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R E G I S T E R E D O F F I C E
Punj Lloyd Ltd.Punj Lloyd House, 17-18 Nehru Place, New Delhi 110 019, India
T +91 11 26466105 F +91 11 26427812
www.punjlloyd.com
C O R P O R AT E O F F I C E I
78 Institutional Area, Sector 32, Gurgaon 122001, India
T +91 124 2620123 F +91 124 2620111
C O R P O R AT E O F F I C E I I
95 Institutional Area, Sector 32, Gurgaon 122001, India
T +91 124 2620123 F +91 124 2620777
Simon Carves Ltd.Sim Chem House, Warren Road, Cheadle Hulme, Cheadle
Cheshire SK8 5BR UK
T +44 161 486 4000 F +44 161 486 1302
Sembawang Engineers & Constructors Pte. Ltd.460 Alexandra Road, PSA Building Unit 27-01
Singapore 119963
T +65 6305 8788 F +65 6305 8568
S O U T H A S I A
Punj Lloyd Ltd.Banmore Industrial Area, Banmore
District Morena 476444, MP, India
T +91 7532 243644
F +91 7532 243297
Punj Lloyd Ltd.1 TV Industrial Estate
S K Ahire Marg, Worli
Mumbai 400 025
T +91 22 66602835
F +91 22 24936861
A S I A PA C I F I C
PT. Punj Lloyd Indonesia Ventura Building, 4th Flr.
Suite 401B Jl. R A Kartini 26 Cilandak
Jakarta 12430 Indonesia
T +6221 75 91 4766
F +6221 75 914 241
Punj Lloyd Pte. Ltd. 25 International Business Park
#04-18/19 German Centre
Singapore 609916
T +65 6562 9042 / 43
F +65 6562 9044
asiapacifi [email protected]
Punj Lloyd Ltd. 6th Flr., 68 Hoang Dieu Street
Ward 12, Distt. 4, Ho Chi Min City
Vietnam 115 093
T +84902410951
C E N T R A L A S I A
Punj Lloyd Kazakhstan LLP 11 B, Srym Datov Street
Atyrau, Kazakhstan
Republic of Kazakhstan
T +7 3122 35 46 48 / 57 / 58 / 59
F +7 3122 354687
M I D D L E E A S T
Punj Lloyd Ltd.PO Box 28907
501-504 Al Gaith Tower
Hamdan Street, Abu Dhabi, UAE
T +971 2 6261604
F +971 2 6267789
Punj Lloyd Ltd.PO Box 55174, #6, 2nd Flr.
Hussain Fikri and Sons Building
C - Ring Road, Doha
State of Qatar
T/F +974 427 0822
Punj Lloyd Ltd.PO Box 704, Postal Code 133
Al Khuwair, Sultanate of Oman
T +968 24 597728
F +968 24 597493
Punj Lloyd Ltd.PO Box 50082, Mukkalla
Republic of Yemen
T +967 5 384 386
F +967 5 212 022
Dayim Punj Lloyd ConstructionContracting Co. Ltd. P O Box 31909, Al Khobar 31952
Kingdom of Saudi Arabia
T +966 3 864 9141
F +966 3 864 6990
A F R I C A
Punj Lloyd Ltd.PO Box 3119, Goth
Ashaal Alwahda Area
Tripoli - G.S.P.L.A.J
Tripoli, Libya
T/F +218 21 438 5545
Oil & Gas • Petrochemicals • Process Industries • Power
Utilities • Transportation • Hi-spec Buildings • Asset Management
Annual Review 2006-07
Our VisionTo be among the top fi ve EPC companies
in the markets we serve by the year 2012
Our PledgeSafety of People Protection of Environment
Quality of Service Success of the Project
Assurance of Speed Control of Costs
Section I
2 > Engineering Global Value
4 > Letter from the Chairman
8 > Board of Directors
10 > Punj Lloyd Group Profi le
12 > Solutions Portfolio
14 > Milestones
16 > Global Spread
17 > Clientele
18 > 06-07 Highlights
20 > Sembawang Engineers and Constructors
22 > Simon Carves
24 > Key Figures
Section II
25 > Management Discussion and Analysis
34 > Directors’ Report
57 > Auditors’ Report
61 > Balance Sheet, Profi t and Loss Account, Schedules
75 > Notes to Accounts
100 > Cash Flow Statement
102 > Auditors’ Report on Consolidated Accounts
104 > Consolidated Balance Sheet, Profi t and Loss Account, Schedules
118 > Notes to Accounts (Consolidated)
140 > Cash Flow Statement (Consolidated)
| 2 |
Engineering Global Value
Our rich experience and
knowledge makes us the ideal
development partner in the
energy and infrastructure sectors.
We continue to strengthen our
presence and enhance our
value across the globe. We have
undertaken large scale projects
across South Asia, Asia Pacifi c,
the Middle East, parts of Europe,
Africa, China and the Caspian
region. Out of a total revenue of
Rs 52,060 million, India accounts
for Rs 16,660 million (32%).
Today we have 16 international
offi ces, a multicultural workforce
of 6,000 plus that service
clients worldwide.
Our track record of having
completed a variety of large
projects across the engineering,
procurement and construction
space with several highly
regarded international entities and
our continuous initiation of new
relationships, are a refl ection of
the value proposition we bring to
the table and the high degree of
confi dence our clients place in us.
As we build, we concentrate on
sustainable development, effi cient
use of resources and safety at
the workplace.
Whether it’s laying a pipeline in the
deserts of Oman or Kazakhstan,
constructing an offshore
platform in India or a deep tunnel
sewerage system in Singapore
or specialised process units like
the Visbreaker or Hydrocracker,
we go an extra mile. We have
developed a reputation for
undertaking challenging EPC
projects and completing them
ahead of schedule.
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 3 |
As I look out of the window in
my offi ce, my mind fl ashes
back to the day we laid our fi rst
pipeline from Bombay to Pune
in 1985. The 160 km stretch was
then considered to be the most
challenging pipeline project
in India.
Though it seems recent, it has
been 22 long years, and since
then we have laid over 8,000
km of pipelines, not just in India,
but across the globe. Today,
we have 16 international offi ces
spread across the Middle East,
the Caspian, Asia Pacifi c, Africa,
South Asia, Europe and China.
We have worked in as many as
60 countries.
More importantly, today we don’t
just lay pipelines; in oil and gas
we’ve worked on wellhead and
process platforms, built in excess
of 8 million m3 of storage capacity
ranging from cryogenic to fl oating
and fi xed roof storage tanks for
oil, gas, and water. We have
experience in petrochemicals
and in complex process units
such as crude distillation units,
hydrocracker and visbreaker
units, motor spirit upgradation
and sulphur recovery blocks.
Letter from the Chairman
Our contribution to the
development of urban
infrastructure ranges from mass
rapid transit/light rail transit
systems to airports, and power
plants to marine facilities such as
jetties, drydocks and wharves.
We are in a unique position to
offer end-to-end solutions ranging
from feasibility studies through
detailed design and engineering
project management and
construction.
To cut a long story short, Punj
Lloyd today offers a variety of
Engineering, Procurement and
Construction (EPC) solutions to its
clientele across the globe.
Fiscal 2007 has been a milestone
year for your company. Not only
did we enhance our reach in the
global market (as evidenced by
our ever-expanding order-book
position), we also successfully
expanded our EPC solutions
portfolio.
Extending Our Global Footprint – Our Strategic Acquisitions in 2006-07
In June 2006, Punj Lloyd
acquired SembCorp Engineers
and Constructors, now called
Sembawang Engineers and
Constructors, along with its
wholly-owned subsidiary, Simon
Carves of UK.
| 4 |
> Sembawang is one of the
largest engineering and
construction companies in
South East Asia focusing on
urban infrastructure (Mass
Rapid Transit systems,
Light Rail Transit systems,
Airports, Highways &
Expressways, Bridges,
Flyovers and Interchanges,
Tunnels and Caverns. Port
Facilities including Jetties,
Drydocks and Piers) and Hi-
spec buildings (Residential,
Commercial, Industrial and
Hospitality).
> Simon Carves is the world’s
No. 1 engineering contractor
for LDPE with a wide range
of polymer and petrochemical
project experience. It also
has signifi cant experience in
chemicals and is focusing
on the upcoming areas of
biofuels and nuclear power.
The acquisition has added to our
repertoire of services, especially
in the infrastructure domain. Our
overall capabilities now include
petrochemicals, hi-spec buildings,
jetties, tunneling, airports, and
MRT/LRT among many others.
The group has made rapid
progress up the value chain, with
average ticket size of the order
increasing manifold. This enables
us to manage large projects
without commensurate increase
in resources, enabling higher
margins in the process.
Dear Fellow Stakeholders,
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 5 |
In 2006-07, we received
new business contracts from
customers on the basis of our
extended capabilities and overall
group experience. The acquisition
has also added a very large
number of experienced and
qualifi ed engineers to our existing
talent pool.
Your company is well on its way
to becoming a leading global EPC
company.
Financial & Operating Review
All our businesses reported a
robust performance for the year.
Our strong performance was
underpinned by stable earnings
from long-term contracts
and repeat customers, while
new contracts across various
geographies provided the impetus
for further growth.
Last year, we formulated a
strategy to focus our operations
on businesses and markets
that would deliver sustainable
earnings and growth. Our 2006-
07 performance highlights the
success of our strategy.
During the year under review,
our Group recorded robust
growth in sales, earnings, and
order booking. Consolidated
revenues for the year amounted
to Rs 52,060 million, 203% more
than that earned a year ago.
The growth in sales was well
complemented by an even better
performance at the profi t level.
Reckoned year-on-year, profi ts
at the operating level witnessed
a jump of 120% to Rs 4,897
million while at the net level it
witnessed a growth of 263% to
Rs 1,960 million.
Our order book expanded by
266% to Rs1,59,439 million in
fi scal 2007, rendering greater
visibility to our revenue stream for
the ensuing years.
The expansion in order book
was largely a result of our
foray into newer domains. In
essence, our strategic decision
to acquire Sembawang is already
bearing fruit.
In 2006-07, we procured several
contracts for the oil and gas and
infrastructure from India and the
Middle East, where the major
projects are in countries like
UAE, Qatar, Saudi Arabia, Oman,
Bahrain and Yemen.
Our global reach has expanded
substantially over the past few
years. It is with pride that I inform
you that today Punj Lloyd is
truly a global entity. In terms of
geographical contribution, our
current order book comprises
41% domestic contracts and
59% international contracts, with
56% to be executed in South
East Asia, 29% in the Middle East
and Africa and 15% in the rest of
the world.
In terms of business segments,
petrochemicals represent 11% of
our current order book, followed
by oil and gas (64% share).
Projects in the civil engineering,
infrastructure and power domains
account for the rest.
Engineering Value
In the face of stiff competition
and strict pre-qualifi cation
requirements, your company
bagged many high profi le projects
in 2006-07. Some of the high
value, high margin projects are
enlisted below:
> A prestigious order from Oil
and Natural Gas Corporation
(ONGC) to build an offshore
platform. Our comprehensive
capabilities helped us meet
their strict pre-qualifi cation
criteria and secure our single
largest offshore platform
project.
| 6 |
> An order from the Ensus
Group to design and
construct one of the world’s
largest bio-ethanol production
facilities in UK. The plant
will be the fi rst world scale
facility to be built in the UK
and marks a major step in
meeting the country’s bio-fuel
obligations.
> Two contracts on an EPC
basis for the Hydrocracker
(capacity 1.7 MMTPA) and
Hydrogen Generation Unit
(capacity 70,000 TPA) for
Indian Oil Corporation’s
refi nery project at Haldia (West
Bengal). This is the largest
EPC contract for a process
unit won by your company
and is also the fi rst one to
be executed by an Indian
engineering company. More
importantly, this project has
catapulted Punj Lloyd into
the league of select global
EPC contractors to work on
a hydrocracker unit on an
EPC basis. Hydro-cracker
is one of the most complex
process units in a refi nery with
pressures and temperatures
approximating 250 bar and
300-350 deg C respectively.
We remain dedicated towards
the development of domain
expertise and technical know-
how of our employees. Our
innovative and diverse workforce
is handpicked and has the will
to take on challenges and see
them through. With diverse
projects spread all over the world,
our engineers have generated
multi-disciplinary skills and a wide
range of experience in project
management and execution.
Last but not the least, your
company is run by a professional
set-up that comprises some of
the best and most experienced
minds in the industry and their
presence has been instrumental
in the growth of our operations.
Promising Outlook
In 2006-07, we developed
new markets, gained new
customers, built further on our
strong market position and
added muscle to our offerings
(by acquiring Sembawang). Our
operations and performance have
demonstrated our ability to deliver
sustainable earnings and growth.
Our order-book position, which
is considered an indicator of
future performance, continues
to expand. As of 30th May 2007,
it stood at Rs 159 billion (USD
3.87 billion).
> Pipeline project from Sirte
Oil Company, Libya on an
EPC basis, which is our fi rst
major contract in the African
continent.
Best-in-business people
On global EPC contracts, we
have worked on some of the
most diffi cult terrain in the world
and executed our projects
successfully. Our success is
in large part a result of our
employees’ commitment and
passion for what we do. Their
health and safety is of paramount
importance to us.
We strive to minimize accidents
and occupational health hazards
through systematic analysis and
control of risks and by providing
appropriate training to employees,
subcontractors, and communities.
We strongly encourage the
adoption of occupational health
and safety procedures as an
integral part of our operations and
have been certifi ed as compliant
with the Occupational Health
and Safety Management System
Standard OHSAS 18001.
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 7 |
The composition of these
contracts is a refl ection of our
endeavor to focus not just on
order-book additions but to bid
for and execute projects that
create value for our customers
and shareholders.
Your company won several high
profi le projects in 2006-07 and
given that our strengthened profi le
pre-qualifi es us to bid for much
larger and more complex projects,
we expect signifi cant expansion
in both volumes and higher-value
components of our operations.
We also received repeat orders
from some of our domestic
and overseas customers refl ecting
their underlying confi dence
and trust in our operations
and expertise.
Going forward, we will continue
to sharpen our focus on
businesses that deliver
sustainable value and focus on
moving up the value chain.
A note of thanks
On behalf of the Board, I would
like to thank our employees for
their dedication and persistent
hardwork towards making Punj
Lloyd a Global Engineering
Success. I would also like to
express my appreciation to our
customers, partners and business
associates for their support and
the vital role they play in our
success.
Last but not least, I would like
to thank all the shareholders for
their continued confi dence in Punj
Lloyd.
Together with the management
team, I am confi dent that we
are well-positioned to meet the
challenges of the future and to
engineer global value for our
stakeholders, employees, and
customers in a sustainable way.
Yours sincerely,
Atul Punj
Chairman
Board of Directors
Atul Punj Chairman
Vimal Kishore Kaushik Managing Director
Luv Chhabra Director - Corporate Affairs
Scott R Bayman Independent Director
Pawan Kr Gupta Whole Time Director
Naresh Kr Trehan Independent Director
Rajan Jetley Independent Director
Sanjay Gopal Bhatnagar Independent Director
| 8 |
SNP Punj
Chairman (Emeritus)
Company Secretary
Dinesh Thairani
Auditors
S R Batliboi & Co.Chartered Accountants
Bankers
Allahabad Bank
Arab Bank plc
Bank Muscat
Canara Bank
Central Bank of India
Centurion Bank of Punjab
Citibank N.A.
Commercial Bank of Qatar
DBS Bank Ltd
Deutsche Bank AG
Development Credit Bank Ltd
Doha Bank
Dubai Islamic Bank
Export - Import Bank of India
Federal Bank Ltd
HDFC Bank Ltd
HSBC Bank Middle East Ltd
ICICI Bank Ltd
IDBI Bank Ltd
Indian Bank
Indian Overseas Bank
IndusInd Bank
ING Vysya Bank
Mashreq Bank psc
Oriental Bank of Commerce
Punjab National Bank
Standard Chartered Bank
State Bank of Bikaner and Jaipur
State Bank of Hyderabad
State Bank of India
State Bank of Indore
State Bank of Patiala
The Karur Vysya Bank Ltd
UCO Bank
Union National Bank
United Bank of India
Vijaya Bank
Yes Bank Ltd
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 9 |
| 10 |
Punj Lloyd
Oil & Gas/Infrastructure
Simon Carves
Refi nery & Process
Polymers & Petrochemicals
Bio-fuels
Sembawang
Hi-spec Buildings
Urban Infrastructure
Punj Lloyd is an international EPC group
and a leader in the Energy and Infrastructure
space. Our sophisticated equipment and
skilled employee resources, together with
our strong engineering capabilities enable
us to successfully implement fully integrated
solutions from design to delivery.
We remain strongly committed to health, safety
and environmental practices in the execution of
our projects and have received several awards
and certifi cations from our clients world-wide.
Persistent repeat orders from our clients is
testimony of our efforts.
In terms of scale of operations, we recorded
consolidated sales of Rs 52,060 million in
2006-07, have an order-book of Rs 159,439
million, a presence across as many as 60
countries, and employ over 6,000 people.
Strategically, we remain focused on expanding
our global reach and executing high value
projects. Our global presence encompasses
the fast-growing regions of South Asia, the
Middle East, the Asia Pacifi c, Africa, Europe,
China and the Caspian region.
The acquisition of Sembawang Engineers &
Contractors (along with Simon Carves, UK)
in fi scal 2006 was one of major strategic
initiatives towards the expansion of our
global reach. This acquisition has enhanced
our existing portfolio of services by adding
complementary segments, and has enabled us
to qualify for higher value projects in attractive
markets globally.
In a bid to boost our engineering skills
and service offerings in India, which itself is
in the midst of a major investment boom,
Simon Carves India has been set up. Besides,
providing engineering services to the Punj
Lloyd Group, Simon Carves India will also
provide engineering services to
other industries.
Punj Lloyd Group Profi le
| 11 |A n n u a l R e v i e w 2 0 0 6 - 0 7
Oil & Gas
Wellhead and Process Platforms, Gas Processing, Pipelines, Tankage & Terminal
Process
Refi neries, Polymers & Petrochemicals, Chemicals, Pharmaceuticals, Renewables
Power
Thermal, Nuclear
Our Solutions Portfolio
| 12 |
Transportation
Mass Rapid Transit/Light Rail Transit (MRT/LRT) systems, Airports, Highways & Expressways,
Bridges, Flyovers & Interchanges, Tunnels & Caverns. Port facilities including Jetties, Drydocks,
Piers, Wharves and Container Terminals
Hi-spec Buildings
Hospitality and Leisure, Commercial Complexes, Industrial, Residential, Healthcare and
Institutes
Asset Management
Plant & Facility, Maintenance & Operation
Telecom & Broadband
Laying of OFC, Installation of TV Towers
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 13 |
MILESTONES
1985 •1st pipeline project (Bombay-Pune, India)
1992 •1st overseas contract (Balongan-Jakarta Product Pipeline, Indonesia)
1993 • 1st Middle East contract (Jarn Yaphour Field Development, Abu Dhabi)
1994 •Longest stretch of pipeline 557 km (Kandla-Bhatinda, India)
1995 •1st EPC contract in oil & gas sector (Gas Field Development, India)
1996 •1st overseas pipeline contract in swamp and shallow water (Tunu Field Development EPSC 4 and 5, Indonesia)
1st overseas EPC pipeline contract in offshore (Balongan-Jakarta Product Pipeline, Indonesia)
| 14 |
• 1999 1st road project (Vadodara-Halol Tollway, India)
• 2002Entry into Caspian region (KAM Pipeline, Kazakhstan)
2004 •EPC tank contract in Asia Pacifi c (Bulk Liquid Terminal, Singapore)
• 20051st Thermal power project (Jindal, India)
• 2006Added hi-spec building and urban infrastructure like airports, jetties, Mass Rapid Transit, Light Rail Transit (MRT/LRT) systems, hotels, resorts, golf clubs etc with the acquisition of SembawangAdded polymers & petrochemicals, chemicals, biofules, nuclear power with the acquisition of Simon Carves Entered into new region (Libya)
• 20071st Offshore platform (Heera Redevelopment, India)
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 15 |
Global Spread
With 16 international
offi ces, our operations
today span the globe.
We have completed
and are working on
several large projects
for leading entities
across continents.
| 16 |
IRAN
UAE SAUDI ARABIA
OMAN
UAUAE
QATAR
KAZAKHSTAN
RUSSIA
INDIA
UK
SINGAPORE
CHINA
INDONESIAE INDONESIA
MALAYSIAYEMEN
LIBYA
VIETNAM
Punj Lloyd’s impressive list of clients includes the who’s who of the global Construction industry. Many
international and national energy majors are our clients. The Group has also worked on projects for major
engineering construction companies. Owing to our track record, we receive repeat orders from several major
clients in different countries. Some of our current clients are listed below:
Our Clientele
SABIC UK Petrochemicals
PTT Polyethylene Co Ltd
Ensus Ltd
Saudi Kayan Petrochemical Company
Amir Kabir Petrochemical Co Ltd
Essar Oil Limited
Pars Petrochemical Co Ltd
ACM China Co Ltd
AMCO JV
Asendas (Tianjin) Co Ltd
Ao Zhong Development Co Ltd
C Steinweg Warehouse (FE) Pte Ltd
Fokker Elmo (Langfang) Electrical
System Co Ltd
GE Hualum Medical Systems Co Ltd
Genting International
GESCO Corporation Ltd
Global Health Pte Ltd
Godrej Properties Ltd
Himoinsa China Co Ltd
Land Transport Authority, Singapore
LC Ventura (Tampines) Pte Ltd
Mizuno China Co
Nakheel Properties
Powai Developers
Pyramid Hill Properties Pte Ltd
Riffa Golf & Residential Development
Satyam Computer Services Ltd
Singapore Airport Terminal Services
Singapore Ministry of the Environment
Singapore Public Utilities Board
ST Aerospace Engineering Pte Ltd
ST Aviation Services Co Pte Ltd
Storehub Self Storage Pte Ltd
The Great Eastern Shipping Co
The National University of Singapore
Tianjin Ao Zhong Development Co Ltd
Tianjin Consco Property Development
Torishima Ltd
ADCO
AGIP KCO
Aramco Overseas Co
Dolphin Energy Ltd
Eastern Bechtel Co Ltd
Helios Terminal Corporation Pte Ltd
Horizon Singapore Terminals Pte Ltd
IHI
Oman Gas Company
PT Perusahaan Gas Negara
Qatar Petroleum
Ras Laffan Olefi ns Company
Sirte Oil Company
SNC Lavalin International
Tankstore
TotalFinaElf E&P Indonesie
Yemen LNG Co Ltd
ONGC
DMRC
GAIL
Global Health Pvt Ltd
ICICI
IOCL
Jindal Power Ltd
NHAI
Rajasthan Rajya Vidhyut Utpadan
Nigam Ltd
Ratnagiri Gas and Power Pvt Ltd
Reliance Gas Transportation
RIDCOR
International Clients
Domestic Clients
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 17 |
Punj Lloyd acquired SembCorp E&C (now called
Sembawang Engineering and Constructors Pte Ltd)
Singapore, one of the largest engineering and construction
in South East Asia along with its wholly owned subsidiary
Simon Carves Ltd, an established process engineering
contractor based in UK. Last year, Sembawang E&C and
Simon Carves recorded revenues of over USD 1 billion and
USD 350 million, respectively.
Simon Carves signed a Letter
of Intent (LOI) to build a new
300 ktpa LDPE plant in Saudi
Arabia for the Saudi Kayan
Petrochemical Company.
Punj Lloyd set up an engineering back offi ce in Delhi, Simon Carves India Ltd with strengths in innovative engineering and design services.
Entered into a joint venture with
Swissport International, a world
leader in the aviation ground and
cargo handling sector operating
in 41 countries across the world.
Sim
of I
30
Ar
P
neeriiringng b back office in Delhi
Entered into a joint venture
with KAEFER GmbH,
Germany, a world leader
in the insulation business
for developing innovative
insulation solutions.
in 41 countries acros
E
w
G
in
Punj Lloyd unveiled its new corporate identity for the group. The new brand identity signifi es Punj Lloyd’s evolution as a global energy and infrastructure services provider, in the light of its recent international acquisitions. ntered into a joint venture E
Simon Carves signed a large contract for construction of a LDPE plant at Thailand.
| 18 |
2006-07 Highlights
Punj Lloyd secured its largest project worth Rs 3.5 billion to date for its tankage and terminal business from Indian Oil Corporation for
its naphtha cracker project at Panipat, Haryana.
Oil its nprojHary
Punj Lloyd secured its fi rst contract in
Africa from Sirte Oil Company, Libya
for pipeline projects on an EPC basis.
This project worth Rs 13.5 billion is
also the single largest contract won
by the Company.
Punj Lloyd securei
Sembawang Engineers and Constructors
entered into agreement with Riffa Golf
and Residential Development Company
of Bahrain to construct 325 villas of a
residential community.
Sem
ente
and
of B
resid
The Company won two contracts for Indian Oil Corporation’s refi nery project, Haldia, West Bengal worth Rs 11.6 billion. The hydrocracker contract valued at Rs 8.6 billion makes Punj Lloyd the fi rst Indian Company to execute a hydrocracker contract on an EPC basis.
Ll d secured its fi rst contrac
ib
Punj Lloyd, with its offshore engineering
arm - PT Sempec Indonesia, secured its
single largest Offshore Platform Project -
Heera Redevelopment Project on an EPC
basis from Oil & Natural Gas Corp Ltd
(ONGC).
Pu
ara m
ssis n
HHHe
bbbbab s
(((OOO( N
Punj Lloyd entered into a joint
venture with HRH Prince Khalid
Bin Bandar Bin Sultan, Kingdom
of Saudi Arabia to establish a
jointly owned company to engage
in civil and industrial projects.
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 19 |
| 20 |20
Sembawang Engineers & Constructors Pte Ltd
The acquisition of Sembcorp E&C (now
Sembawang Engineers and Constructors)
has widened Punj Lloyd’s canvas and not only
deepened its presence in existing markets but
also given it access to develop new markets.
Because of the acquisition, Punj Lloyd’s
average ticket size of orders is on the rise,
implying suffi cient execution capability with
available resources.
Punj Lloyd’s capabilities now include airports,
jetties, mass rapid transport/ light rail
transport, hi-spec buildings and tunneling
amongst others, in the infrastructure domain.
Enabled by extended capabilities, Punj Lloyd
is now also pre-qualifi ed for larger and more
complex project bids.
The Heera Development Project order
received from Oil and Natural Gas
Commission (ONGC) in January 2007 is
an example of such a successful bid as PT
Sempec, a Sembcorp E&C Company that
won the order possessed the necessary
qualifi cations to bid for the project.
Amongst its recent projects, Sembawang
Engineers and Constructors is also building
the villas for Riffa Golf and Residential
Development Company of the Kingdom of
Bahrain at a cost of Rs 5.42 billion.
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 21 |
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Simon Carves Ltd
Simon Carves, founded in 1881, has provided
its clients over 125 years of professional
excellence. It offers a full range of process
design and engineering services to the oil,
gas and downstream chemical engineering
industry worldwide and provides end-to-
end solutions including basic and detailed
engineering, front end engineering design,
procurement services, and construction
services. Simon Carves has completed over
4,000 capital projects to date in 50 countries.
Simon Carves has strong petrochemical
sector capabilities with a global leadership
position in all types of polymerization
processes particularly for LDPE and HDPE.
Amongst its many achievements, Simon
Carves has built more than 350 sulphuric acid
plants worldwide.
The company is currently working on a LDPE
project in Teesside, UK. This design is based
on state-of-the-art technology and when built,
will be the largest single stream LDPE plant in
the world, producing 400,000 tons of product
per year.
Simon Carves has also received an order from
the Ensus Group to design and construct
the world’s largest wheat based bio-ethanol
production facility in England.
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 23 |
Key Figures
Consol idated Results
0
100
200
300
400
500
2004 2005 2006 2007
Ye a r
Profit before Interest,Depreciation & Tax
495.68
199.92
364.74
222.88
0
50
100
150
200
2004 2005 2006 2007
Ye a r
105.41 100.11
53.95
196.04
Profit after Tax
CAGR 16.78%
CAGR 16.78%
CAGR 60.57%
0
1000
2000
3000
4000
5000
6000
2004 2005 2006 2007
Rs
in
c
ro
re
sR
s in
c
ro
re
s
Ye a r
1618.711920.33
1716.59
5212
Gross Revenue
Ye a r
0
300
600
900
1200
1500
2004 2005 2006 2007
193.28
511.81
1122.42
1284.76
Net Worth
Rs
in
c
ro
re
sR
s in
c
ro
re
s
CAGR 60.57%
| 24 |
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 25 |
Management Discussion and AnalysisEconomic Overview
India’s GDP grew at 9.4 per cent in 2006-07, its highest in recenttimes. This comes on the back of an equally robust 9 per centgrowth recorded in the last fiscal.
GDP growth in 2006-07 was essentially led by the manufacturingsector, which grew by 12.3 per cent (compared to 9.1 per centin 2005-06). Growth in the Services sector too witnessedacceleration (up from 9.8 per cent in fiscal 2005-06 to 11 percent in 2006-07).
The twin engines of this robust growth have been investmentsand consumption, both of which, given their current trend,appear well poised for an encore in 2007-08.
Foreign direct investment increased to USD 16,000 million andexports recorded an impressive growth of 23.9 per cent to USD124,600 million in 2006-07. Foreign exchange reservescontinued their ascent and crossed the USD 200,000 millionmark.
With India’s per capita disposable income currently at USD 556per annum and expected to double by 2015, the Indian economyappears set to maintain its momentum in the future. Strongcorporate performance combined with a conducive macro-environment is reflecting a healthy uptrend in the secondarymarket.
The infrastructure sector has been expanding significantly. Theoverall index of six core infrastructure industries that largelyreflect the undercurrent of the economy, registered a robustgrowth of 8.6 per cent in 2006-07, compared to a 6.2 per centincrease in 2005-06.
The Government is actively pursuing Public Private Partnerships(PPPs) to bridge the infrastructure deficit in the country. Severalinitiatives have been taken to promote PPPs in sectors likepower, ports, highways, airports, tourism and urbaninfrastructure.
The outlook going forward remains optimistic although thegrowth rate may rationalise owing to a higher base, hardeningof interest rates and an unpredictable scenario of energy andcommodity prices.
BUSINESS SEGMENTS
Oil & Gas
Punj Lloyd provides comprehensive engineering, procurementand construction services to the Oil and Gas sector whichincludes the setting up of complex storage tanks and terminals,refinery and process facilities, cross-country oil and gaspipelines, offshore pipelines and platforms.
Pipelines
Today, Punj Lloyd is the leading pipeline contractor in Asia witha significant international presence. The Company is an all
terrain specialist having laid pipelines in the most demandingand challenging areas around the world.
With global demand for energy rising at a rapid pace along withsubstantial discoveries of gas, the need to transport crude oiland gas for refining, storage and transportation has increasedmanifold. There are numerous major pipeline projects beingplanned and built across the globe. According to Simdex, anagency that monitors pipeline projects across-the-globe, totalpipeline projects planned over the next few years totaled246,473 km., as of May 2007. Given the rising demand, andtherefore higher investments in the Asian region led by Indiaand China, pipeline investments in Asia dominate with a 33 percent share in total pipeline projects.
Punj Lloyd has laid in excess of 8,000 km. of cross-countrypipelines for hydrocarbons and water services. The Companyhas the resources, experience and expertise to provide EPCsolutions for pipeline projects upto 56” in diameter in terrainssuch as deserts, rain forests, rocky and marshy areas.
The Company’s fleet of equipment includes shallow water pipelaying barge, a push pull pipe laying barge, 4 Nos. of HDD rigsof capacity upto 400mt and 11 Automatic Welding Stations (atechnology introduced by Punj Lloyd), 160 Side Booms andmore than 200 excavators.
In India, an increase in the domestic demand for energy, therecent discovery of large oil and gas reserves in various partsof the country and the Government’s decision to permit oilretailing by the private sector have led to the demand for ahuge pipeline network covering the whole nation. Companieslike GAIL and Reliance Industries plan to make investment inthe region of Rs. 300,000 million in a pipeline grid across thecountry that will stretch 10,000 km. Other companies such asIOCL, ONGC, HPCL, BPCL and Gujarat State Petronet haveannounced similar plans.
Punj Lloyd’s core competence and experience in layingpipelines, give it an enviable position in the energy transportationbusiness. The Company is currently executing five majorpipeline construction works in India alone. For 2006-07, PunjLloyd bagged onshore orders worth Rs. 5,932 million and anoffshore pipeline order worth Rs. 13,037 million. The offshorepipeline order is for the Heera Redevelopment project fromONGC. The project involves design and detailed engineeringand off-shore installation of 4 Wellhead Platforms, 57 Km RigidPipeline, and a 10.5 Km Flexible Pipeline.
Further, the Company’s experience and technological acumenled to a rise in new pipeline laying orders, especially from theMiddle-East and its first ever order from a new market – NorthAfrica. Punj Lloyd received an order of USD 290 million fromSirte Oil Company, Libya, on an EPC basis, which is the largestsingle contract ever won by the Company.
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Storage Tanks and Terminals
The market for LNG has been growing at a tremendous pacespanning all the continents. Within the Indian region, growth inLNG demand is strong and expected to stay strong through thenext decade owing to increasing demand for electricity and forindustrial usage. New projects have led to a boom in the LNGmarket and resultantly for setting up storage tanks and terminals.Transportation of Oil & Gas has also spurred the setting up ofstorage tanks and terminals.
Punj Lloyd is an acknowledged storage system EPC companyhaving successfully executed projects in India and abroad. Theclient list includes major public sector undertakings, Oil & Gasmajors and multinational engineering & constructioncompanies. Till date the Company has built in excess of 6 millioncubic meters of storage capacities. Punj Lloyd Group’sexperience in tankage and terminals extends from theconstruction of cryogenic to floating and fixed roof storage tanksfor oil, gas, and water, and EPC capabilities, including insulationin LNG Tanks. The Company leverages its in-house projectmanagement and EPC capabilities to take on tank and terminalmega projects.
Process Plants
Proven capabilities in turnkey & composite construction havemade Punj Lloyd a leader in the process plant engineering,procurement and construction business. Oil and gas companiesrequire various process facilities in the production and refiningof oil and gas and derivative products.
The Company’s clients have recognized Punj Lloyd’s trackrecord in delivering plants which provide guaranteedperformance and demonstrate high reliability, low maintenancerequirements and low overall life cycle costs.
The Company has a chain of successful projects on portfolio, inthe Indian sub-continent, Middle East, South East Asia, andCIS countries. Punj Lloyd’s acquisitions of SembawangEngineers and Constructors Pte Ltd and Simon Carves Ltd hasadded significantly to its processing capabilities and increasedits scale of operations.
Consolidated list of Major Domestic Projects under executionand awarded to Punj Lloyd Group during the year:
Name of the Project Value of Project(INR Mn)
PIPELINES
Dahej-Hazira-Uran Pipeline Project, GAIL 1371.97
Backwater & Onshore Pipeline For Crude 399.81Oil Receipt Facilities Project, KRL
Fabrication & Laying of 750NB & 400 NB 86.95Pipelines by HDD method, KRL
Dabhol-Panvel Pipeline Project, GAIL 1642.40
Uran-Trombay Gas Pipeline Project, 2419.63ONGC
Name of the Project Value of Project(INR Mn)
Mundra-Delhi Product Pipeline Project, 1148.83HPCL
Loni-Solapur Product Pipeline Project, 760.00HPCL
Manglia-Piyala Product Pipeline Project, 804.61BPCL
TANKAGES & GENERAL CONSTRUCTION
Phase II of EPC-I Package for Completion 2190.60of Balance Works of the Top of the JettyFacilities for Ratnagiri LNG TerminalProject, RGPPL
EPC Contract for Storage Facilities 3400.96(Part of EPCC-8 Package) of PanipatNaphtha Cracker Project, IOTL
Cryogenic LNG storage tanks for Petronet 1684.00LNG Terminal at Dahej.
PROCESS FACILITIES
Hydrocracker Unit at IOCL’s Haldia 9985.60Refinery, (EPCC-1), IOCL
Hydrogen Generation Unit at IOCL’s 3466.70Haldia Refinery, (EPCC- 2) IOCL
New Doha International Airport 6180.00Extension – EPC work for a fuel system
OFFSHORE
Heera Redevelopment Project, ONGC 13037.50
Consolidated list of Major Overseas Projects underexecution and awarded to Punj Lloyd Group during the year:
Name of the Project Value of Project(USD Mn)
PIPELINES
EPC Pipeline Project in Libya from Sirte 290.00Oil Company
Doha Urban Pipeline Relocation Project 182.00in Qatar from Qatar Petroleum
EPC of Oman Gas Company Pipeline 125.00Kashagan Development Project 79.00
Dense Phase Ethylene and Butene 44.90Pipeline Project from Ras Laffan OlefinsCompany, Qatar.
Abu Dhabi (AGD 2 / OGD 3 Pipelines) 29.98
South Sumatra West Java Pipelines 47.00
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 27 |
Name of the Project Value of Project(USD Mn)
TANKAGE & GENERAL CONSTRUCTION
Construction of utilities and offsites for 69.20LNG plant in Republic of Yemen fromYemen LNG Company Ltd.
Construction for Phase 2 of Bulk Liquid 10.92Products Terminal on Jurong Island,Singapore by Horizon Terminal Limited,Singapore
Procurement and Construction of Storage 25.50Tanks and other work for Bulk LiquidStorage and Blending facility at Meranti,Jurong Island, Singapore by HeliosTerminal Corporation Pte. Ltd.
Tankage and Foundation work for Phase 32.273 of the Bulk Liquid Products Terminalon Jurong Island, Singapore by HorizonTerminal Ltd., UAE
Power
India’s power sector is a potential high growth area. With aninstalled generation capacity of 123 GW, generation of morethan 600,000 million kwh, and a transmission & distributionnetwork of more than 6.3 million circuit kms, India has todayemerged as the fifth largest power market in the world comparedto its previous position of eighth in the last decade.
Yet the industry continues to be characterized by powershortages. Although power generation capacity has increasedin recent years, it has not kept pace with the growth in demand.
The Government of India has set a goal to supply ‘power for allby 2012’. The investment requirement for the sector is projectedat over USD 300,000 million and the mission to supply powerto all would require a 75% increase in India’s installedgeneration capacity from the present level of 123,000 MW to atleast 200,000 MW by 2012.
To meet this goal, the Government has envisaged a manifoldincrease in the role of the private sector in the financing andoperations of the power sector. The opportunities are large inscale and many large private domestic companies are pursuinginvestments in the power sector.
Ultra mega Power projects are being launched by both publicand private entities. Respective State utilities are launchingnew power projects in their states with the objective of providingadequate power to the urban and rural houses.
Punj Lloyd is engaged in EPC services for the complete civilworks, electrical systems, mechanical packages, controls andinstrumentation of power plants. The Company providescompetitive and optimized solutions for these works on turnkey
basis which includes all facets of engineering, procurementand construction.
The Company’s engagements in the power sector todaycomprise more than 200,000 engineering hours and almost 5million construction man hours.
A prestigious contract secured in 2005-06 of 4 x 250MW ThermalPower Plant Station for Jindal Power Ltd., at Raigarh is nearingcompletion. The Company has achieved significant milestoneson the project. These includes steel fabrication & erection of14,500 MT completed in 15 months, 6,000 pile foundationcompleted in 5 months, and 125,000 cubic meters of concretingcompleted in 18 months.
This year the division has secured a large turnkey power plantconstruction project, a Greenfield 2 x 250 MW power station inRajasthan. This EPC project is worth Rs. 8,230 million.
Further, with the acquisition of Sembawang E&C and SimonCarves, Punj Lloyd is qualified to bid for larger power projects.
Consolidated list of Major Projects under execution andawarded to Punj Lloyd Group during the year:
Name of the Project Value of Project(INR Mn)
POWER
Civil contract from Jinal Power. Raigarh 2328Power Project, 4 x 250 MW ThermalPower Plants, Raigarh.
EPC contract from Rajasthan Rajya 8230Vidyut Utpadan Nigam Ltd. ChhabraThermal Power Project, 2 x 250 MWPower Plants, Rajasthan.
Infrastructure
Punj Lloyd provides EPC services for various infrastructureprojects, which include buildings, highways, flyovers, bridges,elevated railroads, metro rail stations and underground tunnels.
At present, in the domestic market, Punj Lloyd is working ontwelve highways, an elevated metro rail viaduct, and a multi-specialty hospital.
In India, infrastructure development has accelerated and iswitnessing unprecedented growth across various segments.The sector is estimated to grow at a CAGR of 15 per cent overthe next few years. The construction sector is expected to bethe biggest beneficiary of the infrastructure boom. Theopportunity in the construction sector carries great potentialwith USD 124,650 million of investments committed over thenext five years.
The growth in the infrastructure sector is being driven by a hostof factors, which include reform programs undertaken by the
| 28 |
Government to enhance investments, infrastructure projectfunding from multi-lateral agencies like the World Bank andAsia Development Bank and increased private participation.
Roads, power, and airports are expected to see rapid growth inthe near future because of initiatives of the Indian Governmentto increase private investments in these sectors.
Roads
The Government’s focus on improving road quality and roadconnectivity has brought about significant investments in roaddevelopment. The Government has set forth a National HighwayDevelopment Plan (NHDP) to upgrade India’s roadinfrastructure. The total estimated cost of this plan is USD 50,000million by 2012.
As per the National Highways Authority of India (NHAI), a totalof 23,546 kms of roads is to be constructed in the next twoyears.
Ports
India has 12 major ports and 185 minor ports spread acrossnine coastal states. Indian ports handle 90 percent of India’stotal foreign trade in terms of volume.
The Government has set a goal of USD 150,000 million forexports by the year 2008-09 to double India’s share in worldexports. As a result, the ports require capacity expansion on alarge scale.
The setting up of the National Maritime DevelopmentProgramme (NMDP) is an initiative towards enhancing thepresent capacity and modernizing the existing ports. Under theprogramme, several projects are to be completed over the nextfew years. These include projects related to port development(construction of jetties, berths etc.); procurement, replacementor upgradation of port equipment; and deepening of channels.The estimated investment for the projects is USD 13,500 million.
Airports
With the advent of low cost carriers and air travel becomingmore affordable, air traffic in India is witnessing rapid growth.Passenger traffic has grown at an average of nine percent overthe last ten years. The domestic passenger segment is likely togrow at 12 per cent per annum over the next few years.
In the past, Indian airports have suffered owing to poorinfrastructure and several constraints. In line with its objectiveof developing world class airports, the Government is invitingprivate participation for developing existing airports and buildingnew ones.
In addition to the upgradation of metro city airports, thirty-fivenon-metro airports have been identified for development bythe Government. The total investment in Indian airports isestimated to be USD 5,070 million over the next five years.
Metro Rail Projects
Indian cities have been experiencing rapid growth in populationin the last few decades. The result is extreme congestion onroads, fuel wastage and environmental pollution amongstothers. To rectify the situation, the Government of India isintroducing the rail based Mass Rapid Transit system (MRTs)in major cities like Delhi, Hyderabad, Calcutta and Bangalore.The Delhi Metro Rail Project is already under implementation.
The total investment envisaged in these projects is USD 5,700million.
Punj Lloyd is well placed with a robust order book in theinfrastructure segment. Further, with the acquisition ofSembawang E&C, the Company expects to receive high-valueorders in international markets, particularly in the Asia Pacificand Middle East regions.
Consolidated list of Major Projects under execution duringthe year:
Name of the Project Value of Project(INR Mn)
ROADS
Silchar-Balchera NH-54 Road Project, 1158Assam (AS-1)
Guwahati-Nalbari NH-31 Road Project, 1736Assam (AS-4)
Guwahati-Nalbari NH-31 Road Project, 1929Assam (AS-5)
Nalbari-Bijni NH-31 Road Project, 1871Assam (AS-8)
Nalbari-Bijni NH-31 Road Project, 1312Assam (AS-9)
Lanka-Daboka NH-54 Project, 1987Assam (AS-16)
Kota-Chittorgarh NH-76 Road Project, 3974Assam (RJ-8)
Lalsot-Kota Project, Rajasthan (LJ-1) 3028
Baran-Jhalawar Project, Rajasthan (LJ-2) 950
Hanumangarh-Ratangarh Project, 2711Rajasthan (HK-1)
Ratangarh-Kishangarh Project, 2275Rajasthan (HK-2)
BUILDINGS
Institute of Integrated Medical SciencesHospital Project, 860
RAILWAYS
Delhi Metro Rail Project Phase II-Elevatedviaduct and work on four stations 857
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 29 |
Broadband and Turnkey Telecom Solutions
The Broadband division of the Company provides an array ofservices that include corporate and retail broadband internet,Internet data centre, managing and maintenance of optic fiberbuild out and other value added services. The over 20,000satisfied customers are spread over segments like BPOs, ITES,Telco, SOHOs, SMEs and Households, across the NCR,Bangalore and Mumbai.
The Broadband division has taken multiple initiatives to facethe challenges of a dynamic technological environment. Therobust fiber infrastructure has been further expanded to approx100Km. in Delhi and the NCR with Ghaziabad, Faridabad,Rohini and Greater NOIDA added to the list. The Company hasentered into Bandwidth purchase contracts of 10 years as partof its international capacity and to reduce cost of purchase.
The division has launched Wi – Fi (Wireless Fidelity) broadband,using radio waves, enabling provision of ready to use internetwithout wires at Hot Spots such as hotels, education centers,hospitals etc. On WiMax side the division has been allocatedthe 12 MHz Frequency spectrum in the 3 GHZ Band. WiMaxtechnology is easy to deploy, delivers Non LOS services from abase station to subscribers and is used to fill up the dark areazones. At present deployment of WiMax technology is inprogress in Delhi and Bangalore. The division has orderedMetro Ethernet equipment of 1000 Mb ring giving increasedcapacity and higher uptime due to failover ring architecture.
In a challenging and competitive environment, the division hascarved out a niche for itself and is driving forward with a multipronged strategy by enhancing the Corporate ISP business,boosting retail sales, expansion of Internet data centre services,and developing the auxiliary business stream - Wi- Fi/Wimax,VPN.
Maintenance and Management Services
The Company continues to provide Asset Maintenance andPreservation services to Daewoo Motors India Limited for theirSurajpur plant.
The Company is also providing operation and maintenanceservices to North Karnataka Expressway Limited for its BelgaunMaharastra Road Project.
Sembawang Engineers and Constructors Group ofCompanies
In line with its vision of becoming a leading global EPC companywith an expanded scale of operations, Punj Lloyd Groupacquired Sembawang Engineers and Constructors Pte Ltd (SECGroup), the engineering and construction arm of SembCorpIndustries Ltd of Singapore, along with its subsidiary SimonCarves of UK in 2006.
SEC is a major design-and-build engineering and constructionservice provider with core capabilities encompassing heavycivil engineering, building, and process and plant engineering.Its experience spans across more than 35 countries. It has 2,040employees worldwide, including 500 design professionals. Theacquisition of SEC has substantially enhanced Punj Lloyd’scapabilities to tap into complementary growth sectors likeinfrastructure and petrochemicals and added a large numberof experienced and qualified engineers to the existing talentpool.
SEC has executed various prestigious projects in the civilengineering and buildings space and has earned for itself areputable name. The company is extending its reach into Asiaand the Middle East having bagged large value projects inthese places.
SEC has also contributed significantly to the top-line of PunjLloyd post acquisition.
Segment-wise presence of the SEC Group:
Civil Engineering
The Group’s civil engineering track record ranges from roadsand bridges, heavy and light rail systems, airports, marinestructures, dredging works, sewage and water treatment plants,underground storage facilities, ports, jetties.
Process Engineering
In 2001, the Sembawang Group expanded its business in theprocess and plant engineering industry through the acquisitionof Simon Carves, a UK-based engineering, procurement &construction management firm. Besides enhancing SEC’s valueproposition, the acquisition also expanded the Group’scapabilities in providing comprehensive engineering andconstruction services to its customers in various fields.
Building
Construction of buildings has been the mainstay of the Group’searly years and it is this traditional competence that has placedSEC at the forefront of the international arena. The company’sexpertise includes the construction of commercial, residential,industrial and institutional complexes, as well as golf courses,recreational buildings and resorts.
The company offers its clients the finest in “one-stop” services –from planning and design to construction.
