.36 13.36 - - -Total 1,330.03 1,330.03 - - -

Financial Liability at fair value through profit or loss:Derivative instruments - - - - -Total - - - - -

Financial liabilities at amortized cost:Borrowings 1,796.32 1,796.32 - - -Trade payables 1,208.21 1,208.21 - - -Other financial liabilities 170.59 170.59 - - -Total 3,175.12 3,175.12 - - -


Financial assets at amortized cost:Trade receivables 805.28 805.28 - - -Loans and advances 170.06 170.06 - - -Other Financial Asset 12.85 12.85 - - -Cash and bank balances 79.68 79.68 - - -Total 1,067.87 1,067.87 - - -

Financial Liability at fair value through profit or loss:Derivative instruments 12.81 12.81 - 12.81 -Total 12.81 12.81 - 12.81 -

(Rupees in Crore)



Financial liabilities at amortised cost:Borrowings 1,545.35 1,545.35 - - -Trade payables 967.05 967.05 - - -Other financial liabilities 259.62 259.62 - - -Total 2,772.02 2,772.02 - - -

Description of significant unobservable inputs to valuation:

The following table shows the valuation techniques and inputs for financial instruments

Particulars Method of ValuationDerivative instruments Based on valuation from Banks

Financial Risk Management Objectives And Policies

The Company’s activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company’s focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. The Company’s financial risk management is an integral part of how to plan and execute its business strategies. The Company’s financial risk management policy is set by the Managing Board.

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates, equity prices and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including investments and deposits, foreign currency receivables, payables and loans and borrowings.

The Company manages market risk through a treasury department, which evaluates and exercises independent control over the entire process of market risk management. The treasury department recommends risk management objectives and policies, which are approved by Senior Management and the Audit Committee. The activities of this department include management of cash resources, implementing hedging strategies for foreign currency exposures, borrowing strategies, and ensuring compliance with market risk limits and policies.

Foreign currency exposure as at 31st March, 2018 USD Euro RsTrade payables 9,60,580 20,85,529 23.02Borrowings - 4,25,000 3.43Total unhedged exposure payable 9,60,580 25,10,529 26.45

Advances given 25,920 1,14,000 1.08Bank Balance - 21,913 0.18Total unhedged exposure Receivable 25,920 1,35,913 1.26Less: Hedged:Forward contracts for payable - - - Total unhedged exposure payable (Net) 9,34,660 23,74,616 25.19

Foreign currency exposure as at 31st March, 2017 USD Euro RsTrade payables 3,60,580 1,16,529 3.14Borrowings 11,00,000 12,45,000 15.75Interest on ECB 7,626 1,240.00 0.06Total unhedged exposure payable 14,68,206 13,62,769 18.96Less: Hedged:Forward contracts for payable (11,00,000) (8,20,000) (12.81) Total unhedged exposure payable (Net) 3,68,206 5,42,769 6.15

(Rupees in Crore)


Foreign currency sensitivity

Sensitivity analysis is computed based on the changes in the income and expenses in foreign currency upon conversion into functional currency, due to exchange rate fluctuations between the previous reporting period and the current reporting period.

1 % increase or decrease in foreign exchange rates will have the following impact on profit before tax.

2017-18 2016-17Increase/(decrease) in profit or loss 1 % Increase 1 % decrease 1 % Increase 1 % decreaseUSD (0.06) 0.06 (0.02) 0.02Euro (0.19) 0.19 (0.04) 0.04

The Company’s exposure in foreign currency is not material and hence the impact of any significant fluctuation in the exchange rates is not expected to have a material impact on the operating profits of the Company.

Derivative financial instruments

The Company holds derivative financial instruments such as foreign currency forward contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The counterparty for these contracts is generally a bank or a financial institution. These derivative financial instruments are valued based on quoted prices for similar assets and liabilities in inactive markets or inputs that are directly or indirectly observable in the market place.

