BUILDING THE FUTURE
68th Annual Report
68th Annual Report
2012-2013
2012-2013
A. M. Naik
Group Executive Chairman
Dear Shareholders,
It has been a challenging year for Indian industry. The
economy, impacted by decelerating GDP growth, mounting
fiscal deficit and high Current Account Deficit, has seen
lacklustre investment momentum in infrastructure, energy
and industrial capital expenditure.
The few positives to emerge from this scenario were the
clutch of fiscal reforms introduced in the latter half of
the year with a view to revving up the economy. These
measures range from phased deregulation of diesel
prices, formation of a Cabinet Committee on Investments,
direct transfer of subsidies to beneficiaries and efforts
to reduce the losses of state-owned power distribution
companies. These measures will need to be sustained and
supplemented by a slew of others to effectively recharge
the economy and restore its growth trajectory.
Performance Overview
Against the backdrop of this challenging environment,
your Company has turned in a commendable performance
on all key performance parameters.
Order Inflows which are the mainstay of any company
engaged predominantly in Engineering & Construction
business, clocked in at
88,035 Cr representing an
impressive 25% growth over the previous year. The
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unexecuted Order Book at the year-end stands at 153,604
Cr. This provides a healthy revenue and margin visibility
over the next few years. Project execution was largely on
track - borne out in the 14% growth in Gross Revenues
which came in at
61,471 Cr. Profit after Tax registered
4,911 Cr which translates to a growth of 10% over the
previous year.
At the Group level, Gross Revenues displayed a growth of
16% and stood at 75,195 Cr for the year under review.
PAT, at
5,206 Cr represents a growth of 11% over the
previous year.
It gives me pleasure to announce that your Company has
recommended dividend of
18.50 per equity share on a
face value of 2 per share for the year. The corresponding
dividend during the previous fiscal was at
16.50 per
equity share.
In addition, I am glad to share that, in the th anniversary
year, your Company has also recommended bonus shares
in the ratio of 1:2 (i.e., one bonus equity share of
2/-
each for every two equity shares of 2/- each held).
Internationalisation
In times of challenge, a mix of long range strategy and agile
tactical responses are critical to success. Your Company
has countered the slowdown in the domestic market
by expanding its footprint and intensifying operations
in geographies with promising business potential. This
outreach is predominantly in the Gulf countries, South
East Asia Regions and now working to extend to Australia,
a few CIS countries and select African nations. Quite a
few senior business development executives of different
nationalities and having rich domain experience with
customer insight have been inducted at the local level in
these countries.
The thrust on penetration into international markets is
yielding results. International Order Inflows represent 17%
of the total inflows during the year under review.
become a global phenomenon and is not restricted to
India. Hence development of human resources, along with
talent acquisition continues to receive focussed attention
in your Company.
People remain the cornerstone of the organisation.
We ensure that employees gain ample opportunities
for personal and professional growth. Our Leadership
Development Academy in Lonavala - Maharashtra, Project
Management Institutes at Vadodara - Gujarat and at
Chennai - Tamil Nadu, and systematic career progression of
staff are a few of the multiple initiatives that will facilitate
succession planning.
We recognize that the process of internationalization
involves adopting and embracing a multi-cultural work
ethos - while retaining our core national identity. We have
intensified recruitment of lateral hires at the management
level, particularly in the Gulf countries and for new growth
geographies.
Sustainable Development
Your Company has aligned itself with the Millennium
Development Goals formulated by the United Nations,
and has progressed well on the Social, Environmental
and Economic agenda pursued over the last few years.
Considerable headway has been made in the areas of
energy conservation, healthcare, environment protection
and social uplift of the deprived sections of society. The
Company harnesses untapped energy of India’s youth
through broad-based skill development centres and
promotes social development through on-going mother
& child healthcare programmes. Your Company has been
recognised in various national and international forums for
its sustainability efforts.
Outlook
Even as the macro environment remains challenging, your
Company is effectively targeting specific opportunities
within India and internationally. Segments that hold
promise in FY14 include –
Talent Management
In the last two decades, we have seen the young
generation being attracted to new economy sectors,
resulting in lack of top talent coming into the core sector,
particularly in Project and Construction industry. This has
1) Infrastructure -
a) Roads – This segment witnessed severe
contraction in ordering by NHAI in FY13 but is
expected to pick up in FY14 through ordering of
more than 3,500 km of new projects on Engineering,
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Procurement & Construction (EPC) mode. We
being the distinct leader in the segment, will
selectively participate in these EPC bids where
the prospects meet our internal viability benchmarks.
Some upcoming road projects in the Gulf countries
are also being targeted in FY14.
b) Metro and Mono Rails – The Company has been
involved in the execution of metro rail projects
in cities across the country and India’s first monorail
in Mumbai (trial runs conducted in FY13). This
enables the Company to exploit opportunities to
secure contracts in India, where multiple cities are
initiating metro rail projects. We are also
participating in mass rapid transport prospects in
the Gulf countries.
c) Railways Business – The thrust on strengthening
the rail network across the country holds good
prospects for our railways business. We have
already secured an initial order in consortium with
a Japanese company for a major section of
the Dedicated Freight Corridor. We are also
exploring international markets, especially the Gulf
countries where several projects are coming up.
d) Water & Renewable Energy – Backed by strong
project execution capabilities and operational
excellence, the Company has achieved good
growth in Water and Renewable Energy sector
in FY13. With current Order Backlog and good
order prospects, the business from these sectors is
expected to see an upswing in FY14.
e) Urban Infrastructure – Opportunities in residential
buildings, office space, hospitals, hotels,
educational institutions, shopping complexes and
factories continue to provide a large canvass of
business potential. Your Company has become the
EPC contractor of choice for major developers and
this is driving profitable growth.
f) Airports – Increasing passenger and cargo traffic
has sustained growth in aviation industry. On the
back of excellent track record in this sector, we are
well-positioned for airport projects within and outside
India.
2) Heavy Engineering & Shipbuilding -
We have the capability to meet the requirements for high
technology critical equipment and systems. In the process
plant equipment segment, the international market looks
promising in the medium term. The domestic nuclear
segment is expected to see ordering activity in FY14. The
defence sector has been adversely impacted by the slow
pace of decision making as well as deferral of contract
awards. However, recent initiatives to involve private
sector in defence equipment manufacturing augurs well
for your Company.
The shipyard at Kattupalli has been completed and is
capable of building warships, submarines and specialized
commercial vessels. It is equipped with a state-of-the-
art shiplift that enables it to undertake simultaneous
new build, repair & refits. While the global commercial
shipbuilding trend remains subdued, we envisage that
the Indian defence sector is likely to open up and provide
opportunities for building defence vessels.
3) Hydrocarbon –
On the domestic front, Exploration & Production (E&P)
spends in upstream hydrocarbon segment is expected to
sustain during FY14. The announcement of the recent
policy to treat fertiliser production on priority basis
will result in setting up new fertilizer plants. This will
provide increased opportunities. Onshore gas processing
segment is also expected to witness implementation
of redevelopment projects. Large investments are also
expected in cross-country pipeline projects.
In the upstream sector, the Company is equipped to repair,
rebuild and construct new Jack-ups, drilling rigs and
FPSO topsides. The business is well placed to leverage its
multi-locational Modular Fabrication Facilities to respond
to global trends towards modularization of onshore Gas
Processing plants.
We have improved our international presence through
several prestigious orders. We are increasingly pursuing
opportunities overseas through alliances with the leading
global EPC companies. This has necessitated putting in
place a multi-national organization, with a cross-cultural
team possessing local knowledge and domain expertise.
The Company proposes to form a subsidiary for its
Hydrocarbon Business. This will enable greater autonomy
and formulation of HR policies in line with industry
practices so as to attract the best talent.
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4) Thermal Power -
Policy paralysis, negative market sentiments and procedural
bottlenecks have adversely affected the domestic Power
sector in the last couple of years. Pressing concerns with
respect to land, fuel, financing and statutory approvals
have dried up the order pipeline, putting pressure on the
Company’s capacity utilization.
This is further aggravated by large scale imports since
the country’s policies do not provide a level playing field,
particularly against imports from ‘managed’ economies.
Under the circumstances, we are doing our best to be
competitive through cost reduction, design optimisation
and smart sourcing.
Emphasis will also be on expanding our spectrum of
services to select Gulf countries and the Southeast Asia
for Gas based power plants.
5) Power Transmission & Distribution -
Government policies lay stress on investments in
strengthening the power grid and the power distribution
system through central and multilateral funding agencies.
We have demonstrated a steady growth in order book
position in domestic and international markets.
The emphasis on strengthening of transmission grids in
Gulf countries will continue to provide significant business
opportunities for power transmission and distribution
business in the coming years.
6) Metallurgical and Material Handling -
The short-term outlook in this area continues to be
challenging, due to prevailing complexities of policies
governing mining, land acquisition and absence of
new power projects. These are sought to be resolved
through various government proposals, legislations
and policies. As the economy grows, demand for
metals particularly steel, aluminium and copper will
necessitate expansion of capacity. We are well positioned
to benefit from the confidence we enjoy because of
our track record and timely completion of projects.
Material Handling prospects in areas of power, mining,
ports and long distance conveyors for bulk ores are likely
to grow in line with economic growth.
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7) Electrical & Automation -
The Electrical & Automation business continues to
maintain its leadership position in LV Switchgear. It has also
made a mark in the MV segment through an acquisition
of an international company a few years ago. Product
development in both LV and MV Switchgear continues to
forge ahead. The project business has enhanced its focus
on international markets. The coming year should see an
upward momentum. The Company has also acquired two
small companies which will bridge technology gaps in one
case and enhance product range in another.
8) Machinery & Industrial Products -
The Construction Machinery business maintained its
leadership position in premium excavators segment
despite shrinkage in construction equipment market
and entry of new competitors. In Industrial Products, the
valves business maintained the positive trend in FY13,
registering a growth in sales of 9% over the previous year.
Major investments in the oil & gas segment planned in
the USA, Middle East and other countries provide good
opportunities for international operations.
9) Information Technology & Integrated Engineering
Services Business -
L&T Infotech, a wholly owned subsidiary, grew at 22%
Y-o-Y on a consolidated basis. Profit after Tax grew by
49%.
L&T Infotech has embarked on building a strong sales and
marketing team globally with emphasis on the Americas,
Europe, Gulf countries and the Far East. The Company has
also undertaken some major initiatives intended to make
the L&T Infotech name more visible and distinctive because
of differentiated solutions it offers in multiple domains.
Technology Services, a Strategic Business Unit of L&T,
is being formed into a subsidiary, which will result into
consolidation of all engineering services business of L&T
and L&T Infotech. This subsidiary will provide autonomous
functioning in line with industry practices.
10) Financial Services -
This business, which was listed in 2011, continues to grow
profitably with a loan book in excess of
33,000 Cr at
the end of FY13. Net Interest Margins at 5.5% reflect
the healthy interest spreads that the business earns.
The business has successfully concluded acquisitions in
mutual funds business and housing finance. The insurance
business is also joining hands with the Future Group
and the Generali Group to leverage the complementary
strengths of both players and to enable achievement of
scale and early profitability.
11) Developmental Projects -
Development projects undertaken by the Company in
roads, ports, metro rail and power continue to progress
satisfactorily, with some of these projects currently
operational. The Company plans to open up alternate funding
lines to enable commissioning of the upcoming projects and
reduce dependencies on your Company’s balance sheet.
Before I conclude, I would like to extend my thanks to
Team L&T, customers, vendors and other stakeholders,
without whom our continued growth momentum would
not have been possible. I would also like to thank my
fellow Board Members for their unstinted support and
encouragement.
Thank You
A. M. Naik
Group Executive Chairman
Mumbai, May 22, 2013
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Contents
Company Information
Organisation Structure
Leadership Team
L&T Nationwide Network & Global Presence
Corporate Sustainability
Annual Business Responsibility Report
Standalone Financials - 10 Year Highlights
Consolidated Financials - 10 Year Highlights
Graphs
Directors’ Report
Management Discussion & Analysis
Auditors’ Report
Balance Sheet
Statement of Profit and Loss
Cash Flow Statement
Notes forming part of Accounts
Auditors’ Report on Consolidated Financial Statements
Consolidated Balance Sheet
Consolidated Statement of Profit and Loss
Consolidated Cash Flow Statement
Notes forming part of Consolidated Accounts
Information regarding Subsidiary Companies
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7
8 - 9
10
12 - 13
14 - 21
22 - 37
38
39
40 - 41
42 - 86
87 - 146
147 - 149
150
151
152
153 - 221
222 - 223
224
225
226
227 - 288
289 - 308
Company Information
Board of Directors
MR. A. M. NAIK
Group Executive Chairman
MR. K. VENKATARAMANAN
Chief Executive Officer & Managing Director
MR. M. V. KOTWAL
Whole-time Director & President (Heavy Engineering)
MR. S. N. SUBRAHMANYAN
Whole-time Director & Senior Executive Vice President
MR. R. SHANKAR RAMAN
Whole-time Director & Chief Financial Officer
MR. SHAILENDRA ROY
Whole-time Director & Senior Executive Vice President
(Construction & Infrastructure)
(Corporate Affairs & Power)
MR. S. RAJGOPAL
Independent Director
MR. S. N. TALWAR
Independent Director
MR. M. M. CHITALE
Independent Director
MR. N. MOHAN RAJ
Nominee of LIC
MR. SUBODH BHARGAVA
Independent Director
MR. A. K. JAIN
Nominee of SUUTI
MR. M. DAMODARAN
Independent Director
MR. VIKRAM SINGH MEHTA
Independent Director
MR. SUSHOBHAN SARKER
Nominee of LIC
Company Secretary
Registered Office
Auditors
Solicitors
Mr. N. Hariharan
L&T House, Ballard Estate, Mumbai - 400 001
M/s. Sharp & Tannan
M/s. Manilal Kher Ambalal & Co.
Registrar & Share Transfer Agents
Sharepro Services (India) Private Limited
68th ANNUAL GENERAL MEETING AT BIRLA MATUSHRI SABHAGAR, 19, MARINE LINES, MUMBAI 400 020 ON THURSDAY, AUGUST 22, 2013 AT 3.00 P.M.
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Leadership Team
A. M. Naik
Group Executive Chairman
K. Venkataramanan
CEO & Managing Director
M. V. Kotwal
President
(Heavy Engineering)
S. N. Subrahmanyan
Sr. Executive Vice President
(Construction & Infrastructure)
R. Shankar Raman
Chief Financial Offi cer
Shailendra Roy
Sr. Executive Vice President
(Corporate Affairs & Power)
S. C. Bhargava
Sr. Vice President
(Electrical & Automation)
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Nationwide Network
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Global Presence
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Corporate Social Responsibility
The Company’s social responsiveness long predates the
entry into the corporate lexicon of terms like ‘CSR’. Our
people feel the pulse of the social milieu in which they
operate. They believe in inclusive growth and reach out
to assist the communities around them - not because it is
the magic formula for sustainability, but simply because
that is, and always has been, part of the collective
character of Team L&T.
answers to the many and complex problems confronting
communities. There are no ‘Mr. Know-It-Alls’ in our
teams, ready to show the light to all those in need.
Instead our qualified and trained social development
professionals are committed to working with community
members, listening to them and understanding the
problems from their perspective. It is together, in a close
and collaborative spirit, that we arrive at lasting solutions.
We are well aware that being a leading engineering and
technology company does not mean that we have the
The Company invests in the growth of communities around
its campuses through various social initiatives.
of the nation’s youth through skill development initiatives
and nurture mother & child health care programmes.
Thrust Areas
We empower via education, harness the untapped energy
Over the years, our efforts to strengthen the foundations
of the social pyramid have intensified and expanded.
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SOCIAL SCORE-CARD
• Reached out to half a million beneficiaries
• Seven community health centres set-up, and more underway
• Livelihood for over 5000 underprivileged women
• Engagement with over 50 community learning centres
• Outreach to over 150 schools and over 10,000 underprivileged children.
Education
The Company’s social interventions in this sphere are
focused on providing primary education, infrastructure
development and enhancing the learning experience for
children in schools in the vicinity of our units across India.
We adopt innovative teaching techniques and focus on
subjects like Mathematics and English which many children
find challenging. Our mobile teaching unit - ‘Science on
Wheels’ visits schools and provides pupils with a ‘hands
on’ opportunity to perform science experiments .
We also extend support to pre-schools, assist in
infrastructure development, set up computer labs and
libraries as well as provide teaching-aids and uniforms to
the needy. Other activities include organizing summer
camps and conducting sports events.
Mother & Child Health
A woman is the nucleus of the family, which in turn is the
focal point of society. Mother & child heath, therefore is
one of the thrust areas of our social initiatives. Initiatives
for maternal and child health include: setting up of health
centres with a focus on reproductive health, conducting
diagnostic and clinical health camps that support maternal
and child health care, immunization and health education.
Health camps are conducted by qualified and experienced
teams. Mobile clinics enhance our reach to those in need.
‘Science on Wheels’ - L&T joins hands with an NGO to promote
science in schools. This is part of L&T’s broad spectrum of
community initiatives.
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Skill Building
Scaffolding erection training at CSTI, Chennai
The Company is one of the few construction organizations
in India with dedicated skill training institutes which
offer the prospect of subsequent employment with
contractors at the Company’s project sites. L&T provides
formal vocational training in construction for the largely
unorganized workforce in this sector through Construction
Skills Training Institute (CSTI). CSTIs provides free-of-cost
training in construction skills to rural and urban youth in
various trades such as bar bending, formwork carpentry,
masonry, scaffolding and welding etc. This training is a
transformational process that improves the skill set of the
underprivileged youth and enhances their employability.
The Company has also introduced vocational training
programmes in tailoring, beautician skills, home nursing
and food processing for women. Such training helps build
self-reliance and reduce vulnerabilities.
L&T-eering
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Employee volunteering is a company-wide movement
driven solely by the passion to serve. More and more
L&T-ites are opting to be ‘L&T-eers’, and add value to
society through their time, energy and expertise. L&T
encourages employees to volunteer for CSR activities and
make a tangible difference to the world in which they live
by investing their time and personal resources to serve the
communities around them.
Ladies Clubs
The Ladies Clubs led by the spouses of Company employees
across various locations are a unique group. They pool
their skills and resources in the spirit of service to work
towards the development of communities.
Ladies Clubs are involved in several initiatives which include
providing educational support programmes for schools,
organizing vocational training courses for underprivileged
youth and enabling women to enhance their income
generation capacity. The Clubs also provide support to
the disabled.
Larsen & Toubro Public Charitable Trust
(LTPCT)
LTPCT is committed to the inclusive growth of society
through interventions in education, vocational training,
health care and water management. Over a hundred check
dams have been constructed by the Trust in drought-prone
rural Maharashtra. The dams help in irrigation, facilitate
ground water recharge and have resulted in stemming
migration to cities. The ‘Science on Wheels’ mobile
teaching unit has introduced over 1,50,000 children
across the country to the wonders of science.
Towards a Greener Tomorrow
Air, water and earth are the givers and sustainers of life.
And the irony is that the very survival of these lifelines is
now in our hands. If we choose to conduct ourselves with
care and responsibility, our natural assets will continue to
nourish life as they have been doing for ages. If we let
expediency and immediate self-interest prevail, however,
we could well be cutting off our own lifelines.
With every passing year the issue of climate change finds
deeper resonance in the Company. It influences our
decision making in key areas, spurs product and process
innovation and determines our product mix to clients.
