Mr. A. M. Naik, L&T’s Chairman & Managing Director, receives the Padma Bhushan from the President
of India, Mrs. Pratibha Patil, on March 31, 2009.
The Padma Bhushan
Leading a company that is helping to
build the nation is a matter of pride in
itself. To receive high national
recognition for this service is indeed
heartening. It will be my privilege to
accept the Padma Bhushan on behalf
of all the employees of the Company
for whom the L&T story is always
interwoven with the larger interests of
India.
- - Mr A.M. Naik on receiving
the Padma Bhushan
Dear Shareholders,
The year gone by witnessed
unprecedented global economic and
business turbulence. While your
Company has managed to maintain
its growth trajectory during 2008-
2009, the last six months have been
a challenging period as decisions on
awarding projects were repeatedly
deferred on account of the economic
slowdown and due to the code of
conduct applicable to public sector
bodies prior to the elections in May
2009. With a stable Government now
in place and priority being accorded
to infrastructure, it is expected that
capital expenditure in this sector will
increase and new business prospects
will fructify in the later part of this
year.
2008-2009, giving us some revenue
It gives me pleasure to mention that
visibility going forward. In the year
your Company has recommended a
under review, Net Sales touched Rs.
dividend of Rs. 10.50 per equity share
33,600 crore - which translates into a
of a face value of Rs. 2 per share for the
growth of 35% over 2007-2008.
year on the expanded share capital
Margins remained relatively stable, and
post-bonus issue of 1:1 during the year.
Profit after Tax (PAT) excluding
The corresponding dividend during
exceptional items of expense and
the previous fiscal, adjusted for Bonus
income grew by a healthy 29% year
issue in 2008-2009 for comparison
on year. Growth in PAT including
purposes, stood at Rs. 8.50 per equity
exceptional items stood at 63%.
share.
1
A. M. Naik
Chairman & Managing Director
Performance Overview
Your Company has performed well
despite the adverse scenario in 2008-
2009. Order Inflows grew by 23% over
2007-2008, and in line with our efforts
to diversify the geographical spread of
our businesses, international orders
constituted 15% of the total Order
Inflows. The Middle East continues to
be a focus area for us and we have
enhanced our footprint in the GCC
Region. The Order Book position stood
at Rs. 70,300 crore at the end of
Sustaining Profitable Growth:
Last year we had put in a slew of
measures to accelerate growth in a
profitable manner and we hope to
return to this growth path in the near
term future.
(cid:2) Organization Structure:
An internal reorganization has
now been completed where
complementary business units
have been organized under
vertically integrated businesses
termed ‘Operating Companies’
(OCs). These OCs have their own
internal Boards and embedded
shared service functions such as
HR, Resource Support and Finance
& Accounts to enable self-
sufficiency. The new structure
opens up opportunities for
leadership development, provides
a platform for nurturing internal
resources and is expected to
provide focus to businesses within
each OC. The structure aims to
shareholder value
enhance
creation.
(cid:2)
Talent Management:
The adverse economic conditions
have worked to our advantage in
enabling us to position L&T as a
stable career destination. We have
bolstered our talent recruitment
drives to meet our growing
business needs. Steps have been
taken to meet the challenges of
retention, skill upgradation,
remuneration and the career
aspirations of talent on our rolls.
structured
These
include
2
induction paths, capability
building programs, differentiated
reward
career
systems,
progression plans and leadership
development programs including
succession planning. We are
confident that the measures now
being taken will enhance the
talent
effectiveness of our
management initiatives.
businesses to run efficiently and
IT
also build cutting edge
solutions. IT activities in the
Company are effectively governed
within a structured framework
IT–business
with
alignment, value delivery, risk
management, service & support
and total cost of ownership.
focus on
(cid:2)
Capacity Expansion:
(cid:2)
Technology:
Technology continues to be the
cornerstone of our business
model, and your Company prides
itself on being able to leverage
for
technological offerings
profitable business growth.
Alliances with
international
technology partners enable us to
fill capability gaps and access
expertise wherever we do not
possess the requisite in-house
resources, either on long-term or
on project-specific basis. Examples
of such tie-ups are our recent JV
with EADS to exploit opportunities
in Defense, and the MOUs with
Westinghouse Electric Company
(USA), Atomic Energy Commission
(Canada),
Limited
Atomstroyexport (Russia) and GE
Hitachi Nuclear Energy (USA) in
the area of Nuclear Power.
(cid:2)
IT in Business:
Your Company believes
in
investing in IT as a business
enabler. IT outlay over the years
have been directed towards a
balanced mix of hygiene spends
and payoff spends that enable our
our
Your Company has taken proactive
steps in setting up manufacturing
capacities ahead of demand
triggers. A new modular
fabrication facility in Oman is fully
functional, enabling us to bid for
significantly large hydrocarbon
projects in the international arena.
A heavy engineering workshop
adjoining this facility that will
augment
global
manufacturing capabilities is due
to become operational later this
year. Plans to manufacture super-
critical power plant equipment in
collaboration with Mitsubishi
Heavy Industries, Japan are well on
track, and these plants would
come on stream at Hazira in
with
Gujarat,
commissioning of the boiler
manufacturing unit this year.
Manufacturing capacity in MV
switchgear has been augmented
in Ahmednagar, Maharashtra and
is expected to drive growth
impetus in our Electrical and
Automation OC. Our heavy
engineering workshop
in
Talegaon in Maharashtra has
become operational and will
beginning
enhance our manufacturing
capabilities for the defence
sector. We have commenced
setting up of a shipyard at
Kattupalli near Ennore in South
India which will enable us to
manufacture defense ships and
later undertake repairs of
commercial ships. We also plan to
set up a heavy forge shop that
will cater to nuclear and process
plants forgings, an area where we
were hitherto dependent on
international vendors.
Outlook:
While no country is insulated from the
impact of the global meltdown,
India’s economy provides relatively
greater stability. The business
environment however, continues to
be challenging and we foresee a
return to robust growth conditions
after economic recovery takes root.
Your Company has planted seeds of
growth in sectors likely to receive
focused attention. These include:
(cid:2) Hydrocarbon business – both in
the upstream oil and gas
exploration / extraction and in
midstream refineries. Increased
capacity in the Middle East is
likely to yield some growth in this
sector in years to come.
(cid:2)
Availability of gas from the KG
Basin along with high gas
allocation to the fertilizer sector
affords
in
feedstock
naphtha-to-gas
conversion prospects and
opportunities
(cid:2)
brownfield expansion plans of
fertilizer companies.
Road projects have started
receiving focused Government
attention and are likely to
witness increased awards on BOT
basis. This is an area where we
can leverage past record, scale,
design strength and execution
capability as and when tenders
are floated as a first step towards
final award of these projects.
(cid:2) We intend to leverage our strong
track record in the area of
evacuation, storage, treatment
and transmission of bulk water to
exploit emerging opportunities
in states that are water-deficit.
(cid:2)
(cid:2)
Increased demand for power as
a pre-requisite for economic
development offers good
potential for us in future. Our
power
equipment
manufacturing venture is an
integral part of our efforts to
grow this business in years to
come and we have started
receiving large orders in this
space.
In the recent past, your Company
has received orders of a diverse
nature in the railway business,
which include contracts from the
Indian Railways for setting up
facilities for manufacture of
rolling stock, railway sidings for
private
players,
sector
electrification of rail corridors,
intra-city metro and monorails.
Coupled with
significant
spending likely to take place on
Dedicated Freight Corridors for
the Railways, this sector is
perceived by us to hold good
growth potential in years to
come.
(cid:2) Nuclear Power Generation,
which is slated to grow by an
order of magnitude over the next
decade and more, can spell
major growth opportunities for
us in the long term.
(cid:2) Defense Sector, when privatized,
will offer large business potential
and this is an area where your
Company is well positioned.
Before I conclude, I would like to
thank all L&T-ites for the support and
continued commitment which is
helping us to navigate through these
difficult times. I would also like to
express my gratitude
to my
colleagues, our customers, business
and
associates,
members of the Board for their
valuable assistance. We will continue
to work
for enhancement of
stakeholder value, and remain
committed to justifying the faith and
trust you have reposed in us.
shareholders
With best wishes,
A. M. Naik
Chairman & Managing Director
Mumbai, May 28, 2009
3
Contents
Company Information
Organisation Structure
Leadership Team
People
Technology Thrust
International Operations
Corporate Social Responsibilities
Powering Growth Accelerating Development
L&T’s Nationwide Network & Global Presence
Standalone Financials - 10 Year Highlights
Consolidated Financials - Highlights
Graphs
Director’s Report
Management Discussion & Analysis
Auditor’s Report
Balance Sheet
Profit and Loss Account
Cashflow Statement
Schedules forming part of Accounts
Notes forming part of Accounts
5
6
7
8
9
10
11
12-13
14-15
16
17
18-19
21-47
48-100
101-103
104
105
106
107-135
136-171
Statement pursuant to Section 212 of the Companies Act, 1956
172-178
Information on Subsidiary Companies
179-191
Auditors’ Report on Consolidated Financial Statements
Consolidated Balance Sheet
Consolidated Profit and Loss Account
Consolidated Cashflow Statement
Schedules forming part of Consolidated Accounts
Notes forming part of Consolidated Accounts
193
194
195
196
197-216
217-242
4
L&T’s Corporate Office in Mumbai
ormationtiontiontiontion
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A. M. Naik
J. P. Nayak
Y. M. Deosthalee
K. Venkataramanan
R. N. Mukhija
K. V. Rangaswami
V. K. Magapu
M. V. Kotwal
S. Rajgopal
S. N. Talwar
M. M. Chitale
Thomas Mathew T.
N. Mohan Raj
Subodh Bhargava
Bhagyam Ramani (Mrs)
A. K. Jain
J. S. Bindra
Company Secretary
N. Hariharan
Chairman & Managing Director
Whole-time Director & President
(Machinery & Industrial Products)
Whole-time Director &
Chief Financial Officer
Whole-time Director & President
(Engineering & Construction Projects)
Whole-time Director & President
(Electricals & Electronics)
Whole-time Director & President
(Construction)
Whole-time Director & Senior
Executive Vice President
(IT & Technology Services)
Whole-time Director & Senior
Executive Vice President
(Heavy Engineering)
Non-Executive Director
Non-Executive Director
Non-Executive Director
Nominee - LIC
Nominee - LIC
Non-Executive Director
Nominee - GIC
Nominee - SUUTI
Non-Executive Director
Registered Office
L&T House, Ballard Estate, Mumbai - 400 001
Auditors
M/s. Sharp & Tannan
Solicitors
M/s Manilal Kher Ambalal & Co.
Registrar & Share Transfer Agents
Sharepro Services (India) Private Limited
64th ANNUAL GENERAL MEETING
AT BIRLA MATUSHRI SABHAGAR
19, MARINE LINES, MUMBAI 400 020
ON FRIDAY, AUGUST 28, 2009
AT 3.00 P.M.
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Leadership Team
(Front row - from left to right) ; Mr. Y. M. Deosthalee, Mr. A. M. Naik and Mr. J. P Nayak
(Rear - from left to right) : Mr. K. Venkataramanan, Mr. K. V. Rangaswami, Mr. M. V. Kotwal, Mr. R. N. Mukhija and Mr. V. K. Magapu
7
continuous. It is facilitated through training
modules, an e-learning portal, leadership
development strategies and soft-skills
amplification programmes. Technology is
changing the face and pace of the
workplace, and L&T ensures that its people
stay in step – and in tune – with the times.
Succession planning plays an important
part in ensuring that change does not
disrupt continuity.
Our leadership
development programmes help to mould
the leaders of tomorrow.
Employee welfare initiatives provide the
back-up support essential
job
performance. These include health care,
child education, spouse engagement, etc.
to
As L&T marches forward into the future, its
people will continue to be its driving force.
People
The driving force
L&T is its people. They have shaped its
destiny, expanded its horizons, and proved
to be the one vital differential that
distinguishes L&T from the rest.
Talent Acquisition
People are a precious asset – and also a
scarce one. At L&T, we successfully tackle
the twin challenges of talent acquisition
and attrition. Stringent recruitment
processes and procedures ensure that only
the finest talent is selected. L&T’s
academia-industry interface also helps in
projecting the L&T brand in campuses.
Post-recruitment, a number of phased
initiatives ensure that the employee aligns
his or her personal goals with the
Company’s objectives.
Talent retention
Employee retention is woven into the
company’s strategy for success. The
transformation of an employee into
someone special – an L&T-ite – is a process
that cannot be calibrated but, like the
change of seasons, happens inevitably.
Corporate initiatives that act as catalysts in
the process of change include induction
programmes, mentoring and a buddy
scheme. Skill-enhancement is also
8
L&T is widely regarded as a crucible of engineering
talent in India. Trainiing programmes and a unique
environment ensure a transformation from
‘employee’ to L&T-ite. Picture (top) shows the
serene ambience of L&T’s Management
Development Centre at Lonavla, near Mumbai.
Stringent recruitment processes
Academia-industry interface
Continuous skill enhancement
Succession planning
FAIR - Framework for linking
Appraisals with Incentives & Reward
Technology Thrust
Design gives shape to dreams
A small step in a design engineer’s
mind… a giant leap in the application of
technology.
The L&T Knowledge City at Vadodara
crystalizes the importance that the
Company attaches to knowledge-intensive
businesses. This complex will deepen and
widen L&T’s capabilities in an array of high-
tech domains.
Enhancing Capabilities
L&T has advanced design engineering
capabilities for project and product design.
Facilities at Mumbai, Chennai, Bangalore,
Faridabad, Vadodara, Sharjah and Oman
are backed by laboratories for R&D,
technology assimilation and absorption,
and design analysis.
Joint venture companies provide
engineering services for different sectors:
L&T-Valdel Engineering Limited for
upstream hydrocarbon, L&T-Chiyoda
Limited for mid- and downstream
hydrocarbon, L&T-Rambøll Consulting
Engineering Limited for transportation
infrastructure and L&T-Sargent & Lundy
Limited for power.
A Rich Harvest
In the sphere of Heavy Engineering, L&T
has designed equipment that has set world
records in terms of complexity and
technological sophistication. In the field of
electrical and electronics products and
systems, L&T’s in-house R&D and design
efforts have won significant recognition.
The electrical and electronic business has
a large number of patents to its credit. Its
offerings include a large number of new
products -- a measure of the vibrance of its
R&D.
In
the construction, mining and
earthmoving sectors, L&T collaborates with
global majors like Komatsu and Case NH to
bring to Indian industry the benefits of
contemporary technology.
Top: L&T Knowledge City at Vadodara.
Above: 3-D model of a cracking furnace.
Designing the Future
Front-end Engineering & Design
Technology is the key to the future. As the
company stretches outwards and upwards
to expand and grow, design and
engineering will give it the impetus to soar.
Engineering Centres
Intensive R&D laboratories
Joint ventures for several sectors
409 patent applications for switchgear
filed from 2003-09
9
A mark in world markets
Post the acquisition of Tamco, the
manufacturing footprint of L&T covers new
geographies. L&T now has manufacturing
facilities in Dubai, Saudi Arabia, Oman,
Malaysia, China, Indonesia and Australia.
L&T’s project and product exports cover
over 30 countries. These include countries
traditionally considered engineering
nerve-centers -- the U.S., U.K., Canada,
France and China.
With a long-term perspective of the global
arena, L&T is slated to make further inroads
into the international marketplace.
International Operations
The world is an integrated
economy.
Close to a fifth of L&T’s sales turnover comes
from sales outside India. While remaining
committed to building the nation, L&T is
simultaneously enlarging
its global
footprint -- for sound business reasons. A
wide international customer base enables
de-risking of operations.
Further,
international exposure enables L&T to
benchmark its operations against global
standards.
Multi-faceted presence
There are many dimensions to L&T’s
global presence. Collaborations with
international majors enable us to introduce
to Indian industry the benefits of the
world’s latest technologies.
Global sourcing enables us to give our
clients the global advantage – the benefit
of world-class quality at competitive prices
and to stringent delivery schedules.
Project and product exports have helped
expand our global footprint, earning
foreign exchange for the country while
building both the Indian and the L&T brand
abroad.
10
A methanol plant in Saudi Arabia -- one of several
plants set up by L&T on an EPC basis in the Middle
East and South East Asia.
Manufacturing footprint in 8 countries
Global network
World-class quality
International partnerships
Global sourcing
Corporate Social
Responsibilities
Today’s choices can lighten
tomorrow’s compulsions
L&T was one of the first engineering and
construction companies in India to publish
its Report on Corporate Sustainability. The
Company and its people are committed to
living and doing business in a manner that
will ensure sustained well-being for all.
A Key to the Future
L&T has set up Construction Skills Training
Institutes (CSTIs) at Ahmedabad, Bangalore,
Chennai, Delhi and Panvel to turn dropouts
into contributing members of their families
and of society at large. The CSTIs ensure a
steady supply of skilled labour to the
construction industry, helping it sustain its
momentum. In addition, the Larsen &
Toubro Public Charitable Trust conducts
skill training at Mumbai, Lonavala,
Aurangabad, Latur and Kharel.
Health
its
Around
factories and offices
countrywide, the company has initiated
welfare activities in the areas of health,
education and environment conservation,
with local partners. L&T’s HIV/AIDS-
prevention initiatives include awareness
camps targeted at high-risk groups,
voluntary testing and counseling. Health
camps in rural areas bring the benefits of
modern diagnostic and curative tools to the
rural poor.
Education
L&T has adopted several municipal schools
in the vicinity of its works, and enriches the
learning experience in many ways. L&T’s
own employees dedicate part of their spare
time and talent to augmenting the learning
process.
Environment
L&T has taken significant initiatives to
reduce the consumption of energy and use
‘greener ’ forms of energy at its factories.
Anti-pollution measures help minimise the
impact of industrial processes on the
environment.
CSR programmes cover primary and municipal
schools around L&T’s campuses. In addition, L&T-
eers (employee volunteers), in their own time, teach
underprivileged children. The wives of L&T-ites
undertake a broad spectrum of social work under
the aegis of numerous Ladies Clubs.
Training Institutes
Health Centres
School adoption
Energy optimisation
Anti-pollution measures
11
Accelerating Development
Commercial & Residental Complexes
Roads & Bridges
Ports & Harbours
Airports
Oil & Gas Projects
Refineries
12
Powering Growth
Power Projects
Missile & Weapon System
Process Plant Equipment
Steel Plants
Switchgear
Construction & Mining Equipment
13
A Nationwide Network
The pictorial representation does not purport to be the political map of India
14
A Global Presence
Product & Equipment Supply
Fabrication
Note: Map is broadly representative of L&T’s global presence.
15
STANDALONE FINANCIALS - 10 YEAR HIGHLIGHTS
Description
2008-2009
2007-2008
2006-2007
2005-2006
2004-2005
2003-2004
2002-2003 2001-2002
2000-2001
1999-2000
Rs. crore
7424
242
7666
6956
995
369
329
13
-
342
180
248
3616
3864
-
3974
7838
4589
774
2439
Profit and Loss Account
Gross sales & service
Other income
Gross revenues
Net sales & service
Profit before depreciation, interest
and tax [PBDIT] (excluding
extraordinary/exceptional items)
Profit before tax (excluding
34045
1020
35065
33647
25187
676
25863
24855
17901
522
18423
17567
14966
519
15485
14735
13255
732
13987
13050
9807
461
10268
9561
9870
302
10172
9360
8167
277
8444
7726
7825
310
8135
7390
4425
3318
2186
1424
1081
extraordinary/exceptional items)
3940
3068
1982
1235
Profit after tax (excluding
extraordinary/exceptional items)
Extraordinary items (net of tax)
Exceptional items (net of tax)
Profit after tax (PAT)
Dividend including dividend
distribution tax
2709
773
-
3482
2099
-
74
2173
1385
-
18
1403
863
70
79
1012
720^
572
428
349
Balance Sheet
Share capital
Reserves
Net worth
Deferred tax liability (net)
Loan funds
Capital employed
Net fixed assets
Investments
Net working capital (NWC)
Miscellaneous expenditure
117
12343
12460
48
6556
19064
5195
8264
5605
58
9497
9555
61
3584
13200
3645
6922
2630
(to the extent not written-off)
–
3
57
5711
5768
40
2078
7886
2225
3104
2547
10
27
4613
4640
77
1454
6171
1605
1920
2625
21
933
631
-
353
984
407
26
3343
3369
95
1859
5323
1083
961
3238
41
890
769
533
-
-
533
225
25
2750
2775
114
1324
4213
1015
966
2185
47
999
1042
1013
510
433
-
-
433
211
249
3314
3563
841
3176
7580
4056
1160
2300
401
347
-
-
347
174
249
3095
3344
853
3463
7660
4264
918
2413
339
315
-
-
315
178
249
3751
4000
-
4263
8263
4671
813
2735
64
65
44
36
Ratios and statistics
PBDIT as % of total income @
PAT before extraordinary/exceptional
items as % of total income $
ROCE % *
RONW % **
Gross Debt:Equity ratio
NWC as % of gross sales &
service
Current ratio
Basic earnings per
equity share (Rs.) #
Book value per
equity share (Rs.)
No. of equity shareholders
No. of employees
12.83
13.08
12.14
9.45
8.08
8.94
10.39
13.12
13.33
13.94
7.81
17.55
24.67
0.53:1
16.47
1.31
8.25
20.58
28.21
0.38:1
10.44
1.19
7.67
20.15
26.84
0.36:1
14.23
1.27
5.69
16.05
21.88
0.32:1
17.54
1.38
4.70
14.17
21.05
0.56:1
24.43
1.58
5.32
13.52
20.66
0.49:1
22.28
1.47
4.48
7.27
12.91
0.92:1
23.30
1.58
4.34
6.84
9.69
1.07:1
30.42
1.81
4.09
6.74
8.18
1.09:1
34.95
2.11
4.57
7.38
8.85
1.05:1
32.85
2.07
59.50
37.80
25.11
19.02
19.41
10.71
8.71
6.98
6.34
6.87
212.31## 325.90
152.13
9,31,362 578,177 4,28,504 3,27,778 3,23,908 3,65,824 4,90,628 5,09,922 5,13,562 6,05,031
24,448
202.28## 334.01
37,357
27,191
31,941
18,996
19,848
21,873
23,148
23,988
22,922
157.31
130.25
253.91
139.15
216.74
Figures for the years 1999-2000 to 2002-2003 include demerged cement business
^ Includes dividend distribution tax of Rs.2.69 crore paid by a direct subsidiary company for which set off was availed by the parent
company as permitted under the Income Tax Act.
@ PBDIT as % of total income [(PBDIT excluding extraordinary/exceptional items)/(total income excluding extraordinary/exceptional
items and interest income)].
$ PAT before extraordinary/exceptional items as % of total income [(PAT excluding extraordinary/exceptional items)/(total income
excluding extraordinary/exceptional items)].
* ROCE [(PAT before extraordinary/exceptional items + interest - tax on interest)/(average capital employed excluding revaluation
reserve and miscellaneous expenditure)].
** RONW [(PAT before extraordinary/exceptional items)/(average net worth excluding revaluation reserve and miscellaneous
expenditure)].
# Basic earnings per equity share has been calculated including extraordinary/exceptional items and adjusted for all the years for
bonus issue in the ratio of 1:1 in the current year.
## After considering issue of bonus shares in the ratio of 1:1 during the respective years.
16
CONSOLIDATED FINANCIALS - HIGHLIGHTS
Description
2008-2009
2007-2008
2006-2007
2005-2006 2004-2005 2003-2004 2002-2003 2001-2002
Rs.crore
Profit and Loss Account
Gross sales & service
Other income
Gross revenues
Net sales & service
Profit before depreciation, interest & tax [PBDIT]
(excluding extraordinary/exceptional items)
Profit before tax (excluding extraordinary/
exceptional items)
Profit attributable to Group shareholders
(excluding extraordinary/exceptional Items)
Extraordinary items (net of tax)
Exceptional items (net of tax & minority interest)
Profit attributable to Group shareholders
Dividend including dividend distribution tax
Balance Sheet
Share capital
Reserves
Net worth
Minority interest
Loan funds
Deferred payment liabilities
Deferred tax liability (net)
Capital employed
Net fixed assets
Investments
Loans & advances towards financing activities
Net working capital (NWC)
Miscellaneous expenditure
40608
885
41493
40187
29561
684
30245
29199
20700
1071
21771
20336
16747
577
17324
16500
14599
696
15295
14379
11107
488
11595
10849
10857
267
11124
10327
9195
239
9434
8714
5398
3984
2905
1846
1367
1215
1200
1287
4344
3384
2510
1472
1052
921
469
414
3007
773
9
3789
720
117
13871
13988
1058
18400
1970
131
35547
15589
6806
7110
6042
2304
–
21
2325
572
58
10773
10831
923
12120
196
122
24192
8523
5552
6161
3927
1810
–
430
2240
428
57
6865
6922
646
6200
232
107
14107
5440
2478
2410
3762
1051
70
196
1317
349
27
4937
4964
107
3499
-
127
8697
2973
1676
1012
3011
697
–
353
1050
407
26
3290
3316
105
3454
-
138
7013
2215
615
406
3736
600
–
147
747
225
25
2622
2647
54
2769
-
214
5684
2140
624
375
2498
380
–
–
380
211
249
2968
3217
50
4701
-
913
8881
5539
528
323
2392
290
–
–
290
174
249
2889
3138
44
4978
-
928
9088
5824
358
218
2613
(to the extent not written-off)
–
29
17
25
41
47
99
75
Ratios and statistics
PBDIT as % of total income @
PAT before extraordinary/exceptional
items as % of total income $
ROCE % *
RONW % **
Gross Debt:Equity ratio
Net Debt:Equity ratio
NWC as % to gross sales
Current ratio
Basic earnings per equity share (Rs.) #
Book value per equity share (Rs.)
13.19
13.40
13.97
11.01
9.31
10.77
11.37
14.46
7.33
12.10
24.32
1.32:1
0.84:1
14.88
1.29
64.76
7.72
14.13
26.68
1.12:1
0.57:1
13.28
1.25
40.44
238.27## 368.62
8.66
17.78
30.71
0.90:1
0.44:1
18.17
1.36
40.10
3.24
3.59
6.70
7.13
12.45
9.24
1.52:1 1.65:1
1.27:1 1.53:1
28.41
22.03
1.79
1.55
5.83
7.65
242.77## 357.43 249.75 206.33 123.98 121.64
5.29
13.02
21.24
1.08:1
0.76:1
22.49
1.50
15.01
4.73
13.84
23.96
1.06:1
0.89:1
25.59
1.64
20.70
6.25
15.89
25.78
0.71:1
0.49:1
17.98
1.40
24.75
Figures for the years 2001-2002 & 2002-2003 include demerged cement business
@ PBDIT as % of total income [(PBDIT excluding extraordinary/exceptional items)/(total income excluding extraordinary/exceptional items
and interest income)].
$ PAT before extraordinary/exceptional items as % of total income [(PAT excluding extraordinary/exceptional items)/(total income excluding
extraordinary/exceptional items)].
* ROCE [{profit available for appropriation before extraordinary/exceptional items + minority interest + interest (including interest
forming part of operating expenses) - tax on interest}/(average capital employed excluding revaluation reserve and miscellaneous
expenditure)].
** RONW [(profit available for appropriation before extraordinary/exceptional items)/(average net worth excluding revaluation reserve
and miscellaneous expenditure)].
# Basic earnings per equity share is calculated including extraordinary/exceptional items and adjusted for all the years for bonus
issue in the ratio of 1:1 in the current year.
## After considering issue of bonus shares in the ratio of 1:1 during the respective years.
17
L&T-ORDER INFLOW
L&T-SALES
L&T-PBDIT AS % OF TOTAL INCOME
L&T-INTEREST COVERAGE RATIO
L&T-PAT & EPS
L&T-FIXED ASSET TURNOVER RATIO
18
L&T-SEGMENT-WISE ORDER INFLOW 2008-2009
L&T-SEGMENT-WISE SALES 2008-2009
L&T-SEGMENT-WISE RESULT
L&T-SEGMENT-WISE EBDITA MARGINS*
L&T-SECTOR-WISE ORDER BOOK AS AT MARCH 31, 2009
L&T CONSOLIDATED SALES AND PAT
19
NOTES
Directors’ Report
The Directors have pleasure in presenting their Annual Report and
Accounts for the year ended March 31, 2009.
FINANCIAL RESULTS
Profit before depreciation
and tax
2008-2009 2007-2008
Rs. crore Rs. crore
4,246.40
3,367.07
Less: Depreciation and amortization
307.30
213.63
Add : Transfer from revaluation reserve
3,939.10
1.31
3,153.44
2.03
DIVIDEND
The Directors recommend payment of dividend of Rs. 10.50 per equity
share of Rs. 2/- each.
Shares that may be allotted on exercise of options granted under the
Employee Stock Option Schemes before the book closure for payment
of dividend will rank pari passu with the existing shares and be entitled
to receive the dividend.
DEPOSITORY SYSTEM
As the members are aware, the Company’s shares are compulsorily
tradable in electronic form. As on March 31, 2009, almost 96% of the
Company’s total paid-up capital representing 56,32,91,981 shares
are in dematerialized form. In view of the numerous advantages
offered by the depository system, members holding shares in physical
mode are advised to avail of the facility of dematerialization on either
of the depositories.
Profit before tax and extraordinary items
3,940.41
3,155.47
CAPITAL & FINANCE
Less: Provision for tax
Profit after tax
(before extraordinary items)
Profit on sale / transfer of business
(net of tax)
Profit after tax and extraordinary items
Add : Balance brought forward from
previous year
Less: Dividend paid for the previous year
(including dividend distribution tax)
1,231.21
982.05
2,709.20
2,173.42
772.46
-
3,481.66
2,173.42
104.31
0.33
78.24
0.77
Balance available for disposal
which the Directors appropriate as follows:
3,585.64
2,250.89
Debenture redemption reserve
43.34
-
Interim dividend
-
56.83
During the year under review, the Company allotted 7,68,418 equity
shares upon exercise of stock options by the eligible employees under
the Employee Stock Option Schemes.
The shareholders of the Company approved the issue of bonus shares
in the ratio of 1:1 at the AGM held on August 29, 2008. The Company
accordingly issued 29,25,92,054 bonus shares on October 3, 2008.
During the year under review, the Company tied up foreign currency
long term loans aggregating to USD 100 million to finance ongoing
capital expenditure, investment in overseas subsidiaries and overseas
acquisitions. The loans have tenors of 5, 7 and 10 years. The
Company has also issued secured redeemable non-convertible
debentures of Rs. 900 crores, with tenor of 10 years, and unsecured
redeemable non-convertible debentures of Rs. 250 crores with tenor
of 3 years.
CAPITAL EXPENDITURE
As at March 31, 2009, the gross fixed and intangible assets, including
leased assets, stood at Rs. 6,670.78 crore and the net fixed and
intangible assets, including leased assets, at Rs. 5,194.60 crore.
Additions during the year amounted to Rs. 1,986.31 crore.
Proposed final dividend
614.97
438.49
DEPOSITS
Dividend tax
General reserve
101.83
76.26
2,725.00
1,575.00
3,485.14
2,146.58
85 deposits totalling Rs. 0.08 crore which were due for repayment on
or before March 31, 2009 were not claimed by the depositors on that
date. As on the date of this report, deposits aggregating to Rs. 0.01
crore thereof have been claimed and paid.
Balance to be carried forward
100.50
104.31
TRANSFER TO INVESTOR EDUCATION & PROTECTION FUND
Dividend
The Directors recommend payment of
dividend of Rs. 10.50 per equity share
of Rs. 2/- each on 58,56,87,862 shares
YEAR IN RETROSPECT
614.97
438.49
The gross sales and other income for the financial year under review
were Rs. 35,065 crore as against Rs. 25,863 crore for the previous
financial year registering an increase of 36%. The profit before tax
and extraordinary items (after interest and depreciation charges) of
Rs. 3,940 crore and the profit after tax (before extraordinary items) of
Rs. 2,709 crore for the financial year under review as against Rs. 3,155
crore and Rs. 2,173 crore respectively for the previous financial year,
improved by 25% in each case respectively.
During the year, the Company has transferred a sum of
Rs. 1,43,88,496 to Investor Education & Protection Fund, the amount
which was due & payable and remained unclaimed and unpaid for a
period of seven years, as provided in Section 205C(2) of the
Companies Act, 1956. Despite the reminder letters sent to each
shareholder, this amount remained unclaimed and hence was
transferred. Cumulatively, the amount transferred to the said fund as
on March 31, 2009 is Rs. 7,30,26,439.
SUBSIDIARY COMPANIES
During the year under review, the Company subscribed to / acquired
equity shares in various subsidiary companies. These subsidiaries
are either SPVs executing projects secured through BOT route, or
holding companies making investments in companies such as power
and financial services. The investment in L&T International FZE is
mainly for onward investment in international ventures. The details
21
of investments are as under:
862 equity shares of Dhs. 550,500 each in Larsen & Toubro
International FZE for Rs. 533 crore at par.
4,08,00,000 equity shares of Rs. 10 each in L&T Power
Limited at par.
1,989 equity shares of Rs. 10,000 each in International
Seaport Dredging Limited at par.
5,70,00,000 equity shares of 10 each in L&T Power
Development Limited at par.
12,40,005 equity shares of Rs. 10 each in L&T-Gulf Private
Limited at par.
10,000 equity shares of Rs. 10 each in L&T Seawoods
Private Limited at par.
100 equity shares of Rs. 10 each in L&T Chennai – Tada
Tollway Limited at par.
50,000 equity shares of Rs. 10 each in L&T Natural
Resources Limited at par.
20,50,000 equity shares of Rs. 10 each in L&T Capital
Holdings Limited at par.
1,70,00,000 equity shares of Rs. 10 each in L&T Capital
Company Limited at par.
40,000 equity shares of Rs. 10 each in Raykal Aluminium
Company Private Limited at par.
10,10,000 equity shares of Rs. 10 each in L&T Halol-
Shamlaji Tollway Private Limited at par.
10,10,000 equity shares of Rs. 10 each in L&T Rajkot-
Vadinar Tollway Private Limited at par.
10,10,000 equity shares of Rs. 10 each in L&T Ahmedabad-
Maliya Tollway Private Limited at par.
Further contribution of Re. 0.55 per share & premium of
Rs. 71.39 per share on 22,50,000 partly paid-up equity
shares in Larsen & Toubro Infotech Limited. Total paid-up
Rs. 3.75 per share, premium Rs. 393.745 per share.
The Company has acquired 50% stake in L&T-Demag Plastics
Machinery Limited from the JV partner M/s Sumitomo (SHI) Demag
Plastics Machinery GmbH on March 31, 2009. Accordingly 30,00,000
shares were acquired for a consideration of Euro 1. Thus L&T-Demag
Plastics Machinery Limited became a wholly owned subsidiary of
the Company w.e.f. March 31, 2009. An application has been made
to the Registrar of Companies to change the name of the subsidiary
to L&T Plastics Machinery Limited. The Company further subscribed
to 1,00,00,000 shares of Rs. 10 each at par.
The Company transferred its entire 100% stake as detailed below to
L&T Capital Holdings Limited (LTCHL).
50,00,00,000 equity shares of Rs. 10 each in L&T
Infrastructure Finance Company Limited at par.
18,66,91,500 equity shares of Rs. 10 each in L&T Finance
Limited for a consideration of Rs. 490.98 crores.
5,60,60,000 equity shares of Rs. 10 each in India
Infrastructure Developers Limited at par.
LTCHL will be the umbrella holding company for investments in
financial services business.
The Company has also sold 205 equity shares of Rs. 10 each of L&T
Capital Holdings Limited at par.
The statement pursuant to Section 212 of the Companies Act, 1956,
containing details of subsidiaries of the Company, forms part of this
Annual Report.
22
In view of the exemption received from Central Government vide
letter no. 47/378/2009-CL-III dated May 8, 2009, the Audited
Statement of Accounts, the Reports of the Board of Directors and
Auditors of the Subsidiary companies are not annexed as required
under Section 212(8) of the Companies Act, 1956. Shareholders who
wish to have a copy of the full report and accounts of the subsidiaries
will be provided the same on receipt of a written request from them.
These documents will be put up on the Company’s Website viz.
www.larsentoubro.com and will also be available for inspection by
any shareholder at the Registered Office of the Company on any
working day during business hours.
AUDITORS’ REPORT
The Auditors’ Report to the Shareholders does not contain any
qualification.
DISCLOSURE OF PARTICULARS
Information as per the Companies (Disclosure of Particulars in the
Report of Board of Directors) Rules, 1988, relating to Conservation
of Energy, Technology Absorption, Foreign Exchange Earnings and
Outgo is provided in Annexure ‘A’ forming part of this Report.
OTHER DISCLOSURES
The Company has disclosed in the notes forming part of accounts
the quantitative details in respect of sales, raw materials and
components consumed and inventories as required vide sub-paras
3(i)(a), 3(ii)(a)(1) and (2) and 3(ii)(b) of Part II of Schedule VI to the
Companies Act, 1956.
The Central Government, vide its order No. 46/44/2009-CL-III dated
March 30, 2009, has granted exemption to the Company for the
financial year ended on March 31, 2009 in respect of disclosure of
the above mentioned quantitative details where the values of the
individual items in each category are less than 10% of the total value
of the category.
The disclosures required to be made under the Securities and
Exchange Board of India (Employee Stock Option Scheme and
Employee Stock Purchase Scheme) Guidelines, 1999, together with
a certificate obtained from the Statutory Auditors, confirming
compliance, is provided in Annexure ‘B’ forming part of this Report.
Pursuant to Clause 49 of the Listing Agreement entered into with the
Stock Exchanges, a Report on Corporate Governance and a certificate
obtained from the Statutory Auditors confirming compliance, is
provided in Annexure ‘C’ forming part of this Report.
PERSONNEL
The Board of Directors wishes to express their appreciation to all the
employees for their outstanding contribution to the operations of the
Company during the year. The information required under Section
217(2A) of the Companies Act, 1956 and the Rules made thereunder,
is provided in Annexure forming part of the Report. In terms of Section
219(1)(b)(iv) of the Act, the Report and Accounts are being sent to
the shareholders excluding the aforesaid Annexure. Any Shareholder
interested in obtaining copy of the same may write to the Company
Secretary. None of the employees listed in the said Annexure is related
to any Director of the Company.
DIRECTORS’ RESPONSIBILITY STATEMENT
The Board of Directors of the Company confirms:
i.
that in the preparation of the annual accounts, the applicable
Accounting Standards have been followed and there has been
no material departure;
that the selected accounting policies were applied consistently
ii.
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
and the Directors made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the
state of affairs of the Company as at March 31, 2009 and of the
profits of the Company for the year ended on that date;
iii.
that proper and sufficient care has been taken for the
maintenance of adequate accounting records in accordance with
the provisions of the Companies Act, 1956 for safeguarding the
assets of the Company and for preventing and detecting fraud
and other irregularities; and
iv.
that the annual accounts have been prepared on a going concern
basis.
DIRECTORS
Mr. Jagjeet Singh Bindra who was appointed as an Additional Director
w.e.f. January 30, 2009, holds office upto the date of the forthcoming
Annual General Meeting and is eligible for re-appointment.
Mr. Thomas Mathew T. who was appointed on November 20, 2006 in
the casual vacancy caused by the resignation of Mr. A. K. Shukla,
holds office upto the date of the forthcoming Annual General Meeting
and is eligible for re-appointment.
Mr. S. N. Talwar, Mr. K. V. Rangaswami, Mr. M. V. Kotwal, Mr. V. K.
Magapu and Mr. R. N. Mukhija retire from the Board by rotation and
are eligible for re-appointment at the forthcoming Annual General
Meeting. The Notice convening the Annual General Meeting includes
the proposals for re-appointment of Directors.
Annexure ‘A’ to the Directors’ Report
(Additional information given in terms of notification issued by the
Ministry of Corporate Affairs)
[A] CONSERVATION OF ENERGY:
(a) Energy Conservation measures taken:
1 Improving energy effectiveness / efficiency of Equipments
and Systems
Use of Variable frequency drive for various applications
such as central ACs, FDVS, AC plant Air Handling Units,
EOT crane motors, etc. to improve the motor efficiency
and enhance energy saving.
Use of solar powered street lights, installing timers, applying
reduced voltage to street lights during night time, installation
of dusk to dawn solar powered street lights, etc. saving
energy.
Use of Solar power for water heaters, installation of water
heating system for canteen cooking / washing, use of
Portable electrical ovens modified with digital temperature
controller, green power generation through roof installed
grid connect solar power plant.
Use of energy saving devices like human body sensors,
presence sensors, time switches, photo sensing devices,
electromizer energy saving devices, TFT monitor, LCD
screens in discussion rooms, zone controlled AC, Low
emission films on glass doors and windows, etc to reduce
energy consumption.
Procurement of energy efficient Amada CNC Press Brake
machine as a replacement of old machine.
Procurement of new compressor for packing shop for usage
in third shift to cater to month end urgent packing
requirements thus reducing the need to switch on a higher
rated common compressor.
CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in attaching the Consolidated Financial
Statements pursuant to Clause 32 of the Listing Agreement entered
into with the Stock Exchanges and prepared in accordance with the
Accounting Standards prescribed by the Institute of Chartered
Accountants of India, in this regard.
The Auditors’ Report to the Shareholders does not contain any
qualification.
AUDITORS
The Auditors, M/s. Sharp & Tannan, hold office until the conclusion of
the ensuing Annual General Meeting and are recommended for
re-appointment. Certificate from the Auditors has been received to
the effect that their re-appointment, if made, would be within the limits
prescribed under Section 224(1B) of the Companies Act, 1956.
ACKNOWLEDGEMENT
Your Directors take this opportunity to thank the Financial Institutions,
Banks, Central and State Government authorities, Regulatory
authorities, Stock Exchanges and the stakeholders for their continued
co-operation and support to the Company. Your Directors also wish
to record their appreciation for the continued co-operation and support
received from the Joint Venture partners/Associates.
Mumbai, May 28, 2009
For and on behalf of the Board
A. M. Naik
Chairman & Managing Director
Saving of diesel by efficient running of powder coating /
pre-treatment plant, provision of AMF panels on generator
sets, etc.
Practising Rain Water harvesting, sewage water treatment
plant to recycle the water for maintenance of the greenery,
use of auto sprinkling system for watering of gardens, use
of foam type taps, Water efficient / climate tolerant plantings,
etc.
Reduction in daily A.C. running time, switching off lights
and air conditioning during lunch breaks.
Re-sizing of conformal coating chamber and reducing the
size of the chamber exhaust fan.
Use of Turbo ventilators for non air-conditioned areas to
extract heat of the building.
Reducing the height of the ceiling, installation of fibre sheet
to get more illumination and improve daylight.
Replacement of florescent tube lights, incandescent lamps
with CFL, & metal halide lamps in various offices and
workshops.
Stopping air leakages, installing new air solenoid valves in
air line to control air combustion, etc.
Modification of Coolant piping (reduction in joints, bends,
friction) in Asquith deep hole drilling machine to save
energy.
Installation of Energy Saver in welding machines belonging
to subcontractors, introduction of Fullwave welding
machines and Inverter based welding machines.
Replacement of Chuck drives with the latest energy efficient
drives, procurement of new high efficiency welding inverters
and welding machines.
Installation of energy efficient AC windows units having
screw compressor, replacement of V belts with flat belts in
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AC unit compressors, installation of real time switches in
package ACs, etc.
Modularization of Chilled Water system to take care of
different load centres, use of Zero CFC based refrigerants;
double glazing; high performance CFC free chillers.
Introduction of VVVF Drives in the place of conventional
type starter panels for all the movements in Gantries,
detachment of Cable realer motors from all gantry cranes
& adopted the cable Festoon system.
Taking various initiatives to reduce the fuel consumption
including:
Modification of Flue gas ducting system to retain more
heat inside the galvanizing furnace chamber.
Adding special additives with fuel in order to get
complete combustion.
Pre-heating of fuel to improve combustion.
Frequent cleaning & monitoring of burner valves,
nozzle & strainers.
Use of Soft Starters:
Soft Starters utilize a powerful micro - controller, which
continuously monitors motor efficiency. Slight changes
in demand will be recognized and Starter will respond
immediately by matching the input power exactly as
the load changes - thus saving energy. The heat
generated while running of motor is minimized. This
in turn improves the efficiency drastically.
Usage of energy efficient motors:
Energy efficient motors increase the power factor
higher than those of standard motors. Energy efficient
motors operate without loss in efficiency at loads
between 75% and 100% of the rated capacity.
Formation of a dedicated team to focus on ‘Climate Change
Mitigation, Carbon Trading and Environmental
Management’.
2 Improving energy effectiveness / efficiency of
Manufacturing Processes
Electrode implementation in vacuum sealed packing to
eliminate breaking.
Development of Portable boring cum milling machine for
machining of nozzle cut out.
Design & Development of 500 MT Tank Rotator with Anti
drift Mechanism.
Design and development of Portable Flame cutting
machine for Nozzle Cutout.
Implementation of Data Logger for Welding Equipment for
capturing the actual welding parameters.
Installation of Automatic Temperature Monitoring &
Controlling System during welding. This development has
been granted Patent - 1st Indian patent for L&T, HZMC.
Design & Development of SAW Station (Plug & Play) with
the following features:
Heat insulated platform bottom and seat for operator’s
comfort.
Flexible arrangement for welding head mounting
Modular design
Indigenous development of hydro expansion tooling for
expansion of large dia tubes.
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Development of Button forming process on Hex sheath of
DFSA, DBSA, SSSLSA.
Clad Restoration of inaccessible areas of Elbow # Pipe
joint by using camera along with FCAW process.
Development of FCAW O/L process Station for 3.7m long
pipe which was previously done in sections.
Development of Clad stripping machine in LEMF replacing
manual working.
Development & installation of portable pipe bevelling
machine to replace manual grinding resulted in reducing
the cycle time from 120 minutes to 2 minutes.
Development & commissioning of Spiral weld overlay
reducing the cycle time by 95%.
Implementation of Square Butt joint in Special project,
converting manual weld to automatic weld, reducing cycle
time for WEP preparation & welding and reduces rework &
repair.
Installation of Virtual Reality Simulator for training Welding
Operators.
Development of wider Stainless Steel ESSC strip to reduce
cycle time.
Implementation of 350 kg wire Pay-off pack for High
thickness Circ Seam Welding in Station reducing change
overtime by 90%.
Use of Automatic CNC based machine for In-Situ
squareness & WEP machining for Sections in axis
horizontal condition.
Implementation of GMAW-P welding in LEMF defence
shops.
Joining of Cupro Nickel Sleeve to AB grade forging by
automatic GTAW Process.
Introduction of laser based instruments like cross liners
and EDM, which are more efficient than the conventional
measurements with plumbs and tapes.
Use of In-Situ Hydro of penetrations without welding blanks
on penetration face, usage of man lift to minimize
scaffolding requirement hence reduction in cost & cycle
time.
CNC Retrofitting of Bench lathe in Kansbahal enhancing
productivity resulting in reduction of process time & power
consumption.
Replacement of 5T melting ARC furnace by 4T energy
efficient medium frequency Induction furnace at Foundry
in Kansbahal.
Installation of Variable frequency drives for EOT crane
hoists at LTMBU to improve the motor efficiency and
enhance energy saving.
(b) Additional investments and proposals, if any, being
implemented for reduction of consumption of energy:
Use of energy saving type of lighting arrangements (LED
based, metal halide etc.) in Shop floor and on roads inside
factory, install lighting energy saver, replacement of HPSV
(high pressure sodium vapour) lamps with metal halide.
Procurement of additional Inverter based welding machines
instead of rectifiers for shops, new machines with energy
efficient motors, etc.
Exploring use of Solar AC & wind power solutions.
Usage of Energy Saver Ballast in more nos. of Flood Lights
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Optimizing excess air in plate heating furnace, Vapour
absorption Machine (VAMs), etc.
Installation of VFD (variable frequency drive) in secondary
chilled water & condenser water pumps in office buildings.
Study of Waste Heat Recovery of Natural Gas Power
Generator for enhancing energy efficiency.
Installation of Natural Gas based additional Generating set
–III
CNC Retrofitting of VDF Table borer for enhancing
productivity and reducing machining time resulting in
reduction of process time & power consumption.
Replacement of conventional central A/C plant with new
energy efficient plant.
(c)
Impact of measures at (a) and (b) above for reduction of
energy consumption and consequent impact on the cost
of production of goods:
The measures taken have resulted in savings in cost of
production, power consumption & processing time.
(d) Total Energy Consumption and Energy Consumption per
unit of production as per Form A in respect of industries
specified in the Schedule:
NOT APPLICABLE
[B] TECHNOLOGY ABSORPTION:
Efforts made in technology absorption as per Form B.
FORM B
(Disclosure of particulars with respect to Technology Absorption)
RESEARCH AND DEVELOPMENT (R&D)
1.
Specific areas in which R&D carried out by the Company:
Cement & Mineral Process
Process Design and related aspects of Cement / Mineral
projects; Modelling of NOx emission; Use of alternative
fuels; Comminution characteristics of blended cement;
Modelling and simulation of entrained flow and fixed bed
coal gasifiers.
Chemical Engineering
Design, analysis and simulation of chemical processes and
equipment, with special emphasis on Oil & Gas applications
(3-phase separators, fuel gas conditioning skids); Capability
development for in-house process engineering of Process
Gas Compressor modules; Fertilizer plant revamp,
Ammonia and Methanol plants. Refractory engineering for
chemical plant equipment.
Material Science & Corrosion Engineering
Construction Material for Oil & Gas, Refineries and
Chemical plants process equipment; Root cause analysis
of metallurgical and corrosion related failures; Surface
treatment processes for defence and aerospace
components; Composite materials for functional properties
requirement. Nano Technology for strategic applications.
Thermal Engineering
Dynamic simulation of captive power plant; CFD analysis
of industrial machinery and systems (such as air
preheaters, kiln burners and wind tunnels); Design and
analysis of thermal systems in refineries and process
plants; Capability development in Super Critical Boiler
technology.
Rotating Machinery
Advanced engineering studies for Oil & Gas and Power
projects; Performance testing and commissioning of
process gas compressors; Development and optimization
of coal pulverizer system. Analysis of flow-induced and
acoustic vibration in Oil & Gas pipelines; Advanced
analytical techniques for machinery design.
Mechanical Engineering
Development of advanced design / analysis capabilities
for equipment and structure in Heavy Lift & Pipe Lay Vessel;
Seismic analysis of on-shore buried pipeline; Design
solutions for various products through advanced Finite
Element analysis; Piping analysis and engineering support
in offshore Oil & Gas applications; Experimental stress
analysis of critical products; Capability development in
material non-linear analysis and fatigue analysis using FE
techniques.
Ocean Engineering
Design, analysis and optimization of complex offshore
structures; Transportation analysis for offshore jacket and
compressor modules; Hydrostatic stability analysis of jack-
up rigs and semi-submersibles; Studies on design/analysis
of FPSO Topsides, Sub-sea Systems and Jack-up Rigs;
Capability development for in-house engineering of PGC
modules (structural design).
Water Technologies
Design and specifications for brackish water RO plant;
Design and specifications for membrane bio-reactor for
treated sewage recycling; Studies on RO-based
desalination technology, Membrane Bio-reactors, Thermal
Desalination systems and Zero-discharge technologies;
Development of laboratory facilities for water / waste water
analysis.
Development of new products / product ranges of Air Circuit
Breakers, Moulded Case Circuit Breakers, Miniature Circuit
Breakers, Contactors, Relays Switch Disconnector Fuses,
Change-Over devices, & Motor starters.
IGBT based Slip Power recovery systems (benefits –
energy saving without affecting Power Quality).
1 MW high quality power supply for sea port application
(import substitution - saving Foreign Exchange).
DCS for Power system
Highway Traffic Management System
Medium Voltage Inverters, designed & developed five types
of electronic energy meters for various applications.
Development of communication modules for remote meter
data acquisition on GPRS, Low Power Radio, development
of software for remote acquisition of meter data.
Release of 5 new products in the monitoring range namely
Comet-P, Galaxy 55, Star 55 with 12 L ECG, Skyline 55 a
16 bed Central Nurses Station, 3 channel ECG M/c ‘Orion’
and in Ultrasound ‘Scintilla’ colour Doppler.
FDA approval for 11 products till date. More focus was
placed on developing and aligning our products to drive
our thrust towards exports largely USA.
Development of indigenous NIBP module to achieve
technology independence & cost effectiveness for our
monitoring products.
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Filing of 14 patents by Medical Division in 2008-2009 and
focusing on self reliance in core technologies in monitoring.
The products have been developed with a focus on
Enhanced safety and user convenience
Environment friendly features
Built-in intelligence & Communication capability
Conformance to latest Indian & International
standards
Weapon Launch Systems (Structures, mechanisms, drives,
controls), Air Defence Guns (Ballistics, mechanisms, drives,
optronics), Robotics & remotely operated systems,
Development of steam generator design for Nuclear power
plant, Manufacturing Technology for thin walled Aero
structures, Development of Plasma Arc Welding
Technology for Space & Strategic applications,
Development of Airborne Composite Components.
Composites (Process & Design Technologies),
Regenerative heat exchanger for strategic project.
Development of welding Simulation Technology.
Development of Feed-water Heater Design Package for
supercritical power plants.
Development of Core technologies for Hypersonic Wind
Tunnel Systems.
Development of Angular Motion Simulator
Design provisions & development of Optical measurement
technologies for achieving machine tool alignment
accuracies within 1 arc second.
Development of Road Miller, a new product for KBL, which
is suitable for undertaking proper repair of city roads and
highways with the possibility of recycling the old pavement
material. The first prototype will be tested during the FY
2009-10.
Design of Track-mounted and electrically-driven Primary
Mobile Crushing Plant for crushing aggregate and iron ore.
The first prototype will be tested during the FY 2009-10.
Design of certain Construction equipment and Body for
Tipper Trucks along with the development of prototypes is
on the anvil. Besides this, developmental work is also being
carried on an all-electric Plastic Injection Moulding Machine.
R&D efforts in respect of development of 30% energy
saving platen insulation system for tyre curing press, mould
container, equipment for handling rubber ply and designs
for internal mixer of 240L and 270L capacities and Web
handling equipment for calendar and extruder lines.
Development of No Cement Concrete, Development of light
weight concrete panels for modular housing, Continued
development in self compacting & high strength concrete
above M80, Development of eco friendly, green products
and conservation of natural sources – Reduction of soil
brick in housing construction by Controlled Low strength
Materials in the form of blocks and concrete.
Development of alternate foundation system for
Transmission line towers.
Continued Development of soil stabilization techniques for
airport sub grades & high speed corridors, Development
of low cost kit for compaction control under vibratory roller,
Continued development of performance grade Asphalt with
polymer, Continued development of recycled asphalt
pavement (RAP) for high speed corridors.
Development of neural network algorithms for optimization
of buildings design & construction.
Development of RFID’s application in logistics handling and
stores management.
2. Benefits derived as a result of above R&D:
Process design and optimisation for cement plants
Refractory solutions for high-temperature equipment in
process plants
Process simulation and optimization for E&C projects
involving refinery, fertiliser and chemical plants, Successful
testing / commissioning of plants and equipment in various
E&C projects, through multi-disciplinary technology
support, Successful simulation of combined cycle power
plant dynamics; optimization of equipment and system
design using CFD technique; design / optimization of
various thermal systems, Development of optimized design
for coal pulverizer / separator system for power plant
application, Development of in-house capability for
analyzing flow-induced vibration and acoustic vibration in
oil & gas piping systems, Successful diagnosis of rotating
machinery problems in various projects through vibration /
acoustic analyses, Development of in-house capability for
seismic analysis of buried pipeline, Design / analysis of
complex structures and piping systems for offshore Oil &
Gas applications, Development of design / analysis
techniques and resources for Deepwater Oil & Gas
applications.
Material evaluation / characterization; selection of
alternative materials; failure analysis support; preservation
and corrosion protection of critical equipment.
Design solutions for water treatment systems,
Establishment of in-house water testing facilities.
Development of capability for in-house engineering of
Process Gas Compressor modules.
Development of in-house expertise in high-end engineering
analysis (e.g., advanced FEA, CFD, Dynamic Simulation,
Acoustic Mapping, Rotor Dynamics, Non-Linear Analysis
etc.) and technologies such as nano materials, advanced
corrosion control methods and water treatment techniques.
Expansion of product range and export opportunity, Product
improvements, Cost effective products, Acceptance for
International Markets, Technology up gradation, Developing
safe, user and environmental friendly products.
Providing a comprehensive solution for Automatic Meter
Reading (AMR).
Installation of High speed press ‘Bruderer’ and Precision
grinding machine ‘Imatec’ for manufacture of magnets for
contactors.
Fully automated testing & packing set up for MCB
manufacturing.
Introduction of a system of E-waste disposal through MPCB
approved source to ensure the environmental friendly
disposal.
Installation of automatic silver plating plant (and with strict
process control, has resulted a reduced water consumption
& chemical consumption in silver plating).
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Road Miller and track-mounted electrically-driven mobile
crushing plant has increased our product range. Road Miller
has good export potential.
Creation and implementation of procedure for top-down
design of Mobile Equipment using 3D Modelling using PLM
/ Windchill, design validation & analysis of complete Mobile
Equipment using ANSYS and Hypermesh and process for
deriving target specifications for a mobile construction /
mining equipment. This initiative offers tremendous
business opportunity as and when it is decided to launch
new products.
Offering a new product line in Rubber Processing
Machinery to cater to high volume growth market and
enable entry into new application area of rubber mixing
technology, besides development of in-house knowledge
of rubber web handling.
Conservation of Natural resources on development of
Controlled Low Strength Material and alternate Pavement
blocks, Reduction in natural aggregate consumption in
Pavement Construction by Mechanistic approach design
and alternate pavement construction, Performance grade
binder for critical conditions of traffic loading, Cost effective
utilization of natural materials with substitution of Recycled
Asphalt Pavement materials.
Building up a strong intellectual property base, Winning
national / international awards in recognition of good
designs of products, Enhancing intelligence and
communication capability, Ease of manufacturing &
improvement in productivity, Indigenisation & development
of products for Indian defence sector, Savings in Foreign
Exchange.
3.
Future Plan of Action:
Process technology for coal gasification
Alternative fuels for use in cement plants
Low-NOx Burners for combustion of alternative fuels
Simulation of Combustion Chamber
Design / simulation of Hydrogen and Ammonia processes
and Auto Thermal Reformers.
Study on Gas Processing techniques
Study of Synfuels Technology
Applications of Nano Technology, development of nano-
materials and coatings
Application of electrochemical noise method for
characterization of stress corrosion cracking (SCC)
Carbon-fibre from polymeric fibres
Dynamic Simulation and Performance Analysis of
Combined Cycle Power Plants
Technology Analysis of Super Critical Boilers
Thermo-hydraulic design of Once-Through Steam
Generator (OTSG)
Capability development in machinery design and fault
diagnosis involving advanced analytical techniques
Study of water hammer / surge phenomena in large liquid-
handling pipe networks
Application of Statistical Energy Analysis (SEA) in
machinery noise control
Development of in-house expertise in performing advanced
engineering studies for large EPC Projects
FE analysis of Floating Structures
Design / analysis of FPSO Topsides
Design / Analysis of Jack-up Rigs and Semi-submersible
Drilling Rigs
Design and analysis of Jacket & Deck Installation
Design and Analysis of Sub-sea pipeline installation
Capability development for Pile Drivability analysis
Capability development for motion response analysis of
offshore vessels
Design of Membrane Bio Reactors
Thermal Desalination techniques
Recycle, Reuse and Zero-discharge Technologies
Nano coatings to improvise surface properties
Nano-catalysts
Development of new / upgraded products in defence
equipments
Toll Management system including Electronic Toll Collection
for National & State Highways
Integrated Terminal Automation & Tank Farm Management
System for Petroleum Products
Power Management System
Launching new range of cost effective Multi-parameter
monitors with rich features viz. Planet 50N, Star 50N and
Planet 30 during Q2 of 2009-2010. A new trolley model
premium Grey scale Ultrasound System and colour Doppler
is under development and is expected to be launched
during Q3 of 2009-2010.
Continuing efforts on bringing out new intelligent meter
designs.
Developing communication modules
communication over wired as well as wireless media.
for meter
Developing software for data acquistion and Advanced
Metering Infrastructure (AMI)
Developing another new model of Surface Miner with higher
capacity of coal mining, thus extending the existing range
of Surface Miners.
Creating & implementing Test protocol and field testing for
Mobile construction / mining Equipment to simulate
functional requirement / field conditions.
Developing new products and upgrade existing products
in rubber mixing, besides capability development in
automated material handling pertaining to tyre industry.
Development of thermal efficient building products
Development of high early strength concrete for faster
construction
Development of deep soil mixing technique
Development of Laboratory information management
system for Construction
Development of Pavement Management System
Development of faster construction methods and systems
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4.
Expenditure on R&D:
(a) Capital
(b) Recurring
(c) Total
(d) Total R&D expenditure as a
percentage of total turnover
2008-2009
Rs. crore
2007-2008
5.01
75.18
80.19
6.61
60.64
67.25
0.24%
0.27%
TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION:
Efforts in brief made towards technology absorption,
1.
adaptation and innovation:
Interaction with external agencies / technology partners
for exposure to the latest products / designs, manufacturing
technologies, processes, analytical techniques and
engineering protocols.
Participating in national / international conferences,
seminars and exhibitions.
Valuation, adaptation and/or modification of imported
designs / technologies to suit indigenous requirements,
alternative materials / components.
Parametric studies involving theoretical models duly
validated by experimental studies at in-house laboratories
and pilot plants as well as feedback and operating data
during commissioning of various plants and machinery.
Review of patents in relevant technology areas.
Collaborative efforts with educational / research institutions
for technology upgradation.
Use of state-of-the-art equipment, instrument and software.
Analyzing feedback from users to improve processes and
services.
Adaptation of previously developed technologies for
delivering products such as Winch & Mooring System for
Aerostats, Torpedo Launcher mounts, ASW Rocket
launcher mounts & Anti-Tank Guided Missile launchers.
Indigenisation of all the boiler components of Shell Coal
Gasifiers.
Development of hydraulic gap setting mechanism for Jaw
Crusher, STJ108.
Development of design of Vibrating Feeder, Grizzly Feeder
and Conveyor for Mobile Crushing Plant.
Introduction of new products with indigenous technology;
also developing products which are user-friendly, eco-
friendly and with enhanced safety features.
Technology absorption in rubber mixing through hiring the
services of a Consultant.
Development of Blanking Tool For Climbing Bracket Head
Plate – which avoids Gas cutting and grinding.
Development of Compound Tool For Climbing Bracket Main
Plate – which combines 3 different operations in a single
tool.
2. Benefits derived as a result of the above efforts, e.g., product
improvement, cost reduction, product development, import
substitution, etc.:
Successful simulation / optimization of process design and
engineering for various E&C projects (cement, refinery, Oil
& Gas, fertilizer and chemical plants).
28
Appropriate refractory design for high-temperature
applications.
Successful selection and characterization of materials for
critical applications and implementation of suitable
preservation / corrosion protection techniques.
Establishment of in-house capability for dynamic simulation
of complex thermal-fluid systems in Combined Cycle Power
Plant.
Development of upgraded cement kiln and ball mill designs,
suitable for enhanced production capacity and higher
operating speeds.
Development of in-house expertise for seismic analysis of
buried pipelines.
Effective solutions to design / analysis problems involving
complex structures and piping systems for offshore Oil &
Gas applications.
Development of in-house analysis capabilities and
resources for Deepwater Oil & Gas applications.
Capability development for design for water treatment
systems for various applications.
Successful testing / commissioning of plants and equipment
in various E&C projects, through multi-disciplinary
technology support.
Acquisition of in-house expertise in high-end engineering
analysis (e.g., advanced FEA, CFD, Dynamic Simulation,
Acoustic Mapping, Rotor Dynamics, Non-Linear Analysis
etc.) and technologies such as composite materials,
advanced corrosion control methods and water treatment
techniques.
Establishment / upgradation of state-of-the art laboratory
facilities for material characterization, chemical analysis,
corrosion control, vibration and acoustics and experimental
stress analysis, in order to provide comprehensive
technology support to business units. This has reduced
the dependence on external agencies and enabled effective
execution of projects.
Indigenisation (import substitution) & development of
products for Indian defence sector
Expansion of product range and export opportunities.
Product improvement.
Increasing knowhow within the country.
Improving the effectiveness of the operation of the crusher
by increading the Hydraulic gap setting.
Development of Vibrating Feeder, Grizzly Feeder and
Conveyor have resulted in product improvement and also
cost reduction.
3.
Information regarding technology imported during the last
5 years
S. Technology Imported
No.
Year of
Import
Status
a) Sour Water Stripping Process
2005
Absorbed
b)
Tail Glass Treatment Process
2005
Absorbed
c) Manufacturing know-how of
Cementing Unit
2007
Absorbed
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(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
[C] FOREIGN EXCHANGE EARNINGS AND OUTGO:
Activities relating to exports, initiatives taken to increase
exports; development of new export markets for products
and services; and export plans.
Overview:
The Company has a diversified range of products. Each business
division of the Company has dedicated cells for giving impetus
to exports. The Company has offices abroad and agents in
various countries to boost exports. The Company is intensifying
efforts in selected countries and exploring new markets. The
Company is expanding reach of new products through synergy
with existing products and, International Engineering,
Procurement and Construction (EPC) projects. Export of heavy
engineering equipment has been identified as thrust area. The
Company regularly participates in prestigious international
exhibitions and conducts market surveys and direct mail
campaigns. The Company has an international presence, with
a global spread of offices and joint ventures with world leaders.
Its large technology base and pool of experienced personnel
enable it to offer integrated services in world markets.
Engineering & Construction Division:
E&C Division continues to focus on GCC countries for procuring
EPC contracts. The division has set up overseas design and
engineering centres in UAE to cater to engineering support on
new projects, obtaining stand-alone engineering/consultancy
business and co-ordination/support on EPC projects awarded
in the region. The division is also focusing on electro-mechanical
construction works in all GCC countries and towards achieving
the same, JV companies have been formed in Kuwait, Oman,
Saudi Arabia & Qatar. The division is widening its network of
overseas marketing partners in the GCC as well as other
countries in the Middle East & Far East. The division is looking
forward to other opportunities in the MENA region (Middle East
and North Africa) and CIS countries.
The Company’s E&C Division has executed and is executing
Engineering, Procurement (EP) and Engineering, Procurement
and Construction (EPC) projects in countries like Oman, Qatar,
Saudi Arabia, Kuwait, UAE, Malaysia, Tanzania, Sri Lanka, etc.,
and in the field of upstream hydrocarbon, mid & downstream
hydrocarbon, hydrocarbon plant construction & pipelines and
power. E&C Division has actively contributed towards clean
environment through execution of Clean Fuel projects such as
Motor Spirit Quality Upgradation, Diesel Hydro treating,
Hydrogen and Sulphur Block projects.
The global market for construction industry was at boom during
the first half of 2008-09. The Gulf market due to phenomenal oil
price hike created lots of opportunity for the Company during
the first half. The inflationary trend had its own impact by way of
unprecedented increase in commodity prices which has
squeezed the margin since majority of the Company’s contracts
were fixed price contracts.
The business environment was very sluggish during the second
half of 2008-09 for the Building & Urban Infrastructure business
due to the macro-economic decline on a scale not seen for
decades.
The economic meltdown had a great impact on the property
market in Dubai, which has forced the developers to defer lot of
their ambitious plans resulting in a very depressed market. The
Buildings & Urban Infrastructure business could not secure any
order due to the adverse market trend. The Company had also
adopted a cautious approach in selecting the bids to avoid
liquidity risk seen during recession. However the Power
Transmission & Distribution business and Ready Mix Concrete
business strengthened its presence in select Gulf Market.
The Gulf economy is mainly dependant on the movement of oil
price. With the oil price oscillating up and down it is expected
that the year ahead is going to be much more challenging than
the previous year. The business prospects for the Gulf Projects
in the Infrastructure, Power Transmission & Distribution business
are expected to be promising. The thrust on geographical
expansion through focus countries (Kuwait, Saudi, South Africa,
Botswana & Libya) is expected to yield good result in the years
to come. There are plans to strengthen our position in the ready-
mix-concrete business. Expanding the business horizon and
geography are some of the futuristic initiatives taken by the
construction division.
Heavy Engineering Division (HED):
HED continues to take a number of initiatives to enhance export
growth. In the last financial year, exports accounted for 50% of
total sales in the Division.
South America in general & Brazil in particular is emerging as a
major market for process plant equipment. HED has booked
orders worth Euro 113 million for the supply of Reactors & Coke
Drums for North East Refinery project of Petroleo Brasileiro
S.A. – Petrobras, Brazil.
Middle East & North Africa (MENA) continues to be focus market
for HED. Orders for supply of critical equipment to fertilizer
projects were received from Oman, Algeria.
Orders for supply of Ammonia converters for various projects in
Iran were received. With these orders, Iran has been included
in HED’s list of important markets for equipment supply.
Coal gasification equipment is one of HED’s key products for
export. Orders for this equipment have been received from Shuifu
Coal Revamp Project, China and Ninh Binh Fine Coal Based
Urea Project, Vietnam.
China remains to be a major market for HED’s products. Apart
from coal gasification equipment, HED has also received order
for Methanol Converter for Sichuan Vinylon Works, Chongqing.
HED has been exploring opportunities for export of Defence,
Nuclear Power & Aerospace equipment as well. With
authorization from ASME (American Society of Mechanical
Engineers) for the use of ‘N’ & ‘NPT’ stamps, the Company is
well placed to supply critical nuclear power equipment to the
overseas market.
HED’s initiative for boosting of exports includes the following:
Offering valued added services like site work for Chinese
projects
Participation in international seminars
Building on the success of Power Plant equipment with
overseas customers
Offering value added services like maintenance-friendly
design features for High Pressure Heat Exchangers at
customer’s plants.
Establishment of Representative Offices in major overseas
markets.
Electrical & Electronics Business Division:
International Sales of Electrical Standard Products (ESP) has
continued to pursue the two pronged strategy of promoting sales
to select overseas markets and to brand labelling partners.
29
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(cid:129)
(cid:129)
(cid:129)
With the introduction of type tested fixed type Switchboard in
the UAE, ESP has made substantial inroads in the UAE market,
securing prestigious building projects. New products such as
Busbar trunking and Wires were introduced in selected markets.
ESP has entered into new brand labelling arrangements for
MCCBs and supplies to commence during 2009-2010. ESP has
completed CCC (China Compulsory Certification) for MCCBs &
Controlgear products as planned. Export sales during 2008-09
were 97.6 Cr (36% growth). Export as % of ESP sale has
increased from 5.4% (in 07-08) to 7.3% (in 08-09).
The Electrical Systems and Equipment, offering electrical
systems up to Medium Voltage (MV) range, grew significantly
in the GCC countries and North Africa. The Division’s JV in Saudi
Arabia has executed many significant projects in the Gulf
countries. MV product sales has also increased substantially
over last year and enabled better positioning as complete
electrical solution provider up to 36kV range.
Control & Automation business has exports of engineered control
and automation solutions to Middle East, African countries etc.
It has export of engineering & software services. Also Deemed
export of the supplies & services for the control & automation
systems.
Metering business booked an order for trivector meters worth
US $ 0.5 million from Bangladesh. It will be executed in 2009-10.
It has participated in tenders worth US $ 0.4 million which are
under evaluation. Also development of meter as per
specifications of utilities in certain select markets is in progress.
Manufacturing & Industrial Products Division:
Kansbahal (KBL) Unit has developed contact with potential
customers, local service providers in the Middle-East and
countries like Australia, Indonesia, where opportunity for
exporting Surface Miners is good.
Valves Business Unit already has a sizeable export business.
Plans are afoot to scale up the exports through leveraging
alliances and agreements with major end-users, and diversifying
into additional markets such as South America, Iran etc., also
increased focus into Power Sector.
Rubber Machinery Business Unit (LTMBU) has been
continuously working on development of export markets, as most
global tyre companies are its major customers and revenues
from exports have always been forming a significant portion of
LTMBU sales.
A few initiatives detailed:
The following initiatives have been taken by the Company
Expanding Modular Fabrication Facility at Hazira and
making operational its Modular Fabrication Yard at Sohar,
Oman to cater to deepwater opportunities.
Joint venture with SapuraCrest Petroleum Berhad of
Malaysia to form Offshore International FZC, for
construction of own Heavy Lift & Pipelay Vessels (HLPV)
to provide offshore installation services to the Oil & Gas
industry. A 290-man HLPV (LTS 3000), is under
construction for the JV at a shipyard in Batam, Indonesia
and is scheduled to enter service in Q1 2010.
Establishing two joint ventures with Mitsubishi Heavy
Industries of Japan for environment-friendly coal-fired
supercritical boilers and supercritical steam turbine
generators.
Joint Ventures with local companies for undertaking electro-
mechanical construction activities for Hydrocarbon
Construction & Pipelines, for the Middle East and South
East Asian markets.
Efforts for strategic alliances with Process Licensors /
technology Providers and reputed international EPC
players are underway to undertake high value projects in
international markets.
Widening new geographical areas for augmenting its
exports.
Exploring inorganic growth opportunities for the acquisition
of specialized engineering outfits abroad.
Membership of global forums like Engineering &
Construction Risk Institute (ECRI) and participating in
international seminars.
Implementation of Project KIRAN to towards operational
excellence and creating a lean high performance
organization.
Implementation of Knowledge Management System
“KnowNet” for capturing tacit knowledge in the form of
learnings & experiences and disseminating the same
across the organization.
Bringing in high caliber resources in the areas of front-end
marketing, engineering, project management, risk
management, contract administration, etc., to strengthen
the overseas operations.
Customized Talent Management programmes including
flagship Capability & Leadership Development (CALD)
programmes for catering to the training and development
needs of employees.
Setting up a premier world-class centre for excellence in
project management - Project Management Institute (PMI)
at L&T Knowledge City – Vadodara.
Total foreign exchange used and earned:
Foreign Exchange earned
Foreign Exchange saved /
deemed exports
Total
Rs. crore
2008-2009
2007-2008
7,348.23
5,656.59
92.31
124.04
7,440.54
5,780.63
Foreign Exchange used
7,899.42
4,534.37
30
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
Annexure ‘B’ to the Directors’ Report
(I)
A.
Employee Stock Ownership Scheme-1999-2003
PRE RESTRUCTURE:
ESOP SERIES
Particulars
SAR-1999
(1)
(2)
2000
(3)
2002-A
(4)
2002-B
(5)
2003-A
2003-B
(6)
(7)
(a) Options granted
(b)
The pricing formula
10,66,000
Stock Appreciation
Rights (SARs)
Grant price for the
purpose of
ascertaining the
appreciation:
Average of daily
High Low Averages
of the Company’s
Share price on the
Stock Exchange,
Mumbai,
during the year
April 1998 –
March 1999.
This worked out to
Rs. 199/- per share.
39,48,800
Equity shares
37,81,100
Equity shares
37,81,660
Equity shares
67,51,000
Equity shares
57,42,500
Equity shares
The average
market price on
the Stock
Exchange,
Mumbai,
on the date
of grant i.e.,
June 1,
2000 – Rs. 184/-
per share.
The average
market price on
the Stock
Exchange,
Mumbai,
on the date
of grant i.e.,
April 19,
2002 – Rs. 172/-
per share.
The average of
the two weeks
high and low
prices of the
shares on the
The average
market price on
the Stock
Exchange,
Mumbai,
The average of
the two weeks
high and low
prices of the
shares on the
on the date Stock Exchange, Stock Exchange,
Mumbai,
of grant i.e.,
Mumbai,
preceding the
preceding the
April 19,
date of grant
date of grant
2002 – Rs. 172/-
i.e., May 23,
i.e., May 23,
per share.
2003 – Rs. 206/-
2003 – Rs. 206/-
per share.
per share.
(c)
Options vested
10,60,750
38,64,050
20,67,250
20,19,830
(d) Options exercised
2,66,500
52,415
12,750
6,250
(e)
Total number of
shares arising as a
result of exercise of
Options (Equity
shares of Rs. 10/-
each)
1,04,318
52,415
12,750
6,250
(f)
Options lapsed
5250
1,46,025
1,25,300
1,07,375
(g)
Variation of terms
of Options
(h) Money realised by
exercise of Options
(i)
Total Number of
Options in force
Nil
Nil
Nil
Nil
Rs. 10,43,180
Rs. 96,44,360
Rs. 21,93,000
Rs. 10,75,000
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
7,94,250
SARs
37,50,360
36,43,050
36,68,035
67,51,000
57,42,500
31
A.
PRE RESTRUCTURE: (Contd.)
ESOP SERIES
Particulars
SAR-1999
(1)
(2)
2000
(3)
2002-A
(4)
2002-B
(5)
2003-A
2003-B
(6)
(7)
(j)
Employee-wise details
of Options granted to –
i) Senior Managerial
Personnel:
Mr. A.M. Naik
Mr. J.P. Nayak
Mr. Y.M. Deosthalee
Mr. K. Venkataramanan
Mr. R.N. Mukhija
Mr. V. K. Magapu
Mr. K.V. Rangaswami
Mr. M.V. Kotwal
Mr. A. Ramakrishna
Mr. P.M. Mehta
Mr. M. Karnani
ii) Any other employee who
receives a grant, in any
one year, of Options
amounting to 5% or more
of Options granted during
that year.
iii) Identified employees who
were granted Options,
during any one year,
equal to or exceeding
1% of the issued capital
(excluding outstanding
warrants and
conversions) of the
Company at the time of
grant.
1,25,000
2,00,000
2,00,000
2,00,000
2,00,000
2,00,000
60,000
60,000
60,000
30,000
20,000
16,000
16,500
80,000
30,000
40,000
1,00,000
1,00,000
1,20,000
1,20,000
1,20,000
1,00,000
1,00,000
1,20,000
1,20,000
1,20,000
1,00,000
1,00,000
1,20,000
1,20,000
1,20,000
60,000
35,000
25,000
27,000
85,000
35,000
25,000
27,000
1,25,000
1,25,000
60,000
42,000
85,000
-
80,000
40,000
27,000
30,000
90,000
40,000
-
85,000
22,500
17,500
17,500
60,000
-
-
85,000
22,500
17,500
17,500
-
-
-
5,37,500
8,74,000
8,82,000
8,67,000
7,62,500
7,02,500
None
None
None
None
None
None
None
None
None
None
None
None
Consequent to the demerger (sanctioned by the High Court of Judicature at Bombay on April 22, 2004) of Cement Business of the Company and restructuring
of the share capital the outstanding SARs were converted into equivalent number of Options and the total number of Options in force as above were
readjusted in proportion to the restructured equity capital i.e., one Option for an equity share of the face value of Rs. 2/- for every two Options and repriced
at Rs. 14/- per Option in respect of ESOP Series 1999, 2000, 2002-A & 2002-B and Rs. 70/- per Option in respect of ESOP Series 2003-A & 2003-B.
32
B.
POST RESTRUCTURE (PRE BONUS ISSUE -2006)
ESOP SERIES
Particulars
(1)
1999
(2)
2000
(3)
2002-A
(4)
2002-B
2003-A
2003-B
(5)
(6)
(7)
(a)
(1) Options granted (outstanding
3,97,125
18,75,180
18,21,525
18,34,018
33,75,500
28,71,250
and adjusted consequent to
restructuring of share capital)
(2) Options granted during:
(a) 2005-2006
(b) 1.4.2006 to 29.9.2006
(Equity shares of Rs. 2/- each)
(b)
The pricing formula
(Adjusted grant price per share )
(c)
Options vested
6,02,670
56,460
35,30,380
Rs. 14/-
Rs. 70/-
(adjusted on restructure)
3,97,125
18,75,180
Add: vested post restructure
-
-
10,22,050
7,90,312
10,02,003
8,20,708
Nil
Nil
20,51,220
19,32,585
Total
3,97,125
18,75,180
18,12,362
18,22,711
20,51,220
19,32,585
(d) Options exercised
3,97,121
18,65,367
18,03,824
18,04,510
20,33,343
19,14,964
(e)
Total number of shares arising as
a result of exercise of Options
(Equity shares of Rs. 2/- each)
3,97,121
18,65,367
18,03,824
18,04,510
20,33,343
19,14,964
(f)
Options lapsed and/or withdrawn
(g)
Variation of terms of Options
(h) Money realised by exercise of
4
Nil
5,613
Nil
12,326
Nil
14,583
6,94,997
3,23,009
Nil
Nil
Nil
Options
Rs. 55,59,694
Rs. 2,61,15,138
Rs. 2,52,53,536
Rs. 2,52,63,140
Rs. 14,23,34,010
Rs. 13,40,47,480
(i)
Total Number of Options in force -
Vested
Unvested
Total
(j)
Employee-wise details of
Options granted
Nil
Nil
Nil
4,200
Nil
4,200
5,375
Nil
5,375
14,925
Nil
14,925
17,389
6,29,771
6,47,160
17,135
12,75,272
12,92,407
Please refer to Part A (j)
Consequent to the issue of Bonus Shares the total number of Options in force as above as at the record date for Bonus Issue i.e., September 29, 2006 was
readjusted in number in the ratio of Bonus Issue (1:1) and the above exercise price of Rs. 14/- and Rs. 70/- was readjusted to Rs. 7/- and
Rs. 35/- respectively.
33
C.
POST RESTRUCTURE (POST BONUS ISSUE 2006 – PRE BONUS ISSUE 2008):
ESOP SERIES
Particulars
(1)
1999
(2)
2000
(3)
2002-A
(4)
2002-B
2003-A
2003-B
(5)
(6)
(7)
(a)
(1) Options granted (outstanding
and adjusted consequent to
Bonus Issue)
(2) Options granted post
Bonus Issue
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(Equity shares of Rs. 2/- each)
The pricing formula
(Adjusted grant price per share )
Options vested
(adjusted on Bonus Issue)
Add: vested post Bonus Issue
Total
Options exercised
Total number of shares arising as
a result of exercise of Options*
(Equity shares of Rs. 2/- each)
Options lapsed
Variation of terms of Options
Money realised by exercise of
Options
Total Number of Options in force -
Vested
Unvested
Total
(j)
Employee-wise details of
Options granted
Nil
8,400
10,750
29,850
12,94,320
25,84,814
7,18,430
33,03,244
Rs. 7/-
Rs. 35/-
8,400
-
8,400
Nil
Nil
Nil
Nil
Nil
8,400
Nil
8,400
10,750
-
10,750
Nil
Nil
Nil
Nil
Nil
29,850
-
29,850
34,778
12,35,430
34,270
19,90,863
12,70,208
20,25,133
Nil
12,52,754
19,38,270
10,000
12,45,754
18,95,270
Nil
Nil
25,840
2,12,861
Nil
Nil
Rs. 70,000
Rs. 4,36,01,390 Rs. 6,63,34,450
10,750
Nil
10,750
19,850
Nil
19,850
15,726
Nil
15,726
81,963
10,70,150
11,52,113
Please refer to Part A (j)
Nil
-
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
* During the year 2007-2008, 50,000 shares were allocated to employees who exercised 7,000 Options under 2003-A Series and 43,000 Options under 2003-B
Series from the shares returned by two former Directors, pursuant to a Court order.
Consequent to the issue of Bonus Shares 2008 the total number of Options in force as above as at the record date for Bonus Issue i.e. October 3, 2008 was
readjusted in number in the ratio of Bonus Issue (1:1) and the above exercise price of Rs. 7/- and Rs. 35/- was readjusted to Rs. 3.50 and Rs. 17.50
respectively.
34
C.
POST RESTRUCTURE (POST BONUS ISSUE 2008):
ESOP SERIES
Particulars
(1)
1999
(2)
2000
(3)
2002-A
(4)
2002-B
2003-A
2003-B
(5)
(6)
(7)
Nil
16,800
21,500
39,700
31,452
23,04,226
(a)
(1) Options granted (outstanding
and adjusted consequent to
Bonus Issue)
(2) Options granted post
Bonus Issue
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(Equity shares of Rs. 2/- each)
The pricing formula
(Adjusted grant price per share )
Options vested
(adjusted on Bonus Issue)
Add: vested post Bonus Issue
Total
Options exercised
Total number of shares arising as
a result of exercise of Options
(Equity shares of Rs. 2/- each)
Options lapsed
Variation of terms of Options
Money realised by exercise of
Options
Total Number of Options in force -
Vested
Unvested
Total
(j)
Employee-wise details of
Options granted
Rs. 3.50
Rs. 17.50
Nil
-
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
16,800
-
16,800
Nil
Nil
Nil
Nil
Nil
21,500
-
21,500
Nil
Nil
Nil
Nil
Nil
16,800
Nil
16,800
21,500
Nil
21,500
39,700
-
39,700
Nil
Nil
Nil
Nil
Nil
39,700
Nil
39,700
Please refer to Part A (j)
1,53,800
24,58,026
1,63,926
5,19,650
6,83,576
4,47,226
4,47,226
50,912
Nil
31,452
-
31,452
Nil
Nil
Nil
Nil
Nil
Rs. 78,26,455
31,452
Nil
31,452
2,26,326
17,33,562
19,59,888
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
(II) Employee Stock Option Scheme - 2006
A.
PRE BONUS ISSUE 2008
ESOP SERIES
Particulars
(1)
(a)
(1) Options granted (Pre Bonus Issue)
Options Outstanding and adjusted
consequent to Bonus Issue#
(2) Options granted Post Bonus Issue
(Equity shares of Rs. 2/- each)
(b)
The pricing formula
2006
(2)
53,35,750
1,06,71,500
6,94,270
2006-A
(3)
-
-
29,06,240
The latest available closing price on
National Stock Exchange of India
Limited on August 31, 2006, preceding
the date of initial grant i.e., September
1, 2006 – Rs. 2,404/ per share.
The latest available closing price on National
Stock Exchange of India Limited on June 29,
2007, preceding the date of grant i.e, July 1,
2007 – Rs. 2,198/- per share (Discounted
grant price per share – Rs. 1,202/-)
# Consequent to the issue of Bonus Shares the total number of Options in force as at the record date for Bonus Issue i.e., September 29, 2006
was readjusted in number in the ratio of Bonus Issue (1:1) i.e. 1,06,71,500 Equity Shares and the above exercise price of Rs. 2,404/- was
readjusted to Rs. 1,202/-.
35
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
(II) Employee Stock Option Scheme - 2006
A.
PRE BONUS ISSUE 2008 (Contd.)