Sembawang Engineers and Constructors Pte Ltd (SEC)
The consolidated revenue of Semb E&C, a Singapore-basedcompany, for the ten month period ended March 31, 2007 wasSD 744 million. The company’s major projects under executionfor FY07 include:
| 30 |
Mass-Rapid Transit Project – C856
This project includes the construction of four main undergroundMRT stations and 7.4 km underground bore tunnel for the MRTCircle Line in Singapore. This project has an excellent safetyrecord and has zero accidents over the last two years with overfive million man hours already spent therein. Upon construction,this line will provide access to many towns not presentlyaccessible by train.
Mass-Rapid Transit Project – C831
This project involves setting up environmental and ventilationsystems for six MRT stations of the Circle Line. The work includesunderground tunnel ventilation, air-conditioning of stations, andcentral monitoring and control system for ACMV (air-conditioning, ventilation, motor fans etc.)
Highway Project – C421
This project involves the construction of an underground 6 kmdual way, two-lane highway over a river and a major six-lanehighway. The engineering challenges required for theconstruction of a highway over a river provide testimony to theconstruction capabilities of SEC.
Power Plant
SEC is providing full EPC service to build two 750MW combinedgas and steam power plants in Vietnam. This projectdemonstrates SEC’s strength in process design andengineering.
Aircraft Hangar
This is a design-and-build contract for an aircraft hangar andworkshop capable of housing B777-300 and B747-400.
Underground Sewage Project
SEC is working on one of the largest underground sewagesystems in Asia. The company won four major contracts to buildthe main sewage processing plants as well as two undergroundbore tunnels. Upon completion, the project will connect andprocess Singapore’s sewage systems, and allow sewage to berecycled to generate electricity.
Civil and process works for the project include the constructionof the sewage liquid treatment plant, the solids handling system(Sludge dewatering, thickening, mixing, drain and transfersystems) and odor control system.
Consolidated List of Major Projects under execution andawarded to the Sembawang E&C Group during the year:
Name of the Project Value of Project(SD Mn)
CIVIL ENGINEERING
Mass Rapid Transport, Singapore 348
Changi Water/Sewage Plant, Singapore 154
Kallang Expressway, Singapore 32
VNWSSI, Vietnam 4
BUILDING WORKS
RIFFA View, Bahrain 90
Mediterranean Gardens, Dubai 115
7021 LUP bulk Contract, Sinagapore 4
PROCESS ENGINEERING
CaMau Power Plant 2 X 720 and2 X 750 MW, Vietnam 47
PA Plant Zhuhai offshore/onshore 132
CCM UPHA 24
Simon Carves
Simon Carves Ltd, a well known and established processengineering contractor based in England was acquired by PunjLloyd in June 2006 along with its parent company, SembawangEngineers and Constructors Pte Ltd., Singapore.
Simon Carves offers a full range of process design andengineering services to various industries worldwide andprovides end to end solutions including basic and detailedengineering, front end engineering design, procurementservices, and construction services.
Simon Carves engineering staff is a committed team of skilledengineers that remain at the forefront of the latest technicaldevelopments in their field and ensure that the needs of aproject are satisfied.
Order Book
The company started the year with a strong order book andwas able to build on this success by winning several new majorprojects. The year ended with a record order book, which will
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 31 |
form a strong business platform in 2007-08 and on into thefollowing year.
Following a period of pre-engineering and negotiation withthe client, a contract was signed as part of a Pound Sterling159 million project to build a 1.16 Mn litres per day bio-ethanolplant in Teesside, UK. This is the world’s largest wheat basedbio-ethanol plant and would provide growth opportunities andnew markets for Simon Carves.
Outlook
Simon Carves is the world’s No. 1 for low density polyethylene(LDPE) with a wide range of polymer and petrochemical projectexperience. It also has significant experience in chemicals andis focusing on the upcoming areas of bio-fuels and nuclearpower.
The company intends to continue to expand its activities in thepetrochemical sector, which is its historical core area ofexpertise, and also to develop the Bio-fuel sector, where thereis potentially vast market driven by the surge in alternative fueldemand.
Therefore, with the highest backlog of orders in the company’shistory and improved margins, Simon Carves is well placed totake advantage of the synergies of the Punj Lloyd Group toexpand its horizon.
Polymers and Petrochemicals
Simon Carves has designed and supplied more than 60 plantsfor the manufacture of a variety of polymers, of which 35 plantshave been for the manufacture of low density polyethylene(LDPE) or the related product ethylene vinyl acetate (EVA).
Simon Carves is recognized as the world’s leading specialistengineering, procurement and construction contractor for LDPEand continues to dominate this market sector. Additionally, thecompany has a wealth of experience in the polymer industryand has been involved in all types of polymerization processesincluding those associated with the production of linear lowdensity polyethylene (LDPE) and high density polyethylene(HDPE), polypropylene (PP), polyvinyl chloride (PVC),polyester (PET) and acrylics.
Work is well underway on a major Pound Sterling 140 millionLDPE project in Teesside, UK. This design is based on US state-of-the-art technology and when built will be the largest singlestream LDPE in the world, producing 400 kilotonnes of productper year.
Simon Carves has also recently been awarded an EPC contractto build two new 300ktpa LDPE plants – one in Thailand andthe other in Saudi Arabia.
This award underlines Simon Carves’ successful track recordand reputation in engineering, procurement and constructionof process plants worldwide, and these projects significantlywill be amongst the many high pressure polyethylene plant ofthis type executed by Simon Carves, confirming its position as#1 in this field.
Sulphuric Acid
Simon Carves has designed and supplied more than 350sulphuric acid plants worldwide, ranging from small skidmounted units of less than 50 tpd capacity to world scale plantscapable of producing up to 3000 tpd.
Simon Carves’ project capabilities range from plant revampsto lump sum turn key contracts covering all types of plants andutilizing all commercially available feedstocks.
Plant Relocation
Plant relocation offers a new solution to the old problems.Markets move, costs rise, feed stocks run out. By relocatingexpensive production facilities the investment can be given anew lease of life.
Whether a company is looking to find a plant for relocation, ormove a plant it already owns, Simon Carves has theengineering and management expertise to make the movepossible as evident by its success in executing many relocationprojects, which include EVA Co-Polymer Plant, Holland toIndia, Acrylic Fibre Plant, UK to Hungary, Adhesive ResinsPlant, UK to Ireland, Sulphuric Acid Plant, within Australia
Nuclear
For over 30 years, Simon Carves has offered a full range ofcontracting services to the nuclear industry from detailedengineering design to lump sum turnkey projects.
As the nuclear industry modernizes and upgrades its capitalresources, Simon Carves’ engineering capabilities, togetherwith a thorough understanding of nuclear safety and techniquesenable it to satisfy the special process requirements for nuclearfuel cycle facilities, waste management and plantdecommissioning.
Pharmaceuticals and Biotech
Simon Carves is also a leading provider of EPC services acrossthe life sciences sector. The company is recognized foroutstanding levels of customer service, innovation andextensive use of advanced methodologies in designing,planning, building and upgrading Pharmaceutical, Biologicsand Fine Chemical plants around the world.
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GEOGRAPHIES
The Punj Lloyd Group today wields its expertise in many regionsaround the world – South Asia, Asia Pacific, Middle-East,Caspian, Africa, China, and the UK.
Geographical break-up of revenue
FY2007 Share in(INR Mn) revenue (%)
Asia Pacific 18,020 34.62
Caspian 953 1.83
Middle East 8,633 16.58
South Asia 20,173 38.75
Others 4,281 8.22
Middle-East
High oil prices are fuelling the Middle East region’s constructionactivities both in the hydrocarbon and infrastructure sectors.Punj Lloyd received large-size orders particularly from the Oiland Gas sector.
Some of the major projects currently under implementation arein UAE, Qatar, Oman and Yemen. They include such diverseprojects as integral work for a process facility, the extension ofan airport, and a pipeline laying project valued in excess ofUSD 180 million.
With two-third of the world’s proven oil reserves and one-thirdof proven gas reserves lying in the Middle East, this regionoffers significant potential to Punj Lloyd.
Asia-Pacific
Punj Lloyd focused on niche areas in this region such as largeprojects requiring enormous financial resources as well as highend EPC solutions. The company received repeat orders fromits customers in Singapore to build bulk liquid storage terminalsunderlying their confidence and trust in Punj Lloyd.
Going forward, this region is likely to see bigger opportunitiesas Punj Lloyd has initiated a new business area of platformconstruction and installation in Indonesia.
The outlook for the region is favorable as the Company seesnew opportunities for pipelines, offshore platforms and tankterminals arising out of Malaysia and Vietnam.
Caspian
The Caspian area has one of the largest reserves of oil and gasoutside the Middle East. Punj Lloyd has a significant presencein this region with operations in the oil and gas sector. TheCompany is active in Kazakhstan having received a large order
from the operator of the Kashagan Oil Field in WesternKazakhstan.
The outlook for the region is quite encouraging. Punj Lloyd isnow qualified with major operators in Kazakhstan and has beeninvited to bid for large-sized projects in the range of USD 100Million to 500 Million. The Company is further exploringpossibilities of taking up new projects in Kazakhstan andTurkmenistan.
Africa
Punj Lloyd received not only its first but also its largest order todate from this region in 2006-07. The Company won an EPCorder worth USD 290 million from Sirte Oil Company in Libyafor a pipeline project. Punj Lloyd intends to utilize its strengthsand capabilities to further strengthen its reach in Africa.
FINANCIAL REVIEW
Consolidated
Total Revenue of the Company rose by 203.27 percent fromRs. 17,165.88 million in financial year (FY) 2005-06 toRs. 52,059.48 million in FY 2006-07. The profit before interest,depreciation and tax (PBIDT), increased by 120.07 percent fromRs. 2,061.59 million in FY 2005-06 to Rs. 4,536.85 million in FY2006-07.
During the year, the unsecured loans of the Company haveincreased from Rs. 643.88 million to Rs. 5,760.23 million. Thesecured loans have increased during the year fromRs. 4,290.91 million to Rs. 11,231.86 million. Interest chargeshave increased from Rs. 626.70 million to Rs. 825.42 million.
The Profit before tax (PBT) has increased by 218.89 percentfrom Rs. 830.99 million in FY 2005-06 to Rs. 2,649.92 million inFY 2006-07 and the Profit for the year has increased by 255.07percent from Rs. 554.62 million in FY 2005-06 to Rs. 1,969.27million in FY 2006-07.
Standaloane
Total Revenue of the Company rose by 64.32 percent fromRs. 14,030.36 million in financial year (FY) 2005-06 to Rs. 23,054.78million in FY 2006-07. The profit before interest, depreciation andtax (PBIDT), increased by 54.69 percent from Rs. 1,622.81million in FY 2005-06 to Rs. 2,510.36 million in FY 2006-07.
During the year, the unsecured loans of the Company haveincreased from Rs. 629.36 million to Rs. 5,754.98 millionprimarily due to issuance of USD 125 million, Zero CouponForeign Currency Convertible Bonds (FCCB) in April 2006.Likewise, secured loans have increased during the year fromRs. 3,475.30 million to Rs. 9,431.42 million on account ofadditional working capital required to execute various new
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 33 |
projects that have been undertaken by the Company. Interestcharges have also increased from Rs. 467.99 million toRs. 692.42 million on account of increased borrowings andhigher interest rates owing to revision in PLR.
The Profit before tax (PBT) has increased by 72.91 percentfrom Rs. 562.92 million in FY 2005-06 to Rs. 973.33 million inFY 2006-07 and the Profit after tax (PAT) has increased by75.22 percent from Rs. 351.47 million in FY 2005-06 to Rs.615.84 million in FY 2006-07
Adequacy of Internal Control System
The Company has an internal control system commensurate toits size and nature of operations. The internal control systemensures:
1. Timely and accurate recording of financial transactionsand adherence to applicable accounting standards.
2. Optimum utilization and safety of assets.
3. Compliance with applicable laws, regulations, listingagreements and management policies.
4. An effective management information system and reviewsof other systems.
There are well defined and documented procedures, policiesand authority guidelines across all business units. The Companyhas an Oracle based ERP system to ensure robust internalcontrols in financial reporting. The Company uses Maximo, anIT based software to ensure optimum utilization of its assets.The Company is in the process of implementing an IT basedStatutory Compliance tracking tool. Project reviews as part ofinternal control process are carried out on regular basis.
The Internal Audit division conducts audits across the Companythroughout the year to test check the internal control systemand reports its observations to the Audit committee. There is aannual plan for auditing the Corporate & Regional Offices andvarious Project sites. The annual plan is approved by the AuditCommittee and the observations of the internal auditor areplaced before the Audit Committee at regular intervals. Directreporting of the Audit division to the Audit Committee of the
Board ensures Independence of this division.
Risk Management
The Engineering and Construction business by its nature isexposed to risks at various stages. The estimation, bidding,execution and final handover to client pose varying degrees ofrisk. The Company has initiated a systematic approach toidentify, analyse, manage and mitigate these risks. The ITinfrastructure to support this approach is under implemention.The Company is also implementing a control self-assessmenttool to assist in evaluating the effectiveness of Internal controlframework for financial reporting established by the Company.
Human Resource
The success of the company is in attracting, retaining anddeploying good quality Human Resources. The Company hasdrawn up a plan to fulfill all the manpower requirements in theshortest possible time and staff all its various projects beingexecuted all over the world.
Punj Lloyd provides a career for a large number of freshengineering graduates and Diploma holders who are hired onan annual basis. Opportunities are provided to them at variousprojects all over to enhance their skills. These engineeringgraduates / diploma holders are groomed to be multi skilledworkforce. The current manpower strength of PLL group is over6000 as on March 31, 2007.
To enhance the skill levels of employees and further increaseproductivity of employees, the Company has been focusingextensively on technical and behavioral training. One of thesetraining programs includes Leadership Program which helpsto develop future leaders. These trainings are being conductedby various internal and external agencies.
Another important challenge facing the organization is retentionof employees. The Company has taken various steps likeconducting employee satisfaction survey, benchmarking thePLL salaries with the top quartile of the market, enhanced focuson training and development, binding employees throughESOP.
Certain statements in this report may be forward-looking statements. Such forward-looking statements are subject to certain risksand uncertainties like regulatory changes, local, political or economic developments, technological risks, and many other factorsthat could cause our actual results to differ materially from those contemplated by the relevant forward-looking statements. PunjLloyd Limited will not be in any way responsible for any action taken based on such statements and undertakes no obligation topublicly update these forward-looking statements to reflect subsequent events or circumstances.
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Directors’ ReportYour Directors are pleased to present the Nineteenth Annual Report for the year ended March 31, 2007.
FINANCIAL RESULTS
Rs. million
Particulars 2006-07 2005-06
Total Revenue 23,054.78 14,030.36
Profit Before Interest, Depreciation & Tax (PBIDT) 2510.36 1622.81
Less: Interest 692.42 467.99
Gross Profit 1817.94 1154.82
Less: Depreciation 844.61 591.90
Profit Before Tax (PBT) 973.33 562.92
Less: Provision for Taxation including Deferred Tax Charge 357.49 211.45
Profit After Taxation (PAT) 615.84 351.47
Add: Profit Brought Forward 1894.74 1618.19
Transfer from Debenture Redemption Reserve - 12.12
Transfer from Foreign Project Utilised Reserve 22.50 12.50
Surplus Available for appropriation 2533.08 1994.28
Appropriation
Particulars 2006-07 2005-06
Dividend on Equity Shares 78.38 52.22
Corporate Tax on Dividend 13.32 7.32
Amount transferred to General Reserve 75.00 40.00
Profit carried to Balance Sheet 2366.38 1894.74
TOTAL 2533.08 1994.28
CAPITAL STRUCTURE:
During the year under review, the share capital of your Companywas changed /altered as follows:
a) The authorised share capital of your Company has beenre-organised by canceling 1,00,00,000 preference sharesof Rs. 10/- each and increasing the equity share capitalby the same denomination i.e. 1,00,00,000 equity sharesof Rs. 10/- each
b) Each equity share of Rs. 10/- in the existing authorisedshare capital of the Company has been subdivided into 5equity shares of Rs. 2/- each. Accordingly the AuthorisedShare Capital of the Company is as follows:
“35,00,00,000 (Thirty Five crores) Equity Shares ofRs. 2/- (Rupees Two) each and 1,00,00,000 (One crore)
Preference Shares of Rs. 10/- (Rupees Ten) eachaggregating to Rs. 80,00,00,000/- (Rupees Eighty croresonly).”
c) During the year, 32,231 shares of Rs. 10/- each wereallotted to employees under Employee Stock Options Plan,2005 of the Company.
EQUITY DIVIDEND
Your Directors recommend a dividend of 15% on equity shares,i.e. Re. 0.30 per share.
OPERATIONS REVIEW
Total Revenue of your Company rose by 64.32 percent fromRs. 14,030.36 million in financial year (FY) 2005-06 to Rs. 23,054.78million in FY 2006-07. The profit before interest, depreciation and
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 35 |
tax (PBIDT), increased by 54.69 percent from Rs. 1622.81million in FY 2005-06 to Rs. 2,510.36 million in FY 2006-07.
During the year, the unsecured loans of your Company haveincreased from Rs. 629.36 million to Rs. 5,754.98 millionprimarily due to issuance of USD 125 million, Zero CouponForeign Currency Convertible Bonds (FCCB) in April 2006. Thesecured loans have also increased during the year fromRs. 3,475.30 million to Rs. 9,431.42 million due to the additionalworking capital required for execution of various new projectsbeing undertaken by the Company. Interest charges have alsoincreased from Rs. 467.99 million to Rs. 692.42 million as resultof increased borrowings and higher interest rates owing torevision in PLR.
The Profit before tax (PBT) has increased by 72.91 percentfrom Rs. 562.92 million in FY 2005-06 to Rs. 973.33 million inFY 2006-07 and the Profit after tax (PAT) has increased by75.22 percent from Rs. 351.47 million in FY 2005-06 to Rs.615.84 million in FY 2006-07
BUSINESS REVIEW
A detailed business review is being given in the ManagementDiscussion and Analysis section of the annual report.
SUBSIDIARY COMPANIES AND JOINT VENTURES
Subsidiaries
During the year under review, your Company has through itswholly owned subsidiary in Singapore viz Punj Lloyd Pte. Ltd.,acquired 100% stake in SembCorp Engineers & Constructors(SEC), a wholly-owned subsidiary of SembCorp Industries (SCI)which is a leading utilities and marine group in Asia. The SECGroup is a major design-and-build engineering andconstruction service provider with core capabilitiesencompassing heavy civil engineering, building and processand plant engineering and its experience spans across 35countries. The SEC Group has contributed significantly to thetop line of consolidated results of your Company as its revenuesfor the ten months period ended March 31, 2007 was SingaporeDollars 744 million (approx. Rs. 21520 million). This acquisitionwill help your Company in achieving its objective of becominga top global EPC Company with an increasing scale ofoperations.
Simon Carves Ltd., U.K., a subsidiary of SEC is a well knownand established process engineering contractor and offers fullrange of process design and engineering services to variousindustries worldwide and provides end to end solutions includingbasic and detailed engineering, front end engineering design,procurement services, construction and constructionmanagement services. Simon Carves has a strong order book,which will form a strong business platform for 2007-08 and oninto following year.
For the purpose of integrating the engineering expertise of theCompany with that of its two recent acquisitions viz. SembawangEngineers & Constructors and Simon Carves, UK, a newCompany – Simon Carves India Limited has been incorporatedin India as a Wholly Owned Subsidiary of the Company for carryingout back office engineering activities for the Punj Lloyd Group inIndia. In addition to the above, Simon Carves India Limited shallprovide design and engineering services to all types of industries/sectors including oil & gas, infrastructure, etc.
After the closure of current financial year, two new wholly ownedsubsidiaries i.e. Punj Lloyd Upstream Limited and Punj LloydInfrastructure Limited have been incorporated to carry on thebusiness of drilling in the fields of oil exploration and promotingand developing SEZs respectively.
The process of winding up of Punj Lloyd Inc., a wholly ownedsubsidiary (WOS) in US and Punj Lloyd (Malaysia) Sdn. Bhd.,WOS in Malaysia are in progress and will be completed onreceipt of necessary clearance from the appropriate authoritiesof the respective countries.
On an application by the Company under section 212(8), theCentral Government has vide its letter No. 47/78/2007-CL-IIIdated March 6, 2007 exempted the Company from attaching acopy of Balance Sheet, Profit and Loss Account, and otherdocuments in respect of its subsidiaries for the year endedMarch 31, 2007.
A statement in respect of each of the subsidiaries, giving thedetails of capital, reserves, total assets and liabilities, details ofinvestment, turnover, profit before taxation, provision fortaxation, profit after taxation and proposed dividend is attachedto this report.
Annual accounts of the subsidiary companies and the relateddetailed information will be made available to the holding andsubsidiary company investors, seeking such information. Copiesof the annual accounts of the subsidiary companies areavailable for inspection by any investor at the Registered Officeof the Company between 11.00 AM to 13.00 PM on all workingdays.
Joint Ventures
During the year under review, the Company has entered into ajoint venture with Swissport International, one of the worldleaders in ground handling services. In terms of the Joint VentureAgreement with Swissport, a new company in the name of‘Swissport Punj Lloyd India Pvt. Ltd.’ has been incorporatedwith equity participation in the ratio of 51:49 by Swissport andthe Company respectively. Leveraging on Swissport’s brandand know-how and Punj Lloyd’s local expertise, both partnerswill take advantage of this joint venture to develop projects inthe Indian ground handling sector.
The Company has also entered into a joint venture withKAEFER GmbH, Germany, a world leader in the insulationbusiness. In terms of the above joint venture, KAEFER GmbHhas acquired 51% stake in Punj Lloyd Insulations Limited, aWholly Owned Subsidiary of the Company. Consequent to theabove acquisition, the name of ‘Punj Lloyd Insulations Limited’has been changed to ‘KAEFER Punj Lloyd Limited’. This jointventure will open avenues for developing innovative insulationsolutions for various applications.
HEALTH, SAFETY AND ENVIRONMENT (HSE)As a rapidly growing engineering and construction contractorwith presence in different global locations with diverse culturesand operations in remote locations, Punj Lloyd strives tominimize accidents and occupational risks through systematicassessment and control of hazards by providing training toemployees and subcontractors. HSE considerations are put atthe forefront of everything our employees do – whetherdesigning an oil storage tank farm or constructing that facility.
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To protect health of our employees and of subcontractors’employees in our activities, for last several years we havedeployed an Occupational Health & Safety policy based onidentifying and managing risks. We strongly encourage theadoption of Occupational Health, Safety and EnvironmentalManagement System as an integral part of our operations. Riskassessment methodology and criteria has been distributed toall our sites. Identified high and medium risks are managedthrough action plans covering prevention, protection, employeeinformation and education initiatives. Punj Lloyd believes inholding regular HSE programs to develop and enhancecompetency of employees.Punj Lloyd recognizes that with leadership comes greatresponsibility and that future generations are relying on us toprotect and preserve the natural environment. We promoteenvironmental management by managing our operations in aresponsible way. Our key environmental monitoring parametersare energy efficiency, spill prevention and waste management.Reaffirming our commitment to fighting HIV/AIDS, world aidsday is celebrated organization wide. We have selected MedicitySite at Gurgaon, Haryana in association with SNS Foundationto focus on four main areas viz. Information and awareness,prevention, promotion of voluntary confidential testing and freetreatment.As a key management control process, periodically we areaudited internally and by internationally renowned third partyDet Norske Veritas (DNV) in accordance with internationallyrecognized protocols of Occupational Health & SafetyManagement System (OHSAS 18001) and EnvironmentManagement System (ISO 14001).
Pursue goal of no harm to employees and Sub contractors,Reduce risk as low as reasonably possible, Minimize pollutionin construction activities by efficient use of non-renewableresources and optimizing fuel consumption, Reduce wastegeneration and reusing the materials wherever possible areour main HSE objectives.
DIRECTORS
During the year, Mr. Keith N. Henry, Mr. Karamjit Singh Butaliaand Mr. Alain Aboudaram resigned from the Board. YourDirectors place on record their deep sense of gratitude andappreciation for the valuable services rendered by them duringtheir tenure as Directors of the Company.
Mr. Sanjay Bhatnagar, Mr. P.K. Gupta and Mr. Scott R. Baymanwere appointed as Additional Directors and their terms of officeare expiring at the ensuing Annual General Meeting. Necessaryresolutions for their appointment as directors liable to retire byrotation is being included in notice convening Annual GeneralMeeting pursuant to notices received under Section 257 of theCompanies Act, 1956. Subject to the approvals of shareholdersand Central Government, Mr. P.K. Gupta was also appointedas Whole Time Director of the Company for a period of fiveyears effective June 1, 2007, liable to retire by rotation.
Mr. Rajan Jetley is retiring by rotation at the ensuing AnnualGeneral Meeting and being eligible has offered himself for re-appointment.
Brief resumes of the Directors being appointed/ re-appointed,as required by Clause 49 of the Listing Agreement, are furnished
in the explanatory statement to the notice convening ensuingAnnual General Meeting.
DIRECTORS’ RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 217(2AA) of theCompanies Act, 1956, it is hereby confirmed:
� that in the preparation of the annual accounts, the applicableaccounting standards have been followed along with properexplanation relating to material departures;
� that the Directors have selected such accounting policiesand applied them consistently and made judgments andestimates that were reasonable and prudent so as to givea true and fair view of the state of affairs of the Company atthe end of the financial year and of the profit or loss of theCompany for the period under review;
� that the Directors have taken proper and sufficient care forthe maintenance of adequate accounting records inaccordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detectingfraud and other irregularities;
� that the Directors have prepared the annual accounts forthe year ended March 31, 2007 on a ‘going concern’ basis.
UTILISATION OF IPO PROCEEDS
The funds raised through Initial Public Offer aggregating toRs. 5848.62 million have been fully utilised. The details of thefund utilisation are as under:
Rs. in million
Particulars Projected Utilization Actualas per prospectus Utilisation
Investment in CapitalEquipment Upto 1500.00 1485.27
Prepayment of Debt Upto 3000.00 3064.17
Equity Investment inInfrastructure Projects,WOS, JVs Upto 500.00 453.30
General CorporatePurpose 522.921 540.78
Offer Related Expenses 325.700 305.10
Total 5848.62 5848.62
LISTING OF THE SHARES
Your Company’s shares are listed at Bombay Stock ExchangeLtd. and the National Stock Exchange of India Ltd. and thelisting fee for the year 2007-08 has been paid to these stockexchanges.
ESOPs
The details as required to be provided in terms of the Securitiesand Exchange Board of India (Employee Stock Option Schemeand Employee Stock Purchase Scheme) Guidelines, 1999 asregards the Punj Lloyd Employee Stock Option Plan, 2005 and2006 as on March 31, 2007 are given below:-
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 37 |
Sl. Particulars ESOP 2005 ESOP 2006No.
Date of Grant Nov. 17, 2005 May 10, 2006 Oct. 30, 2006
1. Total No. of options granted 643,489 154,208 298,210
2. Pricing Formula Exercise price being Rs. 1,179.95 Rs. 772.30at 10% discount to IPO (being the market (being the marketprice i.e. Rs. 630/- per price as defined in price as defined inshare of Rs. 10 each. SEBI guidelines) SEBI guidelines)
3. Number of options vested 64,354 Nil Nil
4. Number of options exercised 32,231 Nil Nil
5. Total no. of shares arising as a result of 32,231 ofexercise of options Rs. 10/- each Nil Nil
6. Number of options lapsed 146,241 61,582 16,600
7. Number of options forfeited Nil Nil Nil
8. Variation in terms of options None None None
9. Money realized by exercise of options 20,305,530 None None
10. Total No. of options in force as on 497,248 92,626 281,61031st March, 2007
11. Grant to Senior Management- Number of options 370,109 70,587 200,560- Vesting period 4 Yrs. 4 Yrs. 4Yrs.
12. Any other employee who receives a grant in Mr. V K Kaushik Nil Mr. V K Kaushikany one year of options amounting to 5% or Options Granted Options Grantedmore of option granted during the year – 40,000 – 15,000
13. Identified employees who were granted option, Nil Nil Nilduring any one year equal to or exceeding 1%of the issued capital (excluding outstandingwarrants and conversions) of the Company atthe time of grant.
An aggregate of 32,231 shares were issued pursuant to exerciseof options under Punj Lloyd Employee Stock Option Plan, 2005,resulting in dilution of EPS by 0.00042.
Pursuant to the subdivision of each equity share of Rs. 10/-each in the Authorised Share Capital of the Company into 5equity shares of Rs. 2/- each, the number of options grantedand resultant equity shares shall stand increased by five times.
CORPORATE GOVERNANCE
Report on Corporate Governance as stipulated under Clause49 of the Listing Agreements with the Stock Exchanges formspart of this Annual Report. Certificate of the auditors of theCompany regarding compliance of the conditions of corporategovernance as stipulated in Clause 49 of the Listing Agreementwith the stock exchanges is attached to the report as Annexure 1.
MANAGEMENT DISCUSSION AND ANALYSIS
A detailed section of the Management Discussion and Analysisforms part of the Annual Report.
CONSOLIDATED FINANCIAL STATEMENT
In accordance with the accounting standard (AS-21) onconsolidated financial statements, your Directors are pleasedto attach the consolidated financial statements, which form partof the Annual Report and Accounts.
ACCOUNT AND AUDIT
The Auditors, M/s S. R. Batliboi & Co. retire at the conclusion ofthe Nineteenth Annual General Meeting and being eligible,have offered themselves for re-appointment vide their letterdated May 14, 2007. The qualifications/observations of theAuditors are explained wherever necessary in appropriate notesto Accounts.
INTERNAL CONTROL SYSTEM
The Company has an internal control system commensurate toits size and nature of operations. The internal control systemensures:
1. Timely and accurate recording of financial transactions andadherence to applicable accounting standards.
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2. Optimum utilization and Safety of Assets.
3. Compliance with applicable laws, regulations, listingagreements and Management policies.
4. An effective management information system and reviewsof other systems.
There are well defined and documented procedures, policiesand authority guidelines for each business unit. The Companyhas an Oracle based ERP system across all business units toensure robust internal controls in financial reporting. TheCompany uses Maximo, an IT based software, to ensureoptimum utilization of its assets. The Company is in the processof implementing an IT based Statutory Compliance trackingtool. Project reviews as a part of internal control process iscarried out by Internal Audit.
The Internal Audit Division conducts audits across the Companythroughout the year to test check the internal control systemand reports observations to the Audit committee. There is aAnnual Plan for auditing the Corporate & Regional Offices andvarious Project sites. The Annual Plan is approved by the AuditCommittee and the observations of the Internal Audit Divisionare placed before the Audit Committee at regular intervals. Directreporting of this division to the Audit Committee of the Boardensures independence of this division.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from public,shareholders or employees during the year.
PERSONNEL
As required by the provisions of Section 217(2A) of theCompanies Act, 1956 read with Companies (Particulars ofEmployees), Rules, 1975, as amended, the names and otherparticulars of employees are set out in the Annexure 2 to theDirectors’ Report. However, as per the provisions of Section219 (1) (b) (iv) of the Companies Act, 1956, the Directors’ Report
is being sent to all members of the Company excluding theaforesaid information. Any member interested in obtaining suchparticulars may write to the Company Secretary at theRegistered Office of the Company.
CONSUMPTION OF ENERGY AND FOREIGN EXCHANGEAND OUTGO
The details as required under the Companies (Disclosure ofParticulars in Report of Board of Directors) Rules, 1988 aregiven as Annexure 3 to the Directors’ report. However, as perthe provisions of Section 219 (1) (b) (iv) of the Companies Act,1956, the Directors’ Report is being sent to all members of theCompany excluding the aforesaid information. Any memberinterested in obtaining such particulars may write to the CompanySecretary at the Registered Office of the Company.
ACKNOWLEDGEMENT
Your Directors wish to place on record their sincere thanks toemployees at all levels for their dedication and persistent hardwork towards making the Company a Global EngineeringSuccess. Your Director would also like to express theirappreciation to the customers, partners, business associates,financial institutions, banks and various agencies of Central &State Government for their support. Your Directors would alsolike to thank all the shareholders for their continued confidencein the Company
For and Behalf of the Board
Sd/-Atul PunjChairman
Place : GurgaonDate : May 31, 2007
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Corporate GovernancePHILOSOPHY OF THE COMPANY ON CORPORATEGOVERNANCE
Punj Lloyd Ltd. (PLL) is committed to adoption of best governancepractices, their adherence in true spirit and conduct its affairs ina manner, which is transparent, clear and evident to those havingdealings with or having a stake in the Company. PLL lays strongemphasis on business ethics in all its dealings. In line with PLL’svision and long-term business objectives, all major corporatedecisions are taken by the Company’s professional Board inconjunction with a competent management team, keeping inview the best interest of all its stakeholders.
BOARD OF DIRECTORS
COMPOSITION OF THE BOARD
As on March 31, 2007, PLL’s Board consisted of eight Directors.Table 1 gives the details of the Board as on March 31, 2007.
Table 1 : Composition of the Board of Directors of PLL
Sl. Name of Director Category No. of No. of Board LevelNo. of Director other Committees where
Directorships* chairperson ormember
Chairperson Member1. Mr. Atul Punj Executive, 7 1 2
Promoter
2. Mr. Vimal Kishore Kaushik Executive 7 1 1
3. Mr. Luv Chhabra Executive 4 – 1
4. Mr. Karamjit Singh Butalia $ Non Executive, 1 – 2Non Independent
5. Mr. Alain Aboudaram $ Independent – – –
6. Dr. Naresh Trehan Independent 7 2 1
7. Mr. Rajan Jetley Independent 1 – 2
8. Mr. Sanjay Bhatnagar @ Independent – – 1
* Directorship in foreign companies and the Indian Pvt. Ltd. companies is not included.
@ Appointed as an additional Director w.e.f. October 19, 2006.
$ Resigned as director w.e.f. May 31, 2007. Mr. Scott R. Bayman and Mr. P. K. Gupta have beenappointed as additional directors of the Company w.e.f. June 1, 2007.
During the year, Mr. Keith Nicholas Henry resigned as Directorof the Company.
The Company does not have any pecuniary relationship withany non executive or independent Director except for paymentof sitting fee of Rs. 10,000 per meeting and reimbursement oftravelling expenses to the Directors for attending the Boardmeetings. No sitting fee is paid for attending the meetings ofCommittes of Directors.
NUMBER OF BOARD MEETINGS
During 2006-07, the Board of Directors met four times on June27, 2006, July 31, 2006, October 30, 2006 and January 29, 2007.The gap between any two Board meetings was not more thanfour months. Table 2 gives the details.
Table 2 : Board Meeting Attendance Record of the Directorsin 2006-07
Name of Director Board Meetings Whethermeetings attended attended
held last AGMduring the
tenure
Mr. Atul Punj 4 4 Yes
Mr. Vimal Kishore Kaushik 4 4 Yes
Mr. Luv Chhabra 4 4 Yes
Mr. Karamjit Singh Butalia $ 4 4 No
Mr. Alain Aboudaram $ 4 4 No
Mr. Keith Nicholas Henry # 2 2 No
Dr. Naresh Trehan 4 4 Yes
Mr. Rajan Jetley 4 2 No
Mr. Sanjay Bhatnagar * 2 2 NA
# Resigned from the Board of Directors w.e.f. October 19, 2006.
* Appointed as an additional Director w.e.f. October 19, 2006.
$ Resigned as directors w.e.f. May 31, 2007. Mr. Scott R. Bayman and Mr. P. K. Gupta have been
appointed as additional directors of the Company w.e.f. June 1, 2007.
REMUNERATION OF DIRECTORS
Table 3 : Remuneration Paid or Payable to Directorsduring 2006-07
Amout in Rs.
Name of Director Salary Sitting Perquisites Deferred Performance Totalfees Benefits Incentives
(PF and (Provided)Supera-
nnuation)
Mr. Atul Punj – – – – 10,000,000 10,000,000
Mr. Vimal KishoreKaushik 2,160,000 – 3,480,344 363,096 2,000,000 8,003,440
Mr. Luv Chhabra 2,100,000 – 3,231,247 353,010 2,000,000 7,684,257
Mr. Karamjit SinghButalia @ – 40,000$ – – – 40,000
Mr. Alain Aboudaram @ – 40,000 – – – 40,000
Mr. Keith Nicholas
Henry # – 20,000 – – – 20,000
Dr. Naresh Trehan – 40,000 – – – 40,000
Mr. Rajan Jetley – 20,000 – – – 20,000
Mr. Sanjay Bhatnagar * – 20,000 – – – 20,000
# Resigned from the Board of Directors w.e.f. October 19, 2006.* Appointed as an additional Director w.e.f. October 19, 2006.$ Mr. Butalia is nominee director of Merlion India Fund III Limited and the
payments of sitting fee are being made to Standard Chartered Private Equity(Mauritius) II Ltd., the representatives of Merlion India Fund III Limited.
@ Resigned as Director w.e.f. May 31, 2007.
ANNEXURE 1
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STOCK OPTIONS TO DIRECTORS
A. ESOP 2005
Name Total no. Options Options Exercise Optionsof options* vested Exercised Price still
till (Rs.) unvestedMarch
31, 2007
Mr. Vimal Kishore Kaushik 200,000 20,000 20,000 126/- 180,000
Mr. Luv Chhabra 135,000 13,500 13,500 126/- 121,500
B. ESOP 2006Total no. Options Options Exercise Options
of options* vested Exercised Price stilltill (Rs.) unvested
March31, 2007
Mr. Vimal Kishore Kaushik 75,000 Nil Nil 154.46 75,000
Mr. Luv Chhabra 60,000 Nil Nil 154.46 60,000
* Each option gives a right to the holder to exercise one equity share of the Company. The shareholdersin their meeting held on March 6, 2007 approved the sub-division of equity shares of the Companyfrom one equity share of Rs. 10/- to five equity shares of Rs. 2/- each. The Stock Options grantedto directors have been accordingly increased.
SHAREHOLDING OF NON EXECUTIVE DIRECTORS OF THECOMPANY
Name of Director No. of shares held (facevalue Rs. 2/- per share)
Mr. Karamjit Singh Butalia * –
Mr. Alain Aboudaram * –
Dr. Naresh Trehan 4,000
Mr. Rajan Jetley 480
Mr. Sanjay Bhatnagar –
* Resigned as directors w.e.f. May 31, 2007.
INFORMATION SUPPLIED TO THE BOARD
Clause 49 of the Listing Agreement mandates that the followinginformation must be supplied to the Board of Directors:
� Annual operating plans & budgets and any update thereof.
� Capital budgets and any updates thereof.
� Quarterly results for the Company and operating divisionsand business segments.
� Minutes of the meetings of the audit committee and othercommittees of the Board.
� Information on recruitment and remuneration of seniorofficers just below the level of Board, including theappointment or removal of Chief Financial Officer &Company Secretary.
� Materially important showcause, demand, prosecutionnotices and penalty notices.
� Fatal or serious accidents, dangerous occurrences, anymaterial effluent or pollution problems.
� Any material default in financial obligations to and by theCompany, or substantial non-payment for goods sold bythe company.
� Any issue, which involves possible public or product liabilityclaims of substantial nature, including any judgement ororder which, may have passed strictures on the conduct ofthe Company or taken an adverse view regarding anotherenterprise that can have negative implications on theCompany.
� Details of any joint venture or collaboration agreement.
� Transactions that involve substantial payment towardsgoodwill, brand equity or intellectual property.
� Significant labour problems and their proposed solutions.Any significant development in human resources/industrialrelations front like signing of wage agreement,implementation of voluntary retirement scheme, etc.
� Sale of material nature of investments, subsidiaries, assets,which is not in the normal course of business.
� Quarterly details of foreign exchange exposures and thesteps taken by management to limit the risks of adverseexchange rate movement, if material.
� Non-compliance of any regulatory, statutory nature or listingrequirements and shareholders service such as non-payment of dividend, delay in share transfer, etc.
The Board of PLL is routinely presented with all such informationapplicable and materially significant. These are submitted eitheras a part of the agenda papers well in advance of the Boardmeetings or tabled in the course of the Board meeting.
COMMITTEES OF THE BOARD
a) AUDIT COMMITTEE
As on March 31, 2007, the Audit Committee of the Companycomprised of three independent Directors and one nonexecutive and non independent Director. The constitutionof the Committee meets the requirements of Section 292Aof the Companies Act, 1956, as well as Clause 49 of theListing Agreement. The members are:
� Dr. Naresh Trehan, Chairman (Independent Director)
� Mr. Karamjit Singh Butalia * (Non Executive and NonIndependent Director)
� Mr. Rajan Jetley (Independent Director)
� Mr. Sanjay Bhatnagar (Independent Director)
* Ceased to be member of the Audit Committee w.e.f. May 31, 2007.
The terms of reference of PLL’s Audit Committee are:
� Oversight of the Company’s financial reportingprocess and the disclosure of its financial information
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to ensure that the financial statement is correct,sufficient and credible.
� Recommending the appointment and removal ofstatutory auditor, fixation of audit fee and also approvalfor payment for any other services.
� Reviewing with management the quarterly/ annualfinancial statements before submission to the Board,focusing primarily on the following:
� Matters required to be included in the Director’sResponsibility Statement.
� Any change in accounting policies and practices.
� Major accounting entries based on exercise ofjudgement by management.
� Significant adjustments arising out of audit.
� Compliance with accounting standards.
� Compliance with listing and other legal requirementsrelating to financial statements.
� Qualifications in draft audit report.
� Compliance with legal requirements concerningfinancial statements.
� Any related party transaction, i.e., transaction of theCompany of material nature, with promoters or themanagement, their subsidiaries or relatives, etc., thatmay have potential conflict with the interest ofCompany at large.
� Reviewing with the management, statutory and internalauditors, the adequacy of internal control systems.
� Reviewing the adequacy of internal audit function,including the structure of the internal audit department,staffing and seniority of the official heading thedepartment, reporting structure coverage andfrequency of internal audit.
� Discussion with internal auditors any significantfindings and follow up thereon.
� Reviewing the findings of any internal investigationsby the internal auditors into matters where there issuspected fraud or irregularity or a failure of internalcontrol systems of a material nature and reporting thematter to the Board.
� Discussion with statutory auditors before the auditcommences, nature and scope of audit as well as havepost audit discussion to ascertain any area of concern.
� Reviewing the Company’s financial and riskmanagement policies.
� To look into the reasons for substantial defaults in thepayment to the depositors, debenture holders,shareholders (in case of non-payment of declareddividends) and creditors.
During 2006-07, the Audit Committee of PLL met four times i.e.on June 27, 2006, July 31, 2006, October 30, 2006 and January29, 2007. Table 4 gives the attendance record of Directors whoare members of the Audit Committee.
Table 4 : Attendance Record of Audit Committee Meetingsduring 2006-07
Name of Director Number of Number ofmeetings held meetings
during the tenure attended
Dr. Naresh Trehan 4 4
Mr. Karamjit Singh Butalia $ 4 4
Mr. Rajan Jetley 4 2
Mr. Keith Henry # 2 2
Mr. Sanjay Bhatnagar * 2 2
# Ceased to be member of the Committee w.e.f. October 19, 2006.
* Appointed as member of the Committee w.e.f. October 19, 2006.
$ Ceased to be member of the Committee w.e.f. May 31, 2007.
b) REMUNERATION COMMITTEE
The terms of reference of PLL’s Remuneration Committeeamongst others is to decide the amount of salary, perquisitesand commission to be paid to the Directors (within the overallceiling fixed by the shareholders). As on March 31, 2007,the Committee consisted of two independent and one nonexecutive and non independent Director, as under:
� Dr. Naresh Trehan;
� Mr. Rajan Jetley; and
� Mr. Karamjit Singh Butalia *
* Ceased to be member of the Committee w.e.f. May 31, 2007 and Mr. Sanjay
Bhatnagar has been inducted as member of the Committee w.e.f. May 31, 2007.
During 2006-07, the Remuneration Committee met twice on June27, 2006 and October 30, 2006. Table 5 gives the attendancerecord of Directors who are members of the RemunerationCommittee.
Table 5 : Attendance Record of Remuneration CommitteeMeetings during 2006-07
Name of Director Number of Number ofmeetings meetings
held under attendedtenure
Dr. Naresh Trehan 2 2
Mr. Karamjit Singh Butalia 2 2
Mr. Rajan Jetley 2 1
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Criteria for making payment to Directors of the Company :
The Criteria for making payments to Executive Directors is :
� The Remuneration Committee of the Companyrecommends the salary payable to Executive Directors.
� The shareholders of the Company approved the paymentof performance linked incentives to the Executive Directors.The exact amount of performance linked incentive to eachExecuive Director is decided by the RemunerationCommittee.
� The Remuneration paid to Executive Directors aredetermined keeping in view the industry benchmarks.
During the financial year ended March 31, 2007, no paymentwas made to any Non-executive Director of the Company, exceptsitting fees and reimbursement of travelling expenses forattending the meeting of Board of Directors.
c) SHAREHOLDERS/INVESTORS, GRIEVANCECOMMITTEE
The terms of reference of the Committee are:
� To approve the transfer/transmission of securities ofthe Company and oversee and review all mattersconnected with the transfer/transmission of securitiesof the Company.
� To issue new certificates of securities of the Companyon split up or consolidation and issue of duplicatecertificates of securities of the Company against lost/torn/mutilated certificates etc.
� To issue new certificates of securities in case of changein denomination of securities of the Company.
� To decide on any matter relating to the securities ofthe Company whether in physical or dematerializedform.
� To formulate and implement the Company’s Code ofConduct for prohibition of Insider Trading in pursuanceof SEBI (Prohibition of Insider Trading) Regulations,1992 and review and monitor its compliance.
� To appoint and/or remove Compliance Officer(s) ofthe Company for complying with the Requirements ofthe SEBI (Prohibition of Insider Trading) Regulations,1992 and the Listing Agreement(s) to be entered intowith various Stock Exchange(s).
� To appoint and/or remove the Registrars and TransferAgent(s) of the Company and for that purpose toauthorise any officer(s) of the Company to enter intoTripartite Agreement(s) with the Registrars andTransfer Agent(s) and Depository(s).
� To review the performance of the Registrars andTransfer agents and recommend measures forimprovement in the quality of investor services.
� To look into the redressal of shareholders andinvestors complaints of any nature including but notlimited to the following:
� Transfer of securities
� Non-receipt of Balance Sheet
� Non-receipt of declared dividends
� Change of address of the shareholders
� Non-receipt of shares in physical or demat form
� Shareholders’ complaints of other nature forwardedto the Company by Stock Exchanges/SEBI
� Correction/change of the bank mandate of refundorders
� Other complaints of similar nature received from theshareholders.
� Any other matters to be delegated under anyapplicable law or regulation or rules applicable to theCompany.
� To delegate all or any of the powers mentioned aboveto any officer(s) of the Company and/or to the Registrarand Share Transfer Agents appointed/to be appointedby the Company.
The three-member Committee is headed by Dr. NareshTrehan, an Independent Director and consists of thefollowing members:
� Dr. Naresh Trehan
� Mr. Atul Punj
� Mr. Luv Chhabra
Mr. Dinesh Thairani, Company Secretary, is the ComplianceOfficer.
During 2006-07, the Shareholders/Investors GrievanceCommittee of PLL met four times i.e. on June 27, 2006, July 31,2006, October 30, 2006 and January 29, 2007. Table 6 gives theattendance record of Directors who are members of the
Shareholders/Investors Grievance Committee.
Table 6 : Attendance Record of Shareholders/Investors
Grievance Committee Meetings during 2006-07
Name of Director Number of Number ofmeetings held meetingsunder tenure attended
Dr. Naresh Trehan 4 4
Mr. Atul Punj 4 4
Mr. Luv Chhabra 4 4
As on March 31, 2007, no Investor complaints were pendingwith the Registrar and Share Transfer Agent. Table 7 gives thedata on the shareholder/Investor complaints received andredressed, during the year 2006-07.
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Table 7 : Shareholder and Investor Complaints Received andRedressed, during 2006-07
Total Complaints Total complaints Pending as onreceived redressed 31.03.2007
278 278 Nil
Code of Conduct for Directors and Sr. Management Personnel:
The Board of Directors of the Company has adopted the Code ofConduct for Directors and Sr. Management Personnel. The Codeis applicable to both Executive and Non executive Directors aswell as Sr. Management. A copy of the code is available onCompany’s website www.punjlloyd.com
A declaration signed by Chairman is given below:
I hereby confirm that:
The Company has obtained from all the members of the Boardand Sr. Management, affirmation that they have complied withthe Code of Conduct for Directors and Sr. ManagementPersonnel in respect of the financial year 2006-07.Sd/-
ATUL PUNJChairmanMANAGEMENT
MANAGEMENT DISCUSSION AND ANALYSIS
This is given as a separate chapter in this Annual Report.