Our initiatives are aimed at reduction in carbon intensity,
utilisation of clean and renewable energy sources and
engineering of green buildings.
As builders to the nation, the Company’s strategies are
also in synch with the nation’s needs, be it infrastructure
development or environmental management. Our
initiatives and actions closely follow the Government of
India’s Nation Action Plan on Climate Change.
From commissioning India’s largest solar power plant
to becoming an energy auditor accredited by a leading,
global body, from sowing saplings of change to spreading
sustainability knowledge, from undertaking carbon
sequestration study to water footprint mapping - our
progress on the eight national missions is rapid and
decisive.
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Here is how our businesses are contributing to preserving
the environment:
Construction
The uncertainties and anxieties around the impact of
construction on the environment has been converted into
an opportunity. We now lead the way in eco-friendly
construction, having built more certified green buildings
than any other company. We have secured several LEED
certifications for buildings constructed for ourselves and
for our customers.
partnership mode. Like all such systems, the Hyderabad
Metro will help make the city green, reduce automobile
traffic, save fuel and arrest GHG emissions. In Mumbai,
we are also building and developing a mono rail - a ‘first’
for India. In addition, we contribute significantly to the
metro systems being built in other major cities around
the country.
Solar Power
The Company is India’s industry leader in building solar
PV power plants.
L&T has constructed ITC’s 600-room five-star hotel - the world’s
largest LEED-certified green hotel
Solar PV panels installed at Powai campus
Metro Rail
The Company is constructing and developing a metro rail
system in Hyderabad - one of the largest mass rapid transit
systems in the world being built through the public-private
Wastewater Treatment
We provide solutions for desalination, wastewater
re-cycling and re-use. We also provide technologies for
zero discharge of wastewater.
The Hyderabad Metro Rail Project being developed by L&T IDPL
in partnership with the government. This project will drastically
cut down commuting time and enhance the quality of life in
Hyderabad.
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Hydrocarbon
The Company has a long track record of EPC execution
of projects for fuel switch, dehydrogenation and
desulphurization for fertiliser manufacturers and refineries.
Power
Power plants present the typical dilemma of development.
They are essential for progress and yet they are known
to impact the environment. The Company offers the
supercritical solution. Supercritical thermal power plants
uses steam in a way that improves the turbine cycle heat
rate. This reduces carbon dioxide emissions as well as other
lifecycle costs such as land and water.
Heavy Engineering
We all know that the energy clock is ticking, and traditional
sources of fuel are getting rapidly depleted. Under a
technical tie-up with Shell, the Company manufactures
and supplies equipment that helps to derive gas from coal.
This is one of the many ways in which we are helping
reduce dependency on a single, increasingly finite fuel
source.
Electrical & Automation
A range of products in the Company’s electrical &
automation portfolio is helping industries and domestic
consumers at home and commercial complexes to increase
energy efficiency.
Prayas - a special effort for special people. This is one of multiple social initiatives that the Company is engaged in.
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L&T Aligns with National Action Plan Missions
Solar
Enhanced Energy Efficiency
Achievements include providing EPC solutions for solar
PV power plants, commissioning India’s largest solar
power plant (40 MWp), and executing 6 MWp solar PV
power plants in less than three months. The Company’s
units in Chennai, Hazira, Talegaon, Mahape, Vadodara,
Ahmednagar, Mysore, Coimbatore and Sohar (Oman)
continue to harness the power of the sun. L&T has
executed a total of 114 MWp solar EPC power plants.
The Company introduced energy-efficient products and
processes, saving 123,417 GJ of energy, indirectly reducing
over 27,000 tonnes of CO2 emission. Renewable energy
constitutes 10.48% of L&T’s energy mix. The Company’s
E&A business offers products and solutions that enable
customers reduce their energy consumption. It can provide
energy audit services and is accredited by the Bureau of
Energy Efficiency (BEE).
Sustainable Habitat
Water
The Company has constructed over 14.4 million sq. ft. of
green buildings for clients in the reporting year, taking
L&T’s green-building tally to 25.2 million sq. ft to date.
Seven buildings measuring 1.6 million sq. ft. on the
Company premises are certified green buildings – two
each Platinum, Gold and Silver, and one Certified.
Water-footprint mapping at six campuses helped the
Company identify water-efficiency opportunities. 16 out
of 22 locations adopted the zero-wastewater-discharge
approach, reducing the total water consumption by 6.3%
w.r.t. 2008-09 scope. For Thane’s water-deficient tribals,
the Company built 50 check dams with a total capacity
of approx.191 million litres. The Company executes large
water-management projects covering distribution, water
treatment, etc.
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Green India
Sustainable Agriculture
The Company conducted a carbon sequestration study
at six campuses, which have sequestered 16,309 tonnes
of CO2 to date. A green cover clothes around 35% of
the available open land at our manufacturing locations.
Across L&T’s campuses and project sites, the Company
has planted over 265,000 tree saplings, and nurtures over
150,000 fully-grown trees.
In the fertiliser sector, the Company executed eco-friendly
projects specifically to reduce energy consumption in urea
plants. Also reduced are SOx emissions and ammonia
discharge into wastewater via ‘fuel switch’ projects. The
Company is preferred by most Indian fertiliser plants for
critical equipment. The Company’s electrical products
enable agricultural irrigation.
Sustaining the Himalayan Ecosystem
Strategic Knowledge for Climate Change
The Company has strengthened its focus on employment
opportunities and infrastructure development, and
conducts community engagement initiatives – such as
medical camps and tree plantation. The Company is
reinforcing ‘skill-building’ training programmes at project
sites.
The Company’s corporate sustainability initiatives are
available on www.lntsustainability.com. The Company
participates in forums, pertaining to sustainability and
climate change. Green initiatives are shared through
factory visits, and related information is disseminated
to new employees. The Company is developing a pool
of certified ‘sustainability assurance practitioners’, and
organizes capacity-building training related to energy
auditing / management certified by BEE.
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Annual Business Responsibility Report (ABRR)
The Business Responsibility Report (BRR) format conforms
to Securities & Exchange Board of India (SEBI) listing
requirement. It covers the National Voluntary Guidelines
(NVG) based on Social, Environmental & Economic
Responsibilities of Business released by the Ministry of
Corporate Affairs, India.
The Company also publishes a Sustainability Report every
year, prepared as per the Global Reporting Initiative
(GRI) G3 guidelines. The Sustainability Reports are
externally assured and are ‘GRI Checked Application
Level A+’, signifying the highest level of disclosure in
public domain since 2008. The report can be accessed at
www.lntsustainability.com.
The Company is the first engineering & construction
company in India to report on its Corporate Sustainability
performance, and among the earliest to state its
conformance with the eight missions announced by the
Prime Minister of India in the National Action Plan on
Climate Change (NAPCC).
Section A: General Information about the Company
1. Corporate Identity Number (CIN) of the Company: L99999MH1946PLC004768
2. Name of the Company: Larsen & Toubro Limited
3. Registered address: L&T House, Ballard Estate, Mumbai: 400 001, India
4. Website: www.larsentoubro.com
5. Email id: sustainability-ehs@larsentoubro.com
6. Financial Year reported: 1st April 2012-31st March 2013
7. Sector(s) that the Company is engaged in (industrial activity code-wise):
Group
Class
Sub Class
Description
Manufacture of electric motors, generators, transformers and electricity distribution and control
apparatus
Manufacture of parts and accessories for machinery / equipment used by construction and mining industries.
Building of commercial vessels, passenger vessels, ferry boats, cargo ships, tankers, tugs, hovercraft (except
recreation type hovercraft), etc.
Building of warships and scientifi c investigation ships, etc.
Construction of fl oating or submersible drilling platforms.
Construction of buildings carried out on own-account basis or on a fee or contract basis.
Construction and maintenance of motorways, streets, roads, other vehicular and pedestrian ways, highways,
bridges, tunnels and subways.
Construction and maintenance of railways and rail-bridges.
Construction and maintenance of power plants
Construction / erection and maintenance of power, telecommunication and transmission lines.
Construction and maintenance of industrial facilities such as refi neries, chemical plants, etc.
Wholesale of construction and civil engineering machinery and equipment.
Real estate activities with own or leased property.
Architectural and engineering activities and related technical consultancy.
28246
30111
30112
30114
41001
42101
42102
42201
42202
42901
46594
68100
71100
271
2710
282
301
2824
3011
410
421
4100
4210
422
4220
465
681
711
4659
6810
7110
22
8. List three key products/services that the Company manufactures/provides (as in balance sheet)
1. Construction and project related activity.
2. Manufacturing and trading activity.
3. Engineering service.
9. Total number of locations where business activity is undertaken by the Company
i. Number of International Locations: 35
ii. Number of National Locations: 100
10. Markets served by the Company – Local/State/National/International: All
Section B: Financial Details of the Company
1. Paid up Capital (INR): `123.08 Crore
2. Total Turnover (INR): `61,470.86 Crore
3. Total profit after taxes (INR): `4,910.65 Crore
4. Total Spending on Corporate Social Responsibility (CSR) as percentage of profit after tax (%): 1.49%
5. List of activities in which expenditure in 4 above has been incurred:
Community and social engagements broadly covering;
a. Education
b. Skill Building
c. Mother & Child Care
d. Environment protection
Section C: Other Details
1. Does the Company have any Subsidiary Company/Companies?
Yes
2. Do the Subsidiary Company/Companies participate in the BR Initiatives of the parent company? If yes, then indicate
the number of such subsidiary company(s):
Yes. The Business Responsibility (BR) initiatives of the company are extended to the Subsidiary/Associate
Companies and these are encouraged to participate in various related activities of BR.
3. Do any other entity/entities (e.g. suppliers, distributors etc.) that the Company does business with, participate in
the BR initiatives of the Company? If yes, then indicate the percentage of such entity/entities? [Less than 30%,
30-60%, More than 60%]:
Yes. The Company promotes BR initiatives in its value chain. At present, less than 30% of its suppliers/
distributors participate in BR initiatives.
Section D: BR Information
1. Details of Director/Directors responsible for BR
a) Details of the Director/Director responsible for implementation of the BR policy/policies
• DIN Number: Not Applicable
• Name: Mr. R. N. Mukhija
• Designation: Advisor to the Chairman
23
b) Details of the BR head
S. No.
Particulars
Details
1.
2.
3.
4.
5.
DIN Number (If applicable)
Not Applicable
Name
Designation
Mr. Ajit Singh
Executive Vice President – Corporate Infrastructure & Services
Telephone Number
+91-22-67053431
Email ID
Sustainability-ehs@larsentoubro.com
2. Principle-wise (as per NVGs) BR Policy/policies (Reply in Y/N)
Name of principles:
P1 – Businesses should conduct and govern themselves with Ethics, Transparency and Accountability
P2 – Businesses should provide goods and services that are safe and contribute to sustainability throughout their
life cycle
P3 – Businesses should promote the well-being of all employees
P4 – Businesses should respect the interests of, and be responsive towards all stakeholders, especially those who
are disadvantaged, vulnerable and marginalized
P5 – Businesses should respect and promote human rights
P6 – Businesses should respect, protect, and make efforts to restore the environment
P7 – Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner
P8 – Businesses should support inclusive growth and equitable development
P9 – Businesses should engage with and provide value to their customers and consumers in a responsible manner
S. No.
Questions
P1
P2
P3
P4
P5
P6
P7
P8
P9
1.
2.
3.
4.
5.
6.
7.
8.
Do you have a policy/policies for
Has the policy being formulated in consultation with the relevant
stakeholders?
Does the policy conform to any national /international standards?
If yes, specify? (50 words)
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Yes. The policies are aligned with NVG guidelines
and applicable international standards of ISO
9001, ISO 14001, OHSAS 18001 and ILO principles.
Has the policy being approved by the Board?
Yes. Meanwhile approved by the Executive Management
Committee (EMC)1
If yes, has it been signed by MD/owner/CEO/appropriate Board Director?
Signed by the Group Executive Chairman
Does the company have a specifi ed committee of the Board/ Director/
Offi cial to oversee the implementation of the policy?
Yes. Mr. R. N. Mukhija, Advisor to the Chairman and also member
of the EMC.
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Indicate the link for the policy to be viewed online?
www.lntsustainability.com
Has the policy been formally communicated to all relevant internal and
external stakeholders?
Does the company have in-house structure to implement the
policy/policies.
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
1 EMC of the Company comprises executive directors, senior managerial personnel and advisors to the Chairman.
24
Questions
P1
P2
P3
P4
P5
P6
P7
P8
P9
S. No.
9.
Does the Company have a grievance redressal mechanism related to the
policy/policies to address stakeholders’ grievances related to the policy/
policies?
10.
Has the company carried out independent audit/evaluation of the work-
ing of this policy by an internal or external agency?
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
2a.
If answer to S.No. 1 against any principle, is ‘No’, please explain why: (Tick up to 2 options)
S. No.
Questions
P1
P2
P3
P4
P5
P6
P7
P8
P9
1.
2.
3.
4.
5.
6.
The company has not understood the Principles
The company is not at a stage where it fi nds itself in a position to formu-
late and implement the policies on specifi ed principles
The company does not have fi nancial or manpower resources available
for the task
It is planned to be done within next 6 months
It is planned to be done within the next 1 year
Any other reason (please specify)
-------
-------
-------
-------
-------
-------
3. Governance related to BR
• Indicate the frequency with which the Board of Directors, Committee of the Board or CEO assess the BR
performance of the Company. Within 3 months, 3-6 months, Annually, More than 1 year
o Annually
• Does the Company publish a BR or a Sustainability Report? What is the hyperlink for viewing this report? How
frequently it is published?
Yes, the Company has been publishing its Sustainability Report annually as per the framework
of Global Reporting Initiative (GRI) G3 since 2008. The sustainability reports are externally assured
and are ‘GRI Checked Application Level A+’, signifying the highest level of disclosure. The report can
be accessed at www.lntsustainability.com
Section E:
Principle 1: Businesses should conduct
and govern themselves with Ethics,
Transparency and Accountability
Ethics, transparency and accountability are the bedrock
of the Company’s operations. Its commitment to these
values is articulated in the Company’s Vision Statement
and in the following policies:
• Corporate Social Responsibility (CSR)
• Corporate Environment, Health & Safety (EHS)
• Corporate Human Resources
These policies are extended to subsidiary & associate
companies. The environmental & social code of conduct
for suppliers includes clauses on ethics and transparency.
The Company’s corporate governance, social and environmental disclosure practices are proactive and demonstrate high standards of ethics. Review of policies,
procedures and guidelines is an on-going process.
25
The Company’s board and senior management affirm
the ‘Code of Conduct’ annually. In addition, policies,
procedures and guidelines have been formulated to clearly
lay down norms on action and conduct of its employees
such as the whistle-blower policy and guidelines on
communication and marketing.
The Company’s Executive Managing Committee (EMC)
ensures effective formulation and implementation of
the sustainability strategy. EMC decides on policies to
be implemented across the Company. In addition, at the
corporate level, sustainability initiatives and performance
are regularly reviewed by a nominated member of the
EMC.
The Company has been disclosing its sustainability
performance in public domain within the framework of
Global Reporting Initiative (GRI). All Sustainability Reports
published by the Company are GRI Checked Application
Level A+.
For details related to stakeholder complaints, refer the
Director’s Report Section of this Annual Report.
Principle 2: Businesses should provide
goods and services that are safe and
contribute to sustainability throughout
their life cycle
The Company is a technology, engineering, construction,
and manufacturing company. Over 85% of the Company’s
revenues are from the Engineering and Construction (E&C)
business. The Company recognizes that its projects and
products are technology-intensive and meet critical needs.
Safety and sustainability are therefore integrated right at
the design stage.
Technology Block, Hazira
PLATINUM (LEED)
Green Buildings at
L&T Locations
Office Complex, Talegaon
L&T TC III, Chennai
PLATINUM (LEED)
SILVER (LEED)
Office Complex, Ahmednagar
L&T TC II, Chennai
GOLD (IGBC)
CERTIFIED (LEED)
EDRC, Chennai
SILVER (LEED)
Knoweldge City, Vadodara
GOLD (LEED)
In addition to initiatives that reduce the Company’s own
carbon footprint, it is also a green enabler - helping its
customers “Go Green” too. A high degree of expertise has
been developed in the following: ‘Green Buildings’, solar
EPC power plants, fuel switch projects, Dehydrogenation
& Desulphurization (DHDS) projects, coal gasifiers, super
critical thermal power plant & equipment, electricity
transmission & distribution systems, and energy-saving
electrical & automation equipment.
Green buildings constructed by the Company help to
reduce water consumption by over 30%, utilise recycled
material to the extent of 10% and largely source material
locally. The Company is a leading EPC solution provider
26
for Solar Photo Voltaic (PV) based power plants. Typically,
a 40 MW solar power plant leads to a reduction of nearly
70,000 MT of CO2 annually. The Industrial Drive systems of
Electrical & Automation business save energy up to 30%
or more.
The hydrocarbon business of the Company executes
energy conservation and fuel switch projects for fertiliser
plants and refineries. Fertiliser plants are increasingly being
encouraged to switch from fuel oil & Low Sulphur Heavy
Stock (LSHS) based ammonia plants to natural gas and
Re-gasified Liquefied Natural Gas (R-LNG) based plants.
The Company is at the forefront of executing these
conversion projects which significantly help clients reduce
sulphur emissions and improving product quality.
The Company has proven capability in reducing SOx / NOx
emissions during crude oil refining and also achieving
energy efficiency.
The heavy engineering business of the Company
manufactures coal gasifiers for core industries. Many
developed countries use coal gasifier technology as energy
conservation and environmental friendly measures.
At project sites, safety is an overriding concern. The
Company fosters a strong safety culture through best
practices, continuous training and vigilant supervision.
Safety tool box talk
The Company is the first company in the E&C space in
India to establish a full-fledged Safety Innovation School.
The Company undertakes the following initiatives to
mitigate adverse environmental impacts
• Noise barriers & noise monitoring
• Dust suppression & air quality monitoring
• Recycling & reuse of wastewater
The Company practices greener ways of construction and
manufacturing; covering material optimization, using
eco-friendly raw materials, and adopting energy efficient
processes.
Product performance extends beyond product
specifications and takes into account life cycle assessments,
legal requirements as well as Environment, Health & Safety
(EHS) aspects.
The labelling process is implemented in line with the
relevant codes & specifications. The Company’s electrical
& automation products and industrial machinery carry
the BIS label, most of these products have international
certifications and are tested at independent laboratories.
Sustainability Practices in Value Chain
The Company views each of its vendors as partners in
the shared process of growth. The Company invests time
and effort in building mutually beneficial relationships.
The Company guides small & medium scale enterprises in
process and system improvement and enhanced technical
know-how. Specific encouragement is provided to local
sourcing as it improves logistics as well as helps to develop
the local economy. Around 80% of the Company’s
requirements are met by local suppliers. In addition, the
Company’s customers are encouraged to purchase from
locally approved vendors.
Being an engineering and construction company and
owing to the nature of its products and services, the
scope for direct product recycling is limited. However in
many of the projects executed by the Company, it has
provided retrofitting services to extend product life cycle
span. Company recycled materials amount to less than 5%
of its total material consumption.
In the construction businesses, alternate materials such as
fly ash in place of cement, crushed sand instead of natural
sand, blast furnace slag in road construction in place of
natural aggregate etc. are used. Through dedicated steel
centres, generation of steel scrap is minimized. During the
manufacturing process, zinc is recovered from zinc waste
and reused in plating operations.