ESOP SERIES
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
Particulars
(1)
Options vested
Options exercised
Total number of shares arising as a result of
exercise of Options (Equity shares of Rs. 2/- each)
Options lapsed and/or withdrawn
Variation of terms of Options
2006
(2)
20,13,200
12,80,677
12,80,677
32,72,955
Nil
Money realised by exercise of Options
153,93,73,754
Total Number of Options in force –
Vested
Unvested
Total
Employee-wise details of Options granted to –
i)
ii) Any other employee who receives a grant,
Senior Managerial Personnel
iii)
in any one year, of Options amounting to 5%
or more of Options granted during that year
Identified employees who were granted
Options, during any one year, equal to or
exceeding 1% of the issued capital (excluding
outstanding warrants and conversions) of the
Company at the time of grant
6,97,138
61,15,000
68,12,138
None
None
None
2006-A
(3)
40,524
25,034
25,034
1,80,428
Nil
3,00,90,868
14,844
26,85,934
27,00,778
Consequent to the issue of Bonus Shares 2008 the total number of Options in force as above as at the record date for Bonus issue i.e. October 3, 2008
was readjusted in number in the ratio of Bonus Issue (1:1) and the above exercise price of Rs. 1202/- was readjusted to Rs. 601/-.
B.
POST BONUS ISSUE 2008
Particulars
(1)
2006
(2)
(a)
(1) Options granted (outstanding and adjusted
1,36,24,276
consequent to Bonus Issue
(2) Options granted Post Bonus Issue
(Equity shares of Rs. 2/- each)
The pricing formula
(Adjusted grant price per share)
Options vested
(Adjusted on Bonus Issue)
Add: Vested post Bonus Issue
Total
Options exercised
Total number of shares arising as a result of
exercise of Options (Equity shares of Rs. 2/- each)
Nil
1,36,24,276
13,94,276
40,48,750
54,43,026
37,516
37,516
(b)
(c)
(d)
(e)
36
ESOP SERIES
Rs. 601/-
2006-A
(3)
54,01,556
6,46,295
60,47,851
29,688
2,75,608
3,05,296
19,012
19,012
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
(II) Employee Stock Option Scheme - 2006
B.
POST BONUS ISSUE 2008 (Contd.)
ESOP SERIES
(f)
(g)
(h)
(i)
(j)
(k)
(l)
Particulars
(1)
Options lapsed and/or withdrawn
Variation of terms of Options
Money realised by exercise of Options
Total Number of Options in force –
Vested
Unvested
Total
Employee-wise details of Options granted to –
i)
ii) Any other employee who receives a grant,
Senior Managerial Personnel
iii)
in any one year, of Options amounting to 5%
or more of Options granted during that year
Identified employees who were granted
Options, during any one year, equal to or
exceeding 1% of the issued capital (excluding
outstanding warrants and conversions) of the
Company at the time of grant
2006
(2)
2,61,900
Nil
2,25,47,116
53,21,810
80,03,050
1,33,24,860
2006-A
(3)
1,33,664
Nil
1,14,26,212
2,79,136
56,16,039
58,95,175
None
None
None
Employee Stock Ownership Scheme -1999-2003 and Employee Stock Option Scheme - 2006
Diluted Earning per Share (EPS) pursuant to issue (a) Diluted EPS before extraordinary items Rs. 45.68
of shares on exercise of Options calculated in
accordance with Accounting Standards (AS) 20
(b) Diluted EPS after extraordinary items Rs. 58.70
The difference between employee compensation
cost using intrinsic value method and the fair
value of the Options and impact of this difference
on profits and on EPS.
Had fair value method been adopted for expensing the ESOP compensation:
(a)
the ESOP compensation charge debited to P&L A/c for the year 2008-2009 would
have been higher by Rs. 93.74 crore (excluding Rs. 0.55 crore on account of grants
to employees of subsidiary companies)
(b) Basic EPS before extraordinary items would have decreased from Rs. 46.30 per
share to Rs. 44.70 per share
(c) Basic EPS after extraordinary items would have decreased from Rs. 59.50 per share
to Rs. 57.90 per share.
(d) Diluted EPS before extraordinary items would have decreased from Rs. 45.68 per
share to Rs. 44.10 per share.
(e) Diluted EPS after extraordinary items would have decreased from Rs. 58.70 per
share to Rs. 57.12 per share.
(m)(i)
(a) Weighted average exercise prices of Options Rs. 508.69 per option
granted during the year where exercise price
is less than market price.
(b) Weighted average exercise prices of Options No such grants during the year
granted during the year where exercise price
equals market price.
(ii)
(a) Weighted average fair values of Options
Rs. 670.71 per option
granted during the year where exercise price
is less than market price.
(b) Weighted average fair values of Options
granted during the year where exercise
price equals market price.
No such grants during the year
37
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
Employee Stock Ownership Scheme - 1999-2003 and Employee Stock Option Scheme - 2006
Particulars
ESOP SERIES
(n)
Method and significant assumptions used to
estimate the fair value of Options granted during
the year.
(a) Method
(b) Significant Assumptions
Black-Scholes Method
(i) Weighted average risk-free interest rate
8.60%
(ii) Weighted average expected life of Options 3.75 years
(iii) Weighted average expected volatility
44.40%
(iv) Weighted average expected dividends
Rs. 39.42 per option
(v) Weighted average market price
Rs. 1,018.59 per share
Notes: 1. The weighted average exercise price and fair values of the options have been computed after considering bonus issue.
Auditors’ certificate on employee stock option schemes
We have examined the books of account and other relevant records and based on the information and explanations given to us, certify that in our opinion,
the Company has implemented the Employee Stock Option Schemes in accordance with SEBI (Employee Stock Option Schemes and Employee Stock
Purchase Scheme) Guidelines, 1999 and the resolutions of the Company in general meetings held on August 26, 1999, August 22, 2003 and August 25, 2006.
Mumbai, May 28, 2009
SHARP & TANNAN
Chartered Accountants
by the hand of
F. M. Kobla
Partner
Membership No. 15882
38
Annexure ‘C’ to the Directors’ Report
A. CORPORATE GOVERNANCE
Corporate Governance is the application of best management practices, compliance of law and adherence to ethical standards to achieve
the Company’s objective of enhancing shareholder value and discharge of social responsibility. The Corporate Governance Structure in the
Company assigns responsibilities and entrusts authority among different participants in the organization viz., the Board of Directors, the
senior management, employees etc. The Company had infact adopted Corporate Governance and disclosure practices much before these
were mandated by legislation.
B. COMPANY’S CORPORATE GOVERNANCE PHILOSOPHY
The Company’s essential character revolves around values based on transparency, integrity, professionalism and accountability. At the
highest level the Company continuously endeavors to improve upon these aspects on an ongoing basis and adopts innovative approaches
for leveraging resources, converting opportunities into achievements through proper empowerment and motivation, fostering a healthy
growth and development of human resources to take the Company forward.
C.
Strategic Supervision – by the Board of Directors comprising the Executive and Non-Executive Directors
THE GOVERNANCE STRUCTURE
The Company has four tiers of Corporate Governance structure, viz.:
(i)
(ii) Executive Management – by the Corporate Management comprising the Executive Directors
(iii) Strategy & Operational Management – by the operating Company Board of verticals in each Operating Division
(iv) Operational Management – by the Strategic Business Unit (SBU) Heads
The four-tier governance structure besides ensuring greater management accountability and credibility, facilitates increased autonomy of
businesses, performance discipline and development of business leaders, leading to increased public confidence.
D. ROLES OF VARIOUS CONSTITUENTS OF CORPORATE GOVERNANCE IN THE COMPANY
a. Board of Directors (the Board):
The Directors of the Company are in a fiduciary position, empowered to oversee the management functions with a view to ensure its
effectiveness and enhancement of shareholder value. The Board reviews and approves management’s strategic plan & business
objectives and monitors the Company’s strategic direction.
b. Corporate Management (CM):
The main function of the Corporate Management is strategic management of the Company’s businesses within Board approved
direction and framework. This includes ensuring that effective systems are in place for appropriate reporting to the Board on important
matters.
c. Chairman & Managing Director (CMD):
d.
The CMD is the Chief Executive of the Company. He is the Chairman of the Board and the Corporate Management. His primary role
is to provide leadership to the Board and the Corporate Management for realizing the approved strategic plan and business objectives.
He presides over the meetings of the Board and the Shareholders.
Executive Directors (ED):
The Executive Directors, as members of the Board and the Corporate Management, contribute to the strategic management of the
Company’s businesses within Board approved direction and framework. They assume overall responsibility for strategic management
of business and corporate functions including its governance processes and top management effectiveness. As regards Subsidiaries,
Associates and Joint Venture Companies, they act as the custodians of the Company’s interests and are responsible for their governance
in accordance with the approved plans.
e. Non-Executive Directors (NED):
The Non-Executive Directors play a cruical role in enhancing balance to the Board processes with their independent judgment on
issues of strategy, performance, resources, standards of conduct, etc., besides providing the Board with valuable inputs.
E. BOARD OF DIRECTORS
a. Composition of the Board:
As on date the Board comprises Chairman & Managing Director, 7 Executive Directors and 9 Non-Executive Directors. The composition
of the Board is in conformity with Clause 49 of the Listing Agreement.
b. Meetings of the Board:
The Meetings of the Board are generally held at the Registered Office of the Company at L&T House, Ballard Estate, Mumbai 400 001.
However, during the year, a Board Meeting was held at L&T Knowledge City, Baroda on January 2, 2009. During the year under
review, 10 Meetings were held on May 29, 2008, July 28, 2008, September 20, 2008, October 15, 2008, December 31, 2008, January
2, 2009, January 14, 2009, January 21, 2009, January 30, 2009 and March 25, 2009.
The Company Secretary prepares the agenda and the explanatory notes, in consultation with the Chairman & Managing Director and
circulates the same in advance to the Directors. Every Director is free to suggest inclusion of items on the agenda. The Board meets
39
at least once every quarter inter alia to review the quarterly results. Additional Meetings are held, when necessary. Presentations are
made to the Board by atleast one Operating Division in a year for a complete review of its business. The Minutes of the proceedings
of the Meetings of the Board of Directors are noted and the draft minutes are circulated amongst the Members of the Board for their
perusal. Comments, if any, received from the Directors are also incorporated in the Minutes, in consultation with the Chairman &
Managing Director. The minutes are approved by the Members of the Board at the next Meeting. Senior management personnel are
invited to provide additional inputs for the items being discussed by the Board of Directors as and when necessary.
The composition of the Board of Directors is as on May 28, 2009. Their attendance at the Meetings during the year and at the last
Annual General Meeting as also number of other Directorships & Memberships of Committees as on March 31, 2009 are as follows:
Name of Director
Mr. A. M. Naik
Mr. J. P. Nayak
Mr. Y. M. Deosthalee
Mr. K. Venkataramanan
Mr. R. N. Mukhija
Mr. K. V. Rangaswami
Mr. V. K. Magapu
Mr. M. V. Kotwal
Mr. S. Rajgopal
Mr. S. N. Talwar
Mr. M. M. Chitale
Mr. Thomas Mathew T. $
Mr. N. Mohan Raj $
Mr. Subodh Bhargava
Mrs. Bhagyam Ramani @
Mr. A. K. Jain #~
Mr. J. S. Bindra *
Nature of
Directorship
No of Board
Meetings
attended
No of other
Attendance
at last AGM Directorships Committee
No. of
No. of
Committee
Membership Chairmanship
CMD
ED
ED
ED
ED
ED
ED
ED
NED
NED
NED
NED
NED
NED
NED
NED
NED
10
9
10
10
9
9
10
10
9
10
10
5
8
10
6
9
1
YES
YES
YES
YES
YES
YES
YES
YES
YES
YES
YES
NO
NO
YES
YES
YES
N.A.
2
10
11
4
1
4
2
–
1
14
7
3
1
11
3
2
–
–
1
1
–
2
2
1
–
1
8
3
1
2
5
1
3
–
–
5
4
2
–
–
–
–
–
4
4
1
–
4
–
–
–
None of the above Directors are related inter-se.
$ Representing equity interest of LIC
@ Representing equity interest of GIC
# Representing equity interest of SUUTI
~ Appointed on May 29, 2008
* Appointed w.e.f January 30, 2009
c.
CMD – Chairman & Managing Director
ED – Executive Director
NED – Non-Executive Director
Information to the Board:
The Board of Directors has complete access to the information within the Company, which inter alia includes -
(cid:2)
Annual revenue budgets and capital expenditure plans
Quarterly results and results of operations of operating divisions and business segments
Financing plans of the Company
(cid:2)
(cid:2)
(cid:2) Minutes of meeting of Audit Committees and Nomination & Compensation Committees
(cid:2)
Details of any joint venture, acquisitions of companies or collaboration agreement
(cid:2) Materially fatal or serious accidents or dangerous occurrences, any material effluent or pollution problems
(cid:2)
Any materially relevant default, if any, in financial obligations to and by the Company or substantial non-payment for goods sold
or services rendered, if any
Any issue, which involves possible public or product liability claims of substantial nature, including any Judgment or Order, if any,
which may have strictures on the conduct of the Company
Developments in respect of human resources
Compliance or Non-compliance of any regulatory, statutory nature or listing requirements and investor service such as non-
payment of dividend, delay in share transfer etc., if any
(cid:2)
(cid:2)
(cid:2)
40
F.
BOARD COMMITTEES
The Board currently has 3 Committees: 1) Audit Committee, 2)
Nomination and Compensation Committee and 3) Shareholders’/
Investors’ Grievance Committee. The Board is responsible for
constituting, assigning and co-opting the members of the
Committees.
1) Audit Committee
The role of the Audit Committee includes the following:
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
Overseeing the Company’s financial reporting process
and disclosure of its financial information
Recommending the appointment of the Statutory
Auditors and fixation of their remuneration
Reviewing and discussing with the Statutory Auditors
and the Internal Auditor about internal control systems
Reviewing the adequacy and independence of the
Internal Audit function, and observations of the Internal
Auditor
Reviewing major accounting policies and practices
and adoption of applicable Accounting Standards
Reviewing major accounting entries involving exercise
of judgment by the management
Disclosure of contingent liabilities
Reviewing, if necessary, the findings of any internal
investigations by the Internal Auditors and reporting
the matter to the Board
Reviewing the risk management mechanisms of the
Company
Reviewing of compliance with Listing Agreement and
various other legal requirements concerning financial
statements and related party transactions
Reviewing the Quarterly and Half yearly financial
results and the Annual financial statements before
they are submitted to the Board of Directors
Reviewing the operations, new initiatives and
performance of the business divisions
Looking into the reasons for substantial defaults in
payments to depositors, debenture holders,
shareholders(in case of non-payment of declared
dividends) and creditors, if any
Minutes of the Audit Committee Meetings are circulated to the
Members of the Board of Directors and taken note of.
The Audit Committee of the Board of Directors was formed in
1986 and as on March 31, 2009 comprises three Non-executive
Directors, all of whom are independent.
The Committee met 7 times during the year on April 26, 2008,
May 16, 2008, May 28, 2008, July 28, 2008, October 15, 2008,
January 21, 2009 and January 30, 2009. The attendance of
Members at the Meetings was as follows-
Name
Status
No. of Meetings
Attended & Remarks
Mr. M. M. Chitale
Mr. N. Mohan Raj
Mrs. Bhagyam Ramani
Chairman
Member
Member
7
5
6
All the members of the Audit Committee are financially literate
and have accounting or related financial management expertise.
The Chief Financial Officer and the Chief Internal Auditor are
permanent invitees to the Meetings of the Audit Committee. The
Company Secretary is the Secretary to the Committee.
The Company’s Internal Audit function is ISO 9001:2000 certified.
2) Nomination & Compensation Committee
i)
Terms of reference:
To review, assess and recommend the appointment
of Executive and Non-Executive Directors and, to
review their remuneration package, to recommend
compensation to the Non-Executive Directors in
accordance with the provisions of the Companies Act,
1956, to consider and recommend Employee Stock
Option Schemes and to administer and superintend
the same.
ii) Composition:
The Committee has been in place since 1999. As at
March 31, 2009, the Committee comprises 3 Non-
Executive Directors and the Chairman & Managing
Director.
The Committee met 7 times during the year on May
28, 2008, July 28, 2008, September 20, 2008, October
15, 2008, December 31, 2008, January 30, 2009 and
March 24, 2009. The attendance of Members at the
Meetings was as follows-
Name
Status
Mr. S. Rajgopal
Mr. S. N. Talwar
Mr. Subodh Bhargava
Mr. A. M. Naik
Chairman
Member
Member
Member
iii) Remuneration Policy
No. of Meetings
Attended &
Remarks
6
7
7
7
The objectives of the remuneration policy are to
motivate employees to excel in their performance,
recognize their contribution, retain talent and reward
merit. Remuneration of employees largely consists
of base remuneration, perquisites and performance
incentives.
The components of the remuneration vary for different
grades and are governed by industry pattern,
qualifications, experience, responsibilities handled,
individual performance, etc.
iv) Details of remuneration paid / payable to Directors
for the year ended March 31, 2009:
(a) Executive Directors:
The details of remuneration paid / payable to the
Executive Directors is as follows-
Names
Salary
(Rs. Lakh)
Perquisites Retirement Commission
Benefits
Mr. A. M. Naik
Mr. J. P. Nayak
Mr. Y. M. Deosthalee
Mr. K. Venkataramanan
Mr. R. N. Mukhija
Mr. K. V. Rangaswami
Mr. V. K. Magapu
Mr. M. V. Kotwal
132.00
69.00
72.00
69.00
66.00
63.00
63.00
60.00
15.00
15.00
87.89
87.38
86.73
12.24
12.60
69.99
263.66
132.64
133.45
132.64
131.82
108.22
108.22
107.40
844.50
422.25
422.25
422.25
422.25
337.80
337.80
337.80
41
(cid:2)
(cid:2)
(cid:2)
Notice period for termination of appointment of Chairman
& Managing Director and other Whole-time Directors is six
months on either side.
No severance pay is payable on termination of
appointment.
Details of Options granted under Employee Stock Option
Schemes are given in Annexure ‘B’ to the Directors’ Report
(b) Non-Executive Directors:
The Non-Executive Directors are paid sitting fees
@ Rs. 20,000/- per meeting of the Board or its
Committees. The amount of commission paid to
each Non-Executive Director is decided by the
Board of Directors on the basis of the following
criteria -
i.
Number of Board / Committee Meetings
attended
Chairmanship of Committees
ii.
As required by the provisions Clause 49 of the
Listing Agreement, the criteria for payment to
Non-Executive Directors is made available on
the investor page of our corporate website
www.larsentoubro.com
The details of remuneration paid / payable to the
Non-Executive Directors is as follows-
Names
Sitting Fees
Commission
(Rs. Lakh)
Mr. S. Rajgopal
Mr. S. N. Talwar
Mr. M. M. Chitale
Mr. Thomas Mathew T.
Mr. N. Mohan Raj
Mr. Subodh Bhargava
Mrs. Bhagyam Ramani
Mr. A. K. Jain
Mr. J. S. Bindra
3.00
3.40
3.40
1.20*
2.60*
3.40
2.40*
2.40
0.20
7.50
6.50
7.50
7.50*
6.50*
6.50
6.50*
6.50*
1.50
* Payable to respective Institutions they represent.
Details of shares and convertible instruments
held by the Non-Executive Directors as on date
are as follows –
Names
No. of Shares held
Mr. S. Rajgopal #
Mr. S.N.Talwar
Mr. M.M. Chitale
Mr. Thomas Mathew T *
Mr. N. Mohan Raj *
Mr. Subodh Bhargava
Mrs. Bhagyam Ramani *
Mr. A. K. Jain *
Mr. J. S. Bindra
900
6,000
550
200
200
500
200
400
100
* held jointly with the Institution they represent
# has been granted 60,000 stock options
3)
Shareholders’ / Investors’ Grievance Committee:
Terms of reference:
The terms of reference of the Shareholders’ / Investors’
Grievance Committee are as follows:
(cid:2)
Redressal of Shareholders’ / Investors’ complaints
42
(cid:2)
Allotment, transfer & transmission of Shares/
Debentures or any other securities and issue of
duplicate certificates and new certificates on split/
consolidation/renewal etc. as may be referred to it by
the Share Transfer Committee.
Composition:
As on March 31, 2009 the Shareholders’ / Investors’
Grievance Committee comprises of 2 Non-Executive
Directors and 2 Executive Directors.
During the year, the Committee held 4 meetings on May
29, 2008, July 28, 2008, October 15, 2008 and January
30, 2009. The attendance of Members at the Meetings was
as follows-
Name
Status
Mr. Thomas Mathew T.
Mr. J. P. Nayak
Mr. R. N. Mukhija
Mr. A. K. Jain
Chairman
Member
Member
Member
No. of Meetings
Attended
1
4
3
3 *
* Appointed on May 29, 2008.
Mr. N. Hariharan, Company Secretary is the Compliance
Officer.
During the year, 113 letters were received, all of which were
responded to / resolved. As on March 31, 2009, 69 requests
involving transfer of 7,098 shares were under process.
These requests were less than ten days old and have since
been processed.
Complaints from Investors are resolved expeditiously
except matters which are sub-judice.
The Board has delegated the powers to approve transfer
of shares to a committee of three Senior Executives. This
Committee held 48 meetings during the year and approved
the transfer of shares lodged with the Company.
G. OTHER INFORMATION
a) Risk Management Framework:
The Company has in place mechanisms to inform Board
Members about the risk assessment and minimization
procedures and periodical review to ensure that executive
management controls risk by means of a properly defined
framework.
A detailed note on risk management is given in the Financial
Review section of Management’s Discussion and Analysis
report elsewhere in this Report.
b) Code of Conduct:
The Company has laid down a code of conduct for all Board
members and senior management personnel. The code of
conduct is available on the website of the Company
www.larsentourbo.com. The declaration of Chairman &
Managing Director is given below:
To the Shareholders of Larsen & Toubro Limited
Sub: Compliance with Code of Conduct
I hereby declare that all the Board Members and Senior
Management Personnel have affirmed compliance with the
Code of Conduct as adopted by the Board of Directors.
A. M. Naik
Chairman & Managing Director
Date: May 26, 2009
Place: Mumbai
c) General Body Meetings:
Procedure for Postal Ballot
The last three Annual General Meetings of the Company
were held at Birla Matushri Sabhagar, Mumbai as under:
Date
Financial Year
Time
2007-2008
2006-2007
2005-2006
August 29, 2008
August 24, 2007
August 25, 2006
3.00 p.m.
2.15 p.m.
3.00 p.m.
The following Special Resolutions were passed by the members
at the past 3 Annual General Meetings:
Annual General Meeting held on August 29, 2008:
(cid:2)
Raising of capital through QIP’s by issue of shares /
convertible debentures / securities upto an amount of USD
600 million or Rs. 2400 crores.
Appointment of Statutory Auditors and remuneration
payable to them.
(cid:2)
Annual General Meeting held on August 24, 2007:
(cid:2)
Raising of capital in Indian and/or International market by
issue of shares/ securities.
Appointment of Statutory Auditors and remuneration
payable to them.
(cid:2)
Annual General Meeting held on August 25, 2006:
(cid:2)
Introduction and implementation of ESOP Scheme-2006
and to issue upto 5% of the equity capital to employees
including Executive Directors and Non-Executive Directors
of the Company.
Offering the benefits of ESOP Scheme 2006 to the eligible
employees of subsidiary companies as permitted by law
to eligible employees of Associate Companies.
Appointment of Statutory Auditors and remuneration
payable to them.
(cid:2)
(cid:2)
d) Approval by Members through Postal Ballot:
The Company sought approval of the Members, for passing
a Special Resolution under Section 293(1)(a) of the
Companies Act, 1956, for restructuring the business of the
Company including by transferring, selling and / or
disposing of the Medical Equipment & System (“MED”)
Business unit of the Company to its subsidiary company
or to any other entity as a going concern as may be
approved by the Board. Mr. S. N. Ananthasubramanian,
Practising Company Secretary, was appointed as the
Scrutinizer for conducting the Postal Ballot process. The
details of the voting pattern are as under:
Particulars
In favour of the
Resolution
Against the
Resolution
Total
No. of Votes
cast
% of total votes
cast
15,57,24,533
99.42
9,09,463
15,66,33,996
0.58
100.00
Number of Invalid Ballots (unsigned/unticked) was 376. The
Resolution was approved by an overwhelming majority of
the Members.
After receiving the approval of the Board of Directors, Notice
of the Postal Ballot, text of the Resolution and Explanatory
Statement, relevant documents, Postal Ballot Form and
self-addressed postage pre-paid envelopes are sent to the
shareholders to enable them to consider and vote for or
against the proposal within a period of 30 days from the
date of dispatch. The calendar of events containing the
activity chart is filed with the Registrar of Companies within
7 days of the passing of the Resolution by the Board of
Directors. After the last date for receipt of ballots, the
Scrutinizer, after due verification, submits the results to the
Chairman. Thereafter, the Chairman declares the result of
the Postal Ballot. The same is published in the Newspapers
and displayed on Website and Notice board.
e) Disclosures:
1. During the year, there were no transactions of material
nature with the Directors or the Management or the
subsidiaries or relatives that had potential conflict with
the interests of the Company.
2.
There were no instances of non-compliance on any
matter related to the capital markets, during the last
three years.
f) Means of communication:
Company’s
1.
corporate
The
website
www.larsentoubro.com provides comprehensive
information about its portfolio of businesses. Section
on “Investors” serves to inform and service the
Shareholders allowing them to access information at
their convenience. The entire Report and Accounts
are available in downloadable formats.
2. Quarterly & Annual Results are published in prominent
daily newspapers viz. The Business Standard, The
Financial Express, The Hindu Business Line &
Loksatta.
3.
Information to Stock Exchanges is now being filed
through corp-filing. Investors can view this information
by visiting the website www.corpfiling.co.in.
4. Official news releases, presentations etc. made to
Institutional Investors and the shareholding pattern
of the Company, on a quarterly basis are displayed
on the Company’s website: www.larsentoubro.com.
5. Management’s Discussion & Analysis forms part of
the Annual Report, which is mailed to the shareholders
of the Company.
GENERAL SHAREHOLDERS’ INFORMATION
a) Annual General Meeting:
The Annual General Meeting of the Company has been convened
on Friday, August 28, 2009 at Birla Matushri Sabhagar, Marine Lines,
Mumbai – 400 020 at 3.00 p.m.
43
b)
Financial calendar:
1. Annual Results of 2008-09
May 28, 2009
2. Mailing of Annual Reports
Second week of July, 2009
3. First Quarter Results
Around third week of July, 2009
4. Annual General Meeting
August 28, 2009
5. Payment of Dividend
September 2, 2009
6. Second Quarter results
End of October, 2009
7. Third Quarter results
End of January, 2010
c) Book Closure:
The dates of Book Closure are from Friday, August 21, 2009 to
Friday, August 28, 2009 (both days inclusive) to determine the
members entitled to the dividend for 2008-2009.
(cid:2)
Post Bonus
d)
Listing of equity shares / shares underlying GDRs on
Stock Exchanges:
The shares of the Company are listed on The Bombay Stock
Exchange Limited (BSE) and the National Stock Exchange of
India Limited (NSE).
Shares underlying GDRs are listed on Luxembourg Stock
Exchange and London Stock Exchange.
e)
Listing Fees to Stock Exchanges:
The Company has paid the Listing Fees for the year 2009-2010
to both the above Stock Exchanges.
f)
Custodial Fees to Depositories:
The Company has paid custodial fees for the year 2009-2010
to National Securities Depository Limited and Central Depository
Services (India) Limited.
g) Stock Code/Symbol:
BSE : 500510
NSE : LT
ISIN No. : INE018A01030
Reuters RIC: LART.BO
The Company’s shares constitute a part of BSE 30 Index of the
Bombay Stock Exchange Limited as well as NIFTY Index of the
National Stock Exchange of India Limited.
h) Stock market price data for the year 2008-2009:
(cid:2)
Pre-Bonus
Month
L&T BSE Price (Rs.)
BSE SENSEX
2008
April
May
June
July
High
Low
Month Close
High
Low
Month Close
3,085.00
2,545.00
3,003.35
17,480.74
15,297.96
17,287.31
3,262.00
2,666.00
2,981.35
17,735.70
16,196.02
16,415.57
3,038.00
2,165.00
2,183.20
16,632.72
13,405.54
13,461.60
2,814.90
2,100.00
2,602.70
15,130.09
12,514.02
14,355.75
August
2,930.00
2,480.15
2,589.85
15,579.78
14,002.43
14,564.53
September
2,825.00
2,256.00
2,442.85
15,107.10
12,153.55
12,860.43
44
Month
2008
L&T BSE Price (Rs.)
BSE SENSEX
High
Low
Month Close
High
Low
Month Close
October
1,250.00
680.00
805.45
13,203.86
7,697.39
9,788.06
November
960.00
December
843.70
700.00
670.00
726.95
10,945.41
8,316.39
9,092.72
774.40
10,188.54
8,467.43
9,647.31
2009
January
February
March
867.90
711.00
693.70
611.00
598.25
557.00
689.20
10,469.72
8,631.60
9,424.24
611.45
9,724.87
8,619.22
8,891.61
672.65
10,127.09
8,047.17
9,708.50
i)
j)
Registrar and Share Transfer Agents:
Sharepro Services (India) Private Limited, Mumbai.
Share Transfer System:
The Company’s Shares are required to be compulsorily traded
in the Stock Exchanges in dematerialized form. Shares in
physical mode which are lodged for transfer are processed and
returned within the stipulated time. The share related information
is available online.
Physical shares received for dematerialization are processed
within a period of 21 days from the date of receipt. Bad deliveries
are promptly returned to Depository Participants (DP’s) under
advice to the shareholders.
k) Distribution of Shareholding as on March 31, 2009:
No. of Shares
Shareholders
Shareholding
Number
%
Number
%
Up to 500
8,81,403
94.63
6,68,22,648
11.41
501 – 1000
1001 – 2000
2001 – 3000
3001 – 4000
4001 – 5000
5001 – 10000
27,735
11,978
3,441
1,900
1,028
2,033
10001 and above
1,845
2.98
1.29
0.37
0.20
0.11
0.22
0.20
2,03,20,177
1,71,58,595
85,13,817
67,13,214
46,60,729
1,42,19,637
3.47
2.93
1.45
1.15
0.80
2.43
44,72,79,045
76.36
TOTAL
9,31,363
100.00
58,56,87,862
100.00
l)
Categories of Shareholders as on March 31, 2009 is as
under:
Category
Shareholding
No. of Shares
%
Financial Institutions
18,76,10,525
Foreign Institutional Investors
Shares underlying GDRs
Mutual Funds
Bodies Corporate
Directors & Relatives
6,97,05,591
1,71,92,103
3,43,36,111
3,37,60,770
66,67,993
L&T Employees Welfare Foundation
7,44,04,116
32.03
11.90
2.94
5.86
5.77
1.14
12.70
27.66
General Public
TOTAL
16,20,10,653
58,56,87,862
100.00
m) Dematerialization of shares:
As on March 31, 2009, 96.2% of the Company’s total paid-up
capital representing 56,32,91,981 shares were held in
dematerialized form and the balance 3.8% representing
2,23,95,881 shares were held in paper form.
n) Outstanding GDRs / ADRs / Warrants or any Convertible
Instruments, conversion date and likely impact on equity:
The outstanding GDRs are backed up by underlying equity
shares which are part of the existing paid up capital.
o)
Listing of Debt Securities:
The redeemable Non-Convertible debentures issued by the
Company are listed on the Wholesale Debt Market (WDM) of
National Stock Exchange of India Limited (NSE).
p) Debenture Trustees (for privately placed debentures)
IDBI Trusteeship Services Limited
Ground Floor, Asian Building
17, R. Kamani Marg
Ballard Estate
Mumbai – 400 001
q) Plant Locations:
Manufacturing facilities of the Company and its Group are located
(within India) at Ahmednagar, Bangalore, Chennai, Coimbatore,
Faridabad, Hazira (Surat), Kansbahal (Rourkela), Mumbai,
Mysore, Pithampur, Puducherry, Pune, Vadodara and
Visakhapatnam; and in Australia, China, Indonesia, Malaysia,
Oman, Saudi Arabia and U.A.E.
r)
Address for correspondence:
Larsen & Toubro Limited,
L&T House,
Ballard Estate,
Mumbai 400 001.
Tel. No. (022) 67525 656,
Fax No. (022) 67525 893
Shareholder correspondence may be directed to the Company’s
Registrar and Share Transfer Agent, whose address is given
below:
1.
Sharepro Services (India) Private Limited-Unit:L&T
Samhita Warehousing Complex,
Bldg. No.13 A B, Gala No. 52 to 56
Near Sakinaka Telephone Exchange,
Andheri – Kurla Road, Sakinaka, Mumbai – 400 072
Tel No. : (022) 6772 0300 / 6772 0400
Fax No. : (022) 2859 1568 / 2850 8927
E-Mail : lnt@shareproservices.com; sharepro@vsnl.com
45
2.
Sharepro Services (India) Private Limited-Unit:L&T
912, Raheja Centre, Free Press Journal Road,
Nariman Point, Mumbai 400 021.
Tel : (022) 6613 4700
Fax : (022) 2282 5484
s)
Investor Grievances:
The Company has an exclusive e-mail id viz. igrc@lth.ltindia.com
to enable investors to register their complaints, if any. The
Company strives to reply to the complaints within a period of 3
working days.
t)
Non-mandatory requirements on Corporate Governance
recommended under the Clause 49 of the Listing
Agreement:
The Company has adopted the following non-mandatory
requirements on Corporate Governance recommended under
Clause 49 of the Listing Agreement:
1.
A Nomination & Compensation Committee is in place since
1999. The Committee comprises of three Non-Executive
Directors and the Chairman & Managing Director of the
Company.
2. Whistle Blower policy for L&T and its group companies is
in place.
Access to the Audit committee of the Board is also available.
3.
u) Securities Dealing Code:
Pursuant to the SEBI (Prohibition of Insider Trading) Regulations
1992, a Securities Dealing Code for prevention of insider trading
is in place. The objective of the Code is to prevent purchase
and/or sale of shares of the Company by an Insider on the basis
of unpublished price sensitive information. Under this Code,
Designated Persons (Directors, Advisors, Officers and other
concerned employees/persons) are prevented from dealing in
the Company’s shares during the closure of Trading Window.
To deal in securities beyond specified limit, permission of
Compliance Officer is also required. All the Designated
Employees are also required to disclose related information
periodically as defined in the Code.
Mr. N. Hariharan, Company Secretary has been designated as
the Compliance Officer.
v)
ISO 9001:2000 Certification:
The Company’s Secretarial Department which provides
secretarial services and investor services for the Company and
its Subsidiary and Associate Companies is ISO 9001:2000
certified.
w) Secretarial Audit for Capital Reconciliation:
As stipulated by SEBI, a Qualified Practising Company Secretary
carries out Secretarial Audit to reconcile the total admitted capital
with National Securities Depository Limited (NSDL) and Central
Depository Services (India) Limited (CDSL) and the total issued
and listed capital. This audit is carried out every quarter and the
report thereon is submitted to the Stock Exchanges. The Audit
confirms that the total Listed and Paid-up capital is in agreement
with the aggregate of the total number of shares in dematerialized
form and in physical form.
Chief Executive Officer (CEO) and Chief Financial Officer (CFO) certification
To the Board of Directors of Larsen & Toubro Limited
Dear Sirs,
Sub: CEO / CFO certificate
(Issued in accordance with provisions of clause 49 of the Listing Agreement)
We have reviewed the financial statements, read with the cash flow statement of Larsen & Toubro Limited for the year ended March 31, 2009 and
that to the best of our knowledge and belief, we state that;
(a)
(i)
These statements do not contain any materially untrue statement or omit any material fact or contain statements that may be misleading;
(ii) These statements present a true and fair view of the Company’s affairs and are in compliance with current accounting standards,
applicable laws and regulations.
(b) There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year which are fraudulent,
illegal or in violation of the Company’s code of conduct.
(c) We accept responsibility for establishing and maintaining internal controls for financial reporting. We have evaluated the effectiveness of
internal control systems of the Company and have disclosed to the Auditors and the Audit Committee, deficiencies in the design or operation
of internal controls, if any, and steps taken or proposed to be taken for rectifying these deficiencies.
(d) We have indicated to the Auditors and the Audit Committee:
(i)
(ii)
Significant changes in accounting policies made during the year and that the same have been disclosed suitably in the notes to the
financial statements; and
Instances of significant fraud of which we have become aware and the involvement therein, if any, of the management or an employee.
Y. M. Deosthalee
Chief Financial Officer
A. M. Naik
Chairman & Managing Director
Yours sincerely,
Place: Mumbai
Date: May 28, 2009
46
Auditors certificate on compliance of conditions of corporate governance
To the members of Larsen & Toubro Limited
We have examined the compliance of conditions of corporate governance by Larsen & Toubro Limited for the year ended March 31, 2009 as
stipulated in clause 49 of the listing agreement entered into by the Company with the stock exchanges.
The compliance of conditions of corporate governance is the responsibility of management. Our examination was limited to procedures and
implementation thereof, adopted by the Company for ensuring the compliance of the conditions of corporate governance. 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 has complied in all
material respects with the conditions of corporate governance as stipulated in the above mentioned listing agreement.
We state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which
management has conducted the affairs of the Company.
Mumbai, May 28, 2009
SHARP AND TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No. 15882
47
Management Discussion & Analysis 2008-2009
Review of the Economic Scenario
was accentuated due to contraction in the
The Indian economy began the year 2008-
2009 on a confident note. Sound economic
fundamentals, encouraging performance by
the country's infrastructure & core sectors and
buoyant global economic conditions were
conducive for maintaining the investment
demand for petroleum products. This
heightened the uncertainty for new capital
investments in oil exploration and distribution
in the Gulf countries. These developments
posed significant challenges for the
international business of the Engineering and
momentum. However, the global financial
Construction segment.
turmoil emerging from sub-prime crisis in the
US, extreme volatility in the prices of crude oil,
steel, cement & other key raw materials and
liquidity constraints led to a slowdown in the
Business Performance
Countering the adverse business conditions,
the Company achieved satisfactory growth in
complemented by a focused organisation
structure. The Company’s profitability was
protected from input cost volatility due to
efficient contract structuring. The product
businesses, however had to bear the burden
of higher input costs without corresponding
higher realisation from the market.
At the Group level, the total income registered
a significant increase over the previous year
driven by a satisfactory performance of the
parent company and its flagship subsidiaries.
domestic economy .
the order inflow during 2008-2009. The
Strategic Initiatives
Engineering and Construction segment was
Consequently, the country's GDP growth for
able to garner project orders not only in
the year 2008-2009 dropped to 6.7% against
traditional sectors such as Hydrocarbon and
the growth of around 9% seen during the past
Infrastructure, but were also successful in
few years. Almost all the sectors of the
bagging orders in the emerging sectors such
economy witnessed considerable moderation
as Railways and Power. The orders came
in the growth trends.
In particular,
mainly from the domestic market.
manufacturing and capital goods sectors
were adversely impacted by the credit
squeeze and low demand forcing the
postponement of industrial expansion plans.
The sales growth during the year 2008-2009
was impressive on the back of healthy
performance of
the Engineering &
Construction
segment. The product
The Index of Industrial Production for 2008-
businesses, however, saw severe curtailment
2009 showed a growth of around 2.3% as
in the demand for industrial goods due to
compared to the growth of 8.5% in the
economic slowdown and therefore could
previous year. Similarly, the construction
register only a marginal growth in revenues
sector showed a lower growth rate of around
for the year as a whole.
7.2 % as compared to 10.1 % in the previous
year. The adverse impact was also felt in many
government sponsored
infrastructure
projects owing to credit crunch and tighter
monetary policies adopted to combat
inflation.
The economies in the Gulf region, once
holding promising business prospects, were
also not spared from the brunt of global
economic down-turn, especially after the
crude oil prices decreased sharply during the
last quarter of fiscal 2008-2009. The problem
48
The order book as on March 31, 2009 at Rs.
70,319 crore provides a strong visibility to the
Company's sales revenue during 2009-2010
and 2010-2011 even in the face of a
continuing economic downturn.
The Company has recorded a healthy increase
in the profitability driven by improved
margins of Engineering & Construction
segment demonstrating the Company's
superior project execution capabilities and a
The Company is well on its course to meet its
strategic plan target as per "Project Lakshya
2010", despite the challenges being
experienced currently due to economic
slowdown. This has been largely due to the
effective business strategies pursued by the
various business divisions of the Company,
encompassing capacity augmentation,
building up of superior execution capabilities,
technology tie-ups, risk analysis and
mitigation. Moreover, the strategy of bidding
for only
large projects, and thereby
economising on the critical resources, has
yielded better financial results besides taking
the L&T brand to the next higher league.
The foray into high potential businesses such
as Railways and Power equipment has been
successful during the year and boosted the
order inflow. The Company's proven EPC
capabilities in turnkey power projects are
being strengthened with major investments
in the manufacturing facilities for super critical
boilers & turbine generators at Hazira. New
fabrication yard at Sohar, Oman has added to
the EPC capability for large projects in
upstream hydrocarbon sector. To augment
heavy engineering capability to cater to the
Middle East market, an advanced fabrication
comprehensive risk mitigation framework,
facility is being set up in Oman.
Post signing of nuclear fuel treaty, new vistas
The ship building facilities have been
expected to provide customer focus &
of opportunity in the field of civilian nuclear
stabilised in Hazira with the first commercial
specialised resources for effectively meeting
power are expected to unfold during the
ship slated for delivery in 2009-2010. A new
the customer needs. The new structure is also
coming years. The Company has been playing
shipyard being set up in Kattupalli, Tamil Nadu,
expected to provide better career growth
a lead role in equipment supplies and
will mainly cater to the anticipated business
opportunities for aspiring managerial
construction in the country's domestic
prospects of construction of naval ships &
personnel.
nuclear power programmes. The Company
submarines and repair of commercial vessels.
has recently concluded several tie ups with
leading international groups in the areas of
advanced nuclear technology. A state-of-the-
art heavy forging facility for nuclear
equipment is being set up at Hazira in Gujarat.
Evaluation of existing business portfolio is an
During the year 2008-2009, a new business
on-going initiative for the Company. During
management structure was put in place by
the year 2008-2009, the Company divested its
establishing Operating Companies for the
Ready Mix Concrete business augmenting its
various businesses. The new structure is
cash flows and profit.
Year 2008-2009 at a Glance
L&T
(cid:2) New order inflow at Rs. 5,16,215 million in current year as against Rs. 4,20,190 million in previous year - 23% growth year-on-year
(cid:2) Order book as at March 31, 2009 Rs. 7,03,191 million as against Rs. 5,26,821 million as at March 31, 2008 - 33% growth year-on-year
(cid:2) Gross sales at Rs. 3,40,450 million in current year as against Rs. 2,51,875 million in previous year - 35% growth over 2007-2008
(cid:2) Segment wise composition of gross revenues:
Engineering & Construction segment - 81.9% in current year as against 75.3% in previous year
Electrical & Electronics segment - 7.9% in current year as against 10.3% in previous year
Machinery & Industrial Products segment - 7.1% in current year as against 9.3% in previous year
Others - 3.1% in current year as against 5.1% in previous year
(cid:2) PBDIT at Rs. 44,248 million in current year as against Rs. 33,180 million in previous year - up by 33%
(cid:2) PAT at Rs. 34,817 million in current year as against Rs. 21,734 million in previous year - up by 60%
(cid:2) Gross debt equity ratio of 0.53:1 (previous year 0.38:1)
L&T Group
(cid:2) Gross sales at Rs. 4,06,079 million in current year as against Rs. 2,95,611 million in previous year - 37% growth over 2007-2008
(cid:2) PAT at Rs. 37,891 million in current year as against Rs. 23,246 million in previous year - up by 63%
49
K. V. Rangaswami
Whole-time Director & President
(Construction)
83-km highway between Vadodara and Bharuch – one of the many road projects that provides a critical
link to the Golden Quadrilateral that connects India’s major metropolitan centres. Infrastructure
projects executed by L&T also include bridges, ports, airports and metro rail systems.
Engineering, Construction & Contracts Division
Overview
Engineering, Construction and Contracts
Division (ECCD) undertakes engineering
design and construction of infrastructure,
buildings, factories and industrial projects
covering civil, mechanical, electrical and
instrumentation engineering disciplines.
With many of the country's prized landmark
constructions to its credit, ECCD, India's
largest construction organisation, uses
state-of-the-art design tools and project
management techniques. Supported by a
track record of over sixty-five years, the
Division also undertakes lumpsum turnkey
construction contracts with single-source
responsibility. The Division is ranked 40th
amongst all the construction companies
world wide [source: Engineering News
Record (ENR)].
Business Environment
The busines conditions have been
challenging. Liquidity crunch and high real
interest rates have moderated the private
capital investments. Various measures
taken by the Government / RBI are, however,
expected to mitigate the effect. On the
positive side, inflation is under control and
the commodity prices have softened. This
could help the industry in general to
50
improve its performance.
For the construction industry, the primary
drivers of growth remain healthy in many
areas. Business would grow steadily over
time, albeit at a slower pace. The three
important drivers are : (a) infrastructure
development; (b) capacity enhancement;
and (c) urbanisation. These growth drivers
are influenced by India's domestic demand
and the existing social and physical
'infrastructure deficit'. Construction
industry is cyclical by nature. The Indian
construction sector has been growing at
nearly 1.5 times the country's overall
growth. Considering the current conditions,
construction sector is expected to grow at
a slower rate of 9-11% in 2009-2010 as
against 17.5% in 2007-2008 and 16.3%
expected in 2008-2009.
Opportunities & Challenges
The construction market reflects a mixture
of optimism and apprehension. Owing to
lowering demand, some sectors like realty,
especially in premium housing and
capacity augmentation in manufacturing
sectors are expected to progress slower
than in the recent past. However with
continuous migration of people in to urban
areas, the housing sector will continue to
generate a lot of opportunities. Mass scale
affordable housing is one such opportunity
to be harnessed.
The infrastructure projects will continue to
get the focus from both Government and
private sectors, supported by policy
initiatives aimed at
infrastructure
development. This is corroborated by the
Planning Commission's
ambitious
investment plan on infrastructure over the
next 5 years in various sectors like power,
irrigation, roads, railways, ports and airports.
The construction sector, which accounts for
almost 60-65% of the capital spend, would
be the biggest beneficiary of these
investments.Transportation Infrastructure
(roads, bridges, elevated corridors, etc) is
expected to gain from favourable measures
taken by NHAI like transparent MCA (Model
Concession Agreements), increased VGF
(Viability Gap Funding) etc. In addition, the
state and district roads are also being taken
up for development. Metros and MRTS
(Mass Rapid Transport System) are
emerging as a major area of infrastructure
development in major urban centres. Urban
infrastructure like water supply, sanitation,
health care, waste management etc., are
expected to provide opportunity in the
year 2009-2010.
Increased budgetary allocation by the
Government for APDRP, NHDP, Accelerated
irrigation benefit programme, Jawaharlal
Nehru Urban Renewal Mission, Bharat
Nirman Programme etc., augur well for
business opportunities in related segments.
The increasing 'demand - supply' gap in the
Power sector and Government's continued
focus will drive the growth of the sector
which will boost order inflows for the Power
Transmission & Distribution, Bulk Material
Handling, Hydel and Nuclear business units.
On the international front, the GCC
countries have seen significant decline in
investment in realty sector. The investment
in the Oil sector is likely to be moderate due
to expectations of a drop in demand for oil
and the correction in its prices. Other
sectors, however, like power distribution
and infrastructure development in the Gulf
region is expected to continue to be robust.
Buildings & Factories Operating
Company (B&F OC)
B&F OC has continued its growth trend
during 2008-2009 by bagging large value
turnkey, design & build orders in airports,
IT parks, commercial space, health & leisure
structures & residential and factory
building segments. The progress made by
B&F OC during the year 2008-2009 towards
'Total Turnkey Solutions' was quite
significant. 'Concept to Commissioning' is
the theme driving the growth. This unique
capability along with focus on key account
management helps the B&F OC to retain its
customers.
Major contracts undertaken by B&F OC
including Delhi International Airport is
progressing on expected lines. Sensing the
realty slowdown ahead of time, B&F OC has
quickly diversified into Government
projects, affordable housing and new
airports outside
/ airport
modernisation projects in Tier II cities.
Healthy order book stands testimony to the
relentless business development initiatives,
giving the B&F OC visibility on the revenue
growth for the year 2009-2010.
India
Infrastructure Operating Company
(INFRA OC)
INFRA OC continues to maintain its
leadership position in construction of roads,
runways, bridges, metros, tunnels, hydel and
nuclear power plants. INFRA OC has
reported significant growth in the revenues
during 2008-2009 driven primarily by BOT
projects. During the year INFRA OC has
successfully completed several projects viz.
Runway in Delhi Airport, Road Packages in
Kattumavadi - Ramanathapuram and
Krishnagiri - Thopurghat sectors, Panipat
Elevated Corridor and Veligonda Dam.
to
largely due
renewed
Order inflow and order book have been
satisfactory
the
Government's
focus on
infrastructure as a tool to revive the
economic growth. Some of the major
projects bagged by INFRA OC include three
prestigious Gujarat State Road Packages,
Mumbai Monorail, Dam Project in Bhutan,
Irrigation project in Andhra Pradesh etc.
The atomic power plant at Tarapur, Unit 4. L&T is working closely with leading national agencies in helping the country meet its stated target of generating
20,000 MW of nuclear power by 2020 AD.
51
Metallurgical Material Handling and
Water Operating Company (MMHW
OC)
MMHW OC has sustained its success story
during the year 2008-2009. Order book
increased significantly with projects from
TATA Steel (Blast furnace and Sinter plant),
SAIL (Sinter plant, Rourkela), Vedanta
(Alumina plant, Hindustan Zinc Limited,
Debari, Utkal Alumina) etc. Time and again
MMHW OC has proven its execution
capabilities by completing the projects
ahead of time. MMHW OC is concurrently
executing six blast furnaces in the country
- a milestone event in Indian Steel plant
construction.
The Sector witnessed sharp volatility in the
commodity prices and thereby bringing
uncertainty in the capacity built up plans
in the near term. However, with the
continued thrust being given for water and
infrastructure development projects by the
Central/State Governments, MMHW OC is
expected to improve its performance.
Electrical & Gulf Projects Operating
Company (E&GP OC)
Power demand and supply gap drives the
business growth of E&GP OC. In addition,
India’s largest blast furnace (2.5 mtpa) built by L&T and Paul Wurth on an EPC basis at Jamshedpur. L&T
has constructed maximum number of blast furnace in the country. L&T carries out engineering,
procurement, manufacture, supply, construction and commissioning of projects in ferrous and non-
ferrous metals, mineral beneficiation, coal washeries and paper plants.
technological developments help
transmitting power over long distance with
minimum transmission losses. This has
given a fillip to HT Transmission Line
projects in the country. This OC is focusing
on substations, industrial electrification,
transmission line projects and railway
construction. E&GP OC has successfully
completed projects like Power Distribution
System - KAFCO, Kuwait, DIAL - AGL
package - Asia's longest runway (4430mtr),
400 KV for Jindal at Raipur substation,
220 KV GIS at Kudankulam for NPCIL etc.
Getting repeat orders from clients like
Power Grid
its project
testifies
management capabilities and timely
delivery.
E&GP OC has bagged a number of
breakthrough orders like construction of
Balance of Power Plants (BoP), 765 KV
substation, Power distribution package for
2.0 MTPA steel plant etc. With the
commissioning of expansion projects,
installed capacity of the Company’s
factories manufacturing Transmission Line
Tower, has reached 1,00,000 MT per annum.
Multi-storeyed commercial complex in Dubai’s prestigious Silicon Oasis. L&T has executed several
major projects in the GCC countries, including residential & commercial complexes, bridges, switchyards
and transmission lines.
52
The Gulf operations have shown significant
growth in revenues. L&T Oman, one of the
subsidiaries, has reported impressive
growth in the Buildings and Electrical
businesses. Key success factor for E&GP OC
continues to be efficient management of
working capital.
Power generation and distribution sector
continues to show promise within India and
in the Gulf region as the industrial and
domestic demand for power has been
steadily growing.
Significant Initiatives
Operating companies (OC) have been
made fully functional within the ECC
Division since July 2008. OCs are working
virtually like independent companies to
foster rapid scaling up of the business and
bring down the response time to customers
/ projects. To tide over the suboptimal
utilisation of resources triggered by current
economic scenario, measures have been
taken to focus on better accountability at
every level and ensure good governance.
A common forum to exchange the
knowledge across OCs is also under
implementation.
The Division envisages that the volatility in
the economy may result in under utilisation
of human
in pockets;
resources
consequently focus on multi-skilling / job
rotation will get a renewed attention to
minimise the effect. The Division's initiative
to train and retain workmen across India
has been strengthened by additional
budgetary allocation for building centres
in all the regions.
Outlook
Overall outlook for ECCD remains good
owing to its robust order book and
diversified business portfolio. The
Government's commitment to revitalise
the economy through renewed investment
in infrastructure, provides immense scope
and opportunities to the Division.
Increasing demand for power offers
substantial business opportunities for Bulk
Material Handling business. Government's
consistent support to augment water
supply and develop water network across
India, provides sizeable opportunities for
Water & Effluent Treatment SBU. Similarly,
Gulf region offers many water related
projects. The outlook of Minerals and
Metals business seems challenging for the
year 2009-2010. Special initiatives are being
taken for spreading our wings beyond
construction of blast furnaces / sinter plants
i.e towards pellet plant / compact strip
production (CSP) in ferrous sector and
copper smelting / alumina refinery in non-
ferrous sector. The Division is therefore
hopeful of capitalising on
these
opportunities to sustain the growth
momentum.
Artist’s impression of India’s first monorail system – being built by L&T in Mumbai. L&T’s Railway Business Unit integrates the Company’s capabilities and
provides comprehensive solutions in the rail sector. The focus is on urban mass transportation systems like monorails, metros and Light Rail Transport.
53
K. Venkataramanan
Whole-time Director & President
(Engineering & Construction Projects)
Process platform complex at Bombay High executed by L&T on an EPC basis for Oil & Natural Gas
Corporation. L&T provides turnkey solutions to the upstream hydrocarbon sector encompassing oil &
gas production, processing and transportation.
Engineering & Construction (Projects) Division
Overview
[E&C
Engineering & Construction (Projects)
Division
(Projects)] delivers
engineering, procurement & construction
in the oil & gas,
(EPC) solutions
petrochemicals, power and water sectors.
It provides single source responsibility for
execution of lump-sum turnkey projects in
multiple geographies. The expertise and
experience of E&C (Projects) Division arising
out of a successful track record in executing
projects, encompasses front-end design,
engineering,
project
management, procurement, construction,
installation and commissioning. These
integrated strengths are backed up by
flexibility of operation and agility in
response. A well institutionalised risk
management structure and high safety
standards are the other key strengths of the
division.
fabrication,
E&C (Projects) Division has consolidated its
presence in international markets. As part
of its mission to establish itself as a major
EPC player in the Middle East and South
East Asia, it has set up offices and built
manufacturing capabilities in select
countries. Joint ventures are set up with
54
renowned local partners in Saudi Arabia,
Kuwait, Oman, Qatar and United Arab
Emirates. The offices in Middle East are
backed up by a large engineering resource
base in India.
Some of the key inherent strengths that
enable the division to offer world class
solutions to its clients include:
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
Over 4500 qualified and experienced
personnel from various disciplines
Strong basic engineering capabilities
Large technology &
centers
innovation
State-of-the-art CAD facilities with
sophisticated plant design systems
Conformance to globally recognised
management systems standards
Open yard facilities for modular
fabrication with water front in India
and Oman
Business Environment
The global economic meltdown in 2008-
2009 led to the liquidity crisis, impacting
business conditions. Decline in growth rate
has resulted in a sharp contraction in
hydrocarbon, chemical & construction
industries.
The downturn caused a weak demand
situation and resulted in declining
commodity prices and cut down in
production. The decline in commodity
prices, however, showed disparate trends.
Fall in the price of steel did not result in
proportionate decline in the cost of
machinery and other equipment. Crude oil
prices saw a sharp decline from a peak of
$140 down to around $50+ per barrel. This
coupled with the credit squeeze forced
review of the project viability and
deferment / cancellation of investment
decisions, resulting in slower order inflows
during 2008-2009. Bidding for jobs in an
uncertain economic scenario was a
challenge by itself. Sharp swings in the
commodity prices and depreciation of
rupee further added to the uncertainties.
Some of the prospective clients sought to
reduce project costs through re-bids and
protracted pre-award negotiations on
price. Moreover, the contracting basis is
tending to change from LSTK to cost
reimbursable model due to volatility in the
material and execution costs. With size of
the contracts
increasing, the pre-
qualification criteria have become more
stringent and thereby delaying the take-off
phase of the project.
facing
is also
Tough competition from emerging EPC
players both in domestic and international
markets is a challenge to tackle in
Hydrocarbon Upstream and Mid &
Downstream businesses. The Power
formidable
busines
competition from established domestic
players and Chinese companies. The large
size of the envisaged power projects has
brought about additional challenges such
as accurate cost estimates, adherence to
demanding project schedules and financial
closure calendar. Lack of fuel sufficiency
and delays in implementation of reforms
have contributed to delays in finalising the
plans for power projects in the country.
The Division created three Operating
Companies under its umbrella during the
year, each for Hydrocarbon Upstream,
Hydrocarbon Mid & Downstream and
Power businesses to lay closer focus and
accelerate growth in the areas.
Gas compressor module (Size: 31m x 16m x 16m) being despatched from L&T’s Modular Fabrication
Facility at Hazira on India’s west coast.
Hydrocarbon Upstream Operating
Company
hydrocarbon
Hydrocarbon Upstream Operating
Company provides turnkey solutions in
sector
upstream
encompassing oil & gas production,
processing & transportation. The Company
has been successfully executing projects for
the last two decades in India, Gulf, Africa
and South East Asia for reputed clients. The
solutions offered are in a wide range of
products such as Process Platforms,
Wellhead Platforms, Submarine Pipelines,
Platform and Pipeline replacement,
Modules, Marine terminals and Floating
systems.
Decline in crude oil prices has affected the
viability of expansion plans and exploration
activities of the oil producing companies.
Domestic capex on development of new
fields continues to be modest as compared
to global trends. However, there is a
55
Naphtha Hydroteater Reformer Unit constructed by L&T at ENOC Processing Company LLC at Jabel Ali
Free Zone, Dubai , UAE.
Engineering USA,
engineering were strengthened though
formation of a joint venture with Gulf
the
Interstate
engineering capacities at Mumbai,
Vadodara and Faridabad centers were also
strengthened. The construction capacities
were augmented by adding strategic plant
& machinery resources. In the international
arena, the OC has set up a full-fledged
business unit at Sharjah to cater to
Middle East opportunities. Other
country specific JVs have been formed to
focus on specialised electro-mechanical
construction capabilities in the Gulf
countries.
Power Operating Company
L&T has taken initiatives in synergising its
internal strengths developed over decades
in the areas of project management,
engineering, manufacturing
and
construction by setting up an organisation
focused on opportunities in coal-based,
gas-based and nuclear power projects. This
business provides turnkey solutions for
setting up utility power plants, co-
generation & captive power plants on EPC
basis. It also provides power plant
engineering services through L&T-Sargent
& Lundy a joint venture between L&T and
Sargent & Lundy, USA. L&T has formed two
joint ventures with Mitsubishi Heavy
Industries, Japan for manufacturing
Supercritical Boilers and Turbine
Generators. During the year 2008-2009,
significant progress has been made in
setting up of these manufacturing facilities
at Hazira. Creation of facilities to
manufacture various power auxiliaries such
as boiler tubings, pressure pipes,
pulverising mills etc are also underway for
comprehensive offering of power
equipment to the customers. The coal
sourcing initiatives are being pursued
actively through L&T Natural Resources
Limited, a subsidiary company.
Power business is a major thrust area for
L&T from the long term perspective. The
Company is undertaking significant efforts
Group-3 Lube-based oil project executed by L&T on an EPC basis for Petronas Melaka Refinery in
Malaysia. L&T offers comprehensive services to the Refinery sector by undertaking EPC projects on
Lumpsum Turnkey basis in India and abroad.
renewed thrust in both redevelopment of
existing fields and
in deep water
exploration activities.
The Company has established a new state-
of-the-art fabrication facility for modular
structures, heavy jackets and oil rigs at
Sohar in the Sultanate of Oman. The yard
spread over 400,000 sq. m has facilities for
heavy structural fabrication, sophisticated
equipment, systems integration and testing
and load-out of ultra-large modules.
Significant progress has been achieved on
the capacity expansion plans at its existing
modular fabrication facility at Hazira in
Gujarat.
L&T-Valdel is the engineering arm of
Hydrocarbon Upstream OC, which provides
complete engineering solutions. It is
gearing up to cater to the growth needs
through its centers located at Faridabad,
New Delhi & Chennai and is also currently
positioning itself in UAE. The OC has set up
a joint venture with SapuraCrest Petroleum
Berhad of Malaysia to add to the installation
dimensions to its offshore capabilities
through owning & operating a Heavy Lift
cum Pipelay vessel, the LTS 3000.
In order to focus better on the marketing &
business development activities at the
56
international level, the OC has set up
development centers at:
1.
Abu Dhabi, primarily catering to
opportunities in GCC countries, Iran
and North Africa
2. Mumbai, to address opportunities in
South East Asia, Australia and West
Africa.
Hydrocarbon Mid & Downstream
Operating Company
Mid & Downstream business offers single
point EPC solutions in the field of
Hydrocarbon refining, Petrochemical,
Fertiliser and Chemicals Sector. The
business has to its credit several complex
projects executed successfully in domestic
and
international markets. The OC
addresses the entire spectrum of
opportunities in this sector which include
Green Fuel Projects, Fuel Upgradation,
Olefins, Polyolefins, Aromatics, Hydrogen,
Fertiliser, Gas processing, Reformers,
Cracking Furnaces, Cross Country Pipelines,
Gas gathering stations, Crude Oil terminals
etc.
During 2008-2009, Mid & Downsteam
business has taken a slew of initiatives to
improve its competitive positioning. While
the capabilities in the area of pipeline
and investments in this sector to leverage
on the business potential. Technology tie
ups, setting up of manufacturing facilities
& front end marketing structure, scaling up
manpower resources are the major
initiatives already underway in this regard.
Significant Initiatives
a) Risk Management
The Division has developed a robust risk
management framework. It has been
identified as one of the key enablers to
achieve the company's strategic objectives.
The E&C (Projects) Risk Management team
has been set up to effectively manage risk
that is inherent in the Engineering and
Construction business, namely costing,
scheduling, safety, financing, human capital
and contracting risk. It is an active member
of the Engineering & Construction Risk
Institute (ECRI) USA, an initiative of World
Economic Forum. The objective of this
initiative is to strengthen the competitive
edge and evolve a risk embracing culture.
Increased competition, pressures on cost
and deliveries, forex & commodity price
variations, impact of recessionary trends on
the award of jobs and manpower attrition
are some of the major risks faced by the
division. The Division has however adopted
risk mitigation steps right from pre-bid
stage covering technical, procurement and
financial risks. The measures such as
advanced quantitative tools, global
sourcing, standard operating procedures,
and operational excellence initiatives have
been implemented so as to protect the
profitability of the businesses.
b) HR for Professional Excellence
'Talent Management' has been a prime
mover in the company's ambitious business
plans. The HR strategy dovetails personal
growth aspirations of employees with
business needs. A variety of HR
interventions give the division a strong
competitive edge. A menu of career growth
options and training are offered to young
aspiring professionals for achieving
excellence in engineering and project
management skills. Setting up of L&T
Project Management Institute at Vadodara
complemented by the GLOPAT programme,
mentoring of new joinees, recognition of
excellence, strategy workshops and team
building programs are some important
initiatives undertaken during the year.
Outlook
India ranks sixth in the world with refining
capacity of 3.4 %. Just over 60% of the
potential in the oil sector has been explored
so far. In order to enhance energy security
of the country, the Government has
increased thrust on exploration which is
expected to lead to substantial investments
resulting in an increased activity in the
upstream sector. Improving oil prices will
encourage investments in new refineries
creating opportunities particularly for Mid
& Downstream sector in GCC countries.
New fertiliser policy for feedstock
conversion projects announced during
2008-2009, is seen to open up large
opportunities in the next couple of years.
The reform process as envisaged in
Electricity Act in the year 2007 progressed
during 2008-2009. The sharp increase in
demand for power has led to new
generation capacities, a significant portion
of which is planned through setting up of
Ultra Mega Power Projects based on super
critical technology. India has adopted a
blend of thermal, hydel and nuclear sources
with a view to increasing the availability of
electricity. Currently India needs to double
its generation capacity in next 7-10 years
to meet potential demand for power.
E&C Division is well geared up to harness
the upcoming business opportunities.
Clearly drawn out pre-bid strategies,
intense marketing efforts and enhanced
execution capabilities will drive the
performance. The division has also been
quick to roll out measures to mitigate the
adverse economic slowdown by taking
concrete steps in the areas of cost
reduction, improving productivity of
resources and operational excellence. These
initiatives are expected to be the
underpinnings of performance in the
coming years. In the backdrop of this
outlook E&C Division is optimistic of a good
performance in the year 2009-2010.
388.5 MW natural-gas-based combined cycle power plant at Vemagiri in Andhra Pradesh, South India.
L&T’s EPC capabilities extend across all types of power projects.
57
M. V. Kotwal
Whole-time Director &
Senior Executive Vice President
(Heavy Engineering)
Steam generators for Pressurized Heavy Water Reactors. L&T’s product range for the nuclear power
sector includes calandria, reactor roof slabs, Control Rod Drive Mechanisms and SS thermal insulation
panels.
Heavy Engineering Division
Heavy Engineering Division's operations
are managed through two Operating
Companies viz.:
(cid:2)
(cid:2)
Heavy Equipment & Systems
Operating Company
Shipbuilding Operating Company
Heavy Equipment & Systems
Operating Company (HES OC)
Overview
Heavy Engineering & Systems Operating
Company manufactures and supplies
custom designed and engineered critical
equipment and systems to the core sector
industries
like Fertilizer, Refinery,
Petrochemical, Chemical, Oil & Gas, Thermal
& Nuclear Power, Aerospace and Defence.
HES OC has manufacturing & fabrication
facilities at Mumbai in Maharashtra, Hazira
& Baroda in Gujarat and Visakhapatnam in
Andhra Pradesh. A Strategic Systems
Complex was commissioned during the
year at Talegaon in Maharashtra. A Precision
Manufacturing Facility at Coimbatore in
Tamilnadu has also been recently
commissioned.
A Strategic Electronics Centre for Defence
Electronics Systems design & engineering
operates from Bangalore in Karnataka.
Dedicated engineering centers support
manufacturing at all locations. The
Operating Company has set up three
"Technology Development Centers" at
Powai for new product development in
process plant equipment and for defence /
nuclear equipment as well as one focused
on electronics systems / sub-systems.
Business Environment
is mainly
The economic slowdown
impacting potential exports. Internationally
the refining business has been hit by the
fall in the crude oil prices and the general
economic slow down. Many planned green
field refineries and expansion projects have
been deferred or cancelled in USA, Canada
as well as in the Middle East. With fewer
projects on the anvil, the competition is
intense. However, Indian domestic refinery
projects are going ahead based on
mandates given by the Supreme Court. No
new petrochemical projects are being
planned, due to fall in demand for
petrochemicals.
HES OC, however, continues to see growth
opportunities, despite
the current
economic conditions. The recently
announced fertiliser policy by the
Government is favourable for investment.
Fertiliser sector offers good opportunities
both in the domestic market as well as in
the international markets like Middle East
& Africa. Coal Gasification business
continues to show promise in countries like
China & Vietnam in the short to medium
term. The Operating Company has achieved
a breakthrough by entering into the elite
league of manufacturers of Super-Critical
Power Plant Equipment.
The single major change in the Defence
Business environment during the past year,
was the announcement of the Defence
Procurement Procedure (DPP), 2008. The
environment is still not very supportive of
the private sector participation in defence
production. The decision to award "Raksha
Udyog Ratna" (RUR) status to select private
58
sector system integrators and allowing
"level playing field" continues to remain
pending for actions.
Offsets offer a potential growth area.
However, the Government needs to resolve
certain taxation issues. Supplies to the
defence services
including system
integration done under offsets in India
continue to attract various local taxes and
levies which discourage the foreign
defence contractor from awarding more
work as well as value added work in India.
HES OC is proud to be associated with the
Chandrayan mission for supply of critical
equipment & systems both for the Launch
segment as well as Ground / Command
control segment. The inking of the Indo-US,
Indo-French, Indo-Russian & Indo-Kazak
nuclear deals opens up new opportunities
for supply of critical nuclear power plant
equipment.
Significant Initiatives
The Operating Company has launched a
number of initiatives aimed at establishing
a leadership position in the global market.
The key initiatives are as follows:
Capacity Augmentation
HES OC has planned substantial capital
expenditure in line with its growth plans.
The Strategic Systems Complex for
assembly, integration and testing of
weapon systems, sensors and engineering
systems has started production at Talegaon.
The advanced composite facility for
Defence, Aerospace & Aviation products
has become fully operational during the
year at Ranoli complex, Baroda. A dedicated
facility for precision engineered products
was commissioned at Coimbatore during
the year under review. The Hazira heavy
fabrication facilities are being upgraded
and expanded. Dedicated sub-contractors
are being developed for further capacity
augmentation.
HES OC is setting up a heavy fabrication
facility through a joint venture in Oman to
cater mainly to the Middle East market. An
integrated Special Steel Melting Shop with
a heavy forging facility is proposed to be
set up at Hazira for catering to the
requirement of heavy forgings for nuclear
power plants as well as reactors for the
hydrocarbon market.
Capability Building
The Operating Company lays special
emphasis on continuous development /
adaptation of manufacturing technology,
modification of existing products and
development of new products through its
Technology Development Centers. The
Technology Development Centers have
built partnerships with DRDO / other
national laboratories and academia for joint
development work. A Warship & Submarine
Design Centre set up last year is being
strengthened for in-house design and
construction of naval vessels. A Virtual
Reality facility has also been commissioned
during the year.
to
significantly boost
A new initiative has been launched titled
"Enterprise-wide Collaboration
for
Alignment with Strategy" (ECAS), which
aims
the
preparedness of the organisation to meet
new challenges. A new Customer Intimacy
Strategy along with promotion of
"Collaborative Culture" across functions has
been adopted with the primary aim of
providing best service to the customer.
Improvement Initiatives
The "Product Lifecycle Management" (PLM)
project went live across the Operating
Company's various locations during the
year. The PLM project will help improve
knowledge management, reduce cycle
time and improve collaborative working
across functions. Automation of design and
drafting work using knowledge based
engineering tools is helping in knowledge
management and cycle time reduction in
engineering in a big way.
Lift-off of India’s prestigious space vehicle, Chandrayaan I. L&T provided specialised launch and
tracking systems for this moon mission. L&T’s precision manufacturing facilities are geared to meet the
exacting demands of aerospace manufacture.
A number of teams are working on various
improvement projects under the umbrella
59
Methylamine converter for Chemanol-MA/DF plant, Al-Jubail, Saudi Arabia.
of the "Operational Excellence" theme. The
Operating Company relies on the "Critical
Chain Project Management" methodology
of the "Theory of Constraints" for managing
planning & execution of projects and for
improving its delivery performance. The
Operating Company follows a structured
process for protection of its Intellectual
Property Rights. During 2009-2010, the
Operating Company received four patents.
Shipbuilding Operating Company
(SHBD OC)
Ship Building Operating Company is in the
business of construction/repair of both
commercial & defence vessels. The
Operating Company presently has design,
fabrication & shipbuilding facilities at
Hazira in Gujarat, which handles the
construction of commercial vessels.
Construction of a new shipyard has been
launched at Kattupalli in Tamilnadu. The
new shipyard will primarily focus on
construction / refits of naval ships &
submarines and repair of commercial
vessels.
Business Environment
The international shipbuilding market is
presently going through a difficult phase
marked by low freight rates & the global
financial crisis leading to a global slowdown
in commercial ship building. Fleet owners
have deferred their plans for acquisition of
new vessels. Though the major shipbuilding
yards in China & Korea are still booked with
orders till 2011, they have slots freed up due
to cancellations in the bulkers segment.
The Government of India has agreed to
grant shipbuilding subsidy to all eligible
vessel orders booked prior to August 14,
2007. The Shipbuilders association of India
is working closely with the Government for
continuation of the subsidy scheme to
enable them compete with Chinese &
Korean yards.
Significant Initiatives
Augmentation of facilities & resources at
Hazira is under way to meet the present and
future growth needs. The Operating
Company is focusing on streamlining its
internal systems and processes for
strengthening the operations.
Services of internationally acclaimed
consultants are being availed
for
construction of state-of-the-art facilities at
the new ship yard planned at Kattupalli.
Outlook
There are early signs of a turnaround. The
economic situation world over is likely to
improve by end 2009, early 2010. Fertilizer
sector
is expected to offer good
opportunities with a few green and brown
field investments both in the domestic
market as well as in the international
market. The division expects good
prospects from domestic refinery projects.
Deferred projects in the Middle East are
likely to revive in the third quarter of the
current year. New territories like Iran hold
good potential.
With the signing of the Indo-US nuclear
deal and India signing the IAEA safe guard
agreement, there are good opportunities
60
for supply of nuclear power plant
equipment in the medium to long term. The
new Government is expected to hasten the
decision making process for new defence
contracts and take measures to liberalise
the sector.
Indian Navy
With the international shipbuilding
industry being severely affected by the
financial meltdown, the order pipeline has
is
been thinning. The
committed to develop indigenous design
and globally competitive construction
capabilities for naval vessels. The Operating
Company is well poised to harness this
potential demand through the new ship
yard under construction at Kattupalli.
Overall, both the Operating Companies
envisage good market opportunities in the
medium term.
Reactor vessel for Fast Breeder Reactor (FBR) being lowered into a vault. The mirror-polished thermal
insulation panel increases the effectiveness of the vessel. L&T is at the forefront of India’s FBR
programme.
Reactors set sail for Malaysia’s Maleka Refinery. L&T designs and manufactures sophisticated equipment of large dimensions at its state-of-the-art
manufacturing facilities in Hazira near the Arabian Sea. L&T is setting up additional manufacturing facilities at Sohar in Oman.
61
R. N. Mukhija
Whole-time Director & President
(Electricals & Electronics)
Representative section of L&T’s wide range of switchgear. In addition to low-tension switchgear
(featured here), L&T offers medium-voltage switchgear, building electricals and energy meters. The
range encompasses integrated automation and complete electrical solutions.
Electrical Business Group (EBG)
Overview
The Electrical & Electronics Division (EBG)
comprises Electrical and Automation
Operating Company (EAOC) and two stand-
alone business units of Medical Equipment
& Systems
(MED) and Petroleum
Dispensing Pumps & Systems (PDP).
Four Strategic Business Units (SBUs) -
Electrical Standard Products (ESP), Electrical
Systems & Equipment (ESE), Metering &
Protection Systems (MPS) and Control &
Automation (C&A) are under the umbrella
of EAOC. ESP and ESE have the production
base in Powai, Mumbai and at Ahmednagar
in Maharashtra, with additional facilities for
ESE and a Precision Manufacturing Centre
for tooling solutions at Coimbatore in Tamil
Nadu. Control & Automation business unit
operates from its "Automation Campus" in
Navi Mumbai, while Metering & Protection
Systems is based at Mysore in Karnataka.
EAOC has international presence through
manufacturing facilities in Wuxi (China) for
Switchgear Standard Products, at Dammam
in Saudi Arabia for switchboard and for
Control & Automation in Jebel Ali, UAE. It
62
has increased its international presence
with the acquisition of switchgear business
of TAMCO Corporate Holding of Malaysia
last year, winning access
its
manufacturing facilities and markets in
Malaysia, Indonesia, Australia and China.
to
Business Environment
Owing to the global economic events of
Sept-Oct 2008, performance was adversely
impacted either with business slowing
down or getting postponed in several
industry sectors like cement, metal etc. The
pressures to re-negotiate contracts were
experienced, as most of the customers went
through the phase of falling profits and
surplus capacities.
The commercial and residential building
projects were the worst hit, as also the
traditionally stronghold sectors like,
cement and steel. However, business
segments in power and infrastructure
domains, viz. Balance of Plant (BoP), R-
APDRP, Power Plant DCS and BMS/EMS
continued to show good potential.
Investments in infrastructure sector such as
metro rail, monorail, ports, airports etc. hold
promise. No major expansion is evident in
oil & gas sector. The reduced level of
enquiries led to more intense competition
at the market place. Existing players
increased their manufacturing capacities
putting pressure to book more business
causing price pressure. There is a slowdown
in petroleum retail network investments
which will reduce off-take of dispensers.
With controlled price regime still in place,
fuel retailing by private oil companies has
become unattractive. For Medical
Equipment Systems, the industry has
grown and this growth is expected to
continue in the Indian market. Entry of
Chinese manufacturers through the
distribution chanels at low prices for
monitors and ultrasound equipment is the
major challenge to Medical business.
On the international front, oil & gas projects
& power sector outlays sustain the
prospects pipeline.
Significant Initiatives
The Customer Interaction Centre (CIC) went
live in the year 2008-2009. This new
initiative helped the businesses to respond
The Control & Automation business has set
up a Technology Centre to nurture the
ongoing technologies & look forward to
new upcoming cutting edge technologies
to be used for Automation EPC projects.
New design meters have been introduced
and efforts are underway for providing
automatic meter reading (AMR) solutions.
New Product Development
Development of new products and
technologies continues to be top priority
for the division. It plans to meet market
expectations and keep pace with
competition by introducing new products,
with specific focus on cost effective
offerings. In the year 2009-2010, ESP will be
launching 'right price' product variants in
Moulded Case Circuit Breakers and
Contactors. The U-Power range of ACBs will
be upgraded. There will be focus on
development of Automation Solutions for
buildings and Energy Management
Systems.
The Control and Automation business unit
is developing Toll Management System,
which will be a state-of-the-art Toll
L&T’s custom-engineered switchboards, equipped with both conventional and ‘intelligent’ protection,
control and communication systems meet the power control and distribution needs of industry.
for MV products in India. Also there are
plans for a franchisee network for new
design LV flat pack products for Gulf
market.
faster and free the sales team from
attending general queries. EBG has initiated
a division-wide awareness to focus on the
3 Cs - cost, cash and customer. The
highlights of this initiative are working
capital measures taken such as aligning
deliveries with the end users cash flow, and
emphasis on outstanding collections.
Initiatives for operational excellence such
as 5S, Six Sigma and Value Engineering
continue with upto 75% increase in these
projects.
For switchgear products, a new initiative to
tap the retail market for the electrical
products was started. The focus is to enlarge
reach, presence and visibility in the retail
market through appointment of a large
number of dealers as channel partners
under this programme. A new partnership
programme was initiated to provide
automation solutions to industrial and
building segment customers.
After the acquisition of TAMCO there is a
focus on growth in MV segment. EAOC is
looking for setting up franchisee network
Medium voltage switchgear, made at L&T’s Tamco facility, has been widely installed in industries
around the world. L&T offers custom-engineered switchboards – equipped with both conventional and
intelligent protection, control and communication systems – to meet the power control and distribution
needs of industry.
63
Management System including electronic
toll collection for national & state highways.
A Terminal Automation System for
Integrated Terminal Automation & Tank
Farm Management System for petroleum
products are also under development.
MPS is planning to replace the existing
designs of tri-vector meter with new cost
effective designs. Also development is on
for meters for select international markets,
GPRS modem for data communication,
meters with radio communication facility.
R-APDRP initiative may require installation
of open protocol in meters and will also
require all meters to be communicable over
various wired and wireless media, which are
on the anvil.
Medical Equipment and Systems business
unit had launched a new product range in
Patient Monitoring under 55 series, which
has been accepted well in the domestic and
USA market. A new set of multi-parameter
monitors are being developed to cater to
the cost conscious lower end segments.
PDP has developed a new electronics
platform (4GDE) for its dispensing pumps.
Intellectual Property Rights (IPR)
The division has put conscious efforts to
generate innovative ideas and create value
for the organization by protecting them
through intellectual property rights. In
2008-2009, EBG has filed 108 patent
applications, 33 design registration, 5
trademarks filings and 6 copyrights filings.
The IPR approach also ensures that no
product infringes on any competitors'
products unknowingly. The division has
been focused on directing its innovation
energy towards improved manufacturing
processes & cost control. It is ensuring
continuous alignment of business interests
& IPR creation by way of Gate Processes of
approvals according to EBG's Product
Development System (EPDS).
Outlook
The Government's ambitious UMPP
projects will be under implementation
64
Supervisory Control And Data Acquisition system designed, supplied and commissioned by L&T for
Onshore Control Centres (OCCs) for offshore operations of Oil & Natural Gas Corporation. The system
connects 133 wellhead platforms, 13 process complexes and nine drilling rigs to OCC.
during the year 2009-2010. It has also
sanctioned Rs. 1477 crore in the interim
budget for R-APDRP
initiative. The
Government
initiative on highway
development programme will open good
business opportunities. With
the
investments in ports, airports, metro &
monorail projects, infrastructure sector is
also expected to grow. Apart from power
generation and infrastructure sector, all
other sectors are showing marginal or
negative growth.
A positive outcome of the economic down-
turn is that customers are moving from
products sourcing to project sourcing
thereby bundling the related products in
one package . This trend will enhance the
competitive position of the division, as it
will leverage upon the Company's project
management skills.
The Division is hopeful of positive
developments leading to improvement in
the demand in the latter half of the financial
year 2009-2010.
L&T’s range of electronic energy meters and numerical relays.
J. P. Nayak
Whole-time Director & President
(Machinery & Industrial Products)
L&T-Komatsu PC130-7 Hydraulic Excavator being employed for canal excavation at an Irrigation
project. L&T markets Construction and Mining equipment manufactured within India by L&T-Komatsu
Limited as well as machines supplied by Komatsu Limited.
Machinery & Industrial Products Division
Overview
Machinery and Industrial Products Division
(MIPD) comprises Industrial Products &
Machinery Operating Company (IPM OC)
and Construction Equipment Business
Sector (CEBS).
Industrial Products & Machinery
Operating Company (IPM OC):
In order to address the comprehensive
needs of the common customers in
industrial sector, the Division has
aggregated its industrial products and
machinery businesses under the IPM
Operating Company. IPM OC has two
distinct business streams - Industrial
Products and Industrial Machinery.
Industrial Products:
A.
Valves Business Unit (VBU):
VBU markets valves and allied products
manufactured by the L&T's JVs; viz. Audco
India Limited (AIL), Larsen & Toubro
(Jiangsu) Valve Company Limited, China,
and a few Indian & overseas manufacturers.
VBU is one of the few select suppliers of
valves for global oil majors.
Besides, the JV manufacturing facilities, VBU
also has set up its own facility "Fluid Control
Products Centre" (FCPC) at Coimbatore,
which provides the technology support for
new product development as well as
contract manufacturing of valves in ranges
not fully supported by AIL. The FCPC is also
setting up a new plant for manufacture of
valves to support L&T's foray in the Power
Sector.
Welding Products Business (WPB):
WPB markets products manufactured by
EWAC Alloys Limited, along with imported
inverter based welding machines from
Fronius, Austria, and Oxy-Fuel equipment
from Messer, Germany. WPB also sells locally
indigenously developed MIG welding
machine and inverter welding machines. To
provide comprehensive solutions to its
major clients in the welding technology,
WPB also provides repair & maintenance of
critical industrial components.
Industrial Cutting Tools (INP)
Business:
INP business provides metal cutting
solutions to the Indian manufacturing
industry, covering automobile and machine
tool segments through marketing of
industrial cutting tools manufactured by
ISCAR Limited, Israel.
Industrial Machinery:
B.
Kansbahal Works (KBL):
Machinery for Pulp & Paper, Mining, Mineral
Processing and Steel industries, as well as
components for Wind Turbines are
manufactured and marketed by Kansbahal
Works. Its Foundry also manufactures large
wear and abrasion resistant castings for
power and cement sectors.
LTM Business Unit (LTMBU):
LTMBU manufactures and markets rubber
processing machinery for the tyre industry.
Currently, the unit has manufacturing
facilities at Manapakkam, Chennai and at
Kancheepuram near to Chennai. LTMBU
also markets plastic injection moulding
machines manufactured by L&T-Demag
Plastics Machinery Limited. LTM has been
ranked No.11 amongst "top suppliers of
tyre and rubber machinery around the
world" by European Rubber Journal, for the
year 2009. L&T-Demag Plastics Machinery's
products find applications in diverse
industries like automobiles, electrical
goods, packaging, personal care products,
writing instruments and white goods.
65
Construction Equipment Business
Sector (CEBS)
Construction Equipment Business Sector
(CEBS) markets and renders support for
Construction & Mining Equipment. The
Sector comprises following business units:
(cid:2)
(cid:2)
(cid:2)
(cid:2)
Construction & Mining Business Unit
(CMB) which markets equipment
manufactured by L&T-Komatsu
Limited, India and the entire range of
equipment available from Komatsu
worldwide. It also markets Mining
Tipper Tricks available from Scania.
L&T-Komatsu Limited (LTK) - the 50:50
JV with Komatsu that manufactures
Hydraulic Excavators and Hydraulic
Components, all of which are
distributed in India by CMB;
L&T-Case Equipment Private Limited
(LTCEPL), the 50:50 JV with CNH Global
n.v., which manufactures and markets
Backhoe Loaders and Vibratory
Compactors;
Tractor Engineers Limited (TENGL), the
100% wholly-owned subsidiary, which
manufactures
and markets
Undercarriage Systems for excavators
and Material Handling Systems like
apron conveyors etc
Business Environment
rise
The current economic downturn which
started in last year has cast its influence on
the industrial sector in general and on the
business sectors that MIPD operates in
particular. The first half of the financial year
witnessed unprecedented
in
commodity prices adversely affecting input
costs of most industries. On the other hand,
the sharp fall in economic activity globally
and the fall in price of crude oil, led to a
postponement of investment by the major
clients. With surplus capacity among
manufacturers, the competitive intensity
has increased particularly in the global
market.
66
Many projects in cement, steel & paper
sectors are on hold or have been dropped
due to the global financial crisis. Also, minor
revisions in Wind Energy Policy in some
states like Tamil Nadu has brought down
the growth rate in the sector from 25% last
year to 15%. The last quarter of the year
2008-2009 saw a downturn of automobile
industry which had a cascading effect on
the performance of tyre industry and tyre
machinery manufacturers.