DISCLOSURE REQUIREMENTS
� Disclosures on materially significant related partytransactions are given in the Notes to Accounts attached tothe Balance Sheet.
� During last three years, there has been no non-complianceby the Company and no penalties, strictures are imposedon the Company by the Stock Exchanges, or SEBI or anystatutory authority on any matter related to capital markets.
� The Company has complied with all the mandatoryrequirements of Clause 49 of the Listing Agreement and ithas set up a remuneration committee and adopted WhistleBlower Policy under non mandatory requirements.
SHAREHOLDERS
Re-appointment of Directors
Mr. Rajan Jetley
Mr. Rajan Jetley is retiring by rotation at the ensuing AnnualGeneral Meeting. Mr. Rajan Jetley, being eligible has offeredhimself for re-appointment.
Brief resume of Mr. Rajan Jetley is as under:
Mr. Rajan Jetley (57) is a senior Cambridge graduate from BishopSchool (1967), a Bachelor of Arts from St. Aloysius, University ofJabalpur (1970) and an MBA from the Delhi University (1972),obtaining all these degrees in First Class.
He started his career with the British American Tobacco Company(ITC) in India in 1972, and rose to the position of MarketingController of the Hotels Division of the Company – Welcomegroupin 1982.
In 1982, at the age of 32, Mr. Jetley became the Managing Directorof the India Tourism Development Corporation (ITDC). At thetime of appointment, he became the youngest ever ChiefExecutive Officer of a Public Undertaking in India. During his fiveyear tenure as Managing Director of ITDC, the organisationhosted the Non-aligned Heads of State Meet playing host to 105Heads of State in New Delhi, the Commonwealth Heads of theState Meet held in India and the Asian Games, winning laurelsfor the Corporation. Mr. Jetley’s personal contribution to theseevents was recognised by the Government with the President ofIndia awarding him a National recognition, the “Asiad Jyoti”.
In 1987, Mr. Jetley was selected to head Air India the IndianNational Carrier as its youngest ever Managing Director, and atthe age of 37 was the youngest ever Chief Executive Officer ofany National Airline. During his tenure, Air India made aremarkable turnaround from a loss making organisation tobecoming one of the most profitable airlines in the world.
Presently Mr. Jetley is a Promoter and Chairman of Jacob BallasCapital India Private Limited, a Private Equity Advisory Firm injoint venture with New York Life, the world’s second largestinsurance Company which advises and co-invests into theprivate equity market in India.
Mr. Jetley is also the Chairman of Radisson Hotels Asia PrivateLimited, a Singapore based Company in which he holds majorityholding.
In addition, Mr. Jetley is also the Promoter and major shareholderof Bistro Hospitality Private Limited, the master Franchisee of allTGI Friday’s Restaurants in India.
Directorship in other Public Companies and CommitteeMembership
Directorship in other Public CommitteeCompanies Membership
Zee Telefilms Limited Audit Committee
Mr. Rajan Jetley is a member of Audit and RemunerationCommittee of PLL and as on March 31, 2007 holds 480 equityshares of Rs. 2/- each in the Company.
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APPOINTMENT OF DIRECTORS
Mr. Sanjay Bhatnagar
Mr. Sanjay Bhatnagar was appointed as an Additional Directoron the Board of the Company w.e.f. October 19, 2006. His presentterm is expiring at the ensuing Annual General Meeting. An itemfor his appointment as regular Director of the Company has beenincluded in the notice convening Annual General Meeting.
Brief resume of Mr. Sanjay Bhatnagar is as under:
Mr. Sanjay Bhatnagar is the CEO of the THOT Capital Group,which he established in March 2001. THOT Capital Group isactive in greenfield asset development and the origination,structuring, financing, operational management and buy-out ofcompanies. THOT’s asset buy-out activities are focused in theUS, European and Indian markets. THOT Capital Group alsomanages a Foreign Exchange fund through its affiliate EshanVentures.
Prior to setting up the THOT Capital Group, from 1993-2000,Mr. Bhatnagar, was the CEO of Enron Broadband Services,Middle East and Asia and Chairman and CEO, Enron SouthAsia (Energy), where his responsibilities included developingnew businesses in energy infrastructure, communications andbroadband services.
Mr. Bhatnagar also worked for Schlumberger, the oil fieldservices company, as an engineer and manager in severalSoutheast Asian countries (including Brunei, Singapore,Thailand, Philippines, Malaysia and Indonesia) and in France.His responsibilities included project development, marketing andoperations management.
Mr. Bhatnagar obtained a Bachelor’s degree in MechanicalEngineering with distinction from the Indian Institute ofTechnology in 1983. He is an MBA with Honors, from HarvardUniversity in 1993 and obtained a Master’s degree in Engineeringfrom Stanford University in 1989.
Mr. Bhatnagar is not a Director in any other public limitedcompany in India and is member of Audit Committee andRemuneration Committee of PLL. Mr. Bhatnagar is not holdingany share in the Company.
Mr. Scott R. Bayman
Mr. Scott R. Bayman was appointed as an Additional Director onthe Board of the Company w.e.f. June 1, 2007. His present termis expiring at the ensuing Annual General Meeting. An item forhis appointment as regular Director of the Company has beenincluded in the notice convening Annual General Meeting.
Brief resume of Mr. Scott R. Bayman is as under:
Mr. Scott R. Bayman is presently a corporate officer of the GeneralElectric Company and President and Chief Executive Officer ofGE - India.
Mr. Bayman joined GE in 1987 as Manager of BusinessDevelopment for GE Appliances in Louisville and the followingyear, he became Product General Manager for range products.In 1991, he was elected a GE Vice President responsible forAppliances Consumer Service and the following year, he wasappointed as Vice President, Worldwide Marketing and Productmanagement for GE Appliances. In April, 1993, Mr. Baymanassumed his present position and relocated to India.
Mr. Bayman serves on the International Advisory Boards of theIndian School of Business and the University of Pennsylvania’sCenter for the Advanced Study of India. He is a member of TheUniversity of Florida Warrington School of BusinessAdministration Business Advisory Council. He serves on theBoard of the US India Business Council and is past Chairman ofthe American Chamber of Commerce India. He is also on theBoard of Trustees of Aspen India.
Mr. Bayman’s previous work experience includes positions as aManagement Consultant with the firm of Booz, Allen & HamiltonInc. and Director of Corporate Strategic Planning for UnitedTechnologies Corporation. He has also worked for GeneralMotors and AT&T in a number of positions.
Mr. Bayman holds a Masters degree in Management from theAlfred P. Sloan School of Management, MIT, Massachusetts,where he was a Sloan Fellow. He graduated with a Bachelor ofScience degree in Business Administration from the Universityof Florida.
Directorship in other Public Companies and CommitteeMembership
Directorship in other Public CommitteeCompanies Membership
Crompton Greaves Ltd. –
Mr. Bayman is not holding any share in the Company.
Mr. P. K. Gupta
Mr. P. K. Gupta was appointed as an Additional Director andsubject to the Central Government approval Whole-time Directorof the Company w.e.f. June 1, 2007. His present term is expiringat the ensuing Annual General Meeting. An item for hisappointment as regular Director of the Company has beenincluded in the notice convening Annual General Meeting.
Brief resume of Mr. P K. Gupta is as under:
Mr. Gupta holds a degree in mechanical engineering from theThapar Institute of Engineering and Technology, Patiala andhas over 31 years of experience. He joined Punj Lloyd as DeputyGeneral Manager, Projects and now heads the South East Asiaoperations of the Company.
Mr. Gupta is also President Director of PT. Punj Lloyd Indonesiaand PT Sempec Indonesia, Director of Punj Lloyd Pte Ltd. andSembawang Engineers and Constructors Pte Ltd.
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 45 |
Mr. Gupta holds 17500 Equity Shares of Rs. 2/- each in theCompany.
MEANS OF COMMUNICATION WITH SHAREHOLDERS
As per the requirements of Listing Agreement, quarterly andannual results of PLL are published in two major national dailies.In addition, these results are also posted on the website of theCompany, whose address is www.punjlloyd.com. The websitealso contains other public domain information regarding PLL.
During 2006-07, PLL has not made any formal presentations toinstitutional investors or analysts. However, Company hadconference call with certain institutional investors and analysts.Transcripts of the same have been posted on the website.
LAST THREE ANNUAL GENERAL BODY MEETINGS
The details of the last three AGMs are given in Table 8.
Table 8 : Last three AGMs of the Company
Year Location Date Time/ No. of
A.M. Special
resolutions
passed
2003-04 Punj Lloyd House, 29.09.04 11.00 7
17-18, Nehru Place,
New Delhi 110 019
2004-05 Punj Lloyd House, 29.09.05 11.30 5
17-18, Nehru Place,
New Delhi 110 019
2005-06 FICCI Golden 22.09.06 11.30 3
Jubilee Auditorium,
Federation House,
Tansen Marg,
New Delhi - 110 001
POSTAL BALLOT
During the year, no resolution was passed through Postal Ballotand no resolution is proposed to be passed through postal ballot.
GENERAL SHAREHOLDER INFORMATION
19th ANNUAL GENERAL MEETING
Date: Friday, July 27, 2007
Time : 10.30 A.M.
Venue : Air Force Auditorium, Subroto Park,New Delhi 110 010.
BOOK CLOSURE DATE
The Share Transfer Register of PLL shall remain closed fromFriday, the 20th Day of July, 2007 to Friday, the 27th Day of July,2007 (both days inclusive).
TENTATIVE FINANCIAL CALENDAR FOR RESULTS,2007-08
The financial year of the Company is from 1st April to 31st March.The tentative schedule of financial results is as under:
First Quarter : Last week of July, 2007
Second Quarter : Last week of October, 2007
Third Quarter : Last week of January, 2008
Fourth Quarter and Annual : Last week of May, 2008
DIVIDEND AND DIVIDEND PAYMENT DATE
Dividend @ 15% on equity shares will be paid within stipulatedperiod, after its declaration by the members at the AGM.
LISTING ON STOCK EXCHANGES IN INDIA
PLL’s shares are listed on Bombay Stock Exchange Ltd. and theNational Stock Exchange of India Ltd. The Company has paidlisting fees to both BSE and NSE for the year 2007-08. The StockCode for the shares of the Company are:
BSE : 532693
NSE : PUNJLLOYD
STOCK MARKET DATA
Table 1 gives the monthly high and low quotations as well as thevolume of shares traded at BSE and NSE during 2006-07.
Table 1: Monthly Highs and Lows and Volumes Traded at theBSE and NSE, 2006-07
Year BSE NSE
2006-07 High Low No. of High Low No. of(Rs.) (Rs.) Shares (Rs.) (Rs.) Shares
April 1,150.00 970.05 1,381,562 1,158.00 970.10 2,688,901
May 1,254.90 700.00 2,136,363 1,254.00 700.00 5,890,286
June 945.00 668.95 2,082,614 920.00 662.50 3,653,335
July 769.90 544.00 3,086,528 769.00 540.15 5,394,625
August 788.00 593.00 3,228,571 788.50 591.00 7,017,818
September 877.30 679.95 3,346,157 842.00 732.05 7,458,838
October 805.00 710.00 2,158,964 806.80 735.00 5,122,284
November 1,094.40 745.00 8,507,878 1,092.90 752.00 12,360,469
December 1,124.40 873.20 4,887,898 1,125.00 870.15 11,350,330
January 1,090.00 976.50 1,999,175 1,089.95 976.20 5,321,280
February 1,085.00 755.00 3,151,982 1,086.00 720.00 8,689,219
March* 850.00 793.00 3,152,978 846.40 711.55 7,275,009
* The price of the share of the Company above are on the face value ofRs. 10/- each. The shareholders of the Company had approved thesub-division of the share of the Company from Rs. 10/- each to fiveequity share of Rs. 2/- each in their meeting held on March 6, 2007. Therecord date for the purpose was fixed on April 6, 2007. However, tradingin the shares with face value of Rs. 2/- started in BSE/NSE w.e.f. March29, 2007. Therefore the prices for last few days of March 2007 areadjusted to Rs. 10/- for the purpose of comparison.
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Chart 1 : Share prices of PLL Versus BSE Sensex for theyear ended March 31, 2007
During the year ended March 31, 2007, 442 shares of Rs. 10/-each were transferred in physical form.
DEPOSITORY SYSTEM
Shareholders can trade in the Company’s shares only inelectronic form. The process for getting the shares dematerialisedis as follows:
� Shareholder submits the shares certificate along withDematerialisation Request Form (DRF) to DepositoryParticipant (DP).
� DP processes the DRF and generates a uniqueDematerialisation Request No.
� DP forwards DRF and share certificates to Registrar andShare Transfer Agents (RTA).
� RTA after processing the DRF confirms or rejects the requestto Depositories.
� If confirmed by the RTA, depositories give credit toshareholder in his account maintained with DP.
This process takes approximately 10-15 days from the date ofreceipt of DRF.
As trading in shares of the Company can be done only inelectronic form, it is advisable that the shareholders who haveshares in physical form get their shares dematerialised.
DEMATERIALISATION OF SHARES AS ON MARCH 31, 2007
There were 88,454 shareholders holding 210,279,380 sharesof Rs. 2/- each in electronic form. This constitutes 80.49% of thetotal paid up share capital of the Company.
DISTRIBUTION OF SHAREHOLDING AS ON MARCH 31, 2007
Table 2 gives the distribution of shares according to shareholdingclass, while Table 3 gives the distribution of shareholding byownership.
Table 2 : Pattern of shareholding by share class as onMarch 31, 2007
No. of equity shares No. of % of No. of % ofheld share- share shares share
holders holders holding
1-500 87,454 98.86 11,203,080 4.29
501-1000 493 0.56 1,821,925 0.70
1001-2000 218 0.25 1,541,350 0.59
2001-3000 72 0.08 916,280 0.35
3001-4000 34 0.04 620,965 0.24
4001-5000 26 0.03 625,450 0.24
5001-10000 43 0.05 1,582,340 0.60
10001 and above 114 0.13 242,948,945 92.99
TOTAL 88,454 100.00 261,260,335 100.00
135
120
105
90
75
60
45
30
15
0
Chart A : PLL share price movement vis.a.vis SENSEX
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SENSEXPUNJ LLOYD LTD
NSE NIFTYPUNJ LLOYD LTD
Chart B : PLL share price movement vis.a.vis NIFTY
1351201101009080706050403020100
Apr-0
6Apr
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Note: Both Sensex and PLL share prices are indexed to 100 as on April 1, 2006
Chart 2: Share prices of PLL Versus NSE Nifty for the yearended March 31, 2007
Note: Both Nifty and PLL share prices are indexed to 100 as onApril 1, 2006
REGISTRAR AND SHARE TRANSFER AGENTS
M/s. Karvy Computershare Pvt. Ltd., Hyderabad are the Registrarand Share Transfer Agents of the Company for handling bothelectronic and physical shares.
SHARE TRANSFER SYSTEM IN PHYSICAL MODE
Share certificates sent for transfer are received at the RegisteredOffice of the Company or the office of Karvy Computershare Pvt.Ltd. All valid transfer requests are processed.
The Shareholders/Investors Grievance Committee approves thevalid transfer requests at regular intervals. After transfer, thephysical shares are sent to the shareholders.
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 47 |
Table 3 : Pattern of shareholding by ownership as onMarch 31, 2007
Category Shareholding
No. of Shareholdingshares held %
Promoters 140,869,640 53.92Mutual Funds & UTI 38,426,940 14.71Banks, Financial Institutions, 663,380 0.25Insurance CompaniesForeign Institutional Investors 24,426,965 9.35Private Corporate Bodies 9,342,535 3.58Foreign Venture Capital 21,505,675 8.23InvestorsIndian Public 22,442,185 8.59NRIs/OCBs 2,917,855 1.12Other (Including shares 665,160 0.25in transit)
Total 261,260,335 100.00
OUTSTANDING GDRS/ADRS/WARRANTS OR ANYCONVERTIBLE INSTRUMENTS, THEIR CONVERSION DATESAND LIKELY IMPACT ON EQUITY
During the year, the Company had issued Foreign CurrencyConvertible Bonds due 2011 (FCCB) for an aggregate value ofUS $ 125 million. The Bonds are convertible at any time betweenJuly 1, 2006 and March 24, 2011, by holders into fully paid equityshares of Rs. 10 each of the Company, representing one equityshare at an initial conversion price of Rs. 1362.94 per share witha fixed rate of exchange of Rs. 44.35 = US $ 1. The number ofshares and price will be subject appropriate adjustments due tosplit of one equity shares of Rs. 10/- each into five equity sharesof Rs. 2/- each. The conversion price is also subject to other
adjustments in certain circumstances as specified in the offeringmemorandum of FCCBs. The Bonds may also be redeemed, inwhole but not in part, at the option of the Company at any time onor after April 7, 2009 and prior to March 24, 2011, subject tosatisfaction of certain conditions. Unless previously converted,redeemed or purchased and cancelled, the Bonds will beredeemed on April 8, 2011 at 125.856% of their principal amount.The FCCBs are listed on Singapore Stock Exchange. Theproceeds of the FCCB issue are being utilized primarily to financeongoing capital expenditures, repayment of international debt,possible acquisitions outside India, investment in wholly ownedsubsidiaries/joint ventures abroad, investment in BOT projectsand any other use as may be permitted under applicable law orby the regulatory bodies, from time to time.
SITE LOCATIONS
The Company is engaged in providing integrated design,engineering, procurement, construction and project managementservices for energy and infrastructure sector. The projects areexecuted at the sites provided by the clients. The Company doesnot have any manufacturing facilities except a Central workshopsituated at Banmore Industrial Area, Banmore Dist., Morena,Madhya Pradesh 476 444 for carrying out repair andmaintenance of equipment.
ADDRESS FOR CORRESPONDENCECompany – Corporate Registrar & ShareOffice Transfer AgentDinesh Thairani K. S. ReddyCompany Secretary Sr. ManagerPunj Lloyd Limited Karvy Computershare Pvt.Corporate Office 1, Limited78, Institutional Area, Karvy House, 46, Avenue 4,Sector 32, Gurgaon Street No. 1, Banjara Hills,Haryana 122 001, India Hyderabad 500034Tel. No. +91-0124 2620493 Tel. No. 040 23420816Fax No. +91-0124-2620111 Fax No. 040 23420814e-mail: [email protected] e-mail: [email protected]
AUDITORS’ CERTIFICATETo
The Members of Punj Lloyd Limited
We have examined the compliance of conditions of corporate governance by Punj Lloyd Limited for the year ended onMarch 31, 2007, as stipulated in clause 49 of the Listing Agreement of the said Company with stock exchanges.
The compliance of conditions of corporate governance is the responsibility of the management. Our examination was limited toprocedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the CorporateGovernance. It is neither an audit nor an expression of opinion on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company hascomplied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.
We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency oreffectiveness with which the management has conducted the affairs of the Company.
S. R. BATLIBOI & CO.Chartered Accountantsper Raj AgrawalPartnerMembership No.: 82028Place : GurgaonDate : May 31, 2007
| 48 |
AN
NE
XU
RE
2
PA
RT
ICU
LA
RS
OF
EM
PL
OY
EE
S R
EQ
UIR
ED
UN
DE
R S
EC
TIO
N 2
17(2
A)
OF
TH
E C
OM
PA
NIE
S A
CT
, 19
56 R
EA
D W
ITH
TH
E C
OM
PA
NIE
S(P
AR
TIC
UL
AR
S O
F E
MP
LO
YE
ES
) R
UL
ES
, 197
5 A
ND
FO
RM
ING
PA
RT
OF
TH
E D
IRE
CT
OR
S’ R
EP
OR
T F
OR
TH
E Y
EA
R E
ND
ED
MA
RC
H 3
1, 2
007
Sl.
Nam
eD
esig
nat
ion
an
dR
emu
ner
atio
n (R
s.)
Qu
alif
icat
ion
sE
xper
ien
ce (
Yrs
.)D
ate
of
Age
Las
t em
plo
ymen
tN
o.n
atu
re o
f du
ties
com
men
cem
ent
(Y
rs.)
hel
d b
efo
re jo
inin
go
f em
plo
ymen
tth
e C
ompa
ny
Em
plo
yed
thro
ug
ho
ut t
he
year
:
1A
.K.
Kha
nna
Exe
cutiv
e D
irect
or2,
516,
918
B.E
.32
02.0
9.20
0256
Des
ign
Pvt
. Lt
d.
2A
mit
Kau
raS
r. G
ener
al M
anag
er4,
301,
140
B.
Tec
h.19
09.0
2.20
0640
Pun
j Gro
up
3A
tul K
umar
Jai
nE
xecu
tive
Dire
ctor
2,41
7,71
8B
.E.
2509
.06.
1982
46P
unj G
roup
4G
ora
Cha
nd B
asu
Exe
cutiv
e D
irect
or2,
500,
834
B.E
.33
08.0
1.19
9657
Brid
ge &
Roo
f C
o. (
I) L
td.
5H
.K.
Kau
lP
resi
dent
(Tec
hnic
al)
3,66
7,42
1B
.E.
(Ele
ct.)
4119
.07.
2005
62E
ngin
eers
Ind
ia L
td.
6Lu
v C
hhab
raD
irect
or (
Cor
pora
te A
ffairs
)6,
662,
997
B. T
ech,
MB
A30
01.0
7.20
0150
KE
C I
nter
natio
nal L
td.
7P
.K.
Gan
dhi
Pre
side
nt (H
RD
)3,
802,
738
PG
D25
30.0
9.20
0552
Bec
htel
Ltd
.
8P
rade
ep K
ulsh
rest
haE
xecu
tive
Dire
ctor
2,74
9,75
8M
.E.
2719
.08.
1998
49IR
CO
N I
nter
natio
nal L
td.
9R
aju
Kau
lE
xecu
tive
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ctor
2,93
6,64
9C
.A.,
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03.0
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rans
mis
sion
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.
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avin
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sal
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cutiv
e D
irect
or5,
638,
186
B.E
.25
22.1
1.20
0547
IOB
Ltd
.
11V
.K.
Kau
shik
Man
agin
g D
irect
or6,
949,
774
B.E
. (E
lect
.)38
01.1
1.20
0359
Pun
j Gro
up
Em
plo
yed
for
par
t of t
he
year
1A
nil A
ggar
wal
*C
hief
Fin
anci
al O
ffice
r4,
184,
553
C.A
., M
BA
2509
.01.
2006
49B
unge
Ind
ia P
vt.
Ltd.
2A
shw
ani D
ubey
Exe
cutiv
e D
irect
or21
2,64
1B
.E.,
MB
A.
2701
.03.
2007
49LM
L Lt
d.
3B
.R. P
illai
Pro
ject
Man
ager
261,
852
B.E
.34
27.0
2.20
0761
Pet
rone
t C
CK
Ltd
.
4E
lum
alai
Gov
inds
amy
QA
/QC
Man
ager
912,
680
B.E
.32
06.1
2.20
0656
BA
BC
O, B
ahra
in
5N
.R. D
asP
roje
ct M
anag
er3,
211,
916
B.E
.38
01.0
5.20
0661
Eng
inee
rs I
ndia
Ltd
.
6P
.K.
Gup
taP
resi
dent
(A
sia
Pac
ific)
31,8
9,04
5B
.E.
3306
.01.
1989
54P
unj G
roup
7S
anja
y D
wiv
edi*
Chi
ef E
xecu
tive
Offi
cer
1,74
3,42
9F
.C.C
.A,
2001
.07.
2000
47D
eloi
tte a
nd T
ouch
e(I
SP
Div
isio
n)A
.I.Q
.A,
C.I
.S.A
*C
ease
d t
o b
e em
plo
yees
of
the
Co
mp
any
NO
TE
S:
1.R
emun
erat
ion
incl
udes
sal
ary,
allo
wan
ces,
com
mis
sion
, ta
xabl
e va
lue
of p
erqu
isite
s, C
ompa
ny’s
con
trib
utio
n to
pro
vide
nt f
und
and
supe
rann
uatio
n fu
nd.
2.T
he a
bove
em
ploy
ees
are/
wer
e w
hole
tim
e em
ploy
ees
of t
he C
ompa
ny.
3.T
he c
ondi
tions
of
empl
oym
ent
of t
he M
anag
ing
Dire
ctor
, D
irect
or (
Cor
pora
te A
ffairs
) an
d em
ploy
ees
are
cont
ract
ual.
4.N
one
of t
he E
mpl
oyee
s is
rel
ativ
e of
any
Dire
ctor
.
Fo
r an
d o
n b
ehal
f o
f th
e B
oar
d
Sd
/-
Atu
l P
un
j
Ch
air
ma
n
Pla
ce :
Gur
gaon
Dat
e :
May
31,
200
7
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 49 |
ANNEXURE 3
PARTICULARS REQUIRED UNDER THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OFDIRECTORS) RULES, 1988
A. CONSERVATION OF ENERGY
The Company is in the construction business and consequently, the provisions of Section 217 (1)(e) of the Companies Act1956, in respect of total energy consumption and energy consumption per unit of production has not been provided as theseparticulars do not apply to the Company
B. FOREIGN EXCHANGE EARNINGS AND OUTGO
(a) Activities relating to export initiatives taken to increase exports, development of new export market for productand services and export plans:
During the year under review, your Company has through its wholly-owned subsidiary in Singapore viz. Punj Lloyd Pte Ltd(PLPL), acquired a 100% stake in SembCorp Engineers & Constructors (now known as Sembawang Engineers & Constructors)(SEC), a wholly-owned subsidiary of SembCorp Industries (SCI), a leading utilities and marine group in Asia at a considerationof Singapore Dollar 39.09 million. SEC is a design-and-build engineering and construction service provider with corecapabilities encompassing process & plant engineering, heavy civil engineering and building. SEC recorded consolidatedrevenue of 744 million Singapore Dollars for the ten months period ended on March 31, 2007. Simon-Carves Ltd., U.K., awholly owned subsidiary of SEC provides a complete multi-functional design and management services to deliver globalcapital programme requirements of key customers.
The Company has also been awarded large construction projects in Qatar, UAE, Oman, Yemen, Libya and Singaporeaggregating to USD 809.77 million.
The Company has been constantly making endeavor to explore new international markets and increase its export revenues.
(b) Total Foreign Exchange used and earned
Used (Rs. in ‘000)
Project Expenses (on cash basis) 397,476
Foreign Branch Expenses 5,498,734
Traveling (on cash basis) 31,017
Bandwidth charges (on cash basis) 75,994
Value of imports calculated on CIF basis (excluding foreign branches) – Stores, spares and other materials 493,463
Value of imports calculated on CIF basis (excluding foreign branches) – Capital Goods 1,896,449
Interest 1,441
Others (on cash basis) 211,167
Net Dividend remitted 15,208
Earned
Contract Revenues 7,564,061
Export at FOB Value 4,380
Hiring Charges 30,021
Interest Received 157,819
Management Fees 11,355
Insurance Claims 22,345
Others 8,895
For and on behalf of the Board
Sd/-Atul PunjChairman
Place : GurgaonDate : May 31, 2007
| 50 |
ST
AT
EM
EN
T P
UR
SU
AN
T T
O S
EC
TIO
N 2
12 O
F T
HE
CO
MP
AN
IES
AC
T, 1
956
RE
LA
TIN
G T
O T
HE
SU
BS
IDIA
RY
CO
MP
AN
IES
.
1. N
ame
of
the
Co
mp
any
PU
NJ
LL
OY
DP
T P
UN
JS
PE
CT
RA
PU
NJ
LLO
YD
PU
NJ
LLO
YD
SP
EC
TR
AA
TN
AP
UN
J L
LO
YD
SP
EC
TR
AP
LN
(MA
LA
YS
IA)
LLO
YD
PU
NJ
INC
.IN
TE
RN
AT
-IN
FR
AS
T-
INV
ES
T-
KA
ZA
KH
-P
UN
JAB
CO
NS
TR
UC
-S
DN
. B
HD
.IN
DO
NE
SIA
LLO
YD
ION
AL
RU
CT
UR
EM
EN
TS
ST
AN
LL
PL
IMIT
ED
TIO
N L
IMIT
ED
LIM
ITE
DL
IMIT
ED
LIM
ITE
DL
IMIT
ED
2.F
inan
cial
yea
r of t
he31
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
7C
ompa
ny e
nded
on:
3.E
xten
t of H
oldi
ng c
ompa
ny’s
100%
Pai
d-up
100%
Pai
d-up
97.4
4% P
aid-
up10
0% P
aid-
up10
0% P
aid-
up10
0% P
aid-
up10
0% P
aid-
up10
0% P
aid-
up10
0% P
aid-
up10
0% P
aid-
upin
tere
st in
the
subs
idia
ry C
ompa
ny.
Sha
re C
apita
lS
hare
Cap
ital
Sha
re C
apita
lS
hare
Cap
ital
Sha
re C
apita
l S
hare
Cap
ital
Sha
re C
apita
l S
hare
Cap
ital
Sha
re C
apita
lS
hare
Cap
ital
3. (I
) Num
ber o
f Sha
res
held
/Am
ount
3,66
1,25
5 E
quity
7,80
5 E
quity
4,87
1,85
020
0,00
0 E
quity
100,
000
Equ
ity11
,500
,200
399,
221
Equ
ityC
hart
er C
apita
l90
0,00
0 E
quity
2,00
0,00
0 E
quity
of C
apita
l Sub
scrib
ed.
Sha
res
of R
M I
Sha
res
of U
SD
Equ
ity S
hare
sS
hare
s of
US
D 1
Sha
reso
f US
D 1
Equ
ity S
hare
s S
hare
s of
am
ount
ing
toS
hare
s of
Sha
res
of R
s. 1
0/-
each
agg
greg
atin
g50
0 ea
chof
Rs.
10/
- eac
hea
ch a
ggre
gatin
gea
ch a
ggre
gatin
gof
Rs.
10/
- eac
hR
s. 1
00/-
eac
h K
ZT,
Rs.
10/
- eac
hea
ch a
ggre
gatin
gto
RM
3.6
61,2
55ag
greg
a tin
g to
aggr
egat
ing
to to
US
D 2
00,0
00to
US
D 1
00,0
00ag
greg
atin
g to
aggr
egat
ing
1,10
7,97
7,20
0ag
greg
atin
g to
to R
s. 2
0,00
0,00
0eq
uiva
lent
toU
SD
3,9
02,5
00R
s. 4
8,71
8,50
0eq
uiva
lent
toeq
uiva
lent
toR
s. 1
15,0
02,0
00to
Rs.
1eq
uiva
lent
to R
s. 9
,000
,000
Rs.
44,
441,
000
equi
va le
nt t
o R
s. 8
,493
,000
Rs.
4,4
51,7
50 3
9,92
2,10
0 R
s. 3
62,7
98,0
00R
s. 1
70,9
00,1
25
4.T
he n
et a
ggre
gate
am
ount
of
Und
er w
indi
ng u
pR
s.R
s.U
nder
win
ding
up
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
prof
it/lo
ss o
f sub
sidi
ary
to th
eex
tent
it c
once
rns
the
mem
bers
of
hold
ing
Com
pany
wer
e :
a)N
ot d
ealt
with
in H
oldi
ngC
ompa
ny’s
acc
ount
:(i
)F
or th
e fin
anci
al y
ear e
nded
31.0
3.20
0718
2,56
6,44
073
0,38
064
,943
454
,402
(21,
442,
600)
3,07
1,43
1N
il22
,808
,128
(ii)
For t
he p
revi
ous
finan
cial
yea
rsof
the
subs
idia
ry C
ompa
nies
sinc
e th
ey b
ecam
e th
e ho
ldin
gC
ompa
ny’s
Sub
sidi
ary
780,
178,
022
64,6
70,2
8234
,727
,334
(409
,205
) (1
,901
,575
)85
,577
,356
Nil
49,0
20,5
82b)
Dea
lt w
ithin
hol
ding
Com
pani
esA
ccou
nt(i
)F
or th
e fin
anci
al y
ear e
nded
31.0
3.20
07N
ilN
ilN
ilN
ilN
ilN
ilN
ilN
ilN
ilN
il(i
i)F
or th
e pr
evio
us fi
nanc
ial
year
s of
the
subs
idia
ryC
ompa
nies
sin
ce th
ey b
ecam
e th
e ho
ldin
gC
ompa
ny’s
Sub
sidi
ary
Nil
Nil
9,01
2,01
618
,915
,000
14,3
03,0
00N
ilN
ilN
ilN
ilN
il
(a)
The
Com
pany
alo
ngw
ith it
s su
bsid
iary
Atn
a In
vest
men
ts L
imite
d ho
ldin
g 73
.35%
of t
he P
aid
up E
quity
Cap
ital o
f Spe
ctra
Net
Lim
ited
and
the
amou
nt s
how
n un
der 4
(a) a
bove
repr
esen
t the
net
agg
rega
te a
mou
nt o
f los
ses
of th
esu
bsid
iary
attr
ibut
able
to th
e di
rect
hol
ding
of t
he C
ompa
ny.
FO
R A
ND
ON
BE
HA
LF
OF
TH
E B
OA
RD
Sd/
-A
TU
L P
UN
JC
HA
IRM
AN
PLA
CE
: G
UR
GA
ON
DA
TE
:
May
31,
200
7
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 51 |
ST
AT
EM
EN
T P
UR
SU
AN
T T
O S
EC
TIO
N 2
12 O
F T
HE
CO
MP
AN
IES
AC
T, 1
956
RE
LA
TIN
G T
O T
HE
SU
BS
IDIA
RY
CO
MP
AN
IES
(Co
ntd
.)
1. N
ame
of
the
Co
mp
any
SP
EC
TR
AP
UN
J L
LO
YD
SIM
AN
SP
EC
TR
AN
ET
PT
SE
MP
EC
SE
MB
AW
AN
GS
IMA
N-
SIM
AN
SE
MB
AA
NG
SE
MB
AA
NG
NE
T L
IMIT
ED
PT
E. L
TD
.C
UR
VE
SH
OL
DIN
GIN
DO
NE
SIA
EN
GIN
EE
RS
CA
RV
ES
CA
RV
ES
DE
CO
NS
TR
U-
DE
VE
LO
P-
(SN
L)
(PL
PL
)IN
DIA
LIM
ITE
D&
CO
NS
TR
U-
LIM
ITE
DM
EX
ICO
S.A
.C
TIO
N P
TE
ME
NT
PT
EL
IMIT
ED
CT
OR
S P
TE
(SC
L)
DE
C.V
.LT
D.
LTD
. L
TD
. (S
EC
)
2.F
inan
cial
yea
r of t
he31
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
7C
ompa
ny e
nded
on:
3.E
xten
t of H
oldi
ng c
ompa
ny’s
23.4
7% P
aid-
up10
0% P
aid-
up10
0% P
aid-
up10
0% S
ubsi
di-
100%
Sub
sidi
-10
0% S
ubsi
di-
100%
Sub
sidi
-10
0% S
ubsi
di-
100%
Sub
sidi
-10
0% S
ubsi
di-
inte
rest
in th
e su
bsid
iary
Com
pany
. S
hare
Cap
ital (
a)S
hare
Cap
ital
Sha
re C
apita
lar
y of
SN
Lar
y of
PLP
L a
ry o
f PLP
L a
ry o
f SE
C a
ry o
f SE
Lar
y of
SE
Car
y of
SE
C
3. (I
) Num
ber o
f Sha
res
held
/Am
ount
1,70
6,10
2 E
quity
2300
00 s
hare
s20
,000
,000
As
stat
edA
s st
ated
As
stat
edA
s st
ated
As
stat
edA
s st
ated
As
stat
edof
Cap
ital S
ubsc
ribed
.S
hare
s of
Rs.
10/
-of
S$
100
each
Equ
ity S
hare
sab
ove
abo
veab
ove
abov
eab
ove
abov
eab
ove
each
agg
rega
ting
and
1 sh
are
ofof
Rs.
10/
- eac
hto
Rs.
17,
061,
020
S$
1 ea
chag
greg
atin
g to
aggr
egat
ing
toR
s. 2
,00,
00,0
00S
$ 23
,000
0,00
1eq
uiva
lent
toR
s. 6
73,7
98,6
68
4.T
he n
et a
ggre
gate
am
ount
of
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
prof
it/lo
ss o
f sub
sidi
ary
to th
eex
tent
it c
once
rns
the
mem
bers
of
hold
ing
Com
pany
wer
e :
a)N
ot d
ealt
with
in H
oldi
ngC
ompa
ny’s
acc
ount
:N
ilN
ilN
ilN
ilN
ilN
ilN
il
(i)
For
the
finan
cial
yea
r end
ed31
.03.
2007
(10,
517,
410)
(7,1
31,8
50)
Nil
Nil
Nil
Nil
Nil
Nil
Nil
(ii)
For t
he p
revi
ous
finan
cial
yea
rsof
the
subs
idia
ry C
ompa
nies
sinc
e th
ey b
ecam
e th
e ho
ldin
gC
ompa
ny’s
Sub
sidi
ary
(10,
104,
594)
Nil
Nil
b)D
ealt
with
in h
oldi
ng C
ompa
nies
Acc
ount
(i)
For
the
finan
cial
yea
r end
ed31
.03.
2007
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
(ii)
For
the
prev
ious
fina
ncia
lye
ars
of th
e su
bsid
iary
Com
pani
es s
ince
they
bec
ame
the
hold
ing
Com
pany
’s S
ubsi
diar
y(1
4,66
8,84
4)N
ilN
ilN
ilN
ilN
ilN
ilN
ilN
ilN
il
(a)
The
Com
pany
alo
gwith
its
subs
idia
ry A
tna
Inve
stm
ets
Lim
ites
hold
ing
73.3
5% o
f the
Pai
d up
Equ
ity C
apita
l of S
pect
ra N
et L
imite
d an
d th
e am
ount
sho
wn
unde
r 4(a
) abo
ve re
pres
ent t
he n
et a
ggre
gate
am
ount
of l
osse
s of
the
subs
idia
ry a
ttrib
utab
le to
the
dire
ct h
oldi
ng o
f the
Com
pany
.
FO
R A
ND
ON
BE
HA
LF
OF
TH
E B
OA
RD
Sd/
-A
TU
L P
UN
JC
HA
IRM
AN
PLA
CE
: G
UR
GA
ON
DA
TE
:
May
31,
200
7
| 52 |
ST
AT
EM
EN
T P
UR
SU
AN
T T
O S
EC
TIO
N 2
12 O
F T
HE
CO
MP
AN
IES
AC
T, 1
956
RE
LA
TIN
G T
O T
HE
SU
BS
IDIA
RY
CO
MP
AN
IES
(Co
ntd
.)
1. N
ame
of
the
Co
mp
any
PT
IND
OC
ON
ST
RU
-C
ON
TE
CH
CO
NS
TR
U-
SE
MB
AW
AN
GS
EM
BA
WA
NG
SC
AR
CH
I-S
EM
BA
WA
NG
JUR
UB
INA
SE
MB
AW
AN
G P
RE
CA
ST
CT
ION
TE
CH
-T
RA
DIN
GC
TIO
N T
EC
H-
INF
RA
ST
RU
CT
INF
RA
ST
RU
CT
TE
CT
S &
(MA
LA
YS
IA)
SE
MB
AW
AN
GE
NG
INE
ER
SU
TA
MA
NO
LO
GY
PT
EP
TE
LT
DN
OL
OG
Y (
B)
UR
E (
MA
UR
I-U
RE
(IN
DIA
)E
NG
INE
ER
SS
DN
BH
D(M
) S
DN
BH
DA
ND
CO
NS
T-
LIM
ITE
DS
DN
. B
HD
.T
IUS
) LT
D.
PV
T. L
TD.
PT
E L
TD
.R
UC
TO
RS
MID
DL
EE
AS
T E
ZE
2.F
inan
cial
yea
r of t
he31
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
7C
ompa
ny e
nded
on:
3.E
xten
t of H
oldi
ng c
ompa
ny’s
100%
Sub
sidi
-10
0% S
ubsi
di-
100%
Sub
sidi
-10
0% S
ubsi
di-
100%
Sub
sidi
-10
0% S
ubsi
di-
100%
Sub
sidi
-10
0% S
ubsi
di-
100%
Sub
sidi
-10
0% S
ubsi
di-
inte
rest
in th
e su
bsid
iary
Com
pany
.ar
y of
SE
Car
y of
SE
Car
y of
SE
Car
y of
SE
Car
y of
SE
Car
y of
SE
C a
ry o
f SE
Car
y of
SE
Car
y of
SE
Car
y of
SE
C
3. (I
) Num
ber o
f Sha
res
held
/Am
ount
As
stat
edA
s st
ated
As
stat
edA
s st
ated
As
stat
edA
s st
ated
As
stat
edA
s st
ated
As
stat
edA
s st
ated
of C
apita
l Sub
scrib
ed.
abov
eab
ove
abov
eab
ove
abo
veab
ove
abov
eab
ove
abov
eab
ove
4.T
he n
et a
ggre
gate
am
ount
of
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
prof
it/lo
ss o
f sub
sidi
ary
to th
eex
tent
it c
once
rns
the
mem
bers
of
hold
ing
Com
pany
wer
e :
a)N
ot d
ealt
with
in H
oldi
ngN
ilN
ilN
ilN
ilN
ilN
ilN
ilN
ilN
ilN
ilC
ompa
ny’s
acc
ount
:(i
)F
or th
e fin
anci
al y
ear e
nded
31.0
3.20
07N
il N
ilN
ilN
ilN
ilN
ilN
ilN
ilN
ilN
il(i
i)Fo
r the
pre
viou
s fin
anci
al y
ears
of th
e su
bsid
iary
Com
pani
essi
nce
they
bec
ame
the
hold
ing
Com
pany
’s S
ubsi
diar
yb)
Dea
lt w
ithin
hol
ding
Com
pani
esA
ccou
nt(i
)F
or th
e fin
anci
al y
ear e
nded
31.0
3.20
07N
ilN
ilN
ilN
ilN
ilN
ilN
ilN
ilN
ilN
il(i
i)F
or th
e pr
evio
us fi
nanc
ial
year
s of
the
subs
idia
ryC
ompa
nies
sin
ce th
ey b
ecam
e th
e ho
ldin
gC
ompa
ny’s
Sub
sidi
ary
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
(a)
The
Com
pany
alo
gwith
its
subs
idia
ry A
tna
Inve
stm
ets
Lim
ites
hold
ing
73.3
5% o
f the
Pai
d up
Equ
ity C
apita
l of S
pect
ra N
et L
imite
d an
d th
e am
ount
sho
wn
unde
r 4(a
) abo
ve re
pres
ent t
he n
et a
ggre
gate
am
ount
of l
osse
s of
the
subs
idia
ry a
ttrib
utab
le to
the
dire
ct h
oldi
ng o
f the
Com
pany
.
FO
R A
ND
ON
BE
HA
LF
OF
TH
E B
OA
RD
Sd/
-A
TU
L P
UN
JC
HA
IRM
AN
PLA
CE
: G
UR
GA
ON
DA
TE
:
May
31,
200
7
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 53 |
ST
AT
EM
EN
T P
UR
SU
AN
T T
O S
EC
TIO
N 2
12 O
F T
HE
CO
MP
AN
IES
AC
T, 1
956
RE
LA
TIN
G T
O T
HE
SU
BS
IDIA
RY
CO
MP
AN
IES
(Co
ntd
.)
1. N
ame
of
the
Co
mp
any
WU
XI X
IAP
T S
YN
ER
GY
SE
MB
AW
AN
GS
EM
BA
WA
NG
PT
IND
OP
T C
ON
TE
CH
SE
MB
AW
AN
GL
IAN
PR
EC
AS
TT
EC
HN
OL
OG
Y(H
EB
EI)
(TIA
NJI
N)
UN
GG
UL
BU
LA
NJT
CI
(CH
INA
) M
AN
UF
AC
TU
RIN
GC
ON
ST
RU
CT
ION
BU
ILD
ING
CO
NS
TR
UC
TIO
NW
AS
TU
RA
YA
PT
E L
TD
CO
. LT
D.
MA
TE
RIA
LS
EN
GIN
EE
RIN
GC
O. L
TD
.C
O. L
TD
.
2.F
inan
cial
yea
r of t
he31
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
731
-Mar
-07
31-M
ar-0
731
-Mar
-07
Com
pany
end
ed o
n:
3.E
xten
t of H
oldi
ng c
ompa
ny’s
85%
Sub
sidi
-80
% S
ubsi
di-
75%
Sub
sidi
-70
% S
ubsi
di-
67%
Sub
sidi
-60
% S
ubsi
di-
51%
Sub
sidi
-in
tere
st in
the
subs
idia
ry C
ompa
ny.
ary
of S
EC
ary
of S
EC
ary
of S
EC
ary
of S
EC
ary
of S
EC
ary
of S
EC
ary
of S
EC
3. (I
) Num
ber o
f Sha
res
held
/Am
ount
As
stat
edA
s st
ated
As
stat
edA
s st
ated
As
stat
edA
s st
ated
As
stat
edof
Cap
ital S
ubsc
ribed
.ab
ove
abov
eab
ove
abov
e a
bove
abov
eab
ove
4.T
he n
et a
ggre
gate
am
ount
of
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
Rs.
prof
it/lo
ss o
f sub
sidi
ary
to th
eex
tent
it c
once
rns
the
mem
bers
of
hold
ing
Com
pany
wer
e :
a)N
ot d
ealt
with
in H
oldi
ngC
ompa
ny’s
acc
ount
:N
il N
ilN
ilN
ilN
ilN
ilN
il(i
)F
or th
e fin
anci
al y
ear e
nded
31.0
3.20
07N
il N
ilN
ilN
ilN
ilN
ilN
il(i
i)Fo
r the
pre
viou
s fin
anci
al y
ears
of th
e su
bsid
iary
Com
pani
essi
nce
they
bec
ame
the
hold
ing
Com
pany
’s S
ubsi
diar
yb)
Dea
lt w
ithin
hol
ding
Com
pani
esA
ccou
nt(i
)F
or th
e fin
anci
al y
ear e
nded
31.0
3.20
07N
ilN
ilN
ilN
ilN
ilN
ilN
il(i
i)F
or th
e pr
evio
us fi
nanc
ial
year
s of
the
subs
idia
ryC
ompa
nies
sin
ce th
ey b
ecam
e th
e ho
ldin
gC
ompa
ny’s
Sub
sidi
ary
Nil
Nil
Nil
Nil
Nil
Nil
Nil
(a)T
he C
ompa
ny a
logw
ith it
s su
bsid
iary
Atn
a In
vest
met
s Li
mite
s ho
ldin
g 73
.35%
of t
he P
aid
up E
quity
Cap
ital o
f Spe
ctra
Net
Lim
ited
and
the
amou
nt s
how
n un
der 4
(a) a
bove
repr
esen
t the
net
agg
rega
te a
mou
nt o
f los
ses
of th
esu
bsid
iary
attr
ibut
able
to th
e di
rect
hol
ding
of t
he C
ompa
ny.
FO
R A
ND
ON
BE
HA
LF
OF
TH
E B
OA
RD
Sd/
-A
TU
L P
UN
JC
HA
IRM
AN
PLA
CE
: G
UR
GA
ON
DA
TE
:
May
31,
200
7
| 54 |
DE
TA
ILS
OF
SU
BS
IDIA
RY
CO
MP
AN
IES
PU
RS
UA
NT
TO
TH
E C
EN
TR
AL
GO
VE
RN
ME
NT
OR
DE
R N
O.