27
An environment and social ‘Code of Conduct’, developed
for the supply chain, has been adopted by key suppliers.
The code propagates environment-friendly, occupational
health & safety and socially-responsible business practices.
The Company conducts capacity building programmes for
the supply chain, provides training and technical expertise
on various manufacturing and operational practices such
as value engineering, six sigma and lean manufacturing.
Systems are in place related to information security
management and confidentiality, and norms are followed
covering intellectual property rights.
Principle 3: Business should promote
well-being of employees
An organisation’s success is the aggregation of the
individual successes of its employees. The Company
believes a happy employee is a productive employee
who will, given a conducive environment, surpass his/
her industry peers. The Company’s achievements in
building plant and equipment of unmatched scale and
sophistication would never have been possible without the
wholehearted involvement of its employees.
The Company integrates HR practices with business
strategies to provide employees the opportunity to fulfil
their career aspirations and development needs. The
Company encourages its employees to think laterally and
nurtures a feeling of ownership.
No. of employees
(Standalone)
Refer “Standalone
Financials – 10 Year
Highlights” section of the
Annual Report
Number of permanent
women employees
2,635
Contract workmen
(predominantly at project
sites)
3,82,472
The Company has provided direct employment to 74
persons with disabilities. In addition, 110 such individuals
are employed within its value chain.
The Company practices and propagates equal opportunity
28
Health Check-up at Project sites
in employment and does not discriminate on the basis of
caste, religion, gender or handicap. The Company does
not employ any child, forced or compulsory labour, and
has similar systems in place for its contractors.
Occupational health and safety receives close and
continuing attention. Companies manufacturing units
are ISO 14001 and OHSAS 18001 certified. The policy
on ‘Protection of Women’s right at Workplace’ reflects
the Company’s commitment to provide a safe and caring
environment to female employees. The Company, being
predominantly in E&C business, engages a large number
of contract labour for its project activities. The Company
has recognized employee unions and associations at
manufacturing establishments which are affiliated to
different trade union bodies. The percentage of permanent
employees covered under this category is 8.79%.
The Company’s HR development team formulates a
wide variety of training programmes to nurture the
competencies of its employees. These interventions are
not limited to technical and functional domains; they
also encompass behavioural and managerial aspects. In
addition, programmes to enhance safety standards and
EHS competency building are a focus area.
A focussed initiative to build employee health and well-
being is in place. This programme creates awareness on
prevention of lifestyle diseases, encourages employees
to make positive health choices and builds a healthy
workplace. Similarly, several welfare initiatives such
as yoga, counselling, recreational and developmental
programmes are available to employees and their families
to promote work-life balance.
The Company has institutionalised many training
including a state-of-the-art Leadership
enablers
Development Academy at Lonavala near Mumbai.
Leadership Development Programmes (LDP), Management
Development Programmes
(MDP), Global Expat
Programmes, Project management, etc. are some of the
key development programmes.
In FY 2012-13, the Company’s permanent employees
received a total of 34,84,259 man-hours of safety and
skill-up-gradation training. All employees of contractors
receive mandatory safety training before entering the
Company premises.
No complaints relating to child labour, forced labour,
involuntary labour or sexual harassment were received in
the FY 2012-13.
Principle 4: Businesses should respect
the interests of, and be responsive
towards all stakeholders, especially
those who are disadvantaged,
vulnerable and marginalised
Such interactions with key internal and external
stakeholders help the Company to understand material
issues and evolve thrust areas for implementation.
The Company provides strategic social interventions by
working hand-in-hand with local NGOs and communities.
The details of such programmes are stated under Principle
8.
The Company’s Corporate Brand Management &
Communications department facilitates an on-going
dialogue between the organisation and its stakeholders.
Communication channels adopted include:
For External Stakeholders
For Internal Stakeholders
Stakeholders engagement
sessions
Client satisfaction surveys
Employee satisfaction survey
GALLUP Engagement Survey
for further improvement in
employees’ engagement
process
Regular business interaction,
supplier, dealer and stockist
meets
Circulars
Social initiatives
Welfare initiatives for
employees and their families
Online news bulletins to
convey topical developments
A large bouquet of print and
on-line in-house magazines -
some location specific, some
business specific
Periodic feedback
mechanism
Press Releases
AGM (Shareholders
interaction)
Investors meet and
shareholder visit to works
A corporate website that
presents an updated
picture of capabilities &
activities
Access to the business media
to provide information &
respond to queries
Shareholders visit Powai Campus
The Company is one of the most widely held companies in
India. Its shareholding is diffused, diverse and transparent,
and the Company is committed to delivering on their
individual expectations.
The Company has mapped its stakeholders as a part of
its stakeholder engagement process. Through community
need assessment surveys & engagements, the Company
has identified disadvantaged sections of society.
Introduced recently, the Company Infodesk, an online
service, provides a single point contact for information on
the Company’s products and services and other particulars
of the company to the external stakeholders.
29
Principle 5: Businesses should respect
and promote Human Rights
Principle 6: Business should respect,
protect, and make efforts to restore the
environment
The Company upholds the sanctity of Human Rights in
letter and spirit. It complies with applicable local laws
and regulatory requirements like conventions of the
International Labour Organisation (ILO), The Factories Act
1948, Building & Other Construction Workers (Regulation
of Employment & Conditions of Service) Act 1996, Central
Rules 1998, and Industrial Disputes Act 1947.
The Company does not permit child labour or forced labour
in any of its operations. Communication processes such
as induction training programmes, interactive sessions,
intranet, policy manuals and posters sensitize employees
on human rights. These are practiced in the Company and
extended to Subsidiary and Associate companies.
The Company is conscious of its role and responsibility
in protecting the environment, conservation of resources
and mitigating climate change & its impacts. It continues
to focus on efficient consumption of materials, energy
and water through structured and systematic approach.
The Company has a system in place to identify and assess
potential environmental risks and opportunities in its
operations.
The Company’s strong alignment with NAPCC is
demonstrated through initiatives for energy and
Greenhouse gas (GHG) emission intensity reduction,
L&T released a policy for the protection of women’s rights at the
workplace
Solar Photo Volatic (PV) power Plant commisioned by L&T
Diversity and equal opportunity are strategic and important
aspects of our work ethos. No employee is discriminated
against on grounds of gender, ethnicity, nationality,
sexual orientation, political and religious affiliation. The
Company’s environmental and social ‘Code of Conduct
for Suppliers’ also propagates Human Rights principles.
There were no reported complaints related to human
rights violations during the FY 2012-13.
increased use of renewable energy, promotion of green
building construction, and enhancement of green cover,
provision of solar & renewable energy solutions to
customers and building of capacity for environmental
management. The Company’s environment preservation
policy and initiatives are propagated within its Subsidiary
and Associate Companies and its key suppliers are also
encouraged to follow such practices.
30
Environmental
regulatory approvals precede
commencement of operations at units and project sites.
An internal compliance report is periodically reviewed in
businesses to ensure fulfilment of environmental and local
regulations. The Company regularly submits compliance
reports to Central Pollution Control Board (CPCB) / State
Pollution Control Boards (SPCB) as per the environmental
legal requirements. During the financial year, there are
no pending or unresolved show cause/legal notices from
CPCB/SPCB.
Wastewater treatment and reuse
Industrial and domestic wastewater is treated at Effluent
Treatment Plant (ETP) and Sewage Treatment Plant (STP)
based on state-of-the-art technology at the campuses of
the Company. Treated wastewater is used for gardening,
toilet flushing and for cooling tower applications as a water
conservation measure.
Details of efforts made for reconstruction of
biodiversity
The Company maintains a green cover and encourages new
plantation in and around all of its manufacturing facilities
and project sites. In the reporting period, the Company
planted over 265,000 saplings across its operations.
The campuses of the Company have over 150,000 fully
grown trees and around 35% of the available open land
at its manufacturing locations have a green cover. In the
reporting year, adequate care was taken to ensure that
the Company’s operations do not adversely impact the
biodiversity.
Recycled raw material
Most of the Company’s products are Engineered to Order
(ETO) and are made in line with stringent international
design and manufacturing codes as per the requirements
of the customers. Input materials meet specified conditions
and are tested for physical, chemical and other properties
before they are certified for use. It is, therefore, difficult to
use recycled input material for most of the product range.
In the construction business, Company promotes eco-
friendly technologies that continually replace natural
resources like sand, aggregates, cement, bricks and wood
with recycled material. Crushed sand is used in place of
natural sand, fly-ash partially substitutes cement and
Ground Granulated Blast Furnace Slags (GGBS) is used
in place of aggregates. In the production cycle, zinc is
recovered from the plating process and reused for coating
applications.
Sustainability roadmap
The Company prepared its short term sustainability targets
for 2009-12 and the progress is shared in the Corporate
Sustainability report along with the sustainability targets
for 2012-15. The focus is on:
• Energy Conservation
• Climate Change
• Water Conservation
• Material Management
• Safety
• Health
• Corporate Social Initiatives
(For more details please refer to
www.lntsustainability.com)
The Company has a registered project by its Infrastructure
Development arm (L&T IDPL) on Clean Development
Mechanism (CDM) under United Nations Framework
Convention on Climate Change (UNFCCC) related to
Green Power Generation Project (8.7 MW wind farm).
The National CDM Authority - Ministry of Environment
& Forests, Government of India has approved this as a
‘Project contributing to sustainable development’ and
given ‘Host country approval’ for the project on 12th June
2012. This project aims to reduce approximately 16,128
tonnes of CO2 equivalent per annum.
31
Principle 7: Responsible Public
Advocacy
The Company engages with policy making and regulatory
bodies through multiple business forums and trade
organisations. The Company’s senior executives participate
in the development of public policy that addresses issues
affecting industry, business, products and customers
through collaborative interactions.
The Company contributes to the policy-making process
through memberships of associations and forums. Some
such institutions are:
• Confederation of Indian Industry (CII)
• Federation of Indian Chambers of Commerce and
Industry (FICCI)
• Associated Chambers of Commerce and Industry of
India (ASSOCHAM)
• Bombay Chamber of Commerce & Industry (BCCI)
• Bureau of Indian Standards
• Construction Industry Development Council (CIDC)
• Indian Electrical and Electronics Manufacturers
Association
• National Safety Council
• Indian Institute of Chemical Engineers (IIChE)
• National Fire Protection Institution
• Association of Business Communicators of India
The Company’s senior executives have been closely
interacting with CII on focussed initiatives on Sustainable
Development and have been members of working
groups on energy efficiency, EHS and corporate social
responsibility of many industry chambers across India.
Principle 8: Support Inclusive Growth
Education: One of Thrust areas of L&T’s social initiatives
Company’ Ladies Clubs – a unique network of spouses of
employees. Larsen & Toubro Public Charitable Trust works
towards community welfare through its activities for the
underprivileged sections of the society.
Corporate Social Initiatives (CSI) of the Company
oversees implementation of social programmes across the
organisation in the following thrust areas:
• Mother & Child Health Care
• Education
• Skill Building
The Company collaborates with NGOs, local forums and
government bodies for programme management. These
programmes in the community are taken up as an outcome
of need-assessment surveys and community interaction.
The Company also conducts periodical evaluation of these
interventions for on-going improvements.
Communities are integral part of programme management;
their participation is built in through regular dialogue and
involvement. Many team members are drawn from the
beneficiary community, ensuring greater acceptance and
community participation.
A brief overview of the Company’s social portfolio is as
below:
The Company responds positively to emerging societal
expectations as a part of its Corporate Social Responsibility.
It invests in the growth of communities through a broad
spectrum of social interventions. These programmes are
undertaken at multiple levels - through the Company’s
units and project sites, employee volunteers and the
Education
The Company’s social interventions covering educational
initiatives are focused on providing primary education,
infrastructure development and enhancing the learning
experience for children in several schools in the vicinity of
its units across India.
32
The initiative also covers support to pre-schools, setting
up computer labs, providing teaching aids and uniforms
to the needy, capacity-building of teachers, organising
summer camps, sports activities and upgrading school
resources etc.
Presently, the Company supports over 147 schools across
India and reaches out to over 100,000 underprivileged
children.
Health
Around its establishments across India, the Company
actively contributes to the health and welfare of the
community. Major initiatives include setting up of health
centres with a focus on reproductive health, conducting
diagnostic and clinical health camps that support
maternal and child health care, immunization and health
education. The Company has seven community health
centres at Mumbai, Thane, Surat, Chennai, Coimbatore,
Ahmednagar and Kansbahal which provide health care for
the less privileged.
Skill Building
The Company draws on its domain expertise to fill skill
gaps in society, and contribute to a talent pool that will
benefit industry. Constructions Skills Training Institutes
(CSTI), set up by the Company, provide formal vocational
training in various construction trades to youth from the
weaker sections of society. CSTIs provide free training
in trades such as bar bending, formwork carpentry,
masonary, scaffolding and welding etc. The three months
training module enhances employability of underprivileged
youth and turns social dropouts into productive members
of society. The Company has set up 8 such CSTIs and
has collaborated with several ITIs and NGOs to impart
job-oriented training.
Construction Skills Training Institute (CSTI)
Vocational training programs in the areas of tailoring,
beautician, home-nursing and food processing for
women are also being conducted through the Larsen &
Toubro Public Charitable Trust. In addition, 100 check
dams have been constructed in the drought prone areas
of Maharashtra to facilitate irrigation and ground water
recharge for rural communities.
The Company contributed Rs. 73.04 Crores in 2012-13
towards social development.
Principle 9: Engage with and provide
value to customers
The Company’s strong customer orientation is widely
recognized. It enhances product value through continuous
investments in R&D, design, technology and through
customized solutions tailored to meet the specific needs
of its clients. The Company’s products and services take
into account safety and stringent quality standards. The
labelling process for products is implemented in line with
relevant codes, specifications and regulations. Providing
Operation and Maintenance manuals to customers is an
integral part of the Company’s business process. Products
are benchmarked against the best and conform to national
and international standards like IS, IEC and BIS.
The Company has a well-established customer feedback
mechanism which enables it to have regular interactions
with clients. These include regular customer meets,
periodic customer satisfaction surveys, market research
and training programs for client personnel. The quantum
of repeat orders received is an indicator of customer
satisfaction.
The Company adheres to all norms, standards and
voluntary codes related to marketing communications and
fair-trade practices including advertising, promotion, and
sponsorship.
There were no cases filed by any stakeholder against the
Company regarding unfair trade practices, irresponsible
advertising and/or anti-competitive behaviour in the last
five years, and there are no pending cases as on March
31, 2013.
33
Annexure: Mapping of Annual Business Responsibly Report (ABRR)
Question
Reference (AR – Annual Report;
BRR – Business Responsibility Report)
Section
Section A : General Information about the Company
1. Corporate Identity Number (CIN) of the Company
2. Name of the Company
3. Registered Address
4. Website
5. Email id
6. Financial Year Reported
7. Sector(s) that the Company is engaged in (industrial activity code-wise)
8. List three key products/services that the Company manufactures/provides
(as in balance sheet)
9. Total number of locations where business activity is undertaken by the
Company
i. Number of International Locations (Provide details of major 5)
ii. Number of National Locations
10. Markets served by the Company – Local/State/National/International
Section B: Financial Details of the Company
1. Paid up Capital (INR)
AR
(BRR Section)
AR
(BRR Section)
AR
(L&T Nationwide Network & Global Presence)
AR
(L&T Nationwide Network & Global Presence)
AR
(L&T Nationwide Network & Global Presence)
AR
(BRR Section)
2. Total Turnover (INR)
3. Total profit after taxes (INR)
AR
(Standalone Financials –10 Year Highlights Section)
4. Total spending on Corporate Social Responsibility (CSR) as percentage of
profit after tax (%)
5. List of activities in which expenditure in 4 above has been incurred: -
Section C : Other Details
AR
(BRR Section)
AR
(BRR Section)
1. Does the Company have any Subsidiary Company/ Companies?
AR (Management Discussion & Analysis Section)
2. Do the Subsidiary Company/Companies participate in the BR Initiatives
of the parent company? If yes, then indicate the number of such
subsidiary company(s)
3. Do any other entity/entities (e.g. suppliers, distributors etc.) that the
Company does business with; participate in the BR initiatives of the
Company? If yes, then indicate the percentage of such entity/entities?
[Less than 30%, 30-60%, More than 60%]
AR
(BRR Section)
AR
(BRR Section)
34
Question
Section D: BR Information
1. Details of Director/Directors responsible for BR
a) Details of the Director/Director
the BR policy/policies
• DIN Number
• Name
• Designation
b) Details of the BR head
• DIN Number (if applicable)
• Name
• Designation
• Telephone number
• e-mail ID
3. Governance Related to BR
Indicate the frequency with which the Board of Directors, Committee of
the Board or CEO to assess the BR performance of the Company. Within 3
months, 3-6 months, Annually, More than 1 year
Does the Company publish a BR or a Sustainability Report? What is the
hyperlink for viewing this report? How frequently it is published?
Section E : Principle-wise Performance
Principle 1: Ethics, Transparency and Accountability
Does the policy relating to ethics, bribery and corruption cover only the
company?
Does it extend to the Group/Joint Ventures/ Suppliers/Contractors/NGOs /
Others?
How many stakeholder complaints have been received in the past financial
year and what percentage was satisfactorily resolved by the management?
Principle 2 : Sustainable Products and Services
List up to 3 of your products or services whose design has incorporated
social or environmental concerns, risks and/or opportunities.
For each such product, provide the following details in respect of resource
use (energy, water, raw material etc.) per unit of product (optional):
Does the company have procedures in place for sustainable sourcing
(including transportation)?
Has the company taken any steps to procure goods and services from local
& small producers, including communities surrounding their place of work?
Reference (AR – Annual Report;
BRR – Business Responsibility Report)
Section
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(Directors Report, Annexure C,
Section F : Board Committees)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
35
Question
Reference (AR – Annual Report;
BRR – Business Responsibility Report)
If yes, what steps have been taken to improve their capacity and capability
of local and small vendors?
Does the company have a mechanism to recycle products and waste?
If yes what is the percentage of recycling of products and waste (separately
as <5%, 5-10%, >10%). Also, provide details thereof, in about 50 words
or so.
Principle 3: Employee Well Being
Total number of employees.
Total number of employees hired on temporary/contractual/casual basis.
Number of permanent women employees.
Number of permanent employees with disabilities
Do you have an employee association that is recognised by management?
What percentage of your permanent employees is members of this
recognized employee association?
Please indicate the Number of complaints relating to child labour, forced
labour, involuntary labour, sexual harassment in the last financial year and
pending, as on the end of the financial year.
What percentage of your under mentioned employees were given safety
and skill up gradation training in the last year?
Principle 4: Valuing Marginalised Stakeholders
Has the company mapped its internal and external stakeholders?
Out of the above, has the company identified the disadvantaged, vulnerable
& marginalised stakeholders?
Are there any special initiatives taken by the company to engage with the
disadvantaged, vulnerable and marginalized stakeholders.
Principle 5: Human Rights
Does the policy of the company on human rights cover only the company or
extend to the Group/Joint Ventures/Suppliers/Contractors/NGOs/Others?
How many stakeholder complaints have been received in the past financial
year and what percent were satisfactorily resolved by the management?
Principle 6: Environment
Does the policy related to Principle 6 cover only the company or extends to
the Group/Joint Ventures/Suppliers/Contractors/NGOs/others.