The performance of the construction
equipment industry also reflected these
pains. After a moderate slowdown in
growth rates from the past three year highs
of 45-60% to about 22%, the demand fell
by 50-65% in the third quarter of the
financial year.
Significant Initiatives:
The Division has set up War Rooms to
combat effects of the severe downturn in
the demand for products. Production and
procurement plans have been quickly
reviewed and adjusted to fit the volatile
demand. Special focus groups have been
constituted to expedite collections, reduce
inventories and conserve cash. Tracking and
monitoring measures have been put in
place and reviews are carried out closely at
various levels in the sector.
Specific initiatives being undertaken by the
respective sectors is given below:
I.
(cid:2)
(cid:2)
IPM OC
The project for setting up 25000 TPA
green field foundry in Coimbatore to
manufacture cast components for
wind turbine is progressing as per the
plan and is expected to go into
commercial production in the 3rd
quarter of 2009-2010.
strengthen
Additional approvals from major end-
users were secured for LTJVCL valves
in China. To
the
international marketing network
personnel have been posted in key
growing markets such as China and
Middle East.
(cid:2)
New products have been introduced
which will help in building the
L&T-CASE 770 loader-backhoe engaged in a land-development project. L&T-CASE is a JV of Larsen &
Toubro Limited and CNH, a global leader in manufacture of loader-backhoes.
including projects under execution. With
the implementation of the UMPP projects
in India, requirement for industrial valves is
expected to boost the demand in the
coming year. The nuclear power program
also offers large scope for the valves
business. L&T's strategic alliance with some
of the key nuclear power majors will help
in building this market segment.
Due to the capacities built up in the last 2-
3 years, coupled with the liquidity
constraints, demand for machinery for steel
and other mineral process industries is
expected to be lower than last year. The
outlook for wind mill castings is however
positive as there is a backlog of orders and
the new foundry facility in Coimbatore
would be operational in the coming year.
As per the latest reports from tyre majors
like Pirelli, the global demand for tyres is
expected to be lower in the coming year. In
view of the current downturn, the domestic
tyre industry is focusing only on two and
three wheeler tyres, truck radial & OTR tyres.
The business for the Plastic Injection
Moulding machines will also improve only
by the end of the year 2009.
The market demand for construction
equipment is expected to remain sluggish
Tyre Building machine equipped with state-of-
the-art features for building car / light truck
radial tyres, for a leading tyre company in India.
The machine is part of the wide range of rubber-
processing machines manufactured by L&T.
competitive advantage and market
share.
(cid:2) Most business units in IPM OC have
initiated significant steps for close
monitoring to ensure reduction in
working capital and in particular,
customer receivables.
II. CMB
(cid:2)
(cid:2)
New imported models of Hydraulic
Excavators, viz. PC800, PC210-8,
sourced from Komatsu, have been
introduced in the Indian market to
improve product offerings to the
customers.
After-sales support capability is
expanded through long term full
maintenance contracts and site
support agreements for the products
to help improve machine uptime and
capping operating costs thus helping
their
customers
competitive position.
improving
in
Outlook
The oil prices over the last few months have
stabilized and a number of projects in the
upstream sector particularly in the Middle
East are slated to proceed. However, in the
Refining segment, there is a significant
slowdown in international projects,
Industrial valves manufactured by JVs, Audco
India Limited and Larsen & Toubro (Jiangsu)
Valve Company Limited.
Innovative Solutions for Welding, Cutting & Wear
Protection of Metal Components
on account of the downturn in the urban
infrastructure and general construction
sectors and reduced spending by the
Government on various infrastructure
projects. Post parliamentary elections and
monsoons, it is expected that there will be
an improvement in infrastructure building
activities by the Government as well as a
in market
general
confidence.
improvement
Gap between coal demand and supply of
around 40 million tones continues to
provide a growing opportunity for mining
equipment. CMB is well placed to take
advantage of these opportunities. Backhoe
Loader and Vibratory Compactor markets
are witnessing slight recovery as compared
to substantial decline in the year 2008-2009.
Still it is expected that the market for
Backhoe Loader may remain bearish,
though Vibratory Compactor market may
witness marginal growth in view of large
planned investments in Road Sector.
The domestic economic environment is
largely dependent on the domestic policy
framework as well as the stability in the
financial market. Considering the good
track record of the economy in the recent
past, the Division is quite optimistic of
positive developments emerging from the
third quarter of the year 2009-2010.
67
V. K. Magapu
Whole-time Director &
Senior Executive Vice President
(IT & Technology Services)
Technology Services
Overview
Carrying the brand and the legacy of Larsen
and Toubro group of companies, L&T
Technology Services has been rated the
no. 1 engineering services provider in the
World 2008 Black Book
of Outsourcing. The
Division
comprises
Integrated Engineering
Services (IES, earlier
named as e-Engineering
Services) and Embedded Systems (EmSyS)
business units. The Division provides a
range of IT enabled engineering services
and systems required in the design and
execution of turnkey projects and
equipment / product development.
Integrated Engineering Services
(IES)
The IES, headquartered at Vadodara,
Gujarat, has established its design centers
spanning the cities of Bangalore, Chennai,
Mysore, and Mumbai. It has about 3000
employees delivering high-quality
engineering and design solutions. The end-
to-end services basket comprise product
68
Headquarters of L&T Infotech at Powai, Mumbai.
design, analysis, proto-typing & testing,
embedded system design, production
engineering, plant engineering, buildings &
factories design, asset
information
management & sourcing support using
cutting-edge CAD/CAM/CAE technology.
IES predominately renders its cutting-edge
services to high end verticals such as
Automotive, Aerospace, Marine, Off-
highway Machinery, Industrial Products,
Consumer
Goods,
Pharmaceuticals, Minerals & Metals, Oil &
Gas and Utilities sectors.
Packaged
Embedded Systems (EmSyS)
EmSyS provides embedded systems for
electronics product design
and
development. The solutions comprise
supply of hardware, application software
and enclosure design for the system largely
required
in Automotive, Medical,
Semiconductor and Industrial products
segment. The business unit has a dedicated
team of more than 1000 professionals
operating from Mysore, Bangalore and
Mumbai.
India is poised for a very big leap in the
in
'Product Development' market. EmSyS with
expertise
'product development'
combined with its experience in 'electronic
product manufacturing' is in a very good
position to take a big share of this. It is
serving its customers in complete Product
development, consultancy as well as
various components of the Life Cycle such
as
Sustenance-
engineering, VAVE and obsolescence
management.
Re-engineering,
Business Environment
The evolution of the Engineering Services
market has been significant over the past
few years. The current trend in outsourcing
space shows a larger share of IT enabled
engineering services ranging
from
complete product design, complex turnkey
project design, value analysis/cost
reduction projects, design of assembly lines,
fixtures etc. In the next two or three years,
the trend is expected to accelerate and
accordingly engineering services industry
would need to position itself for delivering
the bench marked services for driving
innovation and continuous cost reduction
for its global clients.
Significant initiatives
IES has taken special measures to re-
organize its sales reach by increased focus
on India & Europe in addition to emerging
regions like Middle East and Asia Pacific. The
business unit has also achieved CMMI Level
5 certification to offer quality deliverables
to the customers. IES has taken important
steps to increase resource utilization &
reduce operational cost so as to deliver
value to the customers.
EmSyS was the first business unit in the
world to achieve SEI CMMI® Level 5 using
all the four components. "Continuous
improvement" programs and "Six-Sigma"
initiatives in EmSyS are giving thrust to its
"Quality Movement". It continues to
generate and pass on many 'Patentable
ideas' to its customers. EmSyS serves many
small as well as Fortune 500 companies.
Outlook
The economic recession, along with the
tightening of outsourcing norms, has
dented the growth of all sectors in the
current year. However, even in such a
difficult environment, L&T Technology
Services has fared better than most of its
peers because of a healthy exposure to
diverse sectors and a client portfolio of
industry leaders. Moreover, with the
economic slump expected to ease out by
the end of this year, the demand for
engineering services outsourcing would
experience a significant upturn.
Talent drawn from premier academic institutions
plays a pivotal role in L&T Infotech’s successful
implementation of the key business and
technology needs of its client base.
Design Centre for Embedded Systems at Mysore. L&T offers design solutions in the areas of hardware, software, product development….
69
Y. M. Deosthalee
Whole-time Director &
Chief Financial Officer
Financial Performance for 2008-2009:
An analytical review
L&T Standalone:
I. GROWTH IN AN EXTREMELY CHALLENGING
ENVIRONMENT
The Company has reaffirmed its conviction in the sustained
growth potential of its various businesses by reporting a
healthy financial performance for the year 2008-2009,
despite the perilous impact of a global slowdown. While
the Company's product businesses had to bear some
adverse impact of the downturn, its project businesses
improved their performance over the previous year, even
in the face of highly demanding circumstances.
The Company secured fresh orders during the year totaling
to Rs. 51,621 crore, recording a healthy growth of 23%
over the previous year. The growth in order inflow would
have been still higher, but for the deferment of a few major
orders in the Hydrocarbon and Process industries. The
share of order inflow from the Infrastructure & Power sectors
increased during the year reflecting the Company's growing
stature in the nation's infrastructure-building. The flow of
orders witnessed during the year 2008-2009, as reflected
in its sizeable order book, is expected to give a fair amount
of confidence to the Company's revenue growth plans in
the year that has just commenced.
Gross sales & services at Rs. 34,045 crore grew by 35%
over the previous year, with a share of 82% from
70
Engineering & Construction businesses. International
revenues increased to 19% establishing the Company's
growing presence in the overseas markets.
Order book of the Company as at March 31, 2009 at
Rs.70,319 crore grew by 33%. In the Engineering &
Construction Segment, orders over Rs. 300 crore each
under execution, account for 70% of the segment's order
book, signifying a strategic shift in selection of orders
towards relatively larger size projects, to ensure optimum
utilisation of the available resources and the management
bandwidth.
Manufacturing, Construction & Operating Expenses
The Company incurred Rs.26,232 crore under
Manufacturing, construction & operating expense category.
This translates into 78% of net sales reflecting a marginal
increase by 1% point, as compared to the previous year.
Major part of the financial year 2008-2009 witnessed
increase in commodity and input prices. While this increase
was covered under contractual escalations for E&C Orders
to a large extent, competitive forces prevented the product
businesses from passing on the higher input costs to the
market through higher price realisation. Improved execution
and manufacturing efficiencies helped the businesses
partially mitigate the impact of higher input costs and lower
growth in volumes.
Keeping in mind the long term growth ambitions of its
businesses, the Company during the year effected a net
addition of 5,416 employees, taking its manpower strength
to 37,357. Staff expenses at Rs.1,998 crore for the year
were higher by 30% over the previous year due to this
manpower addition as also the effect of increase in salaries
& wages. However, staff expenses as a percentage of total
income have reduced from 6% in the previous year to 5.8%
in the year 2008-2009.
Sales, administration and other expenses for the year at
Rs.1,840 crore have increased by 36% as compared to
the previous year. However, as a percentage of total
income, the expenses have remained at 5.3%. Benefit of
scale of operations, sharing of common resources and
tighter control on elements of fixed costs have enabled the
Company contain this category of expenses.
Sustained Profitability of Core Businesses
The Company's Engineering and Construction Segment
has not only sustained their profitability but has also been
able to show some marginal improvement in the operating
margins during the year under review. This improved
performance has, however, been offset by a drop in
operating margins of its product businesses due to lower
capacity utilisation and higher input costs, as compared to
the previous year. Overall the Company's profit before
71
exceptional items registered a healthy growth of 29% to
Rs. 2,709 crore, as compared to the previous year.
The Company successfully concluded a deal disposing of
its Ready-mix Concrete business during the year, which
generated an extraordinary gain of Rs. 959 crore net of
tax. Further, the Company made an investment in shares
of Satyam Computers & Services Limited (SCSL) through
its wholly-owned subsidiary, L&T Capital Company Limited,
as well as on its own Balance Sheet. Though the Company
believes in the long-term value proposition of this
investment, it has made a provision of Rs.186 crore towards
the extraordinary decline in the value of SCSL shares,
based on the principle of "prudence". Including the effects
of the said extraordinary items, the Company's PAT rose
by 60% to Rs. 3,482 crore. The Earning per Share (EPS)
for the year accordingly has increased by 57% to Rs. 59.50
per share, post-allotment of Bonus Shares in the ratio of
1:1.
depreciation, interest & tax, excluding other income
(operating PBDIT), at Rs. 3,857 crore has increased by
30% over the previous year. Operating PBDIT at 11.5% of
net sales, however, stands marginally reduced by 40 basis
points as compared to the previous year, due to reduced
profitability of product segments and an exchange loss
incurred on foreign currency loans before the same were
hedged.
Other Income
The Company has astutely managed its portfolio of
investments so as to maximise the returns from surplus
funds in a highly volatile capital and money markets. The
surplus cash available from the internal accruals,
borrowings and the sale proceeds from divestment of
Ready Mix Concrete (RMC) business, was timely deployed
to earn an pre-tax yield of over 14%.
Finance Cost
The relatively higher interest expense for the year at Rs. 350
crore is attributable to additional average borrowing of Rs.
2,240 crore during the year to finance the growth needs of
the Group, as also increased cost of borrowing. The
Company has drawn up ambitious plans for its emerging
businesses in Financial Services, Property Development,
Port & Shipyard and Power Equipment manufacture
through its subsidiary companies and JVs. Besides, its
project & product businesses have also been growing
rapidly at a compounded growth rate of over 30%, requiring
higher funds for working capital and capital expenditure
needs.
Interest rates in the domestic financial market hardened
due to the global financial crisis and constrained credit flow
to the corporate sector. However, the average cost of
borrowings could be contained at 6.9% for the year, through
higher proportion of foreign currency borrowings. A major
part of such foreign currency borrowings stands hedged
against currency and interest rate risks.
Overall Profitability
Profit before tax excluding extraordinary and exceptional
items for the year 2008-2009 at Rs. 3,940 crore registered
a growth of 28% over the like amount of previous year. In
line with the growth in profits, the income tax provision
increased by 29% to Rs. 1,177 crore. However, the effective
tax rate is still lower at 30% of the book profits. Fringe
Benefit Tax has reduced by Rs. 16 crore due to lower market
price of the options under the Employee Stock Options
Scheme. Profit after tax (PAT) excluding extraordinary and
72
Funds Employed
Working capital in the business segments increased during
the year, mainly due to lower flow of customer advances in
case of project orders, aggravated by poor availability of
funds in the system. Gross & net working capital deployed
by the segments marginally increased to 44% & 12% of
sales respectively as at the year end. Net customer
receivables at Rs.10,056 crore reflect 108 days of sales
(DOS), almost at the previous year's level. The businesses
were successful in settling some of the old disputes with
their customers and collecting the overdue receivables,
thereby bringing down the DOS.
during the year. Higher net working capital and capital
expenditure contributed to the increase in segment funds
employed by Rs. 2,566 crore.
At the Company level, investments in Subsidiary &
Associate Companies increased by Rs. 2,170 crore to build
capabilities for the emerging opportunities in the Financial
Services, Power equipment, Property Development &
Medium Voltage Electrical businesses. Considering
increase in other corporate assets, loans, advances and
investments of surplus funds, amounting to a total of
Rs.1,128 crore, the net funds employed for the Company
increased by Rs.5,864 crore over the previous year.
Excluding the extraordinary and exceptional items, return
on net worth & return on capital employed stood at 24.7%
& 17.6% respectively. EVA for the year at the Company
level continues to be positive at Rs. 733 crore. The relative
reduction in RONW, ROCE and EVA as compared to the
previous year, is attributable to the additional funds
The capital expenditure of the business segments
amounted around Rs. 1,900 crore during the year. The
major expenditure was incurred as part of the on-going
expansion plans at Hazira, Coimbatore, Ahmednagar &
Talegaon, besides on beefing up the construction plant and
machinery for execution of mega turnkey projects bagged
73
deployed in the emerging businesses and expansion plans
of the Group that are yet to see full scale revenue and
profit generation.
Sound Financial Health
Despite the tight liquidity condition prevailing in the market,
the businesses could succeed in generating an operating
cash-flow of Rs.1,479 crore through a close monitoring of
working capital. The divestment of Ready Mix Concrete
business boosted the Company's cash position by Rs.1,121
crore net of tax. Further, the Company resorted to additional
borrowings to the tune of Rs.2,558 crore during the year,
at competitive interest rates from both domestic and
international markets. This helped the Company continue
with its capacity build-up plan, investments on its new
business initiatives and provide the much needed working
capital to its growing businesses.
Refineries sectors, many of which were exceeding Rs.1,000
crore in values. Due to crude oil prices bottoming out during
the later part of the year, the pace of infrastructural
development in Gulf slowed down to some extent and
adversely impacted the flow of orders from that region. This
led to the share of international orders reducing to 14.5%
of the total segment order inflow during the year.
Backed by a healthy opening order book and a good order
inflow during the year, gross revenue increased by 47%.
The segment's order book as on March 31, 2009 stood at
Rs.68,753 crore, giving a good visibility for next year's
revenue growth. Segment EBITDA margin on net revenue
at 12.9% improved by 20 basis points, vindicating the
segment's superior execution capability and cost control
initiatives besides appropriate risk mitigation strategies
adopted by its various businesses.
Liquidity & capital
resources
Rs. crore
Due to paucity of customer advances in some of the fresh
orders, the segment net working capital at Rs.2,935 crore
2008-2009
2007-2008
964.46
1094.43
Cash & cash equivalents
at the beginning of year
Add: Net cash provided /
(used) by :
Operating activities
1478.57
1945.24
Investing activities
(4429.67)
(5241.89)
Sale of RMC business
1121.14
-
Financing activities
1640.79
3166.68
Cash & cash equivalents
at end of the period
775.29
964.46
The gross Debt Equity ratio of the Company stood at a
moderate level of 0.53:1, which helped it continue to enjoy
its domestic and international credit rating at 'AAA' & 'Baa2'
with stable outlook, respectively. With the vigilant treasury
team driving the Group's funding plans, the Company is
confident of sustaining its sound financial health in the near
to medium term.
BUSINESS SEGMENT WISE PERFORMANCE REVIEW
Engineering & Construction Segment (E&C)
The segment has performed exceedingly well during the
year despite the challenges of global meltdown and
uncertainty. Order inflow at Rs.45,418 crore increased by
28% as compared to the previous year. Prestigious orders
were secured by the segment in the Urban Infrastructure,
Power, Roads, Railways, Metals, Hydrocarbon and
74
has marginally increased by 1.8% of sales over the previous
year. With an additional capital expenditure of Rs.1,700
crore incurred during the year, the segment's net funds
employed as at the end of the year increased to Rs.6,617
crore from Rs.4,107 crore as of the previous year-end. As
a percentage of segment revenue, this works out to 23%,
higher by 2 percentage point as compared to previous year.
Electrical & Electronics Segment (E&E)
The segment was deeply impacted by the ill-effects of the
downturn that severely subdued the demand for industrial
goods, and could nevertheless achieve a growth of 4% in
sales revenue at Rs.2,778 crore during the year. The
Electrical Standard Products business suffered due to the
sluggish demand in the realty & manufacturing sectors.
The controlled petroleum prices regime sapped the fresh
investment in the retail oil dispensation systems, resulting
in negative growth in this business. The State Electricity
Boards deferred the implementation of their plans under
rural schemes, impacting the demand for metering systems.
Thus, despite a healthy sales growth of 23% achieved by
the Switchboard and Automation Systems businesses,
overall segment revenue growth remained low as aforesaid.
The drop in demand of its products also led to lower
capacity utilisation of the segment's enhanced facilities.
The under-absorption of overhead expenses, and higher
input prices prevailing over a large part of the year, saw
the segment margin dropping to 13.3% as compared to
16.9% of the previous year. The segment funds employed
at the end of the year increased by Rs.233 crore to Rs.1,247
crore, due to increase in finished goods inventories and
higher customer receivables.
Machinery & Industrial Products Segment (MIP)
This segment was also impacted by the slowdown in the
core industrial and infrastructure sectors. The significant
revenue growth observed in the last 3 years was absent
during the year, as the liquidity crisis unfolded in the second
half of the financial year. The negative sentiment led to a
sharp fall in the demand for construction & mining
machineries and industrial goods. Export of industrial valves
and machineries too was adversely impacted as the
sentiments in international trade reached an abysmal low.
Owing to the relatively better performance in the first half
of the year, the segment ended up with sales revenue of
Rs.2,475 crore for the year as a whole, which was
marginally higher than the previous year.
Though the slump in demand led to a drop in product prices,
the segment EBITDA margin on net revenue could be
improved by 110 basis points to 20%, due to higher rupee
realisation on the exports and improved cost management.
The year-end funds employed in the segment at Rs.413
75
better rupee realisation, the EBITDA margins for the year
rose to 24.5%. Funds employed as a percentage of gross
revenues showed marked reduction to 46%, due to better
management of customer receivables.
II. RISK MANAGEMENT
The Company has assiduously built, over the last few years,
a risk management culture in the Company, which has since
been ingrained in its various business processes. This has
encompassed a disciplined process of pre-bid risk review
of all major tenders for projects, review of the risk
complexion of projects at various stages during the course
of execution, and risk management assurance. An
enterprise-wide risk awareness has been successfully
created and integrated into the very process of business
decision making.
The global recession that started during the later part of
the year 2008-2009 has deeply impacted the business
sentiment world-over. Internationally, a number of
companies have deferred or cancelled their investment
plans.
In the aforesaid backdrop, the Company has fared
reasonably well during the year, not only in terms of a
comfortable growth in sales revenue and profitability,
achieved particularly by its largest business segment
Engineering & Construction, but has also witnessed a
reasonable growth in order inflow in the face of stiff
competition. A solid foundation led by an all pervading risk
management framework has helped the Company stand
out even in these trying times.
The presence of the Company in a host of diversified
industry segments has, in itself, an element of risk mitigation
against the vagaries of business downturn in one or the
other sectors. The Company's foray into the manufacture
of super critical boilers and turbines, heavy forgings, power
and railway business, has helped it exploit new avenues
of business, thereby greatly de-risking itself from the impact
of the downturn.
The Company's dependence on the international market
for business, has been less than 20% of its total turnover.
Therefore, the crippling depression seen in other parts of
the world could not leave much of an impact on the
Company's businesses during the year.
The Company has, during the year, created twelve
Operating Companies to lay larger focus on its various
businesses, and to provide them with more autonomy in
the conduct of their respective businesses. Besides
crore reduced by Rs. 26 crore over the previous year-end,
due to lower customer outstanding and higher initial
advances secured on its customers' orders despite liquidity
constraints in the market. Accordingly, the net working
capital decreased to 8% of revenue, as compared to 12.7%
for the previous year.
"Others" Segment
The performance of Ready Mix Concrete (RMC) and
Technology Services businesses comprising e-engineering
services and embedded systems is reported under "Others"
segment. The RMC business was divested on October 23,
2008 and accordingly the financial performance of this
business is not being separately elucidated.
The Technology Services business performed very well
during the year and was not adversely impacted by the
global slowdown since the IT development-related
outsourcing continued with their inherent cost advantages.
The business continued to have a large share of its
revenues coming from the US market.
Rs. crore
Technology services
performance
Gross revenues *
EBITDA % on net revenues
Funds employed as %
of net revenues
2008-2009
2007-2008
367
24.5%
190
9.5%
46%
71%
*Gross revenues include inter segment revenues
Aided by rupee depreciation of over 15%, the gross
revenues at Rs. 367 crore grew by 93% as compared to
the previous year. Owing to higher capacity utilisation and
76
formation of an Operating Company Board for each of them,
the risk management function has also been attached to
each of the Operating Company, to be able to closely
manage the risks of their businesses.
The Company has become a sponsor of the Engineering
& Construction Risk Institute (ECRI), USA, with an active
involvement, being on the Board of this prestigious institute.
It hosted the ECRI 2008 Risk Forum on "Global Risk
Management Practices for India Infrastructure Projects" in
Mumbai, where eminent risk practitioners from world class
E&C Companies like Bechtel, KBR and Shaw Stone &
Webster shared their best practices, covering various facets
of effective project risk management.
Financial Risks
(a) Liquidity and interest rate risks
Despite the prevailing tight credit conditions, the Company
has managed to ensure that funds are available to meet
its operational and strategic needs viz. capital expenditure,
working capital and strategic investments. At current
gearing levels and with its relatively comfortable liquidity
position, the Company is confident of managing its liquidity
over the short/ medium term. Further, the Company's short
term and long term credit rating and unutilised bank lines,
will enable raising funds at short notice to meet short term
liquidity gaps, if any.
The Company manages liquidity and interest rate risk by
accessing funds across various products, investor classes
and maturity profile. Besides this, the Company has in
place, various approved risk management tools to mitigate
interest rate risks.
(b) Foreign exchange and commodity price risks
The Company is exposed to foreign exchange rate risk
across projects / contracts, product businesses, loan
liabilities and its foreign currency denominated assets. The
Company is also subject to risk arising out of change in
commodity prices in respect of various inputs like steel, oil
and other base metals. Some portion of the foreign
exchange and commodity price risk is covered by way of
pass-through clause in project contracts with customers.
The balance is monitored through an elaborate risk
management protocol, periodically reviewed by the Audit
Committee / Board of Directors. The Company's Treasury
Hedge Management desk closely works with the constituent
business groups to price and hedge the aforesaid types of
risk under the aegis of a Board approved hedge
management policy.
III. INTERNAL CONTROLS
The Company believes that a robust internal control
mechanism is a necessary concomitant for effective
governance. The authority vested in the various levels of
management is exercised within a framework of appropriate
checks & balances. The company is committed to ensure
an effective internal control environment that helps in
preventing and detecting errors, irregularities & frauds, thus
ensuring security of Company's assets and efficiency of
operations.
There is a separate cell in the Company which oversees
implementation of internal control in the business processes
and information technology systems. A Corporate Policy
on Internal Control is in place which provides a structured
framework for identification, rectification, monitoring and
reporting of Internal Control weaknesses in the Company.
It specifies the responsibilities and tasks enjoined upon
employees in all positions. The various business segments
of the company have also, over the years, created well
documented policies, authorisation guidelines and standard
operating procedures specific to their respective
businesses.
The effectiveness of internal control is reviewed during
internal audits carried out by the Corporate Audit Services
on a regular basis. An independent review of the Internal
Control systems is also carried out by the Statutory Auditors.
Any significant deficiency in internal control along with the
progress in implementation of recommended remedial
measures is regularly presented to and reviewed by the
Audit Committee of the Board.
IV. NURTURING HUMAN CAPITAL
The Company has set its vision high to foster a culture of
trust, caring and continuous learning for its growing human
capital so as to ensure a continuous enhancement in
shareholder value. Sustained well-being of its employees,
both professional and personal, is the hallmark of its human
resource policies.
Being an engineering conglomerate, the Company needs
a large pool of engineering talent. Every year in line with
the growing business needs, the Company recruits a
sizeable number of Graduate Engineer and Diploma
Engineer Trainees from engineering colleges across the
country. "Prayag", a month-long induction programme,
helps these trainees to transition from the academic to the
industrial world to understand how engineering knowledge
is applied in practice.
A wide menu of training programmes is offered to our
employees for development. This year, a number of unique
strategic programs like Corporate Entrepreneurship,
Managing & Leading across Borders, Strategy and
Leadership programmes were added with a view to nurture
77
the knowledge, skill & behaviour required in the global
business scenario.
The Company endeavours to build a leadership pipeline in
a systematic and scientific way, using the most
sophisticated human technologies so as to achieve the
targets to be set out under Perspective Plan 2015. Towards
this end, the Company has launched two streams of
Leadership Development Program with the help of
Mckinsey & Company, namely :
(cid:2) Emerging Leadership Development Program (e-LDP) and
(cid:2) Top Leadership Development Program (t-LDP)
The eLearning initiative ATL - Any Time Learning launched
a few years ago has been augmented to include 'Harvard
Manage Mentor'- an engaging online resource consisting
of 42 management topics for fostering management skills.
This learning initiative enables learning anywhere, any time
and at one's own pace. The Company's Management
Development Centre at Lonavla is a symbol of the value
and priority that talent growth and development is accorded
in L&T. This prestigious facility is being augmented to triple
its training capability matching the Company's growing size
and stature.
V. RAPID STRIDES IN INFORMATION TECHNOLOGY
INITIATIVES
The Company is an intense user of Information Technology
in all aspects of its businesses. Having successfully
automated most of the transaction processing
requirements, the Company has also recently completed
implementation of niche solutions in other areas to enable
new capabilities.
The year saw the implementation of ERP solutions for a
few of the new businesses, to enable these new businesses
to use the information technology platforms right from
inception. The implementation of the enterprise-wide
Human Resources System in the various businesses has
made good progress. Significant improvements are also
being made to the IT infrastructure by enhancing the
capacity of networks, computing and storage. The
Company's IT governance and risk management framework
ensures that IT risk management and information security
are continuously monitored and beefed to protect the
confidentiality, integrity and availability of information
systems.
The company is also adapting itself to the new technologies
78
like virtualisation and power saving systems to support
"Green IT" initiatives. A systematic measurement of the IT
costs vis-a-vis the IT benefits derived ensures that the IT
initiatives deliver value to the businesses. The Company
believes that continued investments and value focus on IT
will go a long way in improving every aspect of the
Company's operations and thereby its profitability and
growth.
VI. SUSTAINABLE DEVELOPMENT THROUGH
ENVIRONMENT MANAGEMENT
The virtue of addressing the importance of "triple bottom-
line" is being felt today like never before. The Company
reckons its responsibility and is committed to playing an
instrumental role in this period of economic and social
change. The emphasis now is not just on increasing profits
but at the same time on improving the efficiency of all
business decisions and minimising the environmental and
social costs of operating in communities.
The first Sustainability Report published by the Company
for the year 2007-2008 emphasised the strategy to integrate
environmental, economic and social considerations in all
aspects of business development. We understand that the
social and environmental challenges are as dynamic as
the financial ones and hence we have taken steps to put in
place a robust organisational structure to address them
effectively. The Sustainability Organisation Structure,
headed by the Corporate Management Committee and
functional at all the business divisions and operating
locations, ensures that the commitment to conduct business
responsibly trickles down to the grass-root level across the
operations.
The Company has been taking focused steps to enhance
the quality of the community life in its immediate vicinity. It
has been diligently working to build the capabilities and
employability of the youth through its Construction Skills
Training Institute and Vocational Training Centres in
partnership with the various state governments and helping
women being self-reliant through professional skills training.
Apart from implementation of the OHSAS 18001:2007 and
ISO 14001:2004 management systems, the Company has
also started implementing the British Safety Council's
Health & Safety Management System at some of its
manufacturing locations for further strengthening its
systems and improving the working condition of the
employees.
GROWING SUBSIDIARIES & ASSOCIATES
PORTFOLIO
L&T Group is actively pursuing its diversified business
portfolio, particularly in the emerging businesses, through
formation of wholly owned subsidiary companies and joint
ventures with strategic partners. As on March 31, 2009,
the Group has 97 subsidiaries, 22 associate companies &
15 joint ventures within its fold. These entities broadly
operate in and focus on the following sectors:
1.
Information Technology Services
2. Financial Services
3. Engineering, Construction & Project Management
4.
Infrastructure and Property Development projects
5. Manufacture of electrical and industrial equipment,
machinery and products
6. Shipyard and Port facilities
Within the above classification, L&T has invested in
companies incorporated both in India & abroad. Most of
the investments in companies incorporated overseas are
through L&T's wholly owned subsidiary company, L&T
International FZE. Some of the ventures initiated in the
emerging sectors during the last 1-2 years are still in the
formative stage and are yet to contribute to the Group's
revenues. During the year, acquisition of the medium
voltage electrical business of TAMCO, Malaysia was
consummated and accordingly the turnover of the acquired
entities contributed to the growth in Group revenues.
Consolidated total income at Rs.41072 crore grew by 37%,
when compared to that of the previous year. Profit after tax
(PAT) for the consolidated Group at Rs.3789 crore
increased by 63% over the previous year, which is
marginally higher than the growth achieved by the
standalone Company at 60%.
The consolidated gross Debt:Equity ratio as at the end of
the year stood at 1.32:1 mainly due to higher borrowings
by the major capital intensive subsidiaries in the financial
services and developmental projects businesses.
A review of each of the operating subsidiary & associate
companies is presented below:
INFORMATION TECHNOLOGY SERVICES
I.
A. LARSEN & TOUBRO INFOTECH LIMITED (LTIL):
Subsidiary company
LTIL is a wholly owned subsidiary of L&T engaged in
providing IT solutions and software consultancy
globally. The Company offers both onsite and offsite
services in the areas of Application Maintenance &
Development, Enterprise Resource Planning, Data
Warehousing, Business Intelligence, Testing and IT
Infrastructure management. It has established its global
footprints in USA, Canada, Denmark, France,
Germany, Japan, UK and the Middle East. Around 26%
of the Company's total number of clients is in the Global
/ Fortune 500 list. The Company continues to focus on
the chosen verticals viz Manufacturing, Banking
Financial Services and Insurance, Energy and
Petrochemicals, Product Engineering Services
(comprising of Communications and Embedded
Software).
Operations & Performance
In the backdrop of global economic downturn, the
highlights of L&T Infotech's performance during the
year 2008-2009 are as under:
(cid:3)
(cid:3)
(cid:3)
19% growth in total revenues at Rs.1,975 crore
during the year 2008-2009 compared to Rs.1,658
crore achieved during the previous year. On
consolidated basis including subsidiaries in
Canada, Germany and GDA Technologies Inc.,
the total revenue grew to Rs.2,081 crore in 2008-
2009 from Rs.1,757 crore in the previous year.
21% increase in operating profit (PBDIT) which
was higher at Rs. 343 crore as against Rs. 283
crore in 2007-2008.
25% increase in profit after tax at Rs. 265 crore
as against Rs. 211 crore in 2007-2008.
Though USA continues to be the leading destination
for Software exports, its contribution for the year 2008-
2009 dropped to 67% vis-à-vis 74% for the previous
79
Banking & Finance, Insurance, and Communication
and Embedded technology businesses in Germany.
During the year 2008-2009, L&T Infotech GmbH
recorded total income of Rs. 52.12 crore, registering a
growth of 22%. The investment in sales and marketing
organization has contributed to the Company's revenue
growth. It has been able to secure new clients with
strong potential as also increase its presence with
existing clients. This is expected to reflect in the further
improved performance in the coming years.
C. LARSEN & TOUBRO INFOTECH CANADA
LIMITED (LTI Canada):
Subsidiary company
L&T Infotech Canada (LTI Canada) provides software
services in financial, Insurance and Oil & Gas sectors
in Canada. During the year 2008-2009, the total income
of LTI Canada amounted to Rs. 26.23 crore. The
Company has been able to improve its operating
performance by targeting on certain niche areas, which
has the potential to develop significantly in the years
ahead.
D. GDA TECHNOLOGIES INC. (GDA):
Subsidiary company
GDA Technologies was acquired in the year 2007 to
strengthen IT outsourcing business in USA. Since then,
GDA has been integrating its business development
with L&T Infotech's foray into the outsourcing business.
The Company has been scaling up its revenues largely
through the Offshore Design Centres, besides its
conventional segments of Property and Custom Design
& Manufacturing services.
GDA clocked total income of Rs. 60.46 crore for year
ended March 31, 2009. The efforts put in by the team
towards integration and leveraging of L&T Infotech
relationship with high potential customers is expected
to further improve the operational performance going
forward.
II. FINANCIAL SERVICES
A. L&T CAPITAL HOLDINGS LIMITED (L&TCHL):
Subsidiary company
Considering the emerging opportunities in the fast
growing financial sector of the country, the Company
has expanded its financial services range covering
commercial, retail & infrastructure finance and
merchant banking services. In order to consolidate
various business interests and create future value
year. Europe and Asia Pacific contributed 16% and
9% respectively, while contribution of Africa/MEA
increased to 4%. Onsite services accounted for 53%
of L&T Infotech exports and the balance was delivered
from the offshore development centers.
Outlook
The slowdown in global economic growth is expected
to continue into 2009-2010. This will adversely affect
the demand for IT services in the short term. In the
long term, however, the Indian IT sector is well poised
for growth, as its competitive advantage in outsourced
services space is sustainable. Several global mega-
trends viz. economic, demographic, business, social
and environmental, will create new opportunities for
the industry in:
(cid:3) New verticals: public sector, healthcare, media and
utilities (which have adopted global sourcing only
to a limited extent)
(cid:3) New customer segments: small and medium
businesses
(cid:3) New geographies: greater outsourcing in BRIC,
GCC, Japan and rest of the world
To take advantage of emerging opportunities L&T
Infotech has started focusing on internal efficiencies
and cost reduction. Given the industry's resilience to
withstand various challenges in recent years, the
Company is confident to sustain the growth momentum
in the medium term.
B. LARSEN & TOUBRO INFOTECH GmbH
(L & T infotech GmbH):
Subsidiary company
L&T Infotech GmbH provides software services in
80
potentials in the sector, the Company has set up a
wholly owned subsidiary for Financial Services;
viz. L&T Capital Holdings Limited and has consolidated
all its existing investments held in the Financial
Services Companies under L&TCHL.
B. L&T FINANCE LIMITED (LTF):
Subsidiary company
Overview
L&T Finance Limited, a wholly owned subsidiary of
L&T Capital Holdings Limited is one of the premier
diversified non-banking finance companies in the
country, with product offerings in Enterprise Finance
catering to various segments, Commercial Vehicle
Finance and Rural Finance. The Company is, from the
current year, actively engaged in microfinance in the
rural sector. It has a robust sourcing, underwriting,
receivables, collection and operational model,
commensurate with the size and risk of the respective
underlying asset class.
Operations & Performance
The performance of the Company during 2008-2009
was adversely affected due to the economic slowdown,
which resulted in lower business volumes across
almost all the sectors catered to by the Company. Tight
liquidity conditions witnessed during the financial year
also led to increased interest costs. During the year,
the Company added 24 branches to its network, taking
the total to 85, spread across 23 states. The highlights
of financial results for 2008-2009 are given below:
(cid:3)
(cid:3)
(cid:3)
Total assets grew from Rs.4,793 crore on March
31, 2008 to Rs.5,337 crore on March 31, 2009.
Total income grew to Rs.830 crore in 2008-2009
from Rs.606 crore in 2007-2008.
Profit after tax for the year was lower at Rs.99
crore as compared to Rs. 115 crore in 2007-2008.
Outlook
The business conditions for non-banking finance
companies continue to be challenging due to lower
economic/credit growth and high cost of funds.
Notwithstanding increasing competition, LTF is in a
strong position to deliver a resilient earnings profile,
supported by its well-balanced business platform and
strong asset quality. The Company's strategy, as in
the past, would be to focus on strong risk management
& processes, profitable growth and diversification of
its product portfolio.
C. L&T INFRASTRUCTURE FINANCE COMPANY
LIMITED (LTIFC):
Subsidiary company
LTIFC, a wholly owned subsidiary of L&T Capital
Holdings Limited, is focused on financing and
developing of infrastructure projects, covering various
sectors. The Company intends to leverage L&T's
domain knowledge in the engineering and construction
fields to provide infrastructure financing solutions
through a mix of debt, sub-debt, quasi-equity and equity
participation. It also provides active support to clients
at project development stage.
The key success factors for LTIFC are the sheer
demand for infrastructure in the country, the Company's
acknowledged expertise in all areas of infrastructure,
its ability to tap financial resources, its strategy to be a
'one-stop-shop' for infrastructure and a strong synergy
between the Company's professional management, its
Board of Directors and key stakeholders that allows
the Company to expeditiously pursue opportunities for
yet more profitable growth.
Operations & Performance
Amidst global slowdown and recessionary concerns,
the Company achieved significant growth during 2008-
2009, with gross approvals and disbursements of
Rs.1,913 crore for 39 projects and Rs.1,412 crore for
34 projects, respectively. The highlights of financial
results during 2008-2009 are:
(cid:3)
(cid:3)
(cid:3)
Total assets grew from Rs.1,916 crore as on March
31, 2008 to Rs.2,398 crore as on March 31, 2009.
Total income for the year 2008-2009 was Rs.296
crore as compared to Rs.110 crore in the previous
year
Profit after tax increased to Rs.76 crore in 2008-
2009 from Rs. 45 crore in 2007-2008.
Outlook
The business sentiment for infrastructure finance
companies continues to be challenging. With renewed
focus by the Government on infrastructure
development, announcement of the fiscal packages
to provide economic stimulus, LTIFC is in a strong
position to deliver improved performance on a
sustainable basis.
81
D. L&T CAPITAL COMPANY LIMITED (LTCCL):
Subsidiary company
LTCCL, a wholly owned subsidiary of L&T, is a SEBI
registered Portfolio Manager with close to Rs.1,450
crore under its fund management. It also provides
service as a Mutual Fund Distributor / Advisor. LTCC
holds and monitors a significant portion of the L&T
Group's strategic investments.
Operations & Performance
Mutual fund markets were subdued in 2008-2009. The
net asset values of most funds nose-dived. The
adverse capital market conditions had its impact on
LTCCL's income and profits. During the year, the
Company's gross income recorded a decrease of 25%
to Rs. 6.38 crore, as compared to Rs. 8.45 crore in the
previous year.
The Company is planning to expand its fund
management by offering offshore advisory services. It
is in the process of setting up wholly owned
subsidiaries in Mauritius towards meeting this
objective. The new services are likely to be offered in
the second half of 2009-2010.
Outlook
With the domestic stock market looking up, new
portfolio management avenues would be available. The
initiative in offshore advisory services is expected to
open up new vistas of regular income streams for the
Company, so as to counter the fluctuations in the
domestic market.
III. ENGINEERING & CONSTRUCTION
Domestic Companies
A. L&T-SARGENT & LUNDY LIMITED (LTSL):
Subsidiary company
Overview
L&T - Sargent & Lundy Limited (LTSL), a Joint Venture
company between L&T & Sargent & Lundy LLC
Chicago, USA, renders complete power plant
engineering services to its customers in India and
abroad. Besides being a major provider of Integrated
Engineering Solutions through 3 D modeling, LTSL has
established itself as a global consultant backed by a
competent engineering talent pool and technology
support.
Operations & Performance
Power sector got a boost during the year with many
82
UMPP's and other mega IPP projects declared for
bidding. The economic environment was encouraging
in the Middle East countries also facing a power deficit
As a result, the Company secured healthy orders for
engineering services, from domestic and international
markets. The sales and other income for 2008-2009
at Rs.62.74 crore registered a growth of 50%. Exports
accounted for 65% of the total income. Profit after Tax
at Rs. 10.43 crore for 2008-2009 rose sharply as
compared to the previous year level of Rs. 3.68 crore.
Outlook
According to Energy Information Administration (EIA),
world energy consumption is projected to expand by
50 percent upto 2030. Within the country, the
implementation of Rural Electrification Scheme and
amendments in the Electricity Act, 2007, are expected
to attract more investment in the power sector.
Moreover due to implementation of the 11th plan
capacity addition of 78.7 GW and the 12th plan capacity
addition of 82.2 GW, the power sector promises
enormous opportunities for the engineering services.
Given the good opportunities both in India and abroad
LTSL sees bright prospects in the medium to long term.
B. L&T-CHIYODA LIMITED (LTC):
Associate company
Overview
L&T-Chiyoda Limited (LTC) is an internationally
reputed design & engineering Consultancy Company
for Hydrocarbon Processing Industry. LTC was set up
in the year 1994 as a joint venture (JV) between
Chiyoda Corporation of Japan and Larsen & Toubro
Limited of India with an equal stake.
LTC offers total engineering solution to hydrocarbon
sector and related industries including Petroleum
Refineries, Petrochemical Units, Oil and Gas Onshore
Processing Facilities, LNG/LPG Plants, Fertilizer Plants
and Chemical Plants. Engineering and Consultancy
services offered by the Company include Feasibility
Studies, Basic Engineering, Front End Design &
Engineering
(FEED), Detailed Engineering,
Procurement Assistance, Construction Supervision,
Commissioning Assistance and Project Management
Consultancy, to many global and Indian Oil Companies.
Operations & Performance
The Company has already established its experience
in design and engineering of refinery units. Presently
it is involved with L&T in its Diesel Hydro-treating
Project of MRPL-Mangalore, two Hydrogen Generation
Units and LOBS Quality Up-gradation Project of HPCL-
Mahul Refinery. LTC, being the engineering partner
for most of the LNG/GTL Projects of Chiyoda, is getting
an excellent exposure to onshore oil/gas processing
plants. The Company is also in the process of finalising
Gas Treatment Project in Russia with an international
EPC contractor.
The Company reported a healthy growth in Order
Inflow and Sales revenue at Rs. 126 crore and Rs.79
crore respectively. Considering the long term growth
aspirations, Oil Companies continued with their
capacity augmentation projects even as the global
economy was grappling with the unprecedented
financial crisis. In line with the revenue growth, the
Profit after Tax for 2008-2009 at Rs. 10 crore grew by
34% as compared to the previous year.
Outlook
Indian energy sector is in the midst of a major capacity
augmentation program, considering the expected
surge in the demand for oil and gas products in the
next decade. Refining capacity in the country has been
growing at a rate of 4 to 5% every year. The growth
rate is expected to increase to around 7% by the end
of 11th Plan period 2007 to 2012, besides the plan for
setting up 3 grass root refineries in the country. The
Government is also promoting the sector through
various initiatives like the proposed SEZ-type scheme
to create Petroleum, Chemicals and Petrochemicals
Investment Regions (PCPIR). Considering that the
energy sector would be the backbone of the Indian
growth strategy, the sector is expected to attract
investment outlays which in turn would provide
attractive opportunities to the Company.
C. L&T-VALDEL ENGINEERING LIMITED (LTV) :
Subsidiary company
L&T-Valdel Engineering Limited (LTV), established in
2004, became a subsidiary of L&T in 2007-2008. LTV
provides complete engineering solutions for Upstream
Oil & Gas sector and offers design engineering services
as well as project management services globally.
Operations & Performance
The hydrocarbon sector saw spurt in E&P activities
following a sharp increase in crude oil prices during
2008-2009. The committed investments in the sector
enabled the Company to bag fresh engineering orders
and register a healthy revenue growth of 70% over
the previous year. Expecting the ramp up in the sector,
the Company had invested in expansion of facilities
and beefed up the talent pool, which enabled it to report
higher revenues at Rs. 72.46 crore. In tandem, the
profit after tax for the year 2008-2009 improved
significantly to Rs. 15.61 crore. Apart from the higher
capacity utilisation, the rupee depreciation also aided
the improvement in the operating margins during 2008-
2009.
Outlook
The crude oil prices declined significantly in the later
part of the year 2008-2009. The scenario of continued
depressed crude oil prices adversely impacted the
investments in the hydrocarbon sector. Though major
E&P players have not announced cuts in their plans
as yet, the companies are re-tendering the projects to
optimize the costs in the current recessionary scenario.
The Company, however, is confident of tiding over the
current economic slowdown with focused marketing
efforts in the international market and capability building
in the new lines of business such as Deep Water
Pipeline Systems, Jack-up Rigs, and Semi-
Submersibles.
D. L&T-MHI TURBINE GENERATORS PRIVATE
LIMITED and L&T-MHI BOILERS PRIVATE LIMITED
Subsidiary companies
Overview
Leveraging on the strengths of EPC capabilities in the
power sector, L&T has entered into Joint Venture with
the leading power plant equipment manufacturer,
Mitsubishi Heavy Industries, Japan (MHI) & Mitsubishi
Electric Corporation, Japan (MELCO) to manufacture
& supply Supercritical Boilers & Steam Turbines &
Generators (STG) for large coal based utilities. L&T-
MHI Turbine Generators Private Limited (LTMHI
Turbine) and L&T-MHI Boilers Private Limited (LTMHI
Boilers) have been formed with L&T holding the
majority share of 51% each of the equity through its
subsidiary L&T Power Limited. The principal business
of the JVs will comprise design, manufacture, supply,
erection & commissioning Supercritical Boilers,
Turbines & Generators and subsequent warranty and
service support for the Indian market.
LTMHI Turbine & Boiler have envisaged manufacturing
of equipment in the capacity range of 500 MW to 1000
MW for sale in India. Equipment will be manufactured
83
using advanced, fuel efficient & environment friendly
"Supercritical Technology". The total capacity being
installed is 4000 MW for each of the manufacturing
unit.
Project Activities
The Turbine JV Company has already secured order
for supply of 2800 MW STG from Andhra Pradesh
Power Development Company Limited. Also it has
undertaken bids for various projects and is expected
to bag few more orders shortly. The JVs are poised to
establish a state-of-the-art manufacturing facility at
Hazira, Gujarat State with the Technological Support
from MHI for a period of 20 years. The Turbine
Company proposes to commence operations with the
manufacture of 2 Turbines & Generators in the year
2010-2011, increasing the same to 4 from the year
2012-2013.
The implementation of the Steam Turbine & Generator
project has been conceptualised in phases. The
phased implementation schedule has been drawn in
consonance with the plan of acquiring of requisite skill
for specialised manufacturing activity and focused
indigenisation plan. All major machines & facilities have
been ordered and are slated for commissioning in a
phased manner aligning with the production plan.
F.
E. L&T- RAMBOLL CONSULTING ENGINEERS
LIMITED (LTR):
Associate company
Overview
LTR is a joint venture consultancy firm established in
the year 1998 by L&T and RAMBØLL A/s of Denmark.
LTR provides engineering and project consultancy
services for Transportation Infrastructure projects
relating to Ports & Harbour, Roads & Highways,
Bridges & Flyovers, Airports and Environmental
Engineering.
Operations & Performance
The Company has consolidated its position in the
domestic market as advisors and consultants to
developers of projects. This has enabled the Company
to utilise its strengths in the Design & Build segment
of Consultancy business. Backed by order inflow at
Rs. 35.88 crore, LTR registered in 2008-2009 a growth
of 23% in total income at Rs. 30.27 crore. In tandem,
profit after tax at Rs. 5.59 crore grew by 53% over the
previous year. The healthy performance was driven
84
largely by the new jobs for detailed engineering in Ports
& Bridges sectors.
Outlook
Infrastructure development is expected to gather
momentum during the balance period of 11th Plan
2007-2012. This is the niche market in which LTR has
a distinguished presence. Further, the Company is
rolling out a major expansion of its International
business in Indian Ocean RIM countries spurred by
good market prospects in this sector.
INTERNATIONAL SEAPORT DREDGING LTD
(ISDL):
Subsidiary company
Overview
International Seaport Dredging Limited (ISDL), a
Company promoted by the Belgian Dredging
International NV, was incorporated in March 2004.
Considering the captive business potential, L&T
acquired a majority stake in the Company in May 2006.
The business spectrum of ISDL includes dredging,
marine engineering services and land reclamation for
ports and harbours in India and the Middle East
countries.
Operations & Performance
Capital dredging continues to be the major growth area
of the Company. Due to the global slowdown and the
liquidity crisis, some of the private port projects were
postponed in the year 2008-2009. However with an
eye on the future, ISDL contracted for acquiring two
new dredgers, which will increase the capacity in the
coming years.
The fresh orders secured during the year by ISDL
include dredging project orders from Karaikal Port and
Kakinada Port and an order from charter hire in the
Middle East region. While dredging contracts were
completed at Gangavaram Port, Sethusamudram and
Hazira, the Dhamra Port order is under execution.
Due to significant variation in the underlying soil
conditions, the Company incurred loss on one of the
projects completed during the year. The Company has
taken adequate safety measures to mitigate such
operational risks with regard to orders under execution
and also would stringently evaluate the probable
operational risks for new prospects.
Outlook
With 2/3 rd of the Indian shores amenable for port
development and the prospects of significant increase
in international & coastal trade, the port sector is
expected to attract fresh investments over the next 5
to 10 years. Capital dredging business is therefore
expected to grow significantly to reach around 150
million cubic meters per annum over the next 5 years.
The Company is gearing up to meet the expected
increase in the demand in the coming years.
G. SPECTRUM INFOTECH PRIVATE LIMITED (SIPL):
Subsidiary company
L&T acquired SIPL in the year 2006 in order to
strengthen its capabilities in defence electronics. SIPL
concentrates largely on product development in
embedded solutions, control and signal processing. It
has grown from designing and development of sub-
systems to a full-fledged production organisation
capable of delivering sub-systems. Under the umbrella
of L&T's Strategic Electronics Center, SIPL is actively
exploring the opportunities for possible tie-ups in
various business areas of focus.
Operations & Performance
Sales revenues during the year 2008-2009 were
Rs.8.68 crores as compared to Rs. 7.36 crore in the
year 2007-2008. Profit after tax increased to Rs.1.68
crore, registering a marginal improvement over the
previous year.
Outlook
The long term outlook for defence electronics business
is quite positive. Public-Private participation during
design and development phase is expected to result
in a significant share of business for private industry
in the production phase. Revision of DPP-2006
regarding offsets and greater Government support for
PPP model are also in the offing. In addition, business
opportunities for HAWK & ALH production, LCH
development, Jaguar aircraft Upgrade programs and
MMRCA are likely to fructify in the coming years.
H. L&T SHIPBUILDING LIMITED (LTSB):
Subsidiary company
Overview
L&T Shipbuilding Limited has been formed as a joint
venture between L&T and Tamilnadu Industrial
Development Corporation Limited (TIDCO) for setting
up a Shipyard-cum-Minor Port Complex at Kattupalli,
near Chennai. L&T has identified shipbuilding as a
major thrust area in the heavy engineering sector for
growth. Indian Navy and Coast Guard have large
requirements of defence vessels and submarines to
augment as well as replace the ageing fleet.
Tamil Nadu has a coastline of about 1000 kilometres,
with plain landmass as hinterland. Due to this vast
coastline, the growing hinterland needs a State-of-the
Art port with allied infrastructure for effective handling
of all types of cargo. The Port Complex of LTSB is
expected to meet this requirement and is planned to
operate on a commercial basis with a capacity of 2
million TEUs per annum.
Project Activities
LTSB signed a joint venture agreement with TIDCO in
April 2008 to set up a port and a shipyard at Kattupalli,
Tamil Nadu. Following the extensive discussions with
the Government on the various critical requirements
of the project, LTSB has taken possession of 1123
acres of patta land at Kattupalli on 99 years lease basis.
About 27 acres of Poromboke land within the project
area is under alienation from Government and are likely
to be leased out to LTSB by June 2009.
The Shipyard is being organised as a heavy
engineering sector specific Special Economic Zone
(SEZ) under the Special Economic Zones Act, 2005.
In February 2009 LTSB received the formal SEZ
approval from the Ministry of Commerce and Industry.
LTSB has entered into a Licence agreement in
February 2009 with Tamilnadu Maritime Board (TNMB)
for using 76.86 acres of coastal land at Kattupalli
required by the project.
LTSB is in advanced stages of getting necessary
approvals from various Central and State Government
authorities. While the financial closure for the project
is in progress, the construction activity is expected to
commence in the second quarter of 2009-2010.
I.
International companies
LARSEN & TOUBRO ELECTROMECH LLC
(L&T Electromech):
Subsidiary company
Overview
Larsen & Toubro Electromech LLC is a joint venture
between Larsen & Toubro Limited, India (L&T) and The
Zubair Corporation, Oman (TZC). L&T holds 65%
through L&T International FZE, Sharjah and TZC holds
85
the balance. The Company is a leading Civil,
Mechanical and Electrical & Instrumentation
Construction Company in Oman catering to the Oil and
Gas, Refineries, Petrochemicals, Power and Water
sectors.
Operations & Performance
The Company executes projects predominantly in the
Hydrocarbon sector which contributes significantly to
the Oman's GDP growth. The global meltdown and
delays in announcement and award of new projects
had a negative impact on the order inflows for the year.
The total order inflow during the year 2008 was RO
18.21 mn (INR 237 crore) against RO 42.69 mn (INR
555 crore) in the year 2007. Backed by healthy opening
order book, the Company registered a growth of 35%
in Sales at Rs. 327.87 crore. Profit after tax increased
to RO 1.95 mn (INR 22.10 crore) as against loss of
RO 0.46 mn (INR 5 crore) in the year 2007.
In order to effectively counter the impact of global
slowdown, the Company has initiated various
measures on cost optimisation, pre-bid tie-ups with
major EPC players and
improved contract
management to enhance project realisation.
Outlook
Gulf countries are expected to counter the challenges
of falling oil prices and receding investor interest. Major
investments in petrochemicals are being delayed on
account of gas gap. However, Investment in Enhanced
Oil Recovery (EOR) projects is expected to continue
and offer good opportunities for EPC projects in Marmul
and Nimr areas. Major investments are also planned
in Power plants (IWPP & IPP) at Salalah, Barka and
Al-Ghubra areas in the Sultanate. In the backdrop of
stable fiscal position of the Sultanate, the Company
expects to achieve the targeted growth in the medium
term.
J. L&T MODULAR FABRICATION YARD LLC, OMAN
(LTMFYL)
Subsidiary company
Overview
L&T Modular Fabrication Yard LLC (LTMFYL) is a
wholly owned Subsidiary formed in Oman, to realise
the growing opportunities in the Middle East Oil & Gas
sector for manufacture and servicing of platforms and
marine structures. LTMFYL will endeavour to build core
competencies in high end equipment like Jack Up Drill
Rigs, Floating Production Storage & Offloading (FPSO)
86
Vessels, integrated Decks, Skid mounted equipment,
in addition to fabrication of large size Offshore
Platforms.
The Fabrication Yard facility at Sohar has become fully
operational during the year. The Yard is expected to
be established as a major fabrication service provider
for the region's promising offshore oil & gas industry,
comparable with some of the biggest fabrication yards
of this kind in the region.
Operations & Performance
LTMFYL executed projects in Upstream Oil & Gas for
Oil & Natural Gas Corporation, India, and for Maersk
Oil, Qatar and also undertook refurbishment of Rig
FDVII for Lynemouth Drilling Limited; U.K. LTMFYL
recorded Sales worth Rs. 102.92 crore for the year
2008, its first full financial year. By the end of the year
2008, due to economic meltdown, the Oil & Gas
segment witnessed deferment of orders by clients and
pressures for lowering of prices quoted by the Yard.
Outlook
The Middle East Oil & Gas sector is active with bids
for projects involving fabrication & integration of
Modules for FPSO, though slowdown effect is still
pervading the region. While, the refurbishment orders
offer opportunities in the short term, the major projects
are expected to reach implementation phase only in
the latter half of the year 2009. With crude oil prices
showing some signs of stability, the sector is expected
to hasten up the projects which are already on the
drawing board. The Company will endeavor to improve
its capacity utilisation by harnessing the opportunities
coming its way.
K. LARSEN & TOUBRO ATCO SAUDIA COMPANY
LLC (L&T-ATCO):
Subsidiary company
L&T-ATCO is a joint venture between L&T International
FZE and Abdulrahman Ali Al -Turki Group of
Companies (ATCO) Dammam, a renowned Saudi
conglomerate. L&T ATCO was incorporated to take
advantage of the enormous electro-mechanical
construction opportunities arising in the areas of oil &
gas, petrochemicals, power and water related projects
in Saudi Arabia.
L&T-ATCO is focusing business opportunities in the
area of strategic construction equipment & support
services, with the core team of engineers operating
from Dammam. Having completed all the statutory
registration process,
is now
concentrating on pre-qualification with various
customers & is participating in tenders for leading
clients.
the Company
provides engineering, construction and contracting
services in Oman. Continuing its excellent track record
of 14 years, LTO reported encouraging financial
performance for the year 2008.
Outlook
Firm oil prices, availability of liquidity and the
Government's social and economic reforms are
positive indicators of the Saudi economic growth. Large
projects in the field of hydrocarbon, power, water and
oil & gas are being envisaged to sustain the long term
development of the country. Specific tie-ups with
prominent EPC players who are aware of L&T's
capability
in refinery & petrochemical and
demonstration of on-ground resources could open
windows of opportunities for projects.
L. OFFSHORE INTERNATIONAL FZC
Offshore International FZC (Offshore FZC) is a Joint
Venture between L&T International FZE and M/s Petro-
Plus Sdn Bhd, Malaysia, a wholly owned subsidiary of
Sapura Crest Petroleum Bhd, Malaysia, formed for
construction and operation of a Heavy Lift cum Pipe
Lay Vessel (HLPV). The Company was incorporated
to provide critical in-house installation facility for
Offshore Platform projects being executed by L&T and
thereby mitigate the risk of dependence on external
sub-contractors.
Sapura Crest Petroleum Berhad is a leading company
in Malaysia with diversified activities having expertise
in offshore installation services including subsea pipe-
laying, platform and relation installations. Through the
joint venture company, Sapura Crest and L&T will be
able to tender for installation and EPC contracts. This
offers both companies greater competitive advantages
especially in the Indian and Malaysian markets - two
of the fastest growing oil and gas services markets in
the region.
The vessel is in an advanced stage of construction in
a renowned shipyard in Singapore. The twin deck 160-
metre conventional vessel can accommodate about
250 staff and is equipped with a crane capable of lifting
heavy loads of up to 3000 ST. The vessel is expected
to be available for commercial use in the year 2010.
M. LARSEN & TOUBRO (OMAN) LLC (LTO):
Subsidiary Company
Larsen & Toubro (Oman) LLC, a joint venture between
L&T International FZE and Zubair Corporation LLC
Operations & Performance
During the year LTO handed over Palm Garden
Township and Bait Al Barakah projects. The completion
of these mega projects enabled LTO to cross RO 100
Million turnover. The year 2008 saw gross income
nearly doubling to Rs. 1490.76 crore, with an increase
in Net Profit to Rs. 56.79 crore as compared to Rs.
26.24 crore in the year 2007.
Outlook
With the Government of Oman adopting growth
oriented economic policies, Oman is progressing
amidst challenging times. The Company sees
emerging growth potential in Building & Urban
Infrastructure and Power Transmission & Distribution
sectors. Whilst its focus on established sectors
continues, LTO has initiated its entry into the
Infrastructure segment. It will target brown-field and
green-field airport projects and highway expansion
projects with the active support from L&T, India.
N. LARSEN & TOUBRO SAUDI ARABIA LLC (LTSA):
Subsidiary Company:
LTSA a subsidiary of L&T International FZE is engaged
in the business of providing turnkey solution in Civil,
Mechanical and Electrical Engineering Projects in the
Infrastructure, Building, Power Transmission and
Distribution Sectors.
Operations & Performance
During the year 2008, the Company downsized its
operations and did not procure any fresh order.
Consequently, revenues recorded during the year 2008
were Rs. 5.10 crore while the losses amounted to Rs.
4.50 crore due to cost overruns. Due to unfavourable
business conditions, the Company has decided to wait
and watch till the global economy recovers.
Outlook
In order to exploit the business potential the Company
is in the process of identifying a strong local partner
who will help in promoting the business of LTSA in the
Kingdom of Saudi Arabia.
87
O. LARSEN & TOUBRO QATAR LLC (LTQ):
Subsidiary company
LTQ, a joint venture between L&T International FZE
(49%) and a local Company Al-Jazeera International
Trading Company WLL (51%) undertakes Turnkey
Engineering and Construction projects in the Building,
Infrastructure, Power and Electrical projects in Qatar.
Operations & Performance
The Company did not submit any tender during the
year 2008. Revenues accordingly declined to Rs.4.14
crore as against Rs.29.97 crore in the year 2007. The
loss for the year was contained at Rs.0.88 crore
(previous year - loss of Rs.8.26 crore).
Outlook
In order to tap the major projects the Company has
decided to revitalise its operations by switching
partners. The Company is planning to join hands with
a locally strong partner who will help in promoting the
business of LTQ in Qatar. The country has proposed
an ambitious investment plan of over USD 100 billion
by the year 2015 in the Energy, Tourism and other
infrastructure projects. With the help of the new partner,
it is expected that the Company shall turn around in
the near future.
P. LARSEN & TOUBRO KUWAIT CONSTRUCTION
GENERAL CONTRACTING COMPANY WLL (LTKC):
Subsidiary company
LTKC is a limited liability company jointly held by M/s
Bader Almulla and Brothers Company WLL, a Kuwaiti
company & M/s Larsen & Toubro International FZE,
U.A.E. in the shareholding pattern of 51% and 49%
respectively. LTKC executes construction projects in
Oil & Gas and Power sectors in the State of Kuwait.
Performance
On the strength of its parent's strong credentials and
its own pre-qualification initiatives, LTKC secured
orders for fabrication and erection of tank and pressure
vessels during the year totaling to KD 5.65 Million
(Rs.95.27 crores). The execution of these orders has
commenced.
Outlook
Kuwait has the fourth largest proven reserves of crude
oil in the world and is among the world's largest oil
producers. Kuwait Petroleum Council has major plans
for building its largest refinery. The recent decline in
88
oil price has somewhat impacted the growth sentiments
in the region. However, no significant slowdown effects
have been noticed in Upstream Projects. The country
has taken initiatives to privatise Crude Handling and
Refining by inviting private developers on BOO basis.
Kuwait is still short of power and therefore investment
in Power Sector is envisaged to be around 1 to 2 Billion
KD in next 3 to 5 years.
Q. LARSEN & TOUBRO READYMIX CONCRETE
INDUSTRIES LLC (RMC LLC)
Subsidiary company
RMC LLC was formed in July 2006 as a joint venture
between Mr Shukri Saleh Al Braik, UAE (51%) and
Larsen & Toubro International FZE (49%) as per the
local law. The first plant was operational in January
2007 and second plant in November 2007. The
business was established in a highly competitive
market with many MNCs in the fray for Ready-Mix
Concrete business.
Operations & Performance
The year 2008 was the first full year of operations with
both the plants producing at rated capacity. RMC LLC
recorded sales revenues at Rs. 132.10 crore and net
profit of Rs. 15.18 crore.
Outlook
The Impact of worldwide recession has been acute in
Dubai region. New projects have been hard to come
by while there has been a market slowdown in the
progress of many existing projects. The Company is
striving hard to sustain its current performance during
the year 2009 inspite of difficult conditions. Efforts have
been initiated in reducing raw material costs and also
explore opportunities in Abu Dhabi market so as to
compensate for the probable shortfall in volumes.
IV. POWER DEVELOPMENT
A. L&T POWER DEVELOPMENT LIMITED (L&T PDL):
Subsidiary company
L&T PDL, incorporated in September 2007, is a wholly
owned subsidiary of Larsen & Toubro Limited (L&T).
The Company is formed as a power development arm
of L&T with the objective of developing, investing,
operating and maintaining power generation projects
of all types namely thermal, hydel, nuclear and other
renewable form of energy including captive and co-
generation power plants.
The Company is developing a 99 MW Singoli Bhatwari
Hydro Electric Project through a wholly owned
subsidiary L&T Uttaranchal Hydropower Limited (L&T
UHPL). The Company is also pursuing opportunities
to develop thermal and hydro electric projects in India
and abroad.
B) L&T UTTARANCHAL HYDROPOWER LIMITED
(L&T UHPL):
Subsidiary company
The Company is executing Singoli Bhatwari Hydro
Electric Project on Build-own-operate-transfer (BOOT)
basis for a period of 45 years including the construction
period. The project is a run-of-the-river scheme on river
Mandakini in Rudraprayag district of Uttarakhand. The
project involves construction of a 22m high and 57.2m
long barrage, 12 km long head race tunnel, surface
powerhouse and 12 km transmission line (132 kV).
The Project is expected to achieve financial closure in
the year 2009-2010 with a total cost estimated at Rs.
1080 crore.
V.
INFRASTRUCTURE AND PROPERTY
DEVELOPMENT
A. L&T INFRASTRUCTURE DEVELOPMENT
PROJECTS LIMITED (L&TIDPL):
Subsidiary company
L&TIDPL has been set up as an Infrastructure
development arm of the Group. L&TIDPL, a holding
As of March 31, 2009, L&TIDPL's portfolio includes:
I.
Transportation and Infrastructure
Major SPVs
Roads and Bridges:
Narmada Infrastructure Construction Enterprise Limited
L&T Transportation Infrastructure Limited
L&T Western India Tollbridge Limited
L&T Panipat Elevated Corridor Limited
L&T Krishnagiri Thopur Toll Road Limited
L&T Western Andhra Tollways Limited
company in this segment, works on a "value creation"
model so that the Special Purpose Vehicle (SPV)
floated for each infrastructure project is nurtured till it
reaches a stage of matured operations. The Company
has, over a period of time, built up capabilities in
identifying and developing infrastructure projects,
operation & maintenance of these projects and
providing advisory services relating to financing &
engineering of the projects. Considering the potential,
private equity Investors have contributed 21.6% to the
capital of the Company.
L&TIDPL portfolio is well diversified with a mix of
projects across various sectors such as roads &
bridges, ports, airports and urban infrastructure. L&T
Urban Infrastructure Limited, a subsidiary of L&TIDPL,
houses the property development and urban
infrastructure projects.
Operations & Performance
The Financial Year 2008-2009 was eventful with
several of its projects commencing commercial
operations. These include Panipat Elevated Corridor
(July 2008), Krishnagiri Thopur Toll Road (February
2009), Western Andhra Tollways (March 2009) and
Bengaluru International Airport (May 2008).
During 2008-2009, the Company divested its stake in
Kakinada Seaports Limited. Including the divestment
Income L&TIDPL has reported a total income of Rs.
38.40 crore and a profit after tax of Rs. 10.83 crore.
Status (% of holding)
Stage
Subsidiary (100%)*
Subsidiary (100%)*
Subsidiary (100%)*
Subsidiary (100%)
Subsidiary (100%)
Subsidiary (100%)
Operational
Operational
Operational
Operational
Operational
Operational
Operational
Second Vivekananda Bridge Tollway Company Private Limited
Associate (33%)
L&T Interstate Road Corridor Limited
L&T Vadodara Bharuch Tollway Limited
Ports:
Subsidiary (100%)
Subsidiary (100%)
Construction completed
Under implementation
International Seaports (Haldia) Private Limited
Associate (22%)
Operational
The Dharma Port Company Limited
Joint Venture (50%)
Under Implementation
89
II. Urban Infrastructure:
Major SPVs
L&T Urban Infrastructure Limited
Cyber Park Development and Construction Limited
L&T Tech Park Limited
L&T Arun Excello IT SEZ Private Limited
L&T Infocity Limited
L & T South City Projects Limited
L&T Phoenix Infoparks Private Limited
CSJ Infrastructure Private Limited
Status (% of holding)
Stage
Subsidiary (75%)
Subsidiary (30.47%)
Subsidiary (30.47%)
Subsidiary (30.47%)
Subsidiary (53.17%)
Operational
Operational
Operational
Operational
Operational
Subsidiary (30.47%)
Under Implementation
Subsidiary (30.47%)
Under Implementation
Subsidiary (41.82%)
Under Implementation
L&T Arun Excello Commercial Projects Private Limited
Subsidiary (30.47%)
Under Implementation
L&T Infrastructure Development Projects Lanka (Private) Limited
Subsidiary (75.37%)
Under Implementation
Outlook
The Public Private Partnership model adopted by the country has yielded positive results in terms of increasing the pace
of infrastructure development. In order to sustain a much higher level of economic growth over the next decade, the
Government has taken proactive steps in creating conducive environment for attracting the private participation in the
infrastructure sector. L&T IDPL has appropriately positioned itself to realize the emerging opportunities in the entire
gamut of infrastructure development sector. With healthy cash generation expected during the coming year from the
operational subsidiaries, the Company is geared up to invest in new projects.
Financial performance summary of key operational SPVs: roads, bridges, ports and airports:
A. Projects completed:
Project cost
(Rs.crore)
Total income (Rs. crore)
2008-2009
2007-2008
PAT (Rs. crore)
2008-2009
2007-2008
421.50
25.76
NA
(31.05)
NA
37.75
36.08
16.95
15.17
Sr. no.
Name of subsidiary
Project details
L&T Panipat
Elevated Corridor
Limited
Narmada
Infrastructure
Construction
Enterprise Limited
Widening the existing 4 lane
Road to 6 lane Road on National
Highway No.1 (NH-1).
Concession period is 20 years
including the construction period.
The project was completed much
ahead of the schedule during
the year 2008-2009.
Second Two-Lane Bridge at
Zadeshwar across the
Narmada River in Gujarat
on National Highway 8 (NH-8).
Concession period is 15 years
on Build-Own-Transfer basis.
The bridge is operational since
November 2000.
1
2
90
Project cost
(Rs.crore)
Total income (Rs. crore)
2008-2009
2007-2008
PAT (Rs. crore)
2008-2009
2007-2008
525.00
9.41
NA
(5.49)
NA
372.83
1.53
NA
(1.86)
NA
33.68
28.16
8.50
3.22
Sr. no.
Name of subsidiary Project details
L&T Krishnagiri
Thopur Toll Road
Limited
L&T Western
Andhra Tollways
Limited
L&T Transportation
Infrastructure
Limited
Widening the existing 2 lanes
Road to 4 lanes Road from the
end of proposed Krishnagiri
flyover to Thumpipadi.
Concession period is
20 years including the
construction period.
The project was completed
and opened to traffic from
February 7, 2009.
Construction, development,
operation and maintenance of
the road from Jadcherla to
proposed Kotakatta bypass
on NH-7 in the State of
Andhra Pradesh.
Concession period is
20 years including the
construction period.
The project was completed
and opened to traffic from
March 14, 2009.
Building a bypass (28 Kms) at
Coimbatore Section of National
Highway (NH-47) and
construction of additional
Two-Lane bridge at Athupalam
on River Noyyal. Concession
period is 32 years including
the construcion period.
3
4
5
6
7
L&T Western
India Tollbridge
Limited
Building a two-lane bridge
across river Watrak including
its approaches.
11.31
10.71
3.01
2.64
L&T Interstate
Road Corridor
Limited
Concession period was 10 years
up to the end of 2009.
The bridge was constructed and
opened for traffic in March 2001.
Construction, operation and
maintenance of the road on
Palanpur Swaroopgunj section
of NH 14 in the state of
Gujarat and Rajasthan.
The road was constructed as per
the schedule during the year
2008-2009
554.00
0.09
NA
(0.06)
NA
91
B. Projects under implementation: Roads and Ports
THE DHAMRA PORT COMPANY LIMITED (DPCL):
Joint venture
The Dhamra Port Company Limited (DPCL), a 50:50
joint venture between L&T IDPL & Tata Steel Limited,
has been set up to build a deep water all-weather port
at the existing minor port of Dhamra under Build-Own-
Operate-Share-Transfer (BOOST) model with a
concession awarded by the Government of Orissa for
a period of 34 years (including 4 years of construction).
Sheltered between the mainland and Kanika sands
island on the eastern coast, Dhamra Port will be the
deepest all weather port of its kind in India, with a
draught of 18.5 meters, which can accommodate super
cape -size vessels up to 1,80,000 DWT. This will be
an advantage to the mineral hinterland of north Orissa,
Jharkand, West Bengal and Chattisgarh where a large
number of steel plants and mineral based industries
are located. The highly mechanized and advanced
material handling facilities planned at the port will offer
the users loading and discharge rates comparable to
the world's best. The project includes 62.5 km rail
connectivity to the main Howrah- Chennai line at
Bhadrak.
The port will eventually have 13 berths to handle over
83 million tons of cargo per annum. Of these, the first
two berths, with a handling capacity of up to 25 million
tons of bulk cargo per annum, will come up in the First
Phase. When fully developed, the port will handle all
types of cargo, such as dry bulk, liquid and container
cargo. Apart from Tata Steel who is a co-promoter of
the port, a number of other steel plants, mines and
industries in the region are expected to use the port,
which could become eastern India's major gateway to
the world.
The construction of the port is progressing as per the
schedule and about 50% work has been completed.
As part of the environment management system
developed in consultation with World Conservation
Union (IUCN), the company has undertaken plantation
programme along the 62 km rail-road corridor from
Bhadrak to Dharma.
The status of other major projects under execution is summarised below:
Projects under implementation
Sr. no.
Name of subsidiary
Project details
Project cost
Rs. crore
1450
L&T Vadodara Bharuch Widening the existing road of Vadodara to
Tollway Limited
Bharuch section on NH-8 in the State of
Gujarat to 6 Lane Road. Concession period
is 15 years including the construction period.
L&T Ahmedabad -
Maliya Tollway
Private Limited
L&T Halol - Shamlaji
Tollway Private Limited
L&T Rajkot - Vadinar
Tollway Private Limited
1481
1302
1075
Widening the existing Two-Lane Road
covering Ahmedabad, Viramgam &
Maliya, to Four-Lane Road along with the
divided Carriageway facility. Concession
period is 22 years including the construction
period.
Widening of existing Two-Lane Road,
covering Halol-Godhra-Shamlaji section
in Gujarat to Four-Lane Road alongwith
divided Carriageway facility. Concession
period is 20 years including the construction
period.
Widening the existing Two-Lane Road,
covering Rajkot-Jamnagar-Vadinar
section in Gujarat, to Four-Lane Road
along with the divided Carriageway facility.
Concession period is 20 years including the
construction period.
1
2
3
4
92
Project status
As at March 31,2009, 95% of the project
has been completed and the widened
Road would be open for traffic ahead of
the schedule.
Financial Closure expected to be achieved
in the first half of the year 2009,
commercial operations expected by the
end of the year 2011.
Financial Closure expected to be achieved
in the first half of the year 2009,
commercial operations expected by the
second half of the year 2011.
Financial Closure expected to be
achieved by first half of the year 2009,
commercial operation is expected by
the second half of the year 2011-2012.
II. URBAN INFRASTRUCTURE
C. L&T URBAN INFRASTRUCTURE LIMITED
(LTUIL):
Subsidiary company
LTUIL, a subsidiary of L&T Infrastructure Development
Projects Limited, has been formed to drive the real
estate business of the Group in the fast growing urban
areas. The Company over the period of last three years,
has built a balanced portfolio of premium urban
infrastructure and real estate development projects
comprising IT/ITES infrastructure projects, commercial
and hospitality projects, and residential projects.
Operations & Performance
LTUIL has invested in 9 projects, (under IT/ITES
sector), of which 6 projects are operational and balance
3 projects are under construction. A total of 50 lakh sq.
ft. space has, so far been developed in this sector. A
further space of 50 lakh sq. ft. has been envisaged for
development as and when the demand picks up in the
realty sector.
So far LTUIL has invested Rs. 516 crore in the above
realty projects. LTUIL earned Total Income of Rs. 13.50
crore during 2008-2009 and has reported a higher profit
of Rs. 6.01 crore.
Outlook
The realty sector has been impacted by the liquidity
crisis during the second half of the financial year 2008-
2009. While the interest rates have started softening,
the buyers are negotiating for reduced property prices.
The 'wait mode' adopted by the customers is forcing
the sector to defer / delay the new projects in the offing.
Considering that the industry players have already
invested in the property at a relatively higher cost, there
is little leeway for them to further cutback the rates.
Given this uncertain conditions prevailing in the market,
the sector sees a subdued performance in the near
term.
Financial performance summary of key operational SPVs: (Urban Infrastructure)
A. Projects completed
Sr. no.
Name of subsidiary Project details
1
2
3
Cyber Park
Development and
Construction
Limited
L&T Tech Park
Limited
Construction of IT park at Electronic City,
Hosur Road, Bangalore.
Company has taken land on lease from Software
Technology Parks of India for a period of
66 years.
The first phase of the project, a multi tenanted
facility with a BUA of 3.00 Lac sq.ft. was
successfully completed and sold off.
The second phase of the project with BUA of
2.00 Lac sq.ft. has also been completed in the
year 2008-2009, of which a substantial portion
has been marketed.
Company formed to set up an IT SEZ within
the Infopark, at Kochi, Kerala, as a co-developer.
The Company has acquired land of 7.44 acres
on lease for a period of 90 years.
The company has successfully implemented its
first phase of the project, Tejomaya, a multi
tenanted facility, with a built up area of 3.86 lakh
sq.ft., a major part of which has been sold.
L&T Arun Excello
IT SEZ Private
Limited
The company formed for developing a built up
area of 3 lakh sft of office space for IT/ITES
over 29 acres of land situated at Vallancheri
Village, Kancheepuram District, Tamil Nadu.
Total Income (Rs.crore)
2008-2009
2007-2008
PAT (Rs.crore)
2008-2009
2007-2008
48.42
17.04
11.14
9.15
17.14
17.38
(1.89)
0.90
1.03
0.40
(0.31)
(0.44)
93
Sr. no.
Name of subsidiary
Project details
Total Income (Rs.crore)
2008-2009
2007-2008
PAT (Rs.crore)
2008-2009
2007-2008
Out of the total area of 3 lakh sq.ft. in the
Signature Tower, 73,220 sq.ft. space has been
booked.
4
L&T Infocity Limited The company focuses on
195.53
194.64
53.42
49.35
(i) Operating and maintaining the multi-tenanted
IT Parks
(ii) Operating the Built to Suit IT facilities
(iii) Facility Management and
(iv) Development and Sale of Residential Units
in Mega Residential Project 'Serene County'.
The modern trade exposition centre developed
on a 52.79 acre plot consists of three exhibition
halls of 3500 Sq.mtrs. each, open display area,
a large parking area and a trade fair building to
provide office space for trade fair organisers,
vendors and exhibitions service providers.
Hyderabad
International
Trade Expositions
Limited
9.90
12.19
(0.81)
1.84
L&T Infocity Lanka
Private Limited
Development of a Built to Suit Project for
HSBC at Colombo, Srilanka.
5.01
4.17
1.78
2.09
5
6
B. Projects under implementation (Urban Infrastructure)
Sr. no.
Name of subsidiary
Project details
Project status
L&T South City
Projects Limited
Developing a township consisting of residential complex,
school, public health centre, shopping complex etc., over
83.5 acres of land situated at Siruseri Village,
Chenglepet District.
L&T Phoenix Infoparks Company formed to undertake development of commercial
Private Limited
properties.
Presently it is developing two projects in Hyderabad; namely;
HITEC City-2 & Intellicity.
CSJ Infrastructure
Private Limited
Company formed for development of Commercial complexes
in Chandigarh.
L&T Arun Excello
Commercial Projects
Private Limited
Commercial constructions comprising of a star hotel, a
shopping mall and a school on 13 acres of land in the Estancia
Township at Vellanchery on GST Road in Chennai.
L&T Hitech City Limited Company floated by L&T Infocity Limited, in partnership with
APIIC, to set up an IT SEZ at Vijayawada.
L&T Infrastructure
Development Projects
Lanka (Private) Limited The project entails development of a total of about
Development, construction, operation and maintenance of a
multipurpose hi-rise tower of 51 floors in Colombo, Sri Lanka
1.22 million sq.ft, of residential apartments and
commercial space.
At present, the first phase of the project is
in progress for developing 656 residential
units with a built up area of 1.095 mn sq.ft.
Phase I: Construction of IT Park with a
project cost of Rs.43 crore has
commenced during the year and is
expected to be completed in the first half
of the year 2009-2010.
The project is expected to achieve
financial closure in the first half of the year
2009-2010 and the construction will be
completed in the year 2012-2013.
1
2
3
4
5
6
94
VI. ELECTRICAL & ELECTRONICS
A. L&T ELECTRICALS SAUDI ARABIA COMPANY
LIMITED, LLC (LTESA):
Subsidiary company
Overview
L&T Electricals Saudi Arabia Company Limited.
(LTESA), a joint venture between Larsen & Toubro
International FZE, U.A.E. and Yusuf Bin Ahmed Kanoo
Group, was formed in September 2006 for
manufacturing and marketing switchgear, control gear,
PLC panels, AC/DC Drives and Part Assembled
Switchboards.
Operations & Performance
LTESA through its cost competitive solutions is
receiving encouraging response from major customers
and EPC companies in Saudi Arabia. During the year
2008, the first year of its operations, the Company
clocked a turnover of Rs.30.46 crore for the nine month
ended December 2008 with a net profit of Rs.0.80
crore. The company ended the year with a healthy
order book of Rs.43.16 crore.
Outlook
Saudi Arabia is the largest market in the Middle East.
The policy of the Government is continually inclined
towards providing business opportunities for locally
established industries. Major investments in Refinery,
Petrochemicals, Power and Infrastructure projects offer
good prospects for the Company's growth. However,
in view of the present change in the economic situation,
the finalisation of major projects may get delayed and
customers may take an advantage of reduced
commodity prices. Despite the above negative signs,
LTESA remains a competitive player in high end
offering and system business.
B. LARSEN & TOUBRO (WUXI) ELECTRIC
COMPANY LIMITED (LTW):
Subsidiary company
LTW is a 100% subsidiary of L&T International FZE,
located at Wuxi in Jiangsu province of China. The
factory was established in the year 2006 with the state-
of-the-art manufacturing facilities, quality control and
reliable testing equipment. It was established to support
& extend L & T activities related to brand labelling of U
Power design of Air Circuit Breakers (ACBs) & D-Sine
Moulded Case Circuit Breakers (MCCB's) range. The
factory has received ISO 9000 & China Compulsory
Certification (CCC) for both the products range.
Operations & Performance
During the year, the Company recorded sales revenue
growth at Rs 30.20 crore and a profit of Rs 1.11 crore.
Efforts are on to establish the brand, first in the Chinese
market and later on explore into other South Asian
markets.
Outlook
Although the Chinese economy has slowed down, the
continuous investments in infrastructure in China
makes the prospects attractive for the Company's
switchgear products.
C. TAMCO GROUP OF COMPANIES
Overview
In order to gain a strong foothold globally in the low
and medium voltage switchgear range, L&T acquired
TAMCO Group of Companies in April 2008. The
TAMCO Group of Companies comprises of 4
companies, operating in Malaysia, Indonesia, Australia
& China.
TAMCO Malaysia is a significant player in South East
Asia for Medium Voltage (MV) switchgear comprising
of Vacuum Circuit Breakers (VCB's), Ring Main Unit
(RMG), Gas Insulated Switchgear (GIS), busducts and
switchboards. In addition, it addresses the utility
markets in Dubai, Qatar, Abu Dhabi, South Africa,
Ghana, Sudan etc. TAMCO is now transferring its
technology to L&T India to cater to the Indian MV
switchgear market.
TAMCO Indonesia & TAMCO China have established
manufacturing facility in Jakarta & Shanghai
respectively for catering to Low Voltage (LV)
switchgears market in their respective countries.
TAMCO Australia is a supplier of both LV & MV
switchgears in the Australian markets with a
manufacturing unit in Melbourne.
Operations & Performance
Despite the economic slowdown, the Order Book
position in both Malaysia & Australia for utility segment
remains healthy. Indonesia & China, though affected
by slowdown, have recently shown signs of revival.
During the financial year under review, TAMCO Group
received fresh orders totaling to Rs.610 crore
predominantly from Utility segments. Post acquisition
of TAMCO Group, the group recorded revenue of
Rs.424 crore and profit after tax at Rs. 12 crore for the
period May 2008 to December 2008.