The following table gives details in respect of outstanding foreign exchange forward contracts:

As of As of31-Mar-18 31-Mar-17

Forward contractsIn USD - 7.13In Euro - 5.68Total forwards - 12.81

Credit risk

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to Rs. 1091.61 Crore as of March 31, 2018 and unbilled revenue amounting to Rs. 984.80 Crore as of March 31, 2018. To manage this, the Company monitors whether the collections are made within the contractually established deadlines. In addition to this, the Company periodically assesses the financial reliability of customers, taking into account the financial condition, current economic trends, and analysis of historical bad debts and ageing of accounts receivable. Individual risk limits are set accordingly.

The Company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk the Company compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers reasonable and supportive forwarding-looking information such as:

(i) Actual or expected significant adverse changes in business,

(ii) Actual or expected significant changes in the operating results of the counterparty,

(iii) Financial or economic conditions that are expected to cause a significant change to the counterparty’s ability to meet its obligations,

(iv) Significant increases in credit risk on other financial instruments of the same counterparty,

(v) Significant changes in the value of the collateral supporting the obligation or in the quality of third-party guarantees or credit enhancements.

Financial assets are written off when there is no reasonable expectation of recovery, such as a debtor failing to engage in a repayment plan with the Company. The Company categorises a loan or receivable for write off when a debtor fails to make contractual payments greater than 2 years past due. Where loans or receivables have been written off, the Company continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are recognised in profit or loss.

(Rupees in Crore)


Interest rate risk

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected. With all other variables held constant, the Companies profit before tax is affected through the impact on floating rate borrowings, as follows:

Particulars Increase/ Decrease in basis points Effects on Profit before tax.March 31, 2018 Plus 100 basis point (17.96)

Minus 100 basis points 17.96March 31, 2017 Plus 100 basis point (15.76)

Minus 100 basis points 15.76 The assumed movement in basis points for the interest rate sensitivity analysis is based on the currently observable market

environment, showing a significantly higher volatility than in prior years.

Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. The Company’s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company’s net liquidity position through rolling forecasts on the basis of expected cash flows.

Maturity profile of financial liabilities

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.

As at 31.03.2018 Less than 1 year 1 to 5 years More than 5 years TotalLong term Borrowing 194.28 652.97 228.75 1,076.00Short term borrowings 949.07 - - 949.07Trade payables 1,208.21 - - 1,208.21Other financial liabilities 170.59 - - 170.59Total 2,522.15 652.97 228.75 3,403.87

As at 31.03.2017 Less than 1 year 1 to 5 years 1 to 5 years TotalLong term Borrowing 30.01 181.35 - 211.36Short term borrowings 1,379.75 - - 1,379.75Trade payables 967.05 - - 967.05Other financial liabilities 229.61 - - 229.61Total 2,606.42 181.35 - 2,787.77

37 Capital Management

For the purpose of the Group’s capital management, capital includes issued equity capital, convertible preference shares, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Group’s capital management is to maximise the shareholder value.

The Group manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Group monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The gearing ratio in the infrastructure business is generally high. The Group includes within net debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents, excluding discontinued operations.

Particulars March 31, 2018 March 31, 2017Gross Debt 2,025.07 1,561.10Less:Cash and Cash Equivalent 13.36 79.68Net debt (A) 2,011.71 1,481.42Total Equity (B) 254.06 123.36Gearing ratio (A/B) 7.92 12.01

(Rupees in Crore)


38 Standards not yet effective

The amendments to standards that are issued, but not yet effective, up to the date of issuance of the Company’s financial statements are disclosed below. The Company intends to adopt these standards, if applicable, when they become effective. The Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Amendment Rules, 2017 and Companies (Indian Accounting Standards) Amendment Rules, 2018 introducing/ amending the following standards:

(i) Ind AS 115 - Revenue from Contracts with Customers

Ind AS 115 was issued on March, 29 2018 and establishes a five-step model to account for revenue arising from contracts with customers. Under Ind AS 115, revenue is recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer. The new revenue standard will supersede all current revenue recognition requirements under Ind AS. Either a full retrospective application or a modified retrospective application is required for annual periods beginning on or after April 1, 2018. The Company plans to adopt the new standard on the required effective date using the modified retrospective method. During 2017-18, the Company performed a detailed assessment of Ind AS 115 to determine the impact on its financial statement. The overall effect of implementation of Ind AS 115 is not expected to be material on the recognition and measurement of revenues, though there would be additional disclosure requirements to comply with.