Does the company have strategies/ initiatives to address global
environmental issues such as climate change, global warming, etc?
36
Section
AR
(BRR Section)
AR
(BRR Section)
AR (Standalone Financials – 10 Year Highlights)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
Question
Reference (AR – Annual Report;
BRR – Business Responsibility Report)
Does the company identify and assess potential environmental risks?
Does the company have any project related to Clean Development
Mechanism?
Has the company undertaken any other initiatives on – clean technology,
energy efficiency, renewable energy, etc. Y/N.
Are the Emissions/Waste generated by the company within the permissible
limits given by CPCB/SPCB for the financial year being reported?
Number of show cause/ legal notices received from CPCB/SPCB which are
pending (i.e. not resolved to satisfaction) as on end of Financial Year.
Principle 7: Policy Advocacy
Is your company a member of any trade and chamber or association? If Yes,
Name only those major ones that your business deals with:
Have you advocated/lobbied through above associations for the
advancement or improvement of public good?
Principle 8: Inclusive Growth
Does the company have specified programmes/initiatives/projects in pursuit
of the policy related to Principle 8?
Are the programmes/projects undertaken through in-house team/own
foundation/external NGO/government structures/any other organisation?
Have you done any impact assessment of your initiative?
What is your company’s direct contribution to community development
projects - Amount in INR and the details of the projects undertaken.
Have you taken steps to ensure that this community development initiative
is successfully adopted by the community?
Principle 9: Value to Customers in responsible manner
What percentage of customer complaints/consumer cases are pending as on
the end of financial year.
Does the company display product information on the product label, over
and above what is mandated as per local laws?
Is there any case filed by any stakeholder against the company regarding
unfair trade practices, irresponsible advertising and/or anti-competitive
behaviour during the last five years and pending as of end of financial year
Did your company carry out any consumer survey/ consumer satisfaction
trends?
Section
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(BRR Section)
AR
(Directors Report, Annexure C,
Section F : Board Committees & BRR Section)
37
STANDALONE FINANCIALS-10 YEAR HIGHLIGHTS
Description
2012-13
2011-12
2010-11
2009-10
2008-09
2007-08
2006-07
2005-06
2004-05
2003-04
crore
Operational Indicators
Order inflow (including Integrated Joint
Ventures)
Order book (including Integrated Joint
Ventures)
Statement of Profit and Loss
88035
70574
80362
69519
51680
42561
31047
22383
14976
13259
153604
145723
130949
100412
70820
53555
37306
24875
17831
16973
Gross revenue from operations
61471
53738
44296
37356
34337
25342
17938
14995
13362
PBDIT^^
6407
6283
5640
4816
3922
2969
1784
1126
855
9889
566
Profit after tax (excluding extraordinary/
exceptional items)
Profit after tax (including extraordinary/
exceptional items)
Balance Sheet
Net worth
4695
4413
3676
3185
2709
2099
1385
863
631
533
4911
4457
3958
4376
3482
2173
1403
1012
984
533
29143
25223
21846
18312
12460
9555
5768
4640
3369
2775
Deferred tax liability (net)
242
133
263
77
48
61
Loan funds
Capital employed
Ratios and statistics
8834
9896
7161
6801
6556
3584
38219
35252
29270
25190
19064
13200
40
2078
7886
PBDIT as % of net revenue from operations @
10.53
11.82
12.84
13.00
11.56
11.87
10.14
PAT as % of net revenue from operations $
7.71
8.30
8.37
8.60
7.98
8.39
7.87
ROCE % *
RONW % **
14.60
17.29
15.09
15.03
15.92
18.52
18.77
18.33
20.73
24.67
21.12
28.21
20.71
26.84
77
1454
6171
7.63
5.85
16.70
21.88
95
1859
5323
6.50
4.80
14.63
21.05
114
1324
4213
5.87
5.53
14.40
20.66
Gross Debt: Equity ratio
0.30:1
0.39:1
0.33:1
0.37:1
0.53:1
0.38:1
0.36:1
0.32:1
0.56:1
0.49:1
Basic earnings per equity share ( ) #
79.99
72.92
65.33
73.77
59.50
37.80
25.11
Book value per equity share ( )
473.24
411.53
358.45
303.69
212.31
162.95
101.14
Dividend per equity share ( )
18.50
16.50
14.50
12.50
10.50
8.50
6.50
19.02
83.50
5.50
19.41
63.48
4.38
10.71
54.18
4.00
No. of equity shareholders
8,54,151 9,26,719 8,53,485 8,14,678 9,31,362 5,78,177 4,28,504 3,27,778 3,23,908 3,65,824
No. of employees
54,092
48,754
45,117
38,785
37,357
31,941
27,191
23,148
19,848
18,996
^^ Profit before depreciation, interest and tax (PBDIT) is excluding extraordinary/exceptional items and other income
@
$ Profit After Tax (PAT) as % of net revenue from operations = [(PAT excluding extraordinary/exceptional items)/(gross revenue from operations less
PBDIT as % of net revenue from operations = [PBDIT/(gross revenue from operations less excise duty)]
excise duty)]
* Return on Capital Employed (ROCE) = [(PAT excluding extraordinary/exceptional items+interest-tax on interest)/(average capital employed excluding
revaluation reserve and miscellaneous expenditure)]
Return on Net Worth (RONW) = [(PAT excluding extraordinary/exceptional items)/(average net worth excluding revaluation reserve and miscellaneous
expenditure)]
Basic earnings per equity share has been calculated including extraordinary/exceptional items
**
#
38
CONSOLIDATED FINANCIALS - 10 YEAR HIGHLIGHTS
Description
2012-2013 2011-2012
2010-2011
2009-2010
2008-2009
2007-2008
2006-2007
2005-2006
2004-2005
2003-2004
v crore
Statement of Profit and Loss
Gross revenue from operations
75195
64960
52470
44310
40932
29819
20877
16809
14717
11232
PBDIT^^
9859
8884
7677
4605
5008
3672
2120
1388
826
909
Profit attributable to group shareholders
(excluding extraordinary/exceptional items)
4911
4649
4238
3796
3007
2304
1810
1051
697
600
Profit attributable to group shareholders
(including extraordinary/exceptional items)
5206
4694
4456
5451
3789
2325
2240
1317
1050
747
Balance Sheet
Net worth
33860
29387
25051
20991
13988
10831
6922
4964
3316
2647
Deferred tax liability (net)
184
82
311
153
131
122
107
127
138
214
Loan funds
61994
47150
32798
22656
18400
12120
6200
3499
3454
2769
Capital employed
102644
82790
63697
46839
35547
24192
14107
8697
7013
5684
Ratios and statistics
PBDIT as % of net revenue from operations @
13.23
13.81
14.75
10.92
12.37
12.48
10.59
8.51
5.84
8.28
PAT as % of net revenue from operations $
6.59
7.23
8.14
9.01
7.43
7.83
9.04
6.42
4.92
5.47
RONW % **
15.54
17.10
18.43
21.75
24.32
26.68
30.71
25.78
23.96
21.24
Gross debt:equity ratio
1.83:1
1.61:1
1.31:1
1.08:1
1.32:1
1.12:1
0.9:1
0.71:1
1.06:1
1.08:1
Basic earnings per equity share (v) #
84.79
76.81
73.56
91.90
64.76
40.44
40.10
24.75
20.70
15.01
Book value per equity share (v)
549.89
479.46
410.95
348.06
238.27
184.31
121.39
89.36
62.44
51.58
Dividend per equity share (v)
18.50
16.50
14.50
12.50
10.50
8.50
6.50
5.50
4.38
4.00
^^
Profit before depreciation, interest and tax (PBDIT) is excluding extraordinary/exceptional items and other income
@
$
**
PBDIT as % of net revenue from operations = [PBDIT/(gross revenue from operation less excise duty)]
PAT as % of net revenue from operations = [(PAT excluding extraordinary/exceptional items)/(gross revenue from operation less excise duty)]
Return on Net Worth (RONW) = [(profit available for appropriation excluding extraordinary/exceptional items)/(average net worth excluding revaluation
reserve and miscellaneous expenditure)]
#
Basic earnings per equity share has been calculated including extraordinary/exceptional items
39
L&T - ORDER INFLOW
(INCLUDING INTEGRATED JOINT VENTURES)
L&T - GROSS REVENUE FROM OPERATIONS
L&T - PBDIT AS % OF NET REVENUE FROM OPERATIONS
L&T - INTEREST COVERAGE RATIO
L&T - PAT AND BASIC EPS
L&T - FIXED ASSET TURNOVER RATIO
40
L&T - SEGMENT-WISE ORDER INFLOW 2012-13
L&T - SEGMENT-WISE REVENUE 2012-13
L&T - SEGMENT-WISE RESULT 2012-13
L&T - SEGMENT-WISE EBIDTA MARGINS*
L&T - SECTOR-WISE ORDER BOOK
AS AT MARCH 31, 2013
L&T CONSOLIDATED GROSS REVENUE FROM
OPERATIONS AND PAT
41
Directors’ Report
The Directors have pleasure in presenting their Annual
Report and Accounts for the year ended March 31, 2013.
FINANCIAL RESULTS
Profit before depreciation, exceptional
and extraordinary items and tax
2012-13
crore
7,275.56
2011-12
crore
6,954.79
Less: Depreciation, amortization and
819.42
700.45
obsolescence
Add: Transfer from Revaluation Reserve
0.95
0.99
6,456.14
6,254.34
TRANSFER OF HYDROCARBON BUSINESS
The Board of Directors of the Company at its Meeting held
on May 22, 2013 has approved a Scheme of Arrangement
between Larsen & Toubro Limited and L&T Hydrocarbon
Engineering Limited, a wholly owned subsidiary of the
Company (“LTHE”) and their respective Shareholders
and Creditors which inter alia envisages transfer of the
Hydrocarbon Business undertaking along with related
assets and liabilities into LTHE and other consequential
matters under the provisions of Sections 391 to 394 of the
Companies Act, 1956. The Appointed Date of the Scheme
would be April 01, 2013. There would be no issue of Shares
by LTHE to the Shareholders of the Company pursuant to
transfer of Hydrocarbon business.
Profit before exceptional and
extraordinary items and tax
6,457.09
6,255.33
ISSUE OF BONUS SHARES
Add: Exceptional items
175.95
55.00
Profit before extraordinary items and tax
6,633.04
6,310.33
Add: Extraordinary items
78.11
–
Profit before tax
Less: Provision for Tax
Profit after Tax
6,711.15
6,310.33
1800.50
1,853.83
4,910.65
4,456.50
Add: Balance brought forward from
152.39
105.68
previous year
Less: Dividend paid for the previous
year (including dividend
distribution tax)
2.71
3.89
Balance available for disposal which the
directors appropriate as follows :
5,060.33
4,558.29
Debenture Redemption Reserve
Proposed Dividend
Dividend Tax
General Reserve
Balance to be carried forward
Dividend
The Directors recommend payment of
final dividend of
18.50 per equity
share of 2/- each on pre-bonus capital
of 61,53,85,981 shares.
YEAR IN RETROSPECT
50.25
44.00
1,138.47
1,010.46
85.86
101.44
3,500.00
3,250.00
4,774.58
4,405.90
285.75
152.39
1,138.47
1,010.46
63,322 crore as against
The gross sales and other income for the financial year under
55,076 crore for
review were
the previous financial year registering an increase of 15%.
The Profit before tax excluding extraordinary and exceptional
items was
6,457 crore and the Profit after tax excluding
extraordinary and exceptional items of 4,695 crore for the
financial year under review as against
6,255 crore and
4,413 crore respectively for the previous financial year,
registering an increase of 3% and 6% respectively.
To commemorate the occasion of the Platinum Jubilee of
the Company, the Board of Directors of the Company in
its meeting held on May 22, 2013, has recommended for
approval of the shareholders issue of bonus shares to the
holders of equity shares of the Company in the ratio of 1:2
(i.e. one bonus equity share of 2/- each for every two fully
paid up equity shares of 2/- each held). The approval of the
shareholders will be sought through postal ballot.
DIVIDEND
18.50
The Directors recommend payment of dividend of
per equity share of 2/- each on the pre-bonus share capital
which works out to
12.33 per share post issue of bonus
shares.
DEPOSITORY SYSTEM
As the members are aware, the Company’s shares are
compulsorily tradable in electronic form. As on March 31,
2013, 97.39% of the Company’s total paid-up Capital
representing 59,93,26,527 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 from
either of the Depositories.
CAPITAL & FINANCE
During the year under review, the Company allotted
29,87,082 equity shares upon exercise of stock options by
the eligible employees under the Employee Stock Option
Schemes.
During the year under review,
250 crores were raised by
the Company via issuance of Non-Convertible Debentures.
Further, the Company has drawn down long term foreign
currency loans in USD & JPY equivalent to approximately
2,660 crores.
42
During the year, the Company repaid a part of its long term
foreign currency loans, equivalent to about 1,615 crore.
CAPITAL EXPENDITURE
As at March 31, 2013, the gross fixed and intangible assets,
12,582 crore and the
including leased assets, stood at
net fixed and intangible assets, including leased assets,
at
8,902 crore. Capital expenditure during the year
amounted to 1,505 crore.
DEPOSITS
There are no deposits which were due for repayment on
or before March 31, 2013. All unclaimed deposits were
transferred to Investor Education & Protection Fund during
the year.
TRANSFER TO INVESTOR EDUCATION & PROTECTION
FUND
The Company sends letters to all shareholders whose
dividends are unclaimed so as to ensure that they receive
their rightful dues. Efforts are also made in co-ordination
with the Registrar to locate the shareholders who have not
claimed their dues.
During the year, the Company has transferred a sum of
73,11,898/- 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 was 10,63,57,861/- as
on March 31, 2013.
SUBSIDIARY COMPANIES
During the year under review, the Company subscribed to/
acquired equity shares in various subsidiary companies. The
details of investments in subsidiary companies during the
year are as under:
A) Shares acquired during the year:-
Name of the company
L&T Aviation Services Private Limited
L&T-MHI Boilers Private Limited
L&T-MHI Turbine Generators Private Limited
L&T General Insurance Company Limited
L&T Power Development Limited
L&T Shipbuilding Limited
L&T Special Steels and Heavy Forgings Limited
Larsen Toubro Arabia LLC
L&T Metro Rail (Hyderabad) Limited
No. of shares
2,16,00,000
71,40,000
4,61,55,000
9,00,00,000
43,70,00,000
81,86,30,000
6,66,00,000
7,500
9,30,000
Name of the company
L&T Technology Services Limited
Audco India Limited (see Note 1)
No. of shares
50,000
7,81,630
B) Shares sold/transferred/reduction in face value
during the year:
Name of the company
L&T- Sargent & Lundy Limited (under buy-back)
No. of shares
9,09,092
L&T Plastics Machinery Private Limited (See Note 2)
1,60,00,000
L&T Power Limited (See Note 3)
51,157
Note:
1. During the year, the Company acquired 50% stake
in Audco India Limited. With this acquisition, Audco
India Limited is now a wholly owned subsidiary of the
Company.
2. The Company has sold its entire stake in L&T Plastics
Machinery Private Limited during the year.
3. During the year, the face value of the share was reduced
from 30,000 per share to 10 per share.
The Ministry of Corporate Affairs (MCA), vide its circular
No. 2/2011 dated February 8, 2011, has granted general
exemption under Section 212(8) of the Companies Act,
1956, subject to certain conditions being fulfilled by the
Company. As required under the circular, the Board of
Directors has, at its meeting held on January 25, 2013, passed
a resolution giving consent for not attaching the Balance
Sheet of the subsidiary companies. We have also given the
required information on subsidiary companies in this Annual
Report. 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 uploaded 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 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
43
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.
BUSINESS RESPONSIBILITY REPORTING
SEBI, vide its circular CIR/CFD/DIL/8/2012 dated August 13,
2012, mandated the top 100 listed companies, based on
market capitalization at BSE and NSE, to include Business
Reponsibility Report as part of the Annual Report.
Accordingly as per Clause 55 of the Listing Agreement
with the Stock Exchanges, a separate section on Business
Responsibility Reporting forms a part of this Annual Report
(pages 22-37).
CORPORATE GOVERNANCE VOLUNTARY GUIDELINES
By complying with the provisions of the Companies Act,
1956 and Clause 49 of the Listing Agreement, the Company
is complying with all the major clauses of the Corporate
Governance Voluntary Guidelines, 2009.
We have reported in Annexure “C” to the Directors’ Report –
Corporate Governance, the extent of our compliance of the
Corporate Governance Voluntary Guidelines, 2009 under
the following heads:
1. Nomination & Remuneration Committee
2. Other Information
3. Audit Committee
4. General Shareholders’ Information
The Company has been one of the first engineering and
construction companies in India to publish its report on
Corporate Sustainability.
The activities carried out by the Company as a part of its
CSR initiatives are covered in the Business Responsibility
Reporting forming a part of this Annual Report. The detailed
Corporate Sustainability Report is also available on the
Company’s website www.larsentoubro.com.
DIRECTORS’ RESPONSIBILITY STATEMENT
The Board of Directors of the Company confirms:
i.
ii.
iii.
iv.
v.
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 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, 2013 and of the profits of
the Company for the year ended on that date;
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;
that the annual accounts have been prepared on a
going concern basis; and
that the Company has adequate internal systems and
controls in place to ensure compliance of laws applicable
to the Company.
DIRECTORS
During the year under review, Mr. Ravi Uppal, Whole-time
Director of the Company resigned with effect from
September 15, 2012.
Mr. V.K. Magapu, Whole-time Director of the Company
retired on September 30, 2012.
Mr. M. Damodaran was appointed as an Additional Director
with effect from October 22, 2012.
Mr. Vikram Singh Mehta was appointed as an Additional
Director with effect from October 22, 2012.
CORPORATE SOCIAL RESPONSIBILITY VOLUNTARY
GUIDELINES
MCA had released a set of guidelines on Corporate Social
Responsibility (CSR) in December 2009. The Company is
substantially complying with the guidelines laid down.
Mr. Thomas Mathew T., the Nominee Director of the
Company representing ‘Life Insurance Corporation of India’,
resigned with effect from November 19, 2012.
Mr. Sushobhan Sarker was appointed as the Nominee
Director representing ‘Life Insurance Corporation of India’
44
with effect from December 15, 2012 to fill the casual
vacancy caused by the resignation of Mr. Thomas Mathew T.
Mr. Subodh Bhargava, Mr. Shailendra Roy, Mr. R. Shankar
Raman and Mr. M. M. Chitale retire from the Board
by rotation and are eligible for re-appointment at the
forthcoming Annual General Meeting.
Mr. M. Damodaran and Mr. Vikram Singh Mehta, Additional
Directors of the Company hold office up to the date of the
forthcoming Annual General Meeting and are eligible for
appointment.
Mrs. Bhagyam Ramani, Nominee of General Insurance
Corporation of India, resigned w.e.f. May 8, 2012. Mrs.
Bhagyam Ramani would have been liable for retirement by
rotation in ensuing AGM. The said vacancy is not proposed
to be filled at the ensuing AGM.
The notice convening the Annual General Meeting includes
the proposal for appointment/re-appointment of Directors.
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 (S&T), 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.
S&T has submitted the Peer Review Certificate dated
September 21, 2010 issued to them by Institute of Chartered
Accountants of India (ICAI).