95
Outlook
The demand for Gas Insulated Products in Middle East
and India is expected to increase in the coming years.
Though the market is showing some signs of slow
down, the demand for the switchgear products are
expected to be stable in Qatar. New Markets in South
Africa, Ghana, Bahrain and Abu Dhabi look promising.
In order to address new markets for MV switchgear, a
series of products launches are planned during the
next two years. While Malaysian plant has already a
proven track record, thrust is being given to penetrate
into Thailand, Vietnam & other African countries to
achieve sustained growth.
2009. The downward trend is expected to continue
during 2009-2010 even as the capital intensive industry
looks to cheaper sources of finance and drop in steel
prices.
In the Conveying Equipment segment, the demand has
been growing from Cement, Mining & Bulk Material
industries since last 2-3 years. However, higher
competition is expected to impact the Company's
traditional product lines going forward. In order to
diversify the product offering, the Company would strive
to expand the business of refurbishment of oilfield
equipment.
B. AUDCO INDIA LIMITED (AIL):
VII. MACHINERY & INDUSTRIAL PRODUCTS
Domestic companies
A. TRACTOR ENGINEERS LIMITED (TENGL):
Subsidiary company
Tractor Engineers Limited (TENGL) is a wholly owned
subsidiary of Larsen & Toubro Limited principally
engaged in manufacture of undercarriage systems for
excavators, crawler tractors, bull dozers etc., and
material handling equipment like apron conveyors,
spares for oil field equipment etc., Customer profile is
largely OEMs in construction and material handling
equipment business.
Operations & Performance
Sales and other income for the financial year under
review were Rs. 167.35 crore as against Rs. 173.31
crore for the previous financial year. Performance for
the year was constrained by cancellation / deferment
of orders from customers due to slowdown in
construction equipment market. Lower capacity
utilisation of the expanded facilities coupled with higher
steel prices prevailing for major part of the year and
higher Interest cost resulted in the Company reporting
a loss of Rs 23.80 crore for the year.
In order to optimise on the cost of operations and
reduce the overhead costs at multiple locations, the
Company has decided to utilise the newly established
Talegaon facility for manufacture of entire range of
products from one location.
Outlook
Indian Hydraulic Excavator market saw a significant
drop in volumes of around 26% during the year 2008-
96
Associate company
AIL is a 50:50 joint venture between L&T and
Flowserve Corporation, USA. AIL is a leading
manufacturer of Industrial Valves and has four
manufacturing plants in Tamlinadu. The Company has
installed state-of-the-art machines in all its plants. AIL
manufactures valves up to 72" size and Class 2500
pressure rating. Besides India, the Industrial Valves
manufactured by AIL have significant presence in major
global markets such as China, France, Japan, Italy,
Singapore, Malaysia, Middle East countries, South
Africa, South Korea, United Kingdom, United States
of America and Russia.
Operations & Performance
Performance during the year was impacted by the
economic downtrend. Many major projects, particularly
in the global markets, were shelved or postponed. As
a result, total income at Rs. 737.71 crore was lower by
14.5% as compared to the previous year. However,
higher rupee realisation on the exports and improved
cost management helped the Company to maintain
the profitability achieved in the previous year.
Outlook
The year 2009-2010 is expected to be a challenging
year. On the positive side, oil & gas projects especially
upstream and pipeline projects in the Middle East are
showing the signs of recovery. In the Indian market,
investments in the power and pipelines segments are
expected to progress; albeit with a delayed schedule.
Considering the current gap in the infrastructure needs,
the recovery in demand is foreseen during the second
half of 2009-2010.
C. L&T-KOMATSU LIMITED (LTK):
Associate company
Overview
LTK is a 50:50 joint venture between Larsen & Toubro
Limited and Komatsu Asia Pacific Pte. Ltd., Singapore,
a wholly owned subsidiary of Komatsu Limited, Japan.
Komatsu is world's largest manufacturer of Hydraulic
Excavators and has manufacturing and marketing
facilities worldwide. LTK is engaged in the manufacture
of Hydraulic Excavators and other associated hydraulic
components. Larsen & Toubro Limited markets and
provides after sales support for Hydraulic Excavators
manufactured by L&T-Komatsu Limited.
The major user segments for Hydraulic Excavators are
general construction, mining & quarrying, Irrigation,
road, granite & marbles etc.
Operations & Performance
Hydraulic Equipment Industry, witnessed contraction
during the year 2008-2009 with market decline of 28%
over the previous year. Liquidity crunch and high cost
of funds coupled with tighter credit sanctioning norms
have discouraged new customers. The decline in
market was sharper during the second half of
2008-2009.
Gross sales at Rs. 1211.02 crore dropped by 19% as
compared to the previous year, though the Company
was able to retain its market share at about 31%, same
as last year. The drop in capacity utilisation coupled
with higher input prices for greater part of the year
impacted the profitability of the Company during the
year. Profit after tax thus dropped to Rs. 19 crore as
against robust achievement of Rs. 133 crore in the
previous year.
Outlook
Difficult year is foreseen for Hydraulic Excavator
industry. The market conditions are expected to be
subdued and construction activity may not pick up
significantly in 2009-2010 in the absence of major
investments. The Company will strive to retain its
market share in the coming challenging year so as to
maximise the capacity utilisation of the current facilities.
D. L&T-CASE EQUIPMENT PRIVATE LIMITED
(LTCEPL):
Associate company
Overview
L&T Case Equipment Private Limited (LTCEPL) is a
50:50 Joint Venture between L&T & CNH America LLC.
The company is engaged in manufacture & marketing
of Construction (Earthmoving) Equipment comprising
Loader Backhoes & Vibratory Compactors. In a highly
competitive Indian market, L&T-Case has a market
share of about 10% in Loader Backhoe and 31% in
Vibratory Compactor. The manufacturing facility is
located at Pithampur, Madhya Pradesh.
Operations & Performance
With the encouraging economic policy for investment
in infrastructure sector, the Construction Equipment
industry had experienced growth momentum in the last
few years. However, due to the global financial crisis
and the consequent slowdown, the domestic market
during the year 2008-2009 declined by 43% for Loader
& by 26% in Vibratory Compactor. Consequently, the
total income of the Company at Rs.336.54 crore
declined by 27% as compared to the previous year.
With significant price pressures prevailing in the
market, coupled with higher input costs, the profit after
tax reduced to Rs.11.16 crore for the year.
Outlook
During the early part of the year 2009, the Construction
Equipment Industry has witnessed marginal recovery
in the demand. While Loader market may remain
subdued due to significant downturn in the realty sector,
the Compactor market may witness marginal growth
in view of the large investments planned in the Roads
sector.
E. EWAC ALLOYS LIMITED (EWAC):
Associate company
EWAC formed in April 1962 is a joint venture with equal
shareholding between Larsen & Toubro Limited and
Messer Eutectic Castolin Group of Germany. EWAC
is a market leader in the business of maintenance &
repairs welding & welding solutions for conservation
of global metal resources. The principal products and
services comprise Maintenance & Repair (M&R)
consumables, specification grade electrodes, flux-
cored welding wires, wear plates/parts, welding and
cutting equipment, Tero Cote Lab services etc. Larsen
& Toubro Limited markets EWAC's products in India
through strong network of stockists.
Operations & Performance
Due to adverse business conditions, the manufacturing
activity showed marked reduction, which resulted in
sharp drop in demand for industrial consumables.
EWAC, therefore, reported only a marginal growth in
97
the total income at Rs. 157 crore (previous year:
Rs.151 crore). Profit after tax at Rs. 20 crore was lower
by 18% as compared to the previous year, mainly due
to higher material cost during the first half of the year
and relatively lower capacity utilisation during the
second half.
In addition to the improved R&D operations, various
initiatives for the cost control measures like product
re-engineering were initiated during the year to reduce
material cost. The Company has also taken initiatives
to improve the existing asset utilisation, implement
energy conservation projects and increase employee
productivity.
Outlook
With the expected improvement in the economic
climate and industrial production in later half of the
financial year 2009-2010, EWAC is optimistic to
perform better in the coming years.
F. L&T-DEMAG PLASTICS MACHINERY LIMITED
(L&T-Demag):
Subsidiary company
The Company was a joint venture between L&T and
Demag Ergotech GmbH, Germany. Effective March
31, 2009, L&T has bought entire equity held by Demag
and hence the venture is now a wholly-owned
subsidiary of Larsen & Toubro Limited. The Company
is in the business of manufacture of Injection Moulding
Machines for the plastics industry and its products find
applications in diverse industries like automobiles,
electrical goods, packaging, personal care products,
writing instruments and white goods.
Operations & Performance
Order inflow and sales declined by 15% & 19%
respectively as compared to the previous year, due to
falling demand. Export dipped mainly due to global
recession affecting many geographical locations.
Company posted a loss of Rs. 6.47 crore for 2008-
2009.
Introduction of cost-effective 'S-Tech series' was a
major step towards achieving cost leadership. In
manufacturing operations, sustained efforts were taken
in areas such as manpower reduction, reduction in
energy consumption and better management of
working capital. The Company continues to enjoy a
position of leadership amongst reputed manufacturers
of Injection Moulding machines in the domestic market
and is a preferred choice for many customers. Going
by the enthusiastic response for the new series
launched during 2008-2009, the company is working
on extending the range to cover medium tonnage
segment as well. Machines developed in-house for
PET application is one more step by the company
towards advancing right technology solution for the
industry.
Outlook
The global slowdown had its toll on the industry
resulting in sluggish off-take of machines during the
year 2008-2009. However, there are early signs of
revival of demand. With no territorial constraints, the
Company expects to improve the export volumes
during the second half of 2009-2010, when the revival
of the global economy is anticipated.
G. VOITH PAPER TECHNOLOGY (INDIA) LIMITED
(VPTIL)
Associate company
Voith Paper Technology (India) Limited (VPTIL) is a
50:50 joint venture formed by L&T and Voith Paper,
Germany. VPTIL provides comprehensive solutions
from fiber to paper, covering the entire paper making
process along with extensive life cycle support. The
JV Company enjoys technological leadership and is
the 'preferred supplier' in the industry. Right from its
inception, the Company has ushered in several new
technologies with "Perfect Fit" solutions for the Indian
Paper Industry.
Operations & Performance
During the year, 2008-2009, VPTIL executed two major
orders for paper making process line package. The
sales revenue during the year was at Rs.10.60 crore
and profit after tax was Rs. 8.60 crore.
Outlook
Even though the Indian Paper Industry is adversely
impacted with the drop in demand and decrease in
realisation, the long term prospects remain quite
positive for this sector. Capacity expansion in the
industry is anticipated given the growing paper
consumption worldwide. With its experience and
expertise, VPTIL is well positioned to sustain the growth
momentum in the medium term.
98
International companies
H. LARSEN & TOUBRO (JIANGSU) VALVE
COMPANY LIMITED (LTJVCL):
Subsidiary company
LTJVCL, a subsidiary of LTIFZE, was set up in
Yancheng City, China, for manufacture of certain
ranges of valves for global markets. The facility is
located in an area of 66,666 Sq Mts., equipped with
the best of the plant and machinery. The manufacturing
practices adopted by the Company reinforce its
commitment to customer satisfaction, employee health,
safety and environmental protection.
Operations & Performance
The factory commenced commercial production of
valves in the last quarter of the year 2007 and the
products have been well received in the market. The
designs for all valves manufactured by LTJVCL are
developed, owned and managed by L&T. These
designs have been addressing the specific needs of
major end users and comply with international emission
norms, besides getting ISO 9001:2000, CE Marking &
ATEX Certification for its products. The valves
manufactured by LTJVCL have been approved by
major customers like SHELL, BP, Chevron, Saudi
Aramco, Alstom, SASOL, Dow Chemical's etc.
In the financial year 2008, its first full year of operations,
LTJVCL recorded revenue of Rs.28.30 crore. Due to
higher initial overhead and marketing costs, the
Company ended the year with a net loss of Rs. 4.20
crore.
Outlook
With the recent accreditation from major customers,
the volume of operations has picked up from the last
quarter of the year 2008. Despite the lack of positive
investment climate in the Oil & Gas sector globally, a
significant trend among the end users is being seen to
consider higher sourcing of valves from China. LTJVCL
is in a favorable position to capitalise on this demand
and the prospects look bright for achieving higher sales
volumes in the year 2009 and beyond.
I.
LARSEN & TOUBRO (QINGDAO) RUBBER
MACHINERY COMPANY LIMITED (LT QINGDAO)
CHINA:
Subsidiary company
LT Qingdao is a joint venture between LTIFZE and
Qingdao Over World Group Company (OWG) with
95:05 shareholdings. LT Qingdao develops and
supplies Tyre Curing Presses and other Rubber
Processing Machinery in line with the quality of
products being presently supplied by L&T to its global
clients.
Operations & Performance
LT Qingdao completed the construction of the new
state-of-the-art factory in October 2008. During the year
the Company recorded revenues aggregating to Rs.
25.80 crore and earned a profit of Rs. 0.24 crore.
Outlook
Some of the International Tyre majors have started
operating in China and a few of them have commenced
procuring their machines from China. Tyre Curing
Presses have been supplied to Pirelli by LT Qingdao
& Rubber Mixing Mills have been exported to tyre
manufacturing companies in India. The competitive
position of LT QINGDAO is expected to improve with
the increase in capacity utilisation.
J. LARSEN & TOUBRO LLC, HOUSTON, USA
(L&T LLC)
Subsidiary company
Larsen & Toubro LLC (L&T LLC), a wholly-owned
Subsidiary of the Company, is based in Houston, USA
and represents L&T for stock and sale of industrial
valves in the North American market.
Operations & Performance
L&T LLC has been successful in securing approvals
of major end-users while forging global alliances and
agreements with key EPC contractors and Oil majors.
The main thrust in Valves business has been on Oil
and Gas segment. During the year 2008, the sales
revenues grew by 36% at Rs.23.90 crore and the net
profit by 54% at Rs. 0.62 crore.
Outlook
The sharp fall in economic activity especially in the
USA and the lower consumption has led to
postponement of investments by the major oil
companies. The consequent emphasis on
refurbishment and the long-term agreements with
some of the oil majors augur well for the Company's
plans in the current year.
99
VIII. LARSEN & TOUBRO INTERNATIONAL FZE
(LTIFZE):
Subsidiary company
LTIFZE, is a wholly owned subsidiary of L&T and is
incorporated as a limited liability company in the
Hamriyah Free Zone, Sharjah. The Company is
engaged in providing strategic support to L&T's growth
aspirations in the Middle East, China and Malaysia.
Apart from owning strategic equipment portfolio
facilitating L&T group's prequalification for construction
contracts in the Middle East, LTIFZE functions as an
investment arm in the country specific Joint Venture
Companies and other strategic entities in the Middle
East, Far East and China.
Operations & Performance
LTIFZE has acquired plant & machinery aggregating
to Rs.176 crore as of December 31, 2008. The
Company has outstanding capital commitment worth
Rs 11 crore for strategic plant & machineries required
for construction and hydrocarbon business sector.
Outlook
Considering the business potential in the Middle East,
LTIFZE is poised to play a crucial role to support L&T's
operations in the region. The Company is positioned
to act as a strategic investment arm of L&T for making
investment overseas and a resource base for critical
plant & equipment to support international business
opportunities.
Countrywise investments in the subsidiary and associate companies by LTIFZE
100
Auditors' report to the members of Larsen & Toubro Limited
We have audited the attached Balance Sheet of Larsen & Toubro Limited, as at March 31, 2009 and also the Profit and Loss Account and the
Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as evaluating the overall financial statements presentation. We believe
that our audit provides a reasonable basis for our opinion.
In accordance with the provisions of section 227 of the Companies Act, 1956, we report that:
(1) As required by the Companies (Auditor's Report) Order, 2003, issued by the central government of India under sub-section (4A) of section
227 of the Companies Act, 1956, and on the basis of such checks of the books and records of the Company as we considered appropriate
and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in
paragraphs 4 and 5 of the said Order.
(2) Further to our comments in the Annexure referred to above, we report that:
(a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes
(b)
(c)
(d)
of our audit;
in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination
of those books;
the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of
account;
in our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956; and
(e) on the basis of the written representations received from directors as on March 31, 2009 and taken on record by the board of directors,
we report that none of the directors is disqualified as on March 31, 2009 from being appointed as a director in terms of clause (g) of
sub-section (1) of section 274 of the Companies Act, 1956.
In our opinion and to the best of our information and according to the explanations given to us, the said accounts, read together with the
significant accounting policies in schedule Q and notes appearing thereon, give the information required by the Companies Act, 1956 in the
manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:
1)
2)
3)
in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2009;
in the case of the Profit and Loss Account, of the profit for the year ended on that date; and
in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.
Mumbai, May 28, 2009
Annexure to the Auditors' report
(Referred to in paragraph (1) of our report of even date)
SHARP AND TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No.15882
1
2
3
(a) The Company is maintaining proper records to show full particulars including quantitative details and situation of all fixed assets.
(b) We are informed that the Company has formulated a programme of physical verification of all the fixed assets over a period of three
years which, in our opinion, is reasonable having regard to the size of the Company and nature of its assets. Accordingly, the physical
verification of the fixed assets has been carried out by management during the year and no material discrepancies were noticed on
such verification.
(c) The Company has not disposed of any substantial part of its fixed assets so as to affect its going concern status.
(a) As explained to us, inventories have been physically verified by management at reasonable intervals during the year. In our opinion,
the frequency of such verification is reasonable.
(b) As per the information given to us, the procedures of physical verification of inventory followed by management are, in our opinion,
reasonable and adequate in relation to the size of the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and
the book records were not material.
(a) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies,
firms and other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, paragraphs
4(iii)(b), (c) and (d) of the order are not applicable.
(b) According to the information and explanations given to us, the Company has not taken any loans, secured or unsecured, from
companies, firms and other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly,
paragraphs 4(iii)(f) and (g) of the order are not applicable.
101
4
5
6
In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business for purchase of inventory, fixed assets and for sale of goods and services.
Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given
to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal
control systems.
(a) According to the information and explanations given to us, we are of the opinion that the particulars of contracts or arrangements that
(b)
need to be entered in the register maintained under section 301 of the Companies Act, 1956 have been so entered.
In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or
arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees
five lakhs in respect of any party during the year, have been made at prices which are reasonable having regard to the prevailing
market prices at the relevant time.
The Company has accepted deposits from the public and in our opinion and according to the information and explanations given to us, the
directives issued by the Reserve Bank of India and the provisions of sections 58A, 58AA and other relevant provisions of the Companies
Act, 1956 and the rules framed thereunder, where applicable, have been complied with. We are informed that no order has been passed by
the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal.
In our opinion, the Company has an internal audit system commensurate with its size and nature of its business.
7
8 We have broadly reviewed the books of account and records maintained by the Company pursuant to the rules prescribed by the central
government for the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 in respect of electronic products, viz.
industrial electronics including all control instrumentation and automation equipment and are of the opinion that prima facie the prescribed
accounts and records have been made and maintained. The contents of these accounts and records have not been examined by us.
(a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the
Company is generally regular in depositing 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, cess and other material
statutory dues as applicable with the appropriate authorities. According to the information and explanations given to us, there were no
undisputed amounts payable in respect of provident fund, investor education and protection fund, employees state insurance, income
tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues outstanding as at March 31, 2009 for a
period of more than six months from the date they became payable.
9
(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of sales
tax, excise duty, service tax and income tax as at March 31, 2009 which have not been deposited on account of a dispute pending, are
as under:
Name of the Statute
Nature of the disputed dues
Amount
Rs.crore*
Period to which the
amount relates
Forum where disputes
are pending
Central Sales Tax Act,
Local Sales Tax Acts and
Works Contract Tax Act
Non-submission of forms,
dispute regarding rate of
tax and other matters
Non-submission of forms,
classification dispute,
disallowance of deemed inter-state
sales and other matters
Non-submission of forms,
additional demand for pending
forms, rate of tax dispute,
disallowance of branch transfer,
and other matters
Non-submission of forms,
disallowance of transit sales,
classification dispute and other
matters
Non-submission of forms,
additional demand for pending
forms, disallowance of inter-state
sales and other matters
Non-submission of forms, dispute
related to sales in transit
and other matters
Non-submission of forms,
inter-state sales, sub-contractors
turnover, rate dispute,
disallowance under composition
scheme and other matters
Inter-state sales, classification
dispute, and disallowance of
deemed sales in course of
0.48
36.85
1997-1998 to 2001-2002,
2004-2005 and
2005-2006
1992-1993,
1996-1997 to 2005-2006
Commercial Tax Officer
Assistant Commissioner
(Appeals)
10.30
1989-1990, 1991-1992,
1994-1995 to 1998-1999
and 2000-2001 to 2005-2006
Deputy Commissioner
(Appeals)
7.00
1991-1992 to 1994-1995,
and 1996-1997 to 2004-2005 (Appeals)
Joint Commissioner
2.99
2000-2001 to 2005-2006
Additional Commissioner
(Appeals)
1.71
2003-2004 and
2005-2006
Commissioner (Appeals)
114.93
1987-1988 to 1992-1993
1994-1995 to 2003-2004
and 2005-2006
Sales Tax Tribunal
144.10
1986-1987 to 2005-2006
High Court
102
Name of the Statute
Nature of the disputed dues
Amount
Rs.crore*
Period to which the
amount relates
Forum where disputes
are pending
imports and taxability of
subcontractors turnover
Dispute regarding taxability of
declared goods, arbitrary
enhancement and other matters
The Central Excise Act,
1944 and Service Tax
under the Finance Act, 1994
Classification dispute,
exemptions denied, valuation
disputes and other matters
Export rebate claim
Dispute on site mix concrete
and PSC grinders
Cenvat credit against service
tax on freight outward disallowed
Demand for service tax on
lumpsum turnkey projects and
demand for service tax treating
"commercial or industrial
construction services"
Service tax on commercial
construction services
Dispute regarding tax deducted
at source at lower rate on
maintenance charges
Difference in rate of tax
deducted at source
The Income Tax Act, 1961
5.57
1991-1992, 1995-1996,
1997-1998,
1999-2000 to 2001-2002
and 2003-2004
Supreme Court
8.86
0.07
0.27
1991-1992,
2001-2002 to 2003-2004
and 2005-2006
2003-2004
1997-1998
CESTAT
High Court
Supreme Court
0.10
2007-2008
Commissioner (Appeals)
171.44
2002-2003 to 2008-2009
CESTAT
4.04
2005-2006
High Court
0.03
2005-2006
Commissioner (Appeals)
1.56
2007-2008 and 2008-2009 Director of Income Tax
(International Taxation)
*Net of pre-deposit paid in getting the stay/appeal admitted
10 The Company has no accumulated losses as at March 31, 2009 and it has not incurred any cash losses in the financial year ended on that
date or in the immediately preceding financial year.
11 According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture holders as at the balance sheet date.
12 According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
13 The provisions of any special statute applicable to chit fund/nidhi/mutual benefit fund/societies are not applicable to the Company.
14
In our opinion and according to the information and explanations given to us, the Company is not a dealer or trader in securities. The
Company has invested surplus funds in marketable securities and mutual funds. According to the information and explanations given to us,
proper records have been maintained of the transactions and contracts and timely entries have been made therein. The investments in
marketable securities and mutual funds have been held by the Company in its own name.
In our opinion and according to the information and explanations given to us, the terms and conditions of guarantees given by the Company
for loans taken by others from banks or financial institutions are not prima facie prejudicial to the interests of the Company.
In our opinion and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the
purposes for which they were obtained.
15
16
17 According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report
that no funds raised on short term basis have been used for long term investments.
18 The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section
301 of the Companies Act, 1956 during the year.
19 According to the information and explanations given to us and the records examined by us, security or charge has been created in respect
of the debentures issued.
20 The Company has not raised any money by public issues during the year.
21 During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and explanations given to us, we have neither come across any instances of
material fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by management.
Mumbai, May 28, 2009
SHARP AND TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No.15882
103
Balance Sheet as at March 31, 2009
Schedule
Rs.crore
Rs.crore
Rs.crore
Rs.crore
As at 31-3-2009
As at 31-3-2008
SOURCES OF FUNDS:
SHAREHOLDERS’ FUNDS:
Share capital
Reserves and surplus
Employee stock options outstanding
(previous year: Rs.279.67 crore)
Less: Deferred employee compensation expense
(previous year: Rs.165.28 crore)
LOAN FUNDS:
Secured loans
Unsecured loans
Deferred tax liabilities [see note no.21]
TOTAL
APPLICATION OF FUNDS:
Fixed assets:
Tangible assets
Gross block
Less: Depreciation and impairment
Net block
Less: Lease adjustment
Capital work-in-progress
Intangible assets
Gross block
Less: Amortisation and impairment
Net block
Capital work-in-progress
Investments
Deferred tax assets [see note no.21]
Current assets, loans and advances:
Interest accrued on investments
Inventories
Sundry debtors
Cash and bank balances
Loans and advances
Less: Current liabilities and provisions:
Liabilities
Provisions
Net current assets
Miscellaneous expenditure
(to the extent not written-off or adjusted)
TOTAL
469.95
234.29
117.14
12106.89
235.66
1102.38
5453.65
5434.18
1418.32
4015.86
3.07
4012.79
1040.99
156.32
54.79
101.53
39.29
21.56
5805.05
10055.52
775.29
6790.60
23448.02
14775.88
3066.53
17842.41
A
B
C
D
E (i)
E (ii)
F
G
H
I
CONTINGENT LIABILITIES
SIGNIFICANT ACCOUNTING POLICIES
(For notes forming part of the accounts see page nos.136 to 171)
J
Q
12459.69
6556.03
435.16
19450.88
5053.78
140.82
8263.72
386.69
9555.08
3583.95
244.33
13383.36
3553.43
92.01
6922.26
182.96
58.47
9382.22
114.39
308.53
3275.42
4096.90
1239.40
2857.50
3.07
2854.43
699.00
108.85
47.11
61.74
30.27
14.32
4305.91
7365.01
964.46
3757.08
16406.78
11741.72
2035.42
13777.14
5605.61
0.26
19450.88
2629.64
3.06
13383.36
As per our report attached
SHARP & TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No.15882
Mumbai, May 28, 2009
104
A. M. NAIK
Chairman & Managing Director
Y. M. DEOSTHALEE
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
BHAGYAM RAMANI
A. K. JAIN
N. HARIHARAN
Company Secretary
Directors
Mumbai, May 28, 2009
Profit and Loss Account for the year ended March 31, 2009
Schedule
Rs.crore
Rs.crore
Rs.crore
Rs.crore
2008-2009
2007-2008
K
L (i)
L (ii)
M
N
O
P
INCOME:
Sales & service (gross)
Less: Excise duty
Sales & service (net)
Other operational income
Other income
EXPENDITURE:
Manufacturing, construction and operating expenses
Staff expenses
Sales, administration and other expenses
Interest expenses and brokerage
Depreciation, obsolescence of tangible assets
Amortisation of intangible assets
Less: Overheads charged to fixed assets
Profit before transfer from revaluation reserve
Add: Transfer from revaluation reserve
Profit before tax
Provision for current taxes [see note no.20]
Provision for deferred tax [see note no.21]
Provision for tax on fringe benefits [see note no.20(iv)]
Profit after tax
Gain/(loss) on extraordinary items (net of tax) [see note no.10]
Profit after tax after extraordinary items
Add: Balance brought forward from previous year
Less: Dividend paid for previous year
Additional tax on dividend paid for previous year
Profit available for appropriation
Less: Transfer to general reserve
Transfer to debenture redemption reserve
Profit available for distribution
Interim dividend
Proposed final dividend
Additional tax on dividend
Balance carried to Balance Sheet
Basic earnings per equity share before
extraordinary items (Rupees)
Diluted earnings per equity share before
extraordinary items (Rupees)
Basic earnings per equity share after
[see note no.22]
extraordinary items (Rupees)
Diluted earnings per equity share after
extraordinary items (Rupees)
Face value per equity share (Rupees)
SIGNIFICANT ACCOUNTING POLICIES
(For notes forming part of the accounts see page nos.136 to 171)
Q
}
34045.04
398.47
25187.48
332.78
26232.01
1998.02
1863.98
350.22
286.14
21.16
30751.53
24.48
1167.03
10.44
53.74
104.31
0.28
0.05
33646.57
279.80
739.78
34666.15
30727.05
3939.10
1.31
3940.41
1231.21
2709.20
772.46
3481.66
103.98
3585.64
2725.00
43.34
817.30
–
614.97
101.83
100.50
46.30
45.68
59.50
58.70
2.00
19154.00
1535.45
1362.04
122.66
197.97
15.66
22387.78
11.42
892.79
19.95
69.31
78.24
0.66
0.11
24854.70
154.73
520.37
25529.80
22376.36
3153.44
2.03
3155.47
982.05
2173.42
–
2173.42
77.47
2250.89
1575.00
–
675.89
56.83
438.49
76.26
104.31
37.80
36.38
37.80
36.38
2.00
As per our report attached
SHARP & TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No.15882
Mumbai, May 28, 2009
A. M. NAIK
Chairman & Managing Director
Y. M. DEOSTHALEE
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
BHAGYAM RAMANI
A. K. JAIN
N. HARIHARAN
Company Secretary
Directors
Mumbai, May 28, 2009
105
Cash Flow Statement for the year ended March 31, 2009
2008-2009
Rs.crore
2007-2008
Rs.crore
Cash flow from operating activities:
Profit before tax (excluding extraordinary items)
Adjustments for:
Dividend received
Depreciation (including obsolescence), amortisation and impairment
Exchange difference on items grouped under financing activity
Interest expense
Interest income
Profit on sale of fixed assets (net)
Profit on sale of investments (net)
Employee stock option - discount forming part of staff expenses
Provision for diminution in value of investments
Operating profit before working capital changes
Adjustments for:
(Increase)/Decrease in trade and other receivables
(Increase)/Decrease in inventories
(Increase)/Decrease in miscellaneous expenditure
Increase/(Decrease) in trade payables and customer advances
Cash generated from operations
Direct taxes refund/(paid) - [net]
Net cash from operating activities
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
Cash flow from investing activities:
...
Purchase of fixed assets
...
Sale of fixed assets
...
Investment in subsidiaries, associates and joint ventures
...
Divestment of stake in subsidiaries, associates and joint ventures
...
Purchase of long term investments
...
Sale of long term investments
(Purchase)/sale of current investments (net)
...
Loans/deposits made with subsidiaries, associates companies and third parties (net)
...
...
Advance towards equity commitment
...
...
Interest received
...
...
Dividend received from subsidiaries
...
Dividend received from other investments
...
Cash (used in)/from investing activities (before extraordinary items)
...
Extraordinary items
Cash received (net of expenses) on sale/transfer of
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
Ready Mix Concrete business (net of tax of Rs.279.37 crore)
...
Cash & cash equivalents discharged pursuant to disposal of Ready Mix Concrete business ...
...
Net cash (used in)/from investing activities (after extraordinary items)
...
...
...
A.
B.
C.
Cash flow from financing activities:
Proceeds from fresh issue of share capital including shares under ESOP schemes
...
Proceeds from long term borrowings
...
Repayment of long term borrowings
...
(Repayments)/proceeds from other borrowings (net)
...
Loans from subsidiary and associate companies (net of repayments)
...
Dividends paid
...
Additional tax on dividend
...
Interest paid
...
Net cash (used in)/from financing activities
...
...
...
Net (decrease)/increase in cash and cash equivalents (A + B + C)
Cash and cash equivalents at beginning of the year
Cash and cash equivalents at end of the year
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
3940.41
(334.63)
305.99
238.18
350.22
(171.82)
(4.78)
(94.66)
163.31
8.12
4400.34
(2888.35)
(1519.59)
2.80
2356.49
2351.69
(873.12)
1478.57
(2029.63)
49.81
(1749.04)
1201.20
(176.44)
195.86
(510.48)
(1251.77)
(623.59)
129.77
15.80
318.84
(4429.67)
1121.37
(0.23)
(3308.53)
23.04
2574.29
(16.69)
(201.13)
4.10
(438.77)
(66.65)
(237.40)
1640.79
(189.17)
964.46
775.29
3155.47
(185.55)
211.60
138.30
122.66
(84.48)
(6.92)
(157.09)
91.86
24.42
3310.27
(2418.51)
(1304.76)
6.78
3339.79
2933.57
(988.33)
1945.24
(1700.28)
78.16
(1042.53)
9.58
(6.85)
347.83
(3140.66)
43.56
(66.35)
96.68
0.33
138.64
(5241.89)
–
–
(5241.89)
1701.58
1735.62
(52.54)
10.34
(19.47)
(114.14)
(19.40)
(75.31)
3166.68
(129.97)
1094.43
964.46
Notes:
1. Cash Flow statement has been prepared under the indirect method as set out in the Accounting Standard (AS) 3 “Cash Flow Statements” as specified in the Companies
(Accounting Standards) Rules, 2006.
2. Purchase of fixed assets includes movement of capital work-in-progress during the year.
3. Cash and cash equivalents at the end of the year represent cash and bank balances and include unrealised gain of Rs.23.77 crore (previous year unrealised gain of
Rs.0.42 crore) on account of translation of foreign currency bank balances.
4. For cash and cash equivalents not available for immediate use as on the Balance Sheet date, see note no.5(a) and 5(c) of notes forming part of accounts.
5. Previous year’s figures have been regrouped/reclassified wherever applicable.
As per our report attached
SHARP & TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No.15882
Mumbai, May 28, 2009
106
A. M. NAIK
Chairman & Managing Director
Y. M. DEOSTHALEE
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
BHAGYAM RAMANI
A. K. JAIN
N. HARIHARAN
Company Secretary
Directors
Mumbai, May 28, 2009
Schedules forming part of the Accounts
Schedule A
Share capital:
Authorised:
1,62,50,00,000 equity shares of Rs.2 each
(previous year: 1,62,50,00,000 equity shares of Rs.2 each)
Issued:
58,56,87,862 equity shares of Rs.2 each
(previous year: 29,23,27,390 equity shares of Rs.2 each)
Subscribed and paid up:
58,56,87,862 equity shares of Rs.2 each [see note no.1]
(previous year: 29,23,27,390 equity shares of Rs.2 each)
Schedule B
Reserves and surplus:
Revaluation reserve:
As per last Balance Sheet
Less: Transferred to Profit and Loss Account
Capital redemption reserve:
As per last Balance Sheet
Less: Utilised for issue of bonus shares
Capital reserve
Debenture redemption reserve
Created during the year
Securities premium account:
As per last Balance Sheet
Addition during the year
Less: Utilised for issue of bonus shares
Share issue expenses
(Reversal)/write-back of provision made in previous year
Foreign projects reserve:
As per last Balance Sheet
Less: Transferred to general reserve
Housing projects reserve:
As per last Balance Sheet
Less: Transferred to general reserve
Carried forward
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
325.00
117.14
117.14
117.14
325.00
58.47
58.47
58.47
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
25.90
1.31
0.02
0.02
4187.25
69.62
4256.87
58.50
–
(0.92)
10.83
3.00
3.98
2.25
25.90
0.02
10.52
–
24.59
–
10.52
43.34
27.93
2.03
0.02
–
2064.35
2135.14
4199.49
–
14.64
(2.40)
4199.29
4187.25
19.19
8.36
7.96
3.98
7.83
1.73
4287.30
10.83
3.98
4238.50
107
Schedules forming part of the Accounts (contd.)
Schedule B (contd.)
Brought forward
Hedging reserve (net of tax):
Created during the year
General reserve:
As per last Balance Sheet
Add: Transferred from:
Foreign projects reserve
Housing projects reserve
Profit and Loss Account
Profit and Loss Account
Schedule C
Secured loans:
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
5039.41
3.00
2.25
2725.00
4287.30
(50.57)
7769.66
100.50
12106.89
3452.07
8.36
3.98
1575.00
4238.50
–
5039.41
104.31
9382.22
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Redeemable non-convertible fixed rate debentures
900.00
–
Loans from banks:
Cash credits/working capital demand loans
Other loans
Schedule D
Unsecured loans:
Redeemable non-convertible fixed rate debentures
Loans from subsidiary companies
Short term loans and advances:
From banks
Lease finance
Sales tax deferment loan
Other loans and advances:
From banks
Lease finance
Sales tax deferment loan
From others
108
202.38
–
308.46
0.07
202.38
1102.38
308.53
308.53
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
873.36
20.90
18.89
3974.60
125.36
101.14
85.00
250.00
4.40
–
8.50
664.92
0.43
15.16
913.15
680.51
2380.04
0.27
121.10
85.00
4286.10
5453.65
2586.41
3275.42
Schedules forming part of the Accounts (contd.)
Schedule E (i)
Fixed assets: Tangible
Particulars
OWNED ASSETS:
Land-freehold
Ships
Buildings
Railway sidings
Plant and machinery
Furniture and fixtures
Vehicles
Aircraft
Owned assets leased out:
Buildings
Plant and machinery
Lease adjustment
As at
1-4-2008
116.87
14.34
936.96
0.25
Cost/valuation
Depreciation
Impairment
Book value
Additions Deductions
As at
31-3-2009
Up to
31-3-2008
For the
year Deductions
Up to
31-3-2009
As at
31-3-2009
As at
31-3-2009
As at
31-3-2008
Rs.crore
26.91
39.21
194.38
–
6.21
–
137.57
53.55
–
1.71
1.61
1129.73
164.83
–
0.25
0.25
2745.59
1105.94
213.40
3638.13
937.00
124.73
74.29
9.26
44.29
27.44
–
23.66
37.26
3.91
10.36
–
–
–
–
–
–
–
–
144.48
101.19
9.26
44.29
27.44
–
61.74
42.95
7.48
4.50
9.78
–
–
1.70
26.09
–
232.16
13.90
7.94
0.50
0.64
0.35
–
–
–
–
3.41
0.29
190.63
–
0.25
92.80
1076.36
3.40
8.71
–
–
–
–
72.24
42.18
7.98
5.14
10.13
–
–
–
–
–
–
–
–
–
–
6.93
–
137.57
50.14
939.10
–
116.87
12.63
772.13
–
2561.77
1808.59
72.24
59.01
1.28
39.15
10.38
(3.07)
62.99
31.34
1.78
39.79
10.73
(3.07)
Owned assets (sub total - A)
4094.02
1427.36
235.49
5285.89
1230.24
283.28
105.20
1408.32
6.93
3867.57
2853.78
LEASED ASSETS:
Assets taken on finance lease:
Plant and machinery
Vehicles
Assets taken on lease (sub total - B)
TOTAL (A+B)
Previous year
Add: Capital work-in-progress
Schedule E (ii)
Fixed assets: Intangible
Particulars
Land-leasehold
Specialised softwares
Lump sum fees for technical knowhow
TOTAL
Previous year
Add: Capital work-in-progress
1.86
1.02
2.88
144.98
1.11
146.09
0.57
0.11
0.68
146.27
2.02
148.29
1.22
1.01
2.23
1.46
0.03
1.49
0.54
0.11
0.65
2.14
0.93
3.07
4096.90
1573.45
236.17
5434.18
1232.47
284.77
105.85
1411.39
2795.32
1353.90
52.32
4096.90
1080.06
195.85
43.44
1232.47
–
–
–
6.93
6.93
144.13
1.09
145.22
0.64
0.01
0.65
4012.79
2854.43
1040.99
699.00
5053.78
3553.43
Cost/valuation
Amortisation
Rs.crore
Book value
As at
1-4-2008
44.07
49.58
15.20
108.85
80.98
Additions
Deductions
As at
31-3-2009
Up to
31-3-2008
16.52
45.33
–
61.85
35.25
0.97
12.84
0.57
14.38
7.38
59.62
82.07
14.63
156.32
108.85
4.67
33.88
8.56
47.11
32.77
For the
year
0.57
16.36
4.23
21.16
15.66
Deductions
Up to
31-3-2009
As at
31-3-2009
As at
31-3-2008
0.05
12.85
0.58
13.48
1.32
5.19
37.39
12.21
54.79
47.11
54.43
44.68
2.42
101.53
39.29
140.82
39.40
15.70
6.64
61.74
30.27
92.01
109
Schedules forming part of the Accounts (contd.)
Schedule E (contd.)
Notes:
Schedule E (i) - Tangible assets
1
2
Cost/valuation of freehold land includes Rs.19.42 crore for which conveyance is yet to be completed.
Cost/valuation of buildings includes ownership accommodation:
(i)
(a)
in various co-operative societies and apartments and shop-owners’ associations: Rs.95.73 crore, including 2320 shares of Rs.50
each, 207 shares of Rs.100 each and 1 share of Rs.250.
in proposed co-operative societies Rs.17.29 crore.
(b)
of Rs.4.39 crore in respect of which the deed of conveyance is yet to be executed.
(ii)
(iii) of Rs.8.45 crore representing undivided share in a property at a certain location.
3
4
5
6
7
Additions during the year and capital work-in-progress include Rs.6.17 crore being borrowing cost capitalised in accordance with Accounting
Standard (AS)16 on “Borrowing Costs” as specified in the Companies (Accounting Standards) Rules, 2006.
Depreciation for the year include obsolescence Rs.1.37 crore (previous year: Rs.2.12 crore).
Capital work-in-progress includes advances Rs.103.76 crore (previous year: Rs.119.02 crore).
The Company had revalued as at October 1,1984 some of its land, buildings, plant and machinery and railway sidings at replacement/
market value which resulted in a net increase of Rs.108.05 crore.
Owned assets given on operating lease have been presented separately in the schedule as per Accounting Standard (AS) 19.
Schedule E (ii) - Intangible assets
1
Cost/valuation of leasehold land includes Rs.2.63 crore for land taken at Mysore on lease from KIADB vide agreement dated May 5, 2006.
The lease agreement is for a period of 6 years with extension of 3 years, at the end of which sale deed would be executed, on fulfilment of
certain conditions by the Company.
Capital work-in-progress includes advances Rs.nil (previous year: Rs.1.40 crore).
2
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Schedule F
Investments (at cost unless otherwise specified):
(A) Long term investments:
(i) Government and trust securities
(ii) Subsidiary companies:
(a) Fully paid equity shares
(b) Partly paid equity shares
(c) Fully paid preference shares
(d) Application money for equity shares
(iii) Fully paid equity shares - trade investments:
(a) Fully paid equity shares in associate companies
(b) Fully paid equity shares in incorporated joint ventures
(c) Fully paid equity shares in other companies
(iv) Other fully paid equity shares
(v) Bonds
Carried forward
110
–
1776.72
90.12
9.42
1076.54
2952.80
79.40
–
25.35
104.75
198.24
0.50
5.91
2154.49
73.93
9.42
–
2237.84
79.40
3.00
25.35
107.75
21.80
190.46
3256.29
3256.29
2563.76
2563.76
Schedules forming part of the Accounts (contd.)
Schedule F (contd.)
Brought forward
(B) Current investments:
(i) Government and trust securities
(ii) Bonds
(iii) Certificate of deposits
(iv) Commercial paper
(v) Mutual funds
(C)
Investment in integrated joint ventures
Particulars
Quoted investments
Book value
Market value
Unquoted investments
Book value
Details of investments:
Particulars
All unquoted unless otherwise specified
A) Long term investments:
(i) Government and trust securities:
8.07% Government of India bond 2017 of
Rs.5 crore (quoted)
Government and trust securities - total
(ii) Subsidiary companies:
(a) Fully paid equity shares:
Bhilai Power Supply Company Limited
Hi-Tech Rock Products & Aggregates Limited
India Infrastructure Developers Limited
[see note no.35]
International Seaport Dredging Limited
International Seaports Pte. Limited
L&T - Gulf Private Limited
L&T Ahmedabad-Maliya Tollway Private Limited
L&T Capital Company Limited
L&T Capital Holdings Limited
L&T Chennai-Tada Tollway Limited
(Rs.1000; previous year: Rs.nil)
L&T Concrete Private Limited
Carried forward
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
3256.29
2563.76
–
254.09
1261.46
95.52
3268.60
174.65
57.35
–
–
4050.65
4879.67
127.76
8263.72
4282.65
75.85
6922.26
As at
As at
31-3-2009 31-3-2008
Rs.crore
Rs.crore
470.68
279.44
1258.81
1403.92
7793.04
6642.82
Face value
per unit
Rupees
Number of units
As at
1-4-2008
Purchased/
Sold
subscribed during the year
As at
31-3-2009
during the year
As at
31-3-2009
Rs.crore
As at
31-3-2008
Rs.crore
5,00,00,000
1
10
10
10
49,950
50,000
5,60,60,000
–
–
–
–
10,000
USD 1
10
10
10
10
10
28,816
18,15,000
10,000
–
50,00,000
–
–
1,989
–
12,40,005
10,10,000
1,70,00,000
20,50,000
100
10
10,000
–
1
–
–
–
5,60,60,000
–
–
–
–
–
205
–
–
49,950
50,000
–
30,805
18,15,000
12,50,005
10,10,000
2,20,00,000
20,49,795
100
10,000
–
–
0.05
0.05
–
30.81
2.36
1.25
1.01
22.00
2.05
–
0.01
59.59
5.91
5.91
0.05
0.05
56.06
28.82
2.36
0.01
–
5.00
–
–
0.01
92.36
111
Schedules forming part of the Accounts (contd.)
Schedule F-Details of investments (contd.)
Particulars
Face value
per unit
Rupees
Number of units
As at
1-4-2008
Purchased/
Sold
subscribed during the year
As at
31-3-2009
during the year
As at
31-3-2009
Rs.crore
As at
31-3-2008
Rs.crore
–
18,66,91,500
–
10,000
19,30,31,352
50,00,00,000
10,000
–
10,10,000
–
–
–
–
18,66,91,500
–
–
–
50,00,00,000
10,000
–
10,10,000
10,000
19,30,31,352
–
Fully paid equity shares of Subsidiary companies (contd.)
Brought forward
L&T Engserve Private Limited
L&T Finance Limited [see note no.35]
L&T Halol-Shamlaji Tollway Private Limited
L&T Infra & Property Development Private Limited
L&T Infrastructure Development Projects Limited
L&T Infrastructure Finance Company Limited
[see note no.35]
L&T Natural Resources Limited
L&T Power Development Limited
L&T Power Limited
(Previously known as L&T Power Projects Limited)
L&T Rajkot-Vadinar Tollway Private Limited
L&T Realty Private Limited
L&T Seawoods Private Limited
L&T Shipbuilding Limited
L&T Strategic Management Limited
L&T Transco Private Limited
L&T Transportation Infrastructure Limited
L&T Western India Tollbridge Limited
L&T-Demag Plastics Machinery Private Limited
(prior to March 31, 2009, incorporated joint venture)
L&T-Sargent & Lundy Limited
L&T-Valdel Engineering Limited
Larsen & Toubro Infotech Limited
Larsen & Toubro International FZE
Larsen & Toubro LLC
Narmada Infrastructure Construction Enterprise Limited
L&T PNG Tollway Private Limited
(Rs.26000, previous year: Rs.Nil)
Raykal Aluminum Private Limited
Spectrum Infotech Private Limited
Tractor Engineers Limited
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
5
Dhs 5,50,500
USD 1
10
10
10
10
1,000
–
2,90,00,000
1,05,01,000
–
4,71,60,700
–
50,000
50,000
10,000
1,08,64,000
1,39,50,007
30,00,000
27,52,129
12,44,500
3,00,00,000
830
50,000
1,26,48,507
–
–
4,40,000
68,000
50,000
5,70,00,000
4,08,00,000
10,10,000
–
10,000
–
–
–
–
–
1,30,00,000
–
–
–
862
–
–
2,600
40,000
–
–
Less: Provision for diminution in value
Total (ii)(a)
(b) Partly paid equity shares: [see note no.13]
L&T Infrastructure Development Projects Limited
(Re.1 per share paid up)
Larsen & Toubro Infotech Limited
Rs.3.75 per share paid up (Re.0.55 paid during the year)
Total (ii)(b)
(c) Fully paid preference shares:
10
5
67,69,518
22,50,000
International Seaport Dredging Limited - 13% preference shares
Total (ii)(c)
10,000
9,420
(d) Application money for equity shares:
L&T Capital Holdings Limited
Total (ii)(d)
Subsidiary companies - total
112
–
–
–
–
–
–
59.59
0.01
–
1.01
0.01
383.42
–
0.05
86.00
51.30
1.01
47.16
0.01
0.05
0.05
0.01
10.86
13.95
13.00
1.53
25.22
15.00
1049.82
0.23
12.65
–
0.04
6.80
0.30
1779.08
2.36
1776.72
0.68
89.44
90.12
9.42
9.42
1076.54
1076.54
2952.80
92.36
–
490.98
–
0.01
383.42
500.00
–
29.00
10.50
–
47.16
–
0.05
0.05
0.01
10.86
13.95
–
1.53
25.22
15.00
516.77
0.23
12.65
–
–
6.80
0.30
2156.85
2.36
2154.49
0.68
73.25
73.93
9.42
9.42
–
–
2237.84
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
50,000
8,60,00,000
5,13,01,000
10,10,000
4,71,60,700
10,000
50,000
50,000
10,000
1,08,64,000
1,39,50,007
1,60,00,000
27,52,129
12,44,500
3,00,00,000
1,692
50,000
1,26,48,507
2,600
40,000
4,40,000
68,000
67,69,518
22,50,000
9,420
–
Schedules forming part of the Accounts (contd.)
Schedule F-Details of investments (contd.)
Particulars
Face value
per unit
Rupees
Number of units
As at
1-4-2008
Purchased/
Sold
subscribed during the year
As at
31-3-2009
during the year
As at
31-3-2009
Rs.crore
As at
31-3-2008
Rs.crore
(iii) Fully paid equity shares - trade investments:
(a) Fully paid equity shares in associate companies:
Audco India Limited
EWAC Alloys Limited
Gujarat Leather Industries Limited
L&T-Case Equipment Private Limited
L&T-Chiyoda Limited
L&T-Komatsu Limited
L&T-Ramboll Consulting Engineers Limited
Voith Paper Technology (India) Limited
Less: Provision for diminution in value
Total (iii)(a)
(b) Fully paid equity shares in incorporated joint ventures:
L&T-Demag Plastics Machinery Private Limited
(subsidiary w.e.f. March 31, 2009)
Total (iii)(b)
(c) Fully paid equity shares in other companies:
City Union Bank Limited (quoted)
Total (iii)(c)
Fully paid equity shares - trade investments - total
(iv) Other fully paid equity shares:
John Deere Equipment Private Limited
Satyam Computer Services Limited (quoted)
[see note no.34(f)]
Tidel Park Limited
UltraTech Cement Limited (quoted)
Utmal Multi-purpose Service Co-operative Society Limited
[B Class] (Rs.30,000; previous year: Rs.30,000)
Other fully paid equity shares - total
(v) Bonds:
5.25% Rural Electrification Corporation Limited -
capital gain bonds
5.50% National Highway Authority of India -
capital gain bonds
5.50% Small Industries Development Bank
of India-capital gain bonds
5.65% National Highway Authority of India -
capital gain bonds
6.75% Unit Trust of India-tax free bonds (quoted)
Bonds - total
Long term investments - total
100
100
10
10
10
10
10
10
9,00,000
4,14,720
7,35,000
1,20,05,000
45,00,000
6,00,00,000
18,00,000
15,00,000
10
30,00,000
1
1,50,00,000
35,00,000
–
5,09,19,964
10
2
10
10
100
40,00,000
1,43,03,294
300
0.06
0.04
0.56
12.00
4.50
60.00
1.80
1.00
79.96
0.56
79.40
–
–
25.35
25.35
104.75
3.50
176.44
4.00
14.30
–
198.24
–
–
–
–
–
–
–
–
9,00,000
4,14,720
7,35,000
1,20,05,000
45,00,000
6,00,00,000
18,00,000
15,00,000
30,00,000
–
1,50,00,000
35,00,000
5,09,19,964
40,00,000
1,43,03,294
300
–
–
–
–
–
–
–
10,000
500
10,000
85,000
10,000
53,000
10,000
100
50,000
1,96,400
500
0.50
85,000
53,000
50,000
1,96,400
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
0.06
0.04
0.56
12.00
4.50
60.00
1.80
1.00
79.96
0.56
79.40
3.00
3.00
25.35
25.35
107.75
3.50
–
4.00
14.30
–
21.80
0.50
85.00
53.00
50.00
1.96
0.50
3256.29
190.46
2563.76
113
Schedules forming part of the Accounts (contd.)
Schedule F-Details of investments (contd.)
Particulars
B) Current investments:
(i) Government and trust securities:
5.87% Government of India bond 2010 (quoted)
7.99% Government of India bond 2017 (quoted)
8.33% Government of India bond 2036 (quoted)
8.35% Government of India bond 2022 (quoted)
Less: Provision for diminution in value
Government and trust securities - total
(ii) Bonds:
Face value
per unit
Rupees
5,00,00,000
5,00,00,000
5,00,00,000
5,00,00,000
11.25% Gujarat Urja Vikas Nigam Limited bonds 2009
40,000
(quoted) [face value reduced by Rs.30,000 from Rs.70,000]
7.65% HDFC bonds 2016 (quoted)
8.00% HDFC bonds 2017 (quoted)
9.50% HDFC bonds 2013 (quoted)
8.45% Indian Railway Finance Corporation 2018 (quoted)
10.60% Indian Railway Finance Corporation 2018 (quoted)
8.55% Indian Railway Finance Corporation 2019 (quoted)
8.00% Indian Overseas Bank 2016 bonds (quoted)
India Infrastructure Finance Company Limited (quoted)
11.25% Power Finance Corporation
bonds 2018-C series (quoted)
8.65% Rural Electrification Corporation Limited
bonds 2011 (quoted)
10.85% Rural Electrification Corporation Limited
bonds 2018 (quoted)
10.85% Rural Electrification Corporation Limited
bonds 2018 (quoted)
Less: Provision for diminution in value
Bonds - total
(iii) Certificate of deposits:
Bank of Baroda-7.08%, 15 Jan 2010
Bank of Baroda-7.10%, 15 Jan 2010
Canara Bank-6.75%, 12 Feb 2010
Canara Bank-6.98%, 15 Jan 2010
Canara Bank-7.59%, 23 Mar 2010
Corporation Bank-7.25%, 06 Jan 2010
Oriental Bank of Commerce-7.00%, 01 Jan 2010
Oriental Bank of Commerce-7.30%, 15 Jan 2010
Oriental Bank of Commerce-7.39%, 08 Jan 2010
Punjab National Bank-6.50%, 12 May 2009
Punjab National Bank-6.95%, 14 Dec 2009
Punjab National Bank-13.5%, 02 Apr 2009
Punjab National Bank-6.74%, 15 Jan 2010
Punjab National Bank-6.75%, 04 Feb 2010
Carried forward
114
10,00,000
10,00,000
10,00,000
10,00,000
10,00,000
10,00,000
10,00,000
1,00,000
10,00,000
10,00,000
10,00,000
10,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
Number of units
As at
1-4-2008
Purchased/
Sold
subscribed during the year
As at
31-3-2009
during the year
As at
31-3-2009
Rs.crore
As at
31-3-2008
Rs.crore
5
20
7
3
11
90
210
250
–
–
–
50
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
500
500
50
–
2,500
5,150
600
290
50
3,500
1,500
5,000
10,000
20,000
30,000
5,000
5,000
5,000
2,500
5,000
500
2,500
2,500
5
20
7
3
–
90
210
250
–
–
–
–
–
4,450
400
190
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
11
–
–
–
500
500
50
50
2,500
700
200
100
50
3,500
1,500
5,000
10,000
20,000
30,000
5,000
5,000
5,000
2,500
5,000
500
2,500
2,500
–
–
–
–
–
–
–
0.04
–
–
–
50.02
57.00
5.00
4.90
25.00
80.51
19.96
10.34
5.68
258.45
4.36
254.09
32.72
14.02
46.90
93.49
185.89
280.34
46.85
47.21
46.57
24.79
47.03
4.73
23.58
23.50
917.62
24.10
102.35
36.90
15.32
178.67
4.02
174.65
0.07
8.56
20.67
25.00
–
–
–
4.90
–
–
–
–
–
59.20
1.85
57.35
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Schedules forming part of the Accounts (contd.)
Schedule F-Details of investments (contd.)
Particulars
Face value
per unit
Rupees
Number of units
As at
1-4-2008
Purchased/
Sold
subscribed during the year
As at
31-3-2009
during the year
As at
31-3-2009
Rs.crore
As at
31-3-2008
Rs.crore
(iii) Certificate of deposits (contd.):
Brought forward
Punjab National Bank-6.80%, 29 Jul 2009
Punjab National Bank-7.69%, 19 Mar 2010
State Bank of Bikaner & Jaipur-6.90%, 27 Aug 2009
State Bank of Bikaner & Jaipur-6.95%, 17 Nov 2009
State Bank of Hyderabad-6.75%, 15 Sep 2009
State Bank of Indore-6.90%, 05 Jan 2010
State Bank of Patiala-6.45%, 09 Jul 2009
Certificates of deposits - total
(iv) Commercial paper:
HDFC Ltd - 8.15%
Commercial paper - total
(v) Mutual funds:
ABN AMRO China India Fund Dividend
ABN AMRO FMP - Series 8 - 1 Year
ABN AMRO Money Plus
AIG India Liquid Fund Super Institutional
Daily Dividend Reinvestment
AIG Short Term Fund Institutional Weekly Dividend
AIG Treasury Plus Fund
Super Institutional Daily Dividend Reinvestment
Baroda Pioneer Liquid Fund
Birla Cash Plus - Institutional Premium Daily Dividend
- Reinvestment
Birla Dynamic Bond Fund - Retail
- Quarterly Dividend Reinvestment
Birla FTP - Institutional - Series AB - Growth
Birla Income Plus
Birla Interval Income Fund - Institutional
- Quarterly - Series 3
Birla Mutual Fund - Income Short Term
- Dividend Reinvestment Option
Birla Sunlife Dynamic Bond Fund Growth Option
Birla Sunlife International Equity Fund Plan - B
Birla Sunlife Liquid Plus - IP
Birla Sunlife Short Term Opportunites Fund
Growth Option
Birla Sunlife Special Situations Fund
Birla Top 100 Fund - Dividend Reinvestment
Birla - BSL Interval Income Fund
- Quarterly Series 2 Dividend
Canara Robeco Liquid - Super IP
- Daily Dividend Reinvestment
DBS Chola FI - STF - IP - Growth
DBS Chola Short Term Floating Rate Fund
Daily Dividend Reinvestment
Deutsche Bank MF Insta Cash Plus
- Super Institutional Plan Daily - Dividend
DSP Merill Lynch Cash Plus Fund
DSP Merrill Lynch FMP 3m Series 6
- Institutional Dividend
Carried forward
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
5,00,000
10
10
10
1000
1000
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
–
–
–
–
–
–
–
–
1,500
20,000
1,500
5,500
1,500
5,000
1,500
2,000
–
–
–
–
–
–
–
–
1,500
20,000
1,500
5,500
1,500
5,000
1,500
2,000
50,00,000
2,50,00,000
–
–
–
41,75,77,193
50,00,000
2,50,00,000
40,45,50,784
–
–
1,30,26,409
4,99,685
1,50,743
32,79,668
594
37,79,353
1,51,337
–
–
3,51,46,497
–
14,41,70,764
19,99,056
17,43,18,163
–
49,99,098
19,99,056
4,99,14,210 5,48,41,43,137 5,43,73,68,216
9,66,89,131
4,75,04,133
5,00,00,000
–
20,50,09,919
–
2,20,43,474
25,25,14,052
5,00,00,000
–
–
–
2,20,43,474
7,55,09,113
3,16,02,687
10,71,11,800
–
3,01,60,332
3,00,98,042
–
–
50,00,000
50,00,000
4,28,404 1,46,99,58,441 1,29,53,53,531
62,290
15,87,13,629
–
–
15,87,13,629
–
17,50,33,314
–
50,00,000
51,32,469
30,42,33,044
–
–
–
50,00,000
51,32,469
30,42,33,044
–
–
5,12,76,782
14,76,966
5,27,53,748
–
–
–
2,99,73,594
98,70,961
2,00,12,069
–
99,61,525
98,70,961
4,99,29,996
5,60,66,608
10,59,96,604
–
10
1000
–
5,00,046
31,40,71,300
26,51,731
29,30,44,366
31,51,777
2,10,26,934
–
10
3,00,00,000
6,08,104
3,06,08,104
–
917.62
14.66
185.87
14.57
52.63
14.53
46.86
14.72
1261.46
95.52
95.52
–
–
13.03
–
–
5.00
2.00
96.88
–
–
25.46
–
–
227.32
–
175.15
304.23
–
–
–
10.00
10.02
–
21.07
–
–
890.16
–
–
–
–
–
–
–
–
–
–
–
5.00
25.00
–
50.01
15.07
35.19
–
50.01
50.00
50.00
–
75.51
30.23
–
5.00
0.43
–
5.00
10.00
51.28
–
–
50.01
–
50.01
30.00
587.75
115
Schedules forming part of the Accounts (contd.)
Schedule F-Details of investments (contd.)
Particulars
(v) Mutual funds (contd.):
Brought forward
DSP Merrill Lynch Liquidity Plus Fund - Daily Dividend
DWS Money Plus Advantage Fund I/P
DWS Short Maturity Fund - Weekly Dividend
Fidelity Cash Fund Super Institutional
Daily Dividend Reinvestment
Fidelity Liquid Plus Super Institutional
Fidelity Ultra Short Term Debt Fund S I
- Weekly Dividend
HDFC Arbitrage Fund Wholesale Plan Monthly Dividend
HDFC Cash Management Fund - Savings Plan
- Daily Dividend Reinvestment
HDFC Cash Management Fund - Savings Plus Plan
- Dividend
HDFC Income Fund - Dividend Option
HDFC Infrastructure Fund
HDFC Liquid Fund Premium Plan
- Dividend Daily Reinvestment
HDFC Midcap Opportunities Fund
HDFC Short Term Plan - Dividend Reinvestment
HSBC Cash Fund - Institutional Plus - Daily Dividend
HSBC Floating Rate - Long Term - Institutional Daily Dividend
ICICI Prudential Equity & Derivatives
- Income Optimiser Fund
ICICI Prudential FMP Series 39
- Six Months Plan A Retail Cumulative
ICICI Prudential Interval Fund 1 Month Plan
- A Retail Dividend Reinvestment
ICICI Prudential Interval Fund
Annual Interval Plan Institutional C
ICICI Prudential Interval Fund
II Quarterly Interval Plan F
IDBI Principal CMF - Liquid Option Institutional
Premium - Daily Dividend
IDFC Cash Fund - IP
ING FMP Institutional Growth
ING Income Fund - Short Term Plan-Dividend Option
ING Vysya Liquid Plus Fund
- Institutional Daily Dividend
ING Vysya Liquid Super Institutional
- Daily Dividend Option
JM Arbitrage Advantage Fund - Dividend Plan
JM FMP - Series VII - 13 Month Plan 1
JM Interval Fund - Quarterly Plan 1 Institutional
JP Morgan India Liquid Fund
- Daily Dividend Reinvestment
JP Morgan India Liquid Plus Fund
JP Morgan India Smaller Companies Fund
JPM India Alpha Fund - Dividend Reinvestment
Kotak Floater Long Term
- Daily Dividend Reinvestment
Kotak Floater - Short Term - Dividend
- Daily Dividend Reinvestment
LIC MF - Floating Rate Fund - Short Term
Carried forward
116
Face value
per unit
Rupees
Number of units
As at
1-4-2008
Purchased/
Sold
subscribed during the year
As at
31-3-2009
during the year
As at
31-3-2009
Rs.crore
As at
31-3-2008
Rs.crore
1000
10
10
5,00,292
15,17,45,390
5,95,14,882
10,10,889
8,47,484
2,58,306
15,11,181
15,25,92,874
5,97,73,188
–
–
–
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
5,00,09,349
–
12,00,98,911
9,03,83,536
16,01,11,975
7,02,89,050
99,96,285
2,00,94,486
–
7,76,47,408
1,00,48,987
38,47,528
–
8,14,94,936
1,00,48,987
–
4,70,17,226 1,45,89,90,410 1,50,60,07,636
–
–
–
1,00,00,000
1,03,94,43,056
9,38,47,946
–
90,06,40,669
7,05,96,018
1,00,00,000
13,88,02,387
2,32,51,928
–
–
14,02,734
4,42,10,366
9,99,62,238
–
2,40,02,25,476 2,33,90,39,947
14,02,734
4,44,53,224
92,94,90,010
5,00,63,869
–
9,70,81,445
82,95,27,772
5,45,31,911
6,11,85,529
–
9,68,38,587
–
44,68,042
2,35,18,344
25,61,404
2,60,79,748
5,00,00,000
–
5,00,00,000
4,46,58,807
3,55,005
4,50,13,812
6,00,00,000
–
6,00,00,000
5,00,00,000
20,02,700
5,20,02,700
26,93,84,722 1,05,39,34,036 1,31,83,17,676
1,35,10,25,625 1,32,09,20,701
2,50,00,000
2,18,86,056
–
2,50,00,000
2,18,86,056
–
–
10,14,343
12,28,90,118
12,39,04,461
4,99,85,353
7,65,05,509
4,00,00,000
4,99,63,527
4,99,70,712
3,01,36,760
1,00,00,000
–
26,21,62,905
30,63,559
–
10,92,237
20,32,21,527
16,01,11,264
–
92,21,022
31,21,48,258
7,95,69,068
4,00,00,000
5,10,55,764
24,31,86,813
16,70,98,398
1,00,00,000
–
–
–
–
–
–
50,01,082
3,01,04,924
–
–
–
–
–
–
–
1,00,05,426
2,31,49,626
–
92,21,022
–
3,78,31,042
1,98,41,664
1,79,89,378
1,19,62,830
24,11,35,228
1,38,732
23,77,70,857
1,21,01,562
47,89,06,085
–
–
890.16
–
–
–
10.00
20.10
10.05
–
–
139.24
25.32
–
75.01
–
100.41
–
5.02
–
–
–
–
–
5.00
30.11
–
–
–
–
–
–
–
10.01
23.17
–
9.23
18.13
–
–
1370.96
587.75
50.06
152.65
61.14
50.01
–
–
77.75
50.01
–
–
10.00
–
1.40
45.69
100.02
–
25.00
50.00
45.00
60.00
50.00
269.40
–
25.00
25.11
1.01
50.01
78.33
40.00
50.00
50.01
30.16
10.00
–
–
12.01
245.09
2302.61
Schedules forming part of the Accounts (contd.)
Schedule F-Details of investments (contd.)
Particulars
(v) Mutual funds (contd.):
Brought forward
LIC MF Fixed Maturity Plan Series 33
- 13 Months Dividend Plan
LIC MF Infrastructure Fund - Dividend Plan
LIC MF Liquid Fund - Dividend Plan
LIC MF Top 100 Fund
Lotus India Liquid Fund Institutional
Daily Dividend Reinvestment
Lotus India Liquid Plus Fund - IP
Mirae Asset Liquid Plus Fund - Super IP
Principal Floating Rate Fund
Principal Income Fund Dividend Reinvestment
ICICI Prudential - Super Institutional Daily Dividend
ICICI Prudential Technology Fund
ICICI Prudential Flexible Income Plan
ICICI Prudential Income Fund Institutional Plan
Dividend Reinvestment (Quarterly)
ICICI Prudential Short Term - IP - Dividend Reinvestment
ICICI Prudential - Emerging Star Fund
Reliance Income Fund - Retail Plan
- Monthly Dividend Reinvestment
Reliance Liquid Plus Fund
Reliance Medium Term Fund Daily Dividend Plan
(Reinvestment)
Reliance Mutual Fund Liquidity Fund
Daily Dividend Reinvestment
Reliance Quarterly Interval Fund Series III
Institutional Dividend
Reliance Quarterly Interval Fund Series I
- Institutional Dividend Plan
Reliance Short Term Fund - Retail Plan-Dividend Plan
SBI Debt Fund Series - 90 Days-21-(04-Mar-08)
- Dividend
SBI Debt Fund Series 30 Days (13-Mar-08) Dividend.
SBI Liquid Plus Plan
SBI Magnum Institutional Income Fund - Savings
- Daily Dividend
SBI Mutual Fund - Liquid Plan
- Dividend Reinvestment
Standard Chartered - GSSIF - Short Term - Plan C
- Monthly Dividend
Standard Chartered Arbitrage Fund Plan-B Dividend
Standard Chartered Fixed Maturity Plan
Quarterly Series 28
Standard Chartered Liquidity Manager Plus
- Dividend Reinvestment
Sundaram BNP Money Plus Super Institutional
Daily Dividend Plan
Sundaram BNP Paribas Interval Fund
Quarterly Plan - B Institutional dividend
Tata Dynamic Bond Option A
Carried forward
Face value
per unit
Rupees
Number of units
As at
1-4-2008
Purchased/
Sold
subscribed during the year
As at
31-3-2009
during the year
As at
31-3-2009
Rs.crore
As at
31-3-2008
Rs.crore
10
10
10
10
10
10
1000
10
10
10
10
10
10
10
10
10
1000
10
10
10
10
10
10
10
10
10
10
10
10
10
24,43,167
–
5,40,49,646
5,16,06,479
1,00,00,000
1,00,00,000
13,66,36,955 1,68,79,82,916 1,53,47,16,090
1,50,00,000
1,50,00,000
–
9,00,03,146 1,17,89,69,995 1,25,89,76,640
53,02,69,791
51,43,32,134
4,49,55,453
28,75,298
26,75,577
1,99,721
38,47,40,544
33,47,60,754
4,99,79,790
2,14,59,822
2,14,59,822
–
6,81,62,01,541 6,66,30,10,407
–
60,24,097
60,24,097
75,73,43,839
–
–
1,01,88,11,056
–
–
28,99,03,781
–
99,96,501
2,90,17,796
–
–
–
153,191,134
–
26,14,67,217
–
5,01,25,070
92,74,101
10,94,85,055
81,023
–
8,78,99,092
5,02,06,093
92,74,101
2,15,85,963
–
–
–
2,01,746
2,42,69,960
21,02,025
–
23,03,771
2,42,69,960
–
–
27,34,80,700
25,51,08,386
1,83,72,314
1370.96
2302.61
–
–
318.32
–
10.00
29.06
–
–
–
153.20
–
276.46
25.29
–
–
25.00
–
31.41
51.61
10.00
150.03
15.00
90.02
45.03
20.00
50.04
25.31
–
10.00
–
–
55.74
24.25
–
20.20
–
4,99,94,629 4,15,49,75,085 3,84,38,31,140
36,11,38,574
361.25
50.01
10,59,19,444
37,64,263
10,96,83,707
–
–
105.92
–
5,73,10,894
6,08,50,173
4,70,30,339
–
5,73,10,894
6,08,50,173
4,70,30,339
5,18,90,318
2,50,50,203
–
9,59,919
1,56,514
27,08,14,413
5,28,50,237
2,52,06,717
24,46,68,772
–
–
2,61,45,641
–
38,18,52,997
33,87,95,000
4,30,57,997
7,84,70,466
90,44,11,550
98,28,82,016
2,49,47,614
2,44,66,607
1,52,125
9,99,948
2,50,99,739
2,54,66,555
5,00,00,000
10,91,000
5,10,91,000
1000
5,00,007
24,90,172
29,90,179
–
–
–
–
–
60.89
50.21
–
–
26.16
72.12
–
–
–
–
–
10
10
10
–
30,86,46,090
28,47,97,698
2,38,48,392
24.08
4,99,86,504
4,77,54,926
11,05,601
4,78,17,446
5,10,92,105
9,55,72,372
–
–
–
–
–
60.45
51.89
25.05
–
–
78.74
25.03
25.42
50.00
50.01
–
50.00
50.16
2834.41
3492.52
117
Schedules forming part of the Accounts (contd.)
Schedule F-Details of investments (contd.)
Face value
per unit
Rupees
Number of units
As at
1-4-2008
Purchased/
Sold
subscribed during the year
As at
31-3-2009
during the year
As at
31-3-2009
Rs.crore
As at
31-3-2008
Rs.crore
2834.41
3492.52
10
10
10
1000
10
1000
1000
1000
10
10
5,01,93,814
–
50,00,000
4,48,712
–
2,972
5,01,82,953
35,70,38,157
–
2,99,83,662
6,20,63,434
15,05,119
10,03,76,767
32,65,24,790
50,00,000
3,04,32,374
–
15,08,091
–
3,05,13,367
–
–
6,20,63,434
–
2,49,026
1,202
2,50,228
–
4,99,979
–
5,00,00,000
2,32,23,667
30,20,83,643
–
2,36,23,688
25,83,12,694
5,00,00,000
99,958
4,37,70,949
–
10
7,55,97,383
3,29,87,389
10,85,84,772
–
10
1000
10
10,00,00,000
14,71,675
–
21,93,869
1,63,70,144
10,21,93,869
1,74,46,966
1,88,17,07,032 1,75,13,25,862
–
3,94,853
13,03,81,170
10
2,46,55,082
–
2,46,55,082
–
–
30.62
–
–
75.72
–
–
10.00
43.82
–
–
–
40.25
237.62
–
3272.44
3.84
3268.60
4879.67
–
0.08
2.52
8.84
11.94
69.88
12.17
13.73
–
0.35
8.25
127.76
8263.72
50.25
–
5.00
50.01
–
0.30
25.13
50.01
–
50.00
75.60
100.00
150.03
–
25.15
4074.00
23.35
4050.65
4282.65
0.08
0.07
2.61
7.50
2.23
50.71
8.68
0.16
0.01
0.36
3.44
75.85
6922.26
Particulars
(v) Mutual funds (contd.):
Brought forward
Tata Fixed Income Portfolio Fund
Scheme A2 Institutional
Tata Floater Fund - Daily Dividend
Tata Indo - Global Infrastructure Fund
Tata Mutual Fund - Liquid Ship - Daily Dividend
Tata Short Term Bond Fund - Dividend Reinvestment
Tata Treasury Manager Fund
Templeton India Short Term Income Plan Institutional
- Weekly Dividend.
Templeton India Treasury Management Liquid
Plan Daily Dividend
Templeton India Ultra Short Term Bond Fund
UTI Fixed Income Annual Interval Plan III
UTI Fixed Income Interval Fund
- Quaterly Plan Series III
UTI Fixed Maturity Plan - QFMP
- Dividend Reinvestment
UTI Liquid Cash Plan Institutional - Daily Dividend
UTI Mutual Fund - Money Market
UTI Short Term Income Fund Institutional
- income Option - Reinvestment
C)
Less: Provision for diminution in value
Mutual funds - total
Current investments - total
Investment in integrated joint ventures:
Bauer-L&T Diaphragm Wall Joint Venture
Desbuild-L&T Joint Venture
HCC-L&T Purulia Joint Venture
International Metro Civil Contractors Joint Venture
L&T-Eastern Joint Venture
L&T-AM Tapovan Joint Venture
L&T-Hochtief Seabird Joint Venture
L&T-Sanghai Urban Corporation Group Joint Venture
Larsen & Toubro Limited-Shapoorji Pallonji & Company Limited
Joint Venture (Ebene-Cybercity)
Larsen & Toubro Limited-Shapoorji Pallonji & Company Limited
Joint Venture (Les Pallies Exhibition Center)
Metro Tunneling Group
Investment in integrated joint ventures - total
Total investment (A+B+C)
118
Schedules forming part of the Accounts (contd.)
Schedule F-Details of investments purchased and sold during the year
Fully paid equity shares in associate companies:
Particulars
Face value
Rs. per unit
Nos.
Cost
Rs. crore
NAC Infrastructure Equipment Limited [see note no.35]
10
45,00,000
4.50
Government and trust securities:
6.05% Government of India bond 2019 (quoted)
7.46% Government of India bond 2017 (quoted)
7.94% Government of India bond 2021 (quoted)
8.24% Government of India bond 2018 (quoted)
Bonds:
10.70% Indian Railway Finance Corporation 2023 (quoted)
11.30% IDBI Bank Ltd. 2018 (quoted)
10.95% Rural Electrification Corporation Limited Bonds 2011 (quoted)
Deutsche Bank 9%- L&T Finance 2009
8.90% SBI 2023 (quoted)
Certificate of deposits:
Allahabad Bank-11.5%, 12 Mar 2009
Allahabad Bank-8.24%, 04 Jan 2010
Andhra Bank-14%, 27 Mar 2009
Andhra Bank-14.4%, 27 Mar 2009
Canara Bank-12.65%, 23 Mar 2009
Canara Bank-12.65%, 25 Mar 2009
Canara Bank-14.25%, 26 Mar 2009
Corporation Bank-14.5%, 27 Nov 2008
Corporation Bank-12.05%, 12 Feb 2009
HDFC Bank-12.35%, 13 Mar 2009
IDBI-10.50%, 20 Dec 2008
IDBI-14%, 26 Feb 2009
IDBI-14.25%, 26 Mar 2009
Indian Overseas Bank-13.75%, 27 Mar 2009
Oriental Bank of Commerce-14%, 24 Dec 2008
Oriental Bank of Commerce-11.5%, 25 Mar 2009
Oriental Bank of Commerce-14%, 25 Mar 2009
Oriental Bank of Commerce-9.79%, 03 Dec 2009
Oriental Bank of Commerce-8.19%, 01 Jan 2010
Punjab National Bank-11.7%, 07 Jan 2009
Punjab National Bank-13.5%, 07 Jan 2009
Punjab National Bank-11.5%, 24 Feb 2009
Punjab National Bank-12.05%, 24 Feb 2009
Punjab National Bank-14%, 24 Feb 2009
Punjab National Bank-12.65%, 10 Mar 2009
Punjab National Bank-14.4%, 10 Mar 2009
100
100
100
100
25,00,000
50,00,000
20,00,000
25.03
52.82
20.24
6,30,00,000
705.04
10,00,000
10,00,000
10,00,000
10,00,000
10,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
260
500
250
200
100
2,500
5,000
500
3,500
1,500
1,000
3,500
1,000
2,500
2,500
500
1,000
2,500
3,000
5,000
2,500
2,500
7,500
5,000
2,500
5,000
2,500
2,500
6,000
500
2,500
25.87
50.00
25.00
19.09
10.00
23.89
46.22
4.73
33.08
14.26
9.50
33.11
9.91
24.12
23.87
4.95
9.55
23.47
28.39
48.99
23.80
23.50
68.33
46.25
24.36
48.49
24.01
24.02
57.00
4.77
23.78
119
Schedules forming part of the Accounts (contd.)
Schedule F-Details of investments purchased and sold during the year (contd.)
Certificate of deposits (contd.):
Particulars
Punjab National Bank-13.5%, 12 May 2009
Punjab National Bank-11.6%, 29 Jul 2009
State Bank of Bikaner & Jaipur-13.5%, 06 Jan 2009
State Bank of Bikaner & Jaipur-10.50%, 20 Jan 2009
State Bank of Bikaner & Jaipur-14%, 20 Jan 2009
State Bank of Bikaner & Jaipur-11.75%, 27 Aug 2009
State Bank of Bikaner & Jaipur-11.75%, 22 Sep 2009
State Bank of Bikaner & Jaipur-9.61%, 17 Nov 2009
State Bank of Hyderabad-11.75%, 20 Aug 2009
State Bank of Hyderabad-13.5%, 20 Aug 2009
State Bank of Hyderabad-9.74%, 02 Dec 2009
State Bank of India-13.05%, 19 Mar 2009
State Bank of Indore-14%, 10 Mar 2009
State Bank of Mysore-13.7%, 15 Dec 2008
State Bank of Patiala-14%, 01 Dec 2008
State Bank of Patiala-11.5%, 10 Mar 2009
State Bank of Patiala-11.5%, 17 Mar 2009
State Bank of Patiala-11.6%, 09 Jul 2009
State Bank of Patiala-11.75%, 04 Sep 2009
UCO Bank-14%, 12 Mar 2009
UCO Bank-14.5%, 12 Mar 2009
Vijaya Bank-13.75%, 24 Mar 2009
Vijaya Bank-14%, 24 Mar 2009
Commercial paper:
HDFC Ltd - 12.60%
Mutual funds:
ABN AMRO Institutional Plus Daily Dividend
ABN AMRO Interval Fund Monthly Plan A Calendar Monthly Dividend
ABN AMRO Interval Fund Quarterly Plan L Dividend Reinvestment
ABN AMRO Interval Fund Series 2 Quarterly Plan M
Birla Sun Life Income Plus - Growth
Birla Sun Life Interval Income - Institutional - Monthly Series 2 - Dividend
Birla Sun Life Quarterly Interval - Series 7 - Dividend Reinvestment
Birla Sun Life Short Term Fund - Institutional Daily Dividend
Birla Sunlife Income Plus - Quarterly Dividend Reinvestment
Birla Sunlife Short Term Opportunities Fund - Dividend Reinvestment
Birla Sunlife Interval Income - Retail - Monthly - Series 2 - Dividend
Birla Sunlife Quarterly Interval - Series 5 Dividend - Reinvestment
Birla Sunlife Quarterly Interval Series 6 - Dividend Reinvestment
120
Face value
Rs. per unit
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
1,00,000
Nos.
2,500
1,500
5,000
2,000
9,000
1,500
1,500
5,500
2,500
2,500
Cost
Rs. crore
23.32
13.75
48.51
19.61
86.74
13.65
13.55
50.37
22.80
22.54
20,000
182.29
500
2,500
2,500
500
2,000
1,000
1,500
2,500
1,000
1,000
2,000
1,500
4.76
23.63
24.44
4.95
19.13
9.54
13.83
22.70
9.50
9.43
18.96
14.19
5,00,000
2,000
88.84
10
10
10
10
10
10
10
10
10
10
10
10
10
15,00,23,411
150.02
3,01,98,970
2,04,34,186
5,10,06,998
2,66,03,871
11,58,59,380
5,10,40,950
13,74,87,171
9,02,27,790
30,26,41,151
5,09,81,242
2,07,71,136
3,06,23,490
30.20
20.43
51.01
105.81
115.86
51.04
137.54
100.00
302.69
50.98
20.77
30.62
Schedules forming part of the Accounts (contd.)
Schedule F-Details of investments purchased and sold during the year (contd.)
Mutual funds (contd.):
Particulars
DBS Chola Interval Income Fund - MPI - A - Dividend - Auto Rollover
DBS Chola Liquid Fund
DSP Merrill Lynch Liquidity Fund - Institutional - Daily Dividend
DWS Money Plus Fund - IP
DWS Quarterly Interval Fund-Series 1 Dividend Plan
Fortis Overnight Fund - Institutional Plus - Daily Dividend
Fortis Short Term Income Fund - Institutional Plus - Monthly Dividend
Grindlays FRF - LT - Institutional Plan B
HDFC Floating Rate Income Fund - Long Term Plan - Dividend Reinvestment
HDFC FMP 90 days July 2008 viii(1) - Wholesale Plan Dividend
HDFC FMP 90 days July2008 (ix) (3) - Wholesale Plan Dividend Payout
HDFC FMP 90 days June 2008 (viii) (2) - Wholesale Plan Dividend Payout
HDFC FMP 90 days Nov 2008 (x)(4) - Wholesale Dividend Payout
HDFC FMP 90 days Nov 2008(x)(3) - Wholesale Plan Dividend Payout
HDFC FMP 90 days Sep 2008(viii)(4) - Wholesale Plan Dividend Payout
HDFC Income Fund - Growth
HDFC Quarterly Interval Fund - Plan A - Wholesale Dividend Reinvestment
HDFC Quarterly Interval Fund - Plan B - Wholesale Dividend Reinvestment
HSBC Fixed Term Series 60 Institutional Dividend - Tenure 90 Days
HSBC Liquid Plus Fund - Institutional Plus Plan - Dividend Reinvestment
ICICI Prudential FMP Series 44 - 1 Month Plan B - Retail Dividend - Reinvestment
ICICI Prudential FMP Series 44 - 1 Month Plan A - Retail Dividend
ICICI Prudential FMP Series 44 - 1 Month Plan C - Retail Dividend Payout
ICICI Prudential Interval Fund III - Monthly Plan - Retail Dividend Reinvestment
IDFC Fixed Maturity Plan - Partly Series 37 - Dividend
IDFC Fixed Maturity Plan - Quarterly Series 36 Dividend
IDFC Fixed Maturity Plan - Quarterly Series - 31 Dividend
IDFC Liquid Plus Fund - TP - Super Institutional - Plan C - Daily Dividend
IDFC Super Saver Income Fund - Investment Plan B - Growth
IDFC Super Saver Income - Investment Plan B - Quarterly Dividend Reinvestment
JPMorgan India Active Bond Fund - Dividend Reinvestment
JP Morgan India Active Bond Fund - Institutional - Growth
Kotak Bond Fund - Regular Plan - Quarterly Dividend Reinvestment
Kotak Flexi Debt Scheme - Daily Dividend
Kotak Mahindra MF - Liquid (Institutional premium) - Dividend Reinvestment
LIC Gilt Fund - Regular - Dividend
LIC Liquid Plus Institutional Plan
Lotus India Monthly Interval Fund Plan A - Dividend
Mirae Asset Interval Fund - Quarterly - Series I - Institutional Dividend Reinvestment Plan
Face value
Rs. per unit
Nos.
Cost
Rs. crore
10
10
1000
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
2,00,53,229
65,51,27,982
4,91,533
31,18,01,446
5,09,40,060
5,90,13,681
40,52,56,556
22,64,43,913
29,68,88,841
5,00,00,000
5,00,00,000
5,00,00,000
1,50,00,000
2,00,00,000
5,00,00,000
3,97,39,242
2,55,94,468
5,10,59,500
2,55,54,228
16,24,32,106
5,00,00,000
10,00,00,000
5,00,00,000
5,03,05,500
2,55,33,693
10,31,58,125
5,10,31,000
17,60,49,261
2,46,73,327
2,50,00,000
9,86,41,467
9,67,17,180
90,00,881
5,01,06,301
31,62,06,212
15,63,04,242
11,05,35,412
5,03,37,714
3,05,64,714
20.12
657.28
49.16
312.06
50.94
59.03
405.26
226.57
302.13
50.00
50.00
50.00
15.00
20.00
50.00
79.44
25.59
51.06
25.55
162.64
50.00
100.00
50.00
50.31
25.53
103.16
51.03
176.08
25.87
25.00
100.82
106.44
10.42
50.26
386.66
210.00
110.54
50.34
30.57
121
Schedules forming part of the Accounts (contd.)
Schedule F-Details of investments purchased and sold during the year (contd.)
Mutual funds (contd.):
Particulars
Face value
Rs. per unit
Nos.
