b) Equipment loans from financial institution of Rs, 125.18 lakhs (March 31, 2017 : Rs, 38.54 lakhs) carries an interest rate of 10.70% - 11.90% p.a. The loan is repayable in 23 - 46 monthly installments along with interest. The loans are secured by way of hypothecation of the respective equipments.
* Refer to Note 24 for Current Portion of Mobilisation advance.
* Mobilisation Advance from MEP Infrastructure Private Limited (subsidiary company) Rs, 22,891.07 lakhs (previous year : Rs, 21,983.78 lakhs) pursuant to a contract for maintenance of structures, flyovers etc at five Mumbai Entry Points.
* Mobilisation Advance from MEP Nagpur Ring Road 1 Private Limited (Jointly Controlled Entity) Rs, Nil (previous year : 3,421.59 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
* Mobilisation Advance from MEP Sanjose Nagpur Ring Road 2 Private Limited (Jointly Controlled Entity) Rs, Nil (previous year : Rs, 4,572.61 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
* Mobilisation Advance from MEP Sanjose Arawali Kante Road Private Limited (Jointly Controlled Entity) Rs, 268.11 lakhs (previous year : Rs, 4,657.12 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
* Mobilisation Advance from MEP Sanjose Kante Waked Road Private Limited (Jointly Controlled Entity) Rs, Nil (previous year : Rs, 6,068.31 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
* Mobilisation Advance from MEP Sanjose Talaja Mahuva Road Private Limited (Jointly Controlled Entity) Rs, Nil (previous year : Rs, 526.53 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
* Mobilisation Advance from MEP Sanjose Mahuva Kagavadar Road Private Limited (Jointly Controlled Entity) Rs, Nil (previous year : Rs, 234.79 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
Refer to Note 32 for liquidity risk.
Nature of Security and terms of repayment (I) Short Term Secured borrowings
A) Term Loans from bank amounting Rs, Nil (March 31, 2017 : Rs, 3,350.00 lakhs) is secured as below:
(a) First and pari passu charge on entire fixed/current assets of the Company which are not exclusively charged to other Banks/ Lenders.
(b) First charge / hypothecation / assignment of security interest on Escrow account of the projects financed;
(c) First charge by way of hypothecation of all the movable assets, present and future, of the projects financed.
(d) Debt Service Reserve Account (DSRA) to be maintained for an amount equivalent to the 3 months of interest servicing.
(e) Corporate guarantee given by Ideal Toll and Infrastructure Private Limited;
(f) Personal Guarantee given by Mr. Jayant D. Mhaiskar director of the Company; The term loan carries an interest rate calculated on base rate of the bank plus a spread of 2.30% p.a. The loan is repayable in bullet upon release of Bid/Performance Security by the Authority of the project financed.
B) Term Loans from bank amounting Rs, Nil (March 31, 2017 : Rs, 386.58 lakhs) is secured as below:
(a) by Hypothecation / assignment of receivables to be generated from the Toll collection at Saukala toll plaza ;
(b) 1pari passu charge on the project cash flows of saukala toll collection project with the BG issuing bank and exclusive charge over the performance security deposit with NHAI,
(c) First charge by way of hypothecation of all the movable assets, present and future, of the projects financed.
(d) Personal Guarantee given by Mr. Jayant D. Mhaiskar and Mrs. Anuya J. Mhaiskar, director of the Company; The term loan carries an interest rate calculated on base rate of the bank plus a spread of 3.25% p.a. below PLR. The loan is repayable in 12 monthly installments from the date of first disbursement commencing from October 2016.
C) Term Loans from bank amounting Rs, Nil (March 31, 2017 : Rs, 415.60 lakhs) is secured as below :
(a) by Hypothecation / assignment of receivables to be generated from the Brijghat Toll collection account of the projects financed;
(b) by Hypothecation of other movable assets, like toll equipment and performance security deposit receivable;
(c) Personal Guarantee given by Mr. Jayant D. Mhaiskar, Director of the Company; The term loan carries an interest rate calculated on rate of 11.90 % p.a. (floating) at monthly rest. The loan is repayable in 12 monthly installments commencing from February 2017.
D) Term Loans from bank amounting Rs, 402.50 lakhs (March 31, 2017 : ' Nil) is secured as below :
(a) by Hypothecation / assignment of receivables to be generated from the Chennasamudram Toll collection account of the projects financed;
(b) by Hypothecation of other movable assets, like toll equipment and performance security deposit receivable;
(c) Personal Guarantee given by Mr. Jayant D. Mhaiskar, Director of the Company; The term loan carries an interest rate calculated on rate of 11.90 % p.a. (floating) at monthly rest. The loan is repayable in 12 monthly installments commencing from October 2017.