COST AUDITORS
Pursuant to the Cost Audit Order dated January 24, 2012
issued by the Ministry of Corporate Affairs (MCA), the Board
of Directors has appointed M/s. R. Nanabhoy & Co., Cost
Accountants, as Cost Auditors for audit of cost accounting
records of “Engineering machinery (including electrical and
electronic products)”, for the Financial Year ended March 31,
2013. The appointment has been approved by the Central
Government.
The Report of the Cost Auditors for the Financial Year ended
March 31, 2013 is under finalization and will be filed with
the MCA within the prescribed period.
Based on the Audit Committee recommendations, the
Board of Directors at its meeting held on May 22, 2013,
has approved the re-appointment of M/s. R. Nanabhoy &
Co. as the Cost Auditors of the Company for the Financial
Year ending March 31, 2014, for applicable Product Groups
covered under MCA Cost Audit Order No. 52/56/CAB-2010
dated November 6, 2012. The appointment is subject to
approval of the Central Government
ACKNOWLEDGEMENT
Your Directors take this opportunity to thank the Financial
Institutions, Banks, Central and State Government
authorities, Regulatory authorities, Stock Exchanges and all
the various 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.
For and on behalf of the Board
A. M. Naik
Group Executive Chairman
Mumbai, May 22, 2013
45
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
Equipment and Systems
Installation of energy saving devices for lighting.
Installation of Roof Top Solar PV system in various
locations such as CSTI, Kanchipuram and in Hazira
Campus.
Re-engineering-Change in Design of BEMCO
Bending machines resulting in power saving by
20%
Modification in Process Design in Rolling mill
in Puducherry factory reducing the power
consumption by 1390 kWH/ day
Replacement of Mercury vapour lamps with
Induction lamp fittings in the factory premises
leading to consumption of less energy and giving
more illumination as well as assisting in maintaining
power factor to unity.
Interconnection of air compressor line of MV mod-2
with LV module & MV mod-1.
Single Switch Control in Fabrication shop & Stores.
Power generation from the existing solar system.
Optimized use of AC & FSD at Vadodara campus.
Retrofitting of LED lights.
Installation of Bio Mass plant for Power generation
and Solid Waste management.
Introduction of VSD based compressor at FORM
Work factory Unit-II at Karasur, Puducherry
resulted in 120% saving from the existing standard
compressor
Installation of CFL lamps and T5 fittings instead of
Metal halide lamps
Pillar drilling machine limit on/off operation.
Installation of P20 Energy saver panel for street
lighting.
Oxsilan process pretreatment plant
phosphating process) in paint shop.
(Cold
Installation of Solar air heating system.
Installation of 1.5kW and 2.4kW Solar standalone
systems/sodium vapour lamps for street lighting.
Installation of High Lumen/per watt Induction lamp
for shop floor.
Substitution of power taken from the grid for its
operations by the energy generated by the wind
mills installed by the Company.
Implementation by factories of ISO 50001 – Energy
management systems which will help in measuring
and improving the energy usage.
Reduction of primary energy consumption of High
speed diesel oil and Furnace oil by changing the
process to LPG firing which is an environment
friendly fuel.
Controlling all exhaust fans at Pithampur factory
(300W x 20 Nos.) through timer thus reducing their
operation by 50% and resulting in Energy Saving
of 936 KW per Annum.
Replacement of Incandescent lamps, Tube lights
and CFL lamps with LED lamps in office & on shop
floor for hand lamps and machine lamps.
Installation of occupancy sensors in offices & shops
for auto switch-off.
Use of Variable frequency drive in motors for
welding positioners, EOT cranes, AHU, Water
pumps, Welding trolleys, Rotary table & Machine
tools to improve the motor efficiency.
Installation of AC Drive for Turn Table.
Introduction of inverter based welding systems (3
nos) for SAW booms.
Use of magnetic resonators for improving the
efficiency in fuel consumption of Vapor Absorption
Machine (VAM).
Conversions of DC drive to AC drive in Asquith
Machine.
Installation of Smart Energy Saver in 840D system
on CNC machine.
Provided energy efficient cooling tower in place of
old cooling tower in big rolling machine.
Modification of PLC program in SIRMU DHD
Machine between 2 drilling cycle.
Use of energy savers and programmable on/
off switch for optimization of air conditioner
operations in SBU VRF.
46
Installation of Liquid Desiccant Dehumidifier in new
DFE for HVAC.
machines will get OFF, while welding operation is
suspended.
Special Purpose Machine for Composite Canister
machining to achieve 75% energy saving.
Shifting to Cyclone type Dust extraction system for
Composite Machining
Vibration analysis for better transmission efficiency
of rotary equipment.
Load sharing of high frequency generator in shops.
Use of Timers & efficiency check for HVAC and
Street Lighting to conserve energy.
Installation of solar pipes & solar water heaters to
reduce use of conventional energy.
Installation of Bio toilets (designed by DRDO) to
conserve energy on sewage treatment.
Installation of transparent sheets & sky light panels
on shop sides for using day light which obviates use
of hand lamps during day time.
Installations of turbo ventilators for shop floor
roofs.
Rationalizing the operational time period and
temperature of office ACs.
Optimizing use of mobile cranes for material
handling for reducing HSD consumption.
Split ACs in place of Centralized AC in locations
which are not used throughout the day.
Use of 62.5 KVA DG set for continuous operation in
ESS Test facility when required instead of 400 KVA
DG set provisioned by the building owner thereby
saving energy.
Use of smart metering system for optimum use of
energy.
Installation of Energy saver in one Lighting High
Mast and successfully achieved 17% Energy Saving.
Same concept is planned for other High Mast Tower
in the yard in phased manner for other illumination
systems.
Introduction of double circuit in High mast
light towers to reduce illumination and power
consumption during non-working hours.
Installation Auto temperature controller with the
use of VFD and PID controller in HVAC of MFF EPC
Block.
Replacement of diesel operated Shot blasting
equipments with efficient Electrical operated
Blasting Equipments.
Installation of presence sensors/occupational
sensors in porta offices, rest rooms, etc. to control
operation of lights and AC.
Appointment of MR and formed the core team for
implementation of Energy Management System:
ISO 50001 with an objective to get the certificate
for MFF in 2013-14.
Replacement of ETP blower with new efficient
blower.
Installation of separate switches for lighting
in Group-II building so as to ensure optimum
utilization of power.
Installation of centralized Compressed Air
Management System to optimize the generation
of compressed air.
Observing ‘Walk-to-Work’ day on 2nd Saturday of
every month at Kansbahal.
Observed ‘Earth Hour’ during March 2013 at
Kansbahal.
Initiatives by Foundry Business Unit (FBU) such as
IMF Mixers running time reduced from 15 minutes
to 5 minutes, conversion of Shot blasting M/c
Bucket Elevator & Rotary Screen from contactor
to Drive unit resulting in energy saving of 15%,
interlocking of GK Shake out OBMS with feeder
reducing Idle running time, reduction in peak hour
power consumption and shifting production to
night shift for gaining Night Hours rebate of 5%,
etc.
Initiatives by Rubber Processing Machinery Unit
(LTRPM) such as Occupancy sensors provided in Shop
floor cabins, Operation of 232 CFM compressor in
3rd Shift instead of 432 CFM compressor, etc.
Initiatives by Valves Manufacturing Unit (VMU) such
as Saving of Energy by switching of Hyd. Power
pack during Idle running of machine, installation
of Lower capacity Cranes, provision of Auto Off
for water pump, procurement of HSD from an
alternate source, connection of STP water line to
Garden water sump for Sprinkler system, etc.
Calibration of contractor welding rectifiers to
ensure working of Energy Saver, so that welding
Initiatives by Construction & Mining Business
(CMB) such as installation of light sensitive sensors
47
at Bahadurgarh, efficient use of natural light at
workshop at EMS service station at Kanchipuram,
etc.
2
Improving energy effectiveness/efficiency of
Manufacturing Processes
Installation of new servo drive systems in SKZ &
MKVTL machines.
Installation of IR heating system for preheating
thereby reduction of PNG consumption.
Revamping of PH furnace resulting in reduced cycle
time & PNG consumption.
Introduction of CNG conversion kits in petrol driven
wagons.
Eliminate the throttling and reduce the speed of
VFD in 300 MT & 125 MT Boogie air supply blower.
Reduce specific power consumption from 0.30
KW/CFM to 0.18 KW/CFM, by refurbishment &
overhauling of Messer Plasma CNC cutting m/cold
Messer and HFS-4B Compressor.
Purchase of Green Power from third party to reduce
the carbon footprint.
Use of Biogas plant to reduce the canteen waste.
Development of manufacturing & machining
process for Rod baffles (Reliance PTA).
Use of bolted type blanks in place of welded blanks
for pneumatic & Helium leak testing of Dry Shielded
Canister.
Replacement of rolled section/ pipes by Centrifugal
& Investment casting for Refinery internals.
Extensive use of advance metal cutting process
like water jet, laser cutting & nibbling to eliminate
milling/drilling/slotting & grinding operation.
Edge beveling of SS plates by stacking multiple
plates together.
Standby mode for the shop overhead cranes and
climatic chambers
Programmable on/off
Environmental Stress Screening chambers.
switching
for all
Remote Monitoring of All Climatic chambers to
avoid emergency Power Drainage.
48
Controlled & Continual DM water flow for climatic
Chambers for Damp Heat Test.
Design optimization and rationalization of the
number of ovens required for electrode baking
and storage.
Batch-wise loading of jobs in Heat Treatment
Furnace instead of piece meal basis to conserve
energy.
(b) Additional investments and proposals, if any,
being implemented for reduction of consumption
of energy:
Implementation of ISO 50001 (Energy Management
System).
Implementation of Platinum rated green building ‘West
Block’.
Installation of DC power source Auto OFF manual ON
system in SAW in all the power sources.
Thermography of curing ovens and freezer.
Replacement of existing motors with High Efficiency
motors (EFF1/EFF2).
Replacement of existing transformers with energy
efficient distribution transformer.
Drip irrigation for newly developed Garden area, to
conserve energy of water pump & save water.
Biogas plant at the Canteen & Garden waste disposal.
(c)
Admin Building Terrace repainting with Heat shield paint
for reduction in HVAC load.
Installation of Wind turbines in shop floor instead of
electrical exhaust fans.
Budgeted for further replacement of CFL, MHL with LED
lighting & Installation of occupancy sensors. Installation
of solar street lights in LTRPM leading to annual energy
savings of 1903 KWH/Year consumption of energy.
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, cost of power consumption, energy savings
and reduction in maintenance cost, reduction in carbon
dioxide emissions & processing time/cycle time.
(d) Total Energy Consumption and Energy
Consumption per unit of production as per
Form A in respect of industries specified in the
Schedule:
FORM A
FORM FOR DISCLOSURE OF PARTICULARS WITH
RESPECT TO CONSERVATION OF ENERGY
A. POWER & FUEL CONSUMPTION
FOUNDRY
Reporting
Year
2012-13
FOUNDRY
Previous Year
2011-12
258.492 L
KWhr
261.247 L
KWhr
1,734.95 L
1,519.72 L
6.71
(Average)
5.82
(Average)
1. Electricity
(a) Purchased Unit
Total amount
Rate/Unit
(b) Own generation
(i) Through diesel
generator
Unit
4.2387L KWHr
2.35 L KWHr
FOUNDRY
Reporting
Year
2012-13
FOUNDRY
Previous Year
2011-12
8,984 Tons
–
KWH/Ton
2,060.02
–
14,694 Tons
–
KWH/Ton
1,735
–
41.43 Ltr/Ton
–
NIL
NIL
43.80 Ltr/Ton
–
NIL
NIL
A. Consumption per unit of
production Stands (if any)
Products (with details) unit
Casting
Ferro Alloy
Electricity
Casting
Ferro Alloy
H S D
Casting
Ferro Alloy
Coal (specify quality)
Others (specify)
[B] TECHNOLOGY ABSORPTION:
Efforts made in technology absorption as per Form B.
FORM B
(Disclosure of particulars with respect to Technology
Absorption)
Unit per ltr. Of diesel oil
3.33 Units
3.10 Units
RESEARCH AND DEVELOPMENT (R&D)
Cost/unit
13.17
12.75
1. Specific areas in which R&D carried out by the
(ii) Through steam
turbine/generator
Unit
Unit per ltr. of fuel oil/
gas
Cost/unit
2. Coal (specify quality and
where used)
Quantity (tons)
Total cost
Average rate
3. H S D
Quantity (k.ltrs.)
Total amount
Average rate
4. Others/internal generation
Quantity (k.ltrs.)
Total cost
Rate/unit
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
NIL
372.17
235.509 L
63.28/Ltr
643.22
265.14 L
41.22/Ltr
NIL
NIL
NIL
NIL
NIL
NIL
Company:
The Company has well-established R&D facilities for
carrying out applied research in the areas of Chemical
Engineering, Material Science & Corrosion, Thermal
Engineering, Machinery & System Engineering,
Mechanical Engineering and Water Technologies.
Research work is currently focused on the following:
Process engineering for Oil & Gas and Chemical Plant
applications; Ammonia/Urea processes for Fertilizer
sector; Offshore and Onshore Gas Processing
technologies; Process simulation for Refineries and
Chemical industries; Coal Gasification Technologies
for Process Plant and IGCC applications; Use of
Refinery Residue for Gasification application;
Process Technologies for Petrochemicals (PX/PTA)
and Polymers (PE/PP); Refractory Engineering for
high-temperature processes.
Material selection/verification and suggestion for
alternative materials; Material characterization
techniques for Oil & Gas, Fertilizer, Chemical and
Petrochemical applications; Surface treatment and
process qualification of coatings and plating after
49
surface modification for functional and corrosion
resistance properties; Identification and evaluation
of corrosion/material degradation mechanisms and
implementation of corrosion control measures;
Trouble-shooting and failure analysis; Advanced
material development and application of emerging
materials (such as nano and composites) for
strategic applications.
Design, analysis and optimization of Thermal and
Fluid systems; Computational Fluid Dynamics
(CFD) studies for troubleshooting and design
optimization; Dynamic Simulation of power plants;
Energy storage and recovery systems; Super Critical
Boilers; Non-conventional energy sources.
Advanced engineering support for rotating
machinery and systems in Oil & Gas, Process
and Power industries; Vibration and Acoustic
technologies for fault diagnosis; Noise Assessment
of Factories, Process Plants, Pipelines, Substations
and Offshore Platforms using Noise Mapping
Technique; Machinery design and optimization
using advanced Finite Element techniques; Rotor-
dynamic analysis of turbo-machinery; Tribology of
Gears, Bearings and Lubrication systems; Testing
and performance assessment of turbo-machinery;
Plant Reliability studies; Flow and Acoustic Induced
Vibration studies for pipelines.
Stress analysis for Equipments, Structures and Piping
systems; Advanced engineering analysis involving
Creep, Fatigue, Shock/Impact and Thermal effects;
Non-linear and Transient analysis techniques;
Composite Analysis of complex industrial plants;
Capability development in FFS (Fitness for Service)
studies; Experimental stress analysis.
Water Management solutions; Water, Wastewater
& Effluent treatment and recycling plants; Oil
Water Separation technologies; Desalination
technologies; Bench-scale and pilot plant studies
in Water Technology; Corporate Sustainability &
Management of Environmental issues.
Chemical Engineering
Design, analysis and simulation of chemical
processes and equipment, with special emphasis on
Gas Processing applications (Gas/Liquid Separation,
Gas Dehydration and Gas Sweetening Units);
Capability development in process simulation for
Ammonia and Urea Plants; Process Engineering for
Gas Compressor Modules; Technology Evaluation of
Air Separation Units; Flow simulation studies for Oil
& Gas Projects; Refractory engineering for Fertilizer
and Refinery Plant equipment; Modeling and
process simulation of fixed bed and entrained bed
Coal Gasifiers; Failure analysis and troubleshooting
of various process units; Solid handling processes
in Petrochemical applications.
Material Science & Corrosion Engineering
Material selection, verification and characterization;
Risk assessment for corrosion damage; Adequacy
check of material for RLA (Residual Life Assessment)
studies in various Oil & Gas Projects; Failure Analysis
studies for components (such as waste heat
recovery system, heat exchangers, thrust plates for
pulverizers, components of various equipments,
fasteners, fittings, coatings etc.); Reverse
engineering and material development support for
Defence equipment; Preservation and restoration
techniques for critical systems; Cathodic protection
system for marine vessels; Eco-friendly corrosion
inhibitors; Chemical cleaning/surface engineering
of metals and non-metals; Characterization of
composites with state-of-art instrumentation;
Nano-materials for strategic applications.
Thermal Engineering
Application of CFD technique in design optimization
and troubleshooting of equipment and systems
(such as flare and exhaust stack, gas dehydration
and gas sweetening units, multi-phase separators);
Safety studies for safe helideck operation at
offshore platforms; Radiation and dispersion
analysis; Failure analysis for false ceiling in AC
room; Risk analysis for simultaneous heavy lift and
installation of offshore platform along with drilling
operation; Check-rating and design optimization
of waste heat recovery coils and heat exchangers;
Support for commissioning of boiler, offshore well
head platform and process platform; String Testing
of Process Gas Compressor modules for Offshore
Platform; Failure analysis and troubleshooting
involving heat exchangers, boilers, heaters and
furnaces; Conjugate heat transfer analysis for
post-weld heat treatment; Troubleshooting of RG
Boiler for noise and vibration; Low-temperature
thermal desalination processes; Design of cored
brick heater; Design of HVAC system for offshore
platform; Dynamic Simulation study of sub-critical
and supercritical power plants.
Machinery & System Engineering
Advanced engineering studies in Vibration
and Acoustics for machinery and piping; Stress
analysis and design optimization of rotary
50
absorber unit; Dynamic stress analysis of piping
network in Refinery Complex considering flow-
induced and acoustic induced vibration; Design
of acoustic insulation for critical piping system;
Troubleshooting of machinery vibration problems
in high-speed pumps, turbines, motors, drive
gearboxes and compressors; Troubleshooting of
Deck Cranes at offshore platforms; Plant noise
assessment for Refinery Complex, Gas Gathering
Station and Sub-station; Product development/
design optimization studies for Coal Pulverizer
units for Supercritical Boilers; String test of PGC
Modules; Technical support during Acceptance Test
and Commissioning for critical machinery.
Mechanical Engineering
Design solutions for critical equipment through
advanced Finite Element Analysis; Fitness For
Service (FFS) assessment of in-service equipment
and structures containing damage or flaws;
Thermal-Structural composite analysis of systems
integrating equipment, piping and structure;
Advanced analysis (such as Boat Impact and
Pushover Analysis) of offshore jacket structures
involving high orders of non-linearity; Buckling
analysis of sub-sea pipelines; Fatigue analysis
of critical joints of offshore jacket structures;
Structural analysis of floating offshore structures
such as semi-submersibles and spars; Experimental
stress analysis of critical offshore equipment such
as pedestal deck crane and Blow Out Preventer
(BOP) lifting cradle during load testing.
Water Technologies
Total water management solutions including
technology evaluation, design & detailing of water/
wastewater facilities for Oil & Gas – Upstream &
Mid & Downstream sector; Focus on advanced
treatment technologies such as Sea water/
Brackish water Thermal Desalination, Membrane
Bioreactor, Sequential Batch Reactor, Up-flow
Anaerobic Sludge Blanket Reactor etc.; Oil-water
Separation processes; Waste minimization/
recycling techniques; Methodologies for achieving
Zero-discharge from plants; Testing-facilities for
water & wastewater characterization; Lab-scale
pilot plant studies for treatability aspects of water
and wastewater.