Cost
Rs. crore
Mirae Asset Liquid Fund Super IP - Daily Dividend Reinvestment
1000
Mirae Asset interval Fund Quarterly Plan - Series II Institutional Dividend Reinvestment
Prudential ICICI Institutional Income Plan - Growth
Prudential ICICI Liquid Plan - Monthly Dividend Reinvestment
Reliance Fixed Horizon Fund viii Series 9 - Institutional Dividend Payout
Reliance Fixed Horizon Fund viii - Series 10 - Institutional Dividend
Reliance Fixed Horizon Fund - xii - Series 13 - Super Institutional Dividend Plan
Reliance Fixed Horizon Fund - xii - Series 14 - Super Institutional Dividend Plan
Reliance Income Fund - Retail Plan - Growth Plan - Growth Option
Reliance Monthly Interval Fund Series II - Institutional Dividend
Reliance Monthly Interval Fund Series - I - Institutional Dividend
Reliance Mutual Fund - Income ST - Dividend Reinvestment
Reliance RLF Treasury Plan Institutional Option - Monthly Dividend
SBI Debt Fund Series - 90 Days - 25 - Dividend
Sundaram BNP Paribas Liquid Plus - Sup Income Plan
Sundaram BNP Paribas Interval Fund - Quarterly Plan D Institutional Dividend
Sundaram BNP Paribas Interval Fund - Quarterly - Plan - B - Institutional Dividend
Tata Dynamic Bond Fund Option B - Dividend
Tata Fixed Income Portfolio Fund Scheme - B2 Institutional - Dividend Reinvestment
Tata Floating Rate Fund-ST- Income Plan - Daily Dividend Reinvestment
Templeton India Income Fund
Templeton India Income Fund - Growth
Templeton Quarterly Interval Plan Institutional - Dividend Reinvestment
UTI - Fixed Maturity Plan - QFMP - 06/08 - II - Institutional Dividend Plan
UTI Bond Fund - Income Reinvestment
UTI Bond Fund - Growth Plan - Regular
UTI Fixed Income Fund - Series II - Quareterly Interval vii - Institutional Dividend Reinvestment
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
UTI Fixed Income Interval Fund - Quarterly Plan Series - I - Institutional Dividend Reinvestment 10
UTI Fixed Income Interval Fund - Monthly Interval Plan Series - 1
UTI Liquid Plus Institutional Plan
UTI Short Term FMP Series II (90 days) - Institutional Dividend Reinvestment Plan
UTI - Floating Rate Fund - Short Term PIan - Dividend Option - Reinvestment
Pass through certificates:
L&T Finance Pass through certificates 11.75% 22 Aug 2009
L&T Finance Pass through certificates 11.75% 23 Feb 2009
L&T Finance Pass through certificates 11.75% 22 Nov 2008
Non-convertible debentures:
11.45% Reliance Industries 2013
122
10
1000
10
1000
1,00,00,000
1,00,00,000
1,00,00,000
76,51,830
2,55,04,363
3,65,99,350
19,58,38,035
6,00,00,600
6,00,00,000
6,00,18,600
7,00,00,000
2,65,79,204
5,06,10,211
10,13,77,805
6,79,69,622
16,18,04,702
5,37,96,838
9,01,11,213
2,04,22,300
2,55,87,800
4,92,97,615
1,01,71,078
765.68
25.51
106.40
227.53
60.00
60.00
60.02
70.00
77.68
50.64
101.46
75.00
333.07
53.80
90.34
20.42
25.59
50.56
10.17
17,84,51,576
178.65
2,38,89,383
87,74,560
5,09,80,000
5,09,35,513
8,84,31,966
4,06,57,733
3,58,78,567
2,55,83,524
5,06,74,842
36,62,304
4,07,57,541
2,46,373
25
25
25
25.00
25.77
51.04
50.94
100.00
106.19
35.88
25.58
50.67
367.63
40.76
25.52
24.38
24.92
25.14
10,00,000
500
50.00
Schedules forming part of the Accounts (contd.)
Schedule G
Current assets, loans and advances:
Current assets:
Interest accrued on investments
Inventories:
Stock-in-trade, at cost or net realisable value whichever is lower:
Raw materials
Components
Construction materials
Stores, spare parts and loose tools
Finished goods
Work-in-progress:
Manufacturing work-in-progress at cost or
net realisable value whichever is lower
Construction and project related work-in-progress
At cost
At estimated realisable value on sale
Less: Progress bills raised
Due from customers
Total work-in-progress
Sundry debtors:
Unsecured:
Debts outstanding for more than 6 months
Considered good
Considered doubtful
Other debts:
Considered good
Less: Provision for doubtful debts
Cash and bank balances:
Cash on hand
Cheques on hand
Balances with scheduled banks:
on current accounts
on fixed deposits including interest accrued thereon
[see note no.5(a)]
on margin money deposit accounts
Balances with non-scheduled banks [see note no.5(b)]
Carried forward
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
21.56
14.32
380.49
300.00
20.17
103.39
342.54
1146.59
323.92
1745.24
20774.51
22519.75
18185.21
4334.54
4658.46
2293.78
383.60
2677.38
7761.74
10439.12
383.60
3.56
248.85
269.90
80.66
1.50
170.82
309.27
242.81
6.44
89.55
321.38
969.45
298.93
1757.96
14757.15
16515.11
13477.58
3037.53
3336.46
5805.05
4305.91
1823.74
272.19
2095.93
5541.27
7637.20
272.19
10055.52
7365.01
7.80
270.83
376.82
182.99
1.61
124.41
775.29
16657.42
964.46
12649.70
123
Schedules forming part of the Accounts (contd.)
Schedule G (contd.)
Brought forward
Loans and advances:
Secured, considered good:
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
16657.42
12649.70
Loans against mortgage of house property
21.37
24.34
Unsecured:
Considered good:
Subsidiary companies
Loans including interest accrued thereon [see note no.16]
Others
Associate companies
Advances recoverable
Advances towards equity commitment
Subsidiary companies
Inter-corporate deposits
Subsidiary companies [see note no.16]
Associate companies [see note no.16]
Others
Advances recoverable in cash or in kind [see note no.15]
Balance with customs, port trust, etc.
Considered doubtful:
Deferred credit against sale of ships
Advances recoverable in cash or in kind
Less: Provision for doubtful loans and advances
778.00
257.31
24.61
623.58
669.62
5.00
2.01
4377.98
31.12
21.09
62.22
6873.91
83.31
82.19
160.02
13.96
66.35
16.29
10.00
11.02
3347.29
25.62
16.68
23.55
3797.31
40.23
6790.60
23448.02
3757.08
16406.78
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
61.66
62.17
209.76
10.98
6592.83
107.38
3.62
5381.16
6813.57
5492.16
24437.33
19139.52
21512.52
16522.13
2924.81
4871.07
14671.11
2617.39
3518.49
11690.21
Schedule H
Current liabilities and provisions:
Liabilities:
Acceptances
Sundry creditors:
Due to: Subsidiary companies
Micro and small enterprises [see note no.33]
Others [see note no.7]
Due to customers:
Progress bills raised
Less: Construction and project related work-in-progress
At cost: (previous year: Rs.948.37 crore)
At estimated realisable value:
(previous year: Rs.15573.76 crore)
1609.67
19902.85
Advances from customers
Carried forward
124
Schedules forming part of the Accounts (contd.)
Schedule H (contd.)
Brought forward
Items covered by investor education and protection fund
[see note no.36]
Unpaid dividend
Unpaid matured deposits
Unpaid matured debentures/bonds
Interest accrued on bonds
Due to directors
Interest accrued but not due on loans
Pension payable under Voluntary Retirement-cum-Pension Scheme
Provisions for:
Current taxes
Tax on fringe benefits
Proposed dividend
Additional tax on dividend
Gratuity
Compensated absences
Employee pension schemes
Post-retirement medical benefit plan
Long service awards
Other provisions (AS-29 related) [see note no.23]
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
14671.11
11690.21
10.33
0.08
0.15
0.02
1391.60
53.94
614.97
101.83
0.52
237.12
151.80
70.97
7.72
436.06
9.61
0.12
1.58
0.03
10.58
36.37
57.82
–
11.34
22.86
17.27
0.04
14775.88
11741.72
918.12
68.52
438.49
66.60
0.45
209.49
151.35
56.67
14.59
111.14
3066.53
17842.41
2035.42
13777.14
As at 31-3-2009
Rs.crore
As at 31-3-2008
Rs.crore
Schedule I
Miscellaneous expenditure
(to the extent not written off or adjusted)
Voluntary Retirement-cum-Pension Schemes/Voluntary Retirement Schemes
0.26
0.26
3.06
3.06
125
Schedules forming part of the Accounts (contd.)
Schedule J
Contingent liabilities:
(a) Claims against the Company not acknowledged as debts
(b) Sales tax liability that may arise in respect of matters in appeal
(c) Excise duty/service tax liability that may arise in respect of
matters in appeal/challenged by the Company in writ
Income tax liability (including penalty) that may arise in respect
of which the Company is in appeal
(d)
(e) Guarantees given on behalf of subsidiary companies
(f) Guarantees given on behalf of associate companies
As at 31-3-2009
Rs.crore
As at 31-3-2008
Rs.crore
166.21
66.96
10.93
1.62
361.16
–
112.36
202.98
9.91
0.92
69.18
10.00
Notes:
1.
2.
3.
The Company does not expect any reimbursements in respect of the above contingent liabilities.
It is not practicable to estimate the timing of cash outflows, if any, in respect of matters at (a) to (d) above pending resolution of the
arbitration/appellate proceedings.
In respect of matters at (e) and (f), the cash outflows, if any, could generally occur during the next three years, being the period over which
the validity of the guarantees extends except in a few cases where the cash outflows, if any, could occur any time during the subsistence
of the borrowing to which the guarantees relate.
Schedule K
Sales & service:
Manufacturing, trading and property development activity
Construction and project related activity
Servicing
Commission
Engineering and service fees
Schedule L (i)
Other operational income:
Income from hire of plant and machinery
Technical fees
Company’s share in net profit of integrated joint ventures
[see note no.14(b)]
Lease rentals
Profit on sale of fixed assets (net)
Income from services to the Group companies
Miscellaneous income
Unclaimed credit balances
126
2008-2009
Rs.crore
5880.69
27456.22
242.46
201.51
264.16
34045.04
2008-2009
Rs.crore
5.77
52.25
12.53
2.32
2.57
66.53
112.88
24.95
279.80
2007-2008
Rs.crore
6132.85
18441.11
182.85
222.51
208.16
25187.48
2007-2008
Rs.crore
6.62
13.06
1.28
2.14
5.77
42.79
70.08
12.99
154.73
Schedules forming part of the Accounts (contd.)
Schedule L (ii)
Other income:
Interest income:
Interest received on inter-corporate deposits, from subsidiary and
associate companies,customers and others
(Tax deducted at source Rs.13.20 crore; previous year: Rs.3.24 crore)
Income from long term investments:
Interest on bonds and government securities
(Tax deducted at source Rs.0.35 crore; previous year: Rs.nil)
Income from current investments:
Interest on bonds and government securities
(Tax deducted at source Rs.nil; previous year: Rs.0.63 crore)
Dividend income:
From long term investments:
Subsidiary companies
Trade investments
Other investments
From current investments
Profit on sale of investments:
Profit on sale of long term investments (net)
Profit on sale of current investments (net)
Lease rental
Profit on sale of fixed assets (net)
Miscellaneous income
Provision no longer required written back
Unclaimed credit balances
Schedule M
Manufacturing, construction and operating expenses:
Materials consumed:
Raw materials and components
Construction materials
Less: Scrap sales
Purchase of trading goods
Carried forward
2008-2009
2007-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
96.75
9.25
65.82
15.80
56.24
8.65
80.69
253.94
–
94.66
47.22
25.78
11.48
171.82
84.48
46.91
11.50
2.42
60.83
124.73
111.82
45.27
185.56
157.09
17.54
1.15
74.55
–
–
520.37
334.63
94.66
20.46
2.21
106.69
8.23
1.08
739.78
2008-2009
2007-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
6619.00
7772.53
14391.53
67.73
5845.09
5610.32
11455.41
72.00
14323.80
1678.69
16002.49
11383.41
1626.10
13009.51
127
Schedules forming part of the Accounts (contd.)
Schedule M (contd.)
Brought forward
(Increase)/decrease in stocks:
Closing stock:
Finished goods
Work-in-progress
Less: Opening stock:
Finished goods
Work-in-progress
Sub-contracting charges
Stores, spares and tools
Excise duty
Power & fuel
Royalty and technical know-how fees
Packing and forwarding
Hire charges - plant & machinery and others
Engineering, technical and consultancy fees
Insurance
Rent
Rates & taxes
Travelling and conveyance
Repairs to plant & machinery
Repairs to buildings
General repairs & maintenance
Other expenses
Schedule N
Staff expenses:
Salaries, wages and bonus
Contribution to and provision for:
2008-2009
2007-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
16002.49
13009.51
342.54
1454.22
1796.76
321.38
1370.27
1691.65
(5.16)
456.39
2.81
117.94
357.67
462.19
75.84
126.17
30.98
281.37
47.58
8.45
97.59
150.47
(105.11)
7223.59
900.75
(746.17)
4485.43
699.54
321.38
1370.27
1691.65
246.93
698.55
945.48
1.60
346.21
1.76
85.58
288.72
356.30
74.35
67.84
20.93
211.45
53.20
7.19
79.54
111.02
2210.29
26232.01
1705.69
19154.00
2008-2009
2007-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
1562.04
1179.04
Provident funds and pension fund
Superannuation/employee pension schemes
(including provision of Rs.0.45 crore; previous year: Rs.32.79 crore)
Gratuity funds
(including provision of Rs.0.07 crore; previous year: Rs.0.07 crore)
Compensated absences/leave encashment
68.85
40.41
27.65
27.63
59.24
66.48
27.35
0.35
Welfare and other expenses
128
164.54
271.44
1998.02
153.42
202.99
1535.45
Schedules forming part of the Accounts (contd.)
2008-2009
2007-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Schedule O
Sales, administration and other expenses:
Power and fuel
Packing and forwarding
Professional fees
Insurance
Rent
Rates and taxes
Travelling and conveyance
Repairs to buildings
General repairs and maintenance
Directors’ fees
Telephone, postage and telegrams
Advertising and publicity
Stationery and printing
Commission:
Distributors and agents
Others
Bank charges
Miscellaneous expenses
Bad debts and advances written off
Less: Provision for doubtful debts and advances written back
Company’s share in loss of integrated joint ventures [see note no.14(b)]
Discount on sales
Provision for doubtful debts and advances (net)
Provision for foreseeable losses on construction contracts
Provision for diminution in value of current investments
Other provisions [see note no.23]
Schedule P
Interest expenses & brokerage:
Debentures and fixed loans
Others
37.60
9.98
76.59
72.50
26.91
161.04
117.13
6.98
98.73
31.44
198.04
18.28
89.19
0.22
68.93
57.88
34.68
47.58
62.11
363.74
4.09
1.85
45.60
226.99
55.81
8.12
138.64
1863.98
2008-2009
Rs.crore
253.08
97.14
350.22
28.17
9.36
37.67
36.24
19.04
186.72
95.87
6.73
90.54
26.29
152.17
22.78
74.91
0.18
57.54
53.51
27.72
37.53
50.96
259.70
1.43
3.69
47.43
84.32
24.80
24.42
13.76
1362.04
2007-2008
Rs.crore
45.47
77.19
122.66
129
Schedules forming part of the Accounts (contd.)
SIGNIFICANT ACCOUNTING POLICIES
Schedule Q
1. Basis of accounting
The Company maintains its accounts on accrual basis following the historical cost convention in accordance with generally accepted
accounting principles [GAAP] except for the revaluation of certain fixed assets, in compliance with the provisions of the Companies Act,
1956 and the Accounting Standards as specified in the Companies (Accounting Standards) Rules, 2006 prescribed by the central government.
However, certain escalation and other claims, which are not ascertainable/acknowledged by customers, are not taken into account.
The preparation of financial statements in conformity with GAAP requires that the management of the Company makes estimates and
assumptions that affect the reported amounts of income and expenses of the period, the reported balances of assets and liabilities and the
disclosures relating to contingent liabilities as of the date of the financial statements. Examples of such estimates include the useful lives of
tangible and intangible fixed assets, provision for doubtful debts/advances, future obligations in respect of retirement benefit plans, etc.
Difference, if any, between the actual results and estimates is recognised in the period in which the results are known.
2. Revenue recognition
Revenue is recognised based on nature of activity when consideration can be reasonably measured and there exists reasonable certainty
of its recovery.
a)
Sales & service
i)
ii)
Sales and service include excise duty and adjustments made towards liquidated damages and price variation, wherever applicable.
Revenue from sale of goods is recognised when the substantial risks and rewards of ownership are transferred to the buyer
under the terms of the contract.
iii) Revenue from property development activity is recognised when all significant risks and rewards of ownership in the land and/or
building are transferred to the customer and a reasonable expectation of collection of the sale consideration from the customer
exists.
iv) Revenue from construction/project related activity and contracts for supply/commissioning of complex plant and equipment is
recognised as follows:
a) Cost plus contracts: Contract revenue is determined by adding the aggregate cost plus proportionate margin as agreed with
b)
c)
the customer.
Fixed price contracts received up to March 31, 2003: Contract revenue is recognised by applying percentage of completion
to the contract value. Percentage of completion is determined as follows:
(i)
(ii)
Fixed price contracts received on or after April 1, 2003: Contract revenue is recognised by adding the aggregate cost and
proportionate margin using the percentage completion method. Percentage of completion is determined as a proportion of
cost incurred-to-date to the total estimated contract cost.
in the case of item rate contracts, as a proportion of the progress billing to contract value; and
in the case of other contracts, as a proportion of the cost incurred-to-date to the total estimated cost
Full provision is made for any loss in the period in which it is foreseen.
v) Revenues from construction/project related activity and contracts executed in joint ventures under work-sharing arrangement
[being jointly controlled operations, in terms of Accounting Standard (AS) 27 "Financial Reporting of Interests in Joint Ventures"],
are recognised on the same basis as similar contracts independently executed by the Company.
vi) Revenue from service related activities is recognised using the proportionate completion method.
vii) Commission income is recognised as and when the terms of the contract are fulfilled.
viii) Revenue from engineering and service fees is recognised as per the terms of the contract.
ix) Government subsidy related to shipbuilding contracts is recognised on a prudent basis in the Profit and Loss Account as revenue
from operations in proportion to work completed when there is reasonable assurance that the conditions for the grant of subsidy
will be fulfilled.
b)
Profit/loss on contracts executed by integrated joint ventures under profit-sharing arrangement [being jointly controlled entities, in
terms of Accounting Standard (AS) 27 "Financial Reporting of Interests in Joint Ventures"] is accounted as and when the same is
determined by the joint venture. Revenue from services rendered to such joint ventures is accounted on accrual basis.
c) Other operational income represents income earned from the activities incidental to the operations of the business segments and is
recognised on rendering of related services as per the terms of the contract.
Interest income is accrued at applicable interest rate.
d)
e) Other items of income are accounted as and when the right to receive arises.
3. Research and development
Revenue expenditure on research and development is charged under respective heads of account in the year in which it is incurred. Capital
expenditure on research and development is included as part of fixed assets and depreciated on the same basis as other fixed assets.
130
Schedules forming part of the Accounts (contd.)
4.
5.
6.
Employee benefits
a)
b)
ii)
Short term employee benefits
All employee benefits falling due wholly within twelve months of rendering the service are classified as short term employee benefits.
The benefits like salaries, wages, short term compensated absences etc. and the expected cost of bonus, ex-gratia. are recognised
in the period in which the employee renders the related service.
Post-employment benefits
i)
Defined contribution plans: The Company's superannuation scheme, state governed provident fund scheme, employee state
insurance scheme and employee pension scheme are defined contribution plans. The contribution paid/payable under the schemes
is recognised during the period in which the employee renders the related service.
Defined benefit plans: The employees gratuity fund schemes, post-retirement medical care scheme, pension scheme and provident
fund scheme managed by trust are the Company's defined benefit plans. Wherever applicable, the present value of the obligation
under such defined benefit plans is determined based on actuarial valuation using the Projected Unit Credit Method, which
recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit
separately to build up the final obligation.
The obligation is measured at the present value of the estimated future cash flows. The discount rate used for determining the
present value of the obligation under defined benefit plans, is based on the market yield on government securities of a maturity
period equivalent to the weighted average maturity profile of the related obligations at the Balance Sheet date.
Actuarial gains and losses are recognised immediately in the Profit and Loss Account.
In case of funded plans, the fair value of the plan assets is reduced from the gross obligation under the defined benefit plans. to
recognise the obligation on the net basis.
Gains or losses on the curtailment or settlement of any defined benefit plan are recognised when the curtailment or settlement
occurs. Past service cost is recognised as expense on a straight-line basis over the average period until the benefits become
vested.
c)
d)
Long term employee benefits
The obligation for long term employee benefits such as long term compensated absences, long service award etc. is recognised in the
similar manner as in the case of defined benefit plans as mentioned in (b) (ii) above.
Termination benefits
Termination benefits such as compensation under Voluntary Retirement-cum-Pension Scheme is amortised over a defined period.
The defined period of amortisation is five years or the period till March 31, 2010, whichever is earlier.
Fixed assets
Fixed assets are stated at original cost net of tax/duty credits availed, if any, less accumulated depreciation, accumulated amortisation and
cumulative impairment and those which were revalued as on October 1,1984 are stated at the values determined by the valuers less
accumulated depreciation, accumulated amortisation and cumulative impairment. Assets acquired on hire purchase basis are stated at
their cash values. Specific know-how fees paid, if any, relating to plant and machinery is treated as part of cost thereof.
Administrative and other general overhead expenses that are specifically attributable to construction or acquisition of fixed assets or
bringing the fixed assets to working condition are allocated and capitalised as a part of the cost of the fixed assets.
Own manufactured assets are capitalised at cost including an appropriate share of overheads.
(Also refer to policy on leases, borrowing costs, impairment of assets and foreign currency transactions infra)
Leases
a)
Lease transactions entered into prior to April 1, 2001:
Assets leased out are stated at original cost. Lease equalisation adjustment is the difference between capital recovery included in the
lease rentals and depreciation provided in the books.
Lease rentals in respect of assets acquired under leases are charged to Profit and Loss Account.
b)
Lease transactions entered into on or after April 1, 2001:
i)
Assets acquired under leases where the Company has substantially all the risks and rewards of ownership are classified as
finance leases. Such assets are capitalised at the inception of the lease at the lower of the fair value or the present value of
minimum lease payments and a liability is created for an equivalent amount. Each lease rental paid is allocated between the
liability and the interest cost, so as to obtain a constant periodic rate of interest on the outstanding liability for each period.
ii)
Assets acquired on leases where a significant portion of the risks and rewards of ownership are retained by the lessor are
classified as operating leases. Lease rentals are charged to the Profit and Loss Account on accrual basis.
iii) Assets given under a finance lease are recognised as a receivable at an amount equal to the net investment in the lease. Lease
income is recognised over the period of the lease so as to yield a constant rate of return on the net investment in the lease.
iv) Assets leased out under operating leases are capitalised. Rental income is recognised on accrual basis over the lease term.
v)
(Also refer to policy on depreciation, infra)
Initial direct costs relating to assets given on finance leases are charged to Profit and Loss Account.
131
Schedules forming part of the Accounts (contd.)
7. Depreciation
a) Owned assets
i)
ii)
Revalued assets:
Depreciation is provided on straight line method on the values and at the rates given by the valuers. The difference between
depreciation provided on revalued amount and on historical cost is transferred from revaluation reserve to Profit and Loss
Account.
Assets carried at historical cost:
Depreciation on assets carried at historical cost is provided on the written down value basis on assets acquired up to March 31,
1968 (at the rates prescribed under Schedule XIV to the Companies Act, 1956) and on straight line method on assets acquired
subsequently (at the rates prevailing at the time of their acquisition on assets acquired up to September 30, 1987 and at the rates
prescribed under Schedule XIV to the Companies Act, 1956 on assets acquired after that date). However, in respect of the
following asset categories, the depreciation is provided at higher rates in line with their estimated useful life.
Category of asset
Furniture and fixtures
Plant and machinery:
Rate of depreciation (% p.a.)
10.00
Office equipment
Cranes above 1000 ton capacity used for construction activity
i)
ii)
iii) Minor plant & machinery of construction activity
iv) Heavy lift equipment of construction activity
v)
Earthmoving, tunnelling & transmission line equipment
(other than employed in heavy construction work)
vi) Air conditioning and refrigeration equipment
vii) Laboratory and canteen equipment
Motor cars
6.67
6.67
20.00
5.00
10.00
8.33
12.50
14.14
iii) Depreciation for, additions to/deductions from, owned assets is calculated pro rata from/to the month of additions/deductions.
Extra shift depreciation is provided on a location basis.
iv) Depreciation charge for impaired assets is adjusted in future periods in such a manner that the revised carrying amount of the
asset is allocated over its remaining useful life.
b)
Leased assets
i)
Lease transactions entered into prior to April 1, 2001:
Assets given on lease are depreciated over the primary period of the lease. Accordingly, while the statutory depreciation on such
assets is provided for on straight line method as per schedule XIV to the Companies Act, 1956, the difference is adjusted through
lease equalisation and lease adjustment account.
ii)
Lease transactions entered into on or after April 1, 2001:
Assets acquired under finance leases are depreciated on a straight line basis over the lease term. Where there is reasonable
certainty that the Company shall obtain ownership of the assets at the end of the lease term, such assets are depreciated at the
rates prescribed under Schedule XIV to the Companies Act, 1956 or at the higher rates adopted by the Company for similar
assets.
8.
Intangible assets and amortisation
Intangible assets are recognised when it is probable that the future economic benefits that are attributable to the asset will flow to the
enterprise and the cost of the asset can be measured reliably. Intangible assets are amortised as follows:
a)
b)
c)
Leasehold land: Over the period of lease.
Specialised software: Over a period of three years.
Lump sum fees for technical know-how: Over a period of six years in case of foreign technology and three years in the case of
indigenous technology.
Administrative and other general overhead expenses that are specifically attributable to acquisition of intangible assets are allocated and
capitalised as a part of the cost of the intangible assets.
Amortisation on impaired assets is provided by adjusting the amortisation charges in the remaining periods so as to allocate the asset's
revised carrying amount over its remaining useful life.
9.
Impairment of assets
As at each Balance Sheet date, the carrying amount of assets is tested for impairment so as to determine:
a)
the provision for impairment loss, if any, required; or
132
Schedules forming part of the Accounts (contd.)
b)
the reversal, if any, required of impairment loss recognised in previous periods.
Impairment loss is recognised when the carrying amount of an asset exceeds its recoverable amount.
Recoverable amount is determined:
a)
b)
in the case of an individual asset, at the higher of the net selling price and the value in use;
in the case of a cash generating unit (a group of assets that generates identified, independent cash flows), at the higher of the cash
generating unit's net selling price and the value in use.
(Value in use is determined as the present value of estimated future cash flows from the continuing use of an asset and from its disposal at
the end of its useful life.)
10.
Investments
Long term investments including interests in incorporated jointly controlled entities, are carried at cost, after providing for any diminution in
value, if such diminution is of permanent nature. Current investments are carried at lower of cost or market value. The determination of
carrying amount of such investments is done on the basis of specific identification. Investments in integrated joint ventures are carried at
cost net of adjustments for Company's share in profits or losses as recognised.
11.
Inventories
Inventories are valued after providing for obsolescence, as under:
a) Raw materials, components, construction materials, stores, spares and loose tools at lower of weighted average cost or net realisable
value.
b) Work-in-progress
i) Work-in-progress (other than project and construction-related) at lower of cost including related overheads or net realisable
ii)
value.
Project and construction-related work-in-progress at cost till such time the outcome of the job cannot be ascertained reliably and
at realisable value thereafter.
In the case of qualifying assets, cost includes applicable borrowing costs vide policy relating to borrowing costs.
Finished goods at lower of weighted average cost or net realisable value. Cost includes related overheads and excise duty paid/
payable on such goods.
Property development land at lower of cost or net realisable value.
c)
d)
12. Securities premium account
a)
b)
Securities premium includes:
i)
The difference between the market value and the consideration received in respect of shares issued pursuant to Stock Appreciation
Rights Scheme.
The discount allowed, if any, in respect of shares allotted pursuant to Stock Options Scheme.
ii)
The following expenses are written off against securities premium account:
i)
ii)
iii) Premium (net of tax) on redemption of debentures/bonds.
Expenses incurred on issue of shares.
Expenses (net of tax) incurred on issue of debentures/bonds.
13. Borrowing costs
Borrowing costs that are attributable to the acquisition, construction or production of a qualifying asset are capitalised as part of cost of such
asset till such time as the asset is ready for its intended use or sale. A qualifying asset is an asset that necessarily requires a substantial
period of time to get ready for its intended use or sale. All other borrowing costs are recognised as an expense in the period in which they
are incurred.
14. Employee stock ownership schemes
In respect of stock options granted pursuant to the Company's Stock Options Scheme, the intrinsic value of the options (excess of market
price of the share over the exercise price of the option) is treated as discount and accounted as employee compensation cost over the
vesting period.
15. Miscellaneous expenditure
Lump sum compensation paid under Voluntary Retirement-cum-Pension Schemes are amortised over a period of five years or the period
till March 31, 2010, whichever is earlier. The future pensions under Voluntary Retirement-cum-Pension Scheme are amortised over the
period for which pensions are payable.
16. Foreign currency transactions, foreign operations, forward contracts and derivatives
a)
The reporting currency of the Company is the indian rupee.
133
Schedules forming part of the Accounts (contd.)
b)
c)
d)
e)
f)
Foreign currency transactions are recorded on initial recognition in the reporting currency, using the exchange rate at the date of the
transaction. At each Balance Sheet date, foreign currency monetary items are reported using the closing rate. Non-monetary items
which are carried at historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.
Exchange differences that arise on settlement of monetary items or on reporting at each Balance Sheet date of the Company's
monetary items at the closing rate are:
i)
adjusted in the cost of fixed assets specifically financed by the borrowings contracted up to March 31, 2004 to which the exchange
differences relate
adjusted in the cost of fixed assets specifically financed by borrowings contracted between the period April 1, 2004 to March 31,
2007 and to which the exchange differences relate, provided the assets are acquired from outside India
recognised as income or expense in the period in which they arise, in cases other than (i) and (ii) above.
iii)
Financial statements of foreign operations comprising jobs contracted prior to April 1, 2004, are translated as follows:
i)
ii)
Closing inventories at rates prevailing at the end of the year.
Fixed assets as at April 1, 1991 at rates prevailing at the end of the year in which the additions were made. Subsequent additions
are at rates prevailing on the dates of the additions. Depreciation is accounted at the same rate at which the assets are translated.
ii)
iii) Other assets and liabilities at rates prevailing at the end of the year.
iv) Net revenues at the average rate for the year.
Financial statements of foreign operations comprising jobs contracted on or after April 1, 2004, are treated as integral operations and
translated as in the same manner as foreign currency transactions, as described above. Exchange differences arising on such
translation are recognised as income or expense of the period in which they arise.
Forward contracts, other than those entered into to hedge foreign currency risk on unexecuted firm commitments or highly probable
forecast transactions, are treated as foreign currency transactions and accounted accordingly as per Accounting Standard (AS) 11
["The Effects of Changes in Foreign Exchange Rates"], Exchange differences arising on such contracts are recognised in the period
in which they arise.
Gains and losses arising on account of roll over/cancellation of forward contracts are recognised as income/expense of the period in
which such roll over/cancellation takes place.
All the other derivative contracts, including forward contracts entered into to hedge foreign currency risks on unexecuted firm commitments
and highly probable forecast transactions, are recognised in the financial statements at fair value as on the Balance Sheet date, in
pursuance of the announcement of the Institute of Chartered Accountants of India (ICAI) dated March 29, 2008 on accounting of
derivatives. The Company has adopted Accounting Standard (AS) 30 ["Financial Instruments: Recognition and Measurement"] for
accounting of such derivative contracts, not covered under Accounting Standard (AS) 11 ["The Effects of Changes in Foreign Exchange
Rates"], as mandated by the ICAI in the aforesaid announcement.
Accordingly, the resultant gains or losses on fair valuation/settlement of the derivative contracts covered under Accounting Standard
(AS) 30 ["Financial Instruments: Recognition and Measurement"] are recognised in the Profit and Loss Account or Balance Sheet as
the case may be after applying the test of hedge effectiveness. The gains or losses are recognised in the Balance Sheet where the
hedge is effective, while the same is recognised in the Profit and Loss Account where the hedge is ineffective. The premium paid/
received on a foreign currency forward contract is accounted as expense/income over the period of the contract.
17. Segment accounting
a)
Segment accounting policies
Segment accounting policies are in line with the accounting policies of the Company. In addition, the following specific accounting
policies have been followed for segment reporting:
i)
ii)
Segment revenue includes sales and other income directly identifiable with/allocable to the segment including inter segment
revenue.
Expenses that are directly identifiable with/allocable to segments are considered for determining the segment result. Expenses
which relate to the Company as a whole and not allocable to segments are included under "unallocable corporate expenditure."
iii)
Income which relates to the Company as a whole and not allocable to segments is included in "unallocable corporate income".
iv) Segment result includes margins on inter-segment capital jobs, which are reduced in arriving at the profit before tax of the
v)
Company.
Segment assets and liabilities include those directly identifiable with the respective segments. Unallocable corporate assets and
liabilities represent the assets and liabilities that relate to the Company as a whole and not allocable to any segment. Unallocable
assets mainly comprise trade investments in subsidiaries and associate companies that constitute or relate to the portfolio of the
Company's core/thrust areas of business such as infrastructure development and software solutions. Unallocable liabilities
include mainly loan funds, provisions for employee retirement benefits and proposed dividend.
b)
Inter-segment transfer pricing
Segment revenue resulting from transactions with other business segments is accounted on the basis of transfer price agreed between
the segments. Such transfer prices are either determined to yield a desired margin or agreed on a negotiated basis.
134
Schedules forming part of the Accounts (contd.)
18. Taxes on income
Tax on income for the current period is determined on the basis of taxable income and tax credits computed in accordance with the
provisions of the Income Tax Act, 1961, and based on the expected outcome of assessments/appeals.
Deferred tax is recognised on timing differences between the income accounted in financial statements and the taxable income for the year,
and quantified using the tax rates and laws enacted or substantively enacted as on the Balance Sheet date.
Deferred tax assets relating to unabsorbed depreciation/business losses/losses under the head "capital gains" are recognised and carried
forward to the extent there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets
can be realised.
Other deferred tax assets are recognised and carried forward to the extent that there is a reasonable certainty that sufficient future taxable
income will be available against which such deferred tax assets can be realised.
19. Fringe benefit tax
Fringe benefit tax (FBT) on the employee stock options (ESOPs) is recognised in the Profit and Loss Account when the liability crystalises
upon vesting of such stock options. Wherever such FBT liability is borne by the employee, the same is not so recognised.
FBT on all the other expenses, as specified in the Income Tax Act, 1961, is recognised in the Profit and Loss Account when the underlying
expenses are incurred.
20. Accounting for interests in joint ventures
Interests in joint ventures are accounted as follows:
Type of joint venture
Accounting treatment
Jointly controlled operations
Company's share of revenues, common expenses, assets and liabilities are included in revenues,
expenses, assets and liabilities respectively.
Jointly controlled assets
Share of the assets, according to nature of the assets, and share of the liabilities are shown as part of
gross block and liabilities respectively. Share of expenses incurred on maintenance of the assets is
accounted as expense. Monetary benefits, if any, from use of the assets are reflected as income.
Jointly controlled entities
(a)
Integrated joint ventures:
(i)
(ii)
Company's share in profits or losses of integrated joint ventures is accounted on
determination of the profits or losses by the joint ventures.
Investments in integrated joint ventures are carried at cost net of Company's share in
recognised profits or losses.
(b)
Incorporated jointly controlled entities:
(i)
(ii)
Income on investments in incorporated jointly controlled entities is recognised when the
right to receive the same is established.
Investment in such joint ventures is carried at cost after providing for any permanent
diminution in value.
Joint venture interests accounted as above, other than investments in incorporated jointly controlled entities, are included in the segments
to which they relate.
21. Provisions, contingent liabilities and contingent assets
Provisions are recognised for liabilities that can be measured only by using a substantial degree of estimation, if
(a)
the Company has a present obligation as a result of a past event,
(b) a probable outflow of resources is expected to settle the obligation; and
(c)
the amount of the obligation can be reliably estimated.
Reimbursement expected in respect of expenditure required to settle a provision is recognised only when it is virtually certain that the
reimbursement will be received.
Contingent liability is disclosed in case of
(a) a present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle the
obligation;
(b) a present obligation arising from past events, when no reliable estimate is possible;.
(c) a possible obligation arising from past events where the probability of outflow of resources is not remote.
Contingent assets are neither recognised, nor disclosed.
Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet date.
135
Notes forming part of the Accounts
1.
a) Of the equity shares of Rs.2 each comprised in the subscribed and paid-up capital of the Company:
i)
ii)
iii)
9,19,943 (previous year: 9,19,943) equity shares were allotted as fully paid-up, pursuant to contracts, without payment being
received in cash.
44,96,76,280 (previous year: 15,70,84,226) equity shares were issued as bonus shares by way of capitalisation of general
reserve: Rs.2.35 crore (previous year: Rs.2.35 crore), securities premium: Rs.87.47 crore (previous year: Rs.28.97 crore) and
capital redemption reserve: Rs.0.12 crore (previous year: Rs.0.10 crore).
1,48,67,485 (previous year: 1,40,99,067) equity shares were allotted as fully paid up on exercise of grants under Employees
Stock Ownership Schemes.
b) Options outstanding as at the end of the year on un-issued share capital:
Particulars
Employee stock options granted and outstanding#
Number of equity shares to be issued as fully paid
As at 31-3-2009
2,12,89,375
As at 31-3-2008
90,58,363
# The number of options have been adjusted consequent to bonus issue wherever applicable.
c)
The directors recommend payment of final dividend of Rs.10.50 per equity share of Rs.2 each on the number of shares outstanding as
on the record date. Provision for final dividend has been made in the books of account for 58,56,87,862 shares outstanding as at
March 31, 2009 amounting to Rs.614.97 crore.
Stock option schemes
a)
The grant of options to the employees under the stock option schemes is on the basis of their performance and other eligibility criteria.
The options are vested equally over a period of four years [5 years in the case of Series 2006(A)], subject to the discretion of the
management and fulfilment of certain conditions.
The details of the grants under the aforesaid schemes under various series are summarised below:
b)
Series reference
Sr.
no.
1 Grant price (prior to
2000
2002 (A)
2002 (B)
2003 (A)
2003(B)
2006
2006(A)
2008-2009
2007-2008
2008-2009
2007-2008
2008-2009
2007-2008
2008-2009
2007-2008
2008-2009
2007-2008
2008-2009
2007-2008
2008-2009
2007-2008
bonus issue)-Rupees
Grant price (post
bonus issue)-Rupees
Grant dates
7
–
7
3.50
1-6-2000
7
–
7
3.50
19-4-2002
7
3.50
19-4-2002
Vesting commences on
1-6-2001
19-4-2003
19-4-2003
2
3
7
–
35
17.50
35
–
35
17.50
35
–
1202
601
23-5-2003
onwards
23-5-2004
onwards
23-5-2003
onwards
23-5-2004
onwards
1-9-2006
onwards
1-9-2007
onwards
–
601
1-7-2007
onwards
1-7-2008
onwards
1202
1202
1202
8400
8400
10750
10750
19850
19850
15726
33216
971468
1299885
7036899
10671500
995270
–
–
–
8400
16800
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
10750
21500
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
19850
39700
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
15726
31452
–
–
–
–
–
–
–
–
–
40481
340000
118874
1152113
2304226
–
–
–
–
–
163605
59600
120756
6812138
13624276
–
–
–
–
–
1276
–
50912
153800
116041
162390
261900
–
3109350
634670
180428
1910970
25034
2700778
5401556
133664
646295
9214
447226
331766
37516
1159921
19012
7000
–
43000
-
–
–
4 Options granted and outstanding
at the beginning of the year
5 Options lapsed/withdrawn
prior to bonus issue
6 Options granted prior to
bonus issue
7 Options exercised prior to
bonus Issue for which
shares are allotted
8 Options outstanding as on
October 3, 2008 prior to
bonus issue
Adjusted options as on
October 3, 2008 consequent
to bonus issue
9
10 Options lapsed/withdrawn
post bonus issue
11 Options granted post bonus issue
12 Options exercised post bonus
issue for which shares are allotted
13 Options exercised & allocated
against shares earlier allotted*
14 Options granted and outstanding
at the end of the year
of which -
Options vested
Options yet to vest
16800
8400
21500
10750
39700
19850
31452
15726
1959888
971468
13324860
7036899
5895175
995270
16800
–
8400
–
21500
–
10750
–
39700
–
19850
–
31452
–
15726
–
226326
1733562
34666
936802
5321810
8003050
747179
6289720
279136
5616039
–
995270
*Allocated from the shares returned by former nominee directors in accordance with the consent terms approved by the Hon'ble High Court of Bombay on June 14, 2007.
–
–
–
–
–
–
–
–
995270
–
–
2.
136
Notes forming part of the Accounts (contd.)
c) During the year, the Company has recovered Rs.4.80 crore (previous year: Rs.2.60 crore) from its subsidiary companies towards the
stock options granted to their employees, pursuant to the employee stock option schemes.
3.
a) Cash credit facilities including working capital demand loans from banks are secured by hypothecation of stocks, stores and book
debts. The total charge on these assets is Rs.1607.84 crore, including on account of bank guarantees as on March 31, 2009.
b) Other loans and advances from banks grouped under unsecured loans include loans availed from banks outside India amounting to
Rs.46.23 crore secured by corporate guarantee & project-specific receivables.
4.
Terms of redemption of debentures
a)
Secured redeemable non-convertible fixed rate debentures (privately placed):
Sr.
no.
1
Face value per
debenture (Rs.)
10,00,000
Date of
allotment
December 5,
2008
Amount
Rs.crore
500
2
10,00,000
January 5,
2009
Total
400
900
Interest
Redeemable at face value
11.45% p.a.
payable annually
9.15% p.a.
payable annually
At the end of 10th year from the date of allotment.
The Company has call option to redeem
debentures at the end of 5th year from the date
of allotment.
At the end of 10th year from the date of allotment.
Security: The debentures are secured by way of a first charge having pari passu rights on the immovable property at certain locations
and a part of a movable property of a business division, both present and future.
b) Unsecured redeemable non-convertible fixed rate debentures (privately placed):
Sr.
no.
1
Face value per
Debenture (Rs.)
10,00,000
Date of
allotment
January 21,
2009
Total
Amount
Rs.crore
250
250
Interest
Redeemable at face value
9.20% p.a.
payable annually
At the end of 3rd year from the date of allotment.
5.
a)
Fixed deposits with scheduled banks as on March 31, 2009 include Rs.40.41 crore (previous year: Rs.40.41 crore), in respect of a
claim against the Company. The dispute is since resolved in favour of the Company, and the money has been realised on May 6, 2009.
b)
Balances with non-scheduled banks represent the balances with Indian banks classified as non-scheduled banks by the Reserve
Bank of India and with all overseas branches of foreign banks. The balances with non-scheduled banks held in:
Particulars
i)
Current accounts
Abu Dhabi Commercial Bank, Abu Dhabi
Abu Dhabi Commercial Bank, UAE
Abu Dhabi Islamic Bank. UAE
Arab Bank PLC, Amman
Arab Bank PLC, Bahrain
Arab Bank PLC, Jordan
Arab Bank PLC, Doha
Arab Bank PLC, UAE
Bank Muscat
Bank of Baroda (Kenya) Ltd, Kenya
Bank of Bhutan
Bank of Commerce & Development, Libya
Bank of Foreign Trade of Russian Federation (as at
31-3-2009: Rs.nil and as at 31-3-2008: Rs.39)
Bank of Nova Scotia, Barbados
Bank Tuanalem, Kazakhstan
Carried forward
As at
As at
Maximum amount outstanding
at any time during
31-3-2009
31-3-2008
2008-2009
2007-2008
Rs.crore
3.18
0.41
0.37
0.11
3.30
0.04
1.04
7.63
0.04
0.28
2.30
0.38
–
–
–
19.08
7.47
20.01
0.02
0.04
1.76
2.48
–
–
–
0.38
2.22
0.38
–
0.99
–
35.75
25.55
20.01
1.28
2.48
6.54
2.48
8.70
9.54
0.04
50.41
2.30
0.38
–
0.99
–
17.79
20.01
0.33
0.04
1.76
3.87
–
–
–
2.39
2.22
0.38
0.17
2.56
0.01
137
Notes forming part of the Accounts (contd.)
i)
Particulars
Current accounts (contd.)
Brought Forward
Citibank, France
Citibank, USA
Citibank, London
Deutsche Bank, Singapore
Emirates Bank, UAE
Emirates Bank International PJSC
Hakrin Bank NV, (USD) Surinam
Hakrin Bank NV, (Guilder) Surinam
Hongkong & Shanghai Banking Corporation (RMD), China
Hongkong & Shanghai Banking Corporation (USD), China
HSBC Bank Middle East Limited, Abu Dhabi
HSBC Bank Middle East Limited, Dubai
HSBC Bank, Qatar
HSBC Bank, UK
HSBC Bank, UAE
Mashreq Bank, Dubai
Mashreq Bank, UAE
Mizuho Bank, Japan
National Bank of Kuwait, Kuwait
Nepal Investment Bank Ltd., Nepal
Rafidian Bank, Iraq
Standard Chartered Bank, Dubai
Standard Chartered Bank, Malaysia
Standard Chartered Bank, Qatar
Union National Bank, Abu Dhabi
Uttara Bank Limited, Bangladesh
ICICI Bank, Canada
ICICI Bank Eurasia, Moscow
DBS Bank, Singapore
Total (i)
ii) Call deposits
Mashreq Bank, Dubai
Bank of Nova Scotia, Barbados
Total (ii)
iii) Fixed deposits
Bank of Nova Scotia, Barbados
Deutsche Bank, Singapore
Emirates Bank, UAE
HSBC Bank Middle East Ltd, Abu Dhabi
HSBC Bank Middle East Ltd. Dubai
Mashreq Bank, Dubai
Mashreq Bank, UAE
National Bank of Kuwait, Kuwait
Standard Chartered Bank, Qatar
Total (iii)
Total (i) + (ii) + (iii)
As at
As at
Maximum amount outstanding
at any time during
31-3-2009
31-3-2008
2008-2009
2007-2008
Rs.crore
19.08
0.12
5.23
0.23
–
–
14.61
–
–
0.22
0.94
19.32
21.98
18.51
0.84
8.62
8.25
4.47
3.55
4.09
0.14
8.25
–
0.19
8.45
0.27
–
0.05
0.38
0.01
147.80
0.69
–
0.69
–
–
–
–
22.33
–
–
–
–
22.33
170.82
35.75
–
–
–
0.01
1.17
–
0.01
–
0.26
0.37
0.03
0.03
–
–
10.42
0.01
13.24
–
10.40
0.17
8.25
0.13
0.35
2.53
1.81
–
–
0.10
–
85.04
0.69
–
0.69
–
0.92
7.65
1.23
0.30
0.70
4.37
14.69
8.82
38.68
124.41
0.12
32.91
0.23
0.01
1.17
14.61
–
0.02
0.26
0.94
28.61
61.76
18.51
0.85
27.44
13.25
13.24
3.55
51.68
0.17
8.25
0.14
7.74
9.48
1.81
–
0.05
0.43
0.01
0.69
–
–
0.92
7.65
1.23
26.92
2.19
4.37
44.48
8.82
–
–
–
1.15
1.17
41.07
0.01
0.02
0.50
0.70
12.67
15.72
–
–
10.42
20.36
13.24
–
59.56
0.17
8.93
0.81
9.30
14.58
6.03
0.57
–
0.10
–
0.75
7.24
7.23
1.98
7.65
10.28
2.74
197.74
4.37
58.75
8.82
138
Notes forming part of the Accounts (contd.)
c) Call deposit with Mashreq Bank, Dubai, UAE, of Rs.0.69 crore is subject to an escrow arrangement duly approved by the Reserve
Bank of India, whereby the proceeds of the deposit, together with interest thereon, would be applied towards full and final settlement
of loan taken from Rafidian Bank, Iraq, which is included under unsecured loans. Once the UN embargo against Iraq is lifted, the
settlement would be effected.
6.
Loans and advances include:
i)
ii)
iii)
amount due from an officer of the Company: Rs.nil (previous year: Rs.nil). The maximum amount outstanding at any time during the
year was Rs.nil (previous year: Rs.nil).
rent deposit with whole-time directors: Rs.0.03 crore (previous year: Rs.0.06 crore). The maximum amount outstanding at any time
during the year: Rs.0.06 crore (previous year: Rs.0.07 crore).
amount, including interest accrued, due from the managing director and whole-time directors in respect of housing loan: Rs.0.63 crore
(previous year: Rs.0.73 crore). Maximum amount outstanding at any time during the year: Rs.0.73 crore (previous year: Rs.0.76 crore).
7.
8.
Sundry creditors - others include Rs.1.13 crore (previous year: Rs.17.67 crore), being contribution received from the employees of the
Company and some of its subsidiary & associate companies, on behalf of L&T Employees Welfare Foundation Trust and held on account
for it.
Sales and service include Rs.117.72 crore (previous year: Rs.75.10 crore) for price variations net of liquidated damages in terms of
contracts with the customers and shipbuilding subsidy Rs.25.49 crore (previous year: Rs.29.29 crore).
9. Disclosures pursuant to Accounting Standard (AS) 7 (Revised) “Construction Contracts”:
i)
ii)
Contract revenue recognised for the financial year
Particulars
Aggregate amount of contract costs incurred and recognised profits (less recognised
losses) as at end of the financial year for all contracts in progress as at that date
iii)
Amount of customer advances outstanding for contracts in progress as at end of the financial year
iv) Retention amounts due from customers for contracts in progress as at end of the financial year
Rs.crore
2008-2009
2007-2008
27456.22
18441.11
44032.27
33037.24
4440.91
1741.43
3121.16
1434.17
10. Extraordinary items during the year comprise the following:
i.
ii.
Gain of Rs.958.74 crore (net of tax of Rs.282.08 crore) on sale of the Company's Ready Mix Concrete business.
Provision of Rs.186.28 crore in respect of investment in Satyam Computer Services Limited (SCSL) held by the Company as well as
by its wholly owned subsidiary, L&T Capital Company Limited (LTCCL). This provision has been made by the Company as a measure
of abundant caution and in consonance with its commitment to acquire the investment from LTCCL at book value, as and when such
transfer of shares is permitted/takes place. Considering the extraordinary circumstances under which the price of SCSL shares fell in
the market, the aforesaid provision has been created based on the principles of "prudence". [see note no.23]
11. Other income for the previous year ended March 31, 2008 included profit on disposal of stake in a subsidiary company amounting to
Rs.87.23 crore.
12. Disclosure pursuant to Accounting Standard (AS) 15 (Revised) “Employee Benefits”:
i.
Defined contribution plans: [refer accounting policy no.4b(i)]
Amount of Rs.62.50 crore (previous year: Rs.54.15 crore) is recognised as an expense and included in "staff expenses" (Schedule N)
in the Profit and Loss Account.
139
Notes forming part of the Accounts (contd.)
ii.
Defined benefit plans: [refer accounting policy no.4b(ii)]
a)
The amounts recognised in Balance Sheet are as follows:
Particulars
A) Present value of defined benefit obligation
– Wholly funded
– Wholly unfunded
Less: Fair value of plan assets
Less: Unrecognised past service costs
Amount to be recognised
as liability or (asset)
B) Amounts reflected in the Balance Sheet
Gratuity plan
Post-retirement
medical benefit plan
Company
pension plan
Trust-managed
provident fund plan
Rs.crore
As at
As at
31-3-2009 31-3-2008 31-3-2009 31-3-2008 31-3-2009 31-3-2008 31-3-2009 31-3-2008
As at
As at
As at
As at
As at
As at
272.41
230.57
0.52
272.93
244.71
–
0.45
231.02
203.42
–
–
72.40
72.40
–
1.43
–
58.24
58.24
–
1.57
–
152.78
152.78
–
0.98
– 1001.10
903.75
152.44
–
–
152.44 1001.10
903.75
– 1017.06
904.29
1.09
–
–
28.22
27.60
70.97
56.67
151.80
151.35 (15.96) @ (0.54) @
Liabilities
Assets
28.22
27.60
70.97
56.67
151.80
151.35
14.78
–
–
–
–
–
–
–
9.60
–
Net liability/(asset)
28.22
27.60
70.97
56.67
151.80
151.35
14.78 #
9.60 #
b)
The amounts recognised in Profit and Loss Account are as follows:
Particulars
1. Current service cost
2.
Interest cost
3. Expected return on plan assets
4. Actuarial losses/(gains)
5. Past service cost
6. Effect of any curtailment or settlement
7. Actuarial gain/(loss) not recognised in books
8. Adjustment for earlier years
Total included in "staff expenses" (1 to 8)
Actual return on plan assets
Rs.crore
Gratuity plan
Post-retirement
medical benefit plan
Company
pension plan
Trust-managed
provident fund plan
2008-2009 2007-2008 2008-2009 2007-2008 2008-2009 2007-2008 2008-2009 2007-2008
15.29
19.01
14.16
16.66
(15.21)
(11.35)
8.56
7.88
–
–
–
–
–
–
–
–
3.39
5.06
–
9.03
0.14
–
–
–
2.70
3.95
–
0.41
5.38
–
–
–
27.65
28.34
27.35
17.60
17.62
12.44
–
–
4.55
13.01
–
5.18
0.11
(19.57)
–
–
3.28
–
3.51
39.74**
41.65**
10.07
77.25
69.78
–
(78.51)
(71.01)
21.65
(19.65)
11.64
0.11
–
–
–
35.34
–
–
–
–
–
20.91+
(10.41)
–
39.74
98.16
–
41.65
59.37
140
Notes forming part of the Accounts (contd.)
c)
The changes in the present value of defined benefit obligation representing reconciliation of opening and closing balances
thereof are as follows:
Particulars
Opening balance of the present value of
defined benefit obligation
Add: Current service cost
Add: Interest cost
Add: Contribution by plan participants
i) Employer
ii) Employee
iii) Transfer-in
Add: Actuarial losses
Less: Benefits paid
Add: Past service cost
Less: Effect of any curtailment or settlement
Closing balance of the present value of
defined benefit obligation
Gratuity plan
Post-retirement
medical benefit plan
Company
pension plan
Trust-managed
provident fund plan
Rs.crore
As at
As at
31-3-2009 31-3-2008 31-3-2009 31-3-2008 31-3-2009 31-3-2008 31-3-2009 31-3-2008
As at
As at
As at
As at
As at
As at
231.02
203.45
15.29
19.01
14.16
16.66
–
–
–
–
–
0.15~
21.69
14.13
(14.08)
(17.53)##
–
–
–
–
58.24
3.39
5.06
–
–
–
9.03
(3.32)
–
–
46.36
152.44
119.76
903.75
827.24
2.70
3.96
4.55
13.01
3.51
10.07
39.74**
41.65**
77.25
69.78
–
–
–
0.41
(2.14)
6.95
–
–
–
5.18
(2.83)
–
–
(19.57)
–
–
–
21.64
(2.54)
–
–
–
70.72
–
–
–
83.77
–
–
(90.36)
(118.69)
–
–
–
–
272.93
231.02
72.40
58.24
152.78
152.44 1001.10
903.75
d) Changes in the fair value of plan assets representing reconciliation of the opening and closing balances thereof are as follows:
Rs.crore
Particulars
Gratuity plan
Trust-managed
provident fund plan
Opening balance of the fair value of the plan assets
Add: Expected return on plan assets*
Add/(less): Actuarial gains/(losses)
Add: Contribution by the employer
Add: Contribution by plan participants
Less: Benefits paid
Add: Business combinations
Less: Settlements
Closing balance of the plan assets
As at
31-3-2009
As at
31-3-2008
203.42
152.93
As at
31-3-2009
904.29
15.21
13.13
27.03
–
(14.08)
–
–
11.35
6.25
50.27
0.15~
(17.53)##
–
–
As at
31-3-2008
839.86
71.01
(11.64)
44.59
79.16
78.51
19.65
34.94
70.03
(90.36)
(118.69)
–
–
–
–
244.71
203.42
1017.06
904.29
Notes: The fair value of the plan assets under the trust-managed provident fund plan has been determined at amounts based
on their value at the time of redemption, assuming a constant rate of return to maturity.
*
Basis used to determine the overall expected return:
The trust formed by the Company manages the investments of provident funds and gratuity fund. Expected return on plan assets
is determined based on the assessment made at the beginning of the year on the return expected on its existing portfolio, along
with the estimated increment to the plan assets and expected yield on the respective assets in the portfolio during the year.
The Company expects to fund Rs.27.70 crore (previous year: Rs.27.15 crore) towards its gratuity plan and Rs.43.80 crore
(previous year: Rs.44.15 crore) towards its trust-managed provident fund plan during the year 2009-2010.
@ Asset is not recognised in the Balance Sheet
#
**
+
~
## Benefits paid includes an amount of Rs.0.29 crore transferred to subsidiary companies
Employer's and employees' contribution (net) for March is paid in April
Employer's contribution to provident fund
The actual return on plan assets is higher than interest cost, but no credit has been taken to the Profit and Loss Account
Amounts transferred from subsidiary companies - Rs.0.15 crore
141
Notes forming part of the Accounts (contd.)
e)
The major categories of plan assets as a percentage of total plan assets are as follows:
Particulars
Gratuity plan
Trust-managed
provident fund plan
As at
As at
31-3-2009 31-3-2008 31-3-2009 31-3-2008
As at
As at
Government of India securities
State government securities
Corporate bonds
Equity shares of listed companies
Fixed deposits under special deposit scheme framed by central government
for provident funds
Insurer managed funds
Public sector unit bonds
Others
41%
39%
–
38%
1%
14%
2%
–
4%
–
38%
1%
16%
2%
–
4%
23%
13%
5%
–
22%
13%
5%
–
27%
30%
–
–
32%
30%
–
–
f)
Principal actuarial assumptions at the Balance Sheet date (expressed as weighted averages):
1
Discount rate:
a) Gratuity plan
2
3
4
b) Company pension plan
c)
Post-retirement medical benefit plan
Expected return on plan assets
Annual increase in healthcare costs (see note below)
Salary growth rate:
a) Gratuity plan
b) Company pension plan
5
Attrition rate:
As at 31-3-2009
As at 31-3-2008
7.67%
7.67%
7.67%
7.50%
5.00%
6.00%
7.00%
8.33%
8.35%
8.39%
7.50%
5.00%
6.00%
7.00%
a)
For post-retirement medical benefit plan & company pension plan, the attrition rate varies from 2% to 8% (previous
year: 2% to 8%) for various age groups.
b)
For gratuity plan the attrition rate varies from 1% to 7% (previous year: 1% to 7%) for various age groups
6
7
8
9
The estimates of future salary increases, considered in actuarial valuation, take into account inflation, seniority, promotion
and other relevant factors, such as supply and demand in the employment market.
The interest payment obligation of trust-managed provident fund is assumed to be adequately covered by the interest
income on long term investments of the fund. Any shortfall in the interest income over the interest obligation is recognised
immediately in the Profit and Loss Account as actuarial losses.
The obligation of the Company under the post-retirement medical benefit plan is limited to the overall ceiling limits. At
present, healthcare cost, as indicated in the principal actuarial assumption given above, has been assumed to increase at
5% p.a.
A one percentage point change in assumed healthcare cost trend rates would have the following effects on the aggregate
of the service cost and interest cost and defined benefit obligation:
Particulars
Effect on the aggregate of the service cost and interest cost
Effect on defined benefit obligation
Rs.crore
Effect of 1% increase Effect of 1% decrease
2008-2009 2007-2008 2008-2009 2007-2008
0.74
4.60
0.60
4.00
(1.18)
(3.76)
(0.99)
(3.30)
142
Notes forming part of the Accounts (contd.)
g)
The amounts pertaining to defined benefit plans are as follows:
Particulars
As at 31-3-2009 As at 31-3-2008 As at 31-3-2007
Rs.crore
1 Post-retirement medical benefit plan (unfunded)
Defined benefit obligation
Experience adjustment plan liabilities
2 Gratuity plan (funded/unfunded)
Defined benefit obligation
Plan assets
Surplus/(deficit)
Experience adjustment plan liabilities
Experience adjustment plan assets
3 Post-retirement pension plan (unfunded)
Defined benefit obligation
Experience adjustment plan liabilities
4 Trust managed provident fund plan (funded)
Defined benefit obligation
Plan assets
Surplus/(deficit)
h) General descriptions of defined benefit plans:
1. Gratuity plan:
70.97
1.13
272.93
244.71
(28.22)
8.38
13.71
151.80
(6.89)
1001.10
1017.06
15.96
56.67
2.66
231.02
203.42
(27.60)
16.44
(2.92)
151.35
26.87
903.75
904.29
0.54
46.36
–
203.45
152.93
(50.52)
25.84
6.59
118.56
–
827.24
839.86
12.62
The Company operates gratuity plan through a trust wherein every employee is entitled to the benefit equivalent to fifteen
days salary last drawn for each completed year of service. The same is payable on termination of service or retirement
whichever is earlier. The benefit vests after five years of continuous service. The Company's scheme is more favourable as
compared to the obligation under Payment of Gratuity Act, 1972. A small part of the gratuity plan, which is not material, is
unfunded and managed within the Company.
2.
Post-retirement medical care plan:
The post-retirement medical benefit plan provides for reimbursement of health care costs to certain categories of employees
post their retirement. The reimbursement is subject to an overall ceiling sanctioned based on cadre of the employee at the
time of retirement.
3. Company's pension plan:
In addition to contribution to state-managed pension plan (EPS scheme), the Company operates a post retirement pension
scheme, which is discretionary in nature for certain cadres of employees. The quantum of pension depends on the cadre of
the employee at the time of retirement.
4.
Trust managed provident fund plan:
The Company manages provident fund plan through a provident fund trust for its employees which is permitted under the
Provident Fund and Miscellaneous Provisions Act, 1952. The plan envisages contribution by employer and employees and
guarantees interest at the rate notified by the provident fund authority. The contribution by employer and employee together
with interest are payable at the time of separation from service or retirement whichever is earlier. The benefit under this plan
vests immediately on rendering of service.
13. Uncalled liability on shares partly paid is Rs.66.44 crore net of advance paid against equity commitment (previous year: Rs.82.63 crore).
143
Notes forming part of the Accounts (contd.)
14. Disclosures in respect of joint ventures
a)
List of joint ventures
Sr.
no.
1
2
Name of joint venture
Description of interest/
(description of job)
L&T-Hochtief Seabird Joint Venture
Integrated joint venture
(Construction of breakwater at Karwar)
International Metro Civil Contractors Integrated joint venture
3 HCC-L&T Purulia Joint Venture
4 Desbuild-L&T Joint Venture
5 Bauer-L&T Diaphragm Wall
Joint Venture
6
7
Larsen & Toubro Limited -
Shapoorji Pallonji & Co. Limited
Joint Venture (Ebene Cybercity)
Larsen & Toubro Limited -
Shapoorji Pallonji & Co. Limited
Joint Venture
(Les Pailles Exhibition Centre)
8
L&T-AM Tapovan Joint Venture
9
L&T-Shanghai Urban Corporation
Group Joint Venture
10 L&T-Eastern Joint Venture
11 Metro Tunnelling Group
12 L&T-KBL (UJV) Hyderabad
13 L&T-HCC Joint Venture
14 Patel-L&T Consortium
15 L&T-SVEC Joint Venture
16 L&T-KBL-MAYTAS UJV
17 Consortium of Samsung Heavy
Industries Co. Ltd., Korea and L&T
(Construction of Delhi metro corridor
phase I tunnel project)
Integrated joint venture
(Construction of pumped storage project)
Integrated joint venture
(Renovation of US consulate, Chennai)
Integrated joint venture
(Construction of diaphragm wall for
International Metro Civil Contractors)
Integrated joint venture
(Execution of civil & associated works for
Ebene Cybercity Project, Mauritius)
Integrated joint venture
(Execution of civil & associated works for
Les Pailles Exhibition Centre, Mauritius)
Integrated joint venture
(Construction of head race tunnel for
Tapovan Vishnugad Hydro Electric Project
at Chamoli, Uttaranchal)
Jointly controlled entity (Construction of
twin tunnel between IGI airport and
sector 21 for DMRC)
Jointly controlled entity
(Construction and maintenance of
295 residential units at Dubai)
Integrated joint venture
(Construction of Delhi metro corridor
- phase II tunnel project)
Jointly controlled operation
(Investigation, design, supply and
erection for lift irrigation system)
Jointly controlled operation
(Four laning and strengthening of
existing two lane sections from
240 Km to 320 Km on NH 2)
Jointly controlled operation
(Hydro Electric Project)
Jointly controlled operation
(Lift Irrigation Project at Hyderabad)
Jointly controlled operation
(Transmission of 735 MId treated water
associated with all civil, electrical &
mechanical work at Hyderabad)
Jointly controlled operations (Execution
of Vasai East Development Project of
ONGC Ltd.)
144
Proportion of
ownership
interest
Country of
residence
0.90
0.26
0.43
0.49
0.50
0.50
0.50
India
India
India
India
India
Mauritius
Mauritius
0.65
India
0.51
0.65
0.26
–
–
–
–
–
–
India
UAE
India
India
India
India
India
India
India
Notes forming part of the Accounts (contd.)
Sr.
no.
Name of joint venture
18 Consortium of Global Industries
Offshore LLC, USA and L&T
19 Lurgi L&T KQKS Consortium
20 Consortium of Toyo Engineering
Company and L&T
21 L&T and Scomi Engineering
BHD. Joint Venture
Description of interest/
(description of job)
Jointly controlled operations (Execution
of pipeline replacement project of ONGC)
Jointly controlled operations (Execution
of Melaka Group 3 Lubricant Base Oil
Plant for Petronas)
Jointly controlled operations (Execution
of Naptha Cracker Associated Unit for
IOCL, Panipat)
Jointly controlled operations (Implementation
of Monorail System in Mumbai)
Proportion of
ownership
interest
–
–
–
–
Country of
residence
India
Malaysia
India
India
Country of incorporation not applicable for the above joint ventures as these are unincorporated joint ventures
b)
Financial interest in jointly controlled entities
Name of the joint venture
Assets
Liabilities
Income
Expenses
Tax
As at March 31, 2009
For the year 2008-2009
Company's share of
Rs.crore
Sr.
no.
1
2
3
4
5
6
7
8
9
10
L&T-Valdel Engineering Private Limited
L&T-Demag Plastics Machinery Limited
L&T-Hochtief Seabird Joint Venture
International Metro Civil Contractors Joint Venture
HCC-L&T Purulia Joint Venture
Desbuild-L&T Joint Venture
Bauer-L&T Diaphragm Wall Joint Venture
Larsen & Toubro Limited - Shapoorji Pallonji &
Company Limited Joint Venture (Ebene-Cybercity)
Larsen & Toubro Limited - Shapoorji Pallonji & Company
Limited Joint Venture (Les Pailles Exhibition Centre)
L&T-AM Tapovan Joint Venture
11 Metro Tunnelling Group Joint Venture
12
L&T-Eastern Joint Venture
13
L&T-Shanghai Urban Corporation Group Joint Venture
TOTAL
Share of net assets/profit after tax
in jointly controlled entities
–
(–)
–
(51.87)
12.55
(9.08)
12.56
(11.51)
6.96
(7.22)
0.08
(0.07)
–~
(0.08)
3.64
(3.92)
1.95
(2.04)
199.95
(57.55)
34.93
(29.74)
152.94
(81.10)
69.84
(15.19)
495.40
(269.37)
127.49
(80.78)
–
(–)
–
(46.94)
0.38
(0.40)
3.72
(4.01)
4.44
(4.61)
–$
(–)$$
–**
(–)(cid:3)
3.91
(3.91)
1.60
(1.68)
130.07
(6.84)
26.68
(26.30)
141.00
(78.87)
56.11
(15.03)
367.91
(188.59)
–
(4.74)
43.26
(52.02)
–
(–)
0.60
(1.41)
0.06
(0.93)
0.01
(–)
–
(0.01)
–
(0.31)
–
(0.19)
54.83
(25.39)
59.65
(39.34)
246.31
(9.95)
70.50
(0.77)
475.22
(135.06)
7.45
(-9.87)
–
(3.47)
46.45
(61.35)
0.02
(0.05)
1.44
(1.15)
0.18
(5.17)
–^
(–)^^
0.02
(0.01)
0.18
(–)
–
(–)
55.44
(24.85)
58.10
(38.95)
236.35
(9.64)
68.06
(0.73)
466.24
(145.37)
Amounts less than Rs.0.01 crore:
Current year: # Rs.3180, @Rs.4945, $Rs.8107, ^Rs.11145, *Rs.5394,. ~Rs.44014, **Rs.43259,
Previous year: $$(Rs.8258), ^^(Rs.27540), (cid:2) (Rs.43259), ¤(Rs.10226)
Rs.58935, (cid:2) Rs.13283,
–
(0.23)
0.04
(-0.83)
–
(–)
–#
(0.09)
–@
(-0.60)
– *
(–)
–(cid:2)
(–)¤
–
(0.10)
–
(0.06)
0.05
(0.23)
0.58
(0.16)
–
(0.11)
0.86
(0.01)
1.53
(-0.44)
145
Notes forming part of the Accounts (contd.)
Notes:
i.
ii.
iii.
iv.
v.
Figures in brackets relate to previous year.
Item nos.3 to 13 above are integrated joint ventures/jointly controlled entities
Figures for the current year in respect of L&T-Demag Plastics Machinery Limited (LTDPML) relate to the period up to March 30,
2009. LTDPML has become a subsidiary of the Company on March 31, 2009.
Figures for the previous year in respect of L&T-Valdel Engineering Private Limited relate to the period up to July 3, 2007, from
which date it has become a subsidiary of the Company
Contingent liabilities, if any, incurred in relation to interests in joint ventures as at March 31, 2009: Rs.nil (previous year: Rs.nil); and
share in contingent liabilities incurred jointly with other ventures as at March 31, 2009: Rs.nil (previous year: Rs.nil)
vi. Share in contingent liabilities of joint ventures themselves for which the Company is contingently liable as on March 31, 2009:
Rs.82.01 crore (previous year: Rs.45.21 crore)
vii. Contingent liabilities in respect of liabilities of other ventures of joint ventures as at March 31, 2009: Rs.nil (previous year: Rs.nil)
viii. Capital commitments, if any, in relation to interests in joint ventures as at March 31, 2009: Rs.nil (previous year: Rs.nil)
15. Loans and advances include:
a) Rs.161 crore (previous year: Rs.200 crore) under “advances recoverable in cash or in kind” towards interest free loan to L&T Employees
Welfare Foundation Trust to part-finance its acquisition of equity shares in the Company held by Grasim Industries Limited and its
subsidiary. The loan is repayable in 9 years commencing from May 2005 with a minimum repayment of Rs.25 crore in a year.
b) Rs.nil (previous year: Rs.43.33 crore) net of provisions, being portfolio of financial assets (comprising lease/hire purchase receivables
and term loans) purchased from L&T Finance Limited, a subsidiary of the Company, in earlier years.
16. Particulars in respect of loans and advances in the nature of loans as required by the listing agreement:
Name of the company/firm/director
(a) Loans and advances in the nature of loans given to subsidiaries:
Larsen & Toubro Infotech Limited
1
2
India Infrastructure Developers Limited
3 Bhilai Power Supply Company Limited
4
5
6
7
8
9
10 L&T-MHI Boilers Private Limited
11 L&T Infrastructure Finance Co. Limited
Tractor Engineers Limited
L&T Finance Limited
International Seaport Dredging Private Limited
L&T Capital Company Limited
L&T Seawoods Private Limited
L&T Infrastructure Development Projects Limited
TOTAL
(b) Loans and advances in the nature of loans given to associates:
1
L&T-Case Equipment Private Limited
TOTAL
(c) Loans and advances in the nature of loans where repayment schedule
is not specified/is beyond 7 years:
1
India Infrastructure Developers Limited
2 Bhilai Power Supply Company Limited
3
L&T Capital Company Limited
TOTAL
(d) Loans and advances in the nature of loans where interest is not
charged or charged below bank rate:
India Infrastructure Developers Limited
1
2 Bhilai Power Supply Company Limited
3
L&T Capital Company Limited
TOTAL
Balance as at
31-3-2009
31-3-2008
Rs.crore
Maximum
outstanding during
2008-2009
2007-2008
–
–
7.19
32.85
–
11.83
770.81
589.94
35.00
–
–
1447.62
5.00
5.00
–
7.19
770.81
778.00
–
7.19
770.81
778.00
–
–
7.19
5.32
–
10.97
75.00
–
–
–
–
98.48
10.00
10.00
–
7.19
75.00
82.19
–
7.19
75.00
82.19
24.85
38.93
7.19
32.85
500.00
10.97
770.81
589.94
35.00
10.00
100.00
–
36.33
7.19
5.32
800.00
10.97
75.00
–
–
–
–
10.00
15.00
–
7.19
770.81
38.93
7.19
770.81
36.33
7.19
75.00
36.33
7.19
75.00
Note:
Loans to employees (including directors) under various schemes of the Company (such as housing loan, furniture loan, education
loan, etc.) have been considered to be outside the purview of disclosure requirements.
146
Notes forming part of the Accounts (contd.)
17. Segment reporting:
a)
Information about business segments (Information provided in respect of revenue items for the year ended March 31, 2009 and in
respect of assets/liabilities as at March 31, 2009 - denoted as "CY" below, previous year denoted as "PY")
i)
Primary segments (business segments):
Particulars
Revenue - including excise duty
External
Inter-segment
Total revenue
Result
Segment result
Less: Inter-segment margins on
capital jobs
Unallocated corporate income/
(expenditure) [net]
Operating profit (PBIT)
Interest expense
Interest income
Profit before tax (PBT)
Provision for current tax
Provision for deferred tax
Provision for fringe benefit tax
Profit after tax
(before extraordinary items)
Profit from extraordinary items
Profit after tax
(after extraordinary items)
Other information
Segment assets
Unallocable corporate assets
Total assets
Segment liabilities
Unallocable corporate liabilities
Total liabilities
Capital expenditure
Depreciation (including obsolescence,
amortisation and impairment)
included in segment expense
Non-cash expenses other than
depreciation included in
segment expense
Engineering
& Construction
Electrical
& Electronics
Machinery &
Industrial Products
Others
Elimination
Total
CY
PY
CY
PY
CY
PY
CY
PY
CY
PY
CY
PY
Rs.crore
28192.86 19178.04
2655.21
2598.60
2437.75
2386.71
1039.02
1178.86
–
–
34324.84 25342.21
512.26
311.05
122.68
77.30
37.31
29.70
47.68
128.94
(719.93)
(546.99)
–
–
28705.12 19489.09
2777.89
2675.90
2475.06
2416.41
1086.70
1307.80
(719.93)
(546.99)
34324.84 25342.21
3447.91
2332.81
316.68
398.73
466.34
431.01
51.84
98.29
–
–
4282.77
3260.84
56.39
55.04
4226.38
3205.80
(107.57)
(12.15)
4118.81
3193.65
(350.22)
(122.66)
171.82
84.48
3940.41
3155.47
1167.03
892.79
10.44
53.74
19.95
69.31
2709.20
2173.42
772.46
–
3481.66
2173.42
19990.66 13938.18
1784.71
1639.75
1120.83
1071.81
301.60
573.87
13373.47
9831.01
538.13
625.62
708.09
633.30
116.30
237.77
1702.89
1181.64
111.84
196.09
214.12
140.71
30.83
22.97
73.44
14.34
76.01
10.47
10.46
14.83
60.76
15.01
94.05
48.16
13.90
6.79
10.08
4.71
8.23
5.95
–
–
–
–
23197.80 17223.61
14095.49
9936.89
37293.29 27160.50
14735.99 11327.70
10097.61
6277.72
24833.60 17605.42
147
Notes forming part of the Accounts (contd.)
ii)
Secondary segments (geographical segments):
Particulars
Domestic
Overseas
CY
PY
CY
PY
Rs.crore
Total
CY
PY
External revenue by location of customers
27810.59
21194.68
6514.25
4147.53
34324.84
25342.21
Carrying amount of segment assets by location of assets
20757.13
15627.17
2440.67
1596.44
23197.80
17223.61
Cost incurred on acquisition of tangible and intangible fixed assets
1884.18
1511.66
14.45
2.84
1898.63
1514.50
b)
Segment reporting: Segment identification, reportable segments and definition of each reportable segment:
i)
Primary/secondary segment reporting format:
(a) The risk-return profile of the Company's business is determined predominantly by the nature of its products and services.
(b)
Accordingly, the business segments constitute the primary segments for disclosure of segment information.
In respect of secondary segment information, the Company has identified its geographical segments as (i) Domestic and (ii)
Overseas. The secondary segment information has been disclosed accordingly.
ii)
Segment identification:
Business segments have been identified on the basis of the nature of products/services, the risk-return profile of individual
businesses, the organisational structure and the internal reporting system of the Company.
iii) Reportable segments:
Reportable segments have been identified as per the criteria specified in Accounting Standard (AS) 17 “Segment Reporting”.
iv) Segment composition:
•
Engineering & Construction Segment comprises execution of engineering and construction projects in India/abroad to
provide solutions in civil, mechanical, electrical and instrumentation engineering (on turnkey basis or otherwise) to core/
infrastructure sectors including railways, shipbuilding and supply of complex plant and equipment to core sectors. The
segment capabilities include basic/detailed engineering, equipment fabrication/supply, erection & commissioning,
procurement/construction and project management.
Electrical & Electronics Segment comprises manufacture and sale of low and medium voltage switchgear and control
gear, custom-built switchboards, petroleum dispensing pumps & systems, electronic energy meters/protection (relays)
systems, control & automation products and medical equipment.
Machinery & Industrial Products Segment comprises manufacture and sale of industrial machinery & equipment, marketing
of industrial valves, construction equipment and welding/industrial products.
Others include (a) ready mix concrete (b) property development activity and (c) e-engineering services & embedded systems.
18. Disclosure of related parties/related party transactions:
i.
List of related parties over which control exists
Sr. no. Name of the related party
Relationship
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
Tractor Engineers Limited
L&T Finance Limited
L&T Capital Company Limited
Larsen & Toubro Infotech Limited
Larsen & Toubro Infotech GmbH
L&T Transportation Infrastructure Limited
L&T PNG Tollway Private Limited
Narmada Infrastructure Construction Enterprise Limited
L&T Western India Tollbridge Limited
India Infrastructure Developers Limited
Larsen & Toubro LLC
Larsen & Toubro International FZE
L&T Infrastructure Development Projects Limited
L&T Infocity Limited
Hyderabad International Trade Expositions Limited
Andhra Pradesh Expositions Private Limited
Wholly owned subsidiary
Wholly owned subsidiary of L&T Capital Holdings Limited
Wholly owned subsidiary
Wholly owned subsidiary
Wholly owned subsidiary of Larsen & Toubro Infotech Limited
Subsidiary of L&T Infrastructure Development Projects Limited #
Subsidiary *
Subsidiary of L&T Infrastructure Development Projects Limited #
Subsidiary of L&T Infrastructure Development Projects Limited #
Wholly owned subsidiary of L&T Capital Holdings Limited
Subsidiary *
Wholly owned subsidiary
Subsidiary *
Subsidiary of L&T Urban Infrastructure Limited #
Subsidiary of L&T Infocity Limited #
Wholly owned subsidiary of Hyderabad International Trade
Expositions Limited
148
(cid:129)
(cid:129)
(cid:129)
Notes forming part of the Accounts (contd.)
Sr. no. Name of the related party
Relationship
17
18
19
20
21
22
23
24
25
26
27
28
29
30
Larsen & Toubro (East Asia) SDN. BHD.
(formerly known as L&T-ECC Construction (M) SDN. BHD.)
Bhilai Power Supply Company Limited
Larsen & Toubro (Oman) LLC
Raykal Aluminium Company Private Limited
Cyber Park Development & Construction Limited
L&T-Sargent & Lundy Limited
Larsen & Toubro Qatar LLC
L&T Overseas Projects Nigeria Limited
Chennai Vision Developers Limited
Larsen & Toubro Electromech LLC
L&T Infocity Lanka Private Limited
Larsen & Toubro (Wuxi) Electric Company Limited
International Seaports Pte. Limited
International Seaports (India) Private Limited
31
L&T Panipat Elevated Corridor Limited
32
33
L&T Tech Park Limited
L&T Krishnagiri Thopur Toll Road Limited
34
L&T Western Andhra Tollways Limited
35
L&T Vadodara Bharuch Tollway Limited
36
L&T Interstate Road Corridor Limited
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
Spectrum Infotech Private Limited
L&T Urban Infrastructure Limited
Larsen & Toubro Infotech Canada Limited
(formerly known as Larsen & Toubro Information
Technology Canada Limited)
L&T Infrastructure Finance Company Limited
L&T Power Limited
(formerly known as L&T Power Projects Limited)
International Seaport Dredging Limited
L&T Modular Fabrication Yard LLC, Oman
Larsen & Toubro (Saudi Arabia) LLC
Larsen & Toubro Readymix Concrete Industries LLC
L&T Infrastructure Development Projects (Lanka)
Private Limited
L&T Electricals Saudi Arabia Company Limited LLC
Larsen & Toubro Kuwait Construction
General Contracting Company WLL
Larsen & Toubro (Qingdao) Rubber
Machinery Company Limited
Larsen & Toubro (Jiangsu) Valve Company Limited
L&T-MHI Boilers Private Limited
L&T Uttaranchal Hydropower Limited
L&T Bangalore Airport Hotel Limited
L&T-MHI Turbine Generators Private Limited
Subsidiary of Larsen & Toubro International FZE ##
Subsidiary *
Subsidiary of Larsen & Toubro International FZE #
Subsidiary *
Subsidiary of L&T Infrastructure Development Projects Limited #
Subsidiary *
Subsidiary of Larsen & Toubro International FZE ##
Subsidiary of Larsen & Toubro International FZE #
Wholly owned subsidiary of L&T Realty Private Limited
Subsidiary of Larsen & Toubro International FZE #
Subsidiary of L&T Infocity Limited #
Wholly owned subsidiary of Larsen & Toubro International FZE
Wholly owned subsidiary
Wholly owned subsidiary of L&T Infrastructure Development
Projects Limited
Wholly owned subsidiary of L&T Infrastructure Development
Projects Limited
Subsidiary of L&T Infrastructure Development Projects Limited #
Wholly owned subsidiary of L&T Infrastructure Development
Projects Limited
Wholly owned subsidiary of L&T Infrastructure Development
Projects Limited
Wholly owned subsidiary of L&T Infrastructure Development
Projects Limited
Wholly owned subsidiary of L&T Infrastructure Development
Projects Limited
Wholly owned subsidiary
Subsidiary of L&T Infrastructure Development Projects Limited #
Wholly owned subsidiary of Larsen & Toubro Infotech Limited
Wholly owned subsidiary of L&T Capital Holdings Limited
Wholly owned subsidiary
Subsidiary **
Subsidiary of Larsen & Toubro International FZE #
Subsidiary of Larsen & Toubro International FZE #
Subsidiary of Larsen & Toubro International FZE ##
Subsidiary of L&T Infrastructure Development Projects Limited #
Subsidiary of Larsen & Toubro International FZE #
Subsidiary of Larsen & Toubro International FZE ##
Subsidiary of Larsen & Toubro International FZE #
Subsidiary of Larsen & Toubro International FZE #
Subsidiary of L&T Power Limited #
Wholly owned subsidiary of L&T Power Development Limited
Subsidiary of L&T Urban Infrastructure Limited #
Subsidiary of L&T Power Limited #
149
Notes forming part of the Accounts (contd.)
Sr. no. Name of the related party
Relationship
L&T-Demag Plastics Machinery Limited
L&T Vision Ventures Limited
L&T Phoenix Info Parks Private Limited
L&T South City Projects Limited
55
56
57
58 GDA Technologies Inc.
59
60 GDA Technologies Limited
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76 Offshore International FZC
77 Qingdao Larsen & Toubro Trading Company Limited
CSJ Infrastructure Private Limited
L&T Hitech City Limited
L&T-Valdel Engineering Limited
L&T Arun Excello IT SEZ Private Limited
L&T Power Development Limited
L&T Shipbuilding Limited
L&T Infra & Property Development Private Limited
L&T Realty Private Limited
L&T Concrete Private Limited
L&T Strategic Management Limited
L&T General Insurance Company Limited
L&T Gulf Private Limited
L&T Transco Private Limited
Hi-Tech Rock Products & Aggregates Limited
L&T Arun Excello Commercial Projects Private Limited
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
Larsen & Toubro ATCO Saudia LLC
L&T Realty FZE
L&T Seawoods Private Limited
L&T Chennai-Tada Tollway Limited
L&T Siruseri Property Developers Limited
L&T Port Sutrapada Limited
Sutrapada SEZ Developers Limited
Sutrapada Shipyard Limited
L&T Electrical & Automation FZE
Larsen & Toubro Heavy Engineering LLC
TAMCO Switchgear (Malaysia) SDN. BHD.
TAMCO Shanghai Switchgear Company Limited
TAMCO Electrical Industries Australia Pty Limited
PT TAMCO Indonesia
L&T Capital Holdings Limited
L&T Natural Resources Limited
L&T Ahmedabad-Maliya Tollway Private Limited
L&T Halol-Shamlaji Tollway Private Limited
L&T Rajkot-Vadinar Tollway Private Limited
L&T Engserve Private Limited
Subsidiary of L&T Urban Infrastructure Limited #
Subsidiary of L&T Urban Infrastructure Limited #
Subsidiary of L&T Urban Infrastructure Limited #
Wholly owned subsidiary of Larsen & Toubro Infotech Limited
Wholly owned subsidiary (w.e.f. March 31, 2009)
Wholly owned subsidiary of GDA Technologies Inc.