(ii) Amendments to Ind AS 12 - Recognition of Deferred Tax Assets for Unrealised Losses

The amendments clarify that an entity needs to consider whether tax law restricts the sources of taxable profits against which it may make deductions on the reversal of that deductible temporary difference. Furthermore, the amendments provide guidance on how an entity should determine future taxable profits and explain the circumstances in which taxable profit may include the recovery of some assets for more than their carrying amount. Entities are required to apply the amendments retrospectively. However, on initial application of the amendments, the change in the opening equity of the earliest comparative period may be recognised in opening retained earnings (or in another component of equity, as appropriate), without allocating the change between opening retained earnings and other components of equity. Entities applying this relief must disclose that fact. These amendments are effective for annual periods beginning on or after April 1, 2018. These amendments are not expected to have any impact on the Company as the Company has no deductible temporary differences or assets that are in the scope of the amendments.

(iii) Amendments to Ind AS 40 - Transfers of Investment Property

The amendments clarify when an entity should transfer property, including property under construction or development into, or out of investment property. The amendments state that a change in use occurs when the property meets, or ceases to meet, the definition of investment property and there is evidence of the change in use. A mere change in management’s intentions for the use of a property does not provide evidence of a change in use. Entities should apply the amendments prospectively to changes in use that occur on or after the beginning of the annual reporting period in which the entity first applies the amendments. An entity should reassess the classification of property held at that date and, if applicable, reclassify property to reflect the conditions that exist at that date. Retrospective application in accordance with Ind AS 8 is only permitted if it is possible without the use of hindsight. The amendments are effective for annual periods beginning on or after April 1, 2018. These amendments are not expected to have any impact on the Company as the Company does not have assets that are in the scope of the amendments.

(iv) Appendix B to Ind AS 21 - Foreign Currency Transactions and Advance Consideration

The Appendix clarifies that, in determining the spot exchange rate to use on initial recognition of the related asset, expense or income (or part of it) on the derecognition of a non-monetary asset or non-monetary liability relating to advance consideration, the date of the transaction is the date on which an entity initially recognises the non-monetary asset or non-monetary liability arising from the advance consideration. If there are multiple payments or receipts in advance, then the entity must determine the transaction date for each payment or receipt of advance consideration.


Entities may apply the Appendix requirements on a fully retrospective basis. Alternatively, an entity may apply these requirements prospectively to all assets, expenses and income in its scope that are initially recognised on or after:

(i) The beginning of the reporting period in which the entity first applies the Appendix, or

(ii) The beginning of a prior reporting period presented as comparative information in the financial statements of the reporting period in which the entity first applies the Appendix.

The Appendix is effective for annual periods beginning on or after April 1, 2018. The Company’s current accounting practice is already in line with the aforesaid clarification.

39 Significant Accounting Judgements, Estimates And Assumptions

The financial statements require management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosures of contingent liabilities. Uncertainity about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods .

Judgements

In the process of applying the company’s accounting policies, management has made the following judgements, which have the most significant effect on the amounts recognised in the separate financial statements.

Taxes

Deferred tax assets are recognised for unused tax losses to the extent that it is probable that taxable profit will be available against which the losses can be utilised. Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits together with future tax planning strategies.

Defined benefit plans (gratuity benefits)

The cost of the defined benefit gratuity plan and the present value of the gratuity obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

The parameter most subject to change is the discount rate. In determining the appropriate discount rate for plans operated in India, the management considers the interest rates of government bonds in currencies consistent with the currencies of the post-employment benefit obligation. For plans operated outside India, the management considers the interest rates of high quality corporate bonds in currencies consistent with the currencies of the post-employment benefit obligation with at least an ‘AA’ rating or above, as set by an internationally acknowledged rating agency, and extrapolated as needed along the yield curve to correspond with the expected term of the defined benefit obligation. The underlying bonds are further reviewed for quality. Those having excessive credit spreads are excluded from the analysis of bonds on which the discount rate is based, on the basis that they do not represent high quality corporate bonds.