Development of high strength non-shrink grout for
precast panel wall applications.
Development of Ultra High Performance Concrete
(UHPC) above M100.
Development of light weight concrete for infill
applications in buildings.
Studies on precast panel connections.
Evaluation of composite pavements of high speed
corridor using falling weight deflectometer.
Development of cost chemical modified bitumen.
Development of alternate cold mix for pothole
repair.
Development of indigenous Creep testing facility.
Alternate arterial road construction with Modified
sub-base layers.
Micro-grid project in progress at L&T Construction
campus, Chennai for documenting the stability and
reliability of power system using multiple power
sources and advanced control system for source
and load control.
Test-beds involving different technologies of Solar
Photovoltaic (PV) modules and Balance of Plant
systems planned across various Construction Skills
Training Institutes (CSTIs) of L&T Construction.
Development of welding Simulation Technology.
Development of Steam Generator & Moisture
Separator for Nuclear Power Plant.
Development of LNG vaporizer.
Development of cyclone separator for FCC
regenerator in refinery.
Weapon Launch Systems – Structures, Mechanisms,
Stabilization Systems, Drives & Control Systems
Field & Air Defence Guns – Ballistics, Mechanisms,
Fire Control Systems, Optronics
Robotics & remotely operated/unmanned systems
RF, Microwave & telemetry systems
Video Analytics
Composites – Design & Process Technologies
Development of High Mach number wind tunnel
facility including various subsystems
Development of Titanium Structure for Strategic
programs.
Development of Dry Shielded Canister for Boiling
water type Nuclear Reactor
51
Development of Retort for Titanium Sponge Plant
Indigenous development of
SPM for Composite Canister machining. This
results in eliminating use of Heavy Boring
& Radial Drilling machines and reducing
machining cycle time by 90%.
7 Axis Machine for Ultrasonic Testing of
Composite Air Frame 3D profile – Cycle time
reduction by 70 %
Heavy duty lathe with dual Carriage & Tool
post to reduce machining cycle time by 40%.
Development of ion-mobility spectroscopy (IMS)
based chemical agent monitors (CAM).
Development of military communication hardware
Radio Relay
Field Wireless system
Vehicle Intercom System
Communication N/W field deployable router
Development of new products by LTRPM such as:
82.5” MECHANICAL PRESS
95” MECHANICAL PRESS WITH VCL
118” MECHANICAL PRESS WITH TOP SMO
118” MECHANICAL PRESS WITH BOTTOM
SMO
TYRE BUILDING MACHINE 12”-18”
51” HYDRAULIC TCP WITH VCL & SMO
INTEGRATED AUTOMATION SOLUTION for
Non-Tyre industry
Developments by VMU such as:
Development and supply of Bellow Sealed
Butterfly Valves for high vacuum applications
in BARC projects
Design & Development of Control Valves and
Actuators
Design & Development of Double Block and
Bleed high integrity positive shut off valves
for variety of applications including Leased
Automated Custody Transfer (LACT), Product
metering, Aviation & Military fuelling, product
isolation, bleeding, multi product manifolds
and tank storage
52
Design & Development of Containment
Isolation Valves, Bellow Seal Instrumentation
Valves for Indian Nuclear Power Plants
Design & Development of Quick Closing Non
Return Valves for Supercritical Power plants.
Design and establish manufacturing process
for development of large size high pressure
valves in forged steel construction.
R&D Laboratories in the areas of Vibration & Acoustics,
Experimental Stress Analysis, Materials Technology,
Corrosion Studies and Water Technology have
been upgraded by addition of new, state-of-the-art
instruments and software tools to carry out the above
studies effectively.
The research facilities are augmented with the latest
computer workstations, operating systems and
communication network/data storage facilities. A
fully computerized Technical Library, having the latest
technical publications, research journals and product/
technology databases further supplement the R&D
resources. Emphasis is given on creating Intellectual
Properties (IP) and managing the Intellectual Property
Rights (IPR).
The Electrical & Automation (E&A) business’s in-house
R&D has design and development capabilities for its
products and solutions that are among the best in the
industry. These facilities, located at Powai-Mumbai,
Ahmednagar, Mysore and Coimbatore, are approved
by the Department of Scientific & Industrial Research
(DSIR), Ministry of Science & Technology. The Switchgear
Design & Development Centre (SDDC) is the product
and technology development wing of E&A and supports
its leadership position in the market through proven
excellence in product design.
E&A’s engineers network with International labs, testing
centres and academic institutions to keep abreast of new
technology trends and introduce those for customers in
different segments. Focused R&D activities have enabled
the Electrical Standard Products (ESP) business to have a
healthy New Product Intensity (NPI) index of >30%-an
index which measures the sales of products introduced
in the market in last five years to the total sales in the
financial year. Currently, more than 400 engineers
are pursuing these activities and working on diverse
projects.
In FY14 major new product development programs
have been initiated by E&A in Powergear, Controlgear,
Final Distribution Products and LV Panels and Systems.
The new products being developed, in addition to
setting global benchmarks in the industry, would also
address the needs arising from the increased use of non-
conventional energy sources in the future. A greater
emphasis has been given to environmental friendly
design concepts – in terms of material consumption,
use of environmental friendly raw materials & processes
as also energy usage. The culmination of these
development programs is expected to give a cutting
edge to the product portfolio and enhance the market
share and profitability.
In addition to these, life cycle management programs
for product upgrades based on customer feedback,
new applications and changing competitive scenario
have also been initiated. This will help the businesses
to address different market segments and certain niche
applications.
The above initiatives will help businesses maintain
technology control and have a contemporary product
portfolio.
The Electrical & Automation (E&A) business is confident
of higher growth with the Utility segment indicating
increased activities along with revival in the Building
segment in GCC region. Africa has become a destination
of new opportunities. Prospects of turnkey automation
projects are improving and opportunities in the energy
management segment should contribute to better
growth for automation products and solutions.
2. Benefits derived as a result of above R&D:
In-house testing facility is created as import
substitution.
Reliable test results and timely delivery of test
results.
Sustainable product and environment friendly.
National standards improvement.
Alternate methods of construction have the
potential to reduce the consumption of natural
materials.
Indigenization & development of products for
Indian Defence sector.
Indigenization & development of products for
Indian Space sector.
Indigenization & development of products for
Indian Nuclear sector.
Requirements of IMS CAM for Homeland security
and Indian Defence with prospects of large order
inflow.
The R&D efforts from LTRPM helped them to
compete with international competitors on their
range of machines (Mechanical, Hydraulic Presses,
Tyre building machines and Tyre handling system).
In case of VMU, benefits were as follows
Establishment of indigenous expertise in
development and supply of high pressure valves
for supercritical applications. Establishment of
manufacturing cycle for development of large
size valves in forged steel construction
Successful supply of valves to BARC projects as
import substitution
Successful in-house development of Nuclear
Valves and Control Valves
Complete process simulation, design solutions
and optimization for Hydrocarbon projects in the
Fertilizer sector, involving Reformers, Ammonia
Plant and Urea Plant.
Establishment of in-house capability in Process
Simulation and FEED Verification of on-shore / off-
shore Gas Processing Plants and design optimization
of associated equipment.
In-house expertise for complete Refractory
solutions (e.g., material selection, engineering,
commissioning and troubleshooting) in high-
temperature equipment for process plants.
Development of in-house capability in multi-phase
flow simulation studies for Oil & Gas Projects.
Successful testing/commissioning of plants and
equipment in various Hydrocarbon projects,
through multi-disciplinary technology support.
Approximately two thirds of ESP business and
almost the whole of the LV panel business come
from products and systems which are designed and
developed in-house.
Complete support to business units for all Materials
related assignments (such as material verification/
selection/evaluation/characterization; selection of
alternative materials; failure analysis; preservation
and corrosion protection of critical equipment;
development of new materials for strategic
applications, identification of newer technologies
and commercially available proven products and
their implementation).
Development of in-house expertise related to
manufacturing processes, welding, heat treatment,
failure mechanisms and corrosion protection/
preservation issues of equipment having special
metallurgy for critical Oil & Gas applications.
53
Acquisition of know-how pertaining to special
materials and their applications.
Successful troubleshooting/design optimization of
Oil & Gas Processing equipment, heat exchangers,
flares and exhaust stack etc.; Dispersion and
radiation studies for offshore platform; Safety
studies for safe helideck operation; Risk analysis
for simultaneous heavy lift installation and drilling,
using advanced CFD technique; Design and check-
rating of critical thermal equipment for heat
exchange/heat recovery applications; Capability
development in newer applications such as low-
temperature thermal desalination, design of cored
brick heater; Design of HVAC system for offshore
platform; Evaluation of technology proposals on
cold fusion and geothermal power generation.
Establishment of in-house capabilities in analysis
of piping system for flow-induced and acoustic-
induced vibrations; Conduct of Plant Noise studies
utilizing in-house expertise; Development of
in-house capabilities in special acoustic studies
such as piping insulation design and valve noise/
vent noise assessment.
Development of in-house expertise in advanced
FEA and fatigue analysis techniques for specialized
systems (Orifice Chamber/associated piping); Design
upgrade and optimization of coal pulverizers.
Successful completion of failure analysis/
troubleshooting assignments for critical machinery;
Technical support to business units for machinery
acceptance testing and commissioning.
Development of in-house expertise in Fitness
for Service (FFS) Level 1 & Level 2 assessment of
in-service equipment and structures.
Establishment of in-house expertise in structural FE
analysis of offshore floating structures.
Establishment of in-house capability in composite
analysis of complex systems involving equipment,
piping and structures; Design methodology for
advanced FE analysis involving non-linear effects,
shock/impact, thermal fatigue and high-pressure/
high-temperature processes.
Development of in-house expertise in specialized
applications such as buckling analysis of sub-sea
pipeline and boat impact studies.
Technical support to Oil & Gas, Refinery,
Chemicals & Fertilizer Projects for complete
Water and Wastewater management solutions;
Produced Water Injection Water and Utility Water
Management; Design of sludge and effluent
treatment systems; Development of water recycling,
reuse and zero-discharge schemes; Appropriate
technical solutions for water treatment, filtration
and desalination applications.
Savings in Foreign Exchange.
3. Future Plan of Action:
The R&D Centre is committed to providing appropriate
technology support to all Hydrocarbon Projects, as
required by various business units. Future development
activities are identified based on the expected needs of
upcoming Projects as well as requirements for in-house
capability development. The following key areas have
been identified under R&D Action Plan:
In-house design/simulation capability of Ammonia
and Urea Processes.
Rate-based model development and simulation for
Pre-Reformer, HTER and Auto-thermal Reformer.
Capability development in multi-phase flow
assurance studies using OLGA software.
Use of Refinery Residue for Gasification application.
Process design capabilities in Petrochemical/
Polymer Plants.
Process technology for coal gasification (technology
evaluation, coal characterization, performance
simulation, design optimization and system
integration for EPC Projects).
Modularization of Process Plants.
Carbon Capture and Sequestration
techniques for Oil & Gas Projects.
(CCS)
Cryogenic Air Separation Processes (technology
evaluation, process simulation, heat integration
and system engineering).
Use of CFD techniques for performance assessment
of coal gasifiers.
Emerging (Non-traditional) energy solutions such
as CBM, Shale Gas and Tar Sands.
Design of Cryogenic Vaporizers and Cold Boxes for
Air Separation plants.
Design of Combustion Air Pre-heaters for Reformers
in Ammonia Plants.
Design analysis of Bulk Flow coolers in Urea Plants.
Application of Low Temperature Thermal
Desalination process for commercial use.
54
Design/engineering of molten salt based thermal
energy storage system for electric arc furnace with
intermittent operation.
Power generation solutions for offshore process
platforms using wind power.
Development of in-house design/analysis capability
involving Recycle, Reuse and Zero-discharge
Technologies.
Solar energy based desalination plants for “Clean
Energy” initiative.
Advanced Finite Element Analysis (FEA) techniques
for process equipment subjected to thermal shock.
Techniques
for Reliability, Availability &
Maintainability (RAM) studies as part of specialized
engineering support for Process Plants.
Stress analysis of refractory lined equipment and
reinforced concrete structures.
Fitness for Service (Level-3) assessment using FEA.
Advanced FEA based buckling analysis of sub-sea
pipelines.
Theoretical and experimental study on degradation
mechanisms in material of construction for
Ammonia Convertor.
Chemical synthesis of Platinum nano-particles for
development of electrodes for Electro-chemical
applications, with appropriate characterization
tools.
Study on degradation/failure mechanisms for
High-Strength Steel and Duplex Stainless Steels;
Characterization of different heat treated
(Normalized + Tempered and normalized +
accelerated cooling + tempered) low alloy steel for
hydrogen service; Evaluation of hydrogen charged
DSS.
Development of environmentally-friendly (non-
toxic and bio-degradable) chemical formulations
for chemical cleaning and pickling of steels;
Characterization and optimization of selected
chemicals based on surface cleaning efficiency and
material weight loss.
Development of suitable concrete for hydroelectric
projects.
Development of suitable products for buildings.
Development of design tools.
Development of indigenous connection systems for
precast structural members.
Industrial scale manufacturing of the products and
implementation at site.
Algorithms for real time visual projections into
digital.
Improving the standards on composite pavement.
Development of new/upgraded products in defence
equipment.
Development of new/upgraded products in space
equipment.
Development of product as well as technological
development in the areas of Refineries, Fertilizer,
Petrochemical & Energy.
Development of technologies for
Automating integration of Composite #
Metallic
Inside and Outside Perforation of Composite
Air Frame
Development of Hydraulic presses for passenger car
and truck- bus tyres and development of all electric
presses for the same segment by LTRPM. Some of
the products planned are as follows:
Development of All Electric Tyre Curing Press
160”/180” Mechanical Tyre Curing Press
45” Economy version hydraulic Tyre Curing
Press
68.5” Column design hydraulic Tyre Curing
Press
47” Hydraulic press for curing bias tyres
Factory automation system for non-tyre
industries
Integrated development of SMO & BCM
VBU: Indigenous design, manufacture and supply
of entire valve packages including control valves for
process and power plants
Complete process simulation, design solutions and
optimization for Hydrocarbon projects in Fertilizer
sector, involving Reformers, Ammonia Plant and
Urea Plant.
Establishment of in-house capability in Process
Simulation and FEED Verification of on-shore/off-
shore Gas Processing Plants and design optimization
of associated equipment.
In-house expertise for complete Refractory
solutions (e.g., material selection, engineering,
commissioning and troubleshooting) in high-
temperature equipment for process plants.
55
Development of in-house capability in multi-phase
flow simulation studies for Oil & Gas Projects.
Technical support to business units for machinery
acceptance testing and commissioning.
Successful testing/commissioning of plants and
equipment in various Hydrocarbon projects,
through multi-disciplinary technology support.
Complete support to business units for all Materials
related assignments (such as material verification/
selection/evaluation/characterization; selection of
alternative materials; failure analysis; preservation
and corrosion protection of critical equipment;
development of new materials for strategic
applications, identification of newer technologies
and commercially available proven products and
their implementation).
Development of in-house expertise related to
manufacturing processes, welding, heat treatment,
failure mechanisms and corrosion protection/
preservation issues of equipment having special
metallurgy for critical Oil & Gas applications.
Acquisition of know-how pertaining to special
materials and their applications.
Successful troubleshooting/design optimization of
Oil & Gas Processing equipment, heat exchangers,
flares and exhaust stack etc.; Dispersion and
radiation studies for offshore platform; Safety
studies for safe helideck operation; Risk analysis
for simultaneous heavy lift installation and drilling,
using advanced CFD technique; Design and check-
rating of critical thermal equipment for heat
exchange/heat recovery applications; Capability
development in newer applications such as low-
temperature thermal desalination, design of cored
brick heater; Design of HVAC system for offshore
platform; Evaluation of technology proposals on
cold fusion and geothermal power generation.
Establishment of in-house capabilities in analysis
of piping system for flow-induced and acoustic-
induced vibrations; Conduct of Plant Noise studies
utilizing in-house expertise; Development of
in-house capabilities in special acoustic studies
such as piping insulation design and valve noise/
vent noise assessment.
Development of in-house expertise in Fitness
for Service (FFS) Level 1 & Level 2 assessment of
in-service equipment and structures.
Establishment of in-house expertise in structural FE
analysis of offshore floating structures.
Establishment of in-house capability in composite
analysis of complex systems involving equipment,
piping and structures; Design methodology for
advanced FE analysis involving non-linear effects,
shock/impact, thermal fatigue and high-pressure/
high-temperature processes.
Development of in-house expertise in specialized
applications such as buckling analysis of sub-sea
pipeline and boat impact studies.
Technical support to Oil & Gas, Refinery,
Chemicals & Fertilizer Projects for complete
Water and Wastewater management solutions;
Produced Water Injection Water and Utility Water
Management; Design of sludge and effluent
treatment systems; Development of water recycling,
reuse and zero-discharge schemes; Appropriate
technical solutions for water treatment, filtration
and desalination applications.
4. Expenditure on R&D:
Capital
Recurring
Total
Total R&D expenditure as a percentage of
total turnover
crore
2012-13
57.17
98.17
155.34
0.25%
TECHNOLOGY ABSORPTION, ADAPTATION AND
INNOVATION:
1. Efforts in brief made towards technology
absorption, adaptation and innovation:
Development of in-house expertise in advanced
FEA and fatigue analysis techniques for specialized
systems (Orifice Chamber/associated piping); Design
upgrade and optimization of coal pulverizers.
Complete process simulation, design solutions and
optimization for Hydrocarbon projects in Fertilizer
sector, involving Reformers, Ammonia Plant and
Urea Plant.
Successful completion of failure analysis/
troubleshooting assignments for critical machinery;
Establishment of in-house capability in Process
Simulation and FEED Verification of on-shore/off-
56
shore Gas Processing Plants and design optimization
of associated equipment.
In-house expertise for complete Refractory
solutions (e.g., material selection, engineering,
commissioning and troubleshooting) in high-
temperature equipment for process plants.
Development of in-house capability in multi-phase
flow simulation studies for Oil & Gas Projects.
Successful testing/commissioning of plants and
equipment in various Hydrocarbon projects,
through multi-disciplinary technology support.
Complete support to business units for all Materials
related assignments (such as material verification/
selection/evaluation/characterization; selection of
alternative materials; failure analysis; preservation
and corrosion protection of critical equipment;
development of new materials for strategic
applications, identification of newer technologies
and commercially available proven products and
their implementation).
Development of in-house expertise related to
manufacturing processes, welding, heat treatment,
failure mechanisms and corrosion protection/
preservation issues of equipment having special
metallurgy for critical Oil & Gas applications.
Acquisition of know-how pertaining to special
materials and their applications.
Successful troubleshooting/design optimization of
Oil & Gas Processing equipment, heat exchangers,
flares and exhaust stack etc.; Dispersion and
radiation studies for offshore platform; Safety
studies for safe helideck operation; Risk analysis
for simultaneous heavy lift installation and drilling,
using advanced CFD technique; Design and check-
rating of critical thermal equipment for heat
exchange/heat recovery applications; Capability
development in newer applications such as low-
temperature thermal desalination, design of cored
brick heater; Design of HVAC system for offshore
platform; Evaluation of technology proposals on
cold fusion and geothermal power generation.