Subsidiary of L&T Urban Infrastructure Limited #
Subsidiary of L&T Infocity Limited #
Subsidiary *
Subsidiary of L&T Urban Infrastructure Limited #
Wholly owned subsidiary
Wholly owned subsidiary
Wholly owned subsidiary
Wholly owned subsidiary
Wholly owned subsidiary
Wholly owned subsidiary
Wholly owned subsidiary of L&T Finance Limited
Subsidiary *
Wholly owned subsidiary
Wholly owned subsidiary
Subsidiary of L&T Urban Infrastructure Limited #
Subsidiary of Larsen & Toubro International FZE #
Wholly owned subsidiary of Larsen & Toubro (Qingdao)
Rubber Machinery Company Limited
Subsidiary of Larsen & Toubro International FZE ##
Wholly owned subsidiary of L&T Realty Private Limited
Wholly owned subsidiary
Wholly owned subsidiary of L&T Transco Private Limited
Wholly owned subsidiary of L&T South City Projects Limited
Wholly owned subsidiary of L&T Transco Private Limited
Wholly owned subsidiary of L&T Transco Private Limited
Wholly owned subsidiary of L&T Transco Private Limited
Wholly owned subsidiary of Larsen & Toubro International FZE
Subsidiary of Larsen & Toubro International FZE #
Wholly owned subsidiary of Larsen & Toubro International FZE
Wholly owned subsidiary of Larsen & Toubro International FZE
Wholly owned subsidiary of Larsen & Toubro International FZE
Wholly owned subsidiary of Larsen & Toubro International FZE
Subsidiary *
Wholly owned subsidiary
Wholly owned subsidiary
Wholly owned subsidiary
Wholly owned subsidiary
Wholly owned subsidiary
The Company holds more than one-half in nominal value of the equity share capital
The Company controls the composition of the Board of Directors
The Company, together with its subsidiaries, holds more than one-half in nominal value of the equity share capital
*
**
#
## The Company, together with its subsidiaries controls the composition of the Board of Directors
150
Notes forming part of the Accounts (contd.)
ii.
Names of the related parties with whom transactions were carried out during the year and description of relationship:
Subsidiary companies:
1
3
5
7
9
11
13
15
17
19
21
23
25
27
29
31
33
35
37
39
41
43
45
47
Cyber Park Development & Construction Limited
Larsen & Toubro (Wuxi) Electric Company Limited
L&T Capital Company Limited
L&T Finance Limited
L&T Infrastructure Development Projects Limited
L&T Krishnagiri Thopur Toll Road Limited
L&T Panipat Elevated Corridor Limited
L&T Tech Park Limited
L&T Urban Infrastructure Limited
L&T Western Andhra Tollways Limited
Larsen & Toubro (Oman) LLC
Larsen & Toubro Infotech Canada Limited
2
4
6
8
10
12
14
16
18
20
22
24
Larsen & Toubro (East Asia) SDN. BHD.
India Infrastructure Developers Limited
L&T-Sargent & Lundy Limited
L&T Engserve Private Limited
L&T Infocity Limited
L&T Interstate Road Corridor Limited
L&T Arun Excello Commercial Projects Private Limited
L&T Chennai-Tada Tollway Limited
L&T Vadodara Bharuch Tollway Limited
L&T Western India Tollbridge Limited
Larsen & Toubro Infotech GmbH
Larsen & Toubro International FZE
Larsen & Toubro Infotech Limited
26 Raykal Aluminum Company Private Limited
Narmada Infrastructure Construction Enterprise Limited
28 Tractor Engineers Limited
Larsen & Toubro Saudi Arabia LLC
L&T Modular Fabrication Yard LLC, Oman
L&T Electrical Saudi Arabia Company Limited, LLC
L&T Uttaranchal Hydropower Limited
30
32
34
36
L&T Southcity Projects Limited
Larsen & Toubro (Quingdao) Rubber Machinery Company Limited
L&T Infrastructure Finance Company Limited
L&T Power Limited (formerly known as L&T Power Project Limited)
International Seaport Dredging Limited
38 Bhilai Power Supply Company Limited
L&T Bangalore Airport Hotel Limited
Spectrum Infotech Private Limited
Larsen & Toubro Qatar LLC
Larsen & Toubro LLC
L&T-Valdel Engineering Limited
49 Offshore International FZC
40
42
44
L&T Phoenix Info Parks Private Limited
Larsen & Toubro Electromech LLC
L&T Seawoods Private Limited
46 Hyderabad International Trade Expositions Limited
48
50
L&T-MHI Boilers Private Limited
Larsen & Toubro Readymix Concrete Industries LLC
51
L&T Infrastructure Development Projects (Lanka) Private Limited 52
Larsen & Toubro (Jiangsu) Valve Company Limited
53 Qingdao Larsen & Toubro Trading Company Limited
53 CSJ Infrastructure Private Limited
55
57
59
61
63
65
67
69
71
73
75
77
79
81
83
L&T Hitech City Limited
L&T Vision Ventures Limited
L&T Rajkot-Vadinar Tollway Private Limited
Tamco Switchgear (Malaysia) SDN. BHD.
L&T Realty Private Limited
L&T Transco Private Limited
56
58
60
62
64
66
L&T Port Sutrapada Limited
L&T Gulf Private Limited
L&T Natural Resources Limited
L&T Power Development Limited
L&T Shipbuilding Limited
L&T Ahmedabad-Maliya Tollway Private Limited
L&T Halol-Shamlaji Tollway Private Limited
68 GDA Technologies Limited
Larsen & Toubro Kuwait Construction General Contracting Company WLL 70
Larsen & Toubro ATCO Saudia LLC
L&T Arun Excello IT SEZ Private Limited
L&T Electrical & Automation FZE
L&T Transportation Infrastructure Limited
L&T Overseas Projects Nigeria Limited
L&T Infra & Property Development Private Limited
72
74
76
78
80
L&T Heavy Engineering LLC
L&T-Demag Plastics Machinery Limited.
L&T PNG Tollway Private Limited
L&T-MHI Turbine Generators Private Limited
L&T Concrete Private Limited
L&T Strategic Management Limited
82 Hi-Tech Rock Products & Aggregates Limited
L&T Capital Holdings Limited
151
Notes forming part of the Accounts (contd.)
Associate companies:
1
3
5
7
9
Audco India Limited
L&T-Chiyoda Limited
L&T-Ramboll Consulting Engineers Limited
Voith Paper Technology (India) Limited
2
4
6
8
EWAC Alloys Limited
L&T-Komatsu Limited
L&T-Case Equipment Private Limited
Salzer Cables Limited
International Seaport (Haldia) Private Limited
10 Second Vivekananda Bridge Tollway Co. Limited
11
L&T Arun Excello Realty Private Limited
12
JSK Electricals Private Limited
Joint ventures (other than associates):
1
3
5
7
9
11
13
International Metro Civil Contractors Joint Venture
The Dhamra Port Company Limited
Metro Tunneling Group
Larsen & Toubro Limited-Shapoorji Pallonji & Company Limited
Joint Venture (Les Palles Exhibition Centre)
2
4
6
8
Bauer-L&T Diaphragm Wall Joint Venture
L&T-Eastern Joint Venture
L&T-Hochtief Seabird Joint Venture
Larsen & Toubro Limited-Shapoorji Pallonji & Company Limited
Joint Venture (Eben Cybercity)
Desbuild-L&T Joint Venture
L&T-AM Tapovan Joint Venture
L&T Bombay Developers Private Limited
10 HCC-L&T Purulia Joint Venture
12
L&T-Shanghai Urban Corporation Group Joint Venture
Key management personnel & their relatives:
1
3
5
7
Mr. A. M. Naik (Chairman & Managing director)
Mr. Y. M. Deosthalee (whole-time director)
Mrs. Leena Y. Deosthalee (wife)
Mr. R. N. Mukhija (whole-time director)
Mrs. Sushma Mukhija (wife)
Ms. Debika Ajmani (daughter)
2
4
6
Mr. J. P. Nayak (whole-time director)
Mrs. Neeta J. Nayak (wife)
Mr. Nitin Nayak (son)
Mr. K. Venkataramanan (whole-time director)
Mrs.Jyothi Venkataramanan (wife)
Mr. K. V. Rangaswami (whole-time director)
Mr. V. K. Magapu (whole-time director)
8
Mr. M. V. Kotwal (whole-time director)
iii. Disclosure of related party transactions:
Sr.
no. Nature of transaction/relationship/major parties
1
Purchase of goods & services (including commission paid)
Subsidiaries, including:
L&T Finance Limited
L&T Modular Fabrication Yard LLC
Tractor Engineers Limited
L&T-Valdel Engineering Limited
2008-2009
2007-2008
Amount
Amounts for
major parties
Amount Amounts for
major parties
Rs.crore
428.14
193.88
60.07
68.70
–
43.79
69.56
–
35.48
–
821.41
138.73
Associates & joint ventures, including:
934.96
1061.06
Audco India Limited
EWAC Alloys Limited
627.65
126.69
TOTAL
1363.10
1254.94
152
Notes forming part of the Accounts (contd.)
Sr.
no. Nature of transaction/relationship/major parties
2
Sale of goods/power/contract revenue & services
2008-2009
2007-2008
Amount
Amounts for
major parties
Amount Amounts for
major parties
Rs.crore
Subsidiaries, including:
2179.45
1349.59
Larsen & Toubro Infotech Limited
L&T Interstate Road Corridor Limited
L&T Krishnagiri Thopur Toll Road Private Limited
L&T Panipat Elevated Corridor Private Limited
L&T Vadodara Bharuch Tollway Limited
–
286.67
249.98
–
509.60
Associates & joint ventures, including:
523.54
69.04
Audco India Limited
L&T Arun Excello Realty Private Limited
L&T-Komatsu Limited
Second Vivekananda Bridge Tollway Company Private Limited
The Dhamra Port Company Limited
TOTAL
3
Purchase/lease of fixed assets
Subsidiaries, including:
India Infrastructure Developers Limited
L&T Finance Limited
Associates & joint ventures, including:
L&T- Case Equipment Private Limited
L&T-Komatsu Limited
EWAC Alloys Limited
TOTAL
4
Sale of fixed assets
Subsidiaries, including:
L&T Shipbuilding Limited
L&T Heavy Engineering LLC
TOTAL
5
Subscription to equity and preference shares
(including application money paid and investment in joint ventures)
Subsidiaries, including:
L&T Finance Limited
L&T Infrastructure Finance Company Limited
Larsen & Toubro International FZE
L&T Capital Holding Limited
Associates & joint ventures, including:
L&T-Shanghai Urban Corporation Group Joint Venture
L&T-AM Tapovan Joint Venture
L&T-Eastern Joint Venture
TOTAL
6
Purchase of investments
Subsidiary:
L&T Finance Limited
TOTAL
–
–
–
–
457.66
–
187.15
2.37
1.19
2.67
1418.63
1.11
20.42
2702.99
215.05
6.23
221.28
21.53
0.25
0.25
0.21
0.04
–
–
1758.99
985.01
52.10
–
–
533.04
1078.59
13.57
19.17
9.71
47.94
1811.09
1032.95
4.50
4.50
4.50
–
–
152.32
154.53
178.17
225.48
204.30
12.45
25.28
11.83
16.05
–
1.08
–
11.13
6.86
2.43
–
–
250.00
257.00
336.39
–
–
45.25
–
–
153
Notes forming part of the Accounts (contd.)
Sr.
no. Nature of transaction/relationship/major parties
7
Sale of investments
Subsidiary:
L&T Capital Holding Limited
TOTAL
8
Receiving of services from related parties
Subsidiaries, including:
Larsen & Toubro Infotech Limited
L&T-Sargent and Lundy Limited
L&T-Valdel Engineering Limited
Associates & joint ventures including:
L&T-Komatsu Limited
L&T-Chiyoda Limited
L&T-Ramboll Consulting Engineers Limited
TOTAL
9
Rent paid, including lease rentals under leasing/hire purchase
arrangements including loss sharing on equipment finance
Subsidiaries, including:
L&T Finance Limited
Associates & joint ventures, including:
EWAC Alloys Limited
L&T-Komatsu Limited
Key management personnel
Relatives of key management personnel
TOTAL
10
Charges for deputation of employees to related parties
Subsidiaries, including:
L&T-MHI Boilers Private Limited
Larsen & Toubro Infotech Limited
Offshore International FZC
L&T Infrastructure Development Projects Limited
L&T-Valdel Enginnering Limited
Associates & joint ventures, including:
EWAC Alloys Limited
L&T-Case Equipment Private Limited
Audco India Limited
L&T-Komatsu Limited
L&T-Chiyoda Limited
L&T-Ramboll Consulting Engineers Limited
The Dhamra Port Company Limited
2008-2009
2007-2008
Amount
Amounts for
major parties
Amount Amounts for
major parties
Rs.crore
1051.54
1051.54
1051.54
–
–
17.51
14.57
0.13
14.70
17.62
0.87
0.13
0.11
18.73
21.27
1.31
8.81
26.32
24.98
1.07
0.11
0.14
26.30
59.09
26.50
10.35
3.46
2.47
–
7.30
1.38
23.31
0.35
0.72
6.29
–
6.04
–
13.08
2.73
5.27
8.56
3.37
4.46
–
–
–
10.99
–
–
0.13
–
–
17.35
0.33
0.53
–
4.32
4.82
2.26
2.28
–
–
–
0.33
0.10
0.11
0.13
TOTAL
85.59
22.58
154
Notes forming part of the Accounts (contd.)
Sr.
no. Nature of transaction/relationship/major parties
11
Dividend received
Subsidiaries, including:
HPL Cogeneration Limited
Larsen & Toubro Infotech Limited
Associates & joint ventures, including:
L&T-Komatsu Limited
EWAC Alloys Limited
Audco India Limited
Voith Paper Technology (India) Limited
TOTAL
12
Commission received, including those under agency arrangements
Subsidiaries, including:
Larsen & Toubro Infotech Limited
L&T Finance Limited
Tractor Engineers Limited
L&T-Demag Plastics Machinery Limited
Associates & joint ventures, including:
L&T-Komatsu Limited
TOTAL
13
Rent received, overheads recovered and miscellaneous income
Subsidiaries, including:
Larsen & Toubro Infotech Limited
Larsen & Toubro (Oman) LLC
Associates & joint ventures, including:
L&T-Case Equipment Private Limited
Audco India Limited
L&T-Chiyoda Limited
L&T-Komatsu Limited
Metro Tunneling Group
TOTAL
14
Interest received
Subsidiaries, including:
Bhilai Power Supply Company Limited
L&T Seawoods Private Limited
Associate:
L&T-Case Equipment Private Limited
Key management personnel
TOTAL
15
Interest paid
Subsidiaries, including:
L&T Finance Limited
Associate:
Audco India Limited
TOTAL
2008-2009
2007-2008
Amount
Amounts for
major parties
Amount Amounts for
major parties
Rs.crore
15.80
56.24
72.04
5.88
151.47
157.35
111.52
33.69
145.21
55.59
1.01
0.06
56.66
9.83
7.77
17.60
–
15.80
28.80
12.44
9.00
6.00
–
–
–
5.88
149.57
55.21
48.04
5.60
7.49
3.27
2.74
7.45
–
35.93
1.01
8.68
7.77
46.91
11.50
58.41
0.84
207.05
207.89
99.91
23.52
123.43
10.09
–
0.03
10.12
6.62
2.35
8.97
28.45
15.64
3.60
1.45
3.60
2.85
0.27
0.23
0.33
–
198.52
42.99
–
4.54
3.63
–
–
–
2.38
–
–
6.15
2.35
155
Notes forming part of the Accounts (contd.)
Sr.
no. Nature of transaction/relationship/major parties
16
Payment of salaries/perquisites
Key management personnel:
2008-2009
2007-2008
Amount
Amounts for
major parties
Amount Amounts for
major parties
Rs.crore
56.46
38.02
A. M. Naik
J. P. Nayak
Y. M. Deosthalee
K. Venkataramanan
R. N. Mukhija
K. V. Rangaswami
V. K. Magapu
M. V. Kotwal
12.55
6.39
7.16
7.11
7.07
5.21
5.22
5.75
8.39
4.31
4.83
4.79
4.74
3.54
3.54
3.88
TOTAL
56.46
38.02
"Major parties" denote entities who account for 10% or more of the aggregate for that category of transaction during respective period.
iv.
Amount due to/from related parties
Sr.
no. Nature of transaction/relationship/major parties
1
Accounts receivable
Subsidiaries, including:
L&T Electrical Saudi Arabia Company Limited, LLC
Larsen & Toubro Infotech Limited
L&T Uttaranchal Hydropower Limited
L&T Interstate Road Corridor Limited
L&T Vadodara Bharuch Tollway Limited
Associates & joint ventures, including:
110.13
L&T Arun Excello Realty Private Limited
Second Vivekanand Bridge Tollway Company Private Limited
The Dhamra Port Company Limited
TOTAL
2
Accounts payable (including acceptance & interest accrued)
Subsidiaries, including:
Larsen & Toubro Infotech Limited
L&T Finance Limited
Tractor Engineers Limited
Tamco Switchgear (Malaysia) SDN. BHD.
Associates & joint ventures, including:
Audco India Limited
L&T-Hochtief Seabird Joint Venture
600.56
213.15
369.08
As at 31-3-2009
Amount
Amounts for
major parties
As at 31-3-2008
Amount Amounts for
major parties
Rs.crore
490.43
370.69
51.28
63.26
55.00
–
83.35
17.62
–
83.43
55.44
33.16
–
29.17
267.77
62.86
–
68.64
–
74.65
61.47
15.12
27.71
–
22.41
54.87
11.09
–
254.61
–
44.77
415.46
107.55
298.78
TOTAL
582.23
406.33
156
Notes forming part of the Accounts (contd.)
Sr.
no. Nature of transaction/relationship/major parties
3
Loans & advances recoverable
Subsidiaries, including:
Offshore International FZC
L&T Capital Company Limited
L&T Finance Limited
L&T Seawoods Private Limited
Associates & joint ventures, including:
L&T-Case Equipment Private Limited
L&T-Demag Plastics Machinery Limited
L&T-Chiyoda Limited
L&T-AM Tapovan Joint Venture
Key management personnel
Relatives of key management personnel
TOTAL
4
Advances against equity contribution
Subsidiaries, including:
L&T Shipbuilding Limited
Larsen & Toubro International FZE
L&T Power Development Limited
L&T Seawoods Private Limited
TOTAL
5
Unsecured loans (including lease finance)
Subsidiaries, including:
India Infrastructure Developers Limited
L&T Finance Limited
TOTAL
As at 31-3-2009
Amount
Amounts for
major parties
As at 31-3-2008
Amount Amounts for
major parties
Rs.crore
1704.93
258.50
–
770.81
–
591.60
–
–
–
71.26
248.50
–
–
250.00
–
146.19
43.69
0.79
0.06
303.04
66.35
66.35
9.02
9.02
117.76
0.66
0.10
1823.45
623.59
623.59
150.59
150.59
6
Advances received in the capacity of supplier of goods/services
classified as "advances from customers" in the Balance Sheet
Subsidiaries, including:
118.29
180.32
L&T Interstate Road Corridor Limited
L&T Krishnagiri Thopur Toll Road Private Limited
L&T-MHI Turbine Generators Private Limited
L&T Vadodara Bharuch Tollway Limited
L&T Chennai-Tada Tollway Limited
L&T Southcity Projects Limited
Associates & joint ventures, including:
Second Vivekananda Bridge Tollway Company Private Limited
L&T Arun Excello Realty Private Limited
The Dhamra Port Company Limited
–
–
25.41
–
34.21
28.97
–
8.03
15.43
23.46
8.89
TOTAL
141.75
189.21
30.11
75.72
48.38
–
12.67
12.05
5.01
4.67
–
46.19
20.00
–
8.50
–
26.83
18.92
–
56.50
–
18.24
1.56
7.33
–
157
Notes forming part of the Accounts (contd.)
Sr.
no. Nature of transaction/relationship/major parties
7
Due to whole-time directors
Key management personnel:
As at 31-3-2009
Amount
Amounts for
major parties
As at 31-3-2008
Amount Amounts for
major parties
Rs.crore
35.47
21.96
A. M. Naik
J. P. Nayak
Y. M. Deosthalee
K. Venkataramanan
R. N. Mukhija
K. V. Rangaswami
V. K. Magapu
M. V. Kotwal
8.45
4.22
4.22
4.22
4.22
3.38
3.38
3.38
5.23
2.62
2.62
2.61
2.61
2.09
2.09
2.09
TOTAL
35.47
21.96
"Major parties" denote entities who account for 10% or more of the aggregate for that category of transaction during respective period.
v.
Notes to related party transactions:
a)
b)
c)
The Company has a sole selling agreement with L&T-Komatsu Limited (LTK), an associate company, valid for the period of 5
years from October 16, 2006 in line with Government of India (GOI) approval letter dated May 28, 2007. The appointment shall
be in effect as long as the joint venture agreement between the parent Company and M/s Komatsu Asia Pacific Pte. Ltd.,
Singapore (which is a subsidiary of Komatsu Ltd., Japan) remains in force, subject to approval of GOI, under Section 294 AA of
the Companies Act, 1956. As per the terms of the agreement, the Company is the exclusive agent of L&T-Komatsu Limited to
market LTK machines and provide product support. Pursuant to the aforesaid agreement, LTK is required to pay commission to
the Company at specified rates on the sales effected by the Company.
The Company has renewed the selling agency agreement from October 1, 2003 with EWAC Alloys Limited (EWAC), an associate
company. The agreement shall remain valid until either party gives 12 months' prior written notice to the other for termination. As
per the terms of the agreement, the Company is the selling agent authorised to purchase and resell EWAC products in accordance
with the prices and other conditions stipulated in the agreement.
The Company has a selling agency agreement with L&T-Demag Plastics Machinery Limited (LTDPML), a wholly owned subsidiary.
As per the terms of the agreement, the Company is a selling and servicing agent of LTDPML. Pursuant to the aforesaid agreement,
LTDPML is required to pay commission to the Company at specified rates on sales effected by the Company.
Note: The financial impact of the agreements mentioned at (a) to (c) above has been included in/disclosed vide note no.18(iii) supra.
19. Leases:
Where the Company is a lessee:
a)
Finance leases:
i.
[a] Assets acquired on finance lease mainly comprise plant & machinery, vehicles and personal computers. The leases have a
primary period, which is fixed and non-cancellable. In the case of vehicles, the Company has an option to renew the lease
for a secondary period. The agreements provide for revision of lease rentals in the event of changes in (a) taxes, if any,
leviable on the lease rentals (b) rates of depreciation under the Income Tax Act, 1961 and (c) change in the lessor's cost of
borrowings. There are no exceptional/restrictive covenants in the lease agreements.
158
Notes forming part of the Accounts (contd.)
[b] The minimum lease rentals as at March 31, 2009 and the present value as at March 31, 2009 of minimum lease payments
in respect of assets acquired under finance leases are as follows:
Particulars
Rs.crore
Minimum lease
payments
Present value of
minimum lease payments
As at
31-3-2009
As at
31-3-2008
As at
31-3-2009
As at
31-3-2008
1. Payable not later than 1 year
2. Payable later than 1 year and not later than 5 years
3. Payable later than 5 years
Total
Less: Future finance charges
Present value of minimum lease payments
42.89
170.65
–
213.54
67.28
146.26
0.50
0.28
–
0.78
0.08
0.70
20.90
125.36
–
146.26
0.43
0.27
–
0.70
ii.
Contingent rent recognised/(adjusted) in the Profit and Loss Account in respect of finance leases: Rs.nil (previous year: Rs.nil)
b) Operating leases:
i.
The Company has taken various residential/commercial premises and plant and machinery under cancellable operating leases.
These lease agreements are normally renewed on expiry.
ii.
(a) The Company has taken certain assets like cars, technology assets, etc. on non-cancellable operating leases, the future
minimum lease payments in respect of which, as at March 31, 2009 are as follows:
Minimum lease payments
1. Payable not later than 1 year
2. Payable later than 1 year and not later than 5 years
3. Payable later than 5 years
Total
Rs.crore
12.02
9.03
–
21.05
(b) The lease agreements provide for an option to the Company to renew the lease period at the end of the non-cancellable
period. There are no exceptional/restrictive covenants in the lease agreements.
iii.
Lease rental expense in respect of operating leases: Rs.41.50 crore (previous year: Rs.40.91 crore)
iv. Contingent rent recognised in the Profit and Loss Account: Rs.0.11 crore (previous year: Rs.0.14 crore)
20. Provision for current tax includes:
i.
ii.
Provision for wealth tax Rs.3.37 crore [including Rs.0.98 crore being provision for wealth tax in respect of earlier years] (previous
year: Rs.1.23 crore)
Rs.53.84 crore being provision for income tax in respect of earlier years (previous year: provision for income tax of earlier years written
back Rs.25.33 crore)
iii. Rs.2.07 crore in respect of income tax payable outside India (previous year: Rs.nil)
iv. Provision for tax on fringe benefits includes credit for excess provision of Rs.0.20 crore pertaining to earlier years, reversed during the
year. (previous year: provision includes Rs.0.79 crore pertaining to earlier years)
159
Notes forming part of the Accounts (contd.)
21. Major components of deferred tax liabilities and deferred tax assets:
Particulars
Deferred tax
liabilities/(assets)
Charge/(credit) to
Profit and Loss Account
Charge/(credit) to
reserves
Deferred tax
liabilities/(assets)
As at 31-3-2008
ordinary
activity
extraordinary
activity
securities
premium account
hedging
reserve
As at 31.3.2009
Rs.crore
Deferred tax liabilities:
Difference between book and
tax depreciation
Gain on derivative transactions to be
offered for tax purposes in the year of
transfer to Profit and Loss Account
Disputed statutory liabilities paid and
claimed as deduction for tax purposes
but not debited to Profit and Loss Account
Total
Deferred tax (assets):
Provision for doubtful debts and advances
debited to Profit and Loss Account
Loss on derivative transactions to be
claimed for tax purposes in the year of
transfer to Profit and Loss Account
Unpaid statutory liabilities/provision for
compensated absences debited to
Profit and Loss Account
Other items giving rise to timing differences
Total
Net deferred tax liability/(assets)
Previous year
220.21
64.49
2.69
–
–
24.12
244.33
2.62
67.11
(100.01)
(45.84)
–
–
(48.78)
(34.17)
(182.96)
61.37
40.19
(19.34)
8.51
(56.67)
10.44
19.95
–
–
2.69
–
–
–
–
–
2.69
–
–
–
–
–
–
–
–
–
–
–
1.23
–
287.39
121.03
121.03
–
121.03
26.74
435.16
–
(145.85)
(147.06)
(147.06)
–
–
(68.12)
(25.66)
(147.06)
(386.69)
(26.03)
–
48.47
61.37
22. Basic and diluted earnings per share [EPS] computed in accordance with Accounting Standard (AS) 20 “Earnings per Share”.
Particulars
Before
extraordinary items
After
extraordinary items
2008-2009
2007-2008
2008-2009
2007-2008
Basic
Profit after tax as per the accounts (Rs.crore)
Weighted average number of shares outstanding
Basic EPS (Rupees)
Diluted
Profit after tax as per the accounts (Rs.crore)
Add: Interest/exchange difference (gain)/loss on bonds
convertible into equity shares (net of tax) (Rs.crore)
A
B
A/B
A
B
Adjusted profit for diluted earnings per share (Rs.crore)
C=A+B
Weighted average number of shares outstanding
Add: Weighted average number of potential equity shares
that could arise on conversion of FCCBs
Add: Weighted average number of potential equity shares
on account of employee stock options
D
E
F
2709.20
58,51,18,186
2173.42
2173.42
57,50,52,204 58,51,18,186 57,50,52,204
3481.66
46.30
37.80
59.50
37.80
2709.20
2173.42
3481.66
2173.42
–
2709.20
(21.85)
2151.57
–
3481.66
(21.85)
2151.57
58,51,18,186
57,50,52,204 58,51,18,186 57,50,52,204
–
24,59,448
–
24,59,448
79,89,615
1,39,06,732
79,89,615
1,39,06,732
Weighted average number of shares outstanding for Diluted EPS G=D+E+F
59,31,07,801
59,14,18,384 59,31,07,801 59,14,18,384
Diluted EPS (Rupees)
C/G
45.68
36.38
58.70
36.38
160
Notes forming part of the Accounts (contd.)
23. Disclosures required by Accounting Standard (AS) 29 "Provisions, Contingent Liabilities and Contingent Assets":
a) Movement in provisions:
Particulars
Product
warranties
Excise
duty
Sales
tax
Rs.crore
Class of Provisions
Litigation
Contractual Others
Total
obligations
related rectification cost-
construction
contracts
Balance as at 1-4-2008
Additional provision during the year
Provision for extraordinary item
Provision reversed during the year
Balance as at 31-3-2009
(5 = 1 + 2 + 3 - 4)
18.09
6.43
–
8.69
4.06
–
–
3.96
21.78
20.65
–
1.12
15.83
0.10
41.31
2.11
–
–
2.11
–
62.40
128.43
2.70 111.14
10.31 165.82
– 186.28* 186.28
27.18
–
11.30
190.83 187.99 436.06
Sr.
no.
1
2
3
4
5
* Refer note no.10
b) Nature of provisions:
i.
Product warranties: The Company gives warranties on certain products and services, undertaking to repair or replace the items
that fail to perform satisfactorily during the warranty period. Provision made as at March 31, 2009 represents the amount of the
expected cost of meeting such obligations of rectification/replacement. The timing of the outflows is expected to be within a
period of two years from the date of Balance Sheet.
ii.
Provision for excise duty represents the differential duty liability that is expected to materialise in respect of matters in appeal.
iii. Provision for sales tax represents mainly the differential sales tax liability on account of non-collection of declaration forms for the
period prior to 5 years.
iv. Provision for litigation related obligations represents liabilities that are expected to materialise in respect of matters in appeal.
v.
Contractual rectification cost represents the estimated cost the Company is likely to incur during defect liability period as per the
contract obligations in respect of completed construction contracts accounted under AS 7 (Revised) “Construction Contracts”.
c) Disclosure in respect of contingent liabilities is given as part of Schedule J to the Balance Sheet.
24. a)
The expenditure on research and development activities, as certified by the management, is Rs.80.19 crore (including capital expenditure
of Rs.5.01 crore) [previous year: Rs.67.25 crore, including capital expenditure of Rs.6.61 crore].
b)
An amount of Rs.197.46 crore (net loss) (previous year: Rs.280.89 crore [net loss]) has been accounted under respective revenue
heads in the Profit and Loss Account towards exchange differences arising on foreign currency transactions and forward contracts
covered under Accounting Standard (AS) 11 “The Effects of Changes in Foreign Exchange Rates”.
25.
In line with the Company's risk management policy, the various financial risks mainly relating to changes in the exchange rates, interest
rates and commodity prices are hedged by using a combination of forward contracts, swaps and other derivative contracts, besides the
natural hedges.
a)
The particulars of derivative contracts entered into for hedging purposes outstanding as at March 31, 2009 are as under:
Category of derivative instruments
For hedging foreign currency risks
a)
Forward contracts for receivables including firm commitments and
highly probable forecasted transactions
Forward contracts for payables including firm commitments and
highly probable forecasted transactions
b)
c) Currency swaps
d) Option contracts
For hedging interest rate risks
Interest rate swaps
For hedging commodity price risks
Commodity futures
i
ii
iii
Rs.crore
Amount of exposures hedged
As at
31-3-2009
As at
31-3-2008
4549.23
1999.09
6800.95
4946.36
108.25
1886.87
3658.49
3595.17
–
150.00
12.98
–
161
Notes forming part of the Accounts (contd.)
b) Unhedged foreign currency exposures as at March 31, 2009 are as under:
Rs.crore
Unhedged foreign currency exposures
i
ii
Receivables, including firm commitments and highly probable forecasted transactions
Payables, including firm commitments and highly probable forecasted transactions
As at
31-3-2009
As at
31-3-2008
14047.29
7491.61
11000.89
6919.90
26. Estimated amount of contracts remaining to be executed on capital account (net of advances) Rs.764.98 crore (previous year:
Rs.608.16 crore).
27. Managerial remuneration
a) Managing and whole-time directors' remuneration:
Particulars
Salary
Perquisites
Commission
Contribution to provident/superannuation fund
Total
Rs.crore
2008-2009
2007-2008
5.94
3.87
35.47
11.18
56.46
5.67
2.93
21.96
7.46
38.02
Note: The above figures do not include contribution to gratuity fund, pension scheme and provision for compensated absences, since
the same is provided on an actuarial basis for the Company as a whole.
b) Managerial remuneration and computation of net profit under Section 349 of the Companies Act, 1956.
Profit before tax before extraordinary items as per Profit and Loss Account
Add: Managing and whole-time directors' remuneration and commission
Commission paid to non-executive directors
Directors' fees
Depreciation, obsolescence and amortisation charged to the Accounts
Less: Transfer from revaluation reserve
Provision for diminution in value of investments
Less: Provision no longer required for earlier years
Provision for doubtful debts and advances (net)
Less: Provisions written-back
307.30
1.31
8.12
7.75
226.99
72.50
Provision for foreseeable losses on construction contracts
Profit (net) on sale of fixed assets as per Section 349 of the Companies Act, 1956
(net of capital profits)
Less:Profit on sale of fixed assets as per Profit and Loss Account (net)
Depreciation and obsolescence as per Section 350 of the Companies Act, 1956
Net profit as per Section 198 of the Companies Act, 1956
Maximum permissible remuneration to whole-time directors under Section 198
of the Companies Act, 1956 @ 10% of the profits computed above
Restricted as per service agreements to
Maximum permissible managerial remuneration to non-executive directors under
Section 198 of the Companies Act, 1956 @ 1%
Restricted as per shareholders' approval to
56.46
0.90
0.22
305.99
0.37
154.49
55.81
(1.71)
4.78
305.99
Rs.crore
3940.41
572.53
4512.94
310.77
4202.17
420.22
56.46
42.02
0.90
162
Notes forming part of the Accounts (contd.)
c) Miscellaneous expenses include provision of Rs.0.90 crore (net) [previous year: Rs.0.90 crore] towards commission payable to non-executive
directors of the Company, in terms of the special resolution passed at the annual general meeting held on August 26, 2005.
28. Auditors' remuneration (excluding service tax) and expenses charged to the accounts:
Particulars
Particulars
Particulars
Audit fees
Certification work
Tax audit fees
Expenses reimbursed
29. Value of imports (on C.I.F. basis):
Raw materials
Components and spare parts
Spare parts for sale
Capital goods
30. Expenditure in foreign currency:
On overseas contracts
Royalty and technical know-how fees
Interest
Professional/consultation fees
Other matters
31. Dividends remitted in foreign currency:
Dividend for the year ended March 31, 2008 to:
Particulars
Rs.crore
2008-2009
2007-2008
0.68
0.89
0.16
0.16
0.50
0.88
0.18
0.07
Rs.crore
2008-2009
2007-2008
1208.80
2145.65
398.13
617.23
624.75
1430.39
253.52
198.47
Rs.crore
2008-2009
2007-2008
2155.49
1545.01
2.36
100.09
113.10
3.28
56.75
82.04
1142.08
336.72
Rs.crore
2008-2009
2007-2008
i. 9 non-resident shareholders on 7,850 shares held by them (previous year: 7,850 shares) -
0.01
–
on 2-9-2008
ii. Custodian of global depositary receipts on 1,09,85,759 shares (previous year: 94,68,501 shares) -
16.48
3.44
on 2-9-2008
32. Earnings in foreign exchange:
Export of goods [including Rs.1592.09 crore on FOB basis (previous year: Rs.1432.49 crore)]
Particulars
Construction and project related activities
Export of services
Commission
Interest and dividend received
Other receipts
Rs.crore
2008-2009
2007-2008
1651.32
5196.41
452.61
38.14
2.98
6.77
1446.72
3611.31
577.99
2.91
17.66
–
163
Notes forming part of the Accounts (contd.)
33. The Company has amounts due to suppliers under The Micro, Small and Medium Enterprises Development Act, 2006, [MSMED Act] as at
March 31, 2009. The disclosure pursuant to the said Act is as under:
Particulars
Principal amount due to suppliers under MSMED Act, 2006
Interest accrued, due to suppliers under MSMED Act on the above amount. and unpaid
Payment made to suppliers (other than interest) beyond the appointed day during the year
Interest paid to suppliers under MSMED Act (other than Section 16)
Interest paid to suppliers under MSMED Act (Section 16)
Interest due and payable towards suppliers under MSMED Act for payments already made
Interest accrued and remaining unpaid at the end of the year to suppliers under MSMED Act
Rs.crore
2008-2009
2007-2008
9.64
0.12
22.09
–
0.13
0.13
0.25
3.55
0.01
9.43
–
0.06
0.06
0.07
Note: The information has been given in respect of such vendors to the extent they could be identified as "Micro and Small" enterprises on
the basis of information available with the Company.
34. The Company has given, inter alia, the following undertakings in respect of its investments:
a)
Jointly with L&T Infrastructure Development Projects Limited [a subsidiary of the Company], to the term lenders of its subsidiary
companies L&T Transportation Infrastructure Limited (LTTIL):
i.
ii.
not to reduce their joint shareholding in LTTIL below 51% until the financial assistance received from the term lenders is repaid
in full by LTTIL and
to jointly meet the shortfall in the working capital requirements of LTTIL until the financial assistance received from the term
lenders is repaid in full by LTTIL.
b)
c)
d)
e)
f)
In terms of Company's concession agreement with Government of India and Government of Gujarat, not to change the control over
L&T Western India Tollbridge Limited [a subsidiary of L&T Infrastructure Development Projects Limited] during the period of the
agreement.
To the debenture holders of L&T Infrastructure Development Projects Limited [a subsidiary of the Company] and to the lenders of its
subsidiaries L&T Panipat Elevated Corridor Private Limited & L&T Krishnagiri Thopur Toll Road Limited, not to dilute Company's
shareholding below 51%.
To the lender of L&T Offshore International FZC (a subsidiary of the Company), not to pledge or reduce it's shareholding in L&T
International FZE (the holding company of L&T Offshore International FZC) below 100% of the issued & allotted share capital.
Jointly with L&T-MHI Turbine Generators Private Limited (a subsidiary of L&T Power Limited, which is a wholly owned subsidiary of
the Company) and Mitsubishi Heavy Industries Limited (JV partners in L&T-MHI Turbine Generators Private Limited), to Andhra
Pradesh Power Development Company Limited (APPDCL) to render unconditional and irrevocable financial support for the successful
execution of APPDCL 2x800 MW Power Project - Steam Turbine Generator Package Tender, near Krishnapatnam, Nellore district,
Andhra Pradesh.
Not to sell or otherwise transfer, deal with or agree to acquire, sell or otherwise transfer or deal with, in any manner the shares of
Satyam Computer Services Limited (SCSL), held by the Company or its affiliates, till October 21, 2009 or a date approved by the
appropriate authorities which ever is earlier.
35. During the year, the Company transferred at book value the equity investments held by it in the following companies to its wholly-owned
subsidiary L&T Capital Holdings Limited,
Name of the company
India Infrastructure Developers Limited
L&T Finance Limited
L&T Infrastructure Finance Company Limited
NAC Infrastructure Equipment Limited
Sr.
no.
1
2
3
4
164
No. of
equity shares
5,60,60,000
18,66,91,500
50,00,00,000
45,00,000
Detail of investments
Face value
per share
Amount
invested
Rupees
Rs.crore
10
10
10
10
56.06
490.98
500.00
4.50
Notes forming part of the Accounts (contd.)
36. There are no amounts due and outstanding to be credited to Investor Education & Protection Fund as at March 31, 2009.
37. According to the Company, Construction is a service activity and therefore, the same is covered under para 3(ii)(c) of Part II of Schedule VI
to the Companies Act, 1956.
38. Details of sales, raw materials and components consumed, capacities & production, inventories and purchase of trading goods:
a)
Sales:
Class of goods
2008-2009
2007-2008
Unit
Quantity
Value
Quantity
Value
Tonnes
8,187
Petrol dispensing and metering pumps
Nos.
1,979
Earthmoving and agricultural machinery and spares
Welding alloys & accessories
Industrial machinery
Nuclear purpose equipment, de-aerators, ultra high
pressure vessels including multiwall vessels, high
pressure heat exchangers and high pressure heaters
in aggregate
Plant & equipment and modules for nuclear power
projects, heavy water projects, nuclear and space
research and allied projects, including items for
Chemical, Oil & Gas, etc. industries
Powder metallurgy and industrial products
Industrial electronic control panels
Valves and accessories
Chemical plant & machinery, including pharmaceutical,
dyestuff, distillery, brewery and solvent extraction plants,
evaporator and crystalliser plants and pollution control
equipment in aggregate
Switchgear, all types
Electro surgical unit and accessories
Ship auxiliaries and components of mechanised
sailing vessels
Complete cement making machinery, including rotary
kilns and fluxo packers in aggregate
Transmission line tower
Steel structural fabrication
Rubber processing machinery and accessories
Ultrasound equipment and accessories
Patient monitoring system and accessories
Electricity meters
Ready mix concrete
Defence equipment all types
Others
TOTAL @
Rs.crore
417.77
194.36
318.36
Rs.crore
165.45
329.86
283.61
16,097
Tonnes
13,278
Tonnes
110
30.48
292
20.51
Tonnes
36,388
3583.79
29,423
2972.09
100.83
137.81
781.97
2358.85
1071.91
4.38
37.29
117.68
172.40
871.66
8,771
1178.87
965.74
4.49
6,649
106.14
Tonnes
60
8.70
168
14.57
Nos.
Tonnes
Tonnes
Nos.
Nos.
Parts for
3 Plants
22,807
13,086
–
240
100.80
121.63
140.75
Parts for
2 Plants
42,297
7,054
–
6,93,771
298.77
195.74
75.25
18.03
299.36
11.12
46.84
111.93
235
297.05
20.05
53.70
144.09
Cu.m.
20,26,416
605.92
30,72,870
1067.62
54.60
2274.44
12813.89
55.47
1541.30
10970.14
165
@ includes Rs.6933.20 crore of construction & project related activity (previous year: Rs.4837.29 crore)
Notes forming part of the Accounts (contd.)
b) Raw materials and components consumed:
i)
Class of goods:
Particulars
Steel
Non-ferrous metals
Bakelite
Cement machinery components
Nuclear equipment components, including items for
Oil & Gas industries, etc. in aggregate
Chemical plant components
Switchgear components
Electronic devices, test & measuring instruments
and industrial electronic control panel components
Metering & protection systems and medical
equipment and components
Industrial machinery components
Power plant & machinery components
Others
TOTAL
ii)
Classification of goods:
2008-2009
2007-2008
Unit
Quantity
Value
Quantity
Value
Rs.crore
Rs.crore
Tonnes
Metres
46,976
16,39,248
Sq. mtrs.
14,86,147
Nos./Sets
31,21,882
Tonnes
Metres
Sq. mtrs.
Nos.
Tonnes.
2,487
8,18,158
2,147
43,851
376
207.31
209.14
376.14
706.69
86.29
8.92
7.80
13.01
4.26
63.30
1626.55
1176.84
782.55
29.57
170.14
47.89
514.67
587.93
6619.00
73,164
279.84
8,99,498
5,23,345
9,33,089
3,649
7,44,906
1,327
1,03,841
404
79.99
352.48
478.45
112.86
9.62
5.61
9.10
5.05
112.55
1275.90
671.20
767.76
137.21
203.36
43.68
316.87
983.56
5845.09
2008-2009
2007-2008
Particulars
% to total
consumption
Value % to total
Rs.crore consumption
Value
Rs.crore
2343.24
3501.85
40
60
100
5845.09
Imported (including through canalising agencies)
Indigenous
TOTAL
44
56
100
2935.28
3683.72
6619.00
166
Notes forming part of the Accounts (contd.)
c) Capacities & production:
Class of goods
Scrapper, bulldozer, ripper and loader attachments
Road rollers, hot mix plants and other road construction and
bridge construction machinery
Dairy machinery and equipment - various items in aggregate
Chemical plant and machinery, including pharmaceutical, dyestuff,
distillery, brewery and solvent extraction plants, evaporator and
crystalliser plants and pollution control equipment in aggregate
Equipment for food processing industry
Complete cement making machinery, including rotary kilns and
fluxo packers in aggregate
Sugarcane and beet diffusion, beet preparation and beet pulp
dehydration plants
Nuclear purpose equipment, de-aerators, ultra high pressure
vessels, vessels including multiwall vessels, high pressure
heat exchangersand high pressure heaters in aggregate
Plant and equipment and modules for nuclear power projects,
heavy water projects, nuclear and space research and allied
projects, including items for chemical, oil and gas, etc. industries
Complete high speed bottling plants
Pulp and paper making plants
Suspended particles drying plants
Unit
Nos
Nos
Nos
Tonnes
Tonnes
Nos
Nos
Tonnes
Tonnes
Nos
Tonnes
Nos
Licensed
capacity
250
(250)
150
(150)
35,584
(35,584)
6,567
(6,567)
65
(65)
2
(2)
2
(2)
5,000
(5,000)
10,000
(10,000)
6
(6)
2,000
(2,000)
6
(6)
Containers for liquefied gases and chemicals
Nos
Not applicable *
Steel plant valves
Nos
Ship auxiliaries and components of mechanised sailing vessels
Tonnes
Rubber processing machinery
Switchgear, all types
Miscellaneous electrical items
Petrol dispensing and metering pumps
Nos
Nos
Nos
Nos
(Not applicable)*
40
(40)
1,000
(1,000)
109
(109)
26,78,500$
(26,78,500)$
10,49,100
(10,49,100)
4,800
(4,800)
Press tools, jigs, fixtures, dies for pressure castings, moulds
for plastic injection and bakelite
Rs.Lakh/Nos
Rs.220 lakh@
Rs.330 lakh
(Rs.220 lakh)@ (Rs.295 lakh)
Industrial machinery
Tonnes
12,000
(12,000)
12,000
(12,000)
Installed
capacity
Actual
production
250
(250)
150
(150)
35,584
(35,584)
6,567
(6,567)
65
(65)
–
(–)
–
(–)
–
(–)
7,507
(9,171)
–
(–)
2
Parts for 3 plants
(2) (Parts for 2 plants)
2
(2)
3,950
(3,950)
–
(–)
110
(292)
10,000
(10,000)
28,451 #
(33,800)#
6
(6)
800
(800)
6
(6)
1,000 tonnes
carrying capacity
(1,000 tonnes
carrying capacity)
40
(40)
1,000
(1,000)
109
(109)
31,74,750
(31,74,750)
10,39,100
(10,39,100)
4,800
(4,800)
–
(–)
–
(–)
–
(–)
–
(–)
–
(–)
60
(168)
244
(232)
58,98,474
(50,42,105)
–
(–)
1,882
(6,757)
510 nos
(370 nos)
13,278
(16,169)
167
Notes forming part of the Accounts (contd.)
c) Capacities & production (contd.)
Class of goods
Industrial electronic control panels
Electronic devices
Electro surgical unit and accessories
Ultrasound equipment and accessories
Patient monitoring system and accessories
Relays
Control & relay panels
Electricity meters
Transmission line tower
Steel structural fabrication
Steel re-rolling
Ready mix concrete
Defence equipment. all types
Parts for aircraft and other metal products
Parts and accessories for prime movers, boilers, steam
generating plants and nuclear reactor
Commercial ships
Unit
Nos
Nos
Nos
Nos
Nos
Nos
Nos
Nos
Tonnes
Metric Tonnes
Tonnes
Licensed
capacity
2,500
(2,500)
30,000
(30,000)
Not applicable *
(Not applicable) *
Not applicable *
(Not applicable) *
Not applicable *
(Not applicable) *
Not applicable *
(Not applicable) *
Not applicable *
(Not applicable) *
Not applicable *
(Not applicable) *
90,000
(51,000)
12,000
(12,000)
40,000
(40,000)
Installed
capacity
2,500
(2,500)
30,000
(30,000)
1,250
(1,250)
1,000
(1,000)
7,000
(7,000)
60,000
(60,000)
100
(100)
Actual
production
410
(638)
–
(9,248)
341
(452)
312
(519)
6,239
(6,603)
34,363
(55,222)
–
(–)
7,00,000
(7,00,000)
6,16,426
(5,83,540)
90,000
(51,000)
12,000
(12,000)
40,000
(40,000)
86,355
(62,804)
30,018
(45,852)
32,453
(31,506)
M3
Nos
No.
Nos
Nos
–
(53,58,400)
–
(53,58,400)
21,50,002
(34,65,306)
3,971
(3,971)
1,00,000
(–)
25,000
(–)
–
(–)
3,971
915 parts thereof
(3,971) (274 parts thereof)
1,00,000
(–)
25,000
(–)
2
(2)
–
(–)
–
(–)
–
(–)
Figures in brackets pertain to previous year.
*
Licensing not applicable. Installed capacity is based on one of the following:
1.
Entrepreneur's memoranda filed with Government of India, Ministry of Industry, New Delhi;
2. Registration with the Directorate General of Technical Development;
3.
4.
Approval obtained from the Government of India, Ministry of Industry, New Delhi;
Agreement with Government of India, Ministry of Petroleum & Natural Gas.
@ Excludes Rs.200 lakh in respect of memorandum no.1322/SIA/IMO/92 dated 27-3-1992 of which capacity of Rs.75 lakh has
been installed.
Excludes 6,96,250 nos. in respect of memoranda nos.924/SIA/IMO/91 and 922/SIA/IMO/91 dated 11-9-1991 of which capacity
of 4,96,250 nos. has been installed.
Includes production from external sources
$
#
168
Notes forming part of the Accounts (contd.)
d)
Inventories:
Class of goods
As at 31-3-2009
As at 31-3-2008
As at 31-3-2007
Unit Quantity
Value Quantity
Value Quantity
Value
Rs.crore
Rs.crore
Rs.crore
Electronic, medical and other instruments,
accessories and spares
Industrial machinery
Switchgear, all types
Complete cement making machinery, including rotary
kilns and fluxo packers in aggregate
–
Tonnes
–
253
–
1.08
132.66
–
253
–
3.52
130.54
–
221
Nos
–
– Parts for
2 Plants
0.47 Parts for
2 Plants
Patient monitoring systems and accessories
5.08
9.43
0.17
4.49
120.03
38.40
7.07
Tonnes
152
495.71
152
444.45
152
568.94
Chemical plant & machinery, including pharmaceutical,
dyestuff, distillery, brewery and solvent extraction plants,
evaporator and crystalliser plants and pollution control
equipment in aggregate
Industrial electronic control panels
Spares for earthmoving and agricultural machinery
Nuclear purpose equipment, deaerators, ultra high
pressure vessels including multiwall vessels, high
pressure heat exchangers and high pressure
heaters in aggregate
Ultrasound equipment and accessories
Powder metallurgy and industrial products
Petrol dispensing and metering pumps
Nos
184
Valves and accessories
Earthmoving machinery, including bulldozers, dumpers,
scrappers, loaders, vibratory compactors and drag lines
(excluding walking drag lines)
Welding alloys and accessories
Electronic test & measuring instruments
Plant and equipment and modules for nuclear power
projects, heavy water projects, nuclear and space
research and allied projects including items for Chemical,
Oil & Gas, etc. industries
Defence equipment, all types
Commercial Ships
Ship auxiliaries and components of mechanised
sailing vessels
Others
Total @
–
74.91
159.24
5.90
10.29
2.28
5.82
25.14
14.61
–
2843.83
283.18
399.99
62.16
700.68
5222.56
281
0.01
57.30
129.91
6.09
10.56
2.92
5.16
18.23
21.62
–
1813.85
665.93
191.17
39.70
227.07
3777.93
@ includes Rs.4880.02 crore shown as construction-related WIP in current year (previous year: Rs.3456.55 crore)
173
0.04
38.49
96.48
6.13
8.18
4.74
2.56
6.22
16.56
0.49
1386.27
–
–
–
530.82
2836.08
169
Notes forming part of the Accounts (contd.)
e)
Purchases of trading goods:
Class of goods
Earthmoving and agricultural machinery and spares
Welding alloys and accessories
Valves and accessories
Electronic, medical & other instruments, accessories and spares
Powder metallurgy and industrial products
Others
Total
Notes:
Rs.crore
2008-2009
2007-2008
325.50
120.53
603.26
469.95
68.54
90.91
240.51
127.77
764.03
284.13
71.48
138.18
1678.69
1626.10
(a) The installed capacities are as certified by managing/whole-time directors, on which the auditors have placed reliance.
(b)
In terms of note 3 to para 3 of Part II of Schedule VI, items like spare parts and accessories are given without quantities in respect
of sales, purchases and stocks.
(c) Quantitative figures for sales are after exclusion of inter-divisional transfers, capitalisation/captive consumption, samples, etc.
39. Miscellaneous expenses include donations aggregating to Rs.4.70 crore made during the year to political parties as follows: Akhil Bharatiya
Congress Committee: Rs.2.25 crore, Bharatiya Janata Party: Rs.2.00 crore and Shiv Sena Madhyavarti Karyalaya: Rs.0.45 crore.
40. Certain elements of operational income of business segments forming a part of segment results used to be hitherto categorised as a part
of 'other income' in the Profit and Loss Account. During the current year the same have been regrouped under 'other operational income' in
the Profit and Loss Account to reflect the proper classification.
41.
Interest income, has been shown separately as a part of 'other income' during current year.
42. Figures for the previous year have been regrouped/reclassified wherever necessary.
170
Notes forming part of the Accounts (contd.)
43. Balance Sheet abstract and Company’s general business profile
I. Registration details
Registration no.
Balance Sheet date
L 9 9 9 9 9 M H 1 9 4 6 P L C 0 0 4 7 6 8
3 1
Date
2 0 0 9
Year
0 3
Month
II. Capital raised during the year (Amount in Rs.thousands) @
Public issue
Bonus issue
N I L
5 8 5 1 8 4
State Code
1 1
Rights issue
Private placement
N I L
N I L
@ The Company also raised capital during the year by way of allotment of shares under Employee Stock Ownership Schemes amounting to Rs.1537 Thousands
III. Position of mobilisation and deployment of funds (amount in Rs.thousands)
Sources of funds
Total liabilities
1 9 4 5 0 8 7 6 0
Paid-up capital
1 1 7 1 3 7 6
* Including employees stock options outstanding Rs.2356655 thousands.
Secured loans
1 1 0 2 3 7 9 4
Deferred tax liabilities
4 3 5 1 6 2 6
Application of funds
Net fixed assets and net intangible assets
5 1 9 4 5 9 5 6
Net current assets
5 6 0 5 6 0 6 7
Misc. expenditure
2 6 2 2
IV. Performance of Company (Amount in Rs.Thousands)
Total assets
1 9 4 5 0 8 7 6 0
Reserves & surplus*
1 2 3 4 2 5 5 3 1
Unsecured loans
5 4 5 3 6 4 3 3
Investments
8 2 6 3 7 2 0 9
Deferred tax assets
3 8 6 6 9 0 6
Accumulated losses
N I L
Turnover (Including other income)
3 4 6 7 9 7 3 3 8
+ – Profit/loss before tax before extraordinary items @
+
3 9 4 0 4 0 7 6
Total expenditure
3 0 7 3 9 3 2 6 2
Profit/loss after tax @ $
3 4 8 1 6 5 4 9
+ –
+
@ Includes Company’s share in profit of integrated joint ventures Rs.106819 thousands (net of tax).
$ Includes extraordinary items Rs.7724613 thousands [net of tax] (see note no.10)
Basic earnings per share after extraordinary items in Rupees #
Dividend rate%
5 9 . 5 0
5 2 5
V. Generic names of three principal products/services of the Company (as per monetory terms)
# Basic earnings per share before extraordinary items - Rs.46.30
Item code no. (ITC code)
Product description
Construction and project related activity.
N A
Item code no. (ITC code)
8 4 7 9 8 9 . 0 2
Product description
Plant and equipment and modules for nuclear power projects, heavy water projects, nuclear and space
research and allied projects including items for chemical, oil and gas, etc. industries.
Item code no. (ITC code)
Product description
8 4 7 9 8 9 . 0 2
Chemical plant & machinery, including pharmaceutical, dyestuff, distillery, brewery and solvent extraction
plants, evaporator and crystalliser plants and pollution control equipment in aggregate.
As per our report attached
SHARP & TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No.15882
Mumbai, May 28, 2009
Signature to Schedules A to Q and Notes
A. M. NAIK
Chairman & Managing Director
Y. M. DEOSTHALEE
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
BHAGYAM RAMANI
A. K. JAIN
N. HARIHARAN
Company Secretary
Directors
Mumbai, May 28, 2009
171
Statement pursuant to Section 212 of the Companies Act, 1956, relating to
subsidiary companies
Name of the subsidiary company
L&T Finance
Limited
Larsen &
Toubro
Infotech
Limited
31-3-2009
Larsen &
Toubro
(Oman)
LLC
31-12-2008
India
Infrastructure
Developers
Limited
31-3-2009
L&T
Infocity
Limited
31-3-2009
Larsen & Larsen & Toubro
Infotech
Canada
Limited
31-3-2009
Toubro
International
FZE
31-12-2008
Financial year of the subsidiary company ended on
31-3-2009
Number of shares in the subsidiary company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
The extent of interest in subsidiary companies of
Larsen & Toubro Limited as at the above date
The net aggregate of profits, less losses, of the subsidiary company
so far as it concerns the members of Larsen & Toubro Limited:
NIL
NIL
3,00,00,000
NIL
NIL
NIL
NIL
NIL
NIL
NIL
1,616
NIL
NIL
NIL
99.99%
100.00%
65.00%
99.99%
53.17%
100.00%
100.00%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary company other
than for meeting current liabilities
Name of the subsidiary company
Financial year of the subsidiary company ended on
Number of shares in the subsidiary company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding company’s interest in subsidiary company
The net aggregate of profits, less losses, of the subsidiary company
so far as it concerns the members of Larsen & Toubro Limited:
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary company other
than for meeting current liabilities
172
NIL
30.55
98.82
234.92
NIL
NIL
NIL
NIL
NIL
15.80
143.91
246.33
450.68
NIL
NIL
NIL
NIL
NIL
NIL
3.26
36.91
48.79
NIL
NIL
NIL
NIL
NIL
Narmada
L&T L&T-Sargent &
Infrastructure Transportation Lundy Limited
Infrastructure
Construction
Limited
Enterprise Limited
31-3-2009
31-3-2009
31-3-2009
NIL
NIL
3.32
(13.09)
NIL
NIL
NIL
NIL
NIL
Larsen &
Toubro
(East Asia)
SDN.BHD
31-12-2008
NIL
5.28
25.04
81.37
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(302.48)
(81.07)
76
NIL
NIL
NIL
NIL
NIL
NIL
2.03
0.39
NIL
NIL
NIL
NIL
NIL
L&T Western
India
Tollbridge
L&T Larsen & Toubro
Infrastructure (Wuxi) Electric
Company
Development
Limited Projects Limited
Limited
31-12-2008
31-3-2009
31-3-2009
1,26,48,507
NIL
79.65%
1,08,64,000
NIL
79.65%
27,52,129
NIL
50.00%
NIL
NIL
30.00%
1,39,50,007
NIL
79.65%
19,30,31,352
NIL
79.65%
NIL
NIL
100.00%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
NIL
NIL
13.50
13.36
NIL
NIL
NIL
NIL
NIL
NIL
1.31
6.77
3.06
NIL
NIL
NIL
NIL
NIL
NIL
0.03
5.22
3.40
NIL
NIL
NIL
NIL
NIL
NIL
1.08
0.15
0.03
NIL
NIL
NIL
NIL
NIL
NIL
1.95
2.40
7.16
NIL
NIL
NIL
NIL
NIL
NIL
NIL
8.63
131.10
NIL
NIL
NIL
NIL
NIL
NIL
NIL
1.11
(2.38)
NIL
NIL
NIL
NIL
NIL
Statement pursuant to Section 212 of the Companies Act, 1956, relating to
subsidiary companies (contd.)
Name of the subsidiary company
Cyber Park
Development &
Construction
Limited
31-3-2009
L&T
Capital
Company
Limited
31-3-2009
Larsen &
Toubro
Infotech,
GmbH
31-3-2009
Hyderabad
International
Trade Expositions
Limited
31-3-2009
Tractor
Engineers
Limited
Larsen &
Toubro
Qatar LLC
Larsen &
Toubro
LLC
31-3-2009
31-12-2008
31-12-2008
Financial year of the subsidiary company ended on
Number of shares in the subsidiary company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding company’s interest in subsidiary company
The net aggregate of profits, less losses, of the subsidiary company
so far as it concerns the members of Larsen & Toubro Limited:
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary company other
than for meeting current liabilities
Name of the subsidiary company
Financial year of the subsidiary company ended on
Number of shares in the subsidiary company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding company’s interest in subsidiary company
The net aggregate of profits, less losses, of the subsidiary company
so far as it concerns the members of Larsen & Toubro Limited:
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary company other
than for meeting current liabilities
NIL
NIL
30.47%
2,20,00,000
NIL
100.00%
NIL
NIL
100.00%
NIL
NIL
30.90%
68,000
NIL
100.00%
NIL
NIL
49.00%
50,000
NIL
100.00%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
NIL
NIL
3.39
4.33
NIL
NIL
NIL
NIL
NIL
NIL
0.55
3.50
8.34
NIL
NIL
NIL
NIL
NIL
NIL
NIL
1.84
5.14
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(0.25)
(1.22)
NIL
NIL
NIL
NIL
NIL
NIL
2.38
(23.80)
24.17
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(0.43)
(10.38)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
0.62
0.48
NIL
NIL
NIL
NIL
NIL
International
Seaports
(India) Private
Limited
31-3-2009
International
Seaports
Pte.
Limited
31-12-2008
L&T Panipat
Elevated
Corridor
Limited
31-3-2009
L&T Tech
Park Limited
31-3-2009
L&T
Krishnagiri
Thopur Toll
Road Limited
31-3-2009
L&T Western
Andhra
Tollways
Limited
31-3-2009
L&T Vadodara
Bharuch
Tollway
Limited
31-3-2009
NIL
NIL
79.65%
18,15,000
NIL
100.00%
NIL
NIL
79.65%
NIL
NIL
30.47%
NIL
NIL
79.65%
NIL
NIL
79.65%
NIL
NIL
79.65%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
NIL
NIL
(0.01)
(0.74)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(2.45)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(24.73)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(0.58)
0.27
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(4.37)
(1.48)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
0.19
NIL
NIL
NIL
NIL
NIL
NIL
173
Statement pursuant to Section 212 of the Companies Act, 1956, relating to subsidiary
companies (contd.)
Name of the subsidiary company
L&T Interstate
Road
Corridor
Limited
31-3-2009
Spectrum
Infotech
Private
Limited
31-3-2009
L&T Infocity
Lanka
Private
Limited
31-3-2009
L&T Overseas
Projects
Nigeria
Limited
31-12-2008
L&T Infrastructure
Development
Projects Lanka
(Private) Limited
31-3-2009
L&T Infrastructure
Finance
Company
Limited
31-3-2009
Financial year of the subsidiary company ended on
Number of shares in the subsidiary company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding company’s interest in subsidiary company
The net aggregate of profits, less losses, of the subsidiary company
so far as it concerns the members of Larsen & Toubro Limited:
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary company other
than for meeting current liabilities
Name of the subsidiary company
L&T Urban
Infrastructure
Limited
31-3-2009
NIL
NIL
59.74%
NIL
NIL
79.65%
4,40,000
NIL
100.00%
NIL
NIL
27.65%
NIL
NIL
100.00%
NIL
NIL
75.67%
NIL
NIL
99.99%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
NIL
NIL
(0.10)
NIL
NIL
NIL
NIL
NIL
NIL
L&T
Power
Limited
NIL
NIL
1.68
0.93
NIL
NIL
NIL
NIL
NIL
NIL
NIL
3.59
(1.68)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
0.23
0.45
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(0.17)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
76.45
50.15
NIL
NIL
NIL
NIL
NIL
International
Seaport
Dredging
Limited
31-3-2009
L&T Modular
Fabrication
Yard LLC
31-12-2008
Toubro
Saudi
Larsen & Larsen & Toubro Larsen & Toubro L&T Electricals
Saudi Arabia
Readymix (Jiangsu) Valve
Company
Company
Concrete
Limited, LLC
Arabia LLC Industries LLC
Limited
31-3-2009
31-12-2008
31-12-2008
31-12-2008
Financial year of the subsidiary company ended on
31-3-2009
Number of shares in the subsidiary company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding company’s interest in subsidiary company
The net aggregate of profits, less losses, of the subsidiary company
so far as it concerns the members of Larsen & Toubro Limited:
5,13,01,000
NIL
100.00%
30,805
9,420
46.02%
NIL
NIL
65.00%
NIL
NIL
100.00%
NIL
NIL
49.00%
NIL
NIL
69.70%
NIL
NIL
75.00%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary company other
than for meeting current liabilities
174
NIL
NIL
NIL
NIL
(0.54)
(27.15)
NIL
NIL
NIL
NIL
NIL
NIL
7.43
NIL
NIL
NIL
NIL
NIL
NIL
NIL
0.45
(3.19)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(4.52)
(50.37)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
7.44
(3.68)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(2.93)
(3.15)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(0.29)
(0.14)
NIL
NIL
NIL
NIL
NIL
Statement pursuant to Section 212 of the Companies Act, 1956, relating to subsidiary
companies (contd.)
Name of the subsidiary Company
Larsen & Toubro
Kuwait Construction
General Contracting
Larsen &Toubro
(Qingdao) Rubber
Machinery
Company, WLL Company Limited
31-12-2008
31-12-2008
L&T-MHI
Boilers
Private
Limited
31-3-2009
L&T
Uttaranchal
Hydropower
Limited
31-3-2009
L&T
Bangalore
Airport
Hotel Limited
31-3-2009
L&T-Valdel
Engineering
Limited
31-3-2009
L&T
Vision
Ventures
Limited
31-3-2009
Financial year of the subsidiary company ended on
Number of shares in the subsidiary Company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding Company’s interest in subsidiary Company
The net aggregate of profits, less losses, of the subsidiary Company
so far as it concerns the members of Larsen & Toubro Limited:
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary Company other
than for meeting current liabilities
Name of the subsidiary Company
Financial year of the subsidiary company ended on
Number of shares in the subsidiary Company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding Company’s interest in subsidiary Company
The net aggregate of profits, less losses, of the subsidiary Company
so far as it concerns the members of Larsen & Toubro Limited:
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary Company other
than for meeting current liabilities
NIL
NIL
49.00%
NIL
NIL
95.00%
NIL
NIL
51.00%
NIL
NIL
100.00%
NIL
NIL
44.21%
12,44,500
NIL
95.00%
NIL
NIL
40.62%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
NIL
NIL
(1.22)
(0.32)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
0.23
(0.30)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(10.81)
(0.76)
(0.02)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
2.49
14.82
0.81
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(0.03)
NIL
NIL
NIL
NIL
NIL
NIL
L&T Phoenix
Info Parks
Private
Limited
31-3-2009
Larsen &
Toubro
Electromech
LLC
31-12-2008
GDA
Technologies
Inc.
GDA
Technologies
Limited
L&T Power
Development
Limited
31-3-2009
31-3-2009
31-3-2009
Toubro
ATCO
Larsen & L&T Arun Excello
Commercial
Projects
Saudi LLC Private Limited
31-3-2009
31-12-2008
NIL
NIL
30.47%
NIL
NIL
65.00%
NIL
NIL
100.00%
NIL
NIL
100.00%
8,60,00,000
NIL
100.00%
NIL
NIL
49.00%
NIL
NIL
30.47%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
NIL
NIL
(0.44)
(0.01)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
8.20
5.00
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(6.96)
(35.99)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
3.07
52.01
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(3.40)
(2.53)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(2.03)
(0.01)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
175
Statement pursuant to Section 212 of the Companies Act, 1956, relating to subsidiary
companies (contd.)
Name of the subsidiary Company
L&T
L&T-Gulf
Private
Limited
L&T Hitech
City Limited
HI-Tech Rock
Products &
Aggregates
L&T-MHI
Turbine
Generators
Limited Private Limited
31-3-2009
31-3-2009
L&T Arun
Excello IT
SEZ Private
Limited
31-3-2009
L&T Concrete
Shipbuilding Private Limited
Limited
31-3-2009
31-3-2009
Financial year of the subsidiary company ended on
31-3-2009
31-3-2009
Number of shares in the subsidiary Company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding Company’s interest in subsidiary Company
The net aggregate of profits, less losses, of the subsidiary Company
so far as it concerns the members of Larsen & Toubro Limited:
12,50,005
NIL
50.00%
NIL
NIL
39.34%
50,000
NIL
100.00%
NIL
NIL
51.00%
NIL
NIL
30.47%
50,000
NIL
100.00%
10,000
NIL
100.00%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary Company other
than for meeting current liabilities
Name of the subsidiary Company
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(0.02)
(0.18)
(0.10)
(2.28)
(0.10)
(2.18)
(0.002)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
L&T Transco
Private
Limited
L&T Realty
Private
Limited
L&T Strategic
Management
Limited
L&T Infra &
Qingdao
Property Larsen & Toubro
Development Trading Company
Limited
Private Limited
31-12-2008
31-3-2009
Chennai
Vision
Developers
Private Limited
31-3-2009
L&T
Engserve
Private
Limited
31-3-2009
Financial year of the subsidiary company ended on
31-3-2009
31-3-2009
31-3-2009
Number of shares in the subsidiary Company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding Company’s interest in subsidiary Company
The net aggregate of profits, less losses, of the subsidiary Company
so far as it concerns the members of Larsen & Toubro Limited:
10,000
NIL
100.00%
4,71,60,700
NIL
100.00%
50,000
NIL
100.00%
10,000
NIL
100.00%
NIL
NIL
95.00%
NIL
NIL
100.00%
10,000
NIL
100.00%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary Company other
than for meeting current liabilities
176
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(5.22)
(3.57)
(0.004)
(0.002)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
0.04
(0.05)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(0.004)
(0.004)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
Statement pursuant to Section 212 of the Companies Act, 1956, relating to subsidiary
companies (contd.)
Name of the subsidiary Company
L&T Siruseri
Andhra
Pradesh
Expositions
Private Limited
31-3-2009
Raykal
Aluminium
Company
Private Limited
31-3-2009
L&T South
City Projects
Limited
31-3-2009
L&T General
Insurance
Company
Limited
31-3-2009
L&T
Property Chennai -Tada
Tollway
Limited
31-3-2009
Developers
Limited
31-3-2009
L&T
Seawoods
Private
Limited
31-3-2009
Financial year of the subsidiary company ended on
Number of shares in the subsidiary Company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding Company’s interest in subsidiary Company
The net aggregate of profits, less losses, of the subsidiary Company
so far as it concerns the members of Larsen & Toubro Limited:
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary Company other
than for meeting current liabilities
Name of the subsidiary Company
NIL
NIL
30.90%
40,000
NIL
80.00%
NIL
NIL
30.47%
NIL
NIL
100.00%
NIL
NIL
30.47%
100
NIL
100.00%
10,000
NIL
100.00%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(0.0002)
(0.45)
(0.02)
(0.77)
(0.001)
(0.16)
(1.77)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
L&T
Realty FZE
Offshore
International
FZC
L&T Natural
Resources
Limited
L&T Capital
Holdings
Limited
L&T Electrical
& Automation
FZE
Larsen &
Toubro Heavy
Engineering
LLC
31-12-2008
TAMCO
Switchgear
(Malaysia)
SDN. BHD
31-12-2008
Financial year of the subsidiary company ended on
31-12-2008
31-12-2008
31-3-2009
31-3-2009
31-12-2008
Number of shares in the subsidiary Company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding Company’s interest in subsidiary Company
The net aggregate of profits, less losses, of the subsidiary Company
so far as it concerns the members of Larsen & Toubro Limited:
NIL
NIL
100.00%
NIL
NIL
60.00%
50,000
NIL
100.00%
20,49,795
NIL
99.99%
NIL
NIL
100.00%
NIL
NIL
70.00%
NIL
NIL
100.00%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
(i)
(ii)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary Company other
than for meeting current liabilities
NIL
NIL
0.04
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(4.98)
(1.76)
(0.02)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
3.44
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(2.67)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
7.49
NIL
NIL
NIL
NIL
NIL
NIL
177
Statement pursuant to Section 212 of the Companies Act, 1956, relating to subsidiary
companies (contd.)
Name of the subsidiary Company
Tamco Tamco Electrical
Industries
Australia
Pty Limted
31-12-2008
Shanghai
Switchgear
Co. Limted
31-12-2008
PT
TAMCO
Indonesia
31-12-2008
L&T-Demag
Plastics
Machinery
Limited
31-3-2009
L&T PNG
Tollway
Private
Limited
31-3-2009
Sutrapada
SEZ
Developers
Limited
31-3-2009
Sutrapada
Shipyard
Limited
31-3-2009
NIL
NIL
100.00%
NIL
NIL
100.00%
NIL
NIL
99.00%
1,60,00,00
NIL
100.00%
2,600
NIL
74.00%
NIL
NIL
100.00%
NIL
NIL
100.00%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Financial year of the subsidiary company ended on
Number of shares in the subsidiary Company held
by Larsen & Toubro Limited at the above date -
–
–
Equity shares
Preference shares
Holding Company’s interest in subsidiary Company
The net aggregate of profits, less losses, of the subsidiary Company
so far as it concerns the members of Larsen & Toubro Limited:
(i)
(b)
Dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since it
became subsidiary of Larsen & Toubro Limited
Not dealt with in the accounts of Larsen & Toubro Limited
amounted to:
(a)
for the subsidiary’s financial year ended
March 31, 2009 and December 31, 2008
for previous financial years of the subsidiary since
it became subsidiary of Larsen & Toubro Limited
(b)
(ii)
Changes in the interest of Larsen & Toubro Limited between the
end of the subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial
year and March 31, 2009
Fixed assets (net additions)
Investments
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary Company other
than for meeting current liabilities
Name of the subsidiary Company
NIL
NIL
10.42
NIL
NIL
NIL
NIL
NIL
NIL
Financial year of the subsidiary company ended on
Number of shares in the subsidiary company held by Larsen & Toubro Limited
at the above date -
–
–
Equity shares
Preference shares
Holding company’s interest in subsidiary company
The net aggregate of profits, less losses, of the subsidiary company so far as it
concerns the members of Larsen & Toubro Limited:
(i)
Dealt with in the accounts of Larsen & Toubro Limited amounted to:
(a)
(b)
for the subsidiary’s financial year ended 31.03.2009 and 31.12.2008
for previous financial years of the subsidiary since it became subsidiary
of Larsen & Toubro Limited
(ii)
Not dealt with in the accounts of Larsen & Toubro Limited amounted to:
(a)
(b)
for the subsidiary’s financial year ended March 31.03.2009 and 31.03.2008
for previous financial years of the subsidiary since it became
subsidiary of Larsen & Toubro Limited
Changes in the interest of Larsen & Toubro Limited between the end of the
subsidiary’s financial year and March 31, 2009
Number of shares acquired
Material changes between the end of the subsidiary’s financial year and 31.03.2009
(i)
(ii)
(iii) Moneys lent by the subsidiary
(iv) Moneys borrowed by the subsidiary company other than for meeting current liabilities
Fixed assets (net additions)
Investments
NIL
NIL
1.17
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(18.74)
NIL
NIL
NIL
NIL
NIL
NIL
L&T Port
Sutrapada
Limited
31-3-2009
CSJ
Infrastructure
Private
Limited
31-3-2009
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(0.05)
(0.002)
(0.002)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
L&T
Bhilai Power
Supply
L&T
Ahmedabad- Halol-Shamlaji Rajkot-Vadinar
Company Maliya Tollway Tollway Private Tollway Private
Limited
31-3-2009
Limited Private Limited
31-3-2009
Limited
31-3-2009
31-3-2009
L&T
NIL
NIL
100.00%
NIL
NIL
41.82%
49,950
NIL
99.90%
10,10,000
NIL
100.00%
10,10,000
NIL
100.00%
10,10,000
NIL
100.00%
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
NIL
NIL
NIL
NIL
(0.07)
(0.20)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
(0.05)
(0.06)
(0.05)
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
A. M. NAIK
Chairman & Managing Director
Y. M. DEOSTHALEE
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
BHAGYAM RAMANI
A. K. JAIN
Mumbai, May 28, 2009
N. HARIHARAN
Company Secretary
Directors
Mumbai, May 28,2009
178
Information on subsidiary companies
(for the financial year or as on, as the case may be)
Sr.
no.
1
2
3
4
5
6
7
8
9
10
11
12
Sr.
no.
1
2
3
4
5
6
7
8
9
10
11
12
Sr.
no.
1
2
3
4
5
6
7
8
9
10
11
12
Particulars
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
Particulars
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
Particulars
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
L&T Finance
Limited
Larsen &
Toubro
Infotech
Limited
Larsen &
Toubro
(Oman)
LLC
India
Infrastructure
Developers
Limited
L&T
Infocity
Limited
Larsen & Larsen & Toubro
Infotech
Canada
Limited
Toubro
International
FZE
31-3-2009
31-3-2009
211.69
633.77
4,693.09
5,538.55
5,538.55
7.01
830.28
145.36
46.53
98.83
–
–
15.84
553.78
638.22
1,207.84
1,207.84
222.91
1,975.36
289.43
24.61
264.82
–
–
31-12-2008
Omani Riyal
126.5200
4.57
176.37
941.54
1,122.48
1,122.48
–
1,490.76
64.54
7.75
56.79
–
–
Narmada
L&T L&T-Sargent &
Infrastructure Transportation Lundy Limited
Infrastructure
Construction
Limited
Enterprise Limited
31-3-2009
31-3-2009
31-3-2009
47.35
33.73
63.46
144.54
144.54
–
37.75
19.09
2.14
16.95
–
–
41.40
12.34
157.67
211.41
211.41
–
33.68
15.72
7.22
8.50
–
–
Cyber Park
Development &
Construction
Limited
31-3-2009
L&T
Capital
Company
Limited
31-3-2009
1.00
25.34
23.16
49.50
49.50
–
48.42
15.68
4.54
11.14
–
–
22.00
11.84
776.96
810.80
810.80
798.13
6.38
5.18
1.68
3.50
–
–
5.50
15.34
26.01
46.85
46.85
18.22
62.74
16.50
6.07
10.43
–
–
Larsen &
Toubro
Infotech,
GmbH
31-3-2009
Euro
67.4400
0.11
6.98
10.06
17.15
17.15
–
52.12
2.06
0.22
1.84
–
–
31-3-2009
31-3-2009
31-12-2008
31-3-2009
USD Canadian Dollar
40.5250
48.7100
56.06
(9.78)
0.04
46.32
46.32
44.35
1.63
3.32
–
3.32
–
–
Larsen &
Toubro
(East Asia)
SDN.BHD.
31-12-2008
Malaysian
Ringitt
14.1075
0.86
0.90
28.96
30.72
30.72
–
115.00
0.57
0.06
0.51
–
–
27.00
200.15
316.57
543.72
543.72
30.68
195.53
69.37
15.95
53.42
–
–
1,015.53
(257.87)
237.10
994.76
994.76
592.64
(103.39)
(302.48)
–
(302.48)
–
–
0.0004
2.36
6.75
9.11
9.11
–
25.04
3.04
1.01
2.03
–
–
L&T Western
India
Tollbridge
L&T Larsen & Toubro
Infrastructure (Wuxi) Electric
Company
Development
Limited
Limited Projects Limited
31-3-2009
31-3-2009
31-12-2008
Chinese Yuan
Renminbi
7.2929
13.95
12.00
0.68
26.63
26.63
–
11.31
3.36
0.35
3.01
–
–
298.37
811.31
254.79
1,364.47
1,364.47
1,112.11
38.40
12.03
1.20
10.83
–
–
24.61
(0.37)
8.46
32.70
32.70
–
30.20
1.11
–
1.11
–
–
Hyderabad
International
Trade Expositions
Limited
Tractor
Engineers
Limited
Larsen &
Toubro
Qatar LLC
Larsen &
Toubro
LLC
31-3-2009
31-3-2009
31-12-2008
Qatari Riyal
13.3825
31-12-2008
USD
48.7100
17.01
(4.77)
35.88
48.12
48.12
0.01
9.90
0.06
0.87
(0.81)
–
–
6.80
19.16
153.26
179.22
179.22
0.01
167.35
(23.92)
(0.12)
(23.80)
–
–
0.24
(16.65)
47.29
30.88
30.88
0.13
4.14
(0.88)
–
(0.88)
–
–
0.24
1.31
23.50
25.05
25.05
–
26.18
0.94
0.32
0.62
–
–
179
Information on subsidiary companies
(for the financial year or as on, as the case may be) (contd.)
International
L&T
Seaports
Krishnagiri
(India) Private
Thopur Toll
Limited
Road Limited
International
Seaports
Pte.
Limited
L&T Panipat
Elevated
Corridor
Limited
L&T Tech
Park Limited
Particulars
Sr.
no.
L&T Western
Andhra
Tollways
Limited
L&T Vadodara
Bharuch
Tollway
Limited
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
31-3-2009
15-11-2007
Singapore Dollar
29.0725
31-3-2009
31-3-2009
31-3-2009
31-3-2009
31-3-2009
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
Particulars
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
Particulars
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
2.50
(3.90)
1.43
0.03
0.03
–
–
(0.01)
–
(0.01)
–
–
7.85
(7.83)
–
0.02
0.02
–
–
–
–
–
–
–
84.30
(31.05)
691.84
745.09
745.09
–
25.76
(31.03)
0.02
(31.05)
–
–
28.50
4.51
87.65
120.66
120.66
–
17.14
0.04
1.93
(1.89)
–
–
78.75
(5.49)
815.06
888.32
888.32
–
9.41
(5.48)
0.01
(5.49)
–
–
56.50
43.09
280.63
380.22
380.22
–
1.53
(1.85)
–
(1.85)
–
–
43.50
0.24
1,308.59
1,352.33
1,352.33
–
0.35
0.29
0.05
0.24
–
–
L&T Interstate
Road
Corridor
Limited
31-3-2009
Spectrum
Infotech
Private
Limited
31-3-2009
L&T Urban
Infrastructure
Limited
31-3-2009
L&T Infocity
Lanka
Private
Limited
L&T Overseas L&T Infrastructure
Development
Projects
Nigeria Projects Lanka
Limited (Private) Limited
L&T Infrastructure
Finance
Company
Limited
31-3-2009
Sri Lankan
Rupees
0.4534
31-12-2008
Nigerian
Naira
0.3604
31-3-2009
Sri Lankan
Rupees
0.4534
54.12
(0.12)
660.43
714.43
714.43
–
0.09
0.03
0.15
(0.12)
–
–
0.44
4.47
6.88
11.79
11.79
–
8.68
2.57
0.89
1.68
–
–
488.85
11.45
164.68
664.98
664.98
466.68
13.50
7.31
1.29
6.02
–
–
8.07
2.66
18.95
29.68
29.68
–
5.01
1.11
0.29
0.82
–
–
0.33
(0.16)
0.02
0.19
0.19
–
0.01
(0.17)
–
(0.17)
–
–
57.23
1.74
32.62
91.59
91.59
–
–
–
–
–
–
–
L&T
Power
Limited
International
Seaport
Dredging
Limited
31-3-2009
31-3-2009
102.49
(0.54)
0.18
102.13
102.13
102.10
–
(0.54)
–
(0.54)
–
–
85.41
(48.30)
372.71
409.82
409.82
–
329.35
(58.71)
0.29
(59.00)
–
–
L&T Modular
Fabrication
Yard LLC
Larsen & Larsen & Toubro Larsen & Toubro L&T Electricals
Saudi Arabia
Readymix (Jiangsu) Valve
Company
Company
Concrete
Limited, LLC
Limited
Arabia LLC Industries LLC
Toubro
Saudi
31-12-2008
Omani Riyal
31-12-2008
Saudi Riyal
126.5200
12.9875
10.48
(2.76)
139.64
147.36
147.36
–
102.92
0.69
–
0.69
–
–
4.64
(172.14)
179.52
12.02
12.02
–
5.11
(4.52)
–
(4.52)
–
–
31-12-2008
31-12-2008
UAE Dirham Chinese Yuan
Renminbi
7.2929
13.2625
1.27
8.06
103.22
112.55
112.55
–
132.10
15.18
–
15.18
–
–
36.91
(0.65)
21.26
57.52
57.52
–
28.30
(4.20)
–
(4.20)
–
–
31-3-2009
Saudi Riyal
13.5225
22.29
1.48
59.92
83.69
83.69
–
33.44
(0.38)
–
(0.38)
–
–
31-3-2009
500.00
126.61
1,783.18
2,409.79
2,409.79
115.00
295.99
113.97
37.51
76.46
–
–
1
2
3
4
5
6
7
8
9
10
11
12
Sr.
no.
1
2
3
4
5
6
7
8
9
10
11
12
Sr.
no.
1
2
3
4
5
6
7
8
9
10
11
12
180
Information on subsidiary companies
(for the financial year or as on, as the case may be) (contd.)
Larsen & Toubro
L&T
Kuwait Construction
Bangalore
General Contracting
Airport
Hotel Limited
Larsen &Toubro
(Qingdao) Rubber
Machinery
Company, WLL Company Limited
L&T
Uttaranchal
Hydropower
Limited
L&T-MHI
Boilers
Private
Limited
Particulars
Sr.
no.
L&T-Valdel
Engineering
Limited
L&T
Vision
Ventures
Limited
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
Particulars
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
Particulars
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
1
2
3
4
5
6
7
8
9
10
11
12
Sr.
no.
1
2
3
4
5
6
7
8
9
10
11
12
Sr.
no.
1
2
3
4
5
6
7
8
9
10
11
12
31-12-2008
Kuwaiti
Dinar
176.9025
31-12-2008
Chinese Yuan
Renminbi
7.2929
31-3-2009
31-3-2009
31-3-2009
31-3-2009
31-3-2009
32.02
(0.15)
8.42
40.29
40.29
–
7.71
(2.49)
–
(2.49)
–
–
26.84
7.11
48.81
82.76
82.76
0.54
25.80
0.24
–
0.24
–
–
100.10
(21.20)
11.92
90.82
90.82
23.02
0.68
(21.12)
0.08
(21.20)
–
–
48.05
(0.76)
95.37
142.66
142.66
–
0.64
(0.68)
0.08
(0.76)
–
–
72.00
(0.04)
117.17
189.13
189.13
–
0.41
0.08
0.12
(0.04)
–
–
L&T Phoenix
Info Parks
Private
Limited
31-3-2009
Larsen &
Toubro
Electromech
LLC
31-12-2008
Omani Riyal
126.5200
63.02
(1.47)
195.96
257.51
257.51
–
19.52
2.70
4.13
(1.43)
–
–
3.56
22.29
173.92
199.77
199.77
–
327.87
24.85
2.75
22.10
–
–
GDA
Technologies
Inc.