The mortality rate is based on publicly available mortality tables for the specific countries. Those mortality tables tend to change only at interval in response to demographic changes. Future salary increases and gratuity increases are based on expected future inflation rates for the respective countries.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.


Impairment of non-financial assets

The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash generating unit (CGU) fair value less costs of disposal and its value in use. It is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded subsidiaries or other available fair value indicators.

40 The balance sheet, statement of profit and loss, cash flow statement, statement of changes in equity, statement of significant accounting policies and the other explanatory notes forms an integral part of the financial statements of the Company for the year ended March 31, 2018.

As per our report of even dateFor Natvarlal Vepari & Co. FOR GAMMON ENGINEERS AND CONTRACTORS PRIVATE LIMITEDChartered AccountantsFirm Registration No. 106971W Vimal Kaushik




DIN: 03203031



PartnerM.No. 40441





Annexure-1Related Party Disclosure (Ind AS - 24)

A Holding CompanyGateway Infra Holdings Pte. Ltd. ( Up to 5th March, 2018)

B Entity having Significant InfluenceGateway Infra Holdings Pte. Ltd. (W.e.f. 14th March, 2018)Gammon India LimitedAjanma Holdings Private Limited (W.e.f. 31st March, 2018)

C Joint VenturesGammon Cidade Tensacciai Gammon Atlanta Gammon Rizzani Gil Archirodon Gammon CMC Jager Gammon JV Singla JV

D Key Managerial PersonnelVimal Kishore Kaushik - Vice PresidentVardhan Vasant Dharkar - Director - FinanceVenakataramana Narayana Heggade - Executive Director


B Related Parties transaction

Nature of Transactions / relationship / major parties Entity having Significant Influence

Joint Ventures

Key Managerial Personnel

Total

Revenue - 171.41 - 171.41 - (46.35) - (46.35)

Gammon Atlanta - 5.16 - 5.16 - (-) - (-)

Jager Gammon JV - 89.91 - 89.91 - (-) - (-)

Gammon Cidade Tensacciai - 45.64 - 45.64 - (19.30) - (19.30)

SINGLA JV - 30.69 - 30.69 - (27.05) - (27.05)

Sale of Goods 10.58 - - 10.58 (-) - - -

Gammon India Limited 10.58 - - 10.58 (-) - - (-)

Purchase of Goods 2.08 - - 2.08Gammon India Limited 2.08 - - 2.08

(-) - - (-)Rendering / Receiving of Services - - - -

- (0.46) - (0.46)Gammon CMC - - - -

- (0.46) - (0.46)Finance provided for Loans, expenses & on a/c payments 31.72 16.03 - 47.75

- - - -Gammon India Limited 31.72 - - 31.72

(-) - - (-)Gammon CMC - 8.38 - 8.38

- (-) - (-)SINGLA JV - 0.61 - 0.61

- (-) - (-)Gammon Cidade Tensacciai - 7.04 - 7.04

- (-) - (-)Amount liquidated towards the finance provided - 9.95 - 9.95

- (90.38) - (90.38)Gammon CMC - 3.67 - 3.67

- (-) - (-)SINGLA JV - 1.17 - 1.17

- (-) - (-)Gammon Cidade Tensacciai - 5.12 - 5.12

- (90.38) - (90.38)Issue of Share Capital at a premium 136.10 - - 136.10

(33.25) - - (33.25)Gateway Infra Holdings Pte. Ltd. 51.50 - - 51.50

(25.20) - - (25.20)Gammon India Limited 41.60 - - 41.60

(8.05) - - (8.05)Ajanma Holding 43.00 - - 43.00

(-) - - (-)

(Rupees in Crore)