Establishment of in-house capabilities in analysis
of piping system for flow-induced and acoustic-
induced vibrations; Conduct of Plant Noise studies
utilizing in-house expertise; Development of
in-house capabilities in special acoustic studies
such as piping insulation design and valve noise/
vent noise assessment.
Development of in-house expertise in advanced
FEA and fatigue analysis techniques for specialized
systems (Orifice Chamber/associated piping); Design
upgrade and optimization of coal pulverizers.
Successful completion of failure analysis/
troubleshooting assignments for critical machinery;
Technical support to business units for machinery
acceptance testing and commissioning.
Development of in-house expertise in Fitness
for Service (FFS) Level 1 & Level 2 assessment of
in-service equipment and structures.
Establishment of in-house expertise in structural FE
analysis of offshore floating structures.
Establishment of in-house capability in composite
analysis of complex systems involving equipment,
piping and structures; Design methodology for
advanced FE analysis involving non-linear effects,
shock/impact, thermal fatigue and high-pressure/
high-temperature processes.
Development of in-house expertise in specialized
applications such as buckling analysis of sub-sea
pipeline and boat impact studies.
Technical support to Oil & Gas, Refinery,
Chemicals & Fertilizer Projects for complete
Water and Wastewater management solutions;
Produced Water Injection Water and Utility Water
Management; Design of sludge and effluent
treatment systems; Development of water recycling,
reuse and zero-discharge schemes; Appropriate
technical solutions for water treatment, filtration
and desalination applications.
Pre-Engineered RCC building with complete precast
components for the first time – Cognizant Pune
Canteen building.
3D Solid modelling techniques used for Concrete
design of TCS Customer Care centre.
Creation of a 3D studio (1st of its kind in the
construction industry) where ideas get created
synergized and the designs culminate into virtual
reality.
Exploring Precast & Composite construction as
alternates to conventional system for enhanced
benefits.
Usage of Building Information Modelling as a
platform (Shift from 2D to 3D) for producing
integrated clash free drawings for all type of
projects.
57
Development of hinged launching girder for sharp
radius.
Development of movable type winch launching
girder with provision to lift segment anywhere.
Development of mould system for pre-casting of
monorail guide way beams of radius of curvature
varying 47m to straight.
Implementation of Rail Structure Interaction (RSI).
RSI analysis has been performed for HMRL for first
time in Indian Metros.
Use of controlled low strength material (PCC
mixture with definite workability density and
strength) for backfilling the open foundations in
the viaduct portion of metro.
Technology absorption & adaptation
development of Combat Vehicles
for
Development of Internals made by Centrifugal &
Investment casting for Refinery.
Development of Auto-TIG welding for Aero
equipment.
Adaptation of advance metal cutting process like
Water jet & Laser cutting for Stainless Steel & other
exotic material.
Development of Special Purpose Machine for
Nozzle Cut-outs (with Weld Edge preparation) on
shells for pressure vessels.
Development of Weld Overlay Process for Super
Duplex Stainless Steel material.
Development of in-house Aluminium painting
process.
Interaction with external agencies/technology
partners for exposure to the latest products/
designs, manufacturing technologies, processes,
analytical techniques and engineering protocols.
Active involvement with International/National
Professional Societies (such as IChemE, AIChE/
CCPS, IIChE, ICC, FRI, ASME, NACE, ASM, ASTM,
AISC, ACS, TERI, HTFS, HTRI, STLE, TSI, NAFEMS,
TSI, etc.).
Active participation in National/International
Innovation forums and Innovation contests.
Institutionalization of in-house schemes (such as
ICONs and KnowNet) for identifying, nurturing
and implementing innovative ideas and technology
solutions.
Networking and knowledge sharing through
national/international conferences, seminars and
exhibitions.
58
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.
Nomination of R&D engineers to external training
programs, expert groups and technical committees.
Collaborative efforts with educational/research
institutions for research projects.
Use of state-of-the-art equipment, instrument and
software as well as the latest Codes and Standards.
Analysing feedback from Customers/internal users
to continually improve processes and services.
Process change in HDP fabrication considering
aging distortion.
Development of in-house Rain test facility for
defence products.
Development of proprietary internals by casting
process is in discussion with CLG.
LTRPM indigenized various components for Rubber
Processing Machines by designing, developing
specifications and adapting to Indian conditions.
VBU made following efforts:
Knowledge sharing and participation in
national and international valve conferences,
seminars and exhibitions
Collaborate with external agencies/technology
partners for exposure to latest developments
in control valves and indigenous development
of the same.
Establish
state-of-the-art equipment,
instrument and software for Nuclear
Qualification of Valves
Active
involvement with National and
International professional societies like ASME.
Establish range of metal seated Trunnion
Mounted Ball Valves for oil and gas projects.
Some of the new products that were introduced were
by the E&A Business during the year are MOC range of
capacitor duty contactors, RTO thermal overload relays,
EXORA range of MCBs, new range of electronic trip
units & stored energy motor operator for d sine range
of MCCBs, new frames in change-over-switches, Solar
lantern, extension of range in T-ERA panels up to 5500
A etc.
2. Benefits derived as a result of the above efforts,
e.g., product improvement, cost reduction, product
development, import substitution, etc.:
Indigenization (import substitution) & development
of products for Indian Defence & Space sector.
Indigenization (import substitution) & development
of products for markets of Middle East.
Expansion of product range and export
opportunities.
Product improvement.
Increase in know how within the country.
Cycle time reduction.
Complete process simulation, design solutions and
optimization for Hydrocarbon projects in Fertilizer
sector, involving Reformers, Ammonia Plant and
Urea Plant.
Establishment of in-house capability in Process
Simulation and FEED Verification of on-shore/off-
shore Gas Processing Plants and design optimization
of associated equipment.
In-house expertise for complete Refractory
solutions (e.g., material selection, engineering,
commissioning and troubleshooting) in high-
temperature equipment for process plants.
Development of in-house capability in multi-phase
flow simulation studies for Oil & Gas Projects.
Successful testing/commissioning of plants and
equipment in various Hydrocarbon projects,
through multi-disciplinary technology support.
Complete support to business units for all Materials
related assignments (such as material verification/
selection/evaluation/characterization; selection of
alternative materials; failure analysis; preservation
and corrosion protection of critical equipment;
development of new materials for strategic
applications, identification of newer technologies
and commercially available proven products and
their implementation).
Development of in-house expertise related to
manufacturing processes, welding, heat treatment,
failure mechanisms and corrosion protection/
preservation issues of equipment having special
metallurgy for critical Oil & Gas applications.
Acquisition of know-how pertaining to special
materials and their applications.
Successful troubleshooting/design optimization of
Oil & Gas Processing equipment, heat exchangers,
flares and exhaust stack etc.; Dispersion and
radiation studies for offshore platform; Safety
studies for safe helideck operation; Risk analysis
for simultaneous heavy lift installation and drilling,
using advanced CFD technique; Design and check-
rating of critical thermal equipment for heat
exchange/heat recovery applications; Capability
development in newer applications such as low-
temperature thermal desalination, design of cored
brick heater; Design of HVAC system for offshore
platform; Evaluation of technology proposals on
cold fusion and geothermal power generation.
Establishment of in-house capabilities in analysis
of piping system for flow-induced and acoustic-
induced vibrations; Conduct of Plant Noise studies
utilizing in-house expertise; Development of
in-house capabilities in special acoustic studies
such as piping insulation design and valve noise/
vent noise assessment.
Development of in-house expertise in advanced
FEA and fatigue analysis techniques for specialized
systems (Orifice Chamber/associated piping); Design
upgrade and optimization of coal pulverizers.
Successful completion of failure analysis/
troubleshooting assignments for critical machinery;
Technical support to business units for machinery
acceptance testing and commissioning.
Development of in-house expertise in Fitness
for Service (FFS) Level 1 & Level 2 assessment of
in-service equipment and structures.
Establishment of in-house expertise in structural FE
analysis of offshore floating structures.
Establishment of in-house capability in composite
analysis of complex systems involving equipment,
piping and structures; Design methodology for
advanced FE analysis involving non-linear effects,
shock/impact, thermal fatigue and high-pressure/
high-temperature processes.
Development of in-house expertise in specialized
applications such as buckling analysis of sub-sea
pipeline and boat impact studies.
Technical support to Oil & Gas, Refinery,
Chemicals & Fertilizer Projects for complete
Water and Wastewater management solutions;
Produced Water Injection Water and Utility Water
59
Management; Design of sludge and effluent
treatment systems; Development of water recycling,
reuse and zero-discharge schemes; Appropriate
technical solutions for water treatment, filtration
and desalination applications.
Cost reduction.
Successful in-house development of supercritical
valves as import substitution.
Indigenization & development of Nuclear Valves.
Expansion of product range to grab export
opportunities.
3.
Information regarding technology imported during
the last 5 years
S.
No.
a)
b)
Technology Imported
Year of
Import
Status
Design of control valves 2011-12 Under absorption
Crushing Technology
On continuous basis at
Kansbahal
[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. 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 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.
Hydrocarbon (HC):
The Business has executed large size complex projects
internationally, mainly in GCC region. As a part
of Strategic Plan, “Internationalization” has been
identified as a major theme to drive a business growth
going forward.
The HC Business has been taking various initiatives
to provide fillip to its international operations viz.
Investments in strategic construction equipments &
fabrication yards, appointments of Expats for business
building activities in key customer markets such as GCC,
South East Asia and CIS Countries. Also there have been
few alliances & tie ups with major international players
to pursue large value EPC projects. Experienced and top
60
performer employees have been moved from domestic
operations to international to inculcate the Company’s
best practices in the projects management & execution.
Prequalification has been received for major
international EPC projects from reputed customers in
Saudi Arabia, Iraq, South East Asia and South Africa
region. The Business has incorporated an In-Kingdom
EPC (IK-EPC) company in Saudi Arabia to participate in
EPC prospects reserved for local companies by Saudi
Aramco. The Business has also registered a Construction
Service Provider Representative Office (CSPRO) in
Indonesia which will enable bidding for EPC projects in
the country.
The Business has bagged a few major international
orders during the year including a repeat order from
Petroleum Development Oman for Up-gradation of Gas
Compression Facilities on turnkey basis. These, recent
order wins both in Upstream and Mid & Downstream
segment, reconfirms the growth potential for the HC
Business in international segment.
The Business continues to improve on its safety
performance. During the year there have been several
accolades and appreciations by clients and National &
International agencies which include National Safety
Council, American Society of Safety Engineers, British
Safety Council and RoSPA.
Heavy Engineering (HE):
New Qualifications/Approvals were undertaken as per
SAIPEM specification for supply of Urea Equipment as
per Philips-66 process for Gasification equipment &
for Supply of equipment in emerging technologies in
Russia. Qualification is in progress as per STAMICARBON
specification for High Pressure Urea Equipment and
for Syn-gas cooler (new product line). The Business
is pursuing approval from Shell & UOP for Supply of
proprietary internals for Process Plant Equipment.
Export efforts have been initiated in tapping:
Replacement Market business in Indonesia,
Venezuela & New Zealand
New market in Iraq and CIS countries
Potential market for Modification, Revamp and
Upgrade projects for refineries in Middle East
countries
New Fertilizer investments in USA & Africa
LNG equipment business in USA
New opportunities in Petrochemical emerging out
of increased Shell Gas availability.
Efforts are also made for alignment with Leading Process
Licensors such as KBR, Urea Casale & Invista to increase
Export business.
The HE Business has entered new geographical market
by supplying Ammonia and Urea Equipment to China,
Coal Gasification equipment to Vietnam, Tube bundle
to Venezuela, CCR reactor to New Zealand and Clad
vessels to Iraq. It has also received orders for supply of
fertilizer equipment & LNG equipment to USA, Revamp
Project in Petrochemical plant in Saudi Arabia, Supply
of Ammonia, Urea equipment and Boiler package to
Nigeria and Supply Equipment for Boiler & Reactor
packages to Hydrogen plant in Russia.
The Business has supplied High Value Reactors, Coke
drums and High Pressure Heat Exchangers to Green
field Refinery projects in Brazil. HE expects business
from Ammonia Casale/UHDE for supply of Ammonia
Converter Baskets and exploring standalone supplier of
Reactor Internals for Refinery Business.
The Business has been exploring opportunities for export
of Defence, Nuclear Power & Aerospace equipment as
well. Orders have been received for Supply of Casks
& Canisters to US Customer, Supply of equipment
to Israel Aerospace Industries & ITER (International
Thermonuclear Experimental Reactor).
Construction:
The Focus on GCC Countries occupies a predominant
position for PT&D for its International Business. The year
2012-13 was an extremely challenging year. Long lead
time between bid submission & Finalization has affected
the Order Inflow in the Gulf. The Company’s Global Foot
Print coupled with project execution capabilities helped
the Construction Business in securing major orders in
UAE & Qatar. The Business has substantially improved its
market share in Qatar. In order to expand the business
horizon, it has embarked on the ASEAN/African Market.
Efforts are on to penetrate the market by focusing some
of the East African Countries.
Business Environment:
Construction industry continues to witness slowdown
and was very sluggish during the2012-13. In UAE, the
Abu Dhabi Government despite being highly liquid
and cash rich is very cautious in their approach. It is
evident from the delay in placement of Tender/Award
of Contracts.
Business Performance:
The Construction Business achieved a major
Breakthrough in 220 kV Segment in UAE by securing
220/33 kV Grid Station at Zakher & Ayn Al Faydha for
AADC in addition to 132kV GIS substations for FEWA.
The business has also bagged a prestigious order to
execute 11 kV Power Distribution Network for Emirates
Palace.
A Major Breakthrough in Airport Segment in Gulf
Market was attained by securing Special Airport System
Package for Concourse 4 of Dubai International Airport
and also E&I Works for Abu Dhabi Airport Airside works.
Volatility in Commodity Prices:
Though oil price was not seen with much oscillation,
the Commodity Price had lot of volatility. However the
Construction Business protected its margin by mitigating
the risk through proper hedging.
Outlook:
In the International (Gulf) market, the combination
of historically high oil prices, expanded oil production
and low interest rates is supporting buoyant economic
activity. Fiscal and external surplus are large, inflation
is moderate, and prospects for growth remain positive.
GCC investment plans on Grid Strengthening &
infrastructural development continues to be in line with
economic development offering substantial potential in
T&D Sector.
Intensifying Power Demand in Africa & South East
Asian countries unleashes significant potential & new
opportunities in T&D sector.
With its foot firmly established in all GCC countries
now, the business has set its sight to expand to African
Countries & corner a significant market share in GCC
markets.
Electrical & Automation (E&A):
During financial year 2012-13, E&A registered 44%
increase over the previous year in Order Inflow from
international markets. E&A Business earned 10% of
its revenue from international sales in FY 2013. The
LV & MV switchboard business could get higher orders
from the Middle-East market, largely from the oil & gas
sector. There also was a flow of good order from the
utility sector in Kenya.
One of the major initiatives taken by E&A Business during
the financial year was to create an International Sales
Organization in order to focus on select geographies
divided into five clusters. The sales organizational unit,
called Cluster Sales Unit (CSU), will present a single
face and be responsible for all the customer front-end
activities related to the geography. They will have full
responsibility for the implementation and delivery of the
Lakshya plan in so far as the order input targets for the
individual BUs under them are concerned.
The acquisition of Servowatch in the UK and Henikwon
Corporation in Malaysia will further boost E&A’s business
prospects.
During the year, E&A filed 159 Patent applications,
29 Trademark applications, 36 Design registrations
and 2 Copyrights as well as 10 international Patent
applications including 6 Patent Cooperation Treaty
(PCT) and 4 Gulf Cooperation Council (GCC) Patent
61
applications. This was the 6th consecutive year of
filing more than 100 Patent applications. Continuous
efforts on IP creation and its management earned the
business the highest awards in patents filing and design
registration, instituted by the Indian Patents Office, viz.
‘The Top Indian Private Company (Large Scale) in Patents
2012’ and ‘The Top Indian Organization in Designs
2012’
Future Outlook:
According to the Lakshya plan 2016, the switchboard
business will continue to focus on improving its share
of international business and target achieving at least
25% of its total revenue. As far as products business
is concerned, E&A has a target to earn about 10%
revenue. This will help the business to increase its overall
earning from international market in FY 2013-14 and
achieve 13% target by the end of Lakshya plan 2016.
Power:
The Power Business is engaged in technology solutions
to setup Coal based Power Plants and Gas based Power
Plants. Since coal is not a permitted fuel in several
countries, the potential for projects is seriously limited.
Hence, the focus is on opportunities for Gas Based
Power Plant in relevant countries where the Power
Business is confident of being competitive as well as
capable of successful execution. The focus is on Middle
East, where the business has set up two smaller power
projects, and South East Africa. The Power Business is
pursuing active leads in these regions and striving for a
major breakthrough.
The Critical Piping unit which Manufactures High
Pressure Piping Spools for Thermal Power Plants is
seeking opportunities in Middle East. Steps have been
taken to build a business development and Marketing
team at Abu Dhabi.
The Joint Ventures with Mitsubishi Heavy Industries for
manufacture of Steam Turbines and Steam Generators
are seeking to supply components to MHI’s third country
projects.
Manufacturing & Industrial Products (MIP):
(LTRPM) has
Rubber Machinery Business Unit
successfully supplied the prototype Press to a major
European Tyre Manufacturer and the trial is completed.
Based on this successful performance, LTM has received
communication for quoting towards serial production of
10 Nos. of presses to their plants worldwide. LTM also
succeeded in obtaining an order from another Major
American Tyre Major and delivered Automatic Truck Tyre
62
Building Machines, which opens a new market segment
for the unit.
In line with the strategy, Valves Business has strengthened
marketing network in the Middle East and it has yielded
results in brand acceptance and customer approvals
with the National Oil Companies in the region.
Sustained oil & gas project activity in the Middle East,
North Africa and Australia provided good opportunity
for valves. Long-term relationships with key end-users
and EPCs in the Middle East and Far East were leveraged
to enhance our market presence.
In the Valves business, approximate 51% of our total
revenue was from exports.
A few initiatives detailed:
The following initiatives are being followed on a
continuous basis by the Company:
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 internal processes towards
operational excellence and creating a lean high
performance organization.
Knowledge dissemination through various
platforms within the organization.
Bringing in high caliber resources in the areas
of front-end marketing, engineering, project
risk management, contract
management,
administration, etc., to strengthen the overseas
operations.
Customized Talent Management programs
catering to the training and development needs of
employees.
Total foreign exchange used and earned:
Foreign Exchange earned
Foreign Exchange saved/deemed
exports
Total
Foreign Exchange used
crore
2012-13
13,123.69
3,871.12
16,994.81
15,212.90
Annexure ‘B’ to the Directors’ Report
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
(I) Employee Stock Ownership Scheme-1999-2003
A. PRE RESTRUCTURE:
ESOP SERIES
Particulars
(1)
SAR-1999
(2)
2000
(3)
2002-A
(4)
2002-B
(5)
2003-A
(6)
2003-B
(7)
(a) Options granted
(b) The pricing formula
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
– 184/- per
share.
The average
market price
on the Stock
Exchange,
Mumbai, on
the date of
grant i.e.,
April 19, 2002
– 172/- per
share.
The average
market price
on the Stock
Exchange,
Mumbai, on
the date of
grant , i.e,
April 19, 2002
– 172/- per
share.
The average
of the two
weeks high
and low prices
of the shares
on the Stock
Exchange,
Mumbai,
preceding the
date of grant
i.e., May 23,
2003 – 206/-
per share.