GDA
Technologies
Limited
L&T Power
Development
Limited
31-3-2009
USD
50.7200
5.15
(32.14)
53.22
26.23
26.23
0.38
60.34
(6.96)
–
(6.96)
–
–
31-3-2009
31-3-2009
0.17
27.62
6.33
34.12
34.12
–
23.72
2.96
(0.12)
3.08
–
–
101.00
(5.93)
15.05
110.12
110.12
79.12
–
(3.40)
–
(3.40)
–
–
1.31
23.16
23.03
47.50
47.50
19.75
72.46
19.97
4.36
15.61
–
–
9.60
(0.08)
0.98
10.50
10.50
–
–
(0.07)
–
(0.07)
–
–
Larsen & L&T Arun Excello
Commercial
Projects
Saudi LLC Private Limited
Toubro
ATCO
31-3-2009
31-12-2008
Saudi Riyal
12.9875
1.08
(4.45)
7.84
4.47
4.47
–
0.97
(3.09)
–
(3.09)
–
–
0.96
37.10
37.71
75.77
75.77
–
–
(0.02)
0.02
(0.04)
–
–
L&T-Gulf
Private
Limited
L&T Hitech
City Limited
HI-Tech Rock
Products &
Aggregates
L&T-MHI
Turbine
Generators
Limited Private Limited
L&T Arun
Excello IT
SEZ Private
Limited
L&T Concrete
Shipbuilding Private Limited
L&T
Limited
31-3-2009
31-3-2009
31-3-2009
31-3-2009
31-3-2009
31-3-2009
31-3-2009
2.50
(0.04)
3.45
5.91
5.91
–
6.69
0.05
0.09
(0.04)
–
–
19.23
(0.45)
34.39
53.17
53.17
–
0.01
(0.44)
0.01
(0.45)
–
–
0.05
(0.10)
0.10
0.05
0.05
–
–
(0.10)
–
(0.10)
–
–
100.10
(4.46)
126.88
222.52
222.52
18.46
6.76
(4.43)
0.03
(4.46)
–
–
18.37
83.78
135.28
237.43
237.43
–
1.03
(0.30)
0.01
(0.31)
–
–
248.55
(2.18)
19.34
265.71
265.71
–
–
(2.11)
0.07
(2.18)
–
–
0.01
–
–
0.01
0.01
–
–
–
–
–
–
–
181
Information on subsidiary companies
(for the financial year or as on, as the case may be) (contd.)
L&T Transco
Qingdao
Private
Property Larsen & Toubro
Development Trading Company
Limited
Limited
Private Limited
L&T Strategic
Management
Limited
L&T Realty
Private
Limited
L&T Infra &
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
Particulars
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
Particulars
31-3-2009
31-3-2009
31-3-2009
31-3-2009
50.31
(5.22)
1.51
46.60
46.60
45.40
–
(5.21)
0.01
(5.22)
–
–
47.16
(3.57)
3.96
47.55
47.55
0.17
–
(3.49)
0.08
(3.57)
–
–
0.05
–
–
0.05
0.05
–
–
–
–
–
–
–
0.01
–
–
0.01
0.01
–
–
–
–
–
–
–
31-12-2008
Chinese Yuan
Renminbi
7.2929
0.54
0.16
4.97
5.67
5.67
–
7.79
0.04
–
0.04
–
–
Chennai
Vision
Developers
Private Limited
31-3-2009
L&T
Engserve
Private
Limited
31-3-2009
0.01
–
–
0.01
0.01
–
–
–
–
–
–
–
0.01
–
0.07
0.08
0.08
–
–
–
–
–
–
–
Andhra
Pradesh
Expositions
Private Limited
Raykal
Aluminium
Company
Private Limited
L&T South
City Projects
Limited
L&T General
Insurance
Company
Limited
L&T Siruseri
Property
Developers
Limited
L&T
Chennai-Tada
Tollway
Limited
31-3-2009
31-3-2009
31-3-2009
31-3-2009
31-3-2009
31-3-2009
L&T
Seawoods
Private
Limited
31-3-2009
0.01
–
0.02
0.03
0.03
–
–
–
–
–
–
–
1.27
(0.56)
0.22
0.93
0.93
–
–
(0.56)
–
(0.56)
–
–
56.48
75.77
126.74
258.99
258.99
0.05
1.45
(0.06)
0.01
(0.07)
–
–
0.05
(0.77)
0.77
0.05
0.05
–
–
(0.77)
–
(0.77)
–
–
0.05
–
–
0.05
0.05
–
–
–
–
–
–
–
42.00
(0.16)
0.16
42.00
42.00
–
0.09
(0.15)
0.01
(0.16)
–
–
250.01
(1.77)
1,680.20
1,928.44
1,928.44
–
–
(1.74)
0.03
(1.77)
–
–
L&T
Realty FZE
Offshore
International
FZC
L&T Natural
Resources
Limited
L&T Capital
Holdings
Limited
L&T Electrical
& Automation
FZE
Larsen &
Toubro Heavy
Engineering
LLC
TAMCO
Switchgear
(Malaysia)
SDN. BHD
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
31-12-2008
UAE Dirham
13.2625
31-12-2008
USD
48.7100
31-3-2009
31-3-2009
31-12-2008
UAE Dirham
13.2625
31-12-2008
31-12-2008
Omani Riyal Malaysian Ringitt
14.1075
126.5200
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
16.26
3.88
0.01
20.15
20.15
–
–
0.04
–
0.04
–
–
0.27
(9.48)
448.35
439.14
439.14
–
–
(8.31)
–
(8.31)
–
–
0.05
(1.76)
2.90
1.19
1.19
–
–
(1.76)
–
(1.76)
–
–
1,078.59
(0.02)
0.01
1,078.58
1,078.58
1,076.54
0.03
(0.02)
–
(0.02)
–
–
1.09
3.90
22.61
27.60
27.60
–
27.79
3.44
–
3.44
–
–
39.71
(1.04)
47.97
86.64
86.64
–
–
(3.81)
–
(3.81)
–
–
119.18
38.84
296.32
454.34
454.34
–
458.62
26.09
10.00
16.09
–
–
1
2
3
4
5
6
7
8
9
10
11
12
Sr.
no.
1
2
3
4
5
6
7
8
9
10
11
12
Sr.
no.
1
2
3
4
5
6
7
8
9
10
11
12
182
Information on subsidiary companies
(for the financial year or as on, as the case may be) (contd.)
L&T PNG
Tollway
Private
Limited
Tamco Tamco Electrical
Industries
Australia
Pty Limted
L&T - Demag
Plastics
Machinery
Limited
Shanghai
Switchgear
Co. Limted
PT
TAMCO
Indonesia
Particulars
Sr.
no.
Sutrapada
SEZ
Developers
Limited
Sutrapada
Shipyard
Limited
1
2
3
4
5
6
7
8
9
10
11
12
Sr.
no.
1
2
3
4
5
6
7
8
9
10
11
12
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application
money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
Particulars
31-12-2008
Chinese Yuan
Renminbi
7.2929
31-12-2008
Australian
Dollar
33.7250
31-12-2008
Indonesian
Rupiah
0.0045
26.97
19.11
51.84
97.92
97.92
–
59.43
(6.57)
–
(6.57)
–
–
45.20
(53.03)
28.26
20.43
20.43
–
20.12
(5.49)
–
(5.49)
–
–
0.22
(34.72)
46.48
11.98
11.98
–
24.78
(10.66)
–
(10.66)
–
–
L&T Port
Sutrapada
Limited
CSJ
Infrastructure
Private
Limited
31-3-2009
31-3-2009
31-3-2009
31-3-2009
16.00
(6.20)
72.07
81.87
81.87
–
86.51
(6.39)
0.08
(6.47)
–
–
0.01
(0.06)
0.37
0.32
0.32
–
–
(0.06)
–
(0.06)
–
–
0.05
–
–
0.05
0.05
–
–
–
–
–
–
–
0.05
–
–
0.05
0.05
–
–
–
–
–
–
–
Bhilai Power
Supply
L&T
Ahmedabad -
L&T Rajkot -
Vadinar
Company Maliya Tollway Tollway Private Tollway Private
Limited
Limited Private Limited
L&T Halol -
Shamlaji
Limited
Financial year ending on
Currency
Exchange rate on the last day of financial year
Share capital (including share application money pending allotment)
Reserves
Liabilities
Total liabilities
Total assets
Investments (details on pages 184 to 191)
Turnover
Profit before taxation
Provision for taxation
Profit after taxation
Proposed dividend - equity
Proposed dividend - preference
31-3-2009
31-3-2009
31-3-2009
31-3-2009
31-3-2009
31-3-2009
3.50
(0.07)
0.02
3.45
3.45
–
–
(0.06)
0.01
(0.07)
–
–
45.89
127.86
350.81
524.56
524.56
–
–
(0.45)
0.02
(0.47)
–
–
0.05
–
8.81
8.86
8.86
–
–
–
–
–
–
–
1.02
(0.05)
0.06
1.03
1.03
–
0.01
(0.05)
–
(0.05)
–
–
1.02
(0.06)
0.08
1.04
1.04
–
0.01
(0.05)
0.01
(0.06)
–
–
1.02
(0.05)
0.05
1.02
1.02
–
0.01
(0.05)
–
(0.05)
–
–
A. M. NAIK
Chairman & Managing Director
Mumbai, May 28, 2009
183
Annexure to information on subsidiary companies
Details of investments as at 31-03-2009/31-12-2008
Name of the company
L&T Finance Limited
Long term investment (at cost):
Government securities:
No. of shares/
units/bonds
Face value Book-value
(Rs.crore)
(Rupees)
Quoted/
unquoted
12% National Saving Certificates 2002 (Rs.4000)
40
100
–
Unquoted
Subsidiary companies:
Fully paid equity shares:
L&T General Insurance Company Limited
50,000
Current investment:
Fully paid equity shares:
99,400
40,000
1,94,300
18,800
3,83,334
12,002
25,912
15,000
3,500
2,35,500
7,700
1,20,000
30,000
1,65,000
2,60,000
100
Metropoli Overseas Limited
Anil Chemicals and Industries Limited
Elque Polyesters Limited
Monnet Industries Limited
Intergrated Digital Info Services Limited
ABB Limited
Areva T&D India Limited
Axis Bank Limited
Bharat Heavy Electrical Limited
Gujarat NRE Coke Limited
Infosys Technologies Limited
Jaiprakash Associates Limited
Kotak Mahindra Bank Limited
Suzlon Energy Limited
Unitech Limited
Others:
LTF Securitisation Trust 2002 (Rs.1000)
SUB - TOTAL
Less: Provision for diminution in value of investments
TOTAL
Larsen & Toubro Infotech Limited
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
10
10
10
10
10
10
2
2
10
10
10
5
2
10
2
2
10
0.05
Unquoted
0.15
0.08
0.19
0.08
0.12
0.72
0.56
0.87
0.50
0.70
1.04
0.83
1.14
0.79
0.86
Unquoted
Unquoted
Unquoted
Unquoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
–
Unquoted
8.68
1.67
7.01
Larsen & Toubro Infotech GmbH
Larsen & Toubro Infotech Canada Limited
GDA Technologies Inc. USA, (at no par Value)
1
100
10
Euro 25,000
CAD 1 each
–
0.11
0.66
120.32
Unquoted
Unquoted
Unquoted
Current investment:
Liquid funds:
Birla Cash Plus - Institutional Premium - Growth
Birla Sun Life Savings Funds Institutional - Growth
ICICI Prudential Institutional Liquid Plan
- Super Institutional - Growth
ICICI Prudential Flexible Income Plan - Growth
UTI Liquid Cash Plan Institutional - Growth Option
15,72,076
97,76,604
39,02,984
85,66,494
7,769
10
10
10
10
1000
2.15
15.79
Unquoted
Unquoted
5.00
13.70
1.05
Unquoted
Unquoted
Unquoted
184
Annexure to information on subsidiary companies
Details of investments as at 31-03-2009/31-12-2008
Name of the company
Larsen & Toubro Infotech Limited (contd.)
UTI Money Market Fund - Growth Plan
UTI Treasury Advantage Fund (Institutional Plan)
- Growth Option
HDFC Cash Management Fund - Treasury Advantage Plan
- Wholesale - Growth
Income funds:
Birla Sun Life Income Plus - Growth
HDFC Income Fund - Growth
Short term plans:
HDFC Short Term Plan - Growth
Fixed maturity plans:
Birla Sun Life FTP - INSTL - Series BD - Growth
ICICI Purdential FMP Series 41-19 Months
ICICI Prudential Internal Fund Annual Internal Plan - I
Institutional Cumulative
Principal Pnb Fixed Maturity Plan (FMP 50:385 Days
Series IX - Aug 08 - Institutional Growth Plan)
TATA Fixed Horizon Fund Series 18 Scheme C
- Institutional Plan - Growth
Templeton Fixed Horizon Fund Series IX - Plan A - Growth
Templeton Fixed Horizon Fund Series IX - Plan B - Growth
UTI Fixed Term Income Fund Series IV - Plan VII
(May/8 - 12 Months) - Institutional Growth Plan
UTI - Fixed Term Income Fund Series VI (13 Months)
- Growth Plan
TOTAL
India Infrastructure Developers Limited
Current investment:
Liquid funds:
No. of shares/
units/bonds
Face value Book-value
(Rs.crore)
(Rupees)
Quoted/
unquoted
21,82,958
73,512
58,23,512
5,00,572
9,92,585
27,84,428
28,03,647
20,00,000
27,53,885
30,00,000
50,00,000
30,00,000
50,00,000
50,00,000
20,00,000
10
1000
10
10
10
10
10
10
10
10
10
10
10
10
10
5.35
Unquoted
8.50
Unquoted
10.93
Unquoted
1.98
1.99
Unquoted
Unquoted
4.58
Unquoted
2.80
2.00
Unquoted
Unquoted
3.00
Unquoted
3.00
Unquoted
5.00
3.00
5.00
Unquoted
Unquoted
Unquoted
5.00
Unquoted
2.00
Unquoted
222.91
Birla Sunlife Cash Plus - Institutional Premium - Growth
3,15,35,087
14.06
44.35
Unquoted
TOTAL
L&T Infocity Limited
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
44.35
Hyderabad International Trade Exposition Limited
L&T Infocity Lanka Private Limited
L&T Hitech City Limited
98,84,994
91,00,000
1,42,30,770
10
Sri Lankan Rs.10
10
9.88
4.23
14.23
Unquoted
Unquoted
Unquoted
Associate Company:
Fully paid equity shares:
Vizag IT Park Limited
TOTAL
23,40,000
10
2.34
Unquoted
30.68
185
Annexure to information on subsidiary companies
Details of investments as at 31-03-2009/31-12-2008
Name of the company
Larsen & Toubro International FZE (as at 31-12-2008)
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
Larsen & Toubro Saudi Arabia LLC
Larsen & Toubro Electromech LLC
Larsen & Toubro (Oman) LLC
Larsen & Toubro Qatar LLC
Larsen & Toubro (East Asia) SDN.BHD
Larsen &Toubro Overseas Projects Nigeria Limited
Larsen & Toubro Modular Fabrication Yard LLC
Larsen & Toubro Kuwait Construction General
Contracting Company WLL
L&T - Electricals Saudi Arabia Company Limited
Larsen & Toubro Readymix Concrete Industries LLC
Larsen & Toubro (Qingdao) Rubber Machinery
Company Limited
Larsen & Toubro (Jiangsu) Valve Company Limited
Offshore International FZC
Larsen & Toubro ATCO Saudia LLC
Larsen & Toubro Heavy Engineering LLC
L&T Electrical & Automation FZE
PT TAMCO Indonesia
Tamco Electrical Industries Australia Pty Limited
Tamco Shanghai Switchgear Co. Limited
TAMCO Switchgear (Malaysia) SDN. BHD
Larsen & Toubro (Wuxi) Electric Company Limited
Associate companies:
Fully paid equity shares:
L&T - Camp Facilities LLC
TOTAL
L&T-Sargent and Lundy Limited
Current investments:
Mutual fund:
Birla Sun Life - Qtly Interval - Series7 - Dividend Payout - FMP(3)
Birla Sun Life - Liquid Plus Institutional - FN Dividend
- Reinvestment
Birla Cash Plus - Institutional - Fortnightly Dividend - Payout
TATA Fixed Income Portfolio Fund Scheme B2
HDFC Income Fund
Reliance Money Manager Fund
HDFC CMF Treasury Advantage
TATA Liquid Super High Institutional
3,00,000
9,58,693
13,82,208
34,248
17,33,884
37,604
29,97,190
17,398
TOTAL
186
No. of shares/
units/bonds
Face value Book-value
(Rs.crore)
(Rupees)
Quoted/
unquoted
1,95,000
2,36,786
3,800 Saudi Riyal 1000 each
Omani Riyal 1 each
Omani Riyal 1 each
98 Qatari Riyal 1000 each
2,25,000 Malaysian Ringitt 1 each
Naira 1 each
Omani Riyal
99,99,998
6,50,000
–
150
490
980 Kuwaiti Dinar 1000 each
13,500 Saudi Riyal 1000 each
AED
1000 each
Aggregating to
USD 5,700,000
Aggregating to Chinese
Renminbi 44,800,000
AED 1000 each
Equity share of
USD 131,655
Equity share of
USD 273,104
Equity Share of
AED 1,000,000
Indonesian
Rupiah 2010 each
1,35,00,000 Australian Dollar 1 each
Aggregating to
USD 10,350,563
10,00,00,000 Malaysian Ringitt 1 each
Aggregating to
USD 6,080,217
2,47,500
1
–
3.31
8.55
0.14
0.01
0.34
8.24
16.63
17.54
0.65
27.76
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
27.68
Unquoted
0.20
0.64
Unquoted
Unquoted
1.33
Unquoted
1.33
Unquoted
24.88
Unquoted
25.14
50.42
Unquoted
Unquoted
344.98
29.62
Unquoted
Unquoted
Aggregating to
US Dollar 667,164
3.25
Unquoted
592.64
10
10
10
10
10
1000
10
1000
0.30
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
5.59
1.50
0.03
2.00
3.79
3.01
2.00
18.22
Annexure to information on subsidiary companies
Details of investments as at 31-03-2009/31-12-2008
Name of the company
L&T Infrastructure Development Projects Limited
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
No. of shares/
units/bonds
Face value Book-value
(Rs.crore)
(Rupees)
Quoted/
unquoted
L&T Transportation Infrastructure Limited
Narmada Infrastructure Construction Enterprise Limited
L&T Interstate Road Corridor Limited
L&T Krishnagiri Thopur Toll Road Limited
L&T Panipat Elevated Corridor Limited
L&T Vadodara Bharuch Tollway Limited
L&T Western Andhra Tollways Limited
L&T Urban Infrastructure Limited
L&T Infrastructure Development Projects Lanka (Private) Limited
International Seaports (India) Private Limited (Rs.45)
3,05,36,000
3,47,01,500
5,41,17,164
7,87,50,000
8,43,00,000
4,35,00,000
5,65,00,000
7,50,00,000
3,50,00,020
25,00,560
10
10
10
10
10
10
10
10
Srilankan Rs.10
10
53.14
63.90
54.12
78.75
84.30
43.50
56.50
75.00
15.72
–
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Fully paid preference shares:
L&T Urban Infrastructure Limited
Associate company:
Fully paid equity shares:
29,16,35,500
10
291.64
Unquoted
International Seaports Haldia (Private) Limited
Second Vivekananda Bridge Tollway Company Private Limited
Ennore Tank Terminals Private Limited
98,30,000
3,23,50,000
1,17,65,000
Fully paid preference shares:
Second Vivekananda Bridge Tollway Company Private Limited
1,00,00,000
10
10
10
10
9.83
32.35
11.77
Unquoted
Unquoted
Unquoted
10.00
Unquoted
Jointly controlled entity:
Fully paid equity shares:
The Dhamra Port Company Limited
15,85,59,066
10
158.56
Unquoted
Other companies:
Fully paid equity shares:
Bangalore International Airport Limited
SICAL Iron Ore Terminals Limited
6,53,82,000
71,50,000
10
10
65.38
7.15
Unquoted
Unquoted
Current investment:
Bonds:
Rural Electrification Corporation Limited - 5.25%
NCR taxable Bonds
TOTAL
L&T Capital Company Limited
Long term investment (at cost):
Fully paid equity shares:
Aplab Limited
Astra Microwave Products Limited
The Federal Bank Limited
NIIT Technologies Limited
Genus Power Infrastructure Limited
Jyoti Limited
500
10000
0.50
Unquoted
1112.11
1,48,580
53,00,030
79,95,619
29,20,000
19,471
5,59,437
10
2
10
10
10
10
1.28
23.00
123.76
31.87
0.48
6.04
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
187
Annexure to information on subsidiary companies
Details of investments as at 31-03-2009/31-12-2008
Name of the company
L&T Capital Company Limited (contd.)
No. of shares/
units/bonds
Face value Book-value
(Rs.crore)
(Rupees)
Quoted/
unquoted
Kalindee Rail Nirman (Engineers) Limited
Satyam Computer Services Limited
Salzer Electronics Limited
Catholic Syrian Bank Limited
TNJ Moduletech Private Limited
Salzer Cables Limited
Rangsons Electronics Limited
Feedback Ventures Private Limited
BSCPL Infrastructure Limited [formerly B. Seenaiah &
Company (Projects) Limited]
JSK Electricals Private Limited
16,72,496
3,02,12,750
9,15,808
7,19,677
8,00,000
74,48,000
10,65,000
37,90,000
3,05,808
21,20,040
TOTAL
Hyderabad International Trade Expositions Limited
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
10
2
10
10
10
5
10
10
10
Quoted
Quoted
Quoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
19.75
480.41
8.88
18.81
0.80
7.45
0.53
37.90
35.05
2.12
798.13
Andhra Pradesh Expositions Private Limited
10,000
10
TOTAL
Tractor Engineers Limited
Long term investment (at cost):
Fully paid equity shares:
Larsen & Toubro Saudi Arabia LLC (Rs.17,478)
Larsen & Toubro LLC
200
2,500
SAR - 1000 each
USD - 1 each
TOTAL
Larsen & Toubro Qatar LLC (as at 31-12-2008)
Long term investment (at cost):
Joint venture:
Larsen & Toubro Qatar & HBK Contracting Co. WLL - JV
100
QTR 100000
TOTAL
L&T Urban Infrastructure Limited
Long term investment (at cost):
Subsidiary companies:
Unquoted
0.01
0.01
Unquoted
Unquoted
–
0.01
0.01
Unquoted
0.13
0.13
Fully paid equity shares:
L&T Infocity Limited
L&T Phoenix Infoparks Private Limited
Cyber Park Development & Construction Limited
L&T Tech Park Limited
L&T South City Projects Limited
L&T Bangalore Airport Hotel Limited
L&T Vision Ventures Limited
CSJ Infrastructure Private Limited
2,40,30,000
2,55,00,000
5,10,000
1,17,30,000
2,88,02,880
5,32,80,000
33,995
3,21,23,000
10
10
10
10
10
10
10
10
16.02
25.50
0.51
11.73
70.53
53.28
0.03
160.46
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
188
Annexure to information on subsidiary companies
Details of investments as at 31-03-2009/31-12-2008
Name of the company
No. of shares/
units/bonds
Face value Book-value
(Rs.crore)
(Rupees)
Quoted/
unquoted
L&T Urban Infrastructure Limited (contd.)
L&T Arun Excello Commercial Projects Private Limited
Arun Excello Infrastructue Private Limited
Fully paid preference shares:
L&T Tech Park Limited
Associate company:
Fully paid equity shares:
L&T Cross Roads Private Limited
L&T Arun Excello Realty Private Limited
Joint controlled entity:
Fully paid equity shares:
4,89,600
93,67,347
28,05,000
90,00,000
3,16,800
L&T Bombay Developers Private Limited (Rs.50,000)
5,000
TOTAL
L&T Infrastructure Finance Company Limited
Long term investment (at cost):
BSCPL Infrastructure Limited [formerly B. Seenaiah &
Company (Projects) Limited]
Current investments:
Mutual fund:
2,18,150
Birla Sun Life - Cash Plus - Institutional Premium - Growth
Birla Sun Life - Savings Fund Institutional - Growth
IDFC Cash Fund - Super Institutional Plan C - Growth
1,77,76,261
2,40,47,566
2,33,44,414
TOTAL
L&T Power Limited (formerly L&T Power Projects Limited)
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
L&T-MHI Boilers Private Limited
L&T-MHI Turbine Generators Private Limited
5,10,51,000
5,10,51,000
TOTAL
Larsen & Toubro (Qingdao) Rubber Machinery Company Limited
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
Qingdao Larsen & Toubro Trading Company Limited
TOTAL
L&T-MHI Boilers Private Limited
Current investments:
Mutual fund:
10
10
10
10
10
10
10
10
10
10
12.94
71.92
Unquoted
Unquoted
5.61
Unquoted
9.00
29.14
Unquoted
Unquoted
0.01
Unquoted
466.68
25.00
Unquoted
Unquoted
Unquoted
Unquoted
25.00
40.00
25.00
115.00
10
10
51.05
51.05
Unquoted
Unquoted
102.10
0.54
Unquoted
0.54
HDFC Cash Management Fund (Treasury Plan)
1,19,82,544
19
23.02
Unquoted
TOTAL
23.02
189
Annexure to information on subsidiary companies
Details of investments as at 31-03-2009/31-12-2008
Name of the company
L&T-Valdel Engineering Limited
Current investments:
Mutual fund:
DSP Tiger Fund Growth
HSBC MIP Savings Plan
J P Morgan India Equity Fund
Tata Balanced Fund
Tata Infrastructure Fund
Birla Short Term Fund
Birla Sunlife Liquid Plus Installment Growth
HDFC Cash Management Fund
ICICI Prudential Flexible Income Plan
IDFC Money Manager Fund
TOTAL
GDA Technologies Inc.
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
GDA Technologies Limited
Current investment:
Fully paid equity shares:
Arkados
Citirix System
TOTAL
L&T Power Development Limited
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
No. of shares/
units/bonds
Face value Book-value
(Rs.crore)
(Rupees)
Quoted/
unquoted
44,692
4,54,852
1,46,699
99,101
80,156
42,05,025
10,257
84,24,144
20,16,390
37,23,607
10
10
10
10
10
10
10
10
10
10
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
0.11
0.49
0.09
0.29
0.14
4.29
0.02
8.44
2.13
3.75
19.75
1,67,234
10
0.18
Unquoted
1,50,000
114
12
1090
Unquoted
Quoted
0.19
0.01
0.38
L&T Uttaranchal Hydro Power Limited
4,80,49,994
Other companies:
Fully paid equity shares:
Everest Power Private Limited
Konaseema Gas Power Limited
TOTAL
L&T-MHI Turbine Generators Private Limited
Current investments:
Mutual fund
10,00,000
2,10,00,000
10
10
10
48.05
Unquoted
10.02
Unquoted
Unquoted
21.05
79.12
UTI Liquid Fund Cash Plan (Dividend Reinvestment)
96,05,836
19.2148
TOTAL
190
Unquoted
18.46
18.46
Annexure to information on subsidiary companies
Details of investments as at 31-03-2009/31-12-2008
Name of the company
L&T Transco Private Limited
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
L&T Port Sutrapada Limited
Sutrapada SEZ Developers Limited
L&T Chennai-Tada Tollway Limited
Sutrapada Shipyard Limited
Associate company:
Fully paid equity shares:
No. of shares/
units/bonds
Face value Book-value
(Rs.crore)
(Rupees)
Quoted/
unquoted
33,00,000
50,000
4,19,99,900
50,000
10
10
10
10
3.30
0.05
42.00
0.05
Unquoted
Unquoted
Unquoted
Unquoted
L&T PNG Tollway Private Limited
4,800
10
0.0048
Unquoted
TOTAL
L&T Realty Private Limited
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
L&T Realty FZE
Chennai Vision Developers Private Limited
1
10,000
AED - 150,000
10
TOTAL
L&T South City Projects Limited
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
45.40
Unquoted
Unquoted
0.16
0.01
0.17
L&T Siruseri Property Development Limited
50,000
10
0.05
Unquoted
TOTAL
L&T Capital Holdings Limited
Long term investment (at cost):
Subsidiary companies:
Fully paid equity shares:
L&T Finance Limited
L&T Infrastructure Finance Company Limited
India Infrastructure Developers Limited
Associate company:
Fully paid equity shares:
18,66,91,500
50,00,00,000
5,60,60,000
NAC Infrastructure Equipment Limited
45,00,000
Share application money pending allotment:
L&T Finance Limited
TOTAL
0.05
10
10
10
10
490.98
500.00
56.06
Unquoted
Unquoted
Unquoted
4.50
Unquoted
25.00
1076.54
–
191
This page is intentionally left blank
192
Consolidated Financial Statements 2008-2009
Auditors’ report to the Board of Directors of Larsen & Toubro Limited on
consolidated financial statements
We have examined the attached Consolidated Balance Sheet of Larsen & Toubro Limited and its subsidiaries, associates and joint ventures (the
L&T Group) as at March 31, 2009 and also the Consolidated Profit and Loss Account and the Consolidated Cash Flow Statement for the year
ended on that date, annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are prepared, in all material respects, in accordance with an
identified financial reporting framework and are free of material misstatements. An audit includes examining, on test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statements. We believe that our audit provides a reasonable basis for our
opinion.
In respect of the financial statements of certain subsidiaries, associates and joint ventures, we did not carry out the audit. These financial
statements have been audited/reviewed by other auditors whose reports have been furnished to us, and our opinion, insofar as it relates to the
amounts included in respect of the subsidiaries, associates and joint ventures is based solely on the reports of the other auditors. The details of
assets and revenues in respect of these subsidiaries and joint ventures and the net carrying cost of investment and current year/period share of
profit or loss in respect of these associates, to the extent to which they are reflected in the consolidated financial statements are given below:
Audited by other auditors:
A
B
C
Indian subsidiaries
Foreign subsidiaries
Joint ventures
D
Associates
Total assets
6398.85
1966.58
608.76
Net carrying cost of
investment
105.07
Rs.crore
Total revenues
486.96
3378.38
375.95
Current year/period
share of profit/(loss)
8.75
We further report that in respect of certain subsidiaries, associates and joint ventures, we did not carry out the audit. These financial statements
have been certified by management and have been furnished to us, and in our opinion, insofar as it relates to the amounts included in respect
of the subsidiaries, associates and joint ventures, are based solely on these certified financial statements.
Since the financial statements for the financial year ended March 31, 2009, which were compiled by management of these companies, were not
audited, any adjustments to their balances could have consequential effects on the attached consolidated financial statements. However, the
size of these subsidiaries, associates and joint ventures, in the consolidated position is not significant in relative terms. The details of assets and
revenues in respect of these subsidiaries and joint ventures and the net carrying cost of investment and current year/period share of profit or loss
in respect of these associates, to the extent to which they are reflected in the consolidated financial statements are given below:
Certified by management:
A
B
C
Indian subsidiaries
Foreign subsidiaries
Joint ventures
D
Associates
Total assets
158.58
0.03
7.13
Net carrying cost of
investment
68.13
Rs.crore
Total revenues
329.35
-
-
Current year/period
share of profit/(loss)
(13.54)
We report that, the consolidated financial statements have been prepared by the Company in accordance with the requirements of the Accounting
Standard (AS) 21, 'Consolidated Financial Statements', (AS) 23, 'Accounting for Investments in Associates in Consolidated Financial Statements'
and (AS) 27, 'Financial Reporting of Interests in Joint Ventures' notified by the Companies (Accounting Standards) Rules, 2006 and on the basis
of the separate audited/certified financial statements of the L&T Group included in the consolidated financial statements.
We report that on the basis of the information and according to the explanations given to us, and on the consideration of the separate audit report
on individual audited financial statements of the L&T Group, we are of the opinion that the said consolidated financial statements, read together
with significant accounting policies in Schedule Q and notes appearing thereon, give a true and fair view in conformity with the accounting
principles generally accepted in India:
a)
b)
in the case of the Consolidated Balance Sheet, of the state of affairs of the L&T Group as at March 31, 2009;
in the case of the Consolidated Profit and Loss Account of the consolidated results of operations of the L&T Group for the year ended on
that date; and
in the case of the Consolidated Cash Flow Statement, of the consolidated cash flows of the L&T Group for the year ended on that date.
c)
Mumbai, May 28, 2009
SHARP AND TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No.15882
193
Consolidated Balance Sheet as at March 31, 2009
Schedule
Rs.crore
Rs.crore
Rs.crore
Rs.crore
As at 31-3-2009
As at 31-3-2008
SOURCES OF FUNDS:
SHAREHOLDERS’ FUNDS:
Share capital
Reserves and surplus
Employee stock option outstanding
(previous year: Rs.317.97 crore)
Less: Deferred employee compensation expense
(previous year: Rs.173.66 crore)
Minority interest
LOAN FUNDS:
Secured loans
Unsecured loans
Deferred payment liabilities
Deferred tax liabilities [see note no.24]
TOTAL
APPLICATION OF FUNDS:
Fixed assets
Tangible assets
Gross block
Less: Depreciation and impairment
Net block
Less: Lease adjustment
Capital work-in-progress
Intangible assets
Gross block
Less: Amortisation and impairment
Net block
Capital work-in-progress
Fixed assets held for sale
(at lower of cost or estimated realisable value)
Investments
Loans and advances towards financing activities
Deferred tax assets [see note no.24]
Current assets, loans and advances:
Inventories
Sundry debtors
Cash and bank balances
Other current assets
Loans and advances
Less: Current liabilities and provisions:
Liabilities
Provisions
Net current assets
Miscellaneous expenditure
(to the extent not written-off or adjusted)
A
B
C
D
E (i)
E (ii)
F
G (i)
G (ii)
H
I
TOTAL
CONTINGENT LIABILITIES
SIGNIFICANT ACCOUNTING POLICIES
(For notes forming part of the consolidated accounts see page nos.217 to 242)
As per our report attached
SHARP & TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No.15882
Mumbai, May 28, 2009
N. HARIHARAN
Company Secretary
J
Q
Y. M. DEOSTHALEE
N. MOHAN RAJ
194
511.47
239.00
117.14
13598.09
58.47
10628.33
272.47
144.31
13987.70
1058.58
18399.95
1970.09
541.12
35957.44
9483.82
6105.30
0.08
6805.40
7109.94
410.29
10831.11
922.62
12119.91
196.02
327.04
24396.70
6291.27
2232.12
0.08
5552.28
6160.46
205.32
6560.14
5559.77
7090.04
1870.88
5219.16
239.36
4979.80
1311.47
783.68
293.16
490.52
1741.60
5019.00
8234.36
1560.78
38.62
4768.44
19621.20
13457.96
2236.61
15694.57
10494.94
7905.01
9125.00
2338.65
6786.35
239.36
6546.99
2936.83
3336.88
471.67
2865.21
3240.09
7105.78
11643.53
1459.04
68.22
6621.31
26897.88
17538.13
3317.42
20855.55
6042.33
0.28
35957.44
3926.63
28.54
24396.70
A. M. NAIK
Chairman & Managing Director
S. RAJGOPAL
M. M. CHITALE
BHAGYAM RAMANI
A. K. JAIN
Directors
Mumbai, May 28, 2009
Consolidated Profit and Loss Account for the year ended March 31, 2009
Schedule
Rs.crore
Rs.crore
Rs.crore
Rs.crore
2008-2009
2007-2008
K
L (i)
L (ii)
M
N
O
P
INCOME:
Sales & service (gross)
Less: Excise duty
Sales & service (net)
Other operational income
Other income
EXPENDITURE:
Manufacturing, construction and operating expenses
Staff expenses
Sales, administration and other expenses
Interest expenses and brokerage
Depreciation and obsolescence of tangible assets
Amortisation and impairment of intangible assets
Less: Overheads charged to fixed assets
Profit before transfer from revaluation reserve
Add: Transfer from revaluation reserve
Profit before tax before extraordinary items
Provision for current taxes [see note no.23(a)]
Provision for deferred tax [see note no.24]
Provision for tax on fringe benefits [see note no.23(b)]
Profit after tax before extraordinary items
Less: Additional tax on dividend distributed/proposed by subsidiary companies
(including proportionate share in respect of incorporated joint ventures)
Add: Share in profit/(loss) (net) of associate companies
Add/(less): Minority interest in (income)/losses
Profit after minority interest before extraordinary items
Gain/(loss) on extraordinary items (net of tax) [see note no.13]
Profit attributable to Group shareholders
Less: Dividend paid for the previous year
Additional tax on dividend paid for the previous year (net)
Profit available for appropriation
Less:Transfer to reserve u/s 45 IC of the RBI Act, 1934
Transfer to tonnage tax reserve
Transfer to reserve u/s 36(1)(viii) of the Income Tax Act, 1961
Transfer to debenture redemption reserve
Profit available for distribution
Interim dividend
Proposed final dividend
Additional tax on dividend
Balance carried to Balance Sheet
Basic earnings per equity share before
extraordinary items (Rupees)
Diluted earnings per equity share before
extraordinary items (Rupees)
Basic earnings per equity share after
} [see note no.20]
extraordinary items (Rupees)
Diluted earnings per equity share after
extraordinary items (Rupees)
Face value per equity share (Rupees)
SIGNIFICANT ACCOUNTING POLICIES
(For notes forming part of the consolidated accounts see page nos.217 to 242)
Q
40607.87
420.87
30212.84
2666.04
2666.82
461.96
537.54
192.09
36737.29
24.48
1328.35
35.36
61.16
0.28
0.05
40187.00
292.87
591.96
41071.83
36712.81
4359.02
1.31
4360.33
1424.87
2935.46
0.80
2934.66
50.90
2985.56
31.44
3017.00
772.46
3789.46
0.33
3789.13
35.27
1.10
2.03
43.34
3707.39
–
614.97
104.52
2987.90
51.56
50.87
64.76
63.89
2.00
29561.11
362.61
22002.90
2049.43
1709.62
203.11
408.78
102.99
26476.83
11.42
1039.27
31.74
76.11
0.66
0.11
29198.50
258.35
425.15
29882.00
26465.41
3416.59
2.03
3418.62
1147.12
2271.50
13.68
2257.82
135.83
2393.65
(68.29)
2325.36
–
2325.36
0.77
2324.59
33.20
–
1.77
–
2289.62
56.83
438.49
76.26
1718.04
40.44
38.95
40.44
38.95
2.00
As per our report attached
SHARP & TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No.15882
Mumbai, May 28, 2009
A. M. NAIK
Chairman & Managing Director
Y. M. DEOSTHALEE
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
BHAGYAM RAMANI
A. K. JAIN
N. HARIHARAN
Company Secretary
Directors
Mumbai, May 28, 2009
195
Consolidated Cash Flow Statement for the year ended March 31, 2009
...
...
...
...
...
...
...
...
...
...
...
Cash flow from operating activities:
Profit before tax (excluding minority interest and extraordinary items)
Adjustments for:
Dividend received
Depreciation (including obsolescence), amortisation and impairment
Lease equalisation
Exchange difference on items grouped under financing activity
Interest expense
Interest income
(Profit)/loss on sale of fixed assets (net)
(Profit)/loss on sale of investments (net)
Employee stock option - discount forming part of staff expenses
Provision/(reversal) for diminution in value of investments
Operating profit before working capital changes
Adjustments for:
(Increase)/decrease in trade and other receivables
(Increase)/decrease in inventories
(Increase)/decrease in miscellaneous expenditure
Increase/(decrease) in trade payables and customer advances
Cash generated from operations
Direct taxes refund/(paid) (net)
Net Cash (used in)/from operating activities
Cash flow from investing activities:
...
Purchase of fixed assets
...
Sale of fixed assets
...
Purchase of long term investments
...
Sale of long term investments
(Purchase)/sale of current investments (net)
...
Loans/deposits made with associates companies and third parties (net) ...
...
Advance towards equity commitment
...
Interest received
...
Dividend received from associates
...
Dividend received from other investments
...
Consideration received on disposal of subsidiaries
Consideration paid on acquisition of subsidiaries
...
Cash & cash equivalents acquired pursuant to acquisition of subsidiaries
Cash & cash equivalents discharged pursuant to disposal of a subsidiary
Cash (used in)/from investing activities (before extraordinary items)
Extraordinary items
Cash received (net of expenses) on sale/transfer of Ready Mix Concrete business
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
A.
B.
C.
...
...
(net of tax of Rs.279.37 crore)
...
Cash & cash equivalents discharged pursuant to disposal of Ready Mix Concrete business ...
Net Cash (used in)/from investing activities (after extraordinary items)
...
Cash flow from financing activities:
Proceeds from issue of share capital including shares under ESOP schemes
Proceeds from long term borrowings
Repayment of long term borrowings
(Repayments)/proceeds from other borrowings (net)
Payment (to)/from minority interest
Loans from associate/joint venture companies (net of repayments)
Dividends paid
Additional tax on dividend
Interest paid
Net cash (used in)/from financing activities
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
Net (decrease)/increase in cash and cash equivalents (A + B + C)
Cash and cash equivalents at beginning of the year
Cash and cash equivalents at end of the year
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
...
2008-2009
Rs.crore
2007-2008
Rs.crore
4360.33
(289.09)
728.32
–
374.35
461.96
(136.01)
(5.46)
(106.97)
174.79
9.62
5571.84
(5078.63)
(1947.85)
28.26
3072.66
1646.28
(1150.32)
495.96
(5477.59)
97.10
(878.22)
264.26
(550.22)
106.27
(0.69)
106.41
57.95
289.09
166.66
(412.93)
34.39
(0.51)
(6198.03)
1121.37
(0.23)
(5076.89)
23.04
5201.74
(523.54)
675.05
146.15
20.00
(438.77)
(70.56)
(553.92)
4479.19
(101.74)
1560.78
1459.04
3418.62
(152.10)
509.74
21.70
222.18
203.11
(113.56)
(20.21)
(117.35)
101.12
22.56
4095.81
(6793.86)
(1347.35)
(11.42)
3985.55
(71.27)
(1167.95)
(1239.22)
(3959.14)
336.93
(236.55)
79.44
(3041.77)
33.59
(10.68)
109.23
12.98
152.10
–
(84.85)
3.77
(10.39)
(6615.34)
–
–
(6615.34)
1701.58
4168.48
(622.67)
2584.21
177.15
–
(114.14)
(35.51)
(161.78)
7697.32
(157.24)
1718.02
1560.78
Notes:
1. Cash flow statement has been prepared under the indirect method as set out in the Accounting Standard (AS) 3 “Cash Flow Statements” as specified in the
Companies (Accounting Standards) Rules, 2006.
2. Purchase of fixed assets includes movement of capital work-in-progress during the year.
3. Cash and cash equivalents at the end of the year represent cash and bank balances and include unrealised gain of Rs.25.64 crore (previous year: unrealised
gain of Rs.0.43 crore) on account of translation of foreign currency bank balances.
4. For cash and cash equivalents not available for immediate use as on the Balance Sheet date, see note no.11(a) and (b) of notes forming part of consolidated
5. Previous year’s figures have been regrouped/reclassified wherever applicable.
A. M. NAIK
Chairman & Managing Director
Y. M. DEOSTHALEE
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
BHAGYAM RAMANI
A. K. JAIN
N. HARIHARAN
Company Secretary
Directors
Mumbai, May 28, 2009
accounts.
As per our report attached
SHARP & TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No.15882
Mumbai, May 28, 2009
196
Schedules forming part of the Consolidated Accounts
Schedule A
Share capital:
Authorised:
162,50,00,000 equity shares of Rs.2 each
(previous year: 1,62,50,00,000 equity shares of Rs.2 each)
Issued:
58,56,87,862 equity shares of Rs.2 each
(previous year: 29,23,27,390 equity shares of Rs.2 each)
Subscribed and paid-up:
58,56,87,862 equity shares of Rs.2 each [see note no.6]
(previous year: 29,23,27,390 equity shares of Rs.2 each)
Schedule B
Reserves and surplus:
Revaluation reserve:
As per last Balance Sheet
Addition during the year
Less: Transferred to Profit and Loss Account
Capital redemption reserve:
As per last Balance Sheet
Less: Utilised for issue of bonus shares
Capital reserve:
As per last Balance Sheet
Addition during the year
Capital reserve on consolidation:
As per last Balance Sheet
Deduction during the year
Reserve u/s 45 IC of the RBI Act, 1934:
As per last Balance Sheet
Add: Transferred from Profit and Loss Account
Debenture redemption reserve:
Created during the year
Securities premium account:
As per last Balance Sheet
Addition during the year
Less: Utilised for issue of bonus shares
Transfer to retained earnings
Share issue expenses
(Reversal)/write-back of provision made in previous year
Carried forward
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
325.00
117.14
117.14
117.14
325.00
58.47
58.47
58.47
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
25.90
7.52
1.31
3.16
0.02
10.81
35.80
15.98
0.28
75.75
35.27
4187.26
69.62
4256.88
58.50
0.01
–
(0.92)
32.11
3.14
46.61
15.70
111.02
43.34
4199.29
4451.21
27.93
–
2.03
3.16
–
10.67
0.14
16.52
0.54
42.55
33.20
2066.16
2135.14
4201.30
–
1.80
14.64
(2.40)
25.90
3.16
10.81
15.98
75.75
–
4187.26
4318.86
197
Schedules forming part of the Consolidated Accounts (contd.)
Schedule B (contd.)
Brought forward
Foreign projects reserve:
As per last Balance Sheet
Less: Transferred to retained earnings
Housing projects reserve:
As per last Balance Sheet
Less: Transferred to retained earnings
Tonnage tax reserve:
As per last Balance Sheet
Add: Transferred from Profit and Loss Account
Foreign currency translation reserve:
As per last Balance Sheet
Addition/(deduction) during the year
Reserve u/s 36(1)(viii) of Income Tax Act, 1961:
As per last Balance Sheet
Add: Transferred from Profit and Loss Account
Hedging reserve (net of tax):
As per last Balance Sheet
Addition during the year
Deduction during the year
Retained earnings:
As per last Balance Sheet
Less: Adjustments pertaining to deferred tax liabilities (net)
Add:Transferred from:
Foreign projects reserve
Housing projects reserve
Securities premium account
Profit and Loss Account
Schedule C
Secured loans:
Redeemable non-convertible fixed rate debentures
Redeemable non-convertible floating rate debentures
Loans from banks:
Cash credits/working capital demand loans
Other loans
Interest accrued and due
Loans from financial institutions
198
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
4451.21
4318.86
10.83
3.00
3.98
2.25
0.99
1.10
(11.24)
123.92
1.77
2.03
(4.85)
(282.40)
4.85
6307.99
–
6307.99
3.00
2.25
0.01
2987.90
7.83
1.73
2.09
112.68
3.80
19.19
8.36
7.96
3.98
0.99
–
(6.55)
(4.69)
–
1.77
–
(4.85)
–
10.83
3.98
0.99
(11.24)
1.77
(282.40)
(4.85)
4596.91
21.10
4575.81
8.36
3.98
1.80
1718.04
9301.15
13598.09
6307.99
10628.33
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
3615.00
4084.24
1.98
1700.00
200.00
7701.22
893.72
10494.94
2775.76
2300.69
0.05
1047.00
–
5076.50
436.64
6560.14
Schedules forming part of the Consolidated Accounts (contd.)
Schedule D
Unsecured loans:
Redeemable non-convertible fixed rate debentures
Redeemable non-convertible floating rate debentures
Fixed deposits
Short term loans and advances:
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
2145.09
25.33
0.46
18.89
640.00
4377.37
0.54
101.14
161.18
400.00
35.00
0.01
2829.77
4640.23
7905.01
1666.77
26.22
0.25
15.16
900.00
2542.50
0.15
121.10
187.61
100.00
–
0.01
2608.40
2851.36
5559.77
Cost/valuation
1-4-2008
As at Transfer on
business
combination
Additions Deductions
As at
31-3-2009
31-3-2008
Up to Transfer on
business
combination
Depreciation
Impairment
Book value
For the
year Deductions
Up to
31-3-2009
As at
31-3-2009
As at
31-3-2009
As at
31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
772.98
190.10
1117.30
0.25
3443.45
277.14
133.27
9.26
785.40
347.44
113.64
–
7.45
–
52.21
–
88.89
73.59
238.24
–
92.45 1686.03
65.16
5.76
66.88
4.55
–
–
–
6.23
–
–
863.09
35.96
263.69
184.19
4.33 1403.42
0.25
0.25
268.66 4953.27 1134.05
120.59
328.61
19.45
73.30
188.38
16.32
7.47
9.26
–
–
–
–
–
33.56
104.51
30.22
–
254.76
24.93
24.65
–
564.20
427.02
119.21
–
262.77
19.08
41.50
–
–
–
5.65
–
66.13
3.92
3.52
–
–
–
–
–
–
19.05
37.25
–
361.47
37.40
21.92
0.52
35.66
8.03
17.41
–
–
–
0.38
–
–
55.01
226.71
0.25
51.38 1510.27
144.88
17.03
90.01
8.73
7.99
–
74.54
1.51
15.82
–
223.89
25.60
43.09
–
772.98
863.09
–
154.12
–
208.68
960.17
– 1176.71
–
–
–
– 3443.00 2255.01
153.74
–
55.80
–
1.78
–
183.73
98.37
1.27
6.93
–
–
–
333.38
401.42
76.12
(239.36)
509.55
283.19
72.14
(239.36)
7190.23
162.42 2387.08
619.33 9120.40 1879.16
79.22
538.71
169.39 2327.70
6.93 6546.41 4979.12
4.23
1.10
5.33
–
–
–
0.01
–
0.01
0.57
0.17
0.74
3.67
0.93
4.60
3.24
1.06
4.30
–
–
–
0.39
0.02
0.41
0.54
0.15
0.69
3.09
0.93
4.02
–
–
–
0.58
–
0.58
0.64
0.04
0.68
7195.56
162.42 2387.09
620.07 9125.00 1883.46
79.22
539.12
170.08 2331.72
6.93 6546.99 4979.80
5547.68
124.62 1985.06
567.32 7090.04 1713.44
1.42
404.69
255.60 1863.95
6.93
2936.83 1311.47
9483.82 6291.27
199
From banks
From others
Lease finance
Sales tax deferment loan
Commercial paper
Other loans and advances:
From banks
Lease finance
Sales tax deferment loan
From others
Schedule E (i)
Fixed Assets - Tangible:
Particulars
OWNED ASSETS:
Land-freehold
Ships
Buildings
Railway sidings
Plant and machinery
Furniture and fixtures
Vehicles
Aircraft
Owned assets given on operating lease
Plant and machinery
Buildings
Vehicles
Lease adjustment
Owned assets (sub total - A)
LEASED ASSETS:
Assets taken under finance lease:
Plant and machinery
Vehicles
Asset taken under finance lease (sub total - B)
Total (A+B)
Previous year
Add: Capital work-in-progress
Schedules forming part of the Consolidated Accounts (contd.)
Schedule E (ii)
Fixed Assets - Intangible:
Particulars
Goodwill on consolidation
Land-leasehold
Specialised softwares
Lumpsum fees for technical knowhow
Toll collection rights
Trade marks
Total
Previous year
Add: Capital work-in-progress
Cost/valuation
1-4-2008
As at Transfer on
business
combination
Additions Deductions
As at
31-3-2009
31-3-2008
Up to Transfer on
business
combination
Amortisation
Impairment
Book value
For the
year Deductions
Up to
31-3-2009
As at
31-3-2009
As at
31-3-2009
As at
31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Rs.crore
251.69
95.63
134.58
20.61
288.46
–
216.23
–
467.92
26.85
–
40.09
–
8.92
0.21
1.89
247.51
4.94
347.12
7.60
74.57
13.28
196.08
92.79
6.50
0.57
28.43
9.53
0.24
0.20
1.02
3.43
0.23
32.62
13.28
112.33
7.01
0.57
16.99
66.94
11.04
–
–
218.53
3.84
42.00
358.98
224.12
–
–
–
336.08
83.75
11.44
80.45
41.59
10.86
– 2070.91
133.50
–
4.05
–
– 2000.98
– 2289.44
154.98
–
63.55
1.50
1.50
4.89
–
7.89
1.50
792.47
12.52 2550.68
18.79 3336.88
293.25
1.50
2.96
0.84
147.54
14.08
429.67
42.00 2865.21
490.52
553.26
1.84
239.02
10.44
783.68
190.99
1.15
101.92
1.62
292.44
0.72
3240.09 1741.60
6105.30 2232.12
Notes:
(i)
1
(ii)
In respect of tangible assets, opening gross block includes Rs.105.52 crore and opening accumulated depreciation includes Rs.19.51
crore on account of exchange differences on translation of value of assets in respect of non integral foreign operations.
In respect of intangible assets, opening gross block includes Rs.8.79 crore and opening accumulated amortisation includes Rs.0.81
crore on account of exchange differences on translation of value of assets in respect of non integral foreign operations.
Cost/Valuation of:
(i)
(ii)
Freehold land includes Rs.19.42 crore for which conveyance is yet to be completed.
Leasehold land includes:
(a) Rs.2.63 crore for land taken at Mysore on lease from KIADB vide agreement dated May 5, 2006. The lease agreement is for a
period of six years, with extension of 3 years, at the end of which sale deed would be executed, on fulfilment of certain conditions
by the Company.
(b) Rs.15.25 crore for land taken on Lease from Maharashtra Airport Development Company Limited for a period of 99 years with
effect from June 01,2008 vide agreement dated June 20, 2008 for developing IT Infrastructure facilities.
(c) Rs.0.22 crore for land taken at Hubli on lease from KIADB vide agreement dated December 8, 2005. The lease agreement is for
a period of six years, at the end of which sale deed would be executed, on fulfilment of certain conditions by the Company.
Cost/Valuation of buildings includes ownership accommodation:
(i)
(a)
in various co-operative societies and apartments and shop-owners’ associations: Rs.96.86 crore, including 2325 shares of Rs.50
each, 207 shares of Rs.100 each and 1 share of Rs.250.
in proposed co-operative societies Rs.17.29 crore.
(b)
of Rs.4.39 crore in respect of which the deed of conveyance is yet to be executed.
(ii)
(iii) of Rs.8.45 crore representing undivided share in a property at a certain location.
Cost/Valuation of buildings includes Rs.46.57 crore for building constructed on lease hold land 90.36 acres (20 acres since surrendered) on
a 66 years lease agreement entered with National Academy of Construction (NAC) dated October 1, 2005, yet to be registered with
appropriate authority.
Additions during the year and capital work-in-progress include Rs.197.77 crore being borrowing cost capitalised in accordance with Accounting
Standard (AS) 16 on “Borrowing Costs”
Depreciation for the year on tangible assets include obsolescence Rs.1.38 crore (previous year: Rs.3.88 crore) and on intangible assets
Rs.41.28 crore (previous year: Rs.nil) on account of impairment loss.
Capital work-in-progress - tangible assets includes advances Rs.683.68 crore (previous year: Rs.356.07 crore). Capital work-in-progress
- intangible assets includes advances Rs.nil (previous year: Rs.1.40 crore) and Rs.1.74 crore (previous year: Rs.nil) on account of expenditure
incurred on exploration and evaluation of potential mineral reserves.
The Company had revalued as at October 1,1984 some of its land, buildings, plant and machinery and railway sidings at replacement/
market value which resulted in a net increase of Rs.108.05 crore. One of the subsidiaries has revalued land during the year, based on an
estimated market valuation recommended by an external valuer as at March 31, 2008 which resulted in the net increase of Rs.24.69 crore.
Owned assets given on operating lease have been presented separately under tangible assets schedule as per Accounting Standard (AS)
19 on “Leases”.
2
3
4
5
6
7
8
9
200
Schedules forming part of the Consolidated Accounts (contd.)
Schedule F
Investments (at cost, unless otherwise specified):
Long term investments:
Government and trust securities
Investment in associates: [see note below]
Fully paid equity shares of associate companies
Fully paid preference shares of associate companies
Add/(deduct):
Accumulated share in profit/(loss) of the associate companies at
the beginning of the year
Adjustment pursuant to disposal of stake in associates
Add/(deduct):
Share in profit/(loss) (net) of associate companies - current year
Commitment to fresh infusion of equity
Dividend received from associate companies during the year
Unrealised profits in respect of transactions with associate companies
Provision for diminution in value
Other fully paid equity shares
Bonds
Mutual funds
Current investments:
Government and trust securities (previous year: Rs.186.47 crore)
Less: Provision for diminution in value
(previous year: Rs.4.02 crore)
Other fully paid equity shares (previous year: Rs.0.62 crore)
Less: Provision for diminution in value
(previous year: Rs.0.50 crore)
Bonds (previous year: Rs.59.20 crore)
Less: Provision for diminution in value
(previous year: Rs.1.85 crore)
Mutual funds (previous year: Rs.4354.53 crore)
Less: Provision for diminution in value
(previous year: Rs.23.35 crore)
Investment other securities short term
–
–
8.66
1.67
258.46
4.36
3604.14
3.84
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
0.50
6.39
220.78
10.00
230.78
351.64
(23.04)
559.38
50.90
3.16
(57.95)
(71.17)
(0.56)
–
6.99
254.10
3600.30
1356.98
483.76
1102.27
0.50
–
1587.03
242.75
10.00
252.75
228.79
–
481.54
135.83
3.16
(12.98)
(69.71)
(0.56)
182.45
0.12
57.35
4331.18
–
537.28
211.79
225.68
0.04
981.18
Note: Investments in associates include goodwill of Rs.35.71 crore (previous year: Rs.44.73 crore), net of cumulative amortisation of Rs.6.21
crore (previous year: Rs.5.71 crore) and is net of capital reserve of Rs.0.01 crore (previous year: Rs.nil)
201
5218.37
6805.40
4571.10
5552.28
Schedules forming part of the Consolidated Accounts (contd.)
Schedule G (i)
Loans and advances towards financing activities
Secured loans:
Considered good:
Loans against pledge of shares and securities
Infrastructure loans
Considered doubtful:
Infrastructure loans
Less: Provision for non performing assets
Unsecured loans:
Considered good:
Bills discounted
Other loans
Advance towards lease capital assets
Considered doubtful:
Other loans
Less: Provision for non performing assets
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
7.70
7.70
8.08
8.08
364.17
2267.29
–
219.97
4258.51
–
–
7109.94
–
–
3.54
3.54
318.95
1833.18
–
230.94
3761.12
16.27
–
6160.46
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Schedule G (ii)
Current assets, loans and advances:
Current Assets:
Inventories:
Stock-in-trade, at cost or net realisable value whichever is lower:
Raw materials
Components
Construction materials
Stores, spare parts and loose tools
Finished goods
Property development land
Completed property
Work-in-Progress:
Manufacturing work-in-progress at cost or net
realisable value whichever is lower
Construction and project related work-in-progress
At cost
At estimated realisable value on sale
Less: Progress bills raised
Due from customers
Total work-in-progress
Stock on hire:
Carried forward
202
557.06
343.91
118.83
116.23
464.65
323.85
9.75
1934.28
566.26
1831.07
22437.29
24268.36
19664.24
4604.12
5170.38
1.12
367.15
265.13
69.04
116.34
349.60
203.22
0.09
1370.57
464.30
1839.35
16052.73
17892.08
14710.31
3181.77
3646.07
2.36
7105.78
7105.78
5019.00
5019.00
Schedules forming part of the Consolidated Accounts (contd.)
Schedule G (ii) (contd.)
Brought forward
Sundry debtors:
Unsecured:
Debts outstanding for more than 6 months
Considered good
Considered doubtful
Other debts:
Considered good
Less: Provision for doubtful debts
Cash and bank balances:
Cash on hand
Cheques on hand
Balances with scheduled banks:
on current accounts
on fixed deposits including interest accrued thereon
[see note no.11(a)]
on margin money deposit accounts
Balances with non-scheduled banks [see note no.11(b)]
Other current assets:
Interest accrued on investments
Others
Loans and advances:
Secured, considered good:
Loans against mortgage of house property
Unsecured:
Considered good:
Associate companies
Advances recoverable
Advances towards equity commitment
Others
Inter-corporate deposits
Associate companies
Others
Advances recoverable in cash or in kind [see note no.16]
Balance with customs, port trust, etc.
Lease receivables
Considered doubtful:
Deferred credit against sale of ships
Advances recoverable in cash or in kind
Less: Provision for doubtful loans and advances
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
7105.78
5019.00
2421.82
442.18
2864.00
9221.71
12085.71
442.18
11.42
285.24
472.10
284.82
19.33
386.13
17.05
51.17
21.93
26.29
0.69
5.00
5.86
6522.47
37.27
1.80
21.09
63.86
6706.26
84.95
1830.54
291.39
2121.93
6403.82
8525.75
291.39
11643.53
8234.36
11.15
273.61
755.14
313.76
9.25
197.87
14.40
24.22
1560.78
1459.04
68.22
38.62
24.94
15.37
10.68
10.00
58.92
4619.52
27.01
2.00
16.69
29.07
4814.20
45.76
6621.31
26897.88
4768.44
19621.20
203
Schedules forming part of the Consolidated Accounts (contd.)
Schedule H
Current liabilities and provisions:
Liabilities:
Acceptances
Sundry creditors:
Due to: Micro and small enterprises
Others [see note no.10]
Due to customers:
Progress bills raised
Less: Construction and project related work-in-progress
At cost (previous year: Rs.1053.49 crore)
1939.22
At estimated realisable value
(previous year: Rs.16447.45 crore)
22553.07
Advances from customers
Items covered by Investor Education and Protection Fund
Unpaid dividend
Unpaid matured deposits
Unpaid matured debentures/bonds
Interest accrued on bonds
Due to directors
Interest accrued but not due on loans
Pension payable under Voluntary Retirement-cum-Pension Scheme
Provisions for:
Current taxes
Tax on fringe benefits
Proposed dividend
Additional tax on dividend
Gratuity
Compensated absences
Employee pension schemes
Post-retirement medical benefit plan
Long service awards
Other provisions [see note no.21]
204
As at 31-3-2009
As at 31-3-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
58.54
68.42
11.28
8898.31
4.38
6944.49
8909.59
6948.87
27575.35
20216.22
24492.29
17500.94
3083.06
5355.74
2715.28
3634.24
10.33
0.13
0.15
0.02
1570.89
61.36
614.97
104.52
0.93
292.11
151.81
74.40
8.36
438.07
9.61
0.23
1.58
0.03
10.63
36.37
84.20
–
11.45
22.86
56.80
0.04
17538.13
13457.96
1057.95
78.67
438.49
69.71
0.75
250.29
151.35
58.74
17.40
113.26
3317.42
20855.55
2236.61
15694.57
Schedules forming part of the Consolidated Accounts (contd.)
Schedule I
Miscellaneous expenditure
(to the extent not written off or adjusted)
Voluntary Retirement-cum-Pension Schemes/Voluntary Retirement Schemes
Preliminary expenses
Schedule J
Contingent liabilities:
(a) Claims against the Company not acknowledged as debts
(b) Sales-tax liability that may arise in respect of matters in appeal
(c) Excise duty/service tax liability that may arise in respect of
matters in appeal/challenged by the Company in WRIT
(d) Customs duty demands against which the Group has filed
(e)
appeals before appellate authorities which are pending disposal.
Income-tax liability (including interest and penalty) that may arise
in respect of which the Company is in appeal
(f) Guarantees given on behalf of associate companies
As at 31-3-2009
Rs.crore
As at 31-3-2008
Rs.crore
0.28
–
0.28
3.13
25.41
28.54
As at 31-3-2009
Rs.crore
As at 31-3-2008
Rs.crore
199.94
82.99
15.30
0.54
102.24
–
117.07
223.46
13.03
–
40.95
10.00
Notes:
1. The Company does not expect any reimbursements in respect of the above contingent liabilities.
2.
It is not practicable to estimate the timing of cash outflows, if any, in respect of matters at (a) to (e) above pending resolution of the
arbitration/appellate proceedings.
In respect of matters at (f), the cash outflows, if any, could generally occur during the next three years, being the period over which the
validity of the guarantees extends except in a few cases where the cash outflows, if any, could occur.
3.
Schedule K
Sales & service:
Manufacturing, trading and property development activity
Construction and project related activity
Software development products and services
Income from financing activity/annuity based projects
Facilitating charges for power plant
Toll collection and related activity
Servicing
Commission
Engineering and service fees
2008-2009
Rs.crore
6811.46
29824.12
2068.74
1124.81
–
97.24
293.64
210.37
177.49
40607.87
2007-2008
Rs.crore
6493.76
20030.30
1671.72
638.02
121.14
60.54
219.98
221.66
103.99
29561.11
205
Schedules forming part of the Consolidated Accounts (contd.)
2008-2009
Rs.crore
2007-2008
Rs.crore
93.65
3.29
13.33
4.67
0.25
3.68
3.23
170.77
292.87
113.11
4.57
10.47
6.59
2.20
1.63
19.06
100.72
258.35
2008-2009
2007-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
58.03
12.71
65.27
11.81
0.30
74.29
27.79
11.48
136.01
113.56
–
2.42
12.11
276.98
10.93
12.70
94.27
2.23
38.50
8.23
591.96
2.42
149.68
9.48
61.62
55.73
1.15
31.51
–
425.15
Schedule L (i)
Other operational income:
Equipment and property rentals
Technical fees
Property maintenance recoveries
Facility management income
Consultancy income
Parking recoveries
Profit on sale of fixed assets (net)
Miscellaneous income
Schedule L (ii)
Other income:
Interest income:
Interest received on inter-corporate deposits from
associate companies, customers and others
Income from long term investments:
Interest on debentures, bonds and Government securities
Income from current investment:
Interest on debentures, bonds and Government securities
Dividend Income:
From long term investments:
Trade investments
Other investments
Dividend income from current investments
Lease rental income
Profit on sale of long term investments (net) [see note no.15(a)]
Profit on sale of current investments (net)
Profit on sale of fixed assets (net)
Miscellaneous income
Provision no longer required written back
206
Schedules forming part of the Consolidated Accounts (contd.)
2008-2009
2007-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
Schedule M
Manufacturing, construction and operating expenses:
Materials consumed:
Raw materials and components
Construction materials
Less: Scrap sales
Purchase of trading goods
(Increase)/decrease in manufacturing and trading stocks:
Closing stock:
Finished goods
Work-in-progress
Less: Opening stock:
Finished goods (Including stock of Rs.10.19 crore acquired
on acquisition of subsidiaries)
Work-in-progress (Including stock of Rs.3.50 crore acquired
on acquisition of subsidiaries)
Sub-contracting charges
Stores, spares and tools
Excise duty
Power and fuel
Royalty and technical know-how fees
Packing and forwarding
Hire charges - plant and machinery and others
Engineering, professional, technical and consultancy fees
Insurance
Rent
Rates and taxes
Travelling and conveyance
Repairs to plant and machinery
Repairs to buildings
General repairs and maintenance
Interest and other financing charges
Software development expenses
Cost of built up technology park space and property development land:
Opening stock
Work-in-progress
Completed property
Property development land
Add: Expenses on construction during the year
Less: Internal capitalisation during the year
Less: Closing stock
Work-in-progress
Completed property
Property development land
Other expenses
7242.64
8446.23
15688.87
69.78
464.65
1535.29
1999.94
359.79
1405.81
1765.60
128.21
0.09
203.22
331.52
309.62
641.14
12.87
628.27
174.58
9.75
323.85
508.18
6374.82
5968.37
12343.19
73.26
15619.09
1644.52
12269.93
1630.20
349.60
1402.31
1751.91
264.43
704.92
969.35
125.24
6.16
128.13
259.53
177.38
436.91
6.28
430.63
128.21
0.09
203.22
331.52
(782.56)
4961.64
777.08
1.56
426.30
13.04
86.12
290.85
325.97
80.16
70.44
22.32
211.82
58.22
10.84
79.82
363.37
865.79
99.11
140.88
22002.90
207
(234.34)
7667.78
1070.32
(5.22)
555.92
24.49
123.65
407.59
418.72
81.23
136.60
34.89
284.83
53.55
12.14
102.31
637.68
1257.35
120.09
199.65
30212.84
Schedules forming part of the Consolidated Accounts (contd.)
Schedule N
Staff expenses:
Salaries, wages and bonus
Contribution to and provision for:
Provident fund and pension fund
Superannuation/employee pension schemes
Gratuity funds
Compensated absences/leave encashment
Welfare and other expenses
Schedule O
Sales, administration and other expenses:
Power and fuel
Packing and forwarding
Professional fees
Insurance
Rent
Rates and taxes
Travelling and conveyance
Repairs to buildings
General repairs and maintenance
Directors’ fees
Telephone, postage and telegrams
Advertising and publicity
Stationery and printing
Commission:
Distributors and agents
Others
Bank charges
Miscellaneous expenses [see note no.15 (b)]
Bad debts and advances written off
Less: Provision for doubtful debts and advances written back
Discount on sales
Provision for doubtful debts, advances and non-performing assets (net)
Provision for foreseeable losses on construction contracts
Provision for diminution in value of investments (net)
Other provisions [see note no.21]
Schedule P
Interest expenses and brokerage:
Debentures and fixed loans
Others
208
2008-2009
2007-2008
Rs.crore
Rs.crore
Rs.crore
Rs.crore
2148.62
1598.84
74.94
46.79
32.37
30.21
63.51
71.83
30.96
1.87
184.31
333.11
2666.04
33.63
203.33
186.59
25.37
174.19
62.24
327.68
18.78
128.63
0.33
110.06
66.98
45.03
55.08
78.78
624.73
11.74
45.60
264.69
55.65
9.62
138.09
2666.82
322.26
139.70
461.96
168.17
282.42
2049.43
21.30
200.25
127.97
20.93
124.63
55.78
248.22
26.20
105.20
0.29
90.49
61.62
36.70
42.61
59.23
276.14
0.82
47.43
101.80
24.46
22.56
14.99
1709.62
112.21
90.90
203.11
33.25
9.36
46.10
45.28
43.58
11.50
87.08
75.34
Schedules forming part of the Consolidated Accounts (contd.)
SCHEDULE Q
SIGNIFICANT ACCOUNTING POLICIES
1. Basis of accounting
The Company maintains its accounts on accrual basis following the historical cost convention in accordance with generally accepted
accounting principles [GAAP] except for the revaluation of certain fixed assets, and in compliance with the provisions of the Companies Act,
1956 and the Accounting Standards [as specified in the Companies (Accounting Standards) Rules, 2006, prescribed by the Central
Government]. However, certain escalation and other claims, which are not ascertainable/acknowledged by customers, are not taken into
account.
The preparation of financial statements in conformity with GAAP requires that the management of the Company makes estimates and
assumptions that affect the reported amounts of income and expenses of the period, the reported balances of assets and liabilities and the
disclosures relating to contingent liabilities as of the date of the financial statements. Examples of such estimates include the useful lives of
tangible and intangible fixed assets, provision for doubtful debts/advances, future obligations in respect of retirement benefit plans, etc.
Difference, if any, between the actual results and estimates, is recognised in the period in which the results are known.
The accounts of Indian subsidiaries, joint ventures and associates have been prepared in compliance with the Accounting Standards as
specified in the Companies (Accounting Standards) Rules, 2006, prescribed by the Central Government, and those of the foreign subsidiaries,
joint ventures and associates have been prepared in compliance with the local laws and applicable accounting standards. Necessary
adjustments for differences in the accounting policies, wherever applicable, have been made in the consolidated financial statements.
2. Revenue recognition
Revenue is recognised based on the nature of activity when consideration can be reasonably measured and there exists reasonable
certainty of its recovery.
a)
Sales and service
i)
Sales and service include excise duty and adjustments made towards liquidated damages and price variation wherever applicable.
ii)
Revenue from sale of goods is recognised when the substantial risks and rewards of ownership are transferred to the buyer
under the terms of the contract.
iii) Revenue from property development activity is recognised when all significant risks and rewards of ownership in the land and/or
building are transferred to the customer and a reasonable expectation of collection of the sale consideration from the customer
exists.
iv) Revenue from construction/project related activity and contracts for supply/commissioning of complex plant and equipment is
recognised as follows:
a) Cost plus contracts: Contract revenue is determined by adding the aggregate cost plus proportionate margin as agreed with
the customer.
b)
Fixed price contracts received up to March 31, 2003: Contract revenue is recognised by applying percentage of completion
to the contract value. Percentage of completion is determined as follows:
i)
ii)
in the case of item rate contracts, as a proportion of the progress billing to contract value; and
in the case of other contracts, as a proportion of the cost incurred-to-date to the total estimated cost.
c)
Fixed price contracts received on or after April 1, 2003: Contract revenue is recognised by adding the aggregate cost and
proportionate margin using the percentage completion method. Percentage of completion is determined as a proportion of
cost incurred-to-date to the total estimated contract cost.
Full provision is made for any loss in the period in which it is foreseen.
v) Revenues from construction/project related activity and contracts executed in joint ventures under work-sharing arrangement
[being jointly controlled operations, in terms of Accounting Standard (AS) 27 "Financial Reporting of Interests in Joint Ventures"],
is recognised on the same basis as similar contracts independently executed by the Company.
vi) Revenue from software development is recognised based on software developed or time spent in person hours or person weeks,
and billed to customers as per the terms of specific contracts.
vii)
Income from hire purchase and lease transactions is accounted on accrual basis, pro-rata for the period, at the rates implicit in
the transaction. Income from bill discounting, advisory and syndication services and other financing activities is accounted on
accrual basis.
viii) Facilitation earnings are recognised based on the availability of the facilities for generation of electricity and steam.
209
Schedules forming part of the Consolidated Accounts (contd.)
ix) Revenue relatable to construction services rendered in connection with Build-Operate-Transfer (BOT) projects undertaken by
the group is recognised during the period of construction using percentage of completion method. Revenue relatable to toll
collections of such projects from users of facilities are accounted when the amount is due and recovery is certain. Licence fees
for way-side amenities are accounted on accrual basis. Revenue from annuity based projects is recognised in the Profit and Loss
Account over the concession period of the respective projects based on the implicit rate of return embedded in the projected cash
flows. Such income is duly adjusted for any variation in the amount and timing of the cash flows in the period in which such
variation occurs.
x) Revenue from service related activities is recognised using the proportionate completion method or completed service contract
method.
xi) Commission income is recognised as and when the terms of the contract are fulfilled.
xii) Revenue from engineering and service fees is recognised as per the terms of the contract.
xiii) Government subsidy related to shipbuilding contracts is recognised on a prudent basis in the Profit and Loss Account as revenue
from operations in proportion to work completed when there is reasonable assurance that the conditions for the grant of subsidy
will be fulfilled.
b)
Profit/loss on contracts executed by integrated joint ventures under profit-sharing arrangement [being jointly controlled entities, in
terms of Accounting Standard (AS) 27 "Financial Reporting of Interests in Joint Ventures"] is accounted as and when the same is
determined by the joint venture. Revenue from services rendered to such joint ventures is accounted on accrual basis.
c) Other operational income represents income earned from the activities incidental to the operations of the business segments and is
recognised on rendering of related services as per the terms of the contract.
d)
Interest income is accrued at applicable interest rate.
e) Other items of income are accounted as and when the right to receive arises.
3.
Principles of consolidation
a)
The financial statements of the Parent Company and its subsidiaries have been consolidated on a line-by-line basis by adding
together the book values of the like items of assets, liabilities, income and expenses, after eliminating intra-group balances and the
unrealised profits/losses on intra-group transactions, and are presented to the extent possible, in the same manner as the Company's
independent financial statements.
b)
Investments in associate companies have been accounted for, by using the equity method whereby investment is initially recorded at
cost and the carrying amount is adjusted thereafter for post acquisition change in the Company's share of net assets of the associate.
c)
The Company's interests in joint ventures are consolidated as follows:
Type of Joint Venture
Accounting treatment
Jointly Controlled Operations Company's share of revenues, common expenses, assets and liabilities are included in revenues,
expenses, assets and liabilities respectively.
Jointly Controlled Assets
Jointly Controlled Entities
Share of the assets, and share of the liabilities are shown as part of gross block and liabilities
respectively according to their nature. Share of expenses incurred on maintenance of the assets
is accounted as expense. Monetary benefits, if any, from use of the assets are reflected as income.
The Company's interest in jointly controlled entities are consolidated on a line-by line basis by
adding together the book values of assets, liabilities, income and expenses, after eliminating the
unrealised profits/losses on intra group transactions.
Joint venture interests accounted as above are included in the segments to which they relate.
4. Research and development
Revenue expenditure on research and development is charged under respective heads of account in the year in which it is incurred. Capital
expenditure on research and development is included as part of fixed assets and depreciated on the same basis as other fixed assets.
Employee benefits
a)
Short term employee benefits
All employee benefits falling due wholly within twelve months of rendering the service are classified as short term employee benefits.
The benefits like salaries, wages, short term compensated absences, etc. and the expected cost of bonus, ex-gratia, are recognised
in the period in which the employee renders the related service.
5.
210
Schedules forming part of the Consolidated Accounts (contd.)
b)
Post-employment benefits
i)
ii)
Defined contribution plans: The Company's superannuation scheme, state governed provident fund scheme, insurance scheme
and employee pension scheme are defined contribution plans. The contribution paid/payable under the schemes is recognised
during the period in which the employee renders the related service.
Defined benefit plans: The employees gratuity fund schemes, post-retirement medical care schemes, pension scheme and
provident fund scheme managed by trust are the Company's defined benefit plans. Wherever applicable, the present value of the
obligation under such defined benefit plans is determined based on actuarial valuation using the Projected Unit Credit Method,
which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit
separately to build up the final obligation.
The obligation is measured at the present value of the estimated future cash flows. The discount rate used for determining the
present value of the obligation under defined benefit plans, is based on the market yield on government securities, of a maturity
period equivalent to the weighted average maturity profile of the related obligations at the Balance Sheet date.
Actuarial gains and losses are recognised immediately in the Profit and Loss Account.
In case of funded plans, the fair value of the plan assets is reduced from the gross obligation under the defined benefit plans to
recognise the obligation on the net basis.
Gains or losses on the curtailment or settlement of any defined benefit plan are recognised when the curtailment or settlement
occurs. Past service cost is recognised as expense on a straight line basis over the average period until the benefits become
vested.
c)
d)
Long term employee benefits
The obligation for long term employee benefits such as long term compensated absences, long service award, etc. is recognised in
the similar manner as in the case of defined benefit plans as mentioned in (b) (ii) above.
Termination benefits
Termination benefits such as compensation under Voluntary Retirement-cum-Pension Scheme is amortised over a defined period.
The defined period of amortisation is five years or the period till March 31, 2010, whichever is earlier.
Fixed assets
Fixed assets are stated at original cost net of tax/duty credits availed, if any, less accumulated depreciation, accumulated amortisation and
cumulative impairment. Fixed asset which were revalued as on October 1, 1984 are stated at the values determined by the valuers less
accumulated depreciation, accumulated amortisation and cumulative impairment. Assets acquired on hire purchase basis are stated at
their cash values. Specific know-how fees paid, if any, relating to plant and machinery is treated as part of cost thereof.
Administrative and other general overhead expenses that are specifically attributable to construction or acquisition of fixed assets or
bringing the fixed assets to working condition are allocated and capitalised as a part of the cost of the fixed assets.
Own manufactured assets are capitalised at cost including an appropriate share of overheads.
(Also refer to policy on leases, borrowing costs, impairment of assets and foreign currency transactions, infra)
Leases
a)
Lease transactions entered into prior to April 1, 2001:
Assets leased out are stated at original cost. Lease equalisation adjustment is the difference between capital recovery included in the
lease rentals and depreciation provided in the books of account.
Lease rentals in respect of assets acquired under leases are charged to Profit and Loss Account.
b)
Lease transactions entered into on or after April 1, 2001:
i)
ii)
Assets acquired under leases where the Company has substantially all the risks and rewards of ownership are classified as
finance leases. Such assets are capitalised at the inception of the lease at the lower of the fair value or the present value of
minimum lease payments and a liability is created for an equivalent amount. Each lease rental paid is allocated between the
liability and the interest cost, so as to obtain a constant periodic rate of interest on the outstanding liability for each period.
Assets acquired on leases where a significant portion of the risks and rewards of ownership are retained by the lessor are
classified as operating leases. Lease rentals are charged to the Profit and Loss Account on accrual basis.
iii) Assets given under a finance lease are recognised as a receivable at an amount equal to the net investment in the lease. Lease
income is recognised over the period of the lease so as to yield a constant rate of return on the net investment in the lease.
iv) Assets leased out under operating leases are capitalised. Rental income is recognised on accrual basis over the lease term.
v)
Initial direct costs relating to assets given on finance leases are charged to Profit and Loss Account.
(Also refer to policy on depreciation, infra)
6.
7.
211
Schedules forming part of the Consolidated Accounts (contd.)
8. Depreciation
a)
Indian companies
i)
Owned assets
a) Revalued assets:
Depreciation is provided for based on the straight line method on the values and at the rates given by the valuers. The
difference between depreciation provided based on revalued amount and that on historical cost is transferred from revaluation
reserve to Profit and Loss Account.
b)
Assets carried at historical cost:
Depreciation on assets carried at historical cost is provided on the written down value basis on assets acquired up to March
31, 1968 (at the rates prescribed under Schedule XIV to the Companies Act, 1956) and on the straight line basis on assets
acquired subsequently (at the rates prevailing at the time of their acquisition) on assets acquired up to September 30, 1987.
For the assets acquired thereafter, depreciation is provided at the rates prescribed under Schedule XIV to the Companies
Act, 1956 or at higher rates in line with the estimated useful lives of the assets.
c) Depreciation for additions to/deductions from owned assets is calculated pro rata from/to the month of additions/deductions.
Extra shift depreciation is provided on a location basis.
d) Depreciation charge for impaired assets is adjusted in future periods in such a manner that the revised carrying amount of
the asset is allocated over its remaining useful life.
ii)
Leased assets
a)
Lease transactions entered into prior to April 1, 2001:
Assets given on lease are depreciated over the primary period of the lease. Accordingly, while the statutory depreciation on
such assets is provided for on the straight line basis as per Schedule XIV to the Companies Act, 1956, the difference is
adjusted through lease equalisation and lease adjustment account.
b)
Lease transactions entered into on or after April 1, 2001:
Assets acquired under finance leases are depreciated on a straight line method over the lease term. Where there is reasonable
certainty that the Company shall obtain ownership of the assets at the end of the lease term, such assets are depreciated
at the rates prescribed under Schedule XIV to the Companies Act, 1956 or at the higher rates adopted by the Company for
similar assets.
b)
Foreign companies
Depreciation has been provided by the foreign companies on methods and at the rates required/permissible by the local laws so as to
write off the assets over their useful life.
9.
Intangible assets and amortisation
Intangible assets are recognised when it is probable that the future economic benefits that are attributable to the asset will flow to the
enterprise and the cost of the asset can be measured reliably. Intangible assets are amortised as follows:
Leasehold land: over the period of lease.
Specialised software: Over a period of three years.
Lump sum fees for technical know-how: Over a period of six years in case of foreign technology and three years in the case of
indigenous technology.
Trade marks over a period of five years.
Toll collection rights obtained in consideration for rendering construction services represent the right to collect toll revenue during the
concession period in respect of Build-Operate-Transfer (BOT) projects undertaken by the group. Toll collection rights are capitalised
as intangible asset upon completion of the project at the cumulative construction costs including related margins (refer accounting
policy on revenue recognition above) plus obligation towards negative grants payable to NHAI, if any. Till the completion of the project,
the same is recognised as capital work-in-progress. Toll collection rights are amortised over the period of rights given under the
concession agreement.
Administrative and other general overhead expenses that are specifically attributable to acquisition of intangible assets are allocated
and capitalised as a part of the cost of the intangible assets.
Amortisation on impaired assets is provided by adjusting the amortisation charges in the remaining periods so as to allocate the
asset's revised carrying amount over its remaining useful life.
Goodwill represents the difference between the Group's share in the net worth of a subsidiary or an associate or a joint venture, and
the cost of acquisition at each point of time of making the investment in the subsidiary or the associate or the joint venture. For this
a)
b)
c)
d)
e)
212
Schedules forming part of the Consolidated Accounts (contd.)
purpose, the Group's share of net worth is determined on the basis of the latest financial statements prior to the acquisition after
making necessary adjustments for material events between the date of such financial statements and the date of respective acquisition.
Capital reserve on consolidation represents negative goodwill arising on consolidation.
Goodwill arising out of acquisition of equity stake in a subsidiary, an associate or a joint venture is amortised in equal amounts over a
period of ten years from the date of first acquisition. In the event of cessation of operations of a subsidiary, associate or joint venture,
the unamortised goodwill is written off fully.
Exploration and evaluation expenditure incurred for potential mineral reserves is recognised and reported as part of "capital work-in-
progress" under "intangible assets" when such costs are expected to be either recouped in full through successful exploration and
development of the area of interest or alternatively, by its sale; or when exploration and evaluation activities in the area of interest have
not yet reached a stage which permits a reasonable assessment of the existence or otherwise of economically available reserves and
active and significant operations in relation to the area are continuing or are planned for the future. Exploration assets are re-assessed
on a regular basis and these costs are carried forward provided that at least one of the conditions outlined above is met. All other
exploration and evaluation expenditure is recognised as expense in the period in which it is incurred.
10.
Impairment of assets
As at each Balance Sheet date, the carrying amount of assets is tested for impairment so as to determine:
a)
b)
the provision for impairment loss, if any, required ; or
the reversal, if any, required of impairment loss recognised in previous periods.
Impairment loss is recognised when the carrying amount of an asset exceeds its recoverable amount.
Recoverable amount is determined:
a)
b)
in the case of an individual asset, at the higher of the net selling price and the value in use;
in the case of a cash generating unit (a group of assets that generates identified, independent cash flows), at the higher of the cash
generating unit's net selling price and the value in use.
(Value in use is determined as the present value of estimated future cash flows from the continuing use of an asset and from its disposal at
the end of its useful life.)
11.
Investments
Long term investments (other than associates) are carried at cost, after providing for any diminution in value, to recognise a decline "other
than temporary" in nature. Current investments are carried at lower of cost or market value. The determination of carrying amount of such
investments is done on the basis of weighted average cost of each individual investment. Investment in associate companies is accounted
using the "equity method" as stated in para 3(b) above.
12.
Inventories
Inventories are valued after providing for obsolescence, as under:
a) Raw materials, components, construction materials, stores, spares and loose tools at lower of weighted average cost or net realisable
value.
b) Work-in-progress
i) Work-in-progress (other than project and construction related) at lower of cost including related overheads or net realisable
value.
ii)
Project and construction related work-in-progress at cost till such time the outcome of the job cannot be ascertained reliably and
at realisable value thereafter.
In the case of qualifying assets, cost includes applicable borrowing costs vide policy relating to borrowing costs.
c)
Finished goods at lower of weighted average cost or net realisable value. Cost includes related overheads and excise duty paid/
payable on such goods.
d)
Property development land at lower of cost or net realisable value.
e) Completed property is valued at lower of cost or net realisable value.