47/7
8/20
07-C
L-I
II D
AT
ED
MA
RC
H 6
, 20
07U
ND
ER
SE
CT
ION
212
(8)
OF
TH
E C
OM
PA
NIE
S A
CT
, 19
56
Pun
j Llo
yd (M
alay
sia)
PT
Pun
j Llo
ydSp
ectra
Pun
j Llo
yd IN
C. #
Pun
j Llo
ydSp
ectra
Atn
aP
unj L
loyd
Kaz
akhs
tan
SD
N. B
HD
. #
Indo
nesi
a #
Pun
Llo
yd (U
nder
win
ding
up)
Inte
rnat
iona
lIn
frast
ruct
ure
Inve
stm
ents
LLP
#(U
nder
win
ding
up)
Lim
ited
Lim
ited
#Li
mite
dLi
mite
d
IN M
YR
IN I
NR
IN M
illi
on
ID
RIN
IN
RIN
IN
RIN
US
DIN
IN
RIN
US
DIN
IN
RIN
IN
RIN
IN
RIN
KZ
TIN
IN
R
CA
PIT
AL
--
36
,61
41
70
,90
0,1
25
50
,00
0,0
00
--
10
0,0
00
4,4
51
,75
01
15
,00
2,0
00
39
,92
2,1
00
1,1
07
,97
7,2
00
36
2,7
98
,00
8
RE
SE
RV
ES
--
19
7,2
28
91
7,9
05
,48
46
8,3
61
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8-
-7
79
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33
2,3
45
,90
04
5,1
97
(23
,34
4,1
75
)1
34
,96
0,6
18
91
,49
5,7
65
TO
TA
L A
SS
ET
--
63
1,4
94
2,9
80
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1,6
80
26
0,2
65
,44
4-
-9
31
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74
0,4
20
,92
01
15
,16
6,6
85
45
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6,1
64
4,4
60
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5,5
78
1,6
30
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5,6
09
TO
TA
L L
IAB
ILIT
IES
--
63
1,4
94
2,9
80
,65
1,6
80
26
0,2
65
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4-
-9
31
,78
74
0,4
20
,92
01
15
,16
6,6
85
45
,17
6,1
64
4,4
60
,94
5,5
78
1,6
30
,47
5,6
09
INV
ES
TM
EN
TS
--
--
--
-5
0,0
00
2,1
69
,00
05
,00
0,0
40
15
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0,8
65
--
TU
RN
OV
ER
/ T
OT
AL
IN
CO
ME
--
57
7,5
65
2,8
41
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9,8
00
48
8,7
80
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8-
-4
0,0
00
1,8
10
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48
40
,00
06
,55
02
,58
6,9
87
,00
01
,03
4,6
67
,94
6
PR
OF
IT B
EF
OR
E T
AX
AT
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--
52
,87
02
60
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0,4
00
4,4
93
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8-
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56
4,9
43
74
0,8
98
(21
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2,6
00
)9
8,6
61
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73
7,5
36
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1
PR
OV
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N F
OR
TA
XA
TIO
N-
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5,7
63
77
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3,9
60
3,7
62
,88
8-
--
-2
86
,49
6-
89
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7,2
65
34
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2,3
13
PR
OF
IT A
FT
ER
TA
XA
TIO
N-
-3
7,1
07
18
2,5
66
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07
30
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43
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02
(21
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00
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3,9
62
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8
PR
OP
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IDE
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--
--
--
--
--
--
-
Spec
tra
Punj
abLi
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NC
onst
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Lim
ited
Pun
j Llo
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TE L
imite
d #
Sim
on C
arve
sIn
dia
Lim
ited
Spec
trane
tH
oldi
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Lim
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PT
Sem
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Indo
nesi
a *
Spec
traN
et L
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g En
gine
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&C
onst
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. Ltd
. *S
imon
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ves
Lim
ited
*
IN I
NR
IN I
NR
IN I
NR
IN S
GD
IN I
NR
IN I
NR
IN I
NR
IN U
SD
IN I
NR
IN S
GD
IN I
NR
IN G
BP
IN I
NR
CA
PIT
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9,0
00,0
0020
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,000
72,6
91,2
1023
,000
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652,
970,
028
20,0
00,0
0020
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6,68
4,75
832
7,77
3,48
016
6,00
0,00
04,
712,
740,
000
380,
000
28,1
46,1
02
RE
SE
RV
ES
-71
,828
,710
(53,
570,
644)
20,0
66,5
6156
9,68
9,66
7(7
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)(5
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)(3
98,2
88)
(54,
872,
788)
(87,
088,
735)
(2,4
72,4
49,1
87)
1,25
4,10
010
9,73
1,18
3
TO
TA
L A
SS
ET
63,3
93,9
8032
0,69
7,41
874
,955
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173,
466,
352
4,92
4,70
9,73
322
,214
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15,0
53,1
1625
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1,12
3,07
2,57
235
4,91
5,09
410
,076
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96,8
35,2
968,
170,
485,
827
TO
TA
L LI
AB
ILIT
IES
63,
393,
980
320,
697,
418
74,9
55,0
3117
3,46
6,35
24,
924,
709,
733
22,2
14,6
5815
,053
,116
25,2
45,1
841,
123,
072,
572
354,
915,
094
10,0
76,0
39,5
1996
,835
,296
8,17
0,48
5,82
7
INV
ES
TM
EN
TS
--
14,9
11,5
0049
,953
,733
1,41
8,18
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PR
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IT B
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Parti
cula
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Parti
cula
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A n n u a l R e v i e w 2 0 0 6 - 0 7 | 55 |
DE
TA
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OF
SU
BS
IDIA
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CO
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AN
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PU
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UA
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TO
TH
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8/20
07-C
L-I
II D
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MA
RC
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, 20
07U
ND
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SE
CT
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212
(8)
OF
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| 56 |
DE
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OF
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CO
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PU
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TO
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07-C
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MA
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, 20
07U
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ER
SE
CT
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212
(8)
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Parti
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A n n u a l R e v i e w 2 0 0 6 - 0 7 | 57 |
To
The Members of Punj Lloyd Limited
1 We have audited the attached Balance Sheet of Punj LloydLimited as at March 31, 2007 and also the Profit and LossAccount and the Cash Flow Statement for the year endedon that date annexed thereto in which are incorporatedthe returns from Oman, Abu Dhabi, Indonesia, Yemen,Qatar, Libya and Singapore Branches; an UnincorporatedJoint Venture in Turkey and an Unincorporated JointVenture in India audited by other auditors. These financialstatements are the responsibility of the Company’smanagement. Our responsibility is to express an opinionon these financial statements based on our audit.
2 We conducted our audit in accordance with auditingstandards generally accepted in India. Those Standardsrequire that we plan and perform the audit to obtainreasonable assurance about whether the financialstatements are free of material misstatement. An auditincludes examining, on a test basis, evidence supportingthe amounts and disclosures in the financial statements.An audit also includes assessing the accounting principlesused and significant estimates made by management, aswell as evaluating the overall financial statementpresentation. We believe that our audit provides areasonable basis for our opinion.
3 As required by the Companies (Auditor’s Report) Order,2003 (as amended) issued by the Central Government ofIndia in terms of sub-section (4A) of Section 227 of theCompanies Act, 1956, we enclose in the Annexure astatement on the matters specified in paragraphs 4 and 5of the said Order.
4 Further to our comments in the Annexure referred to above,we report that:
i We have obtained all the information andexplanations, which to the best of our knowledge andbelief were necessary for the purposes of our audit;
ii In our opinion, proper books of account as requiredby law have been kept by the Company so far asappears from our examination of those books andproper returns adequate for the purposes of our audithave been received from branches andunincorporated joint ventures not visited by us. Thebranch/ joint venture auditors’ report(s) have beenforwarded to us and have been appropriately dealtwith;
iii The Balance Sheet, Profit and Loss Account and CashFlow Statement dealt with by this report are inagreement with the books of account and with theaudited returns received from the branches/ jointventures;
Auditors’ Reportiv In our opinion, the Balance Sheet, Profit and Loss
Account and Cash Flow Statement dealt with by thisreport comply with the accounting standards referredto in sub-section (3C) of section 211 of the CompaniesAct, 1956;
v On the basis of the written representations receivedfrom the directors, as on March 31, 2007, and takenon record by the Board of Directors, we report thatnone of the directors is disqualified as on March 31,2007 from being appointed as a director in terms ofclause (g) of sub-section (1) of section 274 of theCompanies Act, 1956.
vi Included in sundry debtors is an amount of Rs.292,671 thousand (previous year Rs.301,016thousand) related to contract work with Spie Capag-Petrofac International Limited (SCPIL) in Georgia.Additionally sundry debtors include an amount of Rs.74,860 thousand (previous year Rs. 77,000 thousand)from SCPIL for expenses incurred on behalf of SCPIL.Further, as stated in Note 11 in Schedule ‘N’ to thefinancial statements, the terms of the related contractis currently in dispute. Accordingly, we were unableto satisfy ourselves as to the recoverability of thesundry debtors amounting to Rs.367,531 thousand(previous year Rs.378,016 thousand).
Also, as stated in Note 11 in Schedule ‘N’ to thefinancial statements, the Company has raisedvariation orders of Rs. 1,448,892 thousand (previousyear Rs.1,490,000 thousand) on SCPIL and SCPILhave raised debit notes of Rs.464,166 thousand(previous year Rs. 477,400 thousand) on theCompany. These variation orders and debit notes arebeing disputed and have not been agreed betweenthe Company and SCPIL. However, the ultimateoutcome of the dispute cannot presently bedetermined by the Company. Because of thesignificance of this matter, we do not express anopinion on the impact of the above uncertainty on thefinancial statements. Our previous year audit reportwas also qualified in respect of the same matter.
vii Without qualifying our opinion, we draw attention toNote 10 in Schedule ‘N’ to the financial statementsregarding deductions made/ amounts withheld bysome customers aggregating to Rs. 760,671 thousand(previous year Rs.766,322 thousand) on variousaccounts which are being carried as sundry debtors.The Company is also carrying Work-in-Progressinventory of Rs 64,000 thousand (previous year Rs.64,000 thousand) relating to one of these cases. Theultimate outcome of the above matters cannotpresently be determined although the Company is ofthe view that such amounts are recoverable andhence no provision is required there against.
| 58 |
viii Subject to our comments in paragraph vi above, theimpact whereof on the Company’s profits is notascertainable, in our opinion and to the best of ourinformation and according to the explanations givento us, the said accounts give the information requiredby the Companies Act, 1956, in the manner sorequired and give a true and fair view in conformitywith the accounting principles generally accepted inIndia;
(a) In the case of the Balance Sheet, of the state ofaffairs of the Company as at March 31, 2007;
(b) In the case of the Profit and Loss Account, of theprofit of the Company for the year ended on thatdate; and
(c) In the case of Cash Flow Statement, of the cashflows of the Company for the year ended on thatdate.
S. R. BATLIBOI & CO.Chartered Accountants
per RAJ AGRAWAL
PartnerMembership No.: 82028
Place : GurgaonDate : May 31, 2007
ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OURREPORT OF EVEN DATE
RE: PUNJ LLOYD LIMITED
(i) (a) The Company has maintained proper recordsshowing full particulars, including quantitative detailsand situation of fixed assets.
(b) All fixed assets have not been physically verified bythe management during the year but there is aregular programme of verification which, in ouropinion, is reasonable having regard to the size ofthe Company and the nature of its assets. Asinformed, no material discrepancies were noticedon such verification.
(c) There was no substantial disposal of fixed assetsduring the year.
(ii) (a) The management has conducted physicalverification of inventory at reasonable intervalsduring the year.
(b) The procedures of physical verification of inventoryfollowed by the management are reasonable andadequate in relation to the size of the Company andthe nature of its business.
(c) The Company is maintaining proper records ofinventory and no material discrepancies werenoticed on physical verification.
(iii) (a-d) As informed, the Company has not granted anyloans, secured or unsecured, to companies, firms or otherparties covered in the register maintained under section301 of the Companies Act, 1956. Accordingly clauses 4(iii) (b, c and d) of the Companies (Auditor’s Report) Order,2003 (as amended) are not applicable to the Company.
(e-g) As informed, the Company has not taken any loans,secured or unsecured, from companies, firms or otherparties covered in the register maintained under section301 of the Companies Act, 1956. Accordingly, clauses 4(iii) (e, f and g) of the Companies (Auditor’s Report) Order,2003 (as amended) are not applicable to the Company.
(iv) In our opinion and according to the information andexplanations given to us, there is an adequate internalcontrol system commensurate with the size of theCompany and the nature of its business for the purchaseof inventory and fixed assets and for the sale of goodsand services. During the course of our audit, no majorweakness has been noticed in the internal control systemin respect of these areas.
(v) According to the information and explanations providedby the management, we are of the opinion that there areno contracts or arrangements that need to be entered intothe register maintained under section 301 of theCompanies Act, 1956. Accordingly, clause (v) (b) of theCompanies (Auditor’s Report) Order, 2003 (as amended)is not applicable to the Company.
(vi) The Company has not accepted any deposits from thepublic.
(vii) In our opinion, the Company has an internal audit systemcommensurate with the size and nature of its business.
(viii) To the best of our knowledge and as explained, the CentralGovernment has not prescribed maintenance of costrecords under clause (d) of sub-section (1) of section 209of the Companies Act, 1956 for the products/ services ofthe Company.
(ix) (a) Undisputed statutory dues including provident fund,investor education and protection fund, employees’state insurance, income-tax, sales-tax, wealth-tax,service tax, custom duty, excise duty and cess havegenerally been regularly deposited with theappropriate authorities though there have beendelays in some cases.
(b) According to the information and explanations givento us, no undisputed amounts payable in respect ofprovident fund, investor education and protectionfund, employees’ state insurance, income-tax,wealth-tax, service tax, sales-tax, customs duty,
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 59 |
Name of the Nature of dues Amount (Rs in ’000) Period to which Forum where disputestatute the amount relates is pending
Andhra Pradesh Sales Tax on the 2,550 1998-99 and Sales Tax AppellateGeneral Sales material components 2000-2001 Tribunal, Hyderabad.Tax Act, 1956 of the works contract. Andra Pradesh
Andhra Pradesh Sales Tax on the material 19,897 2003-2004 Deputy Commissioner,General Sales components of the works Sales Tax (Appeals),Tax Act, 1956 contract. Vizag, Andhra Pradesh.
Andhra Pradesh Penalty for use of 18,688 2001-2002 Sales Tax AppellateGeneral Sales G Form against material to 2004-2005 Tribunal, Vizag.Tax Act, 1956 purchases Andra Pradesh
Gujarat Sales Differential Sales Tax for 62,087 1998-99 Sales Tax AppellateTax Act, 1969 non submission of to 1999-2000 Tribunal, Ahmedabad,
statutory forms. Gujarat.
Haryana Local Entry Tax Demand 3,995 2003-04 High Court, Punjab &Area Development Haryana.Tax Act, 2000
Kerala General Differential Sales Tax for 3,645 1998-99 & Dy. Commissioner, SalesSales Tax Act, disallowance of deduction 1999-2000 Tax (Appeals), Kochi,1963 on purchases u/s 3 of the Kerala
CST Act, 1956.
MP Entry Tax Entry Tax Demand. 588 2003-04 High Court, Jabalpur,Act, 1976 Chattisgarh
Central Sales Penalty against Form C 2,593 1998-99 UP Sales Tax Tribunal,Tax Act, 1956 usage for purchase of Agra, Uttar Pradesh
machinery.
Delhi Sales Tax Sales Tax Demand on 17,671 2000-01 to Additional Commissioner,Act, 1975 internet services. 2002-03 (Appeals), Delhi.
excise duty, cess and other undisputed statutorydues were outstanding, at the year end, for a periodof more than six months from the date they becamepayable.
(c) According to the records of the Company, the duesoutstanding of income tax, sales-tax, wealth tax,service tax, custom duty, excise duty and cess onaccount of any dispute, are as follows:
(x) The Company has no accumulated losses at the end ofthe financial year and it has not incurred cash losses inthe current and immediately preceding financial year.
(xi) Based on our audit procedures and as per theinformation and explanations given by the management,we are of the opinion that the Company has not defaultedin repayment of dues to a financial institution, bank ordebenture holders.
(xii) According to the information and explanations given tous and based on the documents and records producedto us, the Company has not granted loans and advanceson the basis of security by way of pledge of shares,debentures and other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi/ mutual benefit fund / society. Therefore, the provisionsof clause 4(xiii) of the Companies (Auditor’s Report)
Order, 2003 (as amended) are not applicable to theCompany.
(xiv) In respect of dealing/trading in shares, securities,debentures and other investments, in our opinion andaccording to the information and explanations given tous, proper records have been maintained of thetransactions and contracts and timely entries have beenmade therein. The shares, securities, debentures andother investments have been held by the Company, inits own name.
(xv) According to the information and explanations given tous, the Company has given guarantees for loans takenby subsidiaries/ joint ventures from banks or financialinstitutions, the terms and conditions whereof in ouropinion are not prima-facie prejudicial to the interest ofthe Company.
| 60 |
(xvi) Based on information and explanations given to us bythe management, term loans were applied for thepurpose for which the loans were obtained.
(xvii) According to the information and explanations given tous and on an overall examination of the balance sheetof the Company, we report that no funds raised on short-term basis have been used for long-term investment.
(xviii) The Company has not made any preferential allotmentof shares to parties or companies covered in the registermaintained under section 301 of the Companies Act,1956.
(xix) The Company did not have any outstanding debenturesduring the year.
(xx) We have verified that the end use of money raised bypublic issues is as disclosed in the notes to the financialstatements.
(xxi) Based upon the audit procedures performed for thepurpose of reporting the true and fair view of the financial
statements as per the information and explanations givenby the management, which have been relied upon byus, we report that no fraud on or by the Company hasbeen noticed or reported during the course of our audit,except that few employees of the Company hadmisappropriated funds amounting to Rs. 3,150 thousandduring the earlier years. The Company has investigatedthe matter and consequently dismissed the employeesand recovered the amounts there from.
S. R. BATLIBOI & CO.Chartered Accountants
per RAJ AGRAWALPartnerMembership No.: 82028
Place: GurgaonDate : May 31, 2007
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 61 |
(Amount in INR ’000)
Schedules As at As atMarch 31, 2007 March 31, 2006
SOURCES OF FUNDSShareholders’ Funds
Share Capital A 522,521 522,198Reserves and Surplus B 10,519,670 10,113,488
11,042,191 10,635,686Loan Funds C
Secured Loans 9,431,416 3,475,303Unsecured Loans 5,754,983 629,355
15,186,399 4,104,658Deferred Tax Liabilities (Net) 605,958 558,192(Refer Note 21 in Schedule ‘N’)TOTAL 26,834,548 15,298,536APPLICATION OF FUNDSFIXED ASSETS D
Gross Block 12,217,009 7,638,790Less : Accumulated Depreciation/Amortisation 3,704,797 3,023,817Net Block 8,512,212 4,614,973
Capital Work In Progress Including CapitalAdvances 40,336 771,792Preoperative Expenditure (Pending Allocation) E – 47,847
8,552,548 5,434,612
Investments F 3,177,973 1,244,085Current Assets, Loans and Advances G
Inventories 9,782,357 6,261,853Sundry Debtors 5,615,052 3,704,543Cash and Bank Balances 3,379,007 747,952Other Current Assets 510,129 190,195Loans and Advances 6,163,963 1,951,436
(A) 25,450,508 12,855,979Less: Current Liabilities and Provisions H
Current Liabilities 10,049,085 4,030,117Provisions 297,396 206,023
(B) 10,346,481 4,236,140
Net Current Assets (A-B) 15,104,027 8,619,839
TOTAL 26,834,548 15,298,536
Significant Accounting Policies & Notesto Accounts N
The Schedules referred to above and Notes to accounts form an integral part of the Balance Sheet
BALANCE SHEET AS AT MARCH 31, 2007
As per our report of even date For and on behalf of the Board of Directors of
S. R. BATLIBOI & CO. PUNJ LLOYD LIMITEDChartered Accountantsper Raj Agrawal V.K. Kaushik Atul PunjPartner Managing Director ChairmanMembership No. 82028
Dinesh Thairani Raju Kaul Ravi KeswaniPlace : Gurgaon Company Secretary Executive ExecutiveDate : May 31, 2007 Vice President Vice President
| 62 |
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31, 2007(Amount in INR ’000)
Schedules Year ended Year endedMarch 31, 2007 March 31, 2006
INCOMESales & Contracts Revenue I 22,388,471 13,682,149Other Income J 666,307 348,213TOTAL 23,054,778 14,030,362EXPENDITUREMaterials Consumed and Cost of Goods Sold K 5,904,187 4,526,242Operating and Administrative Expenses L 14,331,492 7,755,995Financial Expenses M 1,001,163 593,306Depreciation/Amortization (Including 872,232 621,597Amortization of Goodwill Rs. 149,795 thousand(Previous Year Rs. 149,795 thousand)).Less : Transfer from Revaluation Reserve 27,627 29,697
844,605 591,900TOTAL 22,081,447 13,467,443
Profit Before Tax 973,331 562,919Provision For TaxCurrent Tax 267,503 207,968Deferred Tax Charge/(Credit) (Including 49,136 (10,869)Rs. 6,157 thousand (Previous Year Creditof Rs. 34,506 thousand) of earlier years).Fringe Benefit Tax 40,846 14,350
Total Tax Expense 357,485 211,449Profit After Tax 615,846 351,470Balance Brought Forward from Previous Year 1,894,736 1,618,190Transfer from Debenture Redemption Reserve – 12,120Transfer from Foreign Project Utilised Reserve 22,500 12,500Profit Available for Appropriation 2,533,082 1,994,280APPROPRIATIONSTransfer to General Reserve 75,000 40,000Proposed Dividend 78,378 52,220Tax on Proposed Dividend 13,320 7,324
166,698 99,544SURPLUS CARRIED TO BALANCE SHEET 2,366,384 1,894,736Earning Per Share (Nominal Value Per Share Rs. 2 each)Basic (In Rupees) 2.36 1.62Diluted (In Rupees) 2.19 1.53Significant Accounting Policies & Notesto Accounts N
The Schedules referred to above and Notes to accounts form an integral part of the Profit and Loss Account
As per our report of even date For and on behalf of the Board of Directors of
S. R. BATLIBOI & CO. PUNJ LLOYD LIMITEDChartered Accountantsper Raj Agrawal V.K. Kaushik Atul PunjPartner Managing Director ChairmanMembership No. 82028
Dinesh Thairani Raju Kaul Ravi KeswaniPlace : Gurgaon Company Secretary Executive ExecutiveDate : May 31, 2007 Vice President Vice President
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 63 |
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE A : SHARE CAPITALAUTHORISED350,000,000 equity shares of Rs. 2 each (Previousyear 60,000,000 equity shares of Rs. 10 each) 700,000 600,00010,000,000 (Previous year 20,000,000) PreferenceShares of Rs. 10 each 100,000 200,000
800,000 800,000ISSUED, SUBSCRIBED AND PAID UP261,260,335 fully paid up equity shares of Rs. 2 each(Previous year 52,219,836 Equity Shares of Rs. 10 each) 522,521 522,198OF THE ABOVEi) 136,700 equity shares of Rs. 10 each were allotted as
fully paid up pursuant to a contract for considerationother than cash.
ii) 28,615,239 equity shares of Rs. 10 each were allottedas fully paid up bonus shares by capitalisation of profits.
iii) During the previous year, the Company had converted917,928 zero percent convertible preference sharesof Rs. 10 each into 3,098,296 equity shares of Rs. 10each.
iv) The Company has sub-divided nominal value of its equityshares from Rs. 10 each to Rs. 2 each on March 6, 2007.Consequently, the number of authorised equity shareshave increased from 70,000,000 to 350,000,000 and theissued, subscribed and paid up equity shares haveincreased from 52,252,067 to 261,260,335.
Note : (Refer Note 23 of Schedule ‘N’)
TOTAL 522,521 522,198
SCHEDULE B : RESERVES AND SURPLUSCapital Reserve 2,138 2,138Securities Premium AccountBalance as per last Account 7,977,340 2,539,174Additions during the year 19,983 5,765,070
7,997,323 8,304,244Less: Utilisation during the yearConversion of Preference Shares – 21,807Share Issue Expenses – 305,097Issue of Zero Coupon Foreign Currency Convertible Bonds 98,149 –
7,899,174 7,977,340Asset Revaluation ReserveBalance as per last Account 85,349 122,529Less: Adjustment on Account of Depreciation on Revalued
Amount of Assets 27,627 29,697Less: Adjustment on Account of Sale/Disposal of
Revalued Assets – 7,48357,722 85,349
| 64 |
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE B : RESERVES AND SURPLUS (CONTINUED)General ReserveBalance as per last Account 61,108 185,600Add: Transfer from Profit and Loss Account 75,000 40,000
136,108 225,600Less: Utilised during the year (Previous year – 164,492for issue of Bonus Shares)
136,108 61,108Foreign Project Utilised ReserveBalance as per last Account 92,500 105,000
Less: Transfer to Profit and Loss Account 22,500 12,50070,000 92,500
Debenture Redemption ReserveBalance as per last Account – 12,120Less: Transfer to Profit and Loss Account – – 12,120 –Foreign Currency Translation ReserveBalance as per last Account 317 (5,519)Add : Exchange difference during the year onNet Investment in Non-integral Operation (12,173) (11,856) 5,836 317Profit and Loss Account Balance 2,366,384 1,894,736
TOTAL 10,519,670 10,113,488
SCHEDULE C : LOAN FUNDSSECURED LOANS:A) SHORT TERM WORKING CAPITAL LOANSI. FROM BANKS 4,229,709 1,673,534Out of the above,i) Rs. 124,546 thousand (Previous year Rs. 488,770 thousand)
is secured by way of first charge on pari passu basis oncurrent assets (excluding receivables) and second chargeon pari passu basis on movable fixed assets of the projectdivision of the Company and further secured by personalguarantee of Chairman of the Company.
ii) Rs. 975,037 thousand (Previous year Rs. 17,353 thousand)is secured by way of first charge on pari passu basis oncurrent assets (excluding receivables) and second chargeon pari passu basis on movable fixed assets of the projectdivision of the Company.
iii) Rs. 562,217 thousand (Previous year Rs. 1,167,411thousand) is secured by way of exclusive charge on thereceivables of the specific projects financed by the respectivebanks, first pari passu charge on the current assets of theproject division (excluding receivables) pari passu secondchange on the movamble fixed assets of the project divisionof the company and further secured by personal guaranteeof Chairman of the Company.
iv) Rs. 2,567,909 thousand (previous year Nil) is secured byway of exclusive charge on the receivables of the specificprojects financed by the respective banks, first pari passucharge on the current assets of the project division (excludingreceivables), pari passu second charge on the movable fixedAssets of the project division of the Company.
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 65 |
(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE C : LOAN FUNDS (CONTINUED)B) TERM LOANSI) FROM BANKS 4,380,237 1,435,951
Loans aggregating to Rs. 1,681,840 thousand (Previousyear Rs. 478,992 thousand) are repayable within one year.
Out of the above,i) Rs. 1,007,412 thousand (Previous year Rs. 546,620
thousand) is secured by way of exclusive charge on theequipment purchased out of the proceeds of loan.
ii) Rs. 1,737,974 thousand(Previous year Rs. 120,000thousand) is secured by way of first pari passu charge onmovable fixed assets of the project division of the Company.
iii) Rs. 476,480 thousand (Previous year Rs. 262,500thousand) is secured by way of first pari passu charge onmovable fixed assets of the project division of the Companyand further secured by personal guarantee of Chairmanof the Company.
iv) Rs. 263,994 thousand (Previous year Rs. 235,648thousand) is secured by way of exclusive charge/mortgageby way of deposit of title deeds on the land and building forcorporate office at Gurgaon.
v) Rs. 500,000 thousand (Previous year Rs. Nil) is securedby way of subservient charge on the entire current andmovable fixed assets of the project division of the Company.
vi) Rs. 64,602 thousand (Previous year Rs. 171,192 thousand)is secured by way of paripassu first charge on the movablefixed assets of the project division of the Company,paripassu second charge on current assets of the projectdivision of the Company (excluding receivables of thecompany) and further secured by personal guarantee ofChairman of the Company.
vii) Rs. 249,840 thousand (Previous year Rs. Nil) is secured byway of pari passu first charge on the movable fixed assetsof the project division of the Company and pari passu secondcharge on current assets of the project division of theCompany (excluding receivables of the company)
viii) Rs. 79,935 thousand (Previous year Rs. 99,991 thousand)is secured by way of second pari passu charge on themovable fixed assets of the project division of the Companyand further secured by personal guarantee of Chairmanof the Company.
II) FROM OTHERS 593,638 43,961
Loans aggregating to Rs. 106,065 thousand (Previous yearRs. 27,123 thousand) are repayable within one year.
Out of the above,
i) Rs. 593,638 thousand (previous year Rs. 43,961thousand) is secured by first and exclusive charge byway of hypothecation on certain specific equipmentsfinanced through the loan.
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
| 66 |
(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE C : LOAN FUNDS (CONTINUED)III) HIRE PURCHASE LOANS
- FROM OTHERS 213,241 291,842
Loans aggregating to Rs. 59,098 thousand (Previous yearRs. 78,811 thousand) are repayable within one year.
(Secured by exclusive charge by way of hypothecation oncertain specific equipments.)
IV) EXTERNAL COMMERCIAL BORROWINGS
- FROM BANK 14,591 30,015
Loans aggregating to Rs. 14,591 thousand (Previous yearRs. 15,007 thousand) are repayable within one year.
(Secured by exclusive charge on the equipment financedthrough the loan.)
TOTAL 9,431,416 3,475,303
UNSECURED LOANS:
i) SHORT TERM WORKING CAPITAL LOANS
FROM BANKS 78,388 190,506
ii) TERM LOANS
FROM A BANK 240,000 404,046Loans aggregating to Rs. 240,000 thousand(Previous year Rs. 400,000 thousand) are repayablewithin one year.
iii) FROM SUBSIDIARY COMPANY – 8,500Loans aggregating to Rs. Nil (Previous year Rs.8,500thousand) are repayable within one year.
iv) ZERO COUPON FOREIGN CURRENCYCONVERTIBLE BONDS 5,422,500 –(Refer Note 26 in Schedule ‘N’)
v) INTER CORPORATE DEPOSITS 100 100Amounts aggregating to Rs. 100 thousand(Previous year Rs 100 thousand) are repayablewithin one year.
vi) EXTERNAL COMMERCIAL BORROWINGS
FROM BANK 13,995 26,203Loans aggregating to Rs.13,995 thousand(Previous year Rs. 13,101 thousand) are repayablewithin one year.
Commercial paper - Face Value Rs. Nil (Previous year Rs. Nil)
[Maximum amount outstanding at any time during the year
Rs. 150,000 thousand (Previous year Rs. Nil)]
TOTAL 5,754,983 629,355
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 67 |
(Am
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| 68 |
(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE E : PREOPERATIVE EXPENDITURE(PENDING ALLOCATION)Opening Balance 47,847 18,645Add: Expenditure Incurred during the yearDiesel and Fuel 209 8Repair and Maintenance - Others 1,303 4Hire Charges 77 41Salaries, Wages And Bonus 1,918 4,145Contribution to Provident & Other Funds – 7Workmen and Staff Welfare 165 93Rent 9 –Insurance 1,006 1,474Travelling and Conveyance 68 7Fees & Taxes 571 63Consultancy/Professional Charges 1,463 38Interest on Term Loan 4,856 19,402Bank /Financial Charges 11,737 1,302Others 237 2,618
23,619 29,20271,466 47,847
Less: Allocated to Fixed Assets 71,466 –Balance Carried Forward – 47,847
SCHEDULE F : INVESTMENTSLong TermI - SUBSIDIARY COMPANIESA) UNQUOTEDPUNJ LLOYD INC. – 8,493NIL (Previous year 200,000) equity shares of USD 1 each.PUNJ LLOYD INTERNATIONAL LIMITED 4,452 4,452100,000 (Previous year 100,000) equity shares of USD 1 each.
SPECTRA INFRASTRUCTURES LIMITED 115,002 115,00211,500,200 (Previous year 11,500,200) equity shares ofRs. 10 each.KAEFR PUNJ LLOYD LIMITED (formerly known as Punj LloydInsulations Limited) – 2,552NIL (Previous year 25,520) equity shares of Rs. 100 each.
SPECTRA NET LIMITED 17,061 17,0611,706,102 (Previous year 1,706,102) equity shares of Rs. 10 each.
ATNA INVESTMENTS LIMITED 39,922 39,922399,221 (Previous year 399,221) equity shares of Rs. 100 each.
PUNJ LLOYD KAZAKHSTAN - LLP 362,798 362,798KZT 1,107,977,200 (Previous year KZT 1,107,977,200) being100% of the amount of Charter Capital.
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 69 |
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
(Amount in INR ‘000)As at As at
March 31, 2007 March 31, 2006SCHEDULE F : INVESTMENTS (CONTINUED)
PUNJ LLOYD (MALAYSIA) SDN,BHD – 44,141
NIL (Previous year 3,661,255) equity shares of 1.00 RM. each.
PLN CONSTRUCTIONS LIMITED 30,896 30,896
2,000,000 (Previous year 2,000,000) equity shares of Rs. 10 each.
PUNJ LLOYD PTE LTD, SINGAPORE 673,799 –
230,000 (Previous year Nil) equity shares of SGD 100 each and
1 (Previous year Nil) equity share of SGD 1 each.
SPECTRA PUNJAB LIMITED 8,000 8,000
900,000 (Previous year 900,000) equity shares of Rs. 10 each.
SIMON CARVES INDIA LTD. 20,000 –
2,000,000 (Previous year Nil) equity shares of Rs. 10 each.
PT PUNJ LLOYD INDONESIA 170,900 170,900
7,805 (Previous year 7,805) equity shares of USD 500 each. 1,442,830 804,217
B) QUOTED
SPECTRA PUNJ LLOYD LIMITED 48,675 48,675
4,867,500 (Previous year 4,867,500) equity shares of Rs. 10 each.
II - TRADE
UNQUOTED
RAJAHMUNDRY EXPRESSWAY LIMITED 36,975 36,975
3,697,500 (Previous year 3,697,500) equity shares of Rs. 10 each.Of the above,1,885,000 shares (Previous year 1,885,000) arepledged with bank.
ANDHRA EXPRESSWAY LIMITED 36,975 36,975
3,697,500 (Previous year 3,697,500) equity shares of Rs. 10 each.Of the above, 1,885,000 shares (Previous year 1,885,000) arepledged with bank.
NORTH KARNATAKA EXPRESSWAY LIMITED 75,724 75,724
7,572,400 (Previous year 7,572,400) equity shares of Rs. 10 each.
THIRUVANANTHAPURAM ROAD DEVELOPMENT
COMPANY LIMITED 130,250 250
13,025,000 (Previous year 25,000) equity shares of Rs. 10 each.279,924 149,924
III - NON-TRADE
A) UNQUOTED
BISTRO HOSPITALITY (P) LIMITED – 28,782
Nil (Previous year 2,878,200) equity shares of Rs. 10 each.
RFB LATEX LIMITED 5,200 5,200
200,000 (Previous year 200,000) equity shares of Rs. 10 each.
AROOSHI ENTERPRISES (P) LIMITED 5,985 5,985
598,500 (Previous year 598,500) equity shares of Rs. 10 each.
| 70 |
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
(Amount in INR ‘000)As at As at
March 31, 2007 March 31, 2006SCHEDULE F : INVESTMENTS (CONTINUED)
GLOBAL HEALTH PRIVATE LIMITED 1,380,000 200,000
8,000,000 (Previous year 8,000,000) equity shares of Rs.10 each.
(Fully paid up (Previous year Rs. 1.45 paid up)).
DAYIM PUNJ LLOYD CONSTRUCTION CONTRACTINGCOMPANY LIMITED 11,795 –
49,000 (Previous year Nil) equity shares of SAR 20 each.
KAEFR PUNJ LLOYD LIMITED (formerly known as Punj LloydInsulations Limited) 2,552 –
25,520 (Previous year Nil) equity shares of Rs. 100 each.
SWISSPORT PUNJ LLOYD INDIA LIMITED 49 –
4,900 (Previous year Nil) equity shares of Rs. 10 each.
1,405,581 239,967
B) QUOTED
BERGER PAINTS LIMITED 963 2,888
61,600 (previous year 115,500) equity shares of Rs. 2 each. 963 2,888
(Including 23,100 shares of Rs. 2 each received by way of
Bonus Shares). 3,177,973 1,245,671
Less : Diminution in the value of Investments – 1,586
TOTAL 3,177,973 1,244,085
a) Aggregate Cost of Quoted Investments 49,638 51,563
b) Aggregate Cost of Unquoted Investments (Net of provisions) 3,128,335 1,192,522
c) Aggregate market value of Quoted investments 50,930 58,544
(In the absence of recent market Quotation of Spectra
Punj Lloyd Limited, latest quotation has been considered
for market value)
d) (Refer Note 18 of Schedule ‘N’)
SCHEDULE G : CURRENT ASSETS, LOANS AND ADVANCES
A. CURRENT ASSETS
i) INVENTORIES:
Stores and Spares 848,225 548,512
Scrap 4,479 27,149
Stock in Trade (Equipments) 3,249 3,521
Work in Progress- Projects 8,926,404 5,682,671
9,782,357 6,261,853
ii) SUNDRY DEBTORS: (Unsecured)*
Debts Outstanding for a period Exceeding Six Months
Unsecured Considered Good 2,127,140 1,487,175
(Includes retention money Rs.180,320 thousand
(Previous year Rs. 207,371 thousand))
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 71 |
(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE G : CURRENT ASSETS, LOANS AND ADVANCES(CONTINUED)Other DebtsUnsecured Considered Good 3,487,912 2,217,368(Includes retention money Rs. 276,061 thousand (Previous yearRs. 26,100 thousand))* (Includes Rs. 14,315 thousand (Previous year Rs. 26,040thousand) due from subsidiaries) 5,615,052 3,704,543iii) CASH AND BANK BALANCES
A) Cash on Hand 29,514 16,160B) Balances with Scheduled Banks
- On Current Accounts 285,698 102,777- On Cash Credit Accounts 166,092 15,193- On EEFC Accounts 374,023 2,100- On Fixed Deposits 2,036,905 14,885
(Receipts pledged with banks for Rs. 15,123 thousandagainst guarantees (Previous year Rs. 14,885 thousand))Included in Cash on hand are:Cheque on hand Rs. 7,500 thousand (Previous yearRs. 5,024 thousand)Foreign currency Rs. 77 thousand (previous year Rs. Nil)c) Balances with Non-scheduled Banks
(Refer Note 9 of Schedule ‘N’)- On Current Accounts 297,642 583,157- On Fixed Deposits 189,133 13,680(Receipts pledged with banks Rs. 23,117 thousandagainst guarantees (Previous year Rs. 13,680thousand)) 3,379,007 747,952
iv) Other Current AssetsUnsecured Considered Gooda) Interest Receivable 42,188 119,993b) Insurance Claims Receivable 76,035 19,102c) Export Benefits Receivable 387,681 46,875d) Receivables against Sale of 4,225 4,225
Investments (Refer Note 14 of Schedule ‘N’)Unsecured Considered Doubtfule) Interest Receivable 80,292 –
590,421 190,195Less: Provision for Doubtful Receivable 80,292 –
510,129 190,195B) LOANS AND ADVANCES: (Unsecured, Considered Good)
a) Loans to Employees * 1,600 1,908b) Loan to A Subsidiaries 307,998 323,349c) Inter Corporate Deposits 4,500 14,500d) Advances Recoverable in cash or in kind or for 1,194,758 671,660
value to be receivede) Due from Subsidiaries 619,209 54,605f) Advances for Proposed Investments 2,831,807 130,001
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
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(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE G : CURRENT ASSETS, LOANS AND ADVANCES(CONTINUED)
g) Deposits 129,743 69,738h) Balance with Custom/Excise Department 318,136 61,981i) Advance Income Tax/Tax Recoverable
(Net of Provisions) 497,154 422,127j) Vat/Sales Tax Receivable 259,058 201,567
6,163,963 1,951,436TOTAL 25,450,508 12,855,979* Included in loans to employees are:Due from an officer of the Company 285 350Maximum amount outstanding during the year 350 410
SCHEDULE H : CURRENT LIABILITIES AND PROVISIONS(A) CURRENT LIABILITIES
Acceptances 157,044 365,052Sundry Creditors 3,502,469 2,251,118(Refer Note 19 of Schedule ‘N’)Due to Subsidiaries 57,786 101,919Advance Billings 391,341 210,033Unearned Income 48,466 47,223Security Deposits 113,681 112,126Advances from Clients 4,962,453 843,453Interest accrued but not due on loans 17,120 5,593Others 798,725 93,600
10,049,085 4,030,117(B) PROVISIONS
For Tax (Net of Taxes Paid) 133,445 95,694For Fringe Benefit Tax (Net of Taxes Paid) 10,876 4,350For Gratuity 10,581 18,803For Leave Encashment 50,796 27,632For Proposed Dividend (Including Tax on Dividend) 91,698 59,544
297,396 206,023TOTAL 10,346,481 4,236,140
SCHEDULE I : SALES & CONTRACTS REVENUEContracts Revenue (Including Export Benefits Rs. 417,295thousand (Previous year Rs. 165,502 Thousand)) 21,809,845 13,283,724Income from Hire Charges 167,149 46,169Management Services 11,828 47,318Sales (Net of Discounts)- Exports 4,380 543- Others 4,967 3,823
9,347 4,366Internet Services (Net of Discounts Rs. 541,104 thousand 390,302 300,572
(Previous year Rs.592,104 thousand)).
TOTAL 22,388,471 13,682,149
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 73 |
(Amount in INR ’000)Year ended Year ended
March 31, 2007 March 31, 2006SCHEDULE J : OTHER INCOMERent (Gross, Tax Deducted at Source Rs. 403 thousand(Previous year Rs. 478 thousand)) 4,848 2,128Interest (Gross, Tax Deducted at Source Rs. 236 thousand(Previous year Rs. 1,938 thousand)) 182,297 54,461Dividend on Long Term Investments 289 6,085Profit on Liquidation of Subsidiaries (Net) 13,956 –Insurance Claims 26,985 43,301Profit on Sale of Non Trade Long Term Investments 25,358 47,758Profit on Sale of Fixed Assets 23,010 11,115Profit on Sale of Stores and Spares – 6,048Unspent Liabilities and Provisions Written Back 49,915 92,474Bad Debts Recovered 11,809 –Foreign Exchange Fluctuation (Net) 253,817 36,545Miscellaneous Income 74,023 48,298
TOTAL 666,307 348,213
SCHEDULE K : MATERIALS CONSUMED ANDCOST OF GOODS SOLDMaterial Consumed 5,873,552 4,500,641Cost Of Goods Sold-equipmentsOpening Stock 3,521 4,123Add: Purchases 4,695 1,709
8,216 5,832Less: Closing Stock 3,249 3,521
4,967 2,311Amortisation / Depletion In The Value Of Inventory 25,668 23,290
TOTAL 5,904,187 4,526,242
SCHEDULE L : OPERATING AND ADMINISTRATIVE EXPENSESOperatingContractor Charges 4,972,087 2,978,267Site/Connectivity Expenses 748,116 422,866Diesel and Fuel 1,271,219 523,998Repair and Maintenance– buildings 12,129 9,087– Plant and Machinery 33,345 31,878– Others 41,680 34,638Freight & Cartage 645,234 363,545Hire Charges 1,081,416 666,602
8,805,226 5,030,881PersonnelSalaries, Wages and Bonus 2,099,837 1,202,523Contribution to Provident & Other Funds 84,065 77,976Gratuity 9,273 1,136Workmen and Staff Welfare 172,458 104,623
2,365,633 1,386,258
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
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(Amount in INR ’000)Year ended Year ended
March 31, 2007 March 31, 2006
SCHEDULE L : OPERATING AND ADMINISTRATIVE EXPENSES(CONTINUED)Administration and EstablishmentBad Debts/Advances Written Off 18,079 59,829Less: Provision made in previous year, now reversed – 8,300
18,079 51,529Rent 115,204 89,605
Insurance 554,857 183,963
Directors’ Sitting Fee 180 190
Travelling and Conveyance 424,279 191,628
Fee & Taxes 734,579 179,492
Consultancy/Professional Charges 871,480 400,847
Commission on Internet Services 7,476 10,487
Provision for Doubtful Receivable 80,292 –
Diminution In Value of Long Term Investments – 210
Loss on Sale of Short Term Investments – 19
Donations 24,286 14,144
Auditors’ Remuneration (Including to Branch Auditors)
– Audit Fee 11,136 6,657
– Audit Fee for Consolidated Financial Statements 1,684 2,381
– Fee For Limited Review 3,613 –
– Other Services 990 2,792
– Out of Pocket Expenses 207 185
Others 312,291 204,7273,160,633 1,338,856
TOTAL 14,331,492 7,755,995
SCHEDULE M : FINANCIAL CHARGES
Interest on:
Term Loans 292,467 295,491
Debentures - 789
Others 399,954 171,713
692,421 467,993
Bank/Financial Charges 308,742 125,313
(Including prepayments Rs. Nil (Previous year
Rs. 1,899 thousand))
TOTAL 1,001,163 593,306
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 75 |
SCHEDULE N : SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO ACCOUNTS
1. Nature of operations
Punj Lloyd Limited is a Company registered under Indian Companies Act, 1956. The Company is primarily engaged in thebusiness of engineering & construction in the oil & gas sector and infrastructure sector. The Company’s focus on customersatisfaction through compliance with the high standards of health, safety and environment, makes it a leading player in themarkets in which it operates. The Company also provides broadband services on its optical fiber network.
The Company has acquired 100% stake in Sembawang Engineering & Constructors Pte Ltd (Formerly known as SembcorpEngineers & Constructors Pte Ltd) alongwith its subsidiaries (including Simon Carves Ltd, United Kingdom), joint venturesand associates through its wholly owned subsidiary Punj Lloyd Pte Ltd, Singapore. The acquisition would enable theCompany to acquire prequalification in new verticals of infrastructure sectors and EPC capabilities in Petrochemical domainincluding LDPE, PVC, Styrene and Refinery Process. The acquisition would cement the Company’s presence in South EastAsia and Middle East and would give access to new region in Europe.
2. Statement of significant accounting policies
(a) Basis of preparation
The financial statements have been prepared to comply in all material respects with the mandatory AccountingStandards issued by the Institute of Chartered Accountants of India (ICAI) and the relevant provisions of the CompaniesAct, 1956. The financial statements have been prepared under the historical cost convention on an accrual basisexcept in case of certain fixed assets for which revaluation has been carried out. The accounting policies have beenconsistently applied by the Company and are consistent with those used in previous year.
(b) Use of estimates
The preparation of financial statements in conformity with generally accepted accounting principles requiresmanagement to make estimates and assumptions that affect the reported amounts of assets and liabilities and thedisclosure of contingent liabilities as at the date of the financial statements and reported amounts of revenues andexpenses during the reporting period. Actual results could differ from these estimates.
(c) Fixed assets
Fixed assets are stated at cost, (other than some fixed assets which are stated at values as determined by the valuer),less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributablecost of bringing the asset to its working condition for its intended use. Borrowing costs attributable to acquisition/construction of fixed assets are capitalized as per the policy stated in note (f) below.
(d) Impairment
The carrying amounts of fixed assets are reviewed at each Balance Sheet date if there is any indication of impairmentbased on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceedsits recoverable amount. The recoverable amount is the greater of the asset’s net selling price and value in use. Inassessing the value in use, the estimated future cash flows are discounted to their present value at the weightedaverage cost of capital.
(e) Depreciation/Amortization
i) Depreciation on the fixed assets is charged on straight line method, at the rates prescribed under Schedule XIVto the Companies Act, 1956, (except to the extent stated in paras (ii), (iii), (iv) and (viii) below), which are basedon the useful lives of the assets. In respect of the revalued assets, the difference between the depreciationcalculated on the revalued amount and that calculated on the original cost is recouped from the RevaluationReserve Account.
ii) Depreciation on the following fixed assets of the project division is charged on straight line method at the rates,based on useful lives of the assets, as follows which are higher than the rates prescribed under Schedule XIV tothe Companies Act, 1956:
Asset Description Depreciation Rate
Plant and machinery 4.75% to 11.31%
Vehicles 9.5% to 20%
iii) Depreciation on the following fixed assets of Internet Service Division is charged on straight line method at therates, based on useful lives of the assets as estimated by the management, which are equal to or higher than therates prescribed under Schedule XIV to the Companies Act, 1956.