E) Term Loans from financial institution amounting Rs, Nil (March 31, 2017 : Rs, 300.00 lakhs) is secured by Pledge of shares of the Company to provide 2.5 times of security. The term loan carries an interest rate 18.00% p.a. The loan is repayable in 61 days from the date of disbursement commencing from 17 May 2017.
F) Term Loans from financial institution amounting Rs, 408.33 lakhs (March 31, 2017 : Rs, Nil).
The term loan carries an interest rate 12.25% p.a. The loan is repayable in 11 monthly installments commencing from November 2017. The loan is secured against respective equipments.
* Mobilisation Advance from MEP Infrastructure Private Limited (Subsidiary company) Rs, 1,875.52 lakhs (previous year : Rs, 1,568.12 lakhs) pursuant to a contract for maintenance of structures, flyovers etc at five Mumbai Entry Points.
* Mobilisation Advance from MEP Nagpur Ring Road 1 Private Limited (Jointly Controlled Entity) Rs, 5,068.14 lakhs (previous year : Rs, 3,858.39 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
* Mobilisation Advance from MEP Sanjose Nagpur Ring Road 2 Private Limited (Jointly Controlled Entity) Rs, 7,256.05 lakhs (previous year : Rs, 4,220.88 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
* Mobilisation Advance from MEP Sanjose Arawali Kante Road Private Limited (Jointly Controlled Entity) Rs, 6,175.82 lakhs (previous year : Rs, 2,507.68 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
* Mobilisation Advance from MEP Sanjose Kante Waked Road Private Limited (Jointly Controlled Entity) Rs, 8,116.76 lakhs (previous year : Rs, 2,855.67 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
* Mobilisation Advance from MEP Sanjose Talaja Mahuva Road Private Limited (Jointly Controlled Entity) Rs, 7,998.57 lakhs (previous year : Rs, 351.02 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
* Mobilisation Advance from MEP Sanjose Mahuva Kagavadar Road Private Limited (Jointly Controlled Entity) Rs, 6,569.01 lakhs (previous year : Rs, 126.43 lakhs) pursuant to a contract, pertaining to Construction of road under Hybrid annuity model.
note 1- financial RISK management
The Company has exposure to the following risks arising from financial instruments:
- Credit risk;
- Liquidity risk; and
- Market risk
i. Risk management framework
The Company’s board of directors is primarily responsible to develop and monitor Company’s Risk Management framework. The Company has a risk management policy in place.
The Company’s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company’s activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.
ii. credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations.
Credit risk on its receivables is recognized on the statement of financial position at the carrying amount of those receivable assets, net of any provisions for doubtful debts. Receivable balances and deposit balances are monitored on a monthly basis with the result that the Company’s exposure to bad debts is not considered to be material.
The Company has no significant concentrations of credit risk. It has policies in place to ensure that sale transactions are made to customers with an appropriate credit history.
The Company does not have any credit risk outside India.
Management believes that the unimpaired amounts that are past due by more than 30 days are still collectible in full, based on historical payment behaviour and extensive analysis of customer credit risk. cash equivalents & Other bank balances/deposits
The Company held cash equivalents and other bank balances/deposits of ' 6,474.54 lakhs at March 31, 2018 (March 31, 2017 : ' 6,403.85 lakhs). The cash equivalents and other bank balances/deposits are held with banks with good credit ratings.
iii. Liquidity risk
Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time, or at a reasonable price. The Company’s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related such risk are overseen by senior management. Management monitors the Company’s net liquidity position through rolling forecasts on the basis of expected cash flows.
iv. Market risk
Market risk is the risk that changes in market prices - such as foreign exchange rates, interest rates will affect the Company’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.
iv (a). Currency risk:
The risk that the value of a financial instrument will fluctuate because of changes in foreign exchange rates. Since company does not have any foreign exchange transactions, it is not exposed to this risk.
iv (b). Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s long-term debt obligations with floating interest rates.
NOTE 2 - SEGMENT INFORMATION
primary business segments:
The Company has identified business segments in accordance with Indian Accounting Standard 108 "Operating Segment" notified under section 133 of Companies Act 2013, read together with relevant rules issued thereunder. Accordingly, the Company has identified two business segments as mentioned below:
Toll collection, Operation & Maintenance:
Collection of toll as per the contracts entered with various Government authorities and providing road repairs and maintenance of flyovers, roads and allied structures to its subsidiaries.
construction:
Construction of roads as per the Engineering, Procurement and Construction (EPC) Contracts entered into with its Jointly Controlled Entities.