The average
of the two
weeks high
and low prices
of the shares
on the Stock
Exchange,
Mumbai,
preceding the
date of grant
i.e., May 23,
2003 – 206/-
per share.
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 199/-
per share.
(c)
Options vested
10,60,750
38,64,050
20,67,250
20,19,830
(d) Options exercised
(e) Total number of shares
arising as a result of exercise
of Options (Equity shares of
10/- each)
2,66,500
1,04,318
52,415
52,415
12,750
12,750
6,250
6,250
(f) Options lapsed
5,250
1,46,025
1,25,300
1,07,375
(g) Variation of terms of Options
Nil
Nil
Nil
Nil
(h) Money realised by exercise of
10,43,180/-
96,44,360/-
21,93,000/-
10,75,000/-
Options
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
(i)
Total Number of Options in
force
7,94,250
SARs
37,50,360
36,43,050
36,68,035
67,51,000
57,42,500
63
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
(I) Employee Stock Ownership Scheme-1999-2003
A. PRE RESTRUCTURE (contd.):
ESOP SERIES
Particulars
(1)
SAR-1999
(2)
2000
(3)
2002-A
(4)
2002-B
(5)
2003-A
(6)
2003-B
(7)
(j)
Employee-wise details of
Options granted to –
i)
Senior Managerial
Personnel:
Mr. A. M. Naik
1,25,000
2,00,000
2,00,000
2,00,000
2,00,000
2,00,000
Mr. K. Venkataramanan
Mr. V. K. Magapu
Mr. M. V. Kotwal
Mr. S. N. Subrahmanyan
Mr. R. Shankar Raman
Mr. Y. M. Deosthalee
Mr. K. V. Rangaswami
Mr. J. P. Nayak
Mr. R. N. Mukhija
Mr. A. Ramakrishna
Mr. P. M. Mehta
Mr. M. Karnani
60,000
20,000
16,500
–
–
60,000
16,000
1,00,000
1,00,000
1,20,000
1,20,000
1,20,000
35,000
27,000
5,400
5,000
35,000
27,000
4,800
13,000
40,000
30,000
3,400
14,000
22,500
17,500
3,250
12,500
22,500
17,500
3,250
12,500
1,00,000
1,00,000
1,20,000
1,20,000
1,20,000
25,000
25,000
27,000
17,500
17,500
60,000
1,00,000
1,00,000
1,20,000
1,20,000
1,20,000
30,000
80,000
30,000
40,000
60,000
85,000
1,25,000
1,25,000
60,000
42,000
85,000
–
80,000
90,000
40,000
–
85,000
60,000
–
–
85,000
–
–
–
5,37,500
8,84,400
8,99,800
8,84,400
7,78,250
7,18,250
ii) Any other employee
None
None
None
None
None
None
iii)
who receives a grant,
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
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 2/- for every two Options and repriced at 14/- per Option in respect of ESOP Series 1999, 2000, 2002-A & 2002-B
and 70/- per Option in respect of ESOP Series 2003-A & 2003-B.
64
(a)
(b)
(c)
(d)
(e)
(f)
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
(I) Employee Stock Ownership Scheme-1999-2003
B. POST RESTRUCTURE (PRE BONUS ISSUE -2006) :
Particulars
(1)
(1) Options granted
(outstanding 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 2/- each)
The pricing formula
(Adjusted grant price per
share )
Options vested
(adjusted on restructure)
ESOP SERIES
1999
(2)
3,97,125
2000
(3)
18,75,180
2002-A
(4)
18,21,525
2002-B
(5)
18,34,018
2003-A
(6)
33,75,500
2003-B
(7)
28,71,250
14/-
3,97,125
18,75,180
10,22,050
10,02,003
6,02,670
56,460
35,30,380
Nil
70/-
Nil
Add: vested post restructure
–
–
7,90,312
8,20,708
20,51,220
19,32,585
3,97,125
3,97,121
3,97,121
18,75,180
18,65,367
18,65,367
18,12,362
18,03,824
18,03,824
18,22,711
18,04,510
18,04,510
20,51,220
20,33,343
20,33,343
19,32,585
19,14,964
19,14,964
4
5,613
12,326
14,583
6,94,997
3,23,009
Nil
55,59,694/-
Nil
2,61,15,138/-
Nil
2,52,53,536/-
Nil
2,52,63,140/-
Nil
14,23,34,010/-
Nil
13,40,47,480/-
Nil
Nil
Nil
4,200
Nil
4,200
5,375
Nil
5,375
14,925
Nil
17,389
6,29,771
17,135
12,75,272
14,925
6,47,160
12,92,407
Please refer to Part A(j)
Total
Options exercised
Total number of shares arising
as a result of exercise of Options
(Equity shares of 2/- each)
Options lapsed and/or
withdrawn
Variation of terms of Options
(g)
(h) Money realised by exercise of
(i)
(j)
Options
Total Number of Options in
force -
Vested
Unvested
Total
Employee-wise details of
Options granted
Options granted to Senior
Managerial Personnel post
Restructure Pre Bonus Issue
2006:
Mr. Shailendra Roy
10,000
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 14/- and 70/- was readjusted to 7/- and 35/- respectively.
–
–
–
–
–
65
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
(I) Employee Stock Ownership Scheme-1999-2003
C. POST RESTRUCTURE (POST BONUS ISSUE 2006 – PRE BONUS ISSUE 2008):
ESOP SERIES
(a)
(b)
(c)
Particulars
(1)
(1) Options granted (outstanding
and adjusted consequent to
Bonus Issue)
(2) Options granted post Bonus
Issue
(Equity shares of 2/- each)
The pricing formula
(Adjusted grant price per share )
Options vested
(adjusted on Bonus Issue)
Add: vested post Bonus Issue
(d)
(e)
Total
Options exercised
Total number of shares arising as a
result of exercise of Options* (Equity
shares of 2/- each)
Options lapsed
(f)
(g)
Variation of terms of Options
(h) Money realised by exercise of Options
(i)
Total Number of Options in force-
Vested
Unvested
(j)
Total
Employee-wise details of Options
granted
Options granted to Senior Managerial
Personnel post Bonus Issue 2006 (Pre
Bonus Issue 2008):
Mr. S.N. Subrahmanyan
Mr. R. Shankar Raman
Mr. Shailendra Roy
1999
(2)
2000
(3)
2002-A
(4)
2002-B
(5)
Nil
8,400
10,750
29,850
2003-A
(6)
12,94,320
2003-B
(7)
25,84,814
7,18,430
33,03,244
7/-
35/-
8,400
10,750
29,850
34,778
34,270
–
–
–
12,35,430
19,90,863
8,400
10,750
29,850
Nil
10,000
12,70,208
12,52,754
12,45,754
20,25,133
19,38,270
18,95,270
Nil
Nil
70,000/-
25,840
Nil
4,36,01,390/-
2,12,861
Nil
6,63,34,450/-
Nil
Nil
Nil
Nil
Nil
10,750
Nil
19,850
Nil
15,726
Nil
81,963
10,70,150
10,750
19,850
15,726
11,52,113
Please refer to Part A (j) and Part B (j)
–
–
–
–
–
–
–
–
–
7,000
9,000
6,500
Nil
Ni
Nil
Nil
Nil
8,400
Nil
8,400
–
–
–
Nil
–
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
–
–
–
22,500
* During the year 2007-08 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 former Directors in accordance with the consent terms approved by the Hon’ble High Court of Bombay on
June 14, 2007.
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 7/- and 35/- was readjusted to 3.50 and 17.50
respectively.
66
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
(I) Employee Stock Ownership Scheme-1999-2003
D. POST RESTRUCTURE (POST BONUS ISSUE 2008):
ESOP SERIES
Particulars
(1)
1999
(2)
2000
(3)
2002-A
(4)
2002-B
(5)
2003-A
(6)
2003-B
(7)
(a)
(1) Options granted (outstanding
Nil
16,800
21,500
39,700
31,452
23,04,226
and adjusted consequent to
Bonus Issue)
(2) Options granted post Bonus
Issue (Equity shares of
2/- each)
(b)
(c)
The pricing formula
(Adjusted grant price per share )
Options vested
(adjusted on Bonus Issue)
Add: vested post Bonus Issue
Total
(d) Options exercised
(e)
(f)
(g)
Total number of shares arising
as a result of exercise of Options
(Equity shares of 2/- each)
Options lapsed
Variation of terms of Options
(h) Money realised by exercise of
Options
(i)
Total Number of Options in force -
Vested
Unvested
Total
(j)
Employee-wise details of Options
granted
Options granted to Senior
Managerial Personnel post Bonus
Issue 2008:
8,31,200
31,35,426
Nil
–
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
3.50
17.50
16,800
21,500
39,700
31,452
1,63,926
–
–
–
–
24,33,134
16,800
21,500
39,700
31,452
25,97,060
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
24,45,579
24,45,579
2,54,645
Nil
4,27,97,632.50
16,800
Nil
21,500
Nil
39,700
Nil
31,452
Nil
1,09,802
3,25,400
16,800
21,500
39,700
31,452
4,35,202
Please refer to Part A (j), Part B (j) and Part C (j)
Mr. Ravi Uppal
–
–
–
–
–
20,000
67
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
(II) Employee Stock Option Scheme-2006
A. PRE BONUS ISSUE 2008
ESOP SERIES
(a)
(b)
(c)
(d)
(e)
Particulars
(1)
(1) Options granted (Pre Bonus Issue)
Options Outstanding and adjusted
consequent to Bonus Issue#
(2) Options granted Post Bonus Issue
(Equity shares of 2/- each)
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 – 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 – 2,198/- per share (Discounted
grant price per share – 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 2,404/- was readjusted to 1, 202/-.
Options vested
Options exercised
Total number of shares arising as a result
of exercise of Options (Equity shares of
2/- each)
Options lapsed and/or withdrawn
Variation of terms of Options
20,13,200
12,80,677
12,80,677
40,524
25,034
25,034
32,72,955
Nil
153,93,73,754
1,80,428
Nil
3,00,90,868
(f)
(g)
(h) Money realised by exercise of Options
(i)
Total Number of Options in force –
Vested
Unvested
(j)
Total
Senior Managerial Personnel
Employee-wise details of Options granted
to –
i)
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
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
iii)
6,97,138
61,15,000
68,12,138
14,844
26,85,934
27,00,778
None
None
None
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 1202/- was readjusted
to 601/-.
68
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
(II) Employee Stock Option Scheme-2006
B. POST BONUS ISSUE 2008:
Particulars
(1)
(a)
(1) Options granted (outstanding and
adjusted consequent to Bonus Issue)
ESOP SERIES
2006
(2)
1,36,24,276
(2) Options granted Post Bonus Issue
Nil
(Equity shares of 2/- each)
2006-A
(3)
54,01,556
96,55,230
1,36,24,276
1,50,56,786
(b)
(c)
The pricing formula
(Adjusted grant price per share)
Options vested
(Adjusted on Bonus Issue)
601/-
13,94,276
Add: Vested post Bonus Issue
1,17,96,055
Total
(d) Options exercised
(e)
(f)
(g)
Total number of shares arising as a result
of exercise of Options (Equity shares of
2/- each)
Options lapsed and/or withdrawn
Variation of terms of Options
1,31,90,331
1,17,54,447
1,17,54,447
9,58,361
Nil
29,688
72,30,442
72,60,130
47,15,162
47,15,162
30,52,295
Nil
(h) Money realised by exercise of Options
706,44,22,647
283,38,12,362
(i)
Total Number of Options in force –
Vested
Unvested
Total
(j)
Employee-wise details of Options granted
to –
i)
Senior Managerial Personnel
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
9,11,468
Nil
9,11,468
21,35,578
51,53,751
72,89,329
None
None
None
69
Information required to be disclosed under SEBI (ESOS & ESPS) Guidelines, 1999
Employee Stock Ownership Scheme -1999-2003 and Employee Stock Option Scheme 2006
Diluted Earning per Share (EPS) pursuant to issue of shares on exercise
of Options calculated in accordance with Accounting Standard (AS) 20
(k)
(l)
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.
a. Diluted EPS before extraordinary items 78.18
b. Diluted EPS after extraordinary items 79.33
Had fair value method been adopted for expensing the
compensation arising from employee share-based payment plans:
The employee compensation charge debited to the
a.
Statement of Profit and Loss for the year 2012-13 would
have been higher by 29.85 crore (previous year: 25.99
crore) [excluding
2.30 crore (previous year: 4.79 crore)
on account of grants to employees of subsidiary companies]
Basic EPS before extraordinary items would have decreased
from 78.82 per share to 78.33 per share
Basic EPS after extraordinary items would have decreased
from 79.99 per share to 79.50 per share
b.
c.
d. Diluted EPS before extraordinary items would have
decreased from 78.18 per share to 77.70 per share
e. Diluted EPS after extraordinary items would have decreased
from 79.33 per share to 78.85 per share
(m)(i)
(a) Weighted average exercise price of Options granted during the
543.15 per share
year where exercise price is less than market price.
(b) Weighted average exercise price of Options granted during the
No such grants during the year
year where exercise price equals market price.
m(ii)
(a) Weighted average fair value of Options granted during the year
909.35 per share
where exercise price is less than market price.
(b) Weighted average fair value of Options granted during the year
No such grants during the year
where exercise price equals market price.
(n)
Method and significant assumptions used to estimate the fair value
of Options granted during the year.
(a) Method
(b) Significant Assumptions
Black-Scholes Option Pricing Model
(i) Weighted average risk-free interest rate
(ii) Weighted average expected life of Options
(iii) Weighted average expected volatility
(iv) Weighted average expected dividends
(v) Weighted average market price
8.05%
4.26 years
39.38%
70.24 per option
1317.81 per option
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 Employees Stock Option Schemes in accordance with SEBI (Employee Stock Option Scheme
and Employee Stock Purchase Scheme) Guidelines, 1999 and the resolutions of the Company in general meetings held on 26 August, 1999,
22 August, 2003 and 25 August, 2006.
Mumbai, May 22, 2013
70
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
ANNEXURE ‘C’ TO THE DIRECTORS’ REPORT
A. CORPORATE GOVERNANCE
Corporate Governance is a set of principles, processes and systems which govern a company. The elements of Corporate
Governance are independence, transparent, accountability, responsibility, compliance ethics, values and trust. Corporate
Governance enables an organization to perform efficiently and ethically generate long term wealth and create value
for all its stakeholders.
The Company believes that sound Corporate Governance is critical for enhancing and retaining investor trust and
your Company always seeks to ensure that its performance goals are met with integrity. The Company has established
systems and procedures to ensure that its Board of Directors is well informed and well equipped to fulfill its overall
responsibilities and to provide management with the strategic direction needed to create long term shareholders value.
The Company has adopted many ethical and transparent governance practices even before they were mandated by
law. The Company has always worked towards building trust with shareholders, employees, customers, suppliers and
other stakeholders based on the principles of good corporate.
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. THE GOVERNANCE STRUCTURE
The Company has four tiers of Corporate Governance structure, viz.:
(i) Strategic Supervision – by the Board of Directors comprising the Executive and Non-Executive Directors.
(ii) Executive Management – by the Corporate Management comprising of the Executive Directors and one Senior
Managerial Personnel and four Advisors to the Chairman.
(iii) Strategy & Operational Management – by the Independent Company (not legal entities) Boards of each
Independent Company (IC) comprising of representatives from the Company Board, Senior Executives from the IC
and independent members.
(iv) Operational Management – by the Business Unit (BU) 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. Executive Management Committee (EMC):
The EMC plays an important role in maintaining the linkage between IC’s and the Company’s Board as well as in
realizing inter-IC synergies and cross cutting opportunities. The key responsibilities of the EMC include approval of
policies cutting across IC’s and at Corporate level such as capital investments, expansions, customer and supplier
synergy, Corporate Social Responsibility (CSR) and reviewing the consolidated financials and budgets before they
are presented to the Company Board.
c. Group Executive Chairman (GEC):
The GEC is the Chairman of the Board and the Executive Management Committee. His primary role is to provide
leadership to the Board and the Corporate Management for realizing the approved strategic plan and business
71
objectives. He presides over the Board and the Shareholders’ meetings. The Group Executive Chairman provides
leadership and devotes his full attention to certain core actions which include, inter alia, focus on restructuring,
mentor senior executives, succession planning, corporate governance, interface with critical Government entities
and major customers for the Company and Group Companies and provide support, wherever necessary.
d. Chief Executive Officer and Managing Director (CEO & MD):
The CEO & MD will be fully accountable to the Board for the Company’s business results, people development,
operational excellence, business development and other related responsibilities.
e. Executive Directors (ED)/Senior Management Personnel:
The Executive Directors, as members of the Board, along with the Senior Management Personnel in the Executive
Management Committee, 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.
f. Non-Executive Directors (NED):
The Non-Executive Directors play a critical 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.
g.
Independent Company Board (IC Board):
In 2010-11, the Company developed its strategic plan for 2010-15 (LAKSHYA 2015) which, inter alia, defined
various business areas to be focused on over the next five years. The thrust of LAKSHYA 2015 was increased
accountability and ownership for performance, making the Company less complex to manage and be more focused
on its core business. The Company was restructured into 12 independent Companies (ICs) [not legal entities] with
each IC having its own Board, with members within the Company, independent members and a representative
from the Company’s Board.
Since the formulation of “LAKSHYA 2015” the development in domestic and international environment impacted
the performance and future expectations of many of the Company’s existing businesses compared to the original
targets in “LAKSHYA 2015”. During the year, the Company undertook the Mid-Term Review of the Strategy and
evolved the revised Strategic Plan called “Lakshya 2016” to initiate various Strategic changes in the original plan.
E. BOARD OF DIRECTORS
a. Composition of the Board:
The Company’s policy is to have an appropriate mix of Executive & Non-Executive Directors. As on date, the Board
comprises Group Executive Chairman, Chief Executive Officer and Managing Director, 4 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 and also if necessary, in locations, where the Company operates. During the year under
review, 10 Meetings were held on April 4, 2012, April 5, 2012, April 6, 2012, April 7, 2012, May 14, 2012, July
23, 2012, October 22, 2012, December 15, 2012, January 24, 2013 and January 25, 2013.
The Company Secretary prepares the agenda and the explanatory notes, in consultation with the Group Executive
Chairman and CEO & 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 at least once every quarter inter alia to review the
quarterly results. Additional Meetings are held, when necessary. Presentations are made on business operations
to the Board by Independent Company/Business Units. 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
72
the Group Executive Chairman. The minutes is 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 following composition of the Board of Directors is as on March 31, 2013. Their attendance at the Meetings
during the year and at the last Annual General Meeting is as under:
Name of Director
Category
Meetings held
during the year
No of Board
Meetings
attended
Attendance at
last AGM
Mr. A. M. Naik
Mr. K. Venkataramanan
Mr. V. K. Magapu ^
Mr. M. V. Kotwal
Mr. Ravi Uppal @
Mr. S. N. Subrahmanyan
Mr. R. Shankar Raman
Mr. Shailendra Roy
Mr. S. Rajgopal
Mr. S. N. Talwar
Mr. M. M. Chitale
Mr. Thomas Mathew T. (Note 1) *
Mr. N. Mohan Raj (Note 1)
Mr. Subodh Bhargava
Mr. A. K. Jain (Note 2)
Mr. J. S. Bindra $
Mr. M. Damodaran #
Mr. Vikram