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Asset Description Depreciation Rate
Plant and machinery 10%
Networking equipment* 10%
Office equipment 10%
Vehicles 9.5% to 20%
Ducts and optical fiber cables* 4.75%
* Included under Plant & Machinery.
iv) Depreciation on the following fixed assets of some foreign branches is charged on straight line method at therates, based on useful lives of the assets as follows, which are higher than the rates prescribed under ScheduleXIV to the Companies Act, 1956:
Asset Description Useful Lives of Assets
Plant and machinery 6 to 25 years
Furniture and fixtures 3 to 21 years
Office Equipments 5 to 6 years
Vehicles 5 to 11 years
v) Amount added to assets on account of foreign exchange fluctuation is depreciated prospectively over the remaininguseful lives of the respective assets.
vi) No amortization is made for leasehold land, which is under perpetual lease.
vii) Individual assets costing up to Rs. 5,000 are depreciated fully in the month of purchase.
viii) Depreciation on Company’s share of fixed assets of an unincorporated joint venture is provided on straight linemethod at the following rates, based on their useful lives, as estimated by the management of the joint venture.
Asset Description Depreciation Rate
Buildings 10%
Plant and machinery 20%
Furniture, fixtures and office equipments 20%
Vehicles 20%
ix) Intangibles
(a) Goodwill arising on acquisition of the Internet Service Division is amortized using the straight line methodover a period of five accounting years.
(b) Different software used by the Company are amortized on a straight line basis based on the nature anduseful lives of these software as mentioned below:
(i) Software of project division are amortized over a period of six years.
(ii) Software of internet service division are amortized over a period of five years.
(iii) Software of an unincorporated joint venture are amortized over a period of three years.
(f) Borrowing Costs
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of thecost of such assets to the extent they relate to the period till such assets are ready to be put to use. A qualifying assetis one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs arecharged to Profit and Loss Account.
(g) Preoperative Expenditure pending allocation
Expenditure directly relating to construction activity is capitalized. Indirect expenditure incurred during constructionperiod is capitalized as part of indirect construction cost to the extent to which the expenditure is indirectly related to theconstruction or is incidental thereto. Other indirect expenditure (including borrowing cost) incurred during the constructionperiod, which is not related to the construction activity nor is incidental thereto, is charged to the Profit and Loss Account.
(h) Investments
Investments that are readily realizable and intended to be held for not more than a year are classified as currentinvestments. All other investments are classified as long-term investments. Current investments are carried at lower ofcost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However,provision for diminution in value is made to recognize a decline other than temporary in the value of such investments.
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 77 |
(i) Inventories
i) Stock in trade (Equipments), Stores and Spares are valued at lower of cost and net realizable value. However,materials and other items held for use in the production of inventories are not written down below cost if thefinished products in which they will be incorporated are expected to be sold at or above cost. Cost is determinedon weighted average basis.
ii) Work in progress related to projects is valued at net realizable value.
iii) Scrap is valued at net realizable value.
iv) Scaffoldings (included in Stores and Spares) are valued at cost less amortization/charge based on their usefullife, which is estimated at 10 years.
Net realizable value is the estimated selling price in the ordinary course of business less estimated costs to makethe sale, and estimated costs of completion.
(j) Revenue recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and therevenue can be reliably measured.
i) Revenue from long-term construction contracts is recognized on the percentage of completion method. Percentageof completion is determined as a proportion of cost incurred to date to the total estimated contract cost. However,profit is not recognized unless there is reasonable progress on the contract. In case the total cost of a contract,based on technical and other estimates, is expected to exceed the corresponding contract value, such expectedloss is provided for. The effect of any adjustment arising from revisions to estimates is included in the incomestatement of the year in which revisions are made. The revenue on account of extra claims and the expenditureon account of liquidated damages on construction contracts are accounted for at the time of acceptance/settlementby the customers due to uncertainties attached thereto. Similarly, insurance claims are accounted for on settlementwith insurers.
ii) Revenue from long-term construction contracts executed in joint ventures under work sharing arrangements isrecognized on the same basis as similar contracts independently executed by the Company. Revenue in jointventures under profit sharing arrangements is recognized to the extent of the Company’s share in joint ventures.
iii) Internet Service revenues comprise of revenues from registration, installation and provision of Internet services.Registration fee and installation charges are recognized on the admission of customer and completion of servicesrespectively. Service revenue from Internet access is recognized pro-rata, calculated on the basis of provision ofservices or time duration of contract, as may be applicable.
iv) Revenue from sale of equipment is recognized when the significant risks and rewards of ownership of the goodshave passed to the buyer.
v) Revenue from hire charges is accounted for in accordance with the terms of agreements with the customers.
vi) Interest revenue is accounted for on a time proportion basis taking into account the amount outstanding and therate applicable.
vii) Dividend revenue is recognized when the shareholder’s right to receive payment is established by the balancesheet date. Dividend from subsidiaries is recognized even if the same are declared after the Balance Sheet datebut pertains to period on or before the date of Balance Sheet as per the requirement of Schedule VI of theCompanies Act, 1956.
viii) Export Benefit under the Duty Free Credit Entitlements is accounted for in the year of export.
(k) Foreign currency translation
Foreign currency transactions
i) Initial Recognition
Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amountthe exchange rate between the reporting currency and the foreign currency at the date of the transaction.
ii) Conversion
Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried interms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of thetransaction.
iii) Exchange Differences
Exchange differences arising on the settlement of monetary items or on reporting Company’s monetary items at
| 78 |
rates different from those at which they were initially recorded during the year, or reported in previous financialstatements, are recognized as income or as expenses in the year in which they arise, except those arising frominvestments in non-integral foreign operations. Exchange differences on transactions relating to fixed assetsacquired from a country outside India are adjusted to the carrying amount of fixed assets.
Exchange differences arising on a monetary item that, in substance, forms part of Company’s net investment in anon-integral foreign operation are accumulated in a foreign currency translation reserve in the financial statementsuntil the disposal of the net investment, at which time they are recognized as income or as expenses.
iv) Translation of integral and non-integral foreign operation
The financial statements of an integral foreign operation are translated as if the transactions of the foreignoperation have been those of the Company itself.
In translating the financial statements of a non-integral foreign operation for incorporation in financial statements,the assets and liabilities, both monetary and non-monetary, of the non-integral foreign operation are translatedat the closing rate; income and expense items of the non-integral foreign operation are translated at exchangerates on the dates of the transactions. All resulting exchange differences are accumulated in a foreign currencytranslation reserve until the disposal of the net investment.
On the disposal of a non-integral foreign operation, the cumulative amount of the exchange differences whichhave been deferred and which relate to that operation are recognized as income or as expenses in the sameperiod in which the gain or loss on disposal is recognized.
(l) Retirement and other employee benefits
i) Retirement benefits in the form of provident fund and superannuation/pension schemes are charged to Profit andLoss Account of the year when the contributions to the respective funds are due. There are no other obligationsother than the contribution payable to the respective trusts.
ii) The Company has taken an insurance policy under group gratuity scheme with Life Insurance Corporation ofIndia/ICICI to cover the gratuity liability of the employees of project division and amount paid/payable in respectof present value of liability for past services is charged to Profit and Loss Account on the basis of actuarialvaluation at the end of the financial year. In respect of employees of ISP division, gratuity liability is accrued andprovided for on the basis of an actuarial valuation made at the end of each financial year.
iii) Liability for leave encashment is provided for on actuarial valuation done at the end of the financial year exceptin case of the overseas branches, where liability is provided on actual basis for leaves standing to the credit ofemployees.
(m) Income taxes
Tax expense comprises of current, deferred and fringe benefit tax. Current income tax and fringe benefit tax is measuredat the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act and in theoverseas branches as per the respective tax laws. Deferred income tax reflects the impact of current year timingdifferences between taxable income and accounting income for the year and reversal of timing differences of earlieryears.
Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the BalanceSheet date. Deferred tax assets and deferred tax liabilities across various countries of operation are not set off againsteach other as the Company does not have a legal right to do so. Deferred tax assets are recognized only to the extentthat there is reasonable certainty that sufficient future taxable income will be available against which such deferred taxassets can be realized. In situations where the Company has unabsorbed depreciation or carry forward tax losses, alldeferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can berealized against future taxable profits.
(n) Leases
Where the Company is the lessee
Finance Leases, which effectively transfer to the Company substantially all the risks and benefits incidental to ownershipof the leased item, are capitalized at the lower of the fair value and present value of the minimum lease payments at theinception of the lease term and disclosed as leased assets. Lease payments are apportioned between the financecharges and reduction of the lease liability based on the implicit rate of return. Finance charges are charged directlyagainst income. Lease management fees, legal charges and other initial direct costs are capitalized. If there is noreasonable certainty that the Company will obtain the ownership by the end of the lease term, capitalized leasedassets are depreciated over the shorter of the estimated useful life of the asset or the lease term.
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item are
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 79 |
classified as operating leases. Operating lease payments are recognized as an expense in the Profit and LossAccount on a straight line basis over the lease term.
Where the Company is the lessor
Assets subject to operating leases are included in fixed assets. Lease income is recognized in the Profit and LossAccount on a straightline basis over the lease term. Costs, including depreciation are recognized as expense in theProfit and Loss Account. Initial direct costs such as legal costs, brokerage costs, etc. are recognized immediately in theProfit and Loss Account.
(o) Accounting for joint ventures
Accounting for joint ventures undertaken by the Company has been done as follows:
Type of Joint Venture Accounting Treatment
Jointly Controlled Operations Company’s share of revenues, expenses, assets and liabilities are includedin the financial statements as Revenues, Expenses, Assets and Liabilitiesrespectively.
Jointly Controlled Entities Company’s investment in joint ventures is reflected as investment andaccounted for in accordance with para (h) above.
(p) Segment reporting policies
Identification of segments
The Company’s operating businesses are organized and managed separately according to the nature of products andservices provided, with each segment representing a strategic business unit that offers different products and servesdifferent markets. The analysis of geographical segments is based on the areas in which major operating divisions ofthe Company operate.
Unallocated items
General corporate income and expense items are not allocated to any business segment.
(q) Earnings per share
Basic earnings per share are calculated by dividing the net profit or loss for the year attributable to equity shareholdersby the weighted average number of equity shares outstanding during the year. Partly paid equity shares are treated asa fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equityshare during the reporting year. The weighted average number of equity shares outstanding during the reportedyears are adjusted for the events of bonus issue and share split.
For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equityshareholders and the weighted average number of shares outstanding during the year are adjusted for the effects ofall dilutive potential equity shares.
(r) Provisions
A provision is recognized when an enterprise has a present obligation as a result of past event and it is probable thatan outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made.Provisions are not discounted to its present value and are determined based on best estimate required to settle theobligation at the balance sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect thecurrent best estimates.
(s) Employee Stock Options
The Company accounts for stock compensation expenses, if any, arising on employee stock option based on the fairvalue method.
(t) Cash and Cash equivalents
Cash and cash equivalents in the Cash Flow Statement comprise cash at bank and in hand.
3. SEGMENT INFORMATION
Business Segments:
As of March 31, 2007, the Company organized its operations into two major businesses: Engineering & Construction andInternet Services. A description of the types of products and services provided by these segments is given in Note on Natureof Operations.
| 80 |
Further information about above segments is given below: Rs. in í000Engineering & Internet Services Corporate unallocable Totalconstruction expenses
2006-07 2005-06 2006-07 2005-06 2006-07 2005-06 2006-07 2005-06
External Segment Revenue 22,174,171 13,550,943 396,252 323,407 484,355 156,012 23,054,778 14,030,362
Less: Internal Segments – – – – – – – –
Segment Revenue 22,174,171 13,550,943 396,252 323,407 484,355 156,012 23,054,778 14,030,362
Segment Results 1,739,511 1,933,579 (20,539) (45,818) (745,641) (1,324,842) 973,331 562,919
Segment Assets 25,987,192 15,348,266 947,540 921,573 10,246,297 3,264,835 37,181,029 19,534,674
Segment Liabilities 8,968,092 3,659,622 169,380 128,527 17,001,366 5,110,841 26,138,838 8,898,990
Capital Expenditure 4,208,547 1,599,981 30,694 24,638 251,641 195,695 4,490,882 1,820,314
Depreciation/Amortisation 590,723 339,928 69,843 70,435 184,039 181,538 844,605 591,901
Non Cash Expenses – – – – – 210 – 210
Reconciliation of Reportable Segments with the Financial StatementsRevenues Results Assets Liabilities
2006-07 2005-06 2006-07 2005-06 2006-07 2005-06 2006-07 2005-06
Total of reportable segments 23,054,778 14,030,362 973,331 562,919 37,181,029 19,534,674 26,138,838 8,898,990
Less: Corporate –
unallocated Taxes – – (357,485) (211,449) – – – –
As per segment 23,054,778 14,030,362 615,846 351,470 37,181,029 19,534,674 26,138,838 8,898,990
As per Financial Statements 23,054,778 14,030,362 615,846 351,470 37,181,029 19,534,674 26,138,838 8,898,990
Geographical Segments*:
Although the Company’s major operating divisions are managed on a worldwide basis, they operate in two principal geographicalareas of the world, in India, its home country, and the other countries.
The following table presents revenue and debtors regarding geographical segments for the year ended March 31, 2007 andMarch 31, 2006.
Rs. in ‘000
Sales Revenue by Debtors (including retention money) byGeographical Market Geographical Market
2006-07 2005-06 2006-07 2005-06
India 16,862,057 9,673,404 4,017,511 2,599,134
Other countries 6,192,721 4,356,958 1,597,541 1,105,409
23,054,778 14,030,362 5,615,052 3,704,543
* The Company has common assets for servicing Domestic Market and Overseas Markets. Hence, separate figures for assets/additions to assets cannot be furnished.
4. Names of related parties
Subsidiary Companies Spectra Punj Lloyd LimitedKaefer Punj Lloyd Ltd. (Formerly known as Punj LloydInsulations Limited) (upto September 21, 2006)Punj Lloyd (Malaysia) SDN,BHD (upto April 24, 2005)Punj Lloyd Inc (upto December 31, 2005)Punj Lloyd International LimitedPunj Lloyd Kazakhstan LLPSpectra Infrastructure LimitedAtna Investments Limited
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 81 |
Spctra Net LimitedSpectra Punjab LimitedPT Punj Lloyd IndonesiaSpectra Net Holdings LimitedPLN Construction Ltd.Punj Lloyd Pte Ltd. (w.e.f June 02, 2006)Simon Carves India Ltd (w.e.f. December 13, 2006) *Sembawang Engineers and Constructors Pte. Ltd. @PT Sempec Indonesia @Sembawang Development Pte Ltd. @PT Synergy Technology Construction @PT Indo Precast Utama @PT Indo Unggul Wasturaya @Wuxi Sinlian Precast Manufacturing Co.Ltd. @SembCorp (Tianjin) Construction Engineering Co., Ltd. @Construction Technology Pte Ltd. @Contech Trading Pte Ltd. @PT Contech Bulan @Construction Technology (B) Sdn Bhd @SembCorp (Hebei) Building Materials Co. Ltd. @Sembawang Infrastructure (Mauritius) Ltd. @Sembawang Infrastructure (India) Pvt Ltd. @Sembawang-JTCI (China) Pte Ltd. @Sembawang Construction Pte Ltd. @SC Architects and Engineers Pte Ltd. @Sembawang (Malaysia) Sdn Bhd @Jurubina Sembawang (M) Sdn Bhd @Simon-Carves Limited @Sembawang Simon-Carves Limited De Mexico @Sembawang Engineers and Constructors Middle East FZE @
Joint Ventures Thiruvananthpuram Road Development Company LimitedPunj Lloyd - Limak JVPunj Lloyd - Progressive Construction JVPersys-Punj Lloyd JVPunj Lloyd-PT Punj Lloyd Indonesia JVAsia Drilling Services Limited (Joint Venture of Punj Lloyd International Ltd.)Punj Lloyd - Sunil Hi-tech Engineers JVKaefer Punj Lloyd Ltd. (Formerly known as Punj LloydInsulations Limited) (w.e.f. September 22, 2006)Swissport Punj Lloyd India Pvt Ltd. (w.e.f. December 01, 2006) *Dayim Punj Lloyd Construction Contracting Co. Ltd. (w.e.f. September 27, 2006)*Joint Venture of Whessoe Oil and Gas Limited and Punj Lloyd Ltd.(w.e.f May 19, 2006) *SYNA Petrochemical Engineering Company (Iran)@Total-CDC-DNC Joint Operation (Indonesia) @Kumagai-Sembawang-Mitsui Joint Venture (Singapore) @Kumagai-SembCorp Joint Venture (Singapore) @Philipp Holzmann-SembCorp Joint Venture (Singapore) @Kumagai-SembCorp Joint Venture (DTSS) (Singapore) @Semb-Corp Daewoo Joint Venture (Singapore) @Sime Engineering Sdn Bhd Sembawang Malaysia Sdn Bhd Joint Venture(Malaysia) @Sime Engineering Sdn Bhd SembCorp Malaysia Sdn Bhd Joint Venture(Malaysia) @
| 82 |
Associates Bistro Hospitality Private Limited (upto July 24, 2006)Gaitry Cable Network Private Limited (Associate of Spectra Net Limited)City Vision Pvt. Ltd.Shitul Engineering Pvt. Ltd.Sunstar Network & Technologies Pvt. Ltd.Dot Com Holdings Pvt. Ltd.Satellite Vision Pvt. Ltd.Reliance Contractors Private Limited @Ventura Development (Myanmar) Pte Ltd. @Ventura Development (Surabaya) Pte Ltd. @Realand Pte Ltd. @Reco Sin Han Pte Ltd. @
* These entities have been incorporated/formed during the year.@ These entities form part of the Sembawang Engineers & Constructors (SEC) Group, which has become a part of the Punj
Lloyd Group effective June 02, 2006 consequent to acquisition of 100% stake by Punj Lloyd Limited in Punj Lloyd PteLimited (a company incorporated in Singapore), which is the immediate holding company of SEC.
Key Managerial PersonnelAtul Punj ChairmanV.K. Kaushik Managing DirectorLuv Chhabra Director Corporate Affairs
Relatives of Key Managerial PersonnelS.N.P.Punj - Father of ChairmanArti Singh - Sister of ChairmanIndu Rani Punj – Mother of ChairmanUday Punj – Brother of ChairmanManglam Punj – Wife of brother of ChairmanShiv Punj – Son of ChairmanJai Punj – Son of brother of ChairmanDev Punj - Son of brother of ChairmanKumkum Kaushik – Wife of Managing Director
Enterprises over which relatives of Key Managerial Personnel are exercising significant influencePunj Business Centre – owned by father of ChairmanCollectible @ The Inside Story – Owned by Sister of ChairmanIndtech Construction Pvt. Ltd. – Shareholding of ChairmanSpectra Punj Finance Pvt. Ltd. – Shareholding of ChairmanCawdor Enterprises Ltd. – Shareholding of ChairmanUday Punj (HUF) – HUF of brother of ChairmanK.R. Securities (P.) Ltd. – Shareholding of Brother of ChairmanAtul Punj (HUF) – HUF of ChairmanVishwedeva Builders and Promoters Pvt. Ltd. – Shareholding of sister of ChairmanPTA Engineering and Manpower Services Pvt. Ltd. – Shareholding of ChairmanPLE Hydraulics Pvt. Ltd. - Shareholding of ChairmanSpecial Steel Forgings Pvt. Ltd. – Shareholding of Chairman
Indo Pacific Aviation Pvt. Ltd. – Shareholding of Chairman
Petro IT Pvt. Ltd. – Shareholding of Brother of Chairman
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 83 |
5. Interest in joint ventures:
The Company’s interest and share in joint ventures in the jointly controlled entities/operations are as follows:
a) List of joint ventures
S. Name of Joint Ventures Description of Nature of Project Ownership Country ofNo. Interest Interest Incorporation
or residence
1 Thiruvananthpuram Road Jointly Controlled Thiruvananthpuram 50% IndiaDevelopment Company Limited Entity City Improvement
2 Punj Lloyd-Progressive Jointly Controlled 6 Laning of Jaipur See Note (a) *Constructions JV Operations By-pass
3 Persys-Punj Lloyd JV Jointly Controlled Construction of Elevated See Note (a) *Operations Viaduct from Kirti Nagar to
Tilak Nagar, Delhi4 Punj Lloyd-PT Punj Lloyd Jointly Controlled 36"Uran-Trombay See Note (a) *
Indonesia JV Operations Jawahardweep oil pipe-line and 30" oil pipelinefrom Tee off at ShevaSouth to JNPT Project.
5 Punj Lloyd - Limak JV Jointly Controlled Construction of Baku 50% *Operations Tiblisi Ceyhan Crude
Oil Pipeline Project inTurkey
6 Punj Lloyd - Sunil Hi-tech Jointly Controlled Civil, Structural & See Note (a) * Engineers JV Operations Architectural Works for
1000 MW RaigarhThermal Power Plant
7 Kaefer Punj Lloyd Ltd. Jointly Controlled Insulation Work 49% India(Formerly known as Punj EntityLloyd Insulations Limited)
8 Swissport Punj Lloyd India Jointly Controlled Airport Development 49% IndiaPvt Ltd Entity
9 Dayim Punj Lloyd Constru- Jointly Controlled HDD Operations in India 49% Saudi Arabiaction Contracting Co. Ltd Entity
10 Whessoe Oil and Gas Limited Jointly Controlled Revival of Ratnagiri Gas 50% *- Punj Lloyd Limited JV Operation and Power Private Limited
LNG Terminal project11 Total-CDC-DNC Joint Jointly Controlled Construction of a hotel 40% *
Operation (Indonesia) ** Operations and golf course recreationcentre
12 Kumagai-Sembawang- Mitsui Jointly Controlled Design and construction of 45% *Joint Venture (Singapore) ** Operations the Potong Pasir and on
Keng MRT Stations (MRTContract 705), includingtunnels
13 Kumagai-SembCorp Jointly Controlled Design and construction 50% * Joint Venture (Singapore)** Operations the Changi Airport MRT
Station (MRT Contract504) including tunnels
14 Philipp Holzmann-SembCorp Jointly Controlled Design and construction 50% *Joint Venture (Singapore)** Operations of Kranji Deep Tunnel
Sewerage System(Contract T-05)
| 84 |
S. Name of Joint Ventures Description of Nature of Project Ownership Country ofNo. Interest Interest Incorporation
Or residence
15 Kumagai-SembCorp Jointly Controlled Design and construction of 50% *Joint Venture (DTSS) Operations Paya Lebar Deep Tunnel(Singapore)** Sewerage System
(Contract T-03)16 Semb-Corp Daewoo Jointly Controlled Design and construction of 60% *
Joint Venture (Singapore)** Operations Kallang and Paya LebarExpressway(Contract 422)
17 Sime Engineering Sdn Bhd Jointly Controlled Engineering, procurement 50% *Sembawang Malaysia Sdn Operations and construction worksBhd Joint Venture (Malaysia)**
18 Sime Engineering Sdn Bhd Jointly Controlled Mechanical and piping 50% *SembCorp Malaysia Sdn Bhd Operations erection worksJoint Venture (Malaysia)**
* Country of Incorporation not applicable, as these are Unincorporated Joint Ventures
** These jointly control entities/oprations form part of Sembawang Engineers and Constructors (SEC) Group, which has becamea part of Punj Lloyd Group effective June 02, 2006, consequent to acquition of 100% stake by Punj Lloyd Limited in Punj LloydPte Limited (a Company incorporated in Singapore), which is the immediate holding company of SEC.
Note: (a) As per joint venture agreements, the scope & value of work of each partner has been clearly defined and accepted bythe clients. The Company’s share in Assets, Liabilities, Income and Expenses are duly accounted for in the accountsof the Company in accordance with such division of work and therefore does not require separate disclosure. However,joint venture partners are jointly & severally liable to clients for any claims in these projects.
b) Financial interest in jointly controlled entities
Rs. in ’000
Company’s Share of
S. Name of Joint Ventures Assets Liabilities Income Expenditure Tax Capital ContingentNo. Entity Commitments Liabilities
1 Thiruvananthpuram Road 738,212 607,961 – – – @ –Development Company Limited * (471,266) (471,016) (–) (–) (–) (–) (–)
2 Kaefer Punj Lloyd Ltd. 35,595 17,487 – – – – –(Formerly known as Punj (–) (–) (–) (–) (–) (–) (–)Lloyd Insulations Limited) *
3 Swissport Punj Lloyd India 6,093 7,854 – – – – –Pvt. Ltd. * (–) (–) (–) (–) (–) (–) (–)
4 Dayim Punj Lloyd 10,407 828 – – – – –Construction Contracting Co. Ltd. (–) (–) (–) (–) (–) (–) (–)
Notes:
1) Figures in bracket relate to previous year
2) * The Company’s share of Assets, Liabilities, Income and Expenditure have been included on the basis of unauditedfinancial statements received from the joint ventures.
@ Capital Commitments- Estimated amount of contracts remaining to be executed on capital account and not provided for(net of advances) Rs. 346,460 thousand (Previous year Rs. 593,485 thousand).
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 85 |
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06,
673
Luv
Chh
abra
--
--
--
7,56
36,
666
--
7,56
36,
666
Uda
y P
unj
--
--
--
-4,
508
--
-4,
508
Mah
inde
r Pra
kash
--
--
--
-16
0-
--
160
RE
LA
TE
D P
AR
TY
DIS
CIO
SU
RE
S
| 86 |
P.K
.Gup
ta-
--
--
--
1,57
9-
--
1,57
9V
.K.S
ud-
--
--
--
2,04
4-
--
2,04
4T
arw
inde
r Sin
gh-
--
--
--
2,77
8-
--
2,77
8H
K K
aul
--
--
--
-1,
582
--
-1,
582
Div
iden
d P
aym
ent
Indt
ech
Con
stru
ctio
n P
vt L
td-
--
--
--
-4,
230
1,98
34,
230
1,98
3C
awdo
r Ent
erpr
ises
Ltd
--
--
--
--
15,2
087,
096
15,2
087,
096
Oth
ers
--
--
--
8,82
84,
522
353
165
9,18
14,
687
Ren
tP
unj B
usin
ess
Cen
ter
--
--
--
--
22,4
9522
,527
22,4
9522
,527
PT
A E
ngin
eerin
g an
d M
anpo
wer
Ser
vice
s P
vt L
td-
--
--
--
-1,
500
1,50
01,
500
1,50
0A
SS
ET
SIn
ven
tory
So
ldP
unj L
loyd
Kaz
akhs
tan
LLP
-6,
048
--
--
--
--
-6,
048
Fix
ed A
sset
s S
old
PT
Pun
j Llo
yd In
done
sia
8,56
460
,754
--
--
--
--
8,56
460
,754
Pun
j Llo
yd K
azak
hsta
n LL
P16
4,99
124
1,19
5-
--
--
--
-16
4,99
124
1,19
5F
ixed
Ass
ets
Pu
rch
ased
Spe
ctra
Pun
j Llo
yd L
imite
d-
2,21
9-
--
--
--
--
2,21
9P
T P
unj L
loyd
Indo
nesi
a19
9,06
3-
--
--
--
--
199,
063
-C
olle
ctib
le @
The
Insi
de S
tory
--
--
--
--
1,27
7-
1,27
7-
Inve
stm
ent m
ade
du
rin
g th
e ye
arP
T P
unj L
loyd
Indo
nesi
a-
159,
990
--
--
--
--
-15
9,99
0S
wis
spor
t Pun
j Llo
yd In
dia
Pvt
Ltd
--
49-
--
--
--
49-
Thi
ruva
nant
hapu
ram
Roa
d D
evel
opm
ent
Com
pany
Lim
ited
--
130,
000
--
--
--
-13
0,00
0-
Day
im P
unj L
loyd
Con
stru
ctio
nC
ontr
actin
g C
o. L
td.
--
11,7
95-
--
--
--
11,7
95-
Pun
j Llo
yd K
azak
hsta
n LL
P-
358,
740
--
--
--
--
-35
8,74
0P
unj L
loyd
Pte
Ltd
673,
799
--
--
--
--
-67
3,79
9-
Sim
on C
arve
s In
dia
Ltd
20,0
00-
--
--
--
--
20,0
00-
Inve
stm
ent a
dju
sted
on
acc
ou
nt o
fL
iqu
idat
ion
Pun
j Llo
yd (M
alas
iya)
SD
N B
HD
44,1
41-
--
--
--
--
44,1
41-
Pun
j Llo
yd In
c.8,
493
--
--
--
--
-8,
493
-In
vest
men
t so
ld d
uri
ng
the
year
Bis
tro
Hos
pita
lity
Priv
ate
Lim
ited
--
--
28,7
824,
018
--
--
28,7
824,
018
OT
HE
RS
Ban
k G
uar
ante
es Is
sued
du
rin
g th
e ye
arP
T. P
unj L
loyd
Indo
nesi
a-
1,24
5,52
2-
--
--
--
--
1,24
5,52
2P
unj L
loyd
Pte
Ltd
1,02
4,08
2-
--
--
--
--
1,02
4,08
2-
Sem
baw
ang
Eng
inee
ring
& C
onst
ruct
ion
Pte
Ltd
.10
2,65
5-
--
--
--
--
102,
655
-S
wis
spor
t Pun
j Llo
yd In
dia
Pvt
Ltd
--
6,00
0-
--
--
--
6,00
0-
Ban
k G
uar
ante
es r
edee
med
du
rin
g th
e ye
arP
T. P
unj L
loyd
Indo
nesi
a1,
310,
470
--
--
--
--
-1,
310,
470
-P
unj L
loyd
- P
rogr
essi
ve C
onst
ruct
ion
JV-
-15
4,64
0-
--
--
--
154,
640
-C
orp
ora
te G
uar
ante
es Is
sued
du
rin
g th
e ye
arS
pect
ra P
unj L
loyd
Lim
ited
-36
,691
--
--
--
--
-36
,691
Pun
j Llo
yd K
azak
hsta
n LL
P74
0,63
645
0,31
4-
--
--
--
-74
0,63
645
0,31
4K
aefe
r Pun
j Llo
yd L
td (F
orm
erly
kno
wn
asP
unj L
loyd
Insu
latio
ns L
imite
d)-
30,0
00-
--
--
--
--
30,0
00P
T. P
unj L
loyd
Indo
nesi
a27
6,88
51,
358,
424
--
--
--
--
276,
885
1,35
8,42
4P
LN C
onst
ruct
ion
Lim
ited
90,0
00-
--
--
--
--
90,0
00-
Pun
j Llo
ys P
te L
td11
,679
,713
--
--
--
--
-11
,679
,713
-
RE
LA
TE
D P
AR
TY
DIS
CIO
SU
RE
S (C
on
td.)
Su
bsi
dia
ryJo
int V
entu
res
Ass
ocia
tes
Key
man
agem
ent
En
terp
rise
s o
ver
wh
ich
To
tal
per
son
nel
or
thei
rre
lati
ve o
f key
Man
ager
ial
rela
tives
Per
son
nel
are
exc
erci
sin
gsi
gn
ific
nt I
nfl
uen
ce(R
s.in
‘000
)(R
s.in
‘000
)(R
s.in
‘000
)(R
s.in
‘000
)(R
s.in
‘000
)(R
s.in
‘000
)
Mar
chM
arch
Mar
chM
arch
Mar
chM
arch
Mar
chM
arch
Mar
chM
arch
Mar
chM
arch
31, 2
007
31, 2
006
31, 2
007
31, 2
006
31, 2
007
31, 2
006
31, 2
007
31, 2
006
31, 2
007
31,
200
631
, 200
731
, 200
6
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 87 |
Co
rpo
rate
Gu
aran
tees
red
eem
ed d
uri
ng
the
year
Pun
j Llo
yd K
azak
hsta
n LL
P-
1,30
9,84
9-
--
--
--
--
1,30
9,84
9S
pect
ra P
unj L
loyd
Lim
ited
84,7
74-
--
--
--
--
84,7
74-
Bis
tro
Hos
pita
lity
Priv
ate
Lim
ited
--
--
68,0
00-
--
--
68,0
00-
Sh
are
app
licat
ion
mo
ney
giv
enS
wis
spor
t Pun
j Llo
yd In
dia
Pvt
Ltd
--
1,45
1-
--
--
--
1,45
1-
Pun
j Llo
yd P
te L
td2,
824,
652
--
--
--
--
-2,
824,
652
-T
hiru
vana
ntha
pura
m R
oad
Dev
elop
men
tC
ompa
ny L
imite
d-
-1
13,0
01-
--
--
-1
13,0
01B
AL
AN
CE
OU
TS
TA
ND
ING
AS
AT
MA
RC
H 3
1, 2
007
Rec
eiva
ble
/ (p
ayab
les)
Spe
ctra
Net
Lim
ited
8,17
09,
606
--
--
--
--
8,17
09,
606
Spe
ctra
Pun
j Llo
yd L
imite
d10
,499
(4,5
64)
--
--
--
--
10,4
99(4
,564
)K
aefe
r Pun
j Llo
yd L
td (F
orm
erly
kno
wn
asP
unj L
loyd
Insu
latio
ns L
imite
d)-
(14,
239)
(5,7
45)
--
--
--
-(5
,745
)(1
4,23
9)P
T P
unj L
loyd
Indo
nesi
a43
,454
(20,
535)
--
--
--
--
43,4
54(2
0,53
5)P
unj L
loyd
(Mal
asiy
a) S
dn. B
hd.
-(5
8,73
5)-
--
--
--
--
(58,
735)
Pun
j Llo
yd In
c.-
15,7
79-
--
--
--
--
15,7
79P
unj L
loyd
Inte
rnat
iona
l(1
3,02
5)(1
1,12
6)-
--
--
--
-(1
3,02
5)(1
1,12
6)P
unj L
loyd
Kaz
akhs
tan
LLP
163,
547
13,3
18-
--
--
--
-16
3,54
713
,318
PLN
Con
stru
ctio
n Li
mite
d(4
4,76
1)49
,224
--
--
--
--
(44,
761)
49,2
24P
unj L
loyd
Pte
Ltd
246,
377
--
--
--
--
-24
6,37
7-
Sem
bcor
p E
ngin
eerin
g &
Con
stru
ctio
n P
te L
td13
4,41
2-
--
--
--
--
134,
412
-S
wis
spor
t Pun
j Llo
yd In
dia
Pvt
Ltd
--
1,71
4-
--
--
--
1,71
4-
Sim
on C
arve
s In
dia
Ltd
6,60
4-
--
--
--
--
6,60
4-
Joiin
t Ven
ture
of W
hess
oe O
il &
Gas
Ltd
and
Pun
j Llo
yd L
td-
-1,
299
--
--
--
-1,
299
-S
emba
wan
g S
imon
Car
ves
Ltd
20,4
61-
--
--
--
--
20,4
61-
Thi
ruva
nant
hapu
ram
Roa
d D
evel
opm
ent
Com
pany
Lim
ited
--
271,
386
214,
338
--
--
--
271,
386
214,
338
Day
im P
unj L
loyd
Con
stru
ctio
nC
ontr
actin
g C
o. L
td.
--
875
--
--
--
-87
5-
Col
lect
ible
@ T
he In
side
Sto
ry-
--
--
--
-(1
21)
-(1
21)
-V
ishw
edev
a B
uild
ers
and
Pro
mot
ers
Pvt
Ltd
--
--
--
--
-(2
07)
-(2
07)
PT
A E
ngin
eerin
g an
d M
anpo
wer
Ser
vice
s P
vt L
td-
--
--
--
-(5
87)
(284
)(5
87)
(284
)In
do P
acifi
c A
viat
ion
Pvt
Ltd
--
--
--
--
17,1
04(9
34)
17,1
04(9
34)
Pet
ro IT
Pvt
Ltd
--
--
--
--
(4,6
40)
-(4
,640
)-
Sal
ary
/ Co
mm
issi
on
Pay
able
Atu
l Pun
j-
--
--
-10
,000
--
-10
,000
-V
.K. K
aush
ik-
--
--
-2,
255
1,33
1-
-2,
255
1,33
1Lu
v C
hhab
ra-
--
--
-2,
409
1,25
6-
-2,
409
1,25
6Lo
ans
Pun
j Llo
yd K
azak
hsta
n LL
P30
7,99
832
3,34
9-
--
--
--
-30
7,99
832
3,34
9S
pect
ra N
et H
oldi
ng L
imite
d-
(8,5
00)
--
--
--
--
-(8
,500
)In
vest
men
tsP
unj L
loyd
Inc.
-8,
493
--
--
--
--
-8,
493
Pun
j Llo
yd In
tern
atio
nal L
imite
d4,
452
4,45
2-
--
--
--
-4,
452
4,45
2S
pect
ra In
fras
truc
ture
Lim
ited
115,
002
115,
002
--
--
--
--
115,
002
115,
002
Kae
fer P
unj L
loyd
Ltd
(For
mer
ly k
now
n as
Pun
j Llo
yd In
sula
tions
Lim
ited)
-2,
552
2,55
2-
--
--
--
2,55
22,
552
Spe
ctra
Net
Lim
ited
17,0
6117
,061
--
--
--
--
17,0
6117
,061
Atn
a In
vest
men
ts L
imite
d39
,922
39,9
22-
--
--
--
-39
,922
39,9
22P
unj L
loyd
Kaz
akhs
tan
LLP
362,
798
362,
798
--
--
--
--
362,
798
362,
798
Pun
j Llo
yd (M
alas
iya)
Sdn
. Bhd
.-
44,1
41-
--
--
--
--
44,1
41P
LN C
onst
ruct
ion
Lim
ited
30,8
9630
,896
--
--
--
--
30,8
9630
,896
Spe
ctra
Pun
jab
Lim
ited
8,00
08,
000
--
--
--
--
8,00
08,
000
RE
LA
TE
D P
AR
TY
DIS
CIO
SU
RE
S (C
on
td.)
Su
bsi
dia
ryJo
int V
entu
res
Ass
ocia
tes
Key
man
agem
ent
En
terp
rise
s o
ver
wh
ich
To
tal
per
son
nel
or
thei
rre
lati
ve o
f key
Man
ager
ial
rela
tives
Per
son
nel
are
exc
erci
sin
gsi
gn
ific
nt I
nfl
uen
ce(R
s.in
‘000
)(R
s.in
‘000
)(R
s.in
‘000
)(R
s.in
‘000
)(R
s.in
‘000
)(R
s.in
‘000
)
Mar
chM
arch
Mar
chM
arch
Mar
chM
arch
Mar
chM
arch
Mar
chM
arch
Mar
chM
arch
31, 2
007
31, 2
006
31, 2
007
31, 2
006
31, 2
007
31, 2
006
31, 2
007
31, 2
006
31, 2
007
31,
200
631
, 200
731
, 200
6
| 88 |
PT
Pun
j Llo
yd In
done
sia
170,
900
170,
900
--
--
--
--
170,
900
170,
900
Spe
ctra
Pun
j Llo
yd L
imite
d48
,675
48,6
75-
--
--
--
-48
,675
48,6
75P
unj L
loyd
Pte
Ltd
673,
799
--
--
--
--
-67
3,79
9-
Sim
on C
arve
s In
dia
Ltd
20,0
00-
--
--
--
--
20,0
00-
Thi
ruva
nant
hapu
ram
Roa
d D
evel
opm
ent
Com
pany
Lim
ited
--
130,
250
250
--
--
--
130,
250
250
Bis
tro
Hos
pita
lity
Priv
ate
Lim
ited
--
--
-28
,782
--
--
-28
,782
Day
im P
unj L
loyd
Con
stru
ctio
nC
ontr
actin
g C
o. L
td.
--
11,7
95-
--
--
--
11,7
95-
Sw
issp
ort P
unj L
loyd
Indi
a P
vt L
td-
-49
--
--
--
-49
-B
ank
Gu
aran
tees
Pt.
Pun
j Llo
yd In
done
sia
185,
668
1,49
6,13
8-
--
--
--
-18
5,66
81,
496,
138
Pun
j Llo
yd P
te L
td1,
024,
082
--
--
--
--
-1,
024,
082
-S
emba
wan
g E
ngin
eerin
g &
Con
stru
ctio
n P
te L
td10
2,65
5-
--
--
--
--
102,
655
-P
unj L
loyd
- P
rogr
essi
ve C
onst
ruct
ion
JV-
--
154,
640
--
--
--
-15
4,64
0T
hiru
vana
ntha
pura
m R
oad
Dev
elop
men
tC
ompa
ny L
imite
d-
-25
,000
25,0
00-
--
--
-25
,000
25,0
00S
wis
spor
t Pun
j Llo
yd In
dia
Pvt
Ltd
--
6,00
0-
--
--
--
6,00
0-
Co
rpo
rate
Gu
aran
tees
Spe
ctra
Pun
j Llo
yd L
imite
d57
,500
142,
274
--
--
--
--
57,5
0014
2,27
4P
unj L
loyd
Kaz
akhs
tan
LLP
1,64
3,37
290
2,73
6-
--
--
--
-1,
643,
372
902,
736
Kae
fer P
unj L
loyd
Ltd
(For
mer
ly k
now
n as
Pun
j Llo
yd In
sula
tions
Lim
ited)
-52
,500
52,5
00-
--
--
--
52,5
0052
,500
PT
. Pun
j Llo
yd In
done
sia
4,10
4,60
63,
827,
721
--
--
--
--
4,10
4,60
63,
827,
721
PLN
Con
stru
ctio
n Li
mite
d90
,000
--
--
--
--
-90
,000
-P
unj L
loys
Pte
Ltd
11,6
79,7
13-
--
--
--
--
11,6
79,7
13-
Bis
tro
Hos
pita
lity
Priv
ate
Lim
ited
--
--
-68
,000
--
--
-68
,000
RE
LA
TE
D P
AR
TY
DIS
CIO
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A n n u a l R e v i e w 2 0 0 6 - 0 7 | 89 |
6. Capital Commitments
2006-07 2005-06
Rs. in ’000 Rs. in ’000
Estimated amount of contracts remaining to be executed on capital account and
not provided for (net of advances) 166,582 581,445
7. Contingent liabilities not provided for :
2006-07 2005-06
Rs. in ’000 Rs. in ’000
a) i) Bank Guarantees given by the Company 194,505 322,175
ii) Bank Guarantees given on behalf of subsidiaries and joint ventures 84,774 1,377,163
b) Liquidated damages deducted by customers not accepted by the Company and pending final settlement.(Refer Note 10 (b) below) 448,839 449,558
c) Corporate Guarantees given on behalf of subsidiaries, joint ventures and associates 17,627,691 4,993,231
d) Differential amount of customs duty in respect of machinery imported underEPCG Scheme. – 89,483
18,355,809 7,231,610
e) Estimated future investments in joint venture & other companies in terms of respective shareholder agreementsamounting in aggregate to Rs. 40,049 thousand (Previous year Rs. 1,220,049 thousand).
f) (i) Sales tax demand on the material components of the works contracts pending with Sales Tax Authorities andHigh Court amounting to Rs. 36,083 thousand (Previous year Rs. 141,866 thousand.)*
(ii) Sales tax demand for non submission of statutory forms aggregating to Rs. 66,006 thousand (Previous year Rs.66,006 thousand)*
(iii) Sales tax demand for disallowance of deduction on purchase aggregating to Rs. 4,201 thousand (Previous yearRs. 43,619 thousand)*
(iv) Sales Tax liability for purchases against sales tax forms not accepted by department Rs. 22,756 thousand(Previous year Rs. 31,146 thousand) *
(v) Entry Tax liability against entry of goods into the local area not accepted by department Rs 18,856 thousand(Previous year Rs. Nil) *
(vi) Sales Tax liability against the CST demand on sales in transit Rs 720 thousand (Previous year Rs. Nil) *
(vii) Sales tax demand in respect of Internet Service Division regarding taxability of internet services Rs. 21,178thousand (Previous year Rs. 21,178 thousand). The same is contested by the company in view of similar matterdecided by the Hon’ble Supreme Court of India in the case of Bharat Sanchar Nigam Ltd & another Vs Union ofIndia & others wherein it was held that internet services are not taxable as goods. *
g) The Company has not acknowledged as debt a claim lodged by one of its suppliers amounting to Rs. 35,448 thousand(Previous year Rs. 5,082 thousand) on account of services rendered in earlier years. The matter is under arbitration.*
* Based on favourable decisions in similar cases/legal opinions taken by the Company/consultations with solicitors,the management believes that the Company has good chances of success in above mentioned cases and hence, noprovision there against is considered necessary.
8. Leases
a) Assets taken under Finance Leases
The Company has acquired certain Project Equipment under hire purchase, the cost of which is included in the grossblock of Plant & Machinery under Fixed Assets. The lease term is for 3 years to 5 years, after which the legal title willpass on to the Company. There is no escalation clause in the lease agreements. There are no restrictions imposed bylease arrangements. There are no sub leases.
| 90 |
Rs in ’000
2006-07 2005-06
Gross block at the end of year 271,724 359,207
Written down value at the end of year 233,436 324,415
Details of payments made during the year .
Principal 79,204 43,967
Interest 19,329 9,343
The break-up of minimum hire purchase payments outstanding as at March 31, 2007 is as under
As at March 31, 2007
Principal Interest Total
Rs. in ’000 Rs. in ‘000 Rs. in ’000
Payable within one year 59,416 13,330 72,745
Payable after one year but before end of fifth year 156,149 15,492 171,641
215,565 28,822 244,386
As at March 31,2006
Principal Interest Total
Rs. in ’000 Rs. in ’000 Rs. in ’000
Payable within one year 79,204 19,329 98,533
Payable after one year but before end of fifth year 212,638 28,089 240,727
291,842 47,418 339,260
b) Assets taken under Operating Leases
Certain Project Equipment and Office premises are obtained on operating leases. There are no contingent rents in thelease agreements. The lease term is for 1-3 years and is renewable at the mutual agreement of both the parties. Thereis no escalation clause in the lease agreements. There are no restrictions imposed by lease arrangements. There areno subleases and all the leases are cancelable in nature.
c) Assets given on operating leases Rs in ’000
Year ended Year endedMarch 31, 2007 March 31, 2006
Uncollectible minimum lease payments receivable at the
Balance sheet date – –
Future minimum lease payments
Not later than one year 2,297 –
Later than one year and not later than five years 6,894 –
Later than five years – –
Total 9,191 –
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 91 |
9. Particulars of balances with non Scheduled banks with whom the Company had dealings during the year are as follows:
Name of bank Balance as at March 31, 2007 Balance as at March 31, 2006
Rs. in ’000 Maximum balance Rs. in ’000 Maximum balanceduring the year during the year
(Rs. in ’000) (Rs in ’000)
Balances in Current Accounts:Hongkong & Shanghai Banking Corporation,Indonesia 179 192 198 206Standard Chartered Bank, Indonesia 532 535 553 554
Mashreq Bank – Fuji Proj, UAE 1,393 4,724 167 169Mashreq Bank – UAE 10 4,035 1,069 33.628Dubai Islamic Bank – General Account, UAE 261 521 539 608
Dubai Islamic Bank – Current Account, UAE 379 88,993 55 6,737National Bank of Abu Dhabi, UAE (USD) 4,138 117,130 5,445 22,420
National Bank of Abu Dhabi, UAE (AED) 8,773 91,919 42,345 46,284Mashreq Bank – Qatar 744 744 771 16,085Bank Muscat – Oman (USD) 1,090 132,499 – –
Bank Muscat – Oman (OMR) 501 41,860 – –Garanti Bank-Turkey 2,320 131,204 268 137,738UCO Bank- Singapore – 230,102 220,749 239,499
UCO Bank- Singapore – 475,788 308,700 402,865Bank of Commerce & Development Tripoli - – 307,138 1,370 6,667LibyaSBI, Singapore 887 889 928 8,909DBS Bank, Singapore (SGD) 4,780 18,954 – –
DBS Bank, Singapore (USD) 30,914 2,494,349 – –National Bank of Oman, Oman 117 117 – –Union National Bank, UAE 206 65,362 – –
ADSC Bank, UAE 799 2,627 – –Hongkong & Shanghai Banking Corporation, 536 32,352 – –UAE (USD)Hongkong & Shanghai Banking Corporation, 275 20,776 – –UAEDoha Bank, Qatar 3,695 180,131 – –Arab Bank PLC, Qatar 128,210 396,252 – –
Arab Bank PLC, Qatar 2,119 750,966 – –Arab Bank PLC, Bahrain 753 3,693 – –Sahari Bank (MELITA), Libya 19,867 55,767 – –
Sahari Bank (EL KHOMS), Libya 60,406 119,235 – –Islam Bank Yemen (YER) 3,209 4,379 – –
Islam Bank Yemen (USD) 6,620 26,066 – –Mashreq Bank – Yemen (USD) 13,917 60,080 – –Mashreq Bank – Yemen (AED) 12 4,232 – –
Balances in Fixed Deposits:Mashreq Bank UAE 16,829 16,829 13,680 59,910State Bank of India, Singapore – – – 91,817
Arab Bank PLC, Qatar 166,016 166,016 – –
Mashreq Bank – Yemen 6,288 6,288 – –
| 92 |
10. (a) The Company had executed two projects of Sulphur Recovery Units (SRU) of Indian Oil Corporation Limited (IOCL) attheir refineries at Mathura and Vadodara in an earlier year on back to back basis for Petrofac International Limited (PIL)who was the main contractor. IOCL had withheld payments from PIL on account of duties and taxes and PIL had in turnwithheld Rs 294,065 thousand (Previous year Rs. 297,734 thousand) from the Company in an earlier year, which areoutstanding as debts at the close of the year. PIL had gone into arbitration against IOCL and lodged claims for recoveryof above amount and also some other claims amounting to Rs. 387,034 thousand (Previous yearRs. 387,034 thousand). These claims of Rs. 387,034 thousand have not been accounted for in the books. Pendingoutcome of arbitration, amount withheld by PIL is being carried forward under sundry debtors. The Company has beenlegally advised that in terms of the contract, it is entitled to receive the above amount and hence, the same is consideredgood of recovery.