Joint Ventures


Total

Interest Income during the year - 0.31 - 0.31 - (1.79) - (1.79)

Gammon Cidade Tensacciai - 0.10 - 0.10 - (1.79) - (1.79)

Gammon CMC - 0.21 - 0.21 - (-) - (-)

Interest Expenses 7.27 - - 7.27 (-) - - -

Gammon India Limited 7.27 - - 7.27 (-) - - (-)

Aggregate Consideration for Acquisition of Business Purchase

- - - -

(49.65) - - (49.65)Gammon India Limited - - - -

(49.65) - - (49.65)Share of Profit/Loss in Joint Ventures - 0.35 - 0.35

- (1.45) - (1.45)Gammon Cidade Tensacciai - 0.30 - 0.30

- (0.17) - (0.17)SINGLA JV - 0.16 - 0.16

- (0.43) - (0.43)Gammon CMC - (0.11) - (0.11)

- (0.85) - (0.85)Contract Advance Received - 18.93 - 18.93


- (7.71) - (7.71)SINGLA JV - 14.46 - 14.46

- (9.72) - (9.72)Contract Advance Given / Refund of Advance - 11.36 - 11.36


- (6.12) - (6.12)SINGLA JV - 7.72 - 7.72

- (5.24) - (5.24)Issue of Share at a Premium to Key Managerial Personnel - - 0.39 0.39

- - - -VARDHAN V DHARKAR - - 0.23 0.23

- - (-) (-)V N HEGGADE - - 0.18 0.18

- - (-) (-)Vimal Kaushik - - 0.21 0.21

- - (-) (-)Managerial/ Professional Fees Paid to Key Managerial Personnel

- - 2.74 2.74


- - (-) (-)V N HEGGADE - - 0.76 0.76

- - (-) (-)Vimal Kaushik - - 1.20 1.20

- - (-) (-)

(Rupees in Crore)



Joint Ventures


Total

Short-Term / Long-Term Benefits to Key Managerial Personnel

- - 0.08 0.08


- - (-) (-)V N HEGGADE - - 0.04 0.04

- - (-) (-)Guarantees and Collaterals Outstanding - 164.04 - 164.04


- (65.93) - (65.93)Gammon CMC - 57.55 - 57.55

- (48.18) - (48.18)SINGLA JV - 45.35 - 45.35

- (34.98) - (34.98)Outstanding Balances Receivables 149.46 267.76 - 417.22

(107.16) (202.47) - (309.63)Gammon India Limited 138.88 - - 138.88

(107.16) - - (107.16)Gammon India Limited - Debtor 10.58 - - 10.58

(-) - - (-)Gammon Cidade Tensacciai - 46.11 - 46.11

- (44.13) - (44.13)GIL Archirodon - 22.40 - 22.40

- (61.65) - (61.65)Gammon CMC - 12.38 - 12.38

- (-) - (-)Patel Gammon - 33.62 - 33.62

- (33.62) - (33.62)Jager Gammon JV - 153.25 - 153.25

- (63.07) - (63.07)Outstanding Balances Payable 2.08 1.52 - 3.60

(41.60) (19.39) - (60.99)Gammon India Limited - Creditor 2.08 - - 2.08

(41.60) - - (41.60)Gammon CMC - 0.69 - 0.69

- (-) - (-)Indira Container Terminal Pvt Ltd - - - -

- (8.27) - (8.27)SINGLA JV - 0.83 - 0.83

- (11.12) - (11.12)

(Previous Period figures are in brackets) Transactions pertaining to contract revenue and contract expenses with related parties are made on terms equivalent to those

that prevail in arm’s length transactions. Outstanding balances at the year-end are unsecured . This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

(Rupees in Crore)

Gammon Engineers and Contractors Private Limited

Registered Office: ‘Gammon House’, Veer Savarkar Marg,

Prabhadevi, Mumbai – 400025

Tel: +91 22-6115 3000, Fax: 91 22-2430 0221

E-mail: [email protected]

Website: www.gammonengineers.com

CIN: U45100MH2014PTC260191

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