The following tables present revenue and profit information regarding the business segments for the year ended March 31, 2018 and March 31, 2017 and certain asset and liability information regarding industry segments as at March 31, 2018 and March 31, 2017.
NOTE 3- RELATED PARTY DISCLOSURES
A) Names of related parties where control exists
Subsidiary Companies MEP Infrastructure Private Limited
Raima Ventures Private Limited
Rideema Toll Private Limited
MEP Nagzari Toll Road Private Limited
MEP IRDP Solapur Toll Road Private Limited
MEP Highway Solutions Private Limited
Rideema Toll Bridge Private Limited
Raima Toll Road Private Limited
MEP Hyderabad Bangalore Toll Road Private Limited
MEP Chennai Bypass Toll Road Private Limited
MEP RGSL Toll Bridge Private Limited
MEP Tormato Private Limited
Raima Toll and Infrastructure Private Limited
MEP Infraprojects Private Limited
MEP Toll & Infrastructure Private Limited
MEP Infra Constructions Private Limited
Mhaiskar Toll Road Private Limited
MEP Roads & Bridges Private Limited
MEP Foundation (6th July, 2016 onwards)
Step down Subsidiaries Baramati Tollways Private Limited (a subsidiary of Rideema Toll Private Limited)
Associate Concern Ideal Toll & Infrastructure Private Limited
A J Tolls Private Limited
Jointly Controlled Entities KVM Technology Solutions Private Limited
SMYR Consortium LLP
MEP Sanjose Arawali Kante Road Private Limited MEP Sanjose Kante Waked Road Private Limited MEP Sanjose Nagpur Ring Road 2 Private Limited MEP Nagpur Ring Road 1 Private Limited MEP Sanjose Mahuva Kagavadar Road Private Limited MEP Sanjose Talaja Mahuva Road Private Limited MEPIDL Enterprises LLC
Other related parties with whom transactions have taken place during the year
key management personnel (KMp) Mr. Jayant Mhaiskar
Mr. Murzash Manekshana Mr. M. Sankaranarayanan Mr. Pandurang B Dandawate Mr. Harshad Pusalkar
Enterprises owned or significantly influenced / controlled IEPL Power Trading Company Private Limited by key management personnel or their relatives where Ideal Energy Projects Limited there are transactions. MEP Toll Gates Private Limited
VCR Toll Services Private Limited MEP Infracon Private Limited Rideema Enterprises.
Jan Transport D S Enterprises
NOTE 4 - DOMESTIC TRANSFER PRICING
The Indian Finance Bill, 2012 had sought to bring in certain class of domestic transactions in the ambit of the transfer pricing regulations with effect from 1 April 2012. The Company’s management is of the opinion that its domestic transaction are at arm’s length so that appropriate legislation will not have an impact on financial statements, particularly on the amount of tax expense and that of provision for taxation. The Company does not have any international transactions with related parties during the year. Note 43 - Employee Benefits
Defined Contribution Plan
The Company makes provident fund, Employees State Insurance and Maharashtra Labour Welfare Fund contributions for eligible employees. Under the schemes, the Company is required to contribute a specified percentage / fixed amount of the payroll costs to fund the benefits. The contributions as specified under the law are paid to the respective fund set up by the government authority.
The Company has recognized the following amounts in the Statement of Profit and Loss for the year *
Notes:
1. Discount rate
The discount rate is based on the prevailing market yields of Indian government securities for the estimated term of the obligations.
2. Salary escalation rate
The estimates of future salary i
increases considered takes into account the inflation, seniority, promotion and other relevant factors.
3. Assumptions regarding future mortality experience are set in accordance with the statistics published by the Life Insurance Corporation of India.
The above sensitivity analyses have been calculated to show the movement in defined benefit obligation in isolation and assuming there are no other changes in market conditions at the reporting date. In practice, generally it does not occur. When we change one variable, it affects to others In calculating the sensitivity, project unit credit method at the end of the reporting period has been applied.
The weighted average duration of the defined benefit obligation is 3.13 years in 2018 and 10.74 years in 2017
The Company makes payment of liabilities from its cash and cash equivalent balances whenever liability arises.
Out of issue proceeds of Rs, 1,61,79.57 lakhs received from the QIP in April, 2018, Rs, 511.31 lakhs were utilized towards share issue expenses and ' 15,668.26 lakhs were utilized for the purpose as stated in the ‘Placement Document’ and there is no unutilized amount pending utilization. The information is given pursuant to Regulation 32 of the SEBI (Listing Obligations and Disclosure Requirements) (LODR) Regulations, 2015.
NOTE 5
Previous year comparatives
Figures relating to the previous period have been regrouped / rearranged, wherever necessary, to make them comparable with those of the current period.
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