(b) The Company had executed a pipeline project at Dahej- Vijaypur for Gas Authority of India Limited (GAIL) in an earlieryear. GAIL had withheld Rs. 421,725 thousand (Previous year Rs. 423,707 thousand) as liquidated damages andRs. 40,441 thousand (Previous year Rs. 40,441 thousand) towards other deductions, which the Company is disputing.Also, the Company has filed some other claims with GAIL amounting to Rs. 999,004 thousand (Previous yearRs. 999,004 thousand). These claims have not been accounted for in the books. The Company had gone into arbitrationagainst GAIL for recovery of amount withheld as liquidated damages & other deductions and claims of the Company.Pending outcome of arbitration, amount withheld for liquidated damages & other deductions are being carried forwardunder sundry debtors. The Company has been legally advised that there is no justification in imposition of liquidateddamages and other deductions by GAIL and hence the above amount is considered good of recovery.
(c) The Company had executed a pipeline project for Petronet MHB Limited in an earlier year. The customer had withheldRs. 4,440 thousand (Previous year Rs 4,440 thousand) from the running bills, which are being carried forward undersundry debtors. The customer had also not certified the final bill amounting to Rs.64,000 thousand (Previous yearRs. 64,000 thousand) which is being carried forward under work in progress. The Company had raised claims forRs. 517,387 thousand (Previous year Rs.517,387 thousand), which are not accounted for in the books. For recoveryof the said amounts, which are being disputed by the customer, the Company has initiated Arbitration proceedings.The outstanding amounts are considered good of recovery.
11. The Company in the previous year had raised variation orders of Rs. 1,448,892 thousand (Previous year Rs. 1,490,000thousand) on Spie Capag-Petrofac International Limited (SCPIL) with whom the Company had entered into a contract forconstruction of pipelines in Georgia. SCPIL had raised debit notes of Rs. 464,166 thousand (Previous year Rs. 477,400thousand) on the Company. These variations orders and debit notes are being disputed and have not been agreed betweenthe management of the Company and SCPIL. However, the ultimate outcome of the dispute cannot presently be determinedby the Company. Accordingly, these variation orders and debit notes have not been recorded in these financial statements.An amount of Rs. 367,531 thousand including Rs. 292,671 thousand in respect of invoices raised and Rs. 74,860 thousandin respect of debit notes (Previous year Rs. 301,016 thousand and Rs. 77,000 thousand respectively) is withheld by SCPILin view of the disputes. This amount is being carried forward under sundry debtors and is considered good of recovery.
SCPIL has purported to serve a notice of suspension to the Company by letter dated February 22, 2005 and a notice ofintention to Terminate Subcontract Agreement for Default dated March 28, 2005. The Company does not accept that thegrounds for service of the Notices are valid.
12. The disclosures as per provisions of Clauses 38, 39 and 41 of Accounting Standard 7 issued by Institute of CharteredAccountants of India are as under:
2006-07 2005-06
Rs. in ’000 Rs. in ’000
a) Contract revenue recognised as revenue in the period Clause 38 (a) 21,392,550 13,118,222
b) Aggregate amount of costs incurred and recognised profits up to the
reporting date on Contract under progress Clause 39 (a) 42,926,811 28,932,256
c) Advance received on Contract under progress Clause 39 (b) 4,918,914 826,695
d) Retention amounts on Contract under progress Clause 39 (c) 394,227 148,219
e) Gross amount due from customers for contract work as an asset Clause 41(a) 8,926,404 5,682,671
f) Gross amount due to customers for contract work as a liability Clause 41 (b) 391,341 210,033
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 93 |
13. (a) The Company alongwith one of its subsidiaries, Atna Investments Limited have invested Rs. 53,313 thousand (Previousyear Rs. 53,313 thousand) in equity shares of Spectranet Limited (SNL), a subsidiary company engaged in thebusiness of providing Cable TV services. Also, another subsidiary of the Company, Spectra Infrastructure Ltd., hasgiven share application money amounting to Rs. 45,791 thousand (Previous year Rs. 45,791 thousand) to SNL. SNLhas been incurring losses and a substantial portion of its networth has been eroded. However, based on valuation ofSNL done by a valuer and in view of this being a long term strategic investment, the management does not feel thenecessity of making a provision against the above investment at this stage.
(b) The Company has invested Rs. 8,000 thousand (Previous year Rs. 8,000 thousand) in equity shares of SpectraPunjab Limited (SPL), a subsidiary company, which in earlier years had laid down optical fiber cable and ductsnetwork in the State of Punjab for providing broad band services. Also, another subsidiary of the Company, SpectraInfrastructure Ltd., has given share application money amounting to Rs. 52,175 thousand (Previous year Rs 52,175thousand) to SPL. SPL operations remain suspended presently. However, the Company proposes to use its owninternet service network to restart the operations of SPL. Based on the valuation of assets of SPL done by a valuer, themanagement does not feel the necessity of making a provision against the above investment at this stage.
14. Current Assets include Rs. 4,225 thousand (Previous year Rs. 4,225 thousand) recoverable pursuant to agreements for saleof 128,400 shares (Previous year 128,400 shares) of Panasonic Battery India Company Limited (Formerly known asLakhanpal National Limited) entered into on March 27,1992, which are subject matter of a dispute in the Honourable HighCourt at Bombay, wherein the Company has been restrained from transferring these shares till the final disposal of the suit.These shares remain in the possession of the Company and the market value thereof at close of the year is Rs. 8,218thousand (Previous year Rs. 9,309 thousand).
15. During an earlier year, the Company had entered into agreements to sell its investments in the shares of certain Companiesof the cost of Rs.111,974 thousand and had received advances representing consideration for the future sale of shares (asdefined in the above agreements) in these companies, including all accretions thereto till the date of sale. Through theabove agreements to sell, the Company had agreed to give all the powers and rights in these shares to purchasers. In termsof the above arrangement, the Company in that year had accounted for Rs. 20,300 thousand, being the amount received inexcess of book vale of shares (for all the companies) as income on transfer of the powers and rights in the underlying sharesto purchasers and the balance consideration of Rs. 111,974 thousand equivalent to the amount of investment in aboveshares appearing in the books is shown as deposit under Current Liabilities to be adjusted against the sale of shares in theabove companies on the date of sale.
16. The Company in an earlier year had entered into an Assets Sale Agreement for sale of its certain fixed assets relating to ISPundertaking. The sale tax liability on such transaction is subject to determination by the relevant authorities for which anapplication is pending adjudication. The amount of such liability is indeterminable at present. As per agreement with thebuyer, any such sale tax liability is to be borne by the buyer. Consequently, aforesaid sale tax liability on such transactionshas not been provided for.
17. During the year, the business of branch operation of the Company in Singapore has been transferred to its wholly ownedSubsidiary Punj Lloyd Pte Ltd., Singapore for operational and financial efficiencies, effective July 01, 2006. Accordinglyfinancial statements for the year ended March 31, 2007, include the figure in respect of the branch only for the first three months.
18. During the year, Spectra Punj Lloyd Ltd (SPLL), a subsidiary of the Company, has applied for delisting of its equity sharecapital in accordance with Clause 7 of the Securities and Exchange Board of India (Delisting of Securities) Guidelines 2003(the “Guideline”) and such other provisions as may be applicable. The Company along with Atul Punj, Shiv Punj, Arti Punj,Jyoti Punj, PLE Hydraulics Private Limited, Atna Investments Limited and Jyotcon Equipments Hire Private Limited (i.e.persons acting in concert) have made an offer to acquire 25,000 shares in Spectra Punj Lloyd Ltd. at a price to be determinedunder Reverse Book Building process in accordance with the Securities and Exchange Board of India (Delisting of Securities)Guidelines 2003.
19. The Micro, Small and Medium Enterprises have been identified by the Company from the available information, which hasbeen relied upon by the auditors. According to such identification, the disclosures in respect to Micro, Small and MediumEnterprises Development (MSMED) Act, 2006 is as follows:S. No. Particulars Rs. in ’000i) the principal amount and the interest due thereon remaining unpaid to any supplier
- Principal amount Nil- Interest thereon Nil
ii) the amount of interest paid by the buyer in terms of Section 18, along with the amounts of the payment made to the supplier beyond the appointed day Nil
iii) the amount of interest due and payable for the year of delay in making payment (which havebeen paid but beyond the appointed day during the year) but without adding the interest specifiedunder this Act Nil
iv) the amount of interest accrued and remaining unpaid Nilv) The amount of further interest remaining due and payable even in the succeeding years, Nil
until such date when the interest dues above are actually paid to the small investor
| 94 |
20. EARNING PER SHARE
Basic Earnings
2006-07 2005-06
a) Calculation of weighted average number of equity shares of Rs. 2 each
Number of equity shares at the beginning of the year 261,099,180 121,585,635
Equity shares at the end of the year 261,260,335 261,099,180
Weighted average number of equity shares outstanding during the year 261,145,385 217,608,380
(taking into consideration split of equity shares in terms of para 24 of AS-20)
b) Net Profit after tax available for equity shareholders (Rs. in thousand) 615,846 351,470
c) Basic earning per share 2.36 1.62
Diluted Earnings
2006-07 2005-06
a) Calculation of weighted average number of equity shares of Rs. 2 each
Number of equity shares at the beginning of the year 261,099,180 121,585,635
Equity shares at the end of the year 261,260,335 261,099,180
Weighted average number of equity shares outstanding during the year 281,148,570 229,967,573
(taking into consideration split of equity shares in terms of para 24 of AS-20)
b) Net Profit after tax available for equity shareholders (Rs. in thousand) 615,846 351,470
c) Diluted earning per share 2.19 1.53
21. Deferred Tax Liability (Net)
Rs. in ’000
Deferred Tax Current Year Deletion on Deferred TaxAsset/(Liability) (Charge)/ divestment of Asset/(Liability)
as at April 01, 2006 Credit stake in a branch as at March31, 2007
Deferred Tax Liabilities
Differences in depreciation and other differences (501,588) (54,994) – (556,582)in block of Fixed assets as per Income Tax &Financial Books
Effect of expenditure not debited to Profit & Loss (65,990) (20,215) – (86,205)Account but allowable in Income Tax
Difference in carrying value of Scaffolding as per (6,793) (416) – (7,209)Income Tax & Financial Books
Differences in depreciation and other differences – (1,370) 1,370 –in block of Fixed assets of Singapore branch
Deferred Tax Assets
Effect of expenditure debited to Profit & Loss 9,683 7,064 – 16,747Account in the current year but allowable infollowing years under Income Tax
Provision for Doubtful Debts & Advances – 27,291 – 27,291
Disallowance u/s 40(a)(i) 6,496 (6,496) – –
Deferred Tax Liability (Net) (558,192) (49,136) 1,370 (605,958)
22. (a) During the previous year, the Company had made Initial Public Offering (IPO) of 9,172,937 Equity Shares of Rs. 10each for cash at premium of Rs. 690 per share, comprising of 8,355,174 Equity Shares freshly issued by the Companyand 817,763 Equity Shares offered for sale by the Selling Shareholders.
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 95 |
(b) Initial Public Offer (IPO) fund utilization: The Company has spent Rs. 5,848,621 thousand (Previous year Rs. 4,800,927thousand) out of fresh issue of share capital of Rs. 5,848,621 thousand as follows:
Rs.in ’000
Particulars Projected Utilisation as per Actual as on Actual as on
the Prospectus dated March 31, 2007 March 31, 2006
December 19, 2005
Investment in Capital Equipment Up to 1,500,000 1,485,269 705,230
Prepayment of Debts Up to 3,000,000 3,064,170 3,064,170
Equity Investment in Infrastructure Projects, Up to 500,000 453,306 203,510
WOS and JVs
General Corporate Purposes 522,921 540,779 522,920
Offer related expenses 325,700 305,097 305,097
Total 5,848,621 5,848,621 4,800,927
23. During the year, the Company has introduced Employee Stock Option Scheme, 2006 (ESOP 2006), to grant 1,000,000 stockoptions to employees of the Company. The Remuneration Committee in its meeting held on October 30, 2006 has approvedgrant of 298,210 stock options to employees at a price of Rs. 772.30 (being the market price as defined in SEBI guidelines).These stock options shall vest in the ratio of 10%, 20%, 30% and 40% at the end of one, two, three and four yearsrespectively from the date of grant. The exercise period is eighteen months from the date of vesting. As on March 31, 2007,no stock option has been vested out of this grant.
During the previous year, the Company had introduced Employee Stock Option Plan, 2005 (ESOP 2005) to grant 800,000stock options to the employees. The Remuneration Committee in its meeting held on November 17, 2005 granted 643,489stock options at a price of Rs. 630 each (being at a 10% discount to the IPO price) to employees. These stock options shallvest in the ratio of 10%, 20%, 30% and 40% at the end of one, two, three and four years respectively from the date of grant.The exercise period is three years from the date of vesting. As at March 31, 2007, 64,354 stock options have been vested inthe employees and out of these, 32,231 stock options have been exercised.
As per SEBI guidelines, the shareholders in their meeting held on April 3, 2006, ratified pre IPO stock option plan “ESOP2005” to grant the balance 156,511 stock options to the employees. The Remuneration Committee vide its resolution datedMay 10, 2006 granted 154,208 stock options to employees at a price of Rs. 1,179.95 each (being the market price as definedin the SEBI guidelines). These stock options shall vest in the ratio of 10%, 20%, 30% and 40% at the end of one, two, threeand four years respectively from the date of grant. The exercise period is three years from the date of vesting. As at March 31,2007, no stock option has been vested out of this grant.
24. The following are the details of loans and advances of the Company outstanding at the end of the year in terms of Securities& Exchange Board of India’s circular dated January 10, 2003:
(Rs. in ’000)
Outstanding amount Maximum amount outstandingas at during the year
March 31, March 31, March 31, March 31,
2007 2006 2007 2006
Loans and Advances to SubsidiariesPunj Lloyd Kazakhstan LLP 307,998 323,349 323,349 323,349
All the above loans and advances are repayable on demand.
25. The Company has sub-divided the face value of Equity Shares from Rs. 10 to Rs. 2 w.e.f. March 6, 2007. Consequently thetotal number of shares has increased from 52,252,067 to 261,260,335. Also the number of Equity Shares underlying thevarious stock options and other terms & conditions will accordingly undergo a change.
26. a) During the year, the Company has issued at par, 5 years and 1 day Zero Coupon US $ denominated Foreign CurrencyConvertible Bonds (FCCB) aggregating to US $ 125,000 thousand (INR 5,543,750 thousand as on the date of issue)comprising 1250 bonds of US $ 100,000 each to invest in capital goods, repayment of international debts, possibleacquisitions outside India, investment in BOOT projects, any other use as may be permitted under applicable law or bythe regulatory bodies from time to time. The bond holders have an option of converting these bonds into equity sharesat an initial conversion price of Rs. 1,362.94 per share (Face value Rs. 10) with a fixed rate of exchange conversion of
| 96 |
Rs 44.35 = US $ 1.00, at any time on or after July 1, 2006 and prior to close of business on March 24, 2011, unlessredeemed, repurchased and cancelled or converted.
b) Expenses of Rs. 98,149 thousand incurred in connection with the issue of zero coupon foreign currency convertiblebonds have been adjusted against Securities Premium Account in terms of Section 78 of the Companies Act, 1956.
c) Expenses incurred in connection with the issue of FCCBs include Rs 1,525 thousand paid to the auditors towardsprofessional fees and adjusted against Securities Premium account.
d) Bank balances include Rs 828,085 thousand (previous year Rs Nil) held abroad, being unutilised portion of the FCCBproceeds.
27. Derivative Instruments and Unhedged Foreign Currency Exposure
a) The Company is operating in Singapore, AbuDhabi, Oman, Qatar, Libya, Yemen, Turkey and Indonesia outside India,through its branch offices established in those countries. The contract revenues of these branch offices are denominatedin currencies other than reporting currency and the expenditure of those branch offices are also in currencies otherthan reporting currency. Accordingly, the Company enjoys notional hedge in respect of its foreign branches assets &liabilities, hence in case of cross currency exposures, the Company takes appropriate forward covers which aredisclosed hereunder.
b) (i) Forward covers outstanding as at Balance Sheet date for Indian operation Rs Nil
(ii) Forward covers outstanding as at Balance Sheet date for overseas operations Rs Nil
(iii) Interest rate swap outstanding as at Balance Sheet date Rs Nil
c) Particulars of Unhedged Foreign Currency Exposure as at the Balance Sheet date from Indian Operation:
Particulars Foreign Currency Exchange Rate Rs in ‘000
(i) Payable to Suppliers EUR 955,690 57.5560 (55,006)GBP 668,793 84.8250 (56,730)LYD 26,210 35.4077 (928)QAR 546,373 11.8410 (6,470)SG $ 262,483 28.3910 (7,452)US $ 1,878,184 43.3800 (81,476)
(ii) Advances to Suppliers EUR 89,812 57.5560 5,169GBP 4,590 84.8250 389MUR 11,500 1.3429 15SGD 64,300 28.3910 1,826US $ 1,205,537 43.3800 52,296
(II) External Commercial Borrowing US $ 336,355 43.3800 (14,591)EURO 243,158 57.5560 (13,995)
(III) Receivables US $ 19,855,388 43.3800 861,326SG $ 115,913 28.39101 3,291QAR 1,997,487 1.8410 23,652
(IV) Bank Balances US $ 8,642,459 43.3800 374,910SG $ 168,363 28.3910 4,780AED 63,417 11.7370 744
Fixed Deposits with Bank US $ 19,089,096 43.3800 828,085(V) Investments US $ 4,002,500 43.8106 175,352
KZT 1,107,977,200 0.3274 362,752SG $ 23,000,001 29.2956 673,799
(VI) Advance for Investments SG $ 96,726,307 29.2025 2,824,655
(VII) Due from / (to) SubsidiariesPT Punj Lloyd Indonesia IDR 9,206,217,306 0.00472 43,453Punj Lloyd International US $ 300,251 43.3800 (13,025)Punj Lloyd Kazhakistan, LLP KZT 447,462,125 0.3655 163,547Punj Lloyd Pte Ltd., Singapore SG $ 8,678,017 28.3910 246,378Sembcorp Engineering & Construction SG $ 4,734,326 28.3910 134,412Pte Ltd., SingaporeSimon Carves Limited US $ 471,668 43.3800 20,461Dayim Punj Lloyd Contracting Co.Ltd, UAE AED 74,508 11.7370 875
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 97 |
d) Net Unhedged foreign Currency Exposure in foreign branches (Assets – Liabilities)
Foreign Branches Foreign Currency Exchange Rate Rs in ‘000
(i) Singapore SG $ 15,317,325 28.8832 442,413
(ii) Abu Dhabi AED 83,651,357 11.9870 1,002,736
(iii) Oman OMR 2,373,041 111.9770 265,726
(iv) Qatar QAR 1,568,662 13.7846 21,623
(v) Libya LYD 9,668,681 35.3116 341,417
(vi) Yemen YER 61,622,351 0.2563 (15,798)
(vii) Turkey US $ 5,516,622 43.3800 239,311
(viii) Indonesia IDR 13,001,075,011 0.0053 69,023
e) The Company has outstanding Foreign Currency Convertible Bonds (FCCB) of USD 125 million outstanding at theBalance Sheet date. These are convertible at the option of the holder at an agreed price in INR or the bond holder canopt for redemption. Management feels that these Bonds will be converted and accordingly there is no foreign currencyexposure in this regard.
28. The small scale and ancillary undertakings have been identified by the Company from the available information, which hasbeen relied upon by the auditors. According to such identification and in the opinion of the management, there is no amountpayable to such undertakings at the close of the year. (previous year Rs. Nil)
29. Prior period items debited / (credited) to respective account heads aggregate to Rs. 40,060 thousand (net debit) (previousyear Rs. 33,585 thousand (net debit)).
30. Additional information pursuant to the provisions of paragraphs 3, 4c and 4d of part ii of Schedule VI to the Companies Act, 1956.
a. Purchases, Sales and Stocks of Equipments in Internet Service Division.Amount in INR ‘000
Opening Stock Purchases Sales Internal Closing StockConsum-
ptionQty in Nos. Value Qty in Nos. Value Qty in Nos. Value Qty in Nos. Qty in Nos. Value
Analog STB – – – – – – – – –(137) (1,044) (–) (–) (–) (–) (137) (–) (–)
Keyboards – – – – – – – – –(95) (210) (–) (–) (–) (–) (95) (–) (–)
Digital STB – – – – – – – – –(3) (81) (–) (–) (–) (–) (3) (–) (–)
Cable Modem 181 789 – – 46 177 5 130 608(90) (488) (212) (596) (90) (349) (31) (181) (789)
ADSL Router 215 698 110 254 96 336 19 210 616(126) (684) (382) (966) (205) (714) (88) (215) (698)
ADSL Modem – – – – – – – – –(–) (–) (3) (104) (3) (122) (–) (–) (–)
Cable Router 27 118 10 115 5 185 – 32 150(9) (49) (21) (315) (3) (218) (–) (27) (118)
Transceivers 260 896 292 711 258 2,100 80 214 580(63) (445) (458) (1,569) (230) (1,859) (31) (260) (896)
Radios 16 872 10 546 4 312 1 21 1,144(18) (974) (9) (498) (3) (247) (8) (16) (872)
Mast 4 121 1 38 1 40 – 4 128(4) (114) (1) (38) (1) (38) (–) (4) (121)
Antena 7 27 – – 1 4 – 6 23(9) (34) (–) (–) (2) (11) (–) (7) (27)
Other – – – 3,382 – 1,813 – – –(–) (–) (–) (10) (–) (267) (–) (–) (–)
Total 3521 4,967 3,249(4,123) (3,825) (3,521)
Note: a) Sales of goods in Project Division comprise of large number of items of different nature and specifications and henceit is not practicable to furnish information in respect thereof. The cost of such sales has been included under materialsconsumed.
i) Figures in bracket are for previous year.
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b) Materials ConsumedThese comprise miscellaneous items meant for execution of projects. Since these items are of different nature andspecifications, it is not practicable to disclose the quantitative information in respect thereof.
c) Imported and indigenous materials consumedRs in ‘000 Percentage
2006-07 2005-06 2006-07 2005-06
A) Imported * 462,148 498,639 7.83 11.02B) Indigenous 5,442,039 4,027,603 92.17 88.98
5,904,187 4,526,242 100.00 100.00* excluding Material consumed at overseas branches
31. Supplementary statutory information:a. Directors remuneration
2006-07 2005-06Rs. in ‘000 Rs. In ‘000
Salaries 10,229 15,940Commission (including Rs Nil (Previous year Rs 4,318 thousand) 14,000 7,614relating to previous year) *Perquisites (excluding the value of non-monetary perquisites) 17 666Contribution to Superannuation fund 639 981Contribution to Provident fund 528 789
25,413 25,990* Included Rs 10,000 thousand payable to the Chairman is subject to Shareholder approval.Note: As the future liability for gratuity and leave encashment is provided on an actuarial basis for the Company as a whole,the amount pertaining to the directors is not ascertainable and therefore not included above.
b. Computation of net profit in accordance with Section 349 of the Companies Act, 1956 for calculation of commissionpayable to directors
2006-07 2005-06Rs. in ‘000 Rs. in ‘000
Profit before tax as per Profit & Loss Account 973,332 562,919Add: Directors Remuneration 25,413 25,990
Directors’ sitting fees 180 190Provision for diminution in the value of Investments – 210
Less: Profit on sale of Non Trade Long Term Investments 25,358 47,739Profit on sale of Fixed Assets 23,010 11,115Profit on Liquidation of Subsidiary 13,956 –
Net Profit for the year in accordance with Sections 198 & 349 of the Companies Act 936,601 530,445Commission payable @ 0.5% to 2% and subject to individual ceiling attached,on prorata basis. 14,000 3,296
c. Earnings in foreign currency (Accrual basis)2006-07 2005-06
Rs. In ‘000 Rs. In ‘000Management Fees 11,355 47,318Hiring Charges 30,021 -Exports at F.O.B. Value (including foreign branches Rs 210 thousand(Previous year Rs Nil)) 4,380 543
Interest Received (including foreign branches Rs 25,897 thousand
(Previous year Rs Nil)) 157,819 11,239
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2006-07 2005-06Rs. In ‘000 Rs. In ‘000
Insurance Claims (including foreign branches Rs 22,345 thousand(Previous year Rs 38,263 thousand)) 22,345 38,263
Sale of Stores, Spares and consumables (including foreign branchesRs Nil (Previous year Rs 6,048 thousand)) – 6,048
Contract Revenue (including foreign branches Rs. 6,034,534 thousand(Previous year Rs. 4,245,165 thousand)) 7,564,061 5,010,012
Others (including foreign branches Rs 8,895 (Previous year Rs 13,635 thousand)) 8,895 13,635
7,798,876 5,127,058
d. Expenditure in foreign currency
2006-07 2005-06
Rs. in ‘000 Rs. In ‘000
Travelling * 31,017 27,166
Project Expenses* 397,476 323,659
Bandwidth Charges* 75,994 35,602
Foreign Branch Expenses 5,498,734 3,679,529
Interest 1,441 3,132
Others * (Including Rs. 93,295 thousand (Previous year Rs. Nil) 211,167 22,756adjusted against securities Premium Account)
*On cash basis 6,215,829 4,091,844
e. Value of imports calculated on CIF basis *
2006-07 2005-06
Rs. in ‘000 Rs. In ‘000
a) Stores, spares and other materials 493,463 485,354
b) Capital goods 1,896,449 445,811
2,389,912 931,165
* excluding foreign branches
f. Net dividend remitted in foreign exchange
2006-07 2005-06Year to which it relates 01-Apr-05 01-Apr-04
to 31-Mar-06 to 31-Mar-05
Number of non-resident shareholders 1 2
Number of equity shares held on which dividend was due 15,207,926 10,158,826
Amount remitted in Rs. (‘000) (US $ 334,556.31 (Previous year US $ 168,415.55)) 15,208 7,619
32. Previous year’s figures have been regrouped where necessary to conform to this year’s classification.
As per our report of even date For and on behalf of the Board of Directors of
S. R. BATLIBOI & CO. PUNJ LLOYD LIMITEDChartered Accountantsper Raj Agrawal V.K. Kaushik Atul PunjPartner Managing Director ChairmanMembership No. 82028
Dinesh Thairani Raju Kaul Ravi KeswaniPlace : Gurgaon Company Secretary Executive ExecutiveDate : May 31, 2007 Vice President Vice President
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CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2007(Amount IN INR ‘000)
Year ended Year ended March 31, 2007 March 31, 2006
A Cash Flow from Operating activitiesProfit before Tax 973,331 562,919Adjustment for -Depreciation/Amortization (including goodwill) 844,605 591,900(Profit) on Sale of Fixed Assets (Net) (23,010) (11,115)(Profit) on Sale of non trade Long Term Investments (25,358) (47,758)(Profit) on Liquidation of Subsidiaries (Net) (13,956)Interest Income (182,297) (54,461)Dividend on Long Term Investments (289) (6,085)Diminution in Value of Long Term Investments – 210Foreign Exchange Fluctuation (Net) (158,374) (15,354)Interest Expense 692,421 467,993Bad debts/ advances written off / Liabilities written back(Net) (43,645) (32,645)Provision for doubtful receivable (Net) 80,292 –Operating Profit before working capital changes 2,143,720 1,455,604Movement in working capital(Increase) in Inventories (3,527,154) (2,294,428)(Increase) in Sundry Debtors (2,330,656) (659,058)(Increase) in Other Current Assets (478,031) (43,738)(Increase) in Loans and Advances (4,760,748) (453,407)Increase in Current Liabilities and Provisions 7,472,274 1,370,742Cash used in operations (1,480,595) (624,285)Direct tax paid (including Fringe Benefit Tax Rs.29,970 thousand (Previous year Rs. 10,000 thousand)) (339,057) (232,659)Net cash used in operating activities (1,819657) (856,944)
B Cash flow from investing activitiesPurchase of Fixed Assets (4,123,423) (1,820,316)Purchase of Investments (2,015,643) (718,730)Proceeds from sale of Investments 121,069 70,776Proceeds from sale of Fixed Assets 120,472 240,891Dividend received 289 6,085Interest received 260,102 41,365Net cash used in investing activities (5,637,134) (2,179,929)
C Cash flows from financing activitiesIncrease in Share Capital 323 83,552Increase in Premium on issue of Share Capital 19,983 5,765,070Share issue expenses (98,149) (305,097)Increase in Short term working captial loans (Net) 2,444,058 555,639Proceeds from long-term borrowings 10,242,165 929,227Redemption of Debentures - (12,120)Repayment of long-term borrowings (1,483,231) (3,011,252)Interest paid (680,894) (469,170)Dividend paid (52,220) (14,863)Taxes on Dividend paid (7,324) (3,374)Net cash from financing activities 10,384,711 3,462,612
Net increase in cash and cash equivalents (A+B+C) 2,927,923 425,739Exchange fluctuation translation (109,329) 18,822Cash and cash equivalents at the beginning of the year 747,952 303,391Cash out flow due to Dispotal of Singapure Branch (406,197) –Cash and cash equivalents at the end of the year 3,379,007 747,952Components of Cash and Cash equivalentsCash On Hand (including Cheque on hand Rs. 7,500 thousand (Previous year Rs.5,024 thousand )) 29,514 16,160Balance with Scheduled BanksOn Current Accounts 285,698 102,777On Cash Credit Accounts 166,092 15,193On EEFC Accounts 374,023 2,100On Fixed Deposits 2,036,905 14,885Balances with Non Scheduled BanksOn Current Accounts 297,642 583,157Onfixed Deposits 189,133 13,680
3,379,007 747,952NOTES:1 The Cash Flow Statement has been prepared under indirect method as set out in Accounting Standard-3 on Cash Flow Statements issued by the Institute of
Chartered Accountants of India.2 Negative figures have been shown in brackets .As per our Report of even date For and on behalf of the Board of Directors ofS. R. BATLIBOI & CO. PUNJ LLOYD LIMITEDChartered Accountantsper Raj Agrawal V.K. Kaushik Atul PunjPartner Managing Director ChairmanMembership No. 82028
Dinesh Thairani Raju Kaul Ravi KeswaniPlace : Gurgaon Company Secretary Executive ExecutiveDate : May 31, 2007 Vice President Vice President
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INFORMATION PURSUANT TO PART IV OF SCHEDULE VI OF COMPANIES ACT, 1956
I. Registration Details
Registration No. : 3 3 3 1 4 State Code : 5 5
Balance Sheet Date : 3 1 0 3 0 7
Date Month Year
II. Capital raised during the year (Rupees in thousand)Public Issue Rights Issue
323 NIL
Bonus Issue Private Placement
NIL NIL
III. Position of Mobilisation and Deployment of Funds (Rupees in thousand)
Total Liabilities Total Assets
26,834,548 26,834,548
Sources of Funds : Paid-up Capital Total Reserves & Surplus
522,521 10,519,670
Secured Loans Unsecured Loans
9,431,416 5,754,983
Deferred Tax Liability
605,958
Application of Funds : Net Fixed Assets Capital Work in Progress
8,512,212 40,336
Investments Net Current Assets
3,177,973 15,104,027
Misc. Expenditure
NIL
IV. Performance of Company (Rupees in thousand)
Turnover Total Expenditure
23,054,778 22,081,447
Profit/(Loss) Before Tax Profit/(Loss) After Taxand Extraordinary items and Extraordinary items
973,331 615,846
Basic Earning Per Share (Rs.) Dividend Rate (%)
2.36 15
V. Generic Name of Three Principal Products/Services of Company as per monetary termsItem Code No. I.T.C. CodeProduct Description Construction, project related activities & engineering services and
internet services
For and on behalf of the Board of Directors
Dinesh Thairani Raju Kaul Ravi Keswani V.K. Kaushik Atul PunjCompany Secretary Executive Vice President Executive Vice President Managing Director Chairman
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1. We have audited the attached consolidated Balance Sheetof Punj Lloyd Limited (the “Company”), its subsidiaries,joint ventures and associates (collectively, the “Punj LloydGroup”) as at March 31, 2007, the consolidated Profit andLoss Account and the consolidated Cash Flow Statementfor the year ended on that date. These consolidatedfinancial statements are the responsibility of theCompany’s management and have been prepared by themanagement on the basis of separate financial statementsand other financial information regarding components. Ourresponsibility is to express an opinion on theseconsolidated financial statements based on our audit.
2. We conducted our audit in accordance with auditingstandards generally accepted in India. Those Standardsrequire that we plan and perform the audit to obtainreasonable assurance about whether the financialstatements are free of material misstatement. An auditincludes examining, on a test basis, evidence supportingthe amounts and disclosures in the financial statements.An audit also includes assessing the accounting principlesused and significant estimates made by management, aswell as evaluating the overall financial statementpresentation. We believe that our audit provides areasonable basis for our opinion.
3. We report that the consolidated financial statements havebeen prepared by the Company’s management inaccordance with the requirements of Accounting Standard(AS) 21 ‘Consolidated Financial Statements’, AccountingStandard (AS) 23 ‘Accounting for Investments inAssociates in Consolidated Financial Statements’ andAccounting Standard (AS) 27 ‘Financial Reporting ofInterests in Joint Ventures’, issued by the Institute ofChartered Accountants of India.
4. We did not audit the financial statements of certainsubsidiaries of the Company, whose financial statementsreflect total assets of Rs. 25,909,154 thousand as at March31, 2007, total revenues of Rs 29,798,941 thousand andcash flows amounting to Rs. 55,452,178 thousand for theyear then ended. We also did not audit the financialstatements of certain joint ventures of the Company, whosefinancial statements reflect, to the extent of theproportionate share of the Punj Lloyd Group, total assetsof Rs. 790,307 thousand as at March 31, 2007, totalrevenues of Rs. 52,968 thousand and cash flowsamounting to Rs. 6,458 thousand for the year then ended.
The financial statements and other financial informationof these subsidiaries and joint ventures have been auditedby other auditors, whose reports have been furnished tous, and our opinion, insofar as it relates to the amountsincluded in respect of these subsidiaries and jointventures, is based solely on the reports of the otherauditors.
5. Without qualifying our opinion, we draw attention to Note6 in Schedule ‘O’ to the consolidated financial statementsregarding deductions made/ amounts withheld by somecustomers aggregating to Rs. 760,671 thousand (previousyear Rs.766,322 thousand) on various accounts whichare being carried as sundry debtors. The Company isalso carrying Work-in-Progress inventory of Rs 64,000thousand (previous year Rs. 64,000 thousand) relating toone of these cases. The ultimate outcome of the abovematters cannot presently be determined although theCompany is of the view that such amounts are recoverableand hence no provision is required there against.
6. Included in sundry debtors is an amount of Rs. 292,671thousand (previous year Rs. 301,016 thousand) relatedto contract work with Spie Capag- Petrofac InternationalLimited (SCPIL) in Georgia. Additionally, sundry debtorsinclude an amount of Rs. 74,860 thousand (previous yearRs. 77,000 thousand) from SCPIL for expenses incurredon behalf of SCPIL. Further, as stated in Note 7 inSchedule O to the financial statements, the terms of therelated contract are currently in dispute. Accordingly, weare unable to satisfy ourselves as to the recoverability ofthe sundry debtors amounting to Rs. 367,531 thousand(previous year Rs. 378,016 thousand)
Also, as stated in Note 7 in Schedule ‘O’ to the financialstatements, the Company has raised variation orders ofRs. 1,448,892 thousand (previous year Rs. 1,490,000thousand) on SCPIL and SCPIL has raised debit notes ofRs. 464,166 thousand (previous year Rs. 477,400thousand) on the Company. These variation orders anddebit notes are being disputed and have not been agreedbetween the Company and SCPIL. However, the ultimateoutcome of the dispute cannot presently be determinedby the Company. Because of the significance of this matter,we do not express an opinion on the impact of the aboveuncertainty on the consolidated financial statements. Ourprevious year audit report was also qualified in respect ofthe same matter.
AUDITORS’ REPORT TO THE BOARD OF DIRECTORS OF PUNJ LLOYD LIMITED ON THECONSOLIDATED FINANCIAL STATEMENTS OF PUNJ LLOYD LIMITED, ITS SUBSIDIARIES,JOINT VENTURES AND ASSOCIATES
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Subject to our comments in paragraph 6 above, and basedon our audit and on consideration of report of otherauditors on separate financial statements and on otherfinancial information of the components, and to the bestof our information and according to the explanations givento us, we are of the opinion that the attached consolidatedfinancial statements of the Punj Lloyd Group give a trueand fair view in conformity with the accounting principlesgenerally accepted in India:
(a) in the case of the Consolidated Balance Sheet, ofthe state of affairs of the Punj Lloyd Group as atMarch 31, 2007;
(b) in the case of the Consolidated Profit and Loss
Account, of the profit of the Punj Lloyd Group for theyear then ended; and
(c) in the case of the Consolidated Cash FlowStatement, of the cash flows of the Punj Lloyd Groupfor the year then ended.
S. R. Batliboi & Co.Chartered Accountants
per Raj AgrawalPartnerMembership No: 82028
Place : Gurgaon
Date : May 31, 2007
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CONSOLIDATED BALANCE SHEET AS AT MARCH 31, 2007
(Amount in INR ’000)Schedules As at As at
March 31, 2007 March 31, 2006
SOURCES OF FUNDS
Shareholders fundsShare capital A 522,521 522,198Reserves & surplus B 12,266,566 10,693,102
12,789,087 11,215,300Minority interest 58,569 9,200
Loan funds CSecured loans 11,231,857 4,920,910Unsecured loans 5,760,227 643,880
16,992,084 5,564,790Deferred tax liability 683,216 606,532(Refer note 19 in Schedule ‘O’)Total 30,522,956 17,395,822
APPLICATION OF FUNDSFixed assets D
Gross block 18,669,499 9,069,623Less : Accumulated depreciation & amortisation 6,197,975 3,279,763Net block 12,471,524 5,789,860
Capital work-in-progress including capital advances 709,984 1,230,222Preoperative expenditure (pending allocation) E 147,928 13,329,436 155,814 7,175,896Investments F 1,698,474 415,615Deferred tax asset 322,326 456(Refer note 19 in Schedule ‘O’)Current assets, loans and advances G
Inventories 15,016,674 8,042,764Sundry debtors 12,233,876 3,944,114Cash and bank balances 10,026,796 1,121,647Other current assets 510,574 191,630Loans and advances 4,461,774 2,179,040
42,249,694 15,479,195Less: Current liabilities and provisions H
Current liabilities 25,430,336 5,387,108Provisions 1,646,889 288,483
27,077,225 5,675,591Net current assets 15,172,469 9,803,604Miscellaneous expenditure I 251 251(To the extent not written off or adjusted)Total 30,522,956 17,395,822
Significant accounting policies & notes to Oconsolidated accountsThe Schedules referred to above form an integral part of the Consolidated Balance SheetAs per our report of even date For and on behalf of the Board of Directors ofS. R. BATLIBOI & CO. PUNJ LLOYD LIMITEDChartered Accountantsper Raj Agrawal V.K. Kaushik Atul PunjPartner Managing Director ChairmanMembership No. 82028
Dinesh Thairani Raju Kaul Ravi KeswaniPlace : Gurgaon Company Secretary Executive ExecutiveDate : May 31, 2007 Vice President Vice President
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 105 |
CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31, 2007
(Amount in INR ’000)
Schedules Year ended Year ended March 31, 2007 March 31, 2006
INCOMESales & contracts revenue J 51,265,783 16,846,459Other income K 793,706 317,239Profit on sale of investment in an associate – 2,185
52,059,489 17,165,883EXPENDITUREMaterials consumed and cost of goods sold L 16,372,752 5,515,887Operating and administrative expenses M 30,790,233 9,421,237Financial charges N 1,185,075 794,063Depreciation/amortization 1,089,133 633,397
Less : Transfer from revaluation reserve (27,627) (29,697)
1,061,506 603,700
49,409,566 16,334,887
Profit before tax 2,649,923 830,996
Provision for tax– Current tax 510,941 289,498– Deferred tax charge/(Credit) (Previous year 137,098 (13,011)
including credit of Rs. 34,506 thousand for 41,563 14,985earlier years)
– Fringe benefit taxTotal tax expense 689,602 291,472Profit after tax 1,960,321 539,524Add : Share in profits of associates (Net) 9,668 7,754Profit before minority’s share 1,969,989 547,278Add : Share of loss transferred to minority 2,712 7,340Less : Preacquisition profits adjusted against goodwill (3,435) –Profit for the year 1,969,266 554,618Balance brought forward from previous year 2,430,294 1,912,600Transfer from debenture redemption reserve – 50,120Transfer from foreign project utilized reserve 22,500 12,500Profit available for appropriations 4,422,060 2,529,838AppropriationsTransferred to general reserve 75,000 40,000Proposed dividend 78,378 52,220Tax on proposed dividend 13,320 7,324
166,698 99,544Surplus carried to Balance Sheet 4,255,362 2,430,294Earning per share (nominal value per share Rs. 2)Basic (in Rupees) 7.54 2.55Diluted (in Rupees) (refer note 14 of Schedule ‘O’) 7.00 2.41
Significant accounting policies & notes to Oconsolidated accountsThe Schedules referred to above form an integral part of the Consolidated Profit and Loss AccountAs per our report of even date For and on behalf of the Board of Directors ofS. R. BATLIBOI & CO. PUNJ LLOYD LIMITEDChartered Accountantsper Raj Agrawal V.K. Kaushik Atul PunjPartner Managing Director ChairmanMembership No. 82028
Dinesh Thairani Raju Kaul Ravi KeswaniPlace : Gurgaon Company Secretary Executive ExecutiveDate : May 31, 2007 Vice President Vice President
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(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE A : SHARE CAPITALAUTHORISED350,000,000 equity shares of Rs. 2 each (Previousyear 60,000,000 equity shares of Rs. 10 each) 700,000 600,00010,000,000 (Previous year 20,000,000) PreferenceShares of Rs. 10 each 100,000 200,000
800,000 800,000ISSUED, SUBSCRIBED AND PAID UP261,260,335 fully paid up equity shares of Rs. 2 each(Previous year 52,219,836 Equity Shares of Rs. 10 each) 522,521 522,198OF THE ABOVEi) 136,700 equity shares of Rs. 10 each were allotted as fully
paid up pursuant to a contract for consideration other thancash.
ii) 28,615,239 equity shares of Rs. 10 each were allotted asfully paid up bonus shares by capitalisation of profits.
iii) During the previous year, the Company had converted917,928 zero percent convertible preference shares ofRs. 10 each into 3,098,296 equity shares of Rs. 10 each.
iv) The Company has sub-divided nominal value of its equityshares from Rs. 10 each to Rs. 2 each on March 6, 2007.Consequently, the number of authorised equity shares haveincreased from 70,000,000 to 350,000,000 and the issued,subscribed and paid up equity shares have increased from52,252,067 to 261,260,335.(Also refer Note 17 of Schedule ‘O’)
TOTAL 522,521 522,198
SCHEDULE B : RESERVES & SURPLUSCAPITAL RESERVEBalance as per last account 10,326 15,444Less: Adjustment on divestment of stake in an associate – 10,326 5,118 10,326SECURITIES PREMIUM ACCOUNTBalance as per last account 7,977,340 2,539,174Additions during the year 19,983 5,765,070
7,997,323 8,304,244Less : Utilised during the yearIssue of zero coupon foreign currency convertible bonds 98,149 –Conversion of preference shares – 21,807Share issue expenses – 305,097
7,899,174 7,977,340ASSET REVALUATION RESERVEBalance as per last account 85,349 122,529Less:Adjustment on account of depreciation on revalued
amount of assets 27,627 29,697Less:Adjustment on account of sale/disposal of revalued
assets – 7,48357,722 85,349
GENERAL RESERVEBalance as per last account 68,548 193,040Add : Transfer from Profit and Loss Account 75,000 40,000Less: Utilised during the year – 164,492
143,548 68,548FOREIGN PROJECT UTILIZED RESERVEBalance as per last account 92,500 105,000Less : Transfer to Profit and Loss Account 22,500 12,500
70,000 92,500
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
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SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
(Amount in INR ’000)As at As at
March 31,2007 March 31, 2006SCHEDULE B : RESERVES & SURPLUS (CONTINUED)DEBENTURE REDEMPTION RESERVEBalance as per last account – 50,120Less : Transfer to Profit and Loss Account – 50,120
– –FOREIGN CURRENCY TRANSLATION RESERVE (169,566) 28,745PROFIT AND LOSS ACCOUNT BALANCE 4,255,362 2,430,294
TOTAL 12,266,566 10,693,102
SCHEDULE C : LOAN FUNDSSECURED LOANS:A) SHORT TERM WORKING CAPITAL LOANSFROM BANKS 5,728,240 3,101,188Out of the above.i) Rs. 124,546 thousand is secured by way of first charge on
pari passu basis on current assets (excluding receivables)and second charge on pari passu basis on movable fixedassets of the project division of the Company and furthersecured by personal guarantee of Chairman of the Company.
ii) Rs. 975,037 thousand is secured by way of first charge onpari passu basis on current assets (excluding receivables)and second charge on pari passu basis on fixed assets ofthe project division of the Company.
iii) Rs. 562,217 thousand is secured by way of exclusivecharge on the receivables of the specific projects financedby the respective banks, first pari passu charge on thecurrent assets of the project division (excluding receivables)and pari passu second charge on the movable fixed assetsof the project division of the Company and further securedby personal guarantee of Chairman of the Company.
iv) Rs. 2,567,909 thousand is secured by way of exclusivecharge on the receivables of the specific projects financedby the respective banks, first pari passu charge on thecurrent assets of the project division (excludingreceivables), pari passu second charge on the movablefixed assets of the project division of the Company
v) Rs. 494,038 thousand in respect of a foreign subsidiary issecured by lien over the subsidiary’s trade receivables(existing and project specific) and some part of building,land, inventory, machinery and motor vehicles. The loanis further secured by corporate guarantee of the parentCompany and pledge of certain trade receivables,inventories and fixed assets of the subsidiary.
vi) Rs. 452,306 thousand in respect of a foreign subsidiary issecured by hypothecation of equipment and machinery.The loan is further secured by corporate guarantee of theparent company.
vii) Rs.50,260 thousand in respect of an Indian subsidiary issecured by hypothecation by way of charge on inventoriesboth on hand and in transit, book debts, other receivables(both present and future) and charge on all the fixed assetsof the subsidiaries except those acquired under hirepurchase agreements. The loans is further secured bycorporate guarantee of the parent Company.
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(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE C : LOAN FUNDS (CONTINUED)viii) Rs. 13,487 thousand in respect of an Indian subsidiary is
secured by hypothecation of raw-materials, work inprogress, finished goods and sundry debtors of thesubsidiary.
ix) Rs. 117,211 thousand in respect of a foreign subsidiary issecured by indirect assignment of contract receivablesunder a project.
x) Rs. 507 thousand in respect of a joint venture is securedby hypothecation by way of charge on inventories both onhand and in transit, book debts and other receivables (bothpresent and future) of the joint venture. The loan is furthersecured by corporate guarantee foreign joint venturepartner.
xi) Rs. 370,719 thousand in respect of a joint venture issecured by -– tangible and movable properties (including plant and
machinery) both present and future.– annuity revenues and receivables (excluding bonus
for early completion).– All project agreements, all guarnatees, performance
guarantees or bonds, letters of credit, applicablepermits, plant rights, titles, approvals, permits,clearances and interest under the project Agreement.