13. Government grant
Grants received from National Highway Authority of India (NHAI) in the nature of "promoter contribution" are credited to "capital reserve".
213
Schedules forming part of the Consolidated Accounts (contd.)
14. Securities premium account
a)
Securities premium includes:
i)
The difference between the market value and the consideration received in respect of shares issued pursuant to Stock Appreciation
Rights Scheme.
ii)
The discount allowed, if any, in respect of shares allotted pursuant to Stock Options Scheme.
b)
The following expenses are written off against securities premium account:
i)
ii)
Expenses incurred on issue of shares.
Expenses (net of tax) incurred on issue of debentures/bonds.
iii) Premium (net of tax) on redemption of debentures/bonds.
15. Borrowing costs
Borrowing costs that are attributable to the acquisition, construction or production of a qualifying asset are capitalised as part of cost of such
asset till such time as the asset is ready for its intended use or sale. A qualifying asset is an asset that necessarily requires a substantial
period of time to get ready for its intended use or sale. All other borrowing costs are recognised as an expense in the period in which they
are incurred.
16. Employee stock ownership schemes
In respect of stock options granted pursuant to the Company's Employee Stock Options Schemes, the intrinsic value of the options (excess
of market price of the share over the exercise price of the option) is treated as discount and accounted as employee compensation cost
over the vesting period.
17. Miscellaneous expenditure
Lump sum compensation paid under Voluntary Retirement-cum-Pension Schemes are amortised over a period of five years or the period
till March 31, 2010, whichever is earlier. The future pensions under Voluntary Retirement-cum-Pension Scheme are amortised over the
period for which pensions are payable.
18. Foreign currency transactions, foreign operations, forward contracts and derivatives
a)
b)
The reporting currency of the Company is the Indian Rupee.
Foreign currency transactions are recorded on initial recognition in the reporting currency, using the exchange rate at the date of the
transaction. At each Balance Sheet date, foreign currency monetary items are reported using the closing rate. Non-monetary items
which are carried at historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.
Exchange differences that arise on settlement of monetary items or on reporting at each Balance Sheet date of the Company's
monetary items at the closing rate are:
i)
ii)
adjusted in the cost of fixed assets specifically financed by the borrowings contracted upto March 31, 2004 to which the exchange
differences relate.
adjusted in the cost of fixed assets specifically financed by borrowings contracted between the period April 1, 2004 to March 31,
2007 and to which the exchange differences relate, provided the assets are acquired from outside India.
iii)
recognised as income or expense in the period in which they arise, in cases other than (i) and (ii) above.
c)
Financial statements of foreign operations comprising jobs contracted prior to April 1, 2004, are translated as follows:
i)
ii)
Closing inventories at rates prevailing at the end of the year.
Fixed Assets as at April 1, 1991 at rates prevailing at the end of the year in which the additions were made. Subsequent additions
are at rates prevailing on the dates of the additions. Depreciation is accounted at the same rate at which the assets are translated.
iii) Other assets and liabilities at rates prevailing at the end of the year.
iv) Net revenues at the average rate for the year.
d)
Financial statements of foreign operations comprising jobs contracted on or after April 1, 2004, are treated as integral operations and
translated as in the same manner as foreign currency transactions, as described above. Exchange differences arising on such
translation are recognised as income or expense of the period in which they arise.
e)
Financial statements of overseas non-integral operations are translated as under:
i)
Assets and liabilities at the rate prevailing at the end of the year. Depreciation is accounted at the same rate at which assets are
converted.
ii)
Revenues and expenses at yearly average exchange rates prevailing during the year.
214
Schedules forming part of the Consolidated Accounts (contd.)
f)
g)
Exchange differences arising on translation of non integral foreign operations are accumulated in the foreign currency translation
reserve until the disposal of such operations.
Forward contracts, other than those entered into to hedge foreign currency risk on unexecuted firm commitments or highly probable
forecast transactions, are treated as foreign currency transactions and accounted accordingly as per Accounting Standard (AS) 11
"The Effects of Changes in Foreign Exchange Rates". Exchange differences arising on such contracts are recognised in the period in
which they arise.
Gains and losses arising on account of roll over/cancellation of forward contracts are recognised as income/expense of the period in
which such roll over/cancellation takes place.
All the other derivative contracts, including forward contracts entered into to hedge foreign currency risks on unexecuted firm commitments
and highly probable forecast transactions, are recognised in the financial statements at fair value as on the Balance Sheet date, in
pursuance of the announcement of the Institute of Chartered Accountants of India (ICAI) dated March 29, 2008 on accounting of
derivatives. The Company has adopted Accounting Standard (AS) 30 "Financial Instruments: Recognition and Measurement" for
accounting of such derivative contracts, not covered under Accounting Standard (AS) 11 "The Effects of Changes in Foreign Exchange
Rates", as mandated by the ICAI in the aforesaid announcement.
Accordingly, the resultant gains or losses on fair valuation/settlement of the derivative contracts covered under Accounting Standard
(AS) 30 "Financial Instruments: Recognition and Measurement" are recognised in the Profit and Loss Account or Balance Sheet as
the case may be after applying the test of hedge effectiveness. The gains or losses are recognised in the Balance Sheet where the
hedge is effective, while the same is recognised in the Profit and Loss Account where the hedge is ineffective. The premium paid/
received on a foreign currency forward contract is accounted as expense/income over the period of the contract.
19. Segment Accounting
a)
Segment accounting policies
Segment accounting policies are in line with the accounting policies of the Company. In addition, the following specific accounting
policies have been followed for segment reporting:
i)
ii)
Segment revenue includes sales and other income directly identifiable with/allocable to the segment including inter-segment
revenue.
Expenses that are directly identifiable with/allocable to segments are considered for determining the segment result. Expenses
which relate to the Group as a whole and not allocable to segments are included under "unallocable corporate expenditure."
iii)
Income which relates to the Group as a whole and not allocable to segments is included in "unallocable corporate income".
iv) Segment Result includes margins on inter-segment capital jobs, which are reduced in arriving at the profit before tax of the
Group.
v)
Segment assets and liabilities include those directly identifiable with the respective segments. Unallocable corporate assets and
liabilities represent the assets and liabilities that relate to the Group as a whole and not allocable to any segment. Unallocable
assets mainly comprise trade investments in associate companies. Unallocable liabilities include mainly loan funds, provisions
for employee retirement benefits and proposed dividend.
b)
Inter-segment transfer pricing
Segment revenue resulting from transactions with other business segments is accounted on the basis of transfer price agreed between
the segments. Such transfer prices are either determined to yield a desired margin or agreed on a negotiated basis.
20. Taxes on income
a)
Indian companies:
Tax on income for the current period is determined on the basis of taxable income and tax credits computed in accordance with the
provisions of the Income Tax Act, 1961, and based on the expected outcome of assessments/appeals.
Deferred tax is recognised on timing differences between the accounting income and the taxable income for the year, and quantified
using the tax rates and laws enacted or substantively enacted as on the Balance Sheet date.
Deferred tax assets relating to unabsorbed depreciation/business losses/losses under the head "capital gains" are recognised and
carried forward to the extent there is virtual certainty that sufficient future taxable income will be available against which such deferred
tax assets can be realised.
Other deferred tax assets are recognised and carried forward to the extent that there is a reasonable certainty that sufficient future
taxable income will be available against which such deferred tax assets can be realised.
215
Schedules forming part of the Consolidated Accounts (contd.)
b)
Foreign companies:
Foreign companies recognise tax liabilities and assets in accordance with the applicable local laws.
21. Fringe benefit tax
Fringe benefit tax (FBT) on the Employee Stock Options (ESOPs) is recognised in the Profit and Loss Account when the liability crystalises
upon vesting of such stock options. Wherever such FBT liability is borne by the employee, the same is not so recognised.
FBT on all other expenses, as specified in Income Tax Act, 1961, is recognised in the Profit and Loss Account when the underlying
expenses are incurred.
22. Provisions, contingent liabilities and contingent assets
Provisions are recognised for liabilities that can be measured only by using a substantial degree of estimation, if
a)
b)
c)
the Company has a present obligation as a result of a past event,
a probable outflow of resources is expected to settle the obligation and
the amount of the obligation can be reliably estimated.
Reimbursement expected in respect of expenditure required to settle a provision is recognised only when it is virtually certain that the
reimbursement will be received.
Contingent liability is disclosed in case of:
a)
b)
c)
a present obligation arising from past events, when it is not probable that an outflow of resources will be required to settle the
obligation
a present obligation when no reliable estimate is possible;
a possible obligation arising from past events where the probability of outflow of resources is not remote.
Contingent assets are neither recognised, nor disclosed.
Provisions, contingent liabilities and contingent assets are reviewed at each Balance Sheet date.
216
Notes forming part of the Consolidated Accounts
1.
Basis of preparation
a)
The Consolidated Financial Statements (CFS) are prepared in accordance with Accounting Standard (AS) 21 "Consolidated Financial
Statements", Accounting Standard (AS) 23 "Accounting for Investments in Associates in Consolidated Financial Statements" and
Accounting Standard (AS) 27 "Financial Reporting of Interests in Joint Ventures", as specified in the Companies (Accounting Standards)
Rules, 2006. The CFS comprises the financial statements of Larsen & Toubro Limited (L&T), its subsidiaries, associates and joint
ventures. Reference in these notes to L&T, Company, Parent Company, Companies or Group shall mean to include Larsen & Toubro
Limited or any of its subsidiaries, associates and joint ventures, unless otherwise stated.
b)
The notes and significant policies to the CFS are intended to serve as a guide for better understanding of the Group's position. In this
respect, the Company has disclosed such notes and policies which represent the required disclosure.
2.
The list of subsidiaries, associates and joint ventures included in the consolidated financial statements are as under:-
As at 31-3-2009
As at 31-3-2008
Sr. Name of subsidiary company
no.
Country of
incorporation
Indian subsidiaries
Tractor Engineers Limited
Bhilai Power Supply Company Limited
L&T-Sargent & Lundy Limited
Spectrum Infotech Private Limited
L&T Infrastructure Finance Company Limited
International Seaport Dredging Limited*
L&T-Valdel Engineering Limited
India Infrastructure Developers Limited
L&T Shipbuilding Limited
L&T Infra & Property Development Private Limited
L&T Concrete Private Limited
L&T Strategic Management Limited
L&T Transco Private Limited
L&T Chennai - Tada Tollway Limited
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15 HI-Tech Rock Products & Aggregates Limited
16
17
18
19
20
21
22
L&T Seawoods Private Limited
L&T Realty Private Limited
L&T-Gulf Private Limited
L&T Power Limited (formerly known as
L&T Power Projects Limited)
L&T-MHI Boilers Private Limited
L&T-MHI Turbine Generators Private Limited
Larsen & Toubro Infotech Limited
23 GDA Technologies Limited
24 GDA Systems Private Limited @
25
26
27
28
L&T Finance Limited
L&T Capital Company Limited
L&T General Insurance Company Limited
L&T Power Development Limited
29 Raykal Aluminium Company Private Limited
30
L&T Uttaranchal Hydropower Limited
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
Proportion of Proportion of Proportion of Proportion of
ownership voting power
held (%)
interest (%)
voting power
held (%)
ownership
interest (%)
100.00
99.90
100.00
99.90
100.00
99.90
100.00
99.90
50.00009
50.00009
50.00009
50.00009
100.00
100.00
99.99
46.02
95.00
99.99
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
99.99
46.02
95.00
99.99
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
51.00
95.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
51.00
95.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
50.0002
50.0002
50.0002
50.0002
100.00
51.00
51.00
100.00
100.00
–
99.99
100.00
100.00
100.00
80.00
100.00
100.00
51.00
51.00
100.00
100.00
–
99.99
100.00
100.00
100.00
80.00
100.00
100.00
51.00
51.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
80.00
100.00
100.00
51.00
51.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
80.00
100.00
217
Notes forming part of the Consolidated Accounts (contd.)
As at 31-3-2009
As at 31-3-2008
Sr. Name of subsidiary company
no.
Country of
incorporation
Indian subsidiaries (contd.)
31
32
L&T Infrastructure Development Projects Limited
L&T Panipat Elevated Corridor Limited
33 Narmada Infrastructure Construction Enterprise Limited
34
35
36
37
38
39
40
41
42
43
L&T Krishnagiri Thopur Toll Road Limited
L&T Western Andhra Tollways Limited
L&T Vadodara Bharuch Tollway Limited
L&T Transportation Infrastructure Limited
L&T Western India Tollbridge Limited
L&T Interstate Road Corridor Limited
International Seaports (India) Private Limited
L&T Urban Infrastructure Limited
L&T South City Projects Limited
L&T Siruseri Property Developers Limited
44 Cyber Park Development & Construction Limited
45
46
47
48
L&T Vision Ventures Limited
L&T Tech Park Limited
L&T Phoenix Infoparks Private Limited
L&T Bangalore Airport Hotel Limited
49 CSJ Infrastructure Private Limited
50
51
52
53
L&T Arun Excello Commercial Projects Private Limited
L&T Arun Excello IT SEZ Private Limited
L&T Infocity Limited
L&T Hitech City Limited
54 Hyderabad International Trade Expositions Limited
55 Andhra Pradesh Expositions Private Limited
56
57
L&T Capital Holdings Limited
L&T Port Sutrapada Limited
58 Sutrapada SEZ Developers Limited
59 Sutrapada Shipyard Limited
60
L&T PNG Tollway Private Limited
61 Chennai Vision Developers Private Limited
62
63
64
65
66
67
L&T Ahmedabad-Maliya Tollway Private Limited
L&T Halol-Shamlaji Tollway Private Limited
L&T Rajkot-Vadinar Tollway Private Limited
L&T Engserve Private Limited
L&T Natural Resources Limited
L&T-Demag Plastics Machinery Limited #
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
India
Proportion of Proportion of Proportion of Proportion of
ownership voting power
held (%)
interest (%)
voting power
held (%)
ownership
interest (%)
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
59.74
30.47
30.47
30.47
40.62
30.47
30.47
44.21
41.82
30.47
30.47
53.17
39.34
30.90
30.90
99.99
100.00
100.00
100.00
74.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
59.74
30.47
30.47
30.47
40.62
30.47
30.47
44.21
41.82
30.47
30.47
53.17
39.34
30.90
30.90
99.99
100.00
100.00
100.00
74.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
59.74
30.47
30.47
30.47
40.62
30.47
30.47
44.21
41.82
30.47
30.47
53.17
39.34
28.55
28.55
–
–
–
–
–
–
–
–
–
–
–
–
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
79.65
59.74
30.47
30.47
30.47
40.62
30.47
30.47
44.21
41.82
30.47
30.47
53.17
39.34
28.55
28.55
–
–
–
–
–
–
–
–
–
–
–
–
* The Parent Company controls the composition of board of directors.
@ The Company was merged with GDA Technologies Limited w.e.f. April 1, 2008.
# Till March 30, 2009, the Company was a jointly controlled entity (Indian joint venture).
218
Notes forming part of the Consolidated Accounts (contd.)
As at 31-3-2009
As at 31-3-2008
Proportion of Proportion of Proportion of Proportion of
ownership voting power
held (%)
interest (%)
voting power
held (%)
ownership
interest (%)
Sr. Name of subsidiary company
no.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
Foreign subsidiaries
Larsen & Toubro LLC
L&T Realty FZE
Larsen & Toubro Infotech, GmbH
Larsen & Toubro Infotech Canada Limited
(formerly known as Larsen & Toubro
Information Technology Canada Limited)
GDA Technologies Inc.
International Seaports Pte Limited**
Larsen & Toubro International FZE
Larsen & Toubro (Oman) LLC
Larsen & Toubro Electromech LLC
L&T Modular Fabrication Yard LLC
Larsen & Toubro (East Asia) SDN.BHD ##
(formerly known as L&T-ECC Construction (M)
SDN. BHD.)
Larsen & Toubro Qatar LLC ##
L&T Overseas Projects Nigeria Limited
L&T Electricals Saudi Arabia Company
Limited, LLC
Larsen & Toubro Kuwait Construction
General Contracting Company, WLL ##
Larsen & Toubro (Qingdao) Rubber
Machinery Company Limited
17 Qingdao Larsen & Toubro Trading Company
18
19
20
21
Limited
Larsen & Toubro (Jiangsu) Valve Company
Limited
Larsen & Toubro Readymix Concrete
Industries LLC ##
Larsen & Toubro Saudi Arabia LLC
Larsen & Toubro (Wuxi) Electric Company
Limited
Larsen & Toubro ATCO Saudia LLC ##
22
23 Offshore International FZC
24
L&T Infrastructure Development Projects
Lanka (Private) Limited
L&T Infocity Lanka Private Limited
L&T Electrical & Automation FZE
25
26
27 Tamco Switchgear (Malaysia) SDN BHD
28 Tamco Shanghai Switchgear Co. Ltd.
29 Tamco Electrical Industries Australia Pty Ltd.
30 PT Tamco Indonesia
31
Larsen & Toubro Heavy Engineering LLC
Country of
incorporation
USA
UAE
Germany
Canada
USA
Singapore
UAE
Sultanate of Oman
Sultanate of Oman
Sultanate of Oman
Malaysia
Qatar
Nigeria
Saudi Arabia
Kuwait
China
China
China
UAE
Saudi Arabia
China
Saudi Arabia
UAE
Sri Lanka
Sri Lanka
UAE
Malaysia
China
Australia
Indonesia
Sultanate of Oman
100.00
100.00
100.00
100.00
100.00
100.00
100.00
65.00
65.00
65.00
30.00
49.00
100.00
75.00
49.00
95.00
95.00
69.70
49.00
100.00
100.00
49.00
60.00
75.67
27.65
100.00
100.00
100.00
100.00
99.00
70.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
65.00
65.00
65.00
100.00
100.00
100.00
75.00
75.00
95.00
95.00
69.70
75.00
100.00
100.00
75.00
60.00
75.67
27.65
100.00
100.00
100.00
100.00
100.00
70.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
65.00
65.00
65.00
30.00
49.00
100.00
75.00
49.00
95.00
95.00
69.70
49.00
100.00
100.00
49.00
60.00
75.67
27.65
–
–
–
–
–
–
** The Company is under liquidation.
## The Parent Company, together with its subsidiaries controls the composition of board of directors.
100.00
100.00
100.00
100.00
100.00
100.00
100.00
65.00
65.00
65.00
100.00
100.00
100.00
75.00
75.00
95.00
95.00
69.70
75.00
100.00
100.00
75.00
60.00
75.67
27.65
–
–
–
–
–
–
219
Notes forming part of the Consolidated Accounts (contd.)
As at 31-3-2009
As at 31-3-2008
Country of
incorporation
India
India
India
India
India
Sr. Name of associate company
no.
1
2
3
4
5
6
7
8
9
L&T-Komatsu Limited
Audco India Limited
EWAC Alloys Limited
L&T-Case Equipment Private Limited
Voith Paper Technology (India) Limited
International Seaport (Haldia) Private Limited India
L&T-Chiyoda Limited
L&T-Ramboll Consulting Engineers Limited
L&T-Crossroads Private Limited
10 NAC Infrastructure Equipment Limited
11 Second Vivekananda Bridge Tollway
Company Private Limited
12 Gujarat Leather Industries Limited**
13 Ennore Tank Terminals Private Limited
14 Vizag IT Park Limited
India
India
India
India
India
India
India
India
15
Larsen & Toubro Qatar & HBK Contracting LLC*** Qatar
16 TNJ Moduletech Private Limited
17
18
L&T Camp Facilities LLC
L&T Arun Excello Realty Private Limited
19 Feedback Ventures Limited
20 Salzer Cables Limited
21
JSK Electricals Private Limited
India
UAE
India
India
India
India
Proportion of Proportion of Proportion of Proportion of
ownership voting power
held (%)
interest (%)
voting power
held (%)
ownership
interest (%)
50.00
50.00
50.00
50.00
50.00
17.77
50.00
50.00
29.87
31.03
26.55
50.00
20.71
13.82
24.50
40.00
49.00
19.71
26.00
48.21
26.00
50.00
50.00
50.00
50.00
50.00
17.77
50.00
50.00
29.87
31.03
26.55
50.00
20.71
13.82
24.50
40.00
49.00
19.71
26.00
48.21
26.00
50.00
50.00
50.00
50.00
50.00
17.77
50.00
50.00
29.87
31.03
26.55
50.00
20.71
13.82
24.50
40.00
49.00
19.71
26.00
48.21
–
50.00
50.00
50.00
50.00
50.00
17.77
50.00
50.00
29.87
31.03
26.55
50.00
20.71
13.82
24.50
40.00
49.00
19.71
26.00
48.21
–
** The Company is under liquidation.
*** Accounts have been consolidated for 15 months period ended March 31, 2009.
Sr. Name of joint venture
no.
Jointly controlled entities - Indian joint ventures
L&T-AM Tapovan Joint Venture
International Metro Civil Contractors
Desbuild-L&T Joint Venture
HCC-L&T Purulia Joint Venture
Bauer-L&T Diaphragm Wall Joint Venture
Metro Tunneling Group
L&T-Hochtief Seabird Joint Venture
L&T-Shanghai Urban Corporation Group Joint Venture
The Dhamra Port Company Limited
1
2
3
4
5
6
7
8
9
10
L&T Bombay Developers Private Limited
220
As at 31-3-2009 As at 31-3-2008
Proportion of Proportion of
ownership
interest(%)
ownership
interest (%)
Country of
residence
India
India
India
India
India
India
India
India
India
India
65.00
26.00
49.00
43.00
50.00
26.00
90.00
51.00
39.83
29.87
65.00
26.00
49.00
43.00
50.00
26.00
90.00
51.00
39.83
29.87
Notes forming part of the Consolidated Accounts (contd.)
Sr. Name of joint venture (Contd.)
no.
11
12
13
Jointly controlled entities - foreign joint ventures
L&T-Eastern Joint Venture
Larsen & Toubro Limited - Shapoorji Pallonji & Company Limited Joint Venture
(Les Pailles Exhibition Centre, Mauritius)
Larsen & Toubro Limited - Shapoorji Pallonji & Company Limited Joint Venture
(Ebene Cybercity Project, Mauritius)
Jointly controlled operations - indian joint ventures
L&T-HCC Joint Venture
L&T-KBL (UJV) Hyderabad
14
15 Patel-L&T Consortium
16 Consortium of Samsung Heavy Industries Co. Ltd., Korea and L&T
17 Consortium of Global Industries Offshore LLC, USA and L&T
18
19 Consortium of Toyo Engineering Company and L&T
20
21
22
L&T-SVEC Joint Venture
L&T-KBL - MAYTAS UJV
L&T and Scomi Engineering BHD. Joint Venture
Jointly controlled operations - foreign joint venture
Lurgi L&T KQKS Consortium
23
As at 31-3-2009 As at 31-3-2008
Proportion of Proportion of
ownership
interest(%)
ownership
interest (%)
65.00
50.00
50.00
65.00
50.00
50.00
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Country of
residence
UAE
Mauritius
Mauritius
India
India
India
India
India
India
India
India
India
Malaysia
3. During the year ended March 31, 2009, an amount of Rs.44.28 crore was amortised from goodwill arising on acquisition of subsidiary and
associate companies. (previous year: Rs.23.10 crore)
4.
a) Reserves shown in the consolidated Balance Sheet represent the Group's share in the respective reserves of subsidiaries and
proportionate reserves of joint ventures. Reserve attributable to minority stakeholders is reported as part of minority interest in the
consolidated Balance Sheet. Retained earnings comprise Group's share in general reserve and Profit and Loss Account.
b) During the year ended March 31, 2009, preliminary expenses of Rs.25.41 crore pertaining to earlier years were written off to Profit and
Loss Account.
c) During the year ended March 31, 2009, the Company has adopted the policy of recognising interest income in respect of annuity
projects (undertaken on BOT basis) as "income from annuity based project" based on the implicit rate of return embedded in the
committed cash flows under the concession agreement. Accordingly, the borrowing cost incurred in respect of such projects is recognised
as an expense in the year in which it is incurred. As a result, the profit before tax for the year is higher by Rs.63.09 crore (net of interest
expense of Rs.18.18 crore).
5.
The effect of acquisition/disposal of stake in subsidiaries during the year on the consolidated financial statements is as under:
Name of subsidiary companies
a) Acquisitions:
L&T Capital Holdings Limited
L&T PNG Tollway Private Limited
Chennai Vision Developers Limited
L&T Ahmedabad-Maliya Tollway Private Limited
L&T Halol-Shamlaji Tollway Private Limited
L&T Rajkot-Vadinar Tollway Private Limited
L&T Engserve Private Limited
L&T Natural Resources Limited
Carried forward
Effect on Group
profit/(loss) after
minority interest
Rs.crore
Net assets
as at
31-3- 2009
(0.02)
(0.05)
–
(0.05)
(0.06)
(0.05)
–
(1.76)
(1.99)
1078.58
(0.05)
0.01
0.96
0.96
0.96
0.01
(1.71)
1079.72
221
Notes forming part of the Consolidated Accounts (contd.)
Name of subsidiary companies
Acquisitions: (contd.)
Brought forward
L&T Electrical & Automation FZE
Larsen & Toubro Heavy Engineering LLC
Tamco Switchgear (Malaysia) SDN BHD
Tamco Shanghai Switchgear Co., Ltd.
Tamco Electrical Industries Australia Pty Ltd.
PT Tamco Indonesia
L&T-Demag Plastics Machinery Limited
Sutrapada SEZ Developers Limited
Sutrapada Shipyard Limited
L&T Port Sutrapada Limited
Total
b) Disposals:
L&T Infocity Infrastructure Limited
Total
Effect on Group
profit/(loss) after
minority Interest
Rs.crore
Net assets
as at
31-3-2009
(1.99)
7.68
(4.17)
43.31
(0.96)
(5.48)
(8.45)
(3.24)
–
–
(0.07)
26.63
0.34
0.34
1079.72
9.85
49.23
330.08
65.22
15.55
(15.47)
5.00
0.05
0.05
3.43
1542.71
10.35
10.35
6.
a) Of the equity shares of Rs.2 each comprised in the subscribed and paid-up capital of the Company:
i)
ii)
9,19,943 (previous year: 9,19,943) equity shares were allotted as fully paid up, pursuant to contracts, without payment being
received in cash.
44,96,76,280 (previous year: 15,70,84,226) equity shares were issued as bonus shares by way of capitalisation of general
reserve: Rs.2.35 crore (previous year: Rs.2.35 crore), securities premium: Rs.87.47 crore (previous year: Rs.28.97 crore) and
capital redemption reserve: Rs.0.12 crore (previous year: Rs.0.10 crore).
iii)
1,48,67,485 (previous year: 1,40,99,067) equity shares were allotted as fully paid up on exercise of grants under Employees
Stock Ownership Schemes.
b) Options outstanding as at the end of the year on un-issued share capital:
Particulars
Employee stock options granted and outstanding#
Number of equity shares
to be issued as fully paid
As at 31-3-2009
As at 31-3-2008
2,12,89,375
90,58,363
# The number of options have been adjusted consequent to bonus issue wherever applicable.
c)
The Directors recommend payment of final dividend of Rs.10.50 per equity share of Rs.2 each on the number of shares outstanding
as on the record date. Provision for final dividend has been made in the books of account for 58,56,87,862 shares outstanding as at
March 31, 2009 amounting to Rs.614.97 crore.
7.
Stock Ownership Schemes of Parent Company:
a)
The grant of options to the employees under the Stock Option Schemes is on the basis of their performance and other eligibility
criteria. The options are vested equally over a period of four years [5 years in the case of Series 2006(A)], subject to the discretion of
the management and fulfilment of certain conditions.
222
Notes forming part of the Consolidated Accounts (contd.)
b)
The details of the grants under the aforesaid Schemes under various series are summarised below:
Sr. Series reference
no.
1 Grant price (prior to
bonus issue)- Rupees
Grant price (post
bonus issue)- Rupees
2000
2002 (A)
2002 (B)
2003 (A)
2003(B)
2006
2006(A)
2008-2009
2007-2008
2008-2009
2007-2008
2008-2009
2007-2008
2008-2009
2007-2008
2008-2009
2007-2008
2008-2009
2007-2008
2008-2009
2007-2008
7
3.50
7
–
7
3.50
7
–
7
3.50
7
–
35
17.50
35
–
35
17.50
35
–
1202
1202
1202
1202
601
–
601
2
3
Grant dates
1-6-2000
19-4-2002
19-4-2002
Vesting commences on
1-6-2001
19-4-2003
19-4-2003
23-5-2003
onwards
23-5-2004
onwards
23-5-2003
onwards
23-5-2004
onwards
1-9-2006
onwards
1-9-2007
onwards
1-7-2007
onwards
1-7-2008
onwards
4 Options granted and outstanding
at the beginning of the year
5 Options lapsed/withdrawn
prior to bonus issue
6 Options granted prior to
bonus issue
7 Options exercised prior to
bonus issue for which
shares are allotted
8 Options outstanding as on
October 3, 2008 prior to
bonus issue
9
Adjusted options as on
October 3, 2008 consequent
to bonus issue
10 Options lapsed/withdrawn
post bonus issue
11 Options granted post bonus issue
12 Options exercised post bonus
issue for which shares are allotted
13 Options exercised & allocated
against shares earlier allotted*
8400
8400
10750
10750
19850
19850
15726
33216
971468
1299885
7036899
10671500
995270
–
–
–
8400
16800
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
10750
21500
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
19850
39700
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
15726
31452
–
–
–
–
–
–
–
–
–
40481
340000
118874
1152113
2304226
–
–
–
–
–
163605
59600
120756
6812138
13624276
–
–
–
–
–
1276
50912
116041
261900
3109350
–
153800
162390
–
634670
9214
447226
331766
37516
1159921
180428
1910970
25034
2700778
5401556
133664
646295
19012
7000
–
43000
-
–
–
14 Options granted and outstanding
16800
8400
21500
10750
39700
19850
31452
15726
1959888
971468
13324860
7036899
5895175
995270
at the end of the year
of which -
Options vested
Options yet to vest
16800
8400
21500
10750
39700
19850
31452
15726
226326
34666
5321810
747179
279136
–
–
–
–
–
–
–
–
–
1733562
936802
8003050
6289720
5616039
995270
*Allocated from the shares returned by former nominee directors in accordance with the consent terms approved by the Hon'ble High Court of Bombay on June 14, 2007.
c) During the year, the Company has recovered Rs.4.80 crore (previous year: Rs.2.60 crore) from its subsidiary companies towards the
stock options granted to employees of the subsidiary companies, pursuant to the Employee Stock Option Schemes.
223
–
–
–
–
–
–
–
–
995270
–
–
Notes forming part of the Consolidated Accounts (contd.)
8.
Stock Ownership Schemes of subsidiary companies:
a)
Employee Stock Ownership Scheme (ESOS)
Under the Employee Stock Ownership Scheme (ESOS), 25,31,159 options are outstanding as at March 31, 2009. The grant of
options to the employees under ESOS is on the basis of their performance and other eligibility criteria. Each option entitles the holder
to exercise the right to apply for and seek allotment of one equity share of Rs.5 each.
All vested options can be exercised on the first exercise date as may be determined by the Compensation Committee prior to date of
IPO. The details of the grants under the aforesaid scheme are summarised below:-
ESOP series
I, II & III
IV - XVI
XVII-XVIII
2008-2009
2007-2008 2008-2009 2007-2008 2008-2009 2007-2008
1 Grant price (Rupees)
25
10
2 Options granted and outstanding at the beginning of the year
391653
391653
2102770
2002433
10
–
3 Options granted during the year
4 Options cancelled/lapsed during the year
5 Options exercised and shares allotted during the year
6 Options granted and outstanding at the end of the year of which -
Options vested
Options yet to vest
–
124450
61250
–
–
–
–
–
–
24514
24113
–
–
391653
391653
–
391653
2078256
2102770
391653
–
970917
1107339
970917
1131853
–
–
61250
–
61250
–
–
–
–
–
–
–
b)
Employees Stock Ownership Scheme - 2006 U.S. Stock Option Sub-Plan (Sub-Plan)
The Company had instituted the Employees Stock Ownership Scheme - 2006 U.S. Stock Option Sub-Plan for the employees and
directors of its subsidiary in USA. The grant of options to the employees under this Sub-Plan is on the basis of their performance and
other eligibility criteria. The term of option shall be 5 years from the date of grant. The options are vested over a period of five years,
subject to fulfilment of certain conditions specified in the respective option agreement. Each option entitles the holder to exercise the
right to apply for and seek allotment of one equity share of Rs.5 each at an exercise price of USD 12 (equivalent to Rs.530) per share.
Under the said plan, options granted and outstanding as at the end of the year are 1,36,500, of which, 50,211 options have been
vested while 86,289 options remain unvested.
c)
Employees Stock Options granted and outstanding as at the end of the year on unissued share capital represent options 26,67,659
(previous year: 26,30,923).
9.
Loans and advances include:
i)
ii)
rent deposit with whole-time directors: Rs.0.03 crore (previous year: Rs.0.06 crore). The maximum amount outstanding at any time
during the year Rs.0.06 crore (previous year: Rs.0.07 crore).
amount, including interest accrued, due from the managing director and whole-time directors in respect of housing loan: Rs.0.63 crore
(previous year: Rs.0.73 crore). Maximum amount outstanding at any time during the year: Rs.0.73 crore (previous year: Rs.0.76 crore).
10. Sundry creditors-others include:
a. Rs.1.13 crore (previous year: Rs.17.67 crore), being contribution received from the employees of the Company and some of its
subsidiary & associate companies, on behalf of L&T Employees Welfare Foundation Trust and held on account for it.
b.
Advance of Rs.11.77 crore received from M/s. JRE Tank Terminals Private Limited under an agreement dated August 24, 2007
towards sale of 1,17,65,000 equity shares of Rs.10 each in M/s. Ennore Tank Terrminals Private Limited to be transferred as follows :
i.
ii.
Maximum 15% of shares upon completion of construction of the terminal and
Balance shares upon completion of 3 calendar years from the date of commencement of commercial operations.
224
Notes forming part of the Consolidated Accounts (contd.)
c.
d.
Down payment of Rs.3.19 crore for sale of the Company's entire investment in International Seaports (Haldia) Private Limited (ISPH)
of 98,30,000 equity shares of Rs.10 each, to Energy Investment Limited, UAE and International Lighterage Limited, Mauritius vide
agreements for share sale dated December 30, 2008. Certain conditions precedent to agreement for share sale remains to be fulfilled.
The sale will, therefore, recognised in the year in which all such conditions are satisfied.
Advance of Rs.7.16 crore received from M/s Sical Logistics Limited under an agreement for share sale and purchase dated December
17, 2008 with M/s Sical Logistics Limited for sale of the Company's stake in M/s Sical Iron Ore Terminals Limited. Accordingly,
71,50,000 equity shares of Rs.10 each held by the Company and further shares, if any, subscribed to by the Company will be sold at
cost. The sale will be subject to completion of 3 years from the date of commencement of commercial operations of Sical Iron Ore
Terminals Private Limited under the license agreement dated September 23, 2006 with Ennore Port Limited.
11. a)
Fixed deposits with scheduled banks as on March 31, 2009 include Rs.40.41 crore (previous year: Rs.40.41 crore) in respect of a
claim against the Company. The dispute is since resolved in favour of the Company, and the money has been realised on May 6, 2009.
b)
Balance with non scheduled banks include an amount of Rs.0.69 crore (previous year: Rs.0.69 crore), which is subject to an escrow
arrangement duly approved by the Reserve Bank of India, whereby the proceeds of the deposit, together with interest thereon, would
be applied towards full and final settlement of loan taken from Rafidian Bank, Iraq, which is included under unsecured loans. Once the
UN embargo against Iraq is lifted, the settlement would be effected.
12. Sales and service include Rs.117.72 crore (previous year: Rs.75.10 crore) for price variations net of liquidated damages in terms of
contracts with the customers and shipbuilding subsidy Rs.25.49 crore (previous year: Rs.29.29 crore).
13. Extraordinary items during the year comprise the following:
i.
ii.
Gain of Rs.958.74 crore (net of tax of Rs.282.08 crore) on sale of the Company's Ready Mix Concrete business.
Provision of Rs.186.28 crore in respect of investment in Satyam Computer Services Limited (SCSL) held by the Company. This
provision has been made by the Company as a measure of abundant caution. Considering the extraordinary circumstances under
which the price of SCSL shares fell in the market, the aforesaid provision has been created based on the principles of "prudence".
(Refer note no.21)
14. Disclosures pursuant to Accounting Standard (AS) 7 (Revised) "Construction Contracts":
i) Contract revenue recognised for the financial year
Particulars
ii) Aggregate amount of contract costs incurred and recognised profits (less recognised
losses) as at end of financial year for all contracts in progress as at that date
iii) Amount of customer advances outstanding for contracts in progress as at end of financial year
iv) Retention amounts due from customers for contracts in progress as at end of financial year
Rs.crore
2008-2009
2007-2008
29824.12
20030.30
48760.65
35393.02
4610.60
2136.09
3275.72
1533.88
15. a) Other income for the year ended March 31, 2009 includes a gain of Rs.16.59 crore (net) (previous year: Rs.34.31 crore) recognised
on divestment/dilution of the group's stake in four (previous year one) of its subsidiaries.
b)
An amount of Rs.323.49 crore (net loss) (previous year: Rs.270.23 crore [net loss]) has been accounted under respective revenue
heads in the Profit and Loss Account towards exchange differences arising on foreign currency transactions and forward contracts
covered under Accounting Standard (AS) 11 “The Effects of Changes in Foreign Exchange Rates”.
16. Advances recoverable in cash or in kind includes Rs.161.00 crore (previous year: Rs.200.00 crore) towards interest free loan to L&T
Employees Welfare Foundation Trust to part-finance its acquisition of equity shares in the company held by Grasim Industries Limited and
its subsidiary. The loan is repayable in 9 years commencing from May 2005 with a minimum repayment of Rs.25.00 crore in a year.
17. Segment reporting:
a)
Information about business segments (information provided in respect of revenue items for the year ended March 31, 2009 and in
respect of assets/liabilities as at March 31, 2009 - denoted as "CY" below, previous year denoted as "PY").
225
Revenue-including excise duty
External
Inter-segment
Total revenue
Result
Segment result
Less: Inter-segment margin
on capital jobs
Unallocated corporate income/
(expenditure) (net)
Operating Profit (PBIT)
Interest expense
Interest income
Profit before tax (PBT)
Provision for current tax
Provision for deferred tax
Provision for fringe benefit tax
Profit after tax
(before extraordinary items)
Profit from extraordinary items
Profit after tax
(after extraordinary items)
Depreciation (including obsolescence
amortisation and impairment)
included in segment expense
Non-cash expenses other
than depreciation included in
segment expense
Notes forming part of the Consolidated Accounts (contd.)
i)
Primary segments (business segments):
Particulars
Engineering
Electrical
& Construction & Electronics
Machinery
& Industrial
Products
Financial
Services
Developmental
Projects
Others
Elimination
Total
CY
PY
CY
PY
CY
PY
CY
PY
CY
PY
CY
PY
CY
PY
CY
PY
Rs.crore
30537.94
20679.14
3231.29
2496.92
2663.27
2653.59
1031.52
642.64
530.55
294.28
2906.17
3052.89
–
–
40900.74
29819.46
975.13
403.10
149.39
170.56
41.89
33.00
94.49
115.58
14.83
10.51
80.45
128.94 (1356.18)
(861.69)
–
–
31513.07
21082.24
3380.68
2667.48
2705.16
2686.59
1126.01
758.22
545.38
304.79
2986.62
3181.83 (1356.18)
(861.69)
40900.74
29819.46
3442.81
2064.19
352.95
398.21
451.86
422.73
228.07
246.87
108.35
158.91
354.07
387.41
–
–
4938.11
3678.32
126.20
53.20
4811.91
3625.12
(125.63)
(116.95)
4686.28
3508.17
(461.96)
(203.11)
136.01
113.56
4360.33
3418.62
1328.35
1039.27
35.36
61.16
31.74
76.11
2935.46
2271.50
772.46
–
3707.92
2271.50
–
–
–
45805.94
31350.98
11007.05
8740.29
56812.99
40091.27
–
25757.98
18753.81
16008.73
9583.73
41766.71
28337.54
Segment assets
22777.57
15658.81
2585.69
1631.26
1494.06
1353.96
7717.40
6746.90
9497.42
4335.00
1733.80
1625.05
Unallocable corporate assets
Total assets
Segment liabilities
14729.40
10748.48
784.13
621.71
789.84
710.14
6389.37
5687.78
2548.00
738.48
517.24
247.22
Unallocable corporate liabilities
Total liabilities
Capital expenditure
2698.35
1490.14
354.32
209.88
363.78
205.86
60.80
24.62
97.24
21.83
113.47
152.37
97.71
4424.32
537.47
171.90
188.60
16.19
58.61
79.37
87.28
66.24
79.49
83.60
139.43
61.76
13.90
6.19
10.58
8.48
0.76
0.80
–
–
8.35
8.66
Particulars
Domestic
Overseas
Total
CY
PY
CY
PY
CY
PY
Rs.crore
External Revenue by location of customers
28857.21 22296.14 12043.53 7523.32 40900.74 29819.46
Carrying amount of Segment Assets by location of assets
39296.19 27609.34 6509.75 3741.64 45805.94 31350.98
Cost incurred on acquisition of tangible and intangible fixed assets
7352.33 2198.43
546.17
438.84 7898.50 2637.27
226
Notes forming part of the Consolidated Accounts (contd.)
b)
Segment reporting: segment identification, reportable segments and definition of each reportable segment:
i)
ii)
Primary/secondary segment reporting format:
a)
The risk-return profile of the Company's business is determined predominantly by the nature of its products and services.
Accordingly, the business segments constitute the primary segments for disclosure of segment information.
b)
In respect of secondary segment information, the Company has identified its geographical segments as (i) domestic and (ii)
overseas. The secondary segment information has been disclosed accordingly.
Segment identification:
Business segments have been identified on the basis of the nature of products/services, the risk-return profile of individual
businesses, the organisational structure and the internal reporting system of the Company.
iii) Reportable segments:
Reportable segments have been identified as per the criteria specified in Accounting Standard (AS) 17 "Segment Reporting" as
specified in the Companies (Accounting Standards) Rules, 2006.
iv) Segment composition:
Engineering & Construction Segment comprises execution of engineering and construction projects to provide solutions
in civil, mechanical, electrical and instrumentation engineering (on turnkey basis or otherwise) to core/infrastructure sectors
including railways, shipbuilding and supply of complex plant and equipment to core sectors. The segment capabilities
include basic/detailed engineering, equipment fabrication/supply, erection & commissioning, procurement/construction and
project management.
Electrical & Electronics Segment comprises manufacture and/or sale of low & medium voltage switchgear and control
gear, custom-built switchboards, petroleum dispensing pumps & systems, electronic energy meters/protection (relays)
systems, control & automation products and medical equipment.
Machinery & Industrial Products Segment comprises manufacture and sale of industrial machinery & equipment,
manufacturing & sale of industrial valves, construction equipment and welding/industrial products, manufacture and sale of
undercarriage assemblies.
Financial Services Segment comprises corporate finance, equipment finance, infrastructure financing and related advisory
services.
Developmental Projects comprises development, operation and maintenance of basic infrastructure projects, toll collection,
development of urban infrastructure and providing related advisory services.
Others include ready mix concrete, e-engineering services and embedded systems, power development, information
technology services and mining.
18. Disclosure of related parties/related party transactions:
i.
Names of the related parties with whom transactions were carried out during the year and description of relationship:
Associate companies:
1
3
5
7
9
11
13
15
17
19
Audco India Limited
L&T-Chiyoda Limited
L&T-Ramboll Consulting Engineers Limited
Voith Paper Technology (India) Limited
2
4
6
8
EWAC Alloys Limited
L&T-Komatsu Limited
L&T-Case Equipment Private Limited
Salzer Cables Limited
International Seaport (Haldia) Private Limited
10 Second Vivekananda Bridge Tollway Company Private Limited
L&T Arun Excello Realty Private Limited
12
L&T Camp Facilities LLC
L&T-Crossroads Private Limited
14 NAC Infrastructure Equipment Limited
TNJ Moduletech Private Limited
16 Vizag IT Park Limited
Feedback Ventures Limited
18
JSK Electricals Private Limited
Ennore Tank Terminals Private Limited
227
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
(cid:129)
Notes forming part of the Consolidated Accounts (contd.)
Joint ventures (other than associates):
1
3
5
7
9
11
International Metro Civil Contractors Joint Venture
The Dhamra Port Company Limited
Metro Tunnelling Group
Larsen & Toubro Limited-Shapoorji Pallonji & Company Limited
Joint Venture (Les Palles Exhibition Centre)
Desbuild-L&T Joint Venture
L&T-AM Tapovan Joint Venture
Key management personnel & their relatives:
Mr. A. M. Naik, (Chairman & Managing director)
Mr. Y. M. Deosthalee (whole-time director)
Mrs. Leena Y. Deosthalee (wife)
Mr. R. N. Mukhija (whole-time director)
Mrs. Sushma Mukhija (wife)
Ms. Debika Ajmani (daughter)
1
3
5
7
2
4
6
8
10
12
2
4
6
Bauer-L&T Diaphragm Wall Joint Venture
L&T - Eastern Joint Venture
L&T Hochtief Seabird Joint Venture
Larsen & Toubro Limited-Shapoorji Pallonji & Company Limited
Joint Venture (Ebene Cybercity Project)
HCC L&T Purulia Joint Venture
L&T- Shanghai Urban Corporation Group Joint Venture
Mr. J. P. Nayak (whole-time director)
Mrs. Neeta J. Nayak (wife)
Mr. Nitin Nayak (son)
Mr. K. Venkataramanan (whole-time director)
Mrs. Jyothi Venkataramanan (wife)
Mr. K. V. Rangaswami (whole-time director)
Mr. V. K. Magapu (whole-time director)
8
Mr. M. V. Kotwal (whole-time director)
ii.
Disclosure of related party transactions:
Sr. Nature of transaction/relationship/major parties
no.
Rs.crore
2008-2009
2007-2008
Amount
Amounts for
major parties
Amount Amounts for
major parties
1
Purchase of goods & services (including commission paid)
Associates & joint ventures, including:
935.15
1063.43
Audco India Limited
EWAC Alloys Limited
Total
627.65
126.69
821.41
138.88
935.15
1063.43
2
Sale of goods/power/contract revenue & services
Associates & joint ventures, including:
725.15
85.13
Audco India Limited
L&T Arun Excello Realty Private Limited
L&T-Komatsu Limited
Second Vivekananda Bridge Tollway Company Private Limited
The Dhamra Port Company Limited
Total
3
Purchase/lease of fixed assets
Associates & joint ventures, including:
L&T-Case Equipment Private Limited
L&T-Komatsu Limited
EWAC Alloys Limited
Total
228
–
–
–
–
659.27
2.37
1.19
2.68
12.45
25.28
21.02
16.05
–
11.13
6.86
2.43
85.13
20.42
725.15
6.23
6.23
20.42
Notes forming part of the Consolidated Accounts (contd.)
Sr. Nature of transaction/relationship/major parties
no.
Rs.crore
2008-2009
2007-2008
Amount
Amounts for
major parties
Amount Amounts for
major parties
4
Subscription to equity and preference shares
(including application money paid and investment in joint ventures)
Associates & joint ventures, including:
89.21
169.17
L&T Arun Excello Realty Private Limited
L&T-Shanghai Urban Corporation Group
Feedback Ventures Limited
The Dhamra Port Company Limited
L&T-AM Tapovan Joint Venture
L&T-Eastern Joint Venture
Total
Receiving of services from related parties
Associates & joint ventures, including:
L&T-Komatsu Limited
L&T-Chiyoda Limited
L&T-Ramboll Consulting Engineers Limited
Total
Rent paid, including lease rentals under leasing/hire purchase
arrangements including loss sharing on equipment finance
Associates & joint ventures, including:
5
6
EWAC Alloys Limited
L&T-Komatsu Limited
Key management personnel
Relatives of key management personnel
Total
7
Charges for deputation of employees to related parties
Associates & joint ventures, including:
EWAC Alloys Limited
L&T-Case Equipment Private Limited
Audco India Limited
L&T-Komatsu Limited
L&T-Chiyoda Limited
L&T-Ramboll Consulting Engineers Limited
The Dhamra Port Company Limited
Total
8
Dividend received
Associates & joint ventures, including:
L&T-Komatsu Limited
EWAC Alloys Limited
Audco India Limited
International Seaports (Haldia) Private Limited
Voith Paper Technology (India) Limited
89.21
8.81
8.81
1.07
0.11
0.14
1.32
26.50
26.50
57.95
–
13.57
–
35.00
19.17
9.71
–
7.30
1.38
0.35
0.72
2.73
5.27
8.56
3.37
4.46
–
–
28.80
12.44
9.00
–
6.00
169.17
0.13
0.13
0.87
0.13
0.11
1.11
1.31
1.31
12.98
Total
57.95
12.98
29.14
–
37.90
30.00
45.25
–
0.13
–
–
0.33
0.53
–
–
–
0.33
0.10
0.11
0.13
3.60
1.45
3.60
1.47
2.85
229
Notes forming part of the Consolidated Accounts (contd.)
Sr. Nature of transaction/relationship/major parties
no.
9
Commission received, including those under agency arrangements
Associates & joint ventures, including:
L&T-Komatsu Limited
Total
10
Rent received, overheads recovered and miscellaneous income
Associates & joint ventures, including:
L&T-Case Equipment Private Limited
Audco India Limited
L&T-Chiyoda Limited
L&T-Komatsu Limited
Metro Tuneling Group
Total
11
Interest received
Associates & joint ventures, including:
L&T-Case Equipment Private Limited
L&T-Demag Plastic Machinery Limited
Key management personnel
Total
12
Interest paid
Associate:
Audco India Limited
Total
13
Payment of salaries/perquisites
Key management personnel:
A. M. Naik
J. P. Nayak
Y. M. Deosthalee
K. Venkataramanan
R. N. Mukhija
K. V. Rangaswami
V. K. Magapu
M. V. Kotwal
Rs.crore
2008-2009
2007-2008
Amount
Amounts for
major parties
Amount Amounts for
major parties
151.47
151.47
60.19
60.19
1.01
0.07
1.08
7.77
7.77
149.57
10.87
16.05
7.73
6.11
7.45
1.01
–
7.77
207.05
207.05
24.95
24.95
1.30
0.03
1.33
2.35
2.35
56.46
38.02
12.55
6.39
7.16
7.11
7.07
5.21
5.22
5.75
198.52
4.61
3.63
6.92
–
–
–
1.30
2.35
8.39
4.31
4.83
4.79
4.74
3.54
3.54
3.88
Total
56.46
38.02
"Major parties" denote entities who account for 10% or more of the aggregate for that category of transaction during respective period.
230
Notes forming part of the Consolidated Accounts (contd.)
iii.
Amount due to/from related parties
Sr.
no.
Nature of transaction/relationship/major parties
Rs.crore
As at 31-3-2009
As at 31-3-2008
Amount
Amounts for
major parties
Amount Amounts for
major parties
1
Accounts receivable
Associates & joint ventures, including:
209.87
58.27
L&T Arun Excello Realty Private Limited
Second Vivekanand Bridge Tollway Company Private Limited
The Dhamra Port Company Limited
Total
2
Accounts payable (including acceptance & interest accrued)
Associates & joint ventures, including:
Audco India Limited
L&T-Hochtief Seabird Joint Venture
Total
3
Loans & advances recoverable
Associates & joint ventures, including:
L&T-Case Equipment Private Limited
L&T-Demag Plastics Machinery Limited
L&T-AM Tapovan Joint Venture
Key management personnel
Relatives of key management personnel
Total
4
Unsecured loans (including lease finance)
Joint venture:
Metro Tunneling Group
Total
5
Advances received in the capacity of supplier of goods/services
classified as "advances from customers" in the Balance Sheet
Associates & joint ventures, including:
Second Vivekananda Bridge Tollway Company Private Limited
L&T Arun Excello Realty Private Limited
The Dhamra Port Company Limited
Total
6
Due to whole-time directors
Key management personnel:
209.87
368.17
368.17
118.54
0.66
0.10
119.30
20.00
20.00
23.46
23.46
35.47
A. M. Naik
J. P. Nayak
Y. M. Deosthalee
K. Venkataramanan
R. N. Mukhija
K. V. Rangaswami
V. K. Magapu
M. V. Kotwal
58.27
383.17
383.17
105.55
0.79
0.06
106.40
–
–
8.89
8.89
21.96
–
–
183.16
267.77
62.86
–
–
71.26
20.00
–
8.03
15.43
8.45
4.22
4.22
4.22
4.22
3.38
3.38
3.38
Total
35.47
21.96
"Major parties" denote entities who account for 10% or more of the aggregate for that category of transaction during respective period.
15.12
27.71
11.29
254.61
65.90
12.67
12.05
55.07
–
1.56
7.33
–
5.23
2.62
2.62
2.61
2.61
2.09
2.09
2.09
231
Notes forming part of the Consolidated Accounts (contd.)
iv. Notes to related party transactions:
a)
b)
c)
The Company has a sole selling agreement with L&T- Komatsu Limited (LTK), an associate company, valid for the period of 5
years from October 16, 2006 in line with Government of India (GOI) approval letter dated May 28, 2007. The appointment shall
be in effect as long as the joint venture agreement between the Parent Company and M/s Komatsu Asia Pacific Pte. Ltd.,
Singapore (which is a subsidiary of Komatsu Ltd., Japan) remains in force, subject to approval of GOI, under section 294 AA of
the Companies Act, 1956. As per the terms of the agreement, the Company is the exclusive agent of L&T-Komatsu Limited to
market LTK machines and provide product support. Pursuant to the aforesaid agreement, LTK is required to pay commission to
the Company at specified rates on the sales effected by the Company.
The Company has renewed the selling agency agreement from October 1, 2003 with EWAC Alloys Limited (EWAC), an associate
company. The agreement shall remain valid until either party gives 12 months' prior written notice to the other for termination. As
per the terms of the agreement, the Company is the selling agent authorised to purchase and resell EWAC products in accordance
with the prices and other conditions stipulated in the agreement.
The Company has a selling agency agreement with L&T-Demag Plastics Machinery Limited (LTDPML), a wholly owned subsidiary.
As per the terms of the agreement, the Company is a selling and servicing agent of LTDPML. Pursuant to the aforesaid agreement,
LTDPML is required to pay commission to the Company at specified rates on sales effected by the Company.
Note: The financial impact of the agreements mentioned at (a) to (c) above has been included in/disclosed vide note no.18(ii) supra.
19. Leases:
i) Where the Company is a lessor:
a)
b)
The Company has given on finance leases certain items of plant and machinery. The leases have a primary period that is fixed
and non-cancellable and a secondary period. There are no exceptional/restrictive covenants in the lease agreement.
The total gross investment in these leases as on March 31, 2009 and the present value of minimum lease payments receivable
as on March 31, 2009 is as under:
Particulars
1. Receivable not later than 1 year
2. Receivable later than 1 year and not later than 5 years
3. Receivable later than 5 years
Gross investment in lease (1+2+3)
Less: Unearned finance income
Present value of receivables
Rs.crore
3.67
3.33
–
7.00
0.78
6.22
c)
In respect of one of the leases referred to in (a) above, the lease receivables were recorded at the inception, at the present value
of minimum lease payments, and subsequently securitised.
ii) Where the Company is a lessee:
Finance leases:
i)
a)
Assets acquired on finance lease mainly comprise plant & machinery, vehicles and personal computers. The leases have a
primary period, which is fixed and non-cancellable. In the case of vehicles, the Company has an option to renew the lease
for a secondary period. The agreements provide for revision of lease rentals in the event of changes in (a) taxes, if any,
leviable on the lease rentals (b) rates of depreciation under the Income tax Act, 1961 and (c) change in the lessor's cost of
borrowings. There are no exceptional/restrictive covenants in the lease agreements.
The minimum lease rentals as at March 31, 2009 and the present value as at March 31, 2009 of minimum lease payments
in respect of assets acquired under finance leases are as follows:
Particulars
Rs.crore
Minimum lease
payments
Present value of minimum
lease payments
As at
31-3-2009
As at
31-3-2008
As at
31-3-2009
As at
31-3-2008
1.
2.
3.
Payable not later than 1 year
Payable later than 1 year and not later than 5 years
Payable later than 5 years
Total
Less: Future finance charges
Present value of minimum lease payments
0.50
0.60
–
1.10
0.10
1.00
0.27
0.18
–
0.45
0.04
0.41
0.46
0.54
–
1.00
0.25
0.16
–
0.41
ii)
232
Notes forming part of the Consolidated Accounts (contd.)
iii) Contingent rent recognised/(adjusted) in the Profit and Loss Account in respect of finance leases: Rs.nil (previous year:
Rs.0.02 crore)
b) Operating leases:
i.
The Company has taken various residential/commercial premises and plant and machinery under cancellable operating
leases. These lease agreements are normally renewed on expiry.
ii.
[a] The Company has taken certain assets on non-cancellable operating leases, the future minimum lease payments in
respect of which, as at March 31, 2009 are as follows:
1.
2.
3.
Minimum Lease Payments
Payable not later than 1 year
Payable later than 1 year and not later than 5 years
Payable later than 5 years
Total
Rs.crore
18.34
19.83
2.10
40.27
[b] The lease agreements provide for an option to the Company to renew the lease period at the end of the non-cancellable
period. There are no exceptional/restrictive covenants in the lease agreements.
iii.
Lease rental expense in respect of operating leases: Rs.50.33 crore (previous year: Rs.39.81 crore)
20. Basic and Diluted Earnings per share ["EPS"] computed in accordance with Accounting Standard (AS) 20 "Earnings per Share":
Particulars
Basic
Profit after tax as per accounts (Rs.crore)
Weighted average number of shares outstanding
Basic EPS (Rupees)
Diluted
Profit after tax as per accounts (Rs.crore)
Add: Interest/exchange difference (gain)/loss on bonds
convertible into equity shares (net of tax) (Rs.crore)
Before
extraordinary items
After
extraordinary items
2008-2009
2007-2008
2008-2009
2007-2008
3017.00
2325.36
3789.46
2325.36
58,51,18,186
57,50,52,204 58,51,18,186 57,50,52,204
51.56
40.44
64.76
40.44
3017.00
2325.36
3789.46
2325.36
–
(21.85)
–
(21.85)
A
B
A/B
A
B
Adjusted profit for diluted earnings per share (Rs.crore)
C=A+B
3017.00
2303.51
3789.46
2303.51
Weighted average number of shares outstanding
Add: Weighted average number of potential equity
shares that could arise on conversion of FCCBs
Add: Weighted average number of potential equity shares
on account of employee stock options
D
E
F
58,51,18,186
57,50,52,204 58,51,18,186 57,50,52,204
–
24,59,448
–
24,59,448
79,89,615
1,39,06,732
79,89,615
1,39,06,732
Weighted average number of shares outstanding for diluted EPS G=D+E+F
59,31,07,801
59,14,18,384 59,31,07,801 59,14,18,384
Diluted EPS (Rupees)
C/G
50.87
38.95
63.89
38.95
233
Notes forming part of the Consolidated Accounts (contd.)
21. Disclosures required by Accounting Standard 29 "Provisions, Contingent Liabilities and Contingent Assets":
a) Movement in provisions:
Particulars
Product
Warranties
Excise
Duty
Sales
Tax
Rs.crore
Class of Provisions
Litigation
Contractual Others
Total
obligations
related rectification cost-
Construction
contracts
Balance as at 1-4-2008
19.14
4.06
22.18
2.11
62.40
3.37 113.26
Additional provision during the year
Effect of business combination
Provision for extraordinary item*
8.33
0.44
–
–
–
–
20.65
–
–
–
–
–
Provision reversed during the year
9.67
3.96
1.12
2.11
128.43
8.84 166.25
–
–
0.44
– 186.28 186.28
–
11.30
28.16
Balance as at 31-3-2009
(6 = 1 + 2 + 3 + 4 - 5)
18.24
0.10
41.71
–
190.83 187.19 438.07
Sr.
no.
1
2
3
4
5
6
* Refer note no.13
b) Nature of provisions:
i.
Product warranties: The Company gives warranties on certain products and services, undertaking to repair or replace the items
that fail to perform satisfactorily during the warranty period. Provision made as at March 31, 2009 represents the amount of the
expected cost of meeting such obligations of rectification/replacement. The timing of the outflows is expected to be within a
period of two years from the date of Balance Sheet.
ii.
Provision for excise duty represents the differential duty liability that is expected to materialise in respect of matters in appeal.
iii. Provision for sales tax represents mainly the differential sales tax liability on account of non-collection of declaration forms for the
period prior to 5 years.
iv. Provision for litigation related obligations represents liabilities that are expected to materialise in respect of matters in appeal.
v.
Contractual rectification cost represents the estimated cost the Company is likely to incur during defect liability period as per the
contract obligations in respect of completed construction contracts accounted under Accounting Standard (AS) 7 "Construction
Contracts".
c) Disclosures in respect of contingent liabilities are given as part of Schedule J to the Balance Sheet.
22. Estimated amount of contracts remaining to be executed on capital account (net of advances) Rs.4350.85 crore (previous year:
Rs.3644.58 crore).
23. a)
Provision for current tax includes:
i)
Provision for wealth tax Rs.3.37 crore (including Rs.0.98 crore being provision for wealth tax in respect of earlier years) (previous
year: Rs.1.23 crore)
ii)
Rs.53.94 crore being provision for income tax in respect of earlier years (previous year: reversal of provision of Rs.25.33 crore)
iii) Credit for Minimum Alternative Tax (MAT) entitlement Rs.18.59 crore (previous year: Rs.7.57 crore) under section 115JB of the
Income Tax Act, 1961.
iv) Rs.2.07 crore in respect of income tax payable outside India (previous year: Rs.nil)
v) Rs.0.50 crore being provision for income tax in respect of a subsidiary which was sold during the year.
b)
Provision for tax on fringe benefits includes credit for excess provision of Rs.0.20 crore pertaining to earlier years, reversed during the
year.
24. a) Computation of cumulative deferred tax asset/liabilities has not been made in respect of certain foreign subsidiaries of the Group. In
the opinion of management, the impact is not material.
234
Notes forming part of the Consolidated Accounts (contd.)
b) Major Components of deferred tax liabilities and deferred tax assets:
Rs.crore
Deferred
Charge/(credit) to
tax Profit and Loss Account
Effect
due to
Charge/(credit) to
reserves
Particulars
liabilities/
(assets) Ordinary
activity
31-3-2008
Extra- acquisition/ Retained Translation
reserve
earnings
disposal
ordinary
activity
Deferred
tax
liabilities/
Hedging Securities
premium
(assets)
reserve
account 31-3-2009
Deferred tax liabilities:
Difference between book and
tax depreciation
Gain on derivative transactions to be
offered for tax purposes in the year of
transfer to Profit and Loss Account
Disputed statutory liabilities paid and
claimed as deduction for tax purpose
but not debited to Profit and Loss Account
Others
Total
291.74
78.84
2.69
(2.67)
–
–
24.25
2.49
11.05
11.78
–
–
–
–
–
–
327.04
93.11
2.69
(2.67)
Deferred tax (assets):
Provision for doubtful debts and advances
debited to Profit and Loss account
Loss on derivative transactions to be
claimed for tax purposes in the year
of transfer to Profit and Loss Account
Unpaid statutory liabilities/provision
for compensated absences debited to
Profit and Loss Account
(104.28) (52.81)
–
–
(49.29) (19.53)
Unabsorbed depreciation/brought
forward business losses
(14.99)
Other items giving rise to timing difference
(36.76)
6.54
8.05
Total
(205.32) (57.75)
–
–
–
–
–
–
–
–
–
–
(0.16)
(0.16)
Net deferred tax liability/(assets)
121.72
35.36
2.69
(2.83)
–
–
–
–
–
–
–
–
–
–
–
–
(0.08)
–
–
370.52
–
121.03
–
121.03
–
–
–
–
(0.08)
121.03
–
–
–
26.74
22.83
541.12
–
–
– (157.09)
– (147.06)
– (147.06)
–
–
–
–
–
–
–
–
–
(68.82)
(8.45)
(28.87)
– (147.06)
– (410.29)
(0.08)
(26.03)
–
130.83
Previous year
107.41
31.74
– (39.74)
21.10
(0.02)
–
1.23 121.72
25. a)
The Group has undertaken various projects on Build-Operate-Transfer (BOT) basis as per the concession agreements with the
government authorities. Under the agreements the concession period for toll collection or annuity payments ranges from 15 to 32
years. At the end of the said concession period, the entire facilities are transferred to the concerned government authorities.
b)
c)
The aggregate amount of revenues and profits before tax (net) recognised during the year in respect of construction services related
to Build-Operate-Transfer (BOT) projects is Rs.1320.32 crore and Rs.8.29 crore respectively [refer accounting policy disclosed in
Schedule ‘Q’ vide para 2(a)(ix)]
Loans and advances include Rs.550.31 crore (previous year: Rs.232.84 crore) being cumulative construction costs incurred including
related margins in respect of Build-Operate-Transfer (BOT) projects.
26. The Parent Company has given, inter alia, the following undertakings in respect of its investments:
a)
Jointly with L&T Infrastructure Development Projects Limited (a subsidiary of the Company), to the term lenders of its subsidiary
companies L&T Transportation Infrastructure Limited (LTTIL):
i.
ii.
not to reduce their joint shareholding in LTTIL below 51% until the financial assistance received from the term lenders is repaid
in full by LTTIL and
to jointly meet the shortfall in the working capital requirements of LTTIL until the financial assistance received from the term
lenders is repaid in full by LTTIL.
235
Notes forming part of the Consolidated Accounts (contd.)
b)
c)
d)
e)
f)
In terms of Company's concession agreement with Government of India and Government of Gujarat, not to change the control over
L&T Western India Tollbridge Limited (a subsidiary of L&T Infrastructure Development Projects Limited) during the period of the
Agreement.
To the debenture holders of L&T Infrastructure Development Projects Limited (a subsidiary of the Company) and to the lenders of its
subsidiaries L&T Panipat Elevated Corridor Private Limited and L&T Krishnagiri Thopur Toll Road Limited, not to dilute Company's
shareholding below 51%.
To the lender of L&T Offshore International FZC (a subsidiary of the Company), not to pledge or reduce its shareholding in L&T
International FZE (the Holding Company of L&T Offshore International FZC) below 100% of the issued & allotted share capital.
Jointly with L&T-MHI Turbine Generators Private Limited (a subsidiary of L&T Power Limited, which is a wholly owned subsidiary of
the Company) and Mitsubishi Heavy Industries Limited (JV partners in L&T-MHI Turbine Generators Private Limited), to Andhra
Pradesh Power Development Company Limited (APPDCL) to render unconditional and irrevocable financial support for the successful
execution of APPDCL 2x800 MW Power Project - Steam Turbine Generator Package Tender, near Krishnapatnam, Nellore District,
Andhra Pradesh.
Not to sell or otherwise transfer, deal with or agree to acquire, sell or otherwise transfer or deal with, in any manner the shares of
Satyam Computer Services Limited (SCSL), held by the Company till October 21, 2009 or a date approved by the appropriate
authorities whichever is earlier.
27. L&T Infrastructure Development Projects Limited (LTIDPL), a subsidiary of the Parent Company
i.
ii.
iii.
iv.
v.
has pledged its investment in the equity shares of Second Vivekananda Bridge Tollway Company Private Limited (SVBTC) of Rs.32.35
crore to the lenders as security for term loans sanctioned by them to SVBTC.
has given an undertaking to the term lenders of SVBTC to subscribe to quasi equity of the Company to the extent of Rs.10 crore.
Accordingly, the Company has subscribed in cumulative redeemable convertible preference shares to the extent of Rs.10 crore.
has entered into agreements with the lenders to Bangalore International Airport Limited (BIAL) for pledge and non-disposal of shares
held by it in BIAL amounting to Rs.19.61 crores.
has pledged its investment in the equity shares of The Dhamra Port Company Limited (DPCL) of Rs.80.87 crores.
has given the following undertakings jointly with Pacific Alliance Stradec Group Infrastructure Company LLC and SVBTC to the term
lenders of SVBTC:
a)
not to reduce the joint shareholding below 51% during construction period and for 3 years following Commercial Operations Date
and below 26% during the balance remaining operations period.
vi.
has given the following undertakings jointly with Tata Steel Limited and DPCL to the term lenders of DPCL:
a)
b)
to meet the cost overrun to the extent of 10% of the project cost and
not to reduce the joint share holding below 51% upto the Commercial Operations Date and below 26% during the balance
remaining operations period.
vii. has given the undertaking to the term lenders of Narmada Infrastructure Construction Enterprise Limited (NICE) to facilitate the
borrower (NICE) to discharge its debt obligation to the extent the loan funds have been placed with LTIDPL and its Group Companies.
viii. has pledged its investment in the equity shares of the followings subsidiary companies to the lenders of term loan of the respective
companies.
Rs.crore
Sr. no. Name of the subsidiary companies
As at 31-3-2009
As at 31-3-2008
1
2
3
4
5
L&T Panipat Elevated Corridor Limited
L&T Krishnagiri Thopur Toll Road Limited
L&T Western Andhra Tollway Limited
L&T Vadodara Bharuch Tollway Limited
L&T Interstate Road Corridor Limited
42.99
40.16
28.81
22.18
27.60
17.11
13.32
8.21
22.16
14.82
236
Notes forming part of the Consolidated Accounts (contd.)
The Company has also given the following undertaking, to the term lenders of the aforesaid subsidiary companies:
a)
b)
c)
not to reduce its shareholding in the said subsidiary companies below 51% upto a period of 3 years after commercial operation
date and below 26% till final settlement date.
to meet the cost overrun to the extent of 5% of the project cost.
in the case of L&T Vadodara Bharuch Tollway Limited: to provide financial support to the borrower to meet shortfall, if any, in
meeting the debt repayment after receipt of termination payment from National Highways Authority of India, in the event of a
termination of the concession agreement pursuant to occurrence of the concessionarie event of default or any force majeure
event as stated in the said concession agreement.
28.
29.
In terms of provisions of sub-section 1A of section 115O of the Income Tax Act, 1961, dividend distribution tax payable by the Company, is
net of dividend distribution tax paid by its subsidiary company Larsen & Toubro Infotech Limited, amounting to Rs.2.69 crore, related to
dividend of Rs.15.80 crore declared by them. Accordingly, the additional tax on dividend includes Rs.2.69 crore paid by the aforesaid
subsidiary company.
In line with the Company's risk management policy, the various financial risks mainly relating to changes in the exchange rates, interest
rates and commodity prices are hedged by using a combination of forward contracts, swaps and other derivative contracts, besides the
natural hedges.
a)
The particulars of derivative contracts entered into for hedging purposes outstanding as at March 31, 2009 are as under:
Category of derivative instruments
i)
For hedging foreign currency risks
a)
Forward contracts for receivables including firm commitments
and highly probable forecasted transactions
b)
Forward contracts for payables including firm commitments
and highly probable forecasted transactions
c) Currency swaps
d) Option contracts
ii)
For hedging interest rate risks
Interest rate swaps
iii)
For hedging commodity price risks
Commodity futures
Rs.crore
Amount of exposures hedged
As at
31-3-2009
As at
31-3-2008
4607.57
3004.48
7059.34
4996.36
1203.80
2086.69
3858.49
4983.70
125.00
350.00
12.98
–
b) Unhedged foreign currency exposures as at March 31, 2009 are as under:
Unhedged foreign currency exposures
As at
31-3-2009
i)
ii)
Receivables, including firm commitments and highly probable forecasted transactions
19213.48
Payables, including firm commitments and highly probable forecasted transactions
12573.50
Rs.crore
As at
31-3-2008
14668.08
10264.39
237
Notes forming part of the Consolidated Accounts (contd.)
30. Disclosure pursuant to Accounting Standard (AS) 15 (Revised) "Employee Benefits":
i.
Defined contribution plans: [refer accounting policy no.5b(i)]
Amount of Rs.70.73 crore (previous year: Rs.56.16 crore) is recognised as an expense and included in "staff expenses" (Schedule N)
in the Profit and Loss Account.
ii.
Defined benefit plans: [refer accounting policy no.5b(ii)]
a)
The amounts recognised in Balance Sheet are as follows:
Particulars
Gratuity plan
Post-retirement
medical benefit plan
Company
pension plan
Trust-managed
provident fund plan
Rs.crore
As at
As at
31-3-2009 31-3-2008 31-3-2009 31-3-2008 31-3-2009 31-3-2008 31-3-2009 31-3-2008
As at
As at
As at
As at
As at
As at
A) Amounts to be recognised in Balance Sheet
Present Value of defined benefit obligation
– Wholly funded
– Wholly unfunded
Less: Fair value of plan assets
Less: Unrecognised past service costs
289.74
243.33
0.93
0.75
290.67
255.06
–
244.08
213.22
–
Amount to be recognised as liability or (asset)
35.61
30.86
B) Amounts reflected in the Balance Sheet
–
75.83
75.83
–
1.43
74.40
–
60.31
60.31
–
1.57
–
–
1127.81
1014.16
152.79
152.44
–
–
152.79
152.44
1127.81
1014.16
–
0.98
–
1151.80
1014.85
1.09
–
–
58.74
151.81
151.35
(23.99)@ (0.69)@
Liabilities
Assets
35.61
30.86
74.40
58.74
151.81
151.35
17.45
11.44
–
–
–
–
–
–
–
–
Net liability/(asset)
35.61
30.86
74.40
58.74
151.81
151.35
17.45#
11.44#
b)
The amounts recognised in Profit and Loss Account are as follows:
Gratuity plan
Post-retirement
medical benefit plan
Company
pension plan
Trust-Managed
provident fund plan
2008-2009 2007-2008 2008-2009 2007-2008 2008-2009 2007-2008 2008-2009 2007-2008
Rs.crore
18.86
20.11
17.43
17.44
(16.04)
(12.09)
9.46
8.09
–
–
0.05
–
–
(0.07)
32.37
29.09
–
–
0.05
–
0.07
(0.04)
30.95
18.58
4.12
5.30
–
9.44
0.13
–
–
–
–
–
2.75
4.04
–
1.36
5.45
–
–
–
–
–
4.55
13.02
–
5.18
0.11
(19.57)
–
–
–
–
3.51
10.07
44.87**
48.72**
87.44
78.28
–
(88.86)
(79.72)
21.65
(24.11)
12.36
0.11
–
–
–
–
–
–
–
–
–
–
–
25.53+
(10.92)
–
–
44.87
81.60
–
–
48.72
67.36
18.99
13.60
3.29
35.34
–
–
–
–
Particulars
Current service cost
Interest cost
Expected return on plan assets
Actuarial losses/(gains)
Past service cost
Effect of any curtailment or settlement
Adjustment for earlier years
Actuarial (loss)/gain not recognised in books
Excess provisions
1.
2.
3.
4.
5.
6.
7.
8.
9.
10. Amount capitalised out of the above
Total included in "staff expenses" (1 to 10)
Actual return on plan assets
238
Notes forming part of the Consolidated Accounts (contd.)
c)
The changes in the present value of defined benefit obligation representing reconciliation of opening and closing balances
thereof are as follows:
Gratuity plan
Post-retirement
medical benefit plan
Company
pension plan
Trust-managed
provident fund plan
Rs.crore
Particulars
Opening balance of the present value of
defined benefit obligation
Add: Current service cost
Add: Interest cost
Add: Contribution by plan participants
i) Employer
ii) Employee
Add: Actuarial losses
Less: Benefits paid
Add: Past service cost
Add: Liabilities assumed in an amalgamation/
acquisition
Add/(less): Adjustment for earlier years
Less: Effect of any curtailment or settlement
Closing balance of the present value of defined
benefit obligation
As at
As at
31-3-2009 31-3-2008 31-3-2009 31-3-2008 31-3-2009 31-3-2008 31-3-2009 31-3-2008
As at
As at
As at
As at
As at
As at
244.08
212.63
60.31
47.09
152.44
119.76
1014.16
933.74
18.86
20.11
17.43
17.44
–
–
–
–
4.12
5.30
–
–
22.51
14.58
(15.51)
(18.47)
9.44
(3.34)
–
–
0.32
0.30
–
0.12
0.35
–
–
–
–
–
2.75
4.04
–
–
1.36
(2.16)
7.02
–
0.21
4.55
13.02
–
–
5.18
(2.83)
–
–
–
–
(19.57)
3.51
44.87**
–
10.07
87.44
78.28
–
–
21.64
–
88.34
–
48.72**
98.32
–
(2.54)
(102.14)
(126.97)
–
–
–
–
–
–
–
–
(4.86)
(17.93)
–
–
290.67
244.08
75.83
60.31
152.79
152.44
1127.81
1014.16
d) Changes in the fair value of plan assets representing reconciliation of the opening and closing balances thereof are as follows:
Rs.crore
Gratuity plan
Trust-managed
provident fund plan
Particulars
Opening balance of the fair value of the plan assets
Add: Expected return on plan assets*
Add/(less): Actuarial gains/(losses)
Add: Contribution by the employer
Add: Contribution by plan participants
Less: Benefits paid
Add: Business combinations/acquisitions
Add/(less): Adjustments for earlier years
Closing balance of the plan assets
As at
As at
31-3-2009 31-3-2008 31-3-2009 31-3-2008
As at
As at
213.22
16.04
13.05
27.91
–
(15.51)
0.33
0.02
255.06
160.33
12.09
6.49
52.21
–
(18.47)
0.13
0.44
213.22
1014.85
88.86
24.11
44.24
87.02
(102.14)
–
(5.14)
1151.80
947.84
79.72
(12.36)
47.79
97.16
(126.97)
–
(18.33)
1014.85
Note: The fair value of the plan assets under the trust-managed provident fund plan has been determined at amounts based
on their value at the time of redemption, assuming a constant rate of return to maturity.
*
Basis used to determine the overall expected return:
The Trust formed by the Company manages the investments of provident funds and gratuity fund. Expected return on plan
assets is determined based on the assessment made at the beginning of the year on the return expected on its existing portfolio,
along with the estimated increment to the plan assets and expected yield on the respective assets in the portfolio during the year.
The Company expect to fund Rs.33.38 crore (previous year: Rs.30.11 crore) towards its gratuity plan and Rs.63.01 (previous
year: Rs.51.64 crore) towards its trust-managed provident fund plan during the year 2009-2010.
@ Asset is not recognised in the Balance Sheet
#
**
+
Employer's and employees' contribution (net) for March is paid in April
Employer's contribution to provident fund
The actual return on plan assets is higher than interest cost, but no credit has been taken to the Profit and Loss Account
239
Notes forming part of the Consolidated Accounts (contd.)
e)
The major categories of plan assets as a percentage of total plan assets are as follows:
Gratuity plan
Trust-managed
provident fund plan
Particulars
Government of India Securities
State Government Securities
Corporate Bonds
Equity Shares of Listed Companies
Fixed Deposits under Special Deposit Scheme framed by Central Government
for Provident Funds
Insurer Managed Funds
Public Sector Unit Bonds
Others
As at
As at
31-3-2009 31-3-2008 31-3-2009 31-3-2008
As at
As at
41%
–
38%
1%
14%
2%
–
4%
39%
–
38%
1%
16%
2%
–
4%
23%
13%
5%
–
27%
–
32%
–
22%
13%
5%
–
30%
–
30%
–
f)
Principal actuarial assumptions at the Balance Sheet date (expressed as weighted averages):
1 Discount rate:
a) Gratuity plan
b) Company pension plan
c) Post-retirement medical benefit plan
2 Expected return on plan assets
3 Annual increase in healthcare costs (see note below)
4 Salary growth rate:
a) Gratuity plan
b) Company pension plan
5
Attrition rate:
As at 31-3-2009
As at 31-3-2008
7.67%
7.67%
7.67%
7.50%
5.00%
6.00%
7.00%
8.33%
8.35%
8.39%
7.50%
5.00%
6.00%
7.00%
a)
For post-retirement medical benefit plan & company pension plan, the attrition rate varies from 2% to 8% (previous
year: 2% to 8%) for various age groups.
b)
For gratuity plan the attrition rate varies from 1% to 7% (previous year: 1% to 7%) for various age groups.
6
7
8
9
The estimates of future salary increases, considered in actuarial valuation, take into account inflation, seniority, promotion
and other relevant factors, such as supply and demand in the employment market.
The interest payment obligation of trust-managed provident fund is assumed to be adequately covered by the interest
income on long term investments of the fund. Any shortfall in the interest income over the interest obligation on cumulative
basis is recognised immediately in the Profit and Loss Account as actuarial losses.
The obligation of the company under the post-retirement medical benefit plan is limited to the overall ceiling limits. At
present, healthcare cost, as indicated in the principal actuarial assumption given above, has been assumed to increase at
5% p.a.
A one percentage point change in assumed healthcare cost trend rates would have the following effects on the aggregate
of the service cost and interest cost and defined benefit obligation:
Particulars
Effect on the aggregate of the service cost and interest cost
Effect on defined benefit obligation
Rs.crore
Effect of 1%
increase
Effect of 1%
decrease
2008-2009 2007-2008 2008-2009 2007-2008
0.88
5.08
0.60
4.00
(1.19)
(3.80)
(0.99)
(3.30)
240
Notes forming part of the Consolidated Accounts (contd.)
g)
The amounts pertaining to defined benefit plans are as follows:
Particulars
1
Post-retirement medical benefit plan (unfunded)
Defined benefit obligation
Experience adjustment plan liabilities
2
Gratuity plan (funded/unfunded)
Defined benefit obligation
Plan assets
Surplus/(deficit)
Experience adjustment plan liabilities
Experience adjustment plan assets
3
Post-retirement pension plan (unfunded)
Defined benefit obligation
Experience adjustment plan liabilities
4
Trust managed provident fund plan (funded)
Defined benefit obligation
Plan assets
Surplus/(deficit)
h) General descriptions of defined benefit plans:
1. Gratuity plan:
Rs.crore
As at
31-3-2009
As at
As at
31-3-2008 31-3-2007
74.40
1.13
290.67
255.06
(35.61)
8.38
13.71
151.81
(6.89)
58.74
2.66
47.09
–
244.08
213.22
212.63
160.33
(30.86)
(52.30)
16.44
(2.92)
25.84
6.59
151.35
118.56
26.87
–
1127.81
1151.80
23.99
1014.16
1014.85
0.69
933.74
947.84
14.10
The Company operates gratuity plan wherein every employee is entitled to the benefit equivalent to fifteen days salary last
drawn for each completed year of service. The same is payable on termination of service or retirement whichever is earlier.
The benefit vests after five years of continuous service. The Company's scheme is more favourable as compared to the
obligation under Payment of Gratuity Act, 1972. A small part of the gratuity plan, which is not material, is unfunded and
managed within the Company.
2.
Post-retirement medical benefit plan:
The Post-retirement medical benefit plan provides for reimbursement of health care costs to certain categories of employees
post their retirement. The reimbursement is subject to an overall ceiling sanctioned based on cadre of the employee at the
time of retirement.
3. Company's pension plan:
In addition to contribution to State-Managed Pension Plan (EPS scheme), the Company operates a post retirement pension
scheme, which is discretionary in nature for certain cadres of employees. The quantum of pension depends on the cadre of
the employee at the time of retirement.
4.
Trust-managed provident fund plan:
The Company manages provident fund plan through a Provident Fund Trust for its employees which is permitted under the
Provident Fund and Miscellaneous Provisions Act, 1952. The plan envisages contribution by employer and employees and
guarantees interest at the rate notified by the Provident Fund Authority. The contribution by employer and employee together
with interest are payable at the time of separation from service or retirement whichever is earlier. The benefit under this plan
vests immediately on rendering of service.
241
Notes forming part of the Consolidated Accounts (contd.)
31. Miscellaneous expenses include donations aggregating to Rs.4.70 crore made during the year to political parties as follows: Akhil Bharatiya
Congress Committee: Rs.2.25 crore, Bharatiya Janata Party: Rs.2.00 crore and Shiv Sena Madhyavarti Karyalaya: Rs.0.45 crore.
32. There are no amounts due and outstanding to be credited to Investor Education & Protection Fund as at March 31, 2009.
33. Certain elements of operational income of business segments forming a part of segment results used to be hitherto categorised as a part
of 'other income' in the Profit and Loss Account. During the current year the same have been regrouped under “other operational income”
in the Profit and Loss Account to reflect the proper classification.
34.
Interest income, has been shown separately as a part of “other income” during current year.
35. Figures for the previous year have been regrouped/reclassified wherever necessary.
As per our report attached
SHARP & TANNAN
Chartered Accountants
by the hand of
F. M. KOBLA
Partner
Membership No.15882
Mumbai, May 28, 2009
A. M. NAIK
Chairman & Managing Director
Y. M. DEOSTHALEE
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
BHAGYAM RAMANI
A. K. JAIN
N. HARIHARAN
Company Secretary
Directors
Mumbai, May 28, 2009
ATTENDANCE
SLIP
Registered Office:
L&T House, Ballard Estate, Mumbai - 400 001.
ANNUAL GENERAL MEETING - AUGUST 28, 2009 AT 3.00 P.M.
NAME & ADDRESS OF THE REGISTERED SHAREHOLDER
DP. Id
Client Id/
Folio No.
No. of Shares
I certify that I am a registered shareholder/proxy for the registered shareholder of the Company.
I hereby record my presence at the ANNUAL GENERAL MEETING of the Company at Birla Matushri Sabhagar,
19, Marine Lines, Mumbai - 400 020 on Friday, August 28, 2009.
Note: Please complete this and hand it over at the entrance of the hall.
SIGNATURE
Registered Office:
L&T House, Ballard Estate, Mumbai - 400 001.
FORM OF
PROXY
ANNUAL GENERAL MEETING - AUGUST 28, 2009 AT 3.00 P.M.
I/We ..............................................................................................................................................................................
of ............................................ in the district of.........................................................being a member/members of
LARSEN & TOUBRO LIMITED hereby appoint .....................................................................................................
of ............................................ in the district of ................................................................................ or failing him
................................................ of .................................. in the district of ................................................................
as my/our proxy to vote for me/us on my/our behalf at the ANNUAL GENERAL MEETING of the Company to be
held on Friday, August 28, 2009 and at any adjournment thereof.
Signed this ............................. day of ................................2009.
DP. Id
Client Id/
Folio No.
No. of Shares
Affix a
15 paise
Signature ....................................................
Revenue
Stamp
Note: This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of
the Company, not less than 48 hours before the commencement of the Meeting.
.
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