– intangible assets including but not limited to goodwill.– all bank accounts including Trust and Retention
Account and all monies from time to time depositedtherein and all permitted Investments or othersecurities representing all amounts credited to theTrust and Retention Account.
B) TERM LOANSI) FROM BANKS 4,682,147 1,435,951Out of the above,i) Rs. 1,007,412 thousand is secured by way of exclusive
charge on the equipment purchased out of the proceedsof loan.
ii) Rs. 1,737,974 thousand is secured by way of first paripassu charge on movable fixed assets of the projectdivision of the Company.
iii) Rs. 476,480 thousand is secured by way of first pari passucharge on movable fixed assets of the project division ofthe Company and further secured by personal guaranteeof Chairman of the Company.
iv) Rs. 263,994 thousand is secured by way of exclusivecharge/mortgage by way of deposit of title deeds of theland and building for corporate office at Gurgaon.
v) Rs. 64,602 thousand is secured by way of pari passu firstcharge on the movable fixed assets of the project division ofthe Company, pari passu second charge on current assetsof the project division of the Company (excluding receivablesof the Company) and further secured by personal guaranteeof Chairman of the Company.
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 109 |
(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE C : LOAN FUNDS (CONTINUED)vi) Rs. 79,935 thousand is secured by way of second pari
passu charge on the movable fixed assets of the projectdivision of the Company and further secured by personalguarantee of Chairman of the Company.
vii) Rs. 249,840 thousand is secured by way of pari passufirst charge on the movable fixed assets of the projectdivision of the Company and pari passu second chargeon current assets of the project division of the Company(excluding receivables of the Company).
viii) Rs. 500,000 thousand is secured by way of subservientcharge on the entire current and movable fixed assets ofthe project division of the Company.
ix) Rs. 80,093 thousand in respect of an Indian subsidiary issecured by way of hypothecation of plant and machineryof the subsidiary.
x) Rs. 221,817 thousand in respect of a foreign subsidiary issecured by lien over the subsidiary’s trade receivablesand some part of building, land, inventory, machinery andmotor vehicles. The loan is further secured by corporateguarantee of the parent Company.
II. FROM OTHERS 593,638 61,914Rs. 593,638 thousand is secured by first and exclusivecharge by way of hypothecation on certain specificequipments financed through the loan.
III. HIRE PURCHASE LOANS
FROM OTHERS 213,241 291,842(Secured by exclusive charge by way of hypothecationon certain specific equipments)
IV. EXTERNAL COMMERCIAL BORROWINGSFROM BANK 14,591 30,015(Secured by exclusive charge on the equipment of theCompany financed through the loan.)
TOTAL 11,231,857 4,920,910
UNSECURED LOANS:
i) Short Term Working Capital Loans from Banks 78,388 190,506
ii) Term Loan Account from Banks 240,000 404,775
iii) Intercorporate Deposits 4,164 5,069
iv) External Commercial Borrowings from Banks 13,995 26,203
v) Zero Coupon Foreign Currency Convertible Bonds 5,422,500 –
vi) Other Loans 1,180 17,327
TOTAL 5,760,227 643,880
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
| 110 |
SC
HE
DU
LE
D :
FIX
ED
AS
SE
TS
(Am
ount
in IN
R ’0
00)
Gro
ss B
lock
Acc
um
ula
ted
Dep
reci
atio
n a
nd
Am
ort
isat
ion
Net
Blo
ck
Par
ticul
ars
As
atA
dd
itio
ns
Oth
erD
elet
ion
s/Fo
rex
As
atA
s at
Ad
dit
ion
sF
or
the
Del
etio
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Fore
xA
s at
As
atA
s at
Ap
ril 0
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to a
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itio
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Ad
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arch
31,
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year
Ad
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arch
31,
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ch 3
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31,
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uis
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fm
ents
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st-
2007
2006
uis
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n o
fm
ents
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st-
2007
2007
2006
a su
bsi
dia
rym
ents
a su
bsi
dia
rym
ents
TA
NG
IBL
ES
Lan
d15
9,90
114
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300,
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--
--
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(300
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ildin
gs
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662
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4,18
617
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(2,3
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719,
956
79,5
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15,5
393,
386
(402
)91
,280
628,
676
226,
133
Lea
seh
old
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rove
men
ts3,
460
1,70
9,84
816
,250
3,46
026
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1,75
2,70
03,
460
789,
696
25,2
033,
460
6,87
982
1,77
793
0,92
3-
Pla
nt &
Mac
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ery
7,51
0,60
81,
077,
779
4,53
9,55
864
6,40
8(1
98,6
84)
12,2
82,8
532,
762,
837
937,
982
851,
365
377,
186
(13,
481)
4,16
1,51
78,
121,
336
4,74
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1
Fu
rnit
ure
, Fix
ture
s an
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e E
qu
ipm
ents
476,
699
484,
379
283,
160
57,2
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5,04
7)1,
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182,
121
388,
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(2,4
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613,
170
548,
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294,
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To
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26,5
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19,3
807,
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20,7
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icle
s43
1,95
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269,
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61,8
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8,68
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2,93
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4,66
255
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73,5
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(3,0
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221,
552
611,
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287,
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b T
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(81,
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474,
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(12,
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are
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To
tal A
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9,06
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PR
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212
156,
212
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6,74
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3,27
9,76
35,
789,
860
4,65
1,34
5
a)G
ross
blo
ck o
f Fix
ed A
sset
s in
cude
s R
s. 2
77,3
77 th
ousa
nd (p
revi
ous
year
Rs.
313
,685
thou
sand
) on
acco
unt o
f rev
alua
tion
of a
sset
s ca
rrie
d ou
t in
earli
er y
ears
. Con
sequ
ent t
o th
e sa
id re
valu
atio
n, th
ere
is a
n ad
ditio
nal c
harg
e of
depr
ecia
tion
of R
s. 2
7,62
7 th
ousa
nd (p
revi
ous
year
Rs.
29,
697
thou
sand
) and
an
equi
vale
nt a
mou
nt h
as b
een
with
draw
n fr
om re
valu
atio
n re
serv
e an
d cr
edite
d to
Pro
fit a
nd L
oss
Acc
ount
.
b)P
lant
and
mac
hine
ry o
f the
cos
t of R
s. 2
69,3
39 th
ousa
nd (p
revi
ous
year
Rs.
359,
207
thou
sand
) are
acq
uire
d on
hire
pur
chas
e ba
sis.
Acc
umul
ated
dep
reci
atio
n th
ereo
n is
Rs.
34,7
92 th
ousa
nd (p
revi
ous
year
Rs.
38,0
34 th
ousa
nd).
c)D
elet
ion
from
pla
nt a
nd m
achi
nery
incl
udes
Rs.
20,
239
thou
sand
(pre
viou
s ye
ar a
dditi
on R
s. 9
58 th
ousa
nd) b
eing
dec
reas
e in
the
Rup
ee li
abilt
y in
resp
ect o
f for
eign
cur
renc
y lo
an.
d)C
apita
l wor
k in
pro
gres
s in
clud
es c
apita
l adv
ance
s R
s. 1
1,87
0 th
ousa
nd (p
revi
ous
year
Rs.
368
,186
thou
sand
).
e)G
ross
blo
ck o
f ass
ets
incl
udes
Rs.
69,
319
thou
sand
(pre
viou
s ye
ar R
s. 1
46,8
97 th
ousa
nd) (
writ
ten
dow
n va
lue
Rs.
16,
386
thou
sand
(pre
viou
s ye
ar R
s.52
,913
thou
sand
)) jo
intly
hel
d w
ith o
ther
s in
resp
ect o
f an
unin
corp
orat
ed J
oint
Ven
ture
.
f)P
ursu
ant t
o th
e m
erge
r of I
SP
div
isio
n, la
nd a
nd b
uild
ings
of R
s.88
,670
thou
sand
(gro
ss b
lock
) (pr
evio
us y
ear R
s. 8
8,67
0 th
ousa
nd) a
re v
este
d in
the
Com
pany
, whi
ch a
re y
et to
be
regi
ster
ed in
the
nam
e of
the
Com
pany
.
g)La
nd in
clud
es le
aseh
old
land
Rs.
196
,657
thou
sand
(pre
viou
s ye
ar R
s.54
,702
thou
sand
).
h)F
urni
ture
fixt
ure
and
offic
e eq
uipm
ents
incl
ude
Rs.
17,
426
thou
sand
s gi
ven
on le
ase
(pre
viou
s ye
ar R
s. N
il), A
ccum
ulat
ed d
epre
ciat
ion
ther
e on
is R
s. 1
1,56
7 th
ousa
nd (p
revi
ous
year
Rs.
Nil)
. Dep
reci
atio
n fo
r the
yea
r on
Fur
nitu
re,
Fix
ture
and
offi
ce e
quip
men
ts in
clud
es R
s.2,
119
thou
sand
(pre
viou
s ye
ar R
s. N
il) o
n ac
coun
t of a
sset
s gi
ven
on le
ase.
i)P
lant
and
Mac
hine
ry in
clud
es a
sset
s gi
ven
unde
r lea
se to
cab
le o
pera
tors
am
ount
ing
to R
s. 3
2,15
3 th
ousa
nd (p
revi
ous
year
Rs.
32,
153
thou
sand
) on
orig
inal
cos
t. A
ccum
ulat
ed d
epre
ciat
ion
ther
e on
is R
s. 2
0,43
0 th
ousa
nd (p
revi
ous
year
Rs.
17,
187
thou
sand
). D
epre
ciat
ion
for t
he y
ear o
n P
lant
and
Mac
hine
ry in
clud
es R
s. 3
,215
thou
sand
(pre
viou
s ye
ar R
s. 3
,215
thou
sand
) on
acco
unt o
f ass
ets
give
n on
leas
e.
j)D
elet
ion
from
gro
ss b
lock
and
acc
umul
ated
dep
reci
atio
n in
clud
e R
s. 3
,107
thou
sand
and
Rs.
2,05
9 re
spec
tivel
y, o
n ac
coun
t of d
ives
tmen
t of s
take
in a
sub
sidi
ary
and
adju
stm
ent o
n w
indi
ng u
p of
cer
tain
sub
sidi
arie
s du
ring
the
year
.
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 111 |
(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE : E PREOPERATIVE EXPENDITURE(PENDING ALLOCATION)Opening Balance 155,814 98,426Add: Expenditure incurred during the yearPower and Fuel 209 8Hire Charges 77 41Repair & Maintenance- Others 1,303 4Salaries, Wages and Bonus 1,918 4,145Contribution to Provident & Other Funds – 7Workmen and Staff Welfare 165 93Supervision Expenses 1,010 992Fees & Taxes 647 66Travelling and Conveyance 68 7Insurance 2,738 1,474Consultancy / Professional Charges 1,491 71Project Management Fees 4,009 3,941Other Expenses 327 2,790Interest on Term Loans 37,997 42,410Bank / Financial Charges 11,768 1,344Less:Interest Income (147) 63,580 (5) 57,388
219,394 155,814Less: Transferred To Fixed Assets 71,466 –Balance Carried Forward 147,928 155,814
SCHEDULE F : INVESTMENTS
LONG TERM
QUOTED (NON TRADE)
JCT ELECTRONICS LTD. 13 13600 (Previous year 600) Equity Shares of Rs. 10 each, fully paid up.CONTINENTAL CONSTRUCTION LTD. 34 343,000 (Previous year 3,000) Equity Shares of Rs. 10 each,fully paid up.MAX INDIA LTD. 9 92500 (Previous year 500) Equity Shares of Rs. 2 (Previousyear Rs 10) each, fully paid up.KIRLOSKAR PNEUMATICS CO LTD. 20 201,000 (Previous year 1,000) Equity Shares of Rs. 10 each,fully paid up.DAEWOO MOTORS INDIA LTD. 367 36611,000 (Previous year 11,000) Equity Shares of Rs. 10 each,fully paid upHINDUSTAN OIL EXPLORATION CO. LTD. 307 1906,133 (Previous year 4,600) Equity Shares of Rs. 10 each,fully paid up.
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
| 112 |
(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE F : INVESTMENTS (CONTD.)PANASONIC BATTERIES INDIA COMPANY LTD. 45 45(formerly Matsushita Lakhanpal Battery India Limited) 1,300(Previous year 1,300) Equity Share of Rs. 10 each, fully paid up.BERGER PAINTS LTD. 963 2,88861,600 (Previous year 115,500) Equity Shares of Rs. 2 eachfully paid up. (Including 23,100 equity shares received byway of bonus shares)TRITON CORPORATION LTD. (Formerly Stencil ApparelBrands Ltd.) 60 606,000 (Previous year 6,000) Equity Shares of Rs. 10 each,fully paid up.UNQUOTED (TRADE)RAJAHMUNDRY EXPRESSWAY LTD. 40,689 40,6893,697,500 (Previous year 3,697,500) Equity Shares of Rs. 10each, fully paid upOf the above,1,885,000 (Previous year 1,885,000) Shares arepledged with a bank.ANDHRA EXPRESSWAY LTD. 42,820 42,8203,697,500 (Previous year 3,697,500) Equity Shares of Rs. 10each, fully paid upOf the above, 1,885,000 (Previous year 1,885,000) shares arepledged with a bank.NORTH KARNATAKA EXPRESSWAY LIMITED 75,724 75,7247,572,400 (Previous year 7,572,400) Equity Shares of Rs.10each, fully paid up.UNQUOTED (NON-TRADE)RFB LATEX LTD. 5,200 5,200200,000 (Previous year 200,000) Equity Shares of Rs.10 each,fully paid up.BRIDGE CAPITAL REALITY 43,561 –267 (Previous year Nil) Equity Shares of SGD 6000 each,full paid upSEMBAWANG HUANQIU ENGINEERING CO., LTD. 40,285 –316,556 (previous year Nil) Equity shares of RMB 10 eachfully paid upTHAI INDUSTRIAL ESTATE CORPORATION LTD. 39,306 –430,000 (previous year Nil) Equity shares of THB 100 eachfully paid upAROOSHI ENTERPRISES (P) LTD. 5,985 5,985598,500 (Previous year 598,500) Equity Shares of Rs. 10each, fully paid up.GLOBAL HEALTH PRIVATE LTD. 1,380,000 200,0008,000,000 (Previous year 8,000,000) Equity Shares of Rs. 10each, fully paid up (Previous year Rs 1.45 paid up per share.)INVESTMENTS IN ASSOCIATESUNQUOTED (TRADE)BISTRO HOSPITALITY (P) LTD. – 28,782Nil (Previous year 2,878,200) Equity Shares of Rs.10 eachfully paid upAdd: Share in opening accumulated profits 12,562 5,361Add: Share in profits for current year 1,795 7,858Less: Profits attributable to stake sold during the year (14,357) (657)
– 41,344
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 113 |
(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE F : INVESTMENTS (CONTD.)
JACOB BALLAS CAPITAL INDIA (P) LTD. – –Nil (Previous year 1,900,000) Equity Shares of Rs.10 each,fully paid up
Add: Share in opening accumulated profits – 26,986Add: Share in profits/(loss) for current year – –Less: Profits attributable to stake sold during the year – (26,986)
– –CITY VISION (P) LTD. 823 82341,160 (previous year 41,160) Equity Shares of Rs. 10 each,fully paid up.
Less : Share in opening accumulated losses (823) (823)– –
SHITUL ENGINEERING (P) LTD. 785 7857,850 (previous year 7,850) Equity Shares of Rs. 100 each,fully paid up
Less : Share in opening accumulated profits/(losses) (119) (18)Less : Share in profits/(losses) for the current year (35) (101)
631 666SATELLITE VISION (P) LTD. * 3,750 3,750150,000 (Previous year 150,000) Equity Shares of Rs.10each, fully paid up.
GAITRY CABLE NETWORK PVT. LTD. * 49 494,900 (Previous year 4,900) Equity Shares of Rs. 10 each,fully paid up.
SUNSTAR NETWORK & TECHNOLOGIES LTD. 2,530 2,53010,159 (Previous year 10,159) Equity Shares of Rs. 10each, fully paid up.
Less : Share in opening accumulated profits/(losses) (2,530) (2,530)– –
DOTCOM HOLDINGS (P) LTD. 49 494,900 (previous year 4,900) Equity Shares of Rs. 10 each,fully paid up
Less : Share in opening accumulated losses (37) (34)Less : Share in losses for the current year (4) (3)
8 12RELIANCE CONTRACTORS PRIVATE LTD. 66,265 –15,000 (Previous year Nil) Equity shares of SGD 1 each,fully paid upLess : Share in opening accumulated losses (66,265) –Less : Share in profits/(losses) for the current year – –VENTURA DEVELOPMENTS (MYANMAR) PTE LTD. 994 –35,000 (Previous year Nil) equity shares of SGD 1 each,fully paid up.Less : Share in opening accumulated losses (994) –Less : Share in profits/(losses) for the current year – –VENTURA DEVELOPMENTS (SURABAYAA) PTE LTD. 39,746 –1,400,000 (Previous year Nil) equity shares of SGD 1 each,Fully paid upLess : Share in opening accumulated losses (39,746) –Less : Share in profits/(losses) for the current year – –
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
| 114 |
(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE F : INVESTMENTS (CONTD.)REALAND PTE LTD. 23,455 –798,000 (Previous year Nil) equity shares of SGD 1 eachfully paid upLess : Share in opening accumulated losses (23,455) –Add : Share in profits/(losses) for the current year 7,911 –Add : Foreign currency translation differences (142) –
7,769 –RECO SIN HAN PTE LTD. 294 –10,000 (Previous year Nil) equity shares of SGD 1 eachfully paid upAdd: Share in opening accumulated profits 14,783 –Add: Share in profits/(losses) for the current year 1 –
15,078 –LESS: DIMINUTION IN THE VALUE OF INVESTMENTS (4,199) (4,249)TOTAL 1,698,474 415,615a) Aggregate Cost of Quoted Investments 1417 3,565b) Aggregate Cost of Unquoted Investments 1,697,057 412,050c) Aggregate market value of Quoted Investments 3,890 11,561d) Refer note 13 of schedule ‘O’.* As indicated in Note 1(vii) in Schedule ‘O’, these associates
are not being consolidated in the absence of availability ofaudited financial statements of these entities. Howeverinvestments in both these entities has been fully providedfor as at March 31, 2007
SCHEDULE G : CURRENT ASSETS, LOANS AND ADVANCESA. CURRENT ASSETSi) INVENTORIES:
Raw Materials 6,134 13,293Spares, Stores and Consumables 1,093,416 764,228Scrap 4,479 27,149Stock in Trade (Equipments) 3,249 3,521Work in Progress Projects 13,909,396 7,234,573
15,016,674 8,042,764ii) SUNDRY DEBTORS (Unsecured)
Debts outstanding for a periodExceeding six monthsConsidered Good 5,443,310 1,535,850Considered Doubtful 15,223 57,099Other DebtsConsidered Good 6,790,566 2,408,264
12,249,099 4,001,213Less : Provision for Doubtful Debts 15,223 57,099
12,233,876 3,944,114iii) CASH & BANK BALANCES
a) Cash and Cheques in Hand 39,155 32,156b) Balances with Scheduled Banks
– In Current Accounts 316,850 134,373– In EEFC Accounts 374,023 2,100– In Fixed Deposits 2,075,597 27,120– In Cash Credit Accounts 166,092 15,193
c) Balances with Non-Scheduled Banks– In Current Accounts 1,449,911 874,179– In Fixed Deposits 5,605,168 36,526
10,026,796 1,121,647
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
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(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE G : CURRENT ASSETS, LOANS AND ADVANCES(CONTD.)
iv) OTHER CURRENT ASSETS(unsecured, considered good)a) Interest Receivable 42,633 121,429b) Insurance Claims Receivable 76,035 19,101c) Export Benefit Receivable 387,681 46,875d) Receivable against Sale of Investments 4,225 4,225
(Refer note 11 of schedule ‘O’)
(unsecured, considered doubtful)e) Interest Receivable 80,292
590,866 191,630Less : Provision for doubtful receivable 80,292 –
510,574 191,630B. LOANS AND ADVANCES: (Unsecured, Considered good)
a) Loans to Employees 24,128 2,031b) Intercorporate Deposits 10,726 20,776c) Advances Recoverable in Cash or in kind or for
Value to be Received 2,511,984 1,250,486d) Advances for Proposed Investments 5,701 –e) Deposits 193,356 71,922f) Balances with Customs/Excise Department 318,136 61,981g) Advance Income Tax/Tax Recoverable 978,221 424,035h) VAT / Sales Tax Recoverable 419,522 347,809
4,461,774 2,179,040
TOTAL 42,249,694 15,479,195
SCHEDULE H : CURRENT LIABILITIES AND PROVISIONS
(A) CURRENT LIABILITIESAcceptances 323,433 365,052Sundry Creditors 13,117,304 3,231,392Advance Billings 392,677 243,392Unearned Income 784,253 47,223Security Deposits 153,744 112,126Advances from Clients 9,105,639 1,165,155Interest Accrued but not due on Loans 17,120 5,593Advance against Share Capital from JV Partner 20,150 –Finance lease obligations 507,999 –Other Liabilities 1,008,017 217,175
25,430,336 5,387,108(B) PROVISIONS
For Tax (Net of Taxes Paid) 490,288 176,222For Fringe Benefit Tax (Net of Taxes Paid) 11,020 4,918For Gratuity and Leave Encashment 1,053,883 47,799Proposed Dividend (Including Tax on Dividend) 91,698 59,544
1,646,889 288,483
TOTAL 27,077,225 5,675,591
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
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(Amount in INR ’000)As at As at
March 31, 2007 March 31, 2006SCHEDULE I : MISCELLANEOUS EXPENDITURE(To the extent not written off or adjusted)
Preliminary Expenditure *Balance as per last year 251 251
TOTAL 251 251
* Attributable to certain group entities which are yet tocommence commercial operations
Year ended Year ended March 31, 2007 March 31, 2006
SCHEDULE J : SALES & CONTRACTS REVENUEContracts Revenue (including export benefits of Rs. 417,295thousand (Previous year Rs. 165,502 thousand)) 50,236,899 16,147,489Income from Leased Assets 631 1,854Income from Hire Charges 93,301 89,112Management Services 473 41,825Sales (Net of Discounts)– Exports 2,855 –– Others 541,322 544,177 265,607 265,607Internet Services (Net of Discounts Rs. 541,104thousand, previous year Rs. 592,104 thousand)
390,302 300,572TOTAL 51,265,783 16,846,459
SCHEDULE K : OTHER INCOMERent 29,103 –Interest 306,059 50,187Dividend on Long Term Investments 296 6,093Insurance Claims 26,985 43,301Profit on Sale of Non Trade Long Term Investments 11,000 22,633Profit on Sale of Assets (Net) 12,908 –Profit on Sale of Spares, Stores and Consumables – 6,048Unspent Liabilities & Provisions Written Back 55,523 93,211Bad Debts Recovered 11,809 –Foreign Exchange Fluctuation (Net) 244,636 45,919Others 95,387 49,847
TOTAL 793,706 317,239
SCHEDULE L : MATERIALS CONSUMED AND COST OFGOODS SOLD
Material Consumed 16,342,117 5,490,286Cost of Goods Sold - Equipments
Opening Stock 3,521 4,123Add: Purchases 4,695 1,709
8,216 5,832Less: Closing Stock 3,249 3,521
4,967 2,311Amortisation/Depletion in the Value of Inventory 25,668 23,290
TOTAL 16,372,752 5,515,887
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
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(Amount in INR ’000)Year ended Year ended
March 31, 2007 March 31, 2006SCHEDULE M : OPERATING AND ADMINISTRATIVE
EXPENSES
OPERATINGContractor Charges 13,633,439 3,499,817Site/Connectivity Expenses 819,776 452,249Power and Fuel 1,762,629 608,195Repair and Maintenance– Buildings 12,648 9,141– Plant and Machinary 79,420 42,061– Others 75,525 39,933Freight & Cartage 694,284 404,285Hire Charges 1,846,581 791,555
18,924,302 5,847,236PERSONNELSalaries, Wages and Bonus 5,794,796 1,660,603Contribution to Provident & Other Funds 113,773 80,217Gratuity 9,273 1,136Workmen and Staff Welfare 451,301 120,017
6,369,143 1,861,973ADMINISTRATION AND ESTABLISHMENTBad Debts/Advances Written Off 22,833 63,370Less: Provision made in Previous Year, now Reversed – 8,300
22,833 55,070Rent 246,421 97,118Insurance 591,903 197,185Directors Sitting Fees 9,788 190Travelling and Conveyance 559,863 220,340Fee & Taxes 797,908 226,291Consultancy/Professional Charges 976,875 445,907Commission on Internet Services 7,476 10,487Diminution in the Value of Long Term Investments – 449Provision for Doubtful Debts / Advances / Other current assets 118,848 58,222Loss on Sales of Short Term Investments – 19Loss on Dilution of Stake in Subsidiary 212 –Loss on Sale of Fixed Assets (Net) – 34,641Donations 24,286 14,144Others 2,140,375 341,965
5,496,788 1,712,028
TOTAL 30,790,233 9,421,237
SCHEDULE N : FINANCIAL CHARGES
INTEREST ON:– Term Loans 295,605 295,751– Working Capital Loans 7,004 1,209– Others 522,809 329,735
825,418 626,695
Bank / Financial Charges 359,657 167,368
TOTAL 1,185,075 794,063
SCHEDULES TO THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2007
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SCHEDULE O :A. SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO CONSOLIDATED ACCOUNTS
1. Nature of operations
Punj Lloyd Limited is a Company registered under Indian Companies Act 1956. The Company is primarily engaged inthe business of engineering & construction in the oil & gas sector and infrastructure sector. The Company’s focus oncustomer satisfaction through compliance with the high standards of health, safety and environment, makes it a leadingplayer in the markets in which it operates. The Company also provides broadband services on its optical fiber network.
During the year, the Company has acquired 100% stake in Sembawang Engineering & Constructors Pte Ltd (Formerlyknown as SembCorp Engineers & Constructors Pte Ltd) along with its subsidiaries (including Simon Carves Ltd, UnitedKingdom), Joint Ventures and Associates through its wholly owned subsidiary Punj Lloyd Pte Ltd., Singapore. Theacquisition would enable the Company to acquire pre-qualification in new verticals of infrastructure sectors and EPCcapabilities in Petrochemical domain including LDPE, PVC, Styrene and Refinery Process. The acquisition wouldcement the Company’s presence in South East and Middle East and would give access to new region in Europe.
2. Basis of preparation
The consolidated financial statements have been prepared to comply in all material respects with the mandatoryAccounting Standards issued by the Institute of Chartered Accountants of India (ICAI). The consolidated financialstatements have been prepared under the historical cost convention on an accrual basis except in case of certain fixedassets for which revaluation has been carried out. The accounting policies have been consistently applied by theGroup and are consistent with those used in previous year.
3. Principles of Consolidation
The Consolidated Financial Statements relate to Punj Lloyd Limited (hereinafter referred to as the “Company”) and itssubsidiaries, joint ventures and associates (these group entities and the Company hereinafter collectively referred toas the “Punj Lloyd group”). In the preparation of these Consolidated Financial Statements, investments in Subsidiaries,Associate companies and Joint Venture entities have been accounted for in accordance with AS 21 (ConsolidatedFinancial Statements), AS 23 (Accounting for Investments in Associates in Consolidated Financial Statement) and AS27 (Financial Reporting of Interests in Joint Ventures) issued by the Institute of Chartered Accountants of India. TheConsolidated Financial Statements are prepared on the following basis-
i) Subsidiary companies are consolidated on a line-by-line basis by adding together the book values of the likeitems of assets, liabilities, income and expenses after eliminating all significant intra-group balances and intra-group transactions and also unrealized profits or losses, except where cost cannot be recovered.
ii) Interests in the assets, liabilities, income and expenses of the Joint Ventures are consolidated using proportionateconsolidation method. Intra group balances, transactions and unrealized profits/losses are eliminated to theextent of Company’s proportionate share, except where cost cannot be recovered.
iii) The difference between the cost to the Group of investment in Subsidiaries and Joint Ventures and the proportionateshare in the equity of the investee company as at the date of acquisition of stake is recognized in the consolidatedfinancial statements as Goodwill or Capital Reserve, as the case may be. Goodwill arising on consolidation istested for impairment annually.
iv) Minorities’ interest in net profits of consolidated subsidiaries for the year is identified and adjusted against theincome in order to arrive at the net income attributable to the shareholders of the Company. Their share of netassets is identified and presented in the Consolidated Balance Sheet separately. Where accumulated lossesattributable to the minorities are in excess of their equity, in the absence of the contractual obligation on theminorities, the same is accounted for by the holding company.
v) Investments in Associates are accounted for using the equity method. The excess of cost of investment over theproportionate share in equity of the Associate as at the date of acquisition of stake is identified as Goodwill andincluded in the carrying value of the Investment in the Associate. The carrying amount of the investment isadjusted thereafter for the post acquisition change in the share of net assets of the Associate. However, the shareof losses is accounted for only to the extent of the cost of investment. Subsequent profits of such Associates are notaccounted for unless the accumulated losses (not accounted for by the Group) are recouped. Where the associateprepares and presents consolidated financial statements, such consolidated financial statements of the associateare used for the purpose of equity accounting. In other cases, standalone financial statements of associates areused for the purpose of consolidation.
vi) As far as possible, the consolidated financial statements are prepared using uniform accounting policies for liketransactions and other events in similar circumstances and are presented, to the extent possible, in the same
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manner as the Company’s stand alone financial statements. Differences in accounting policies are disclosedseparately.
vii) The financial statements of the entities used for the purpose of consolidation are drawn up to same reporting dateas that of the Company i.e. year ended March 31, 2007.
4. Use of estimates
The preparation of financial statements in conformity with generally accepted accounting principles requiresmanagement to make estimates and assumptions that affect the reported amounts of assets and liabilities and thedisclosure of contingent liabilities as at the date of the financial statements and reported amounts of revenues andexpenses during the reporting period. Actual results could differ from these estimates.
5. Fixed assets
Fixed assets are stated at cost, (other than some fixed assets which are stated at values as determined by the valuer),less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributablecost of bringing the asset to its working condition for its intended use. Borrowing costs attributable to acquisition /construction of fixed assets are capitalized as per the policy stated in note 8 below.
6. Impairment
The carrying amounts of fixed assets are reviewed at each balance sheet date if there is any indication of impairmentbased on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceedsits recoverable amount. The recoverable amount is the greater of the asset’s net selling price and value in use. Inassessing the value in use, the estimated future cash flows are discounted to their present value at the weightedaverage cost of capital.
7. Depreciation / Amortization
i) In respect of Indian Companies comprised within the group, depreciation on the fixed assets is charged onstraight line method, at the rates specified under Schedule XIV to the Companies Act, 1956, (except to the extentstated in Para ii, iii, iv and viii below), which are based on the useful lives of the assets. In respect of the revaluedassets, the difference between the depreciation calculated on the revalued amount and that calculated on theoriginal cost is recouped from the Revaluation Reserve Account.
ii) Depreciation on the following fixed assets of the Project Division is charged on straight-line method at the rates,based on useful lives of the assets as follows, which are higher than the rates prescribed under Schedule XIV tothe Companies Act, 1956:
Asset Description Depreciation Rate
Plant and machinery 4.75% to 11.31%Vehicles 9.5% to 20%
iii) Depreciation on the following fixed assets of Internet Service division is charged on straight-line method at therates, based on useful lives of the assets as estimated by the management, which are equal to or higher than therates specified under Schedule XIV.
Asset Description Depreciation Rate
Plant and machinery 10%Networking equipment* 10%Office equipment 10%Vehicles 9.5% to 20%
Ducts and optical fiber cables* 4.75%
*Included under Plant & Machinery
iv) Depreciation on the following fixed assets of some foreign branches is charged on straight line method at therates, based on useful lives of the assets as follows, which are higher than the rates prescribed under ScheduleXIV to the Companies Act, 1956:
Asset Description Useful Lives of Assets
Plant and machinery 6 to 25 yearsFurniture and fixtures 3 to 21 yearsOffice Equipments 5 to 6 yearsVehicles 5 to 11 years
v) Amount added to assets on account of foreign exchange fluctuation is depreciated prospectively over the remaininguseful lives of the respective assets.
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vi) No amortization is made for leasehold land, which is under perpetual lease.
vii) Individual assets costing up to Rs 5,000 are depreciated fully in the month of purchase.
viii) Depreciation on the Company’s share in fixed assets of an unincorporated joint venture is provided on straight-line method at the following rates based on their useful lives as estimated by the management of the joint venture.
Asset Description Depreciation Rate
Buildings 10%Plant & Machinery 20%Vehicles 20%Furniture, fixtures & office equipments 20%
ix) In case of foreign companies comprised within the group, depreciation is provided for on straight-line basis so asto write off the assets over their useful lives, as estimated by the management, which range from 2 to 30 years.(23.78% of total Net Block of fixed assets as at March 31, 2007 and 28.78% of total depreciation / amortizationexpenses for the Punj Lloyd Group for the year ended March 31, 2007.
x) Intangibles
Amortization of different softwares used by the Group is done using the straight-line method based on the natureand useful lives of these softwares as mentioned below:
(i) Softwares of project division are amortized over a period of six years.
(ii) Softwares of internet service division are amortized over a period of five years.
(iii) Softwares of an unincorporated joint venture are amortized over a period of three years.
8. Borrowing Costs
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of thecost of such assets to the extent they relate to the period till such assets are ready to be put to use. A qualifying assetis one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs arecharged to the Profit and Loss Account.
9. Preoperative Expenditure pending allocation
Expenditure directly relating to construction activity is capitalized. Indirect expenditure incurred during constructionperiod is capitalized as part of indirect construction cost to the extent to which the expenditure is indirectly related to theconstruction or is incidental thereto. Other indirect expenditure (including borrowing cost) incurred during the constructionperiod, which is not related to the construction activity nor is incidental thereto, is charged to the Profit & Loss Account.
10. Investments
Investments that are readily realizable and intended to be held for not more than a year are classified as currentinvestments. All other investments are classified as long-term investments. Current investments are carried at lower ofcost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However,provision for diminution in value is made to recognize a decline, other than temporary, in the value of such investments.
11. Inventories
i) Stock in trade (Equipments), Spares, Stores and Consumables are valued at lower of cost and net realizablevalue. However, material and other items held for use in the production of inventories are not written down belowcost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost isdetermined on weighted average basis.
ii) Work in progress related to projects are valued at net realizable value.
iii) Scrap is valued at net realizable value.
iv) Scaffoldings (included in Spares, Stores and Consumables) are valued at cost less amortization/charge basedon their useful life, which is estimated at 10 years.
Net realizable value is the estimated selling price in the ordinary course of business less estimated costs to make thesale and estimated costs of completion.
12. Revenue recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and therevenue can be reliably measured.
i) Revenue from long-term construction contracts is recognized on the percentage of completion method. Percentageof completion is determined as a proportion of cost incurred to date to the total estimated contract cost. However,profit is not recognized unless there is reasonable progress on the contract. In case the total cost of a contract,
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based on technical and other estimates, is expected to exceed the corresponding contract value, such expectedloss is provided for. The effect of any adjustment arising from revisions to estimates is included in the incomestatement of the year in which revisions are made. The revenue on account of extra claims and the expenditureon account of liquidated damages on construction contracts are accounted for at the time of acceptance/ settlementby the customers due to uncertainties attached thereto. Similarly, insurance claims are accounted for on settlementwith insurers.
ii) Revenue from long term construction contracts executed in joint ventures under work sharing arrangements isrecognized on the same basis as similar contracts independently executed by the Company. Revenue in jointventures under profit sharing arrangements is recognized to the extent of the Company’s share in joint ventures.
iii) Internet Service revenues comprise of revenues from registration, installation and provision of Internet services.Registration fee and installation charges are recognized on the admission of customer and completion of servicesrespectively. Service revenue from Internet access is recognized pro-rata, calculated on the basis of provision ofservices or time duration of contract, as may be applicable.
iv) Revenue from sale of equipments is recognized when the significant risks and rewards of ownership of the goodshave passed to the buyer.
v) Revenue from hire charges is accounted for in accordance with the terms of agreements with the customers.vi) Rental income from lease assets under operating leases is recognized in the profit and loss account on a straight
line basis over the term of the lease.vii) Interest revenue is accounted for on a time proportion basis taking into account the amount outstanding and the
rate applicable.viii) Dividend revenue is recognized when the shareholders’ right to receive payment is established by the balance
sheet date.ix) Export Benefit under the Duty Free Credit Entitlements is accounted for in the year of export.
13. Miscellaneous Expenditure (to the extent not written off or adjusted)
The balance included under the head Miscellaneous Expenditure (to the extent not written off or adjusted) comprisesPreliminery Expenses incurred by certain subsidiaries and joint ventures, which are yet to commence commercialoperations. Such expenses will be amortized over a period of 5 years after commencement of commercial operationsby the respective entities.
14. Foreign currency translation
i) Initial Recognition
Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amountthe exchange rate between the reporting currency and the foreign currency at the date of the transaction.
ii) Conversion
Foreign currency monetary items are reported using the closing rate. Non-monetary items, which are carried interms of historical cost denominated in a foreign currency, are reported using the exchange rate at the date of thetransaction.
iii) Exchange Differences
Exchange differences arising on the settlement of monetary items or on reporting the group entity’s monetaryitems at rates different from those at which they were initially recorded during the year, or reported in previousfinancial statements, are recognized as income or as expenses in the year in which they arise except thosearising from investments in non-integral foreign operations. Exchange differences on transactions relating tofixed assets acquired from outside India are adjusted to the carrying amount of fixed assets.
Exchange differences arising on a monetary item that, in substance, forms part of the group’s net investment in anon-integral foreign operation are accumulated in a foreign currency translation reserve in the financial statementsuntil the disposal of the net investment, at which time they are recognized as income or as expenses.
iv) Translation of integral & non-integral foreign operations
The financial statements of an integral foreign operation are translated as if the transactions of the foreignoperation have been those of the Company itself.
In translating the financial statements of a non-integral foreign operation for incorporation in the consolidatedfinancial statements, the assets and liabilities, both monetary and non-monetary, of the non-integral foreignoperation are translated at the closing rate; income and expense items of the non-integral foreign operation aretranslated at exchange rates on the date of transactions. All resulting exchange differences are accumulated ina foreign currency translation reserve until the disposal of the net investment.
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On the disposal of a non-integral foreign operation, the cumulative amount of the exchange differences whichhave been deferred and which relate to that operation are recognized as income or as expenses in the sameperiod in which the gain or loss on disposal is recognized.
15. Retirement and other employee benefits
i) Retirement benefits in the form of provident fund and superannuation / pension schemes are charged to Profitand Loss Account of the year when the contributions to the respective funds are due. There are no other obligationsother than the contribution payable to the respective trusts.
ii) The Company has taken an insurance policy under group gratuity scheme with Life Insurance Corporation ofIndia / ICICI to cover the gratuity liability of the employees of project division and amount paid/payable in respectof present value of liability for past services is charged to Profit and Loss Account on the basis of actuarialvaluation at the end of the financial year. In respect of employees of ISP division and Indian Subsidiaries, gratuityliability is accrued and provided for on the basis of an actuarial valuation made at the end of each financial year.
iii) Liability for leave encashment is provided for on actuarial valuation done at the end of the financial year exceptin case of the overseas branches, where liability is provided on actual basis for leaves standing to the credit ofemployees.
iv) In respect of overseas group companies, contributions made towards retirement/employee benefits, in accordancewith the relevant applicable local laws, are charged to Profit and Loss Account.
16. Income taxes
Tax expense comprises of current, deferred and fringe benefit tax. Current income tax and fringe benefit tax is measuredat the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act and in theoverseas branches/companies as per the respective tax laws. Deferred income tax reflects the impact of current yeartiming differences between taxable income and accounting income for the year and reversal of timing differences ofearlier years.
Deferred tax is measured based on the tax rates and tax laws enacted or substantively enacted at the balance sheetdate.
Deferred tax assets and deferred tax liabilities across various countries of operation are not set off against each otheras the Company does not have a legal right to do so. Deferred tax assets are recognized only to the extent that thereis reasonable certainty that sufficient future taxable income will be available against which such deferred tax assetscan be realized. In situations where the group entity has unabsorbed depreciation or carry forward tax losses, deferredtax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realizedagainst future taxable profits.
17. Lease transactions
Where a group entity is the lessee
Finance Leases, which effectively transfer to the group entity substantially all the risks and benefits incidental toownership of the leased item, are capitalized at the lower of the fair value and present value of the minimum leasepayments at the inception of the lease term and disclosed as leased assets. Lease payments are apportioned betweenthe finance charges and reduction of the lease liability based on the implicit rate of return. Finance charges arecharged directly against income. Lease management fees, legal charges and other initial direct costs are capitalized.
If there is no reasonable certainty that the group entity will obtain the ownership by the end of the lease term, capitalizedleased assets are depreciated over the shorter of the estimated useful life of the asset or the lease term.
Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item, areclassified as operating leases. Operating lease payments are recognized as an expense in the Profit and Loss Accounton a straight-line basis over the lease term.
Where a group entity is the lessor
Assets subject to operating leases are included in fixed assets. Lease income is recognised in the Profit and LossAccount on a straight-line basis over the lease term. Costs, including depreciation are recognised as an expense in theProfit and Loss Account. Initial direct costs such as legal costs, brokerage costs, etc. are recognised immediately in theProfit and Loss Account.
18. Segment reporting policies
Identification of segments
The group’s operating businesses are organized and managed separately according to the nature of products andservices provided, with each segment representing a strategic business unit that offers different products and serves
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different markets. The analysis of geographical segments is based on the areas in which major operating divisions ofthe group operate.
Unallocated items
General corporate income and expense items are not allocated to any business segment.
19. Earnings per share
Basic earning per share is calculated by dividing the net consolidated profit or loss for the year attributable to equityshareholders by the weighted average number of equity shares outstanding during the year. Partly paid equity sharesare treated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to afully paid equity share during the reporting year. The weighted average number of equity shares outstanding during thereported years are adjusted for the events of bonus issue and share split.
For the purpose of calculating diluted earnings per share, the net consolidated profit or loss for the year attributable toequity shareholders and the weighted average number of shares outstanding during the year are adjusted for theeffects of all dilutive potential equity shares.
20. Provisions
A provision is recognized when an enterprise has a present obligation as a result of past event and it is probable thatan outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made.Provisions are not discounted to their present value and are determined based on best estimate required to settle theobligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the currentbest estimates.
21. Employee Stock Option
The Company accounts for stock compensation expenses, if any, arising on the employee stock option plans basedon the fair value method.
22. Cash and Cash Equivalents
Cash and cash equivalents in the cash flow statement comprise cash at bank and in hand
B. NOTES TO THE ACCOUNTS
1 The Punj Lloyd Group comprises of the following entities:
a) Subsidiaries
Name of the Company Country of % of % ofIncorporation voting power voting power
held as at held as atMarch 31, 2007 March 31, 2006
Spectra Punj Lloyd Limited India 98.00 98.00
Kaefer Punj Lloyd Limited (formerly Punj Lloyd Insulation
Limited (up to September 21, 2006) (Refer Note No. (i)) India 49.00 100.00
Spectra Infrastructure Limited India 100.00 100.00
Atna Investments Limited India 100.00 100.00
Spectra Punjab Limited India 100.00 100.00
PLN Construction Limited India 100.00 100.00
Spectranet Limited India 73.34 73.34
Punj Lloyd (Malaysia) SDN, BHD (Refer Note No (ii)) Malaysia — 100.00
Punj Lloyd Inc (Refer Note No (iii)) U.S.A — 100.00
Punj Lloyd International Limited British VirginIslands 100.00 100.00
Punj Lloyd Kazakhstan, LLP Kazakhstan 100.00 100.00
PT Punj Lloyd Indonesia Indonesia 100.00 100.00
Punj Lloyd Pte. Ltd. (w.e.f. June 02, 2006) Singapore 100.00 —
Simon Carves India Limited (w.e.f. December 13, 2006)* India 100.00 —
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b) Step down Subsidiaries
Name of the Company Country of % of voting % of voting
Incorporation power held as at power held as at
March 31, 2007 March 31, 2006
Spectranet Holdings Limited India 73.34 73.34
Sembawang Engineers and Constructors Pte. Ltd. @ Singapore 100.00 —
PT Sempec Indonesia @ Indonesia 100.00 —
Sembawang Development Pte Ltd @ Singapore 100.00 —
PT Synergy Technology Construction @ Indonesia 80.00 —
PT Indo Precast Utama @ Indonesia 100.00 —
PT Indo Unggul Wasturaya @ Indonesia 67.00 —
Wuxi Sinlian Precast Manufacturing Co. Ltd @ China 85.00 —
SembCorp (Tianjin) Construction Engineering Co. Ltd @ China 70.00 —
Construction Technology Pte Ltd @ Singapore 100.00 —
Contech Trading Pte Ltd @ Singapore 100.00 —
PT Contech Bulan @ Indonesia 60.00 —
Construction Technology (B) Sdn Bhd @ Brunei 100.00 —
SembCorp (Hebei) Building Materials Co. Ltd @ China 75.00 —
Sembawang Infrastructure (Mauritius) Ltd @ Mauritius 100.00 —
Sembawang Infrastructure (India) Pvt Ltd @ India 100.00 —
Sembawang-JTCI (China) Pte Ltd @ Singapore 51.00 —
Sembawang Construction Pte Ltd @ Singapore 100.00 —
SC Architects and Engineers Pte Ltd @ Singapore 100.00 —
Sembawang (Malaysia) Sdn Bhd @ Malaysia 100.00 —
Jurubina Sembawang (M) Sdn Bhd @ Malaysia 100.00 —
Simon-Carves Limited @ United Kingdom 100.00 —
Sembawang Simon-Carves Limited De Mexico @ Mexico 100.00 —
Sembawang Engineers and Constructors Middle East FZE @ United ArabEmirates 100.00 —
c) Joint Ventures- Jointly controlled Entities / Operations
i) Jointly Controlled Entities
Name of the Company Country of % of voting % of votingIncorporation power held as at power held as at
March 31, 2007 March 31, 2006
Thiruvananthpuram Road Development Company Limited India 50.00 50.00
Asia Drilling Services Limited (Joint Venture of
Punj Lloyd International Ltd.) Mauritius 50.00 50.00
Kaefer Punj Lloyd Limited (formerly Punj Lloyd Insulation
Limited (w.e.f. September 22, 2006) (Refer Note No. (i)) India 49.00 —
Swissport Punj Lloyd India Private Limited
(w.e.f. December 01, 2006)* India 49.00 —
Dayim Punj Lloyd Construction Contracting Company Ltd
(w.e.f. September 27, 2006)* Saudi Arab 49.00 —
SYNA Petrochemical Engineering Company (Iran) @ Iran 49.00 —
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ii) Jointly Controlled Operations
Name of the Company Country of % of voting % of votingIncorporation power held as at power held as at
March 31, 2007 March 31, 2006
Punj Lloyd-Progressive Constructions JV Refer Note No (iv) Refer Note No (v) Refer Note No (v)Persys-Punj Lloyd JV Refer Note No (iv) Refer Note No (v) Refer Note No (v)Punj Lloyd-PT Punj Lloyd Indonesia JV Refer Note No (iv) Refer Note No (v) Refer Note No (v)Punj Lloyd – Limak JV Refer Note No (iv) 50.00 50.00Punj Lloyd – Sunil Hi-tech Engineers JV(w.e.f. April 29, 2005) Refer Note No (iv) Refer Note No. (v) Refer Note No. (v)Whessoe Oil & Gas Ltd-Punj Lloyd JV(w.e.f. May 19, 2006)* Refer Note No (iv) 50.00 50.00Total-CDC-DNC Joint Operation @ Refer Note No (iv) 40.00 —Kumagai-Sembawang-Mitsui Joint Venture @ Refer Note No (iv) 45.00 —Kumagai-SembCorp Joint Venture @ Refer Note No (iv) 50.00 —Philipp Holzmann-SembCorp Joint Venture @ Refer Note No (iv) 50.00 —Kumagai-SembCorp Joint Venture (DTSS) @ Refer Note No (iv) 50.00 —Semb-Corp Daewoo Joint Venture @ Refer Note No (iv) 60.00 —Sime Engineering Sdn Bhd SembawangMalaysia Sdn Bhd Joint Venture @ Refer Note No (iv) 50.00 —Sime Engineering Sdn Bhd SembCorpMalaysia Sdn Bhd Joint Venture @ Refer Note No (iv) 50.00 —
d) Associates
i) Associates of Holding Company
Name of the Company Country of % of voting % of votingIncorporation power held as at power held as at
March 31, 2007 March 31, 2006
Bistro Hospitality Pvt. Limited
(up to July 24, 2006) ((Refer Note No (vi)) India — 40.00
ii) Associate of a Subsidiary
Gaitry Cable Network Private Limited(Associate of Spectranet Limited
(Refer Note No (vii))) India 49.00 49.00
iii) Associates of Step down Subsidiaries
City Vision Pvt. Ltd India 49.00 49.00Shitul Engineering Pvt. Ltd India 49.00 49.00Sunstar Network & Technologies Pvt. Ltd India 49.98 49.98Dot Com Holdings Pvt. Ltd India 49.00 49.00Satellite Vision Pvt. Ltd (Refer Note No (vii)) India 49.00 49.00Reliance Contractors Private Limited @ Singapore 49.99 —Ventura Development (Myanmar) Pte Ltd @ Singapore 35.00 —Regional Hotel Pte Ltd. @ Singapore 23.32 —Realand Pte Ltd @ Singapore 20.00 —Reco Sin Han Pte Ltd @ Singapore 20.00 —
* These entities have been incorporated / formed during the year.
@ These entities form part of the Sembawang Engineers & Constructors (SEC) Group, which has become a part ofthe Punj Lloyd Group effective June 02, 2006 consequent to acquisition of 100% stake by Punj Lloyd Limited inPunj Lloyd Pte Ltd. (a company incorporated in Singapore), which is the immediate holding company of SEC.
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i) During the year, the Group has divested 51 % stake in Kaefer Punj Lloyd Ltd (formerly Punj Lloyd Insulations Ltd (PLI),an erstwhile 100% subsidiary) by inducting a foreign joint venture partner (Kaefer GMBH). Consequently, in thepreparation of these Consolidated Financial Statements, PLI has been accounted for as a subsidiary up to September21, 2006 and as a joint venture thereafter. Further, in the absence of audited financials, management approvedfinancial statements of the entity have been used, both for computation of the loss arising on the dilution and also foryear-end consolidation purposes.
ii) At an Extraordinary general meeting held on April 25, 2005, the shareholders of the Punj Lloyd (Malaysia) SDN, BHD(a subsidiary incorporated in Malaysia) passed a special resolution for the voluntary winding up in accordance with thelaws of that country. Accordingly, the accompanying Consolidated Financial Statements do not include any assets orliabilities of the Punj Lloyd (Malaysia) SDN, BHD, which is in the process of being wound up. Adjustments have beenmade during the current year for the difference between the carrying value of the net assets of the subsidiary and theamounts expected to be realized thereagainst and also for any further liabilities which may arise in this regard.
iii) In the previous year, the Company had decided to wind up its subsidiary Punj Lloyd Inc. (A subsidiary incorporated inUSA) w.e.f. December 31, 2005. The process of winding up is being carried out in accordance with laws of that country.The accompanying Consolidated Financial Statements do not include any assets or liabilities of the Punj Lloyd Inc.There are no operations in that entity and therefore pending receipt of necessary clearance from the appropriateauthorities, adjustments have been made during the current year for the difference between the carrying value of thenet assets of the subsidiary and the amounts realized thereagainst.
iv) Country of Incorporation not applicable, as these are Unincorporated Joint Ventures.
v) As per the joint venture agreements, the scope & value of work of each partner has been clearly defined and acceptedby the clients. The Company’s share in Assets, Liabilities, Income and Expenses are duly accounted for in the accountsof the Company in accordance with such division of work and therefore does not require separate disclosure. However,joint venture partners are, jointly & severally, liable to clients for any claims in these projects.
vi) During the year, the group has divested its stake in this associate entity. Management approved unaudited financialstatements have been considered for consolidation purposes. The consolidated Profit & Loss Account includes profitof Rs 1,795 thousand (previous year Rs 7,858 thousand) (being the proportionate share of the Punj Lloyd Group uptothe date of divestment of stake) from the entity.
vii) In the absence of availability of financial statements of these entities, these have not been consolidated as at March31, 2007. The Group has provided for diminution in the value of investments to the extent of its cost of investment inthese entities aggregating Rs. 3,799 thousand (previous year Rs 3,799 thousand) as at March 31, 2007.
2. Segment Information
Business Segments
The group’s operating businesses are organized and managed separately according to the types of products/servicesprovided. The identified reportable segment is engineering & construction business. The others segment includesmanufacture and sale of ready mix concrete, broadband services, equipment hire services, and cable TV operations.Segmental information is disclosed as under:
Engineering & Others Corporate unallocable TotalConstruction expenses
For the For the For the For the For the For the For the For theyear ended year ended year ended year ended year ended year ended year ended year endedMarch 31, March 31, March 31, March 31, March 31, March 31, March 31, March 31,
2007 2006 2007 2006 2007 2006 2007 2006
External Segment Revenue 51,067,640 16,700,863 401,399 329,495 590,450 135,525 52,059,489 17,165,883
Internal Segments – – – – – – – –
Segment Revenue 51,067,640 16,700,863 401,399 329,495 590,450 135,525 52,059,489 17,165,883
Segment Results 3,363,874 2,449,202 (30,624) (73,771) (683,327) (1,544,435) 2,649,923 830,996
Segment Assets 51,406,095 20,293,432 1,018,421 995,552 5,175,665 1,767,233 57,600,181 23,056,217
Segment Liabilities 25,135,797 4,909,738 171,300 126,843 19,445,429 6,804,337 44,752,526 11,840,918
Capital Expenditure 4,756,200 2,120,061 30,833 25,002 251,641 195,695 5,038,674 2,340,758
Depreciation/Amortization 802,921 491,120 80,274 80,836 178,311 31,744 1,061,506 603,700
Non Cash Expenses 141,681 41,378 – 16,844 213 449 141,894 58,671
(Rs. in ‘000)
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Reconciliation of Reportable Segments with financial StatementsRevenues Results Assets Liabilities
For the For the For the For the As at As at As at As atyear ended year ended year ended year ended March 31, March 31, March 31, March 31,March 31, March 31, March 31, March 31, 2007 2006 2007 2006
2007 2006 2007 2006
Total of Reportable Segments 52,059,489 17,165,883 2,649,923 830,996 57,600,181 23,056,217 44,752,526 11,840,918
Less : Corporate unallocated: – – (689,602) (291,472) – – – –Taxes
Add: Share in profits of associates – – 9,668 7,754 – – – –Add: Share of lossestransferred to minority – – 2,712 7,340 – – – –
Less : Pre-aquisition profit adjustedagainst goodwill – – (3,435) – – – – –
As per Segment 52,059,489 17,165,883 1,969,266 554,618 57,600,181 23,056,217 44,752,526 11,840,918
As per Financial Statements 52,059,489 17,165,883 1,969,266 554,618 57,600,181 23,056,217 44,752,526 11,840,918
Geographical Segments*:
Although the Group’s major operating divisions are managed on a worldwide basis, they operate in two principal geographicalareas of the world, in India, its home country, and the other countries.
The following table presents revenue and debtors regarding geographical segments for the year ended March 31, 2007 andMarch 31, 2006.
(Rs. in ‘000)
Sales Revenue by Debtors (including retention money) byGeographical Market Geographical Market
2006-07 2005-06 2006-07 2005-06
India 16,914,051 9,830,331 4,129,498 2,764,592
Other countries 35,145,438 7,335,552 8,104,378 1,259,813
Total 52,059,489 17,165,883 12,233,876 4,024,405
* The Group has common assets for servicing Domestic Market and Overseas Markets. Hence, separate figures for assets/additions to assets cannot be furnished.
(Rs. in ‘000)
As at March 31, 2007 As at March 31, 2006
Punj Lloyd Joint Punj Lloyd JointLimited & Ventures Limited & Ventures
Subsidiaries Subsidiaries
3. Capital Commitments
Estimated amount of contracts remaining to be executed
on capital account and not provided for (net of advances) 260,272 346,460 581,445 593,485
4. Contingent liabilities to the extent not provided for :
a) Bank Guarantees given by the Company 3,207,857 5,355 401,793 –
b) Liquidated damages deducted by customers notaccepted by the Company and pending final settlement(Refer Note No. 6(b) below) 448,839 – 449,558 –
c) Indemnity to a Financial Institution against issue ofPerformance Guarantee in favour of third parties inrespect of construction projects of the group. 646,611 – – –
d) Claims by parties/clients against subsidiaries notacknowledged as debt 8,377 – –
e) Corporate Guarantees given on behalf of associates 5,444,688 – 68,000 –
f) Differential amount of customs duty in respect ofmachinery imported under EPCG Scheme. 15,009 – 16,516 –
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g) Estimated future investments in other companies in terms of respective shareholder agreements amounting in aggregateto Rs. 40,049 thousand (previous year Rs 1,180,000 thousand).
h) i) Sales tax demand on the material components of the works contracts pending with Sales Tax Authorities and HighCourt amounting to Rs. 36,083 thousand (previous year Rs 141,866 thousand.)*
ii) Sales tax demand for non-submission of statutory forms aggregating to Rs. 66,006 thousand (previous year Rs.66,006 thousand)*
iii) Sales tax demand for disallowance of deduction on purchase aggregating to Rs. 4,201 thousand (previous yearRs. 43,619 thousand)*
iv) Sales Tax liability for purchases against sales tax forms not accepted by department of Rs. 22,756 thousand(previous year Rs. 31,146 thousand) *
v) Entry Tax liability against entry of goods into the local area not accepted by department of Rs. 18,856 thousand(previous year Nil)*
vi) Sales Tax Liability against the CST demand on sales in transit of Rs 720 thousand (previous year: Nil).
vii) Sales Tax demand in respect of Internet Service Division regarding taxability of Internet services of Rs. 21,178thousand (previous year Rs. 21,178 thousand). The same is contested by the company in view of similar matterdecided by the Hon’ble Supreme Court of India in the case of Bharat Sanchar Nigam Ltd & another Vs Union ofIndia & others wherein it was held that internet services are not taxable as goods. *
i) The Company has not acknowledged as debt a claim lodged by one of its suppliers amounting to Rs. 35,448 thousand(previous year Rs. 5,082 thousand) on account of services rendered in earlier years. The matter is under arbitration. *
*Based on favorable decisions in similar cases/legal opinions taken by the Company/consultations with solicitors, themanagement believes that the Company has good chances of success in above mentioned cases and hence, noprovision there against is considered necessary.
5. Leases
a) Assets taken under Finance Lease
The Company has acquired Project Equipment under hire purchase, the cost of which is included in the gross block ofPlant & Machinery under Fixed Assets. The lease term is for 3 years to 5 years, after which the legal title will pass on tothe Company. There is no escalation clause in the lease agreements. There are no restrictions imposed by leasearrangements. There are no sub leases:
Rs. in ‘000
As at March As at March31, 2007 31, 2006
Gross block at the end of period 829,024 359,207
Written down value at the end of period 638,221 324,415
Details of payments made during the period:
– Principal 91,165 43,967
– Interest 63,070 9,343
The break-up of minimum hire purchase payments outstanding as at March 31, 2007 is as under
As at March 31, 2007
Principal Interest Total
Payable within one year 71,596 57,506 129,102
Payable after one year but before end of fifth year 659,068 417,793 1,076,860
730,663 475,299 1,205,962
As at March 31, 2006
Principal Interest Total
Payable within one year 78,811 18,971 97,782
Payable after one year but before end of fifth year 213,031 28,447 241,478
291,842 47,418 339,260
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b) Assets taken under Operating Lease
Certain Project Equipments and Office premises are obtained on operating lease. There are no contingent rents in thelease agreements. The lease terms are for 1-3 years and are renewable at the mutual agreement of both the parties.There is no escalation clause in the lease agreement. There are no restrictions imposed by lease arrangements. Thereare no subleases and all the leases are cancellable in nature.
c) Assets given on operating lease (Rs. in ‘000)
Year ended
March 31, 2007 March 31, 2006
Uncollectible minimum lease payments receivable at theBalance sheet date – –Future minimum lease paymentsNot later than one year 2,297 –Later than one year and not later than five years 6,894 –Later than five years – –
TOTAL 9,191 –
6. a) The Company had executed two projects of Sulphur Recovery Units of Indian Oil Corporation Limited (IOCL) at theirrefineries at Mathura and Vadodara in an earlier year on back-to-back basis for Petrofac International Limited (PIL) whowas the main contractor. IOCL had withheld payments from PIL on account of duties and taxes and PIL had in turnwithheld Rs. 294,065 thousand (previous year Rs. 297,734 thousand) from the company in an earlier year, which areoutstanding as debts at the close of the year. PIL had gone into arbitration against IOCL and lodged claims for recoveryof above amount and also some other claims amounting to Rs. 387,034 thousand (previous year Rs. 387,034 thousand).These claims of Rs. 387,034 thousand have not been accounted for in the books. Pending outcome of arbitration,amount withheld by PIL is being carried forward under sundry debtors. The Company has been legally advised that interms of the contract, it is entitled to receive the above amount and hence, the same is considered good of recovery.
b) The Company had executed a pipeline project at Dahej - Vijaypur for Gas Authority of India Limited (GAIL) in an earlieryear. GAIL had withheld Rs. 421,725 thousand (previous year Rs. 423,707 thousand) as liquidated damages and Rs.40,441 thousand (previous year Rs. 40,441 thousand) towards other deductions, which the Company is disputing.Also, the Company had filed some other claims with GAIL amounting to Rs. 999,004 thousand (previous year Rs.999,004 thousand). These claims have not been accounted for in the books. The Company had gone into arbitrationagainst GAIL for recovery of amount withheld as liquidated damages & other deductions and claims of the Company.Pending outcome of arbitration, amount withheld for liquidated damages & other deductions are being carried forwardunder sundry debtors. The Company has been legally advised that there is no justification in imposition of liquidateddamages and other deductions by GAIL and hence the above amount is considered good of recovery.
c) The Company had executed a pipeline project for Petronet MHB Limited in an earlier year. The customer had withheldRs. 4,440 thousand (previous year Rs. 4,440 thousand) from the running bills, which are being carried forward undersundry debtors. The customer had also not certified the final bill amounting to Rs. 64,000 thousand (previous year Rs.64,000 thousand), which is being carried forward under work in progress. The Company had raised claims for Rs.517,387 thousand (previous year Rs. 517,387 thousand), which are not accounted for in the books. For recovery of thesaid amounts, which are being disputed by the customer, the Company has initiated Arbitration proceedings. Theoutstanding amounts are considered good of recovery.
7. The Company in the previous year had raised variation orders of Rs. 1,448,892 thousand (previous year Rs. 1,490,000thousand) on Spie Capag - Petrofac International Limited (SCPIL) with whom the Company had entered into a contract forconstruction of pipelines in Georgia. SCPIL had raised debit notes of Rs. 464,166 thousand (previous year Rs. 477,400thousand) on the Company. These variations orders and debit notes are being disputed and have not been agreed betweenthe management of the Company and SCPIL. However, the ultimate outcome of the dispute cannot presently be determinedby the Company. Accordingly these variation orders and debit notes have not been recorded in these financial statements.An amount of Rs. 367,531 thousand including Rs. 292,671 thousand in respect of invoices raised and Rs. 74,860 thousandin respect of debit notes (previous year Rs. 301,016 thousand and Rs. 77,000 thousand respectively) is withheld by SCPILin view of the disputes. This amount is being carried forward under sundry debtors and is considered good of recovery.
SCPIL has purported to serve a notice of suspension to the Company by letter dated February 22, 2005 and a notice ofintention to terminate Subcontract Agreement for default dated March 28, 2005. The Company does not accept that thegrounds for service of the notice are valid.
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8. The disclosures as per provisions of Clause 38, 39 and 41 of Accounting Standard 7 issued by Institute of CharteredAccountants of India are as under:
(Rs. in ‘000)
As at March As at March31, 2007 31, 2006
a) Contract revenue recognised as revenue in the period (Clause 38 (a)) 49,819,604 15,981,987b) Aggregate amount of costs incurred and recognised profits up to the reporting
date on Contracts under progress (Clause 39 (a)) 110,554,319 37,885,853
c) Advance received on Contracts under progress (Clause 39 (b)) 9,061,564 1,147,872
d) Retention amounts on Contract under progress (Clause 39 (c)) 1,638,170 148,458
e) Gross amount due from customers for contract work as an asset (Clause 41(a)) 12,209,023 7,234,573
f) Gross amount due to customers for contract work as a liability (Clause 41 (b)) 392,677 243,392
9. (a) One of the subsidiaries of the company, Spectra Punjab Limited, had in earlier years laid down optical fiber cable andducts network in the State of Punjab for providing broadband services. Spectra Punjab operations remain suspendedpresently. However, the holding Company proposes to use its own internet service network to restart the operations ofSpectra Punjab Limited. Accordingly the accounts of the subsidiary have been prepared on a going concern basis.
(b) Spectra Punjab Limited is yet to commence the commercial operations of providing Internet Services. Accordingly,incidental expenses for the project up to March 31, 2007 amounting to Rs. 2,907 thousand (excluding Rs. 1,000thousand being consideration paid for services under joint venture agreement) is carried forward as pre-operativeexpenditure, to be capitalized or treated as deferred revenue expenditure in accordance with generally acceptedaccounting principles at the time of commencement of commercial operations.
10. Current Assets include Rs. 4,225 thousand (previous year Rs. 4,225 thousand) recoverable pursuant to agreements for saleof 128,400 shares of Panasonic Batteries India Company Limited (Formerly known as Matsushita Lakhanpal Battery IndiaLimited) entered into on March 27, 1992, which are subject matter of a dispute in the Honorable High Court at Mumbai,wherein the Company has been restrained from transferring these shares till the final disposal of the suit. These sharesremain in the possession of the Company and the market value thereof at close of the year is Rs. 8,218 thousand (previousyear Rs. 9,309 thousand).
11. During an earlier year, the Company had entered into agreements to sell its investments in the shares of certain companiesof the cost of Rs. 111,974 thousand and had received advances representing consideration for the future sale of shares (asdefined in the above agreements) in these companies, including all accretions thereto till the date of sale. Through the aboveagreements to sell, the Company had agreed to give all the powers and rights in these shares to purchasers. In terms of theabove arrangement, the Company in that previous year had accounted for Rs. 20,300 thousand, being the amount receivedin excess of book value of shares (for all the companies) as income on transfer of the powers and rights in the underlyingshares to purchasers and the balance consideration of Rs. 111,974 thousand equivalent to the amount of investment inabove shares appearing in the books is shown as deposit under Current Liabilities to be adjusted against the sale of sharesin the above companies on the date of sale.
12. The Company in an earlier year had entered into an Assets Sale Agreement for sale of its certain fixed assets relating to ISPundertaking. The sale tax liability on such transaction is subject to determination by the relevant authorities for which anapplication is pending adjudication. The amount of such liability is indeterminable at present. As per agreement with thebuyer, any such sales tax liability is to be borne by the buyer. Consequently, aforesaid sale tax liability on such transactionshas not been provided for.
13. During the year, Spectra Punj Lloyd Ltd (SPLL), a subsidiary of the company, has applied for delisting of its equity sharecapital in accordance with Clause 7 of the Securities and Exchange Board of India (Delisting of Securities) Guidelines 2003and such other provisions as may be applicable. SPLL alongwith Mr Atul Punj, Master Shiv Punj, Mrs Arti Punj, Ms Jyoti Punj,M/S PLE Hydraulics Private Limited, M/S Atna Investments Limited, M/S Jyotcon Equipments Hire Private Limited (i.e.persons acting in concert) made an offer to acquire 25,000 shares in Spectra Punj Lloyd Ltd at a price to be determinedunder Reverse Book Building process in accordance with the Securities & Exchange Board of India (Delisting of Securities)Guidelines 2003.
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14. EARNING PER SHARE
Basic Earnings 2006-07 2005-06
a) Calculation of weighted average number of equity shares of Rs. 2 each
Number of equity shares at the beginning of the year 261,099,180 121,585,635
Equity shares at the end of the year 261,260,335 261,099,180
Weighted average number of equity shares outstanding during the year 261,145,385 217,608,380
(taking into consideration split of equity shares in terms of para 24 of AS-20)
b) Net Consolidated Profit after tax available for equity share holders
(Rupees in thousand) 1,969,266 554,618
c) Basic earning per share of Rs. 2 each 7.54 2.55
Diluted Earnings
a) Calculation of weighted average number of equity shares of Rs. 2 each
Number of equity shares at the beginning of the year 261,099,180 121,585,635
Equity shares at the end of the year 261,260,335 261,099,180
Weighted average number of equity shares outstanding during the year 281,148,570 229,967,573
(taking into consideration split of equity shares in terms of para 24 of AS-20)
b) Net Consolidated Profit after tax available for equity share holders(Rupees in thousand) 1,969,266 554,618
c) Diluted earning per share of Rs. 2 each 7.00 2.41
15. (a) During the previous year, the Company had made an Initial Public Offering (IPO) of 9,172,937 Equity Shares of Rs 10/- each for cash at premium of Rs 690/- per share comprising of 8,355,174 Equity Shares freshly issued by the Companyand 817,763 Equity Shares offered for sale by the Selling Shareholders.
(b) Initial Public Offer (IPO) fund utilization: The Company spent Rs 5,848,621 thousand (previous year Rs. 4,800,927thousand) out of fresh issue of share capital of Rs. 5,848,621 thousand as follows:
(Rs. in ‘000)
Particulars Projected Utilisation Actual as on Actual as onas per the March March 31,
Prospectus dated 31, 2007 2006December 19, 2005
Investment in Capital Equipment Up to 1,500,000 1,485,269 705,230
Prepayment of Debts Up to 3,000,000 3,064,170 3,064,170
Equity Investment in Infrastructure Projects, WOS and JVs Up to 500,000 453,306 203,510
General Corporate Purposes 522,921 540,779 522,920
Offer related expenses 325,700 305,097 305,097
TOTAL 5,848,621 5,848,621 4,800,927
16. During the year, the Company has introduced Employee Stock Option Scheme, 2006 (ESOP 2006), to grant 1,000,000 stockoptions to employees of the Company. The Remuneration Committee in its meeting held on October 30, 2006 has approvedthe grant of 298,210 stock options to employees at a price of Rs. 772.30 (being the market price as defined in SEBIguidelines). These stock options shall vest in the ratio of 10%, 20%, 30% and 40% at the end of one, two, three and four yearsrespectively from the date of grant. The exercise period is eighteen months from the date of vesting. As on March 31, 2007,no stock option has been vested out of this grant.
During the previous year, the Company had introduced Employee Stock Option Plan, 2005 (ESOP 2005) to grant 800,000stock options to the employees. The Remuneration Committee in its meeting held on November 17, 2005 granted 643,489stock options at a price of Rs. 630 each (being at a 10% discount to the IPO price) to employees. These stock options werevested in the ratio of 10%, 20%, 30% and 40% at the end of one, two, three and four years respectively from the date of grant.The exercise period is three years from the date of vesting. As on March 31, 2007, 64,354 stock options have been vestedin the employees and out of these 32,231 stock options have been exercised.
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As per SEBI guidelines, the shareholders in their meeting held on April 3, 2006, ratified pre IPO stock option plan “ESOP2005” to grant the balance 156,511 stock options to the employees. The Remuneration Committee vide its resolution datedMay 10, 2006 granted 154,208 stock options to employees at a price of Rs. 1179.95 each (being the market price as definedin the SEBI guidelines). These stock options shall vest in the ratio of 10%, 20%, 30% and 40% at the end of one, two, threeand four years respectively from the date of grant. The exercise period is three years from the date of vesting. As on March31, 2007 no stock option has been vested out of this grant.
17. The Company has sub-divided the face value of Equity shares from Rs. 10 to Rs. 2 w.e.f. March 6, 2007. Consequently thetotal number of shares has increased from 52,252,067 to 261,260,335. Also the number of equity shares underlying thevarious stock options and other terms & conditions will accordingly undergo a change.
18. a) During the year, the Company has issued at par, 5 years and 1 day Zero Coupon US $ denominated Foreign CurrencyConvertible Bonds (FCCB) aggregating to US $ 125,000 thousand (INR 5,543,750 thousand as on the date of issue)comprising 1,250 bonds of US $ 100,000 each to invest in capital goods, repayment of international debts, possibleacquisitions outside India, investment in BOOT projects and any other use as may be permitted under applicable lawor by the regulatory bodies from time to time. The bond holders have an option of converting these bonds into equityshares at an initial conversion price of Rs. 1,362.94 per share (Face value Rs. 10) with a fixed rate of exchangeconversion of Rs. 44.35 = US $ 1.00, at any time on or after July 1, 2006 and prior to close of business on March 24,2011, unless redeemed, repurchased and cancelled or converted.
b) Expenses of Rs. 98,149 thousand incurred in connection with the issue of zero coupon foreign currency covertiblebonds have been adjusted against Securities Premium Account in terms of Section 78 of the Companies Act, 1956.
c) Expenses incurred in connection with the issue of FCCBs include Rs. 1,525 thousand paid to the auditors towardsprofessional fees and adjusted against Securities Premium account.
d) Bank balances include Rs. 828,085 thousand (previous year : Nil) held abroad, being unutilised portion out of theFCCB proceeds.
19. Deferred Tax Liability (Net)
(Rs. in ‘000)
Components of Deferred Deferred Addition on Current Period Deletions on Deferred TaxTax Liability (Net) Tax Asset/ acquisition of (Charge)/ divestment Asset/(Liability)
(Liability) as at subsidiaries Credit of stake in as at MarchApril 01, 2006 a subsidiary 31, 2007
Differences in depreciation in block (550,084) 43,658 (80,617) (233) (587,276)
of fixed assets as per Income Tax andFinancial Books
Effect of expenditure not debited to (65,726) (20,653) (86,379)Profit and Loss account but allowablein Income Tax
Difference in carrying value of (6,793) (415) (7,208)Scaffolding as per Income Tax &Financial Books
Effect of expenditure debited to Profit 9,683 342,686 (58,310) 294,059and Loss Account in the current yearbut allowable in following years underIncome Tax
Deduction u/s 35D 6,496 (6,496) –
Employee Retirement Benefits 27 12 39
Provision for Doubtful Debts & Advances - 27,291 27,291
Unadjusted Losses/Carried Forward
Losses - 2,090 2,090
Foreign currency translation 321 (3,827) (3,506)
Deferred Tax Liability (Net)* (606,076) 386,344 (140,925) (233) (360,890)
*After setting off Deferred Tax Assets aggregating Rs. 322,326 thousand in respect of certain group companies.
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20. RELATED PARTY DISCLOSURES
Names & Description of Related Parties
i) Joint Ventures of the Company
a) Jointly Controlled Entities
1) Thiruvananthpuram Road Development Company Limited
2) Asia Drilling Services Limited
3) Swissport Punj Lloyd India Pvt Ltd. (w.e.f. December 01, 2006)
4) Dayim Punj Lloyd Construction Contracting Company Limited (w.e.f. September 27, 2006)
5) Kaefer Punj Lloyd Limited (Formerly known as Punj Lloyd Insulations Ltd. (w.e.f. September 22, 2006)
b) Jointly Controlled Operations
1) Punj Lloyd - Limak JV
2) Punj Lloyd - Progressive Construction JV
3) Persys-Punj Lloyd JV
4) Punj Lloyd-PT Punj Lloyd Indonesia JV
5) Punj Lloyd- Sunil Hi-tech Engineers JV ( w.e.f. April 29, 2005)
6) Whessoe Oil & Gas Ltd-Punj Lloyd JV (w.e.f May 19, 2006)
ii) Associates of the Holding Company
1) Bistro Hospitality Private Limited (upto July 24, 2006)
iii) Associate of a Subsidiary
1) Gaitry Cable Network Pvt. Limited
iv) Associates of a Step down Subsidiaries
1) City Vision Pvt. Ltd
2) Shitul Engineering Pvt. Ltd
3) Sunstar Network & Technologies Ltd
4) Dot Com Holding Pvt. Ltd
5) Satellite Vision Pvt. Ltd
6) Reliance Contractors Private Limited (w.e.f. June 02, 2006)
7) Ventura Development (Myanmar) Pte Ltd (w.e.f. June 02, 2006)
8) Regional Hotel Pte Ltd. (w.e.f. June 02, 2006)
9) Realand Pte Ltd (w.e.f. June 02, 2006)
10) Reco Sin Han Pte Ltd (w.e.f. June 02, 2006)
v) Key Managerial Personnel of the Punj Lloyd Group
1) Atul Punj Chairman
2) V.K. Kaushik Managing Director
3) Luv Chhabra Director Corporate Affairs
4) Uday Punj Wholetime Director (upto December 30, 2005)
5) P.K.Gupta Wholetime Director (upto July 19, 2005)
6) V.K.Sud Wholetime Director (upto July 19, 2005)
7) Tarwinder Singh Wholetime Director (upto December 30, 2005)
8) H.K. Kaul Wholetime Director (from July 19, 2005 to December 30,2005)
9) J B Dewan Wholetime Director
| 134 |
10) Adil Vadoliwala General Director
11) Sandeep Garg Chief Operating Officer
12) V.P.Sharma Wholetime Director
13) A Rajendra Wholetime Director
14) Arvind Pasricha Manager (upto January 31, 2007)
15) K. Ramchand Managing Director
16) Ravindra Kansal Managing Director
17) Navina Punj Wholetime Director
18) Sanjay Goel Chief Executive Officer
vi) Relatives of Key Managerial Personnel
1) S.N.P.Punj - Father of Chairman
2) Arti Singh - Sister of Chairman
3) Saroj Gupta - Wife of a Director (upto July 19, 2005)
4) Paresh Gupta - Son of a Director (upto July 19, 2005)
5) Indu Rani Punj - Mother of Chairman
6) Uday Punj - Brother of Chairman
7) Manglam Punj - Wife of Brother of Chairman
8) Shiv Punj - Son of Chairman
9) Jai Punj - Son of brother of Chairman
10) Dev Punj - Son of brother of Chairman
11) Kumkum Kaushik - Wife of Managing Director
vii) Enterprises over which relatives of Key managerial Personnel are exercising significant influence.
1) Punj Business Center – owned by father of Chairman
2) Collectible @ The Inside Story – Owned by Sister of Chairman
3) Indtech Construction Pvt Ltd – Shareholding of Chairman
4) Spectra Punj Finance Pvt Ltd – Shareholding of Chairman
5) Cawdor Enterprises Ltd – Shareholding of Chairman
6) Uday Punj (HUF) – HUF of brother of Chairman
7) K.R.Securities (P) Ltd – Shareholding of Brother of Chairman
8) Atul Punj (HUF) – HUF of Chairman
9) Vishwedeva Builders and Promoters Pvt Ltd – Shareholding of sister of Chairman
10) PTA Engineering and Manpower Services Pvt Ltd – Shareholding of Chairman
11) PLE Hydraulics Pvt Ltd - Shareholding of Chairman
12) Special Steel Forgings Pvt Ltd – Shareholding of Chairman
13) Indo Pacific Aviation Pvt Ltd – Shareholding of Chairman
14) Petro IT Pvt Ltd – Shareholding of Brother of Chairman
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 135 |
Join
t Ven
ture
sA
ssoc
iate
sK
ey m
anag
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(Rs.
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(Rs.
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(Rs.
in ‘0
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(Rs.
in ‘0
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Mar
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Mar
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Mar
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Mar
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Mar
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31, 2
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31, 2
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31, 2
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31, 2
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Co
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--
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2,12
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V K
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656
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Kae
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(For
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now
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Pun
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sula
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Lim
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1,12
8-
-1,
128
-S
wis
spor
t Pun
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dia
Pvt
Ltd
243
--
-24
3-
Hir
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har
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Indo
Pac
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Avi
atio
n P
vt L
td-
--
24,2
7024
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-E
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EN
DIT
UR
EC
on
trac
tors
Ch
arg
esK
aefe
r Pun
j Llo
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td (F
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kno
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asP
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loyd
Insu
latio
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imite
d)10
,744
--
-10
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-P
etro
IT P
vt L
td-
--
6,88
86,
888
-H
ire
Ch
arg
esIn
do P
acifi
c A
viat
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Pvt
Ltd
--
-11
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3,35
311
,266
3,35
3C
on
sult
ancy
/Pro
fess
ion
al c
har
ges
SN
P P
unj
--
6060
-60
60M
anag
eria
l Rem
un
erat
ion
Atu
l Pun
j10
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-10
,000
-V
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aush
ik-
-7,
850
6,67
3-
7,85
06,
673
Luv
Chh
abra
--
7,56
36,
666
-7,
563
6,66
6U
day
Pun
j-
--
4,50
8-
-4,
508
Mah
inde
r Pra
kash
--
-16
0-
-16
0P
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upta
--
-1,
579
--
1,57
9V
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ud-
--
2,04
4-
-2,
044
Tar
win
der S
ingh
--
-2,
778
--
2,77
8H
K K
aul
--
-1,
582
--
1,58
2K
aefe
r P
un
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n a
sP
un
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sula
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B D
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2,22
61,
276
2,22
61,
276
Pu
nj L
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akh
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LL
PA
dil V
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a-
921
-92
1S
pec
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13,5
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13,5
7713
,385
V P
Sha
rma
-3,
792
-3,
792
A R
ajen
dra
-11
3-
113
Sim
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Car
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Ind
ia L
tdS
anja
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2,72
1-
2,72
1-
Div
iden
d P
aym
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Indt
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Con
stru
ctio
n P
vt L
td-
-4,
230
1,98
34,
230
1,98
3C
awdo
r Ent
erpr
ises
Ltd
--
15,2
087,
096
15,2
087,
096
Oth
ers
--
8,82
84,
522
353
165
9,18
14,
687
Ren
tP
unj B
usin
ess
Cen
ter
--
-22
,495
22,5
2722
,495
22,5
27P
TA
Eng
inee
ring
and
Man
pow
er S
ervi
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Pvt
Ltd
--
-1,
500
1,50
01,
500
1,50
0S
ub
scri
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Atn
a In
vest
men
ts L
tdP
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fras
tru
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(Fo
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no
wn
as
RE
LA
TE
D P
AR
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DIS
CL
OS
UR
ES
| 136 |
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(Co
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.)
Join
t Ven
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sA
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The
Insi
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tory
--
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7-
Inve
stm
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du
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g th
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Pvt
Ltd
49-
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hapu
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Roa
d D
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d13
0,00
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--
130,
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-D
ayim
Pun
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onst
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Con
trac
ting
Co.
Ltd
.11
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--
11,7
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Inve
stm
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du
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arB
istr
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talit
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6,00
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g th
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arP
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JV15
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--
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sula
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(5,7
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--
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issp
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Join
t Ven
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of W
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oe O
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Gas
Ltd
and
Pun
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d D
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d27
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--
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214,
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Day
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--
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s P
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(207
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(207
)C
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The
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PT
A E
ngin
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Ser
vice
s P
vt L
td-
--
(587
)(2
84)
(587
)(2
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Pac
ific
Avi
atio
n P
vt L
td-
--
17,1
04(9
34)
17,1
04(9
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Pet
ro IT
Pvt
Ltd
--
-(4
,640
)(4
,640
)-
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an f
rom
/(to
) a
Dir
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rV
K K
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a In
fras
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avin
a P
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stm
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j1,
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1,18
01,
180
1,18
0S
alar
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om
mis
sio
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ayab
leA
tul P
unj
--
10,0
00-
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00-
V.K
. Kau
shik
--
2,25
5-
2,25
5-
Luv
Chh
abra
--
2,40
9-
2,40
9-
Inve
stm
ents
Bis
tro
Hos
pita
lity
Priv
ate
Lim
ited
--
41,3
44-
--
41,3
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hitu
l Eng
inee
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P L
td63
166
663
166
6D
otC
om H
oldi
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td8
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12R
eala
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te. L
td.
7,76
9-
7,76
9-
Rec
o S
in H
an P
te L
td.
15,0
78-
15,0
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Sec
uri
ty D
epo
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Sp
ectr
a In
fras
tru
ctu
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imit
edP
unj B
usin
ess
Cen
tre
55
55
Atn
a In
vest
men
t L
tdP
unj B
usin
ess
Cen
tre
55
55
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 137 |
RE
LA
TE
D P
AR
TY
DIS
CL
OS
UR
ES
(Co
ntd
.)
Ban
k G
uar
ante
es-
-P
unj L
loyd
- P
rogr
essi
ve C
onst
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ion
JV-
154,
640
--
--
154,
640
Thi
ruva
nant
hapu
ram
Roa
d D
evel
opm
ent C
ompa
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imite
d25
,000
25,0
00-
--
25,0
0025
,000
Sw
issp
ort P
unj L
loyd
Indi
a P
vt L
td6,
000
--
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000
-C
orp
ora
te G
uar
ante
es-
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aefe
r Pun
j Llo
yd L
td (F
orm
erly
kno
wn
asP
unj L
loyd
Insu
latio
ns L
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--
-52
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-B
istr
o H
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talit
y P
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e Li
mite
d-
-68
,000
--
-68
,000
Join
t Ven
ture
sA
ssoc
iate
sK
ey m
anag
emen
tE
nte
rpri
ses
ove
r w
hic
hT
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lp
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sig
nif
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t In
flu
ence
(Rs.
in ‘0
00)
(Rs.
in ‘0
00)
(Rs.
in ‘0
00)
(Rs.
in ‘0
00)
(Rs.
in ‘0
00)
Mar
chM
arch
Mar
chM
arch
Mar
chM
arch
Mar
chM
arch
Mar
chM
arch
31, 2
007
31, 2
006
31, 2
007
31, 2
006
31, 2
007
31, 2
006
31, 2
007
31,
200
631
, 200
731
, 200
6
| 138 |
21. Details of the Company’s share in Joint Ventures included in the Consolidated Financial Statements are as follows:
(Rs. in ‘000)
Particulars March 31, 2007 March 31, 2006
Sources of Funds
Reserves & Surplus * 55,142 (34)
Loan Funds
Secured Loans 371,226 315,724
Deferred Tax Liability 14 —
TOTAL 426,382 315,690
Application of Funds
Fixed Assets Net Block 1,916 —
Capital Work In Progress Including Capital Advances 493,805 308,731
Preoperative Expenditure Pending Allocation 145,048 105,115
Current Assets, Loans & Advances
Inventories 2,016 —
Sundry Debtors 239,903 3,214
Cash and Bank Balances 188,209 22,169
Loans and Advances 11,589 95
441,717 25,478
Less: Current Liabilities & Provisions
Current Liabilities 833,943 25,290
Net Current Assets (392,226) 188
Miscellaneous Expenditure 93 92
(To the extent not written off or adjusted)
TOTAL 248,636 414,126
* After elimination of Share Capital, Inter Company transactions and balances and adjustment of accounting policiesaggregating Rs. 155,379 thousand (previous year Rs. 132,475 thousand)
Particulars March 31, 2007 March 31, 2006
Income
Sales & Contracts Revenue 239,621 –Other Income 338 –
TOTAL 239,959 –
ExpenditureMaterials Consumed and Cost Of Goods Sold 143,367 –Project and Administrative Expenses 52,876 5,228Financial Charges 166 (5)Depreciation /Amortization 103 –
TOTAL 196,512 5,223
Profit Before Tax 43,447 (5,223)Current Tax 127 –Fringe Benefit Tax (73) –Deferred Tax (14) –Profit After Tax 43,487 (5,223)
A n n u a l R e v i e w 2 0 0 6 - 0 7 | 139 |
22. Prior period items debited / (credited) to respective account heads aggregate to Rs. 40,060 thousand (net debit) (Previousyear Rs. 33,585 thousand (net debit)).
23. Previous year comparatives
1) Previous year’s figures have been regrouped wherever considered necessary to conform to this year’s classification.
2) Figures pertaining to Subsidiaries, Joint Ventures and Associate companies have been reclassified wherever considerednecessary to bring them in line with the holding Company’s financial statements. As further elaborated in Note 1appearing above, there have been significant changes in the Group structure during the current year due to acquisitionof Sembawang Engineers & Constructors Group through a Special Purpose Vehicle, Punj Lloyd Pte Ltd., which isbased in Singapore. Accordingly, the current year figures are not strictly comparable with those of the previous year.
As per our report of even date For and on behalf of the Board of Directors of
S. R. BATLIBOI & CO. PUNJ LLOYD LIMITEDChartered Accountantsper Raj Agrawal V.K. Kaushik Atul PunjPartner Managing Director ChairmanMembership No. 82028
Dinesh Thairani Raju Kaul Ravi KeswaniPlace : Gurgaon Company Secretary Executive ExecutiveDate : May 31, 2007 Vice President Vice President
| 140 |
CONSOLIDATED CASH FLOW STATEMENT OF PUNJ LLOYD LIMITED AND ITS SUBSIDIARIES AS AT MARCH 31, 2007(Amount in INR ‘000)
Year ended Year ended March 31, 2007 March 31, 2006
A Cash Flow From Operating ActivitiesProfit before Tax 2,649,923 830,996Adjustment for:Depreciation/Amortisation 1,061,506 603,700(Profit)/Loss on Sale of Fixed Assets (Net) (12,908) 34,641Profit on sale of non trade Long Term Investments (Net) (11,000) (22,614)Interest Income (306,059) (50,187)Dividend on Long Term Investments (296) (6,093)Diminution in value of Long Term Investments – 449Interest Expenses 825,418 626,695Foreign Exchange Fluctuation (net) (114,054) (2,369)Bad Debts/Advances recovered/written off/Liabilities written back (Net) (44,499) (29,841)Provision for Doubtful Debts/Advances/Other Current Assets 118,848 58,222Operating profit before working capital changes 4,166,879 2,041,414Movement in Working CapitalIncrease in Sundry Debtors (2,257,957) (777,064)Increase in Loans and Advances (8,548,345) (196,328)Increase in Other Current Assets (485,056) (43,738)Increase in Inventories (3,795,606) (2,532,916)Increase in Current Liabilities & Provisions 12,078,599 1,797,792Cash generated from operations 1,158,513 289,160Direct Taxes Paid (641,111) (287,459)Net Cash from Operating Activities 517,402 1,701
B Cash flow from Investing ActivitiesPurchase of Fixed Assets (5,124,091) (2,556,357)Purchase of Investments (1,223,679) (200,000)Cash outflow on acquisition of Subsidiary (2,581,432) –Proceeds from sale of Investments 121,069 70,757Proceeds from Divestment of Subsidiary 9,401 –Proceeds from sale of Fixed Assets 330,912 71,349Dividend Received 296 6,093Interest Received 384,855 36,557Net Cash used in Investing activities (8,082,669) (2,571,601)
C Cash flow from Financing ActivitiesIncrease in Share Capital 323 83,552Share Issue Expenses (98,149) (305,097)Increase in Premium on issue of Share Capital 19,983 5,765,070Increase in Short Term Working Capital Loans (Net) 2,360,476 708,615Proceeds from in Long Term Borrowings 10,709,877 1,280,122Repayment of Long Term Borrowings (1,484,864) (3,584,538)Redemption of Debentures – (26,120)Interest paid (813,892) (628,205)Dividend Paid (59,129) (14,864)Taxes on Dividend Paid (7,324) (3,374)Net Cash from Financing activities 10,627,301 3,275,161Net increase in cash and cash equivalents (A+B+C) 3,062,034 705,261Foreign Currency Translation adjustments (14,013) (15,415)Adjustment on dilution of stake in and winding up of subsidiaries (2,004) –Adjustment on acquisition of subsidiaries during the year 5,859,132 –Cash and cash equivalents at the beginning of year 1,121,647 431,801Cash and Cash equivalents at end of year 10,026,796 1,121,647Components of Cash and Cash equivalents :Cash and Cheques in Hand 39,155 32,156Balances with Scheduled Banks- Current Accounts 316,850 134,373- Cash Credit Accounts 166,092 15,193- EEFC Accounts 374,023 2,100- Fixed Deposits 2,075,597 27,120Balances with Non Scheduled Banks- Current Accounts 1,449,911 874,179- Fixed Deposits 5,605,168 36,526
10,026,796 1,121,647
1. The Consolidated Cash Flow Statement has been prepared under indirect method as set out in Accounting Standard-3 on Cash Flow Statement issued by theInstitute of Chartered Accountants of India.
2. Negative figures have been shown in brackets .
As per our report of even date For and on behalf of the Board of Directors ofS. R. BATLIBOI & CO. PUNJ LLOYD LIMITEDChartered Accountantsper Raj Agrawal V.K. Kaushik Atul PunjPartner Managing Director ChairmanMembership No. 82028 Dinesh Thairani Raju Kaul Ravi KeswaniPlace : Gurgaon Company Secretary Executive ExecutiveDate : May 31, 2007 Vice President Vice President
Our VisionTo be among the top fi ve EPC companies
in the markets we serve by the year 2012
Our PledgeSafety of People Protection of Environment
Quality of Service Success of the Project
Assurance of Speed Control of Costs
R E G I S T E R E D O F F I C E
Punj Lloyd Ltd.Punj Lloyd House, 17-18 Nehru Place, New Delhi 110 019, India
T +91 11 26466105 F +91 11 26427812
www.punjlloyd.com
C O R P O R AT E O F F I C E I
78 Institutional Area, Sector 32, Gurgaon 122001, India
T +91 124 2620123 F +91 124 2620111
C O R P O R AT E O F F I C E I I
95 Institutional Area, Sector 32, Gurgaon 122001, India
T +91 124 2620123 F +91 124 2620777
Simon Carves Ltd.Sim Chem House, Warren Road, Cheadle Hulme, Cheadle
Cheshire SK8 5BR UK
T +44 161 486 4000 F +44 161 486 1302
Sembawang Engineers & Constructors Pte. Ltd.460 Alexandra Road, PSA Building Unit 27-01
Singapore 119963
T +65 6305 8788 F +65 6305 8568
S O U T H A S I A
Punj Lloyd Ltd.Banmore Industrial Area, Banmore
District Morena 476444, MP, India
T +91 7532 243644
F +91 7532 243297
Punj Lloyd Ltd.1 TV Industrial Estate
S K Ahire Marg, Worli
Mumbai 400 025
T +91 22 66602835
F +91 22 24936861
A S I A PA C I F I C
PT. Punj Lloyd Indonesia Ventura Building, 4th Flr.
Suite 401B Jl. R A Kartini 26 Cilandak
Jakarta 12430 Indonesia
T +6221 75 91 4766
F +6221 75 914 241
Punj Lloyd Pte. Ltd. 25 International Business Park
#04-18/19 German Centre
Singapore 609916
T +65 6562 9042 / 43
F +65 6562 9044
asiapacifi [email protected]
Punj Lloyd Ltd. 6th Flr., 68 Hoang Dieu Street
Ward 12, Distt. 4, Ho Chi Min City
Vietnam 115 093
T +84902410951
C E N T R A L A S I A
Punj Lloyd Kazakhstan LLP 11 B, Srym Datov Street
Atyrau, Kazakhstan
Republic of Kazakhstan
T +7 3122 35 46 48 / 57 / 58 / 59
F +7 3122 354687
M I D D L E E A S T
Punj Lloyd Ltd.PO Box 28907
501-504 Al Gaith Tower
Hamdan Street, Abu Dhabi, UAE
T +971 2 6261604
F +971 2 6267789
Punj Lloyd Ltd.PO Box 55174, #6, 2nd Flr.
Hussain Fikri and Sons Building
C - Ring Road, Doha
State of Qatar
T/F +974 427 0822
Punj Lloyd Ltd.PO Box 704, Postal Code 133
Al Khuwair, Sultanate of Oman
T +968 24 597728
F +968 24 597493
Punj Lloyd Ltd.PO Box 50082, Mukkalla
Republic of Yemen
T +967 5 384 386
F +967 5 212 022
Dayim Punj Lloyd ConstructionContracting Co. Ltd. P O Box 31909, Al Khobar 31952
Kingdom of Saudi Arabia
T +966 3 864 9141
F +966 3 864 6990
A F R I C A
Punj Lloyd Ltd.PO Box 3119, Goth
Ashaal Alwahda Area
Tripoli - G.S.P.L.A.J
Tripoli, Libya
T/F +218 21 438 5545
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Annual Review 2006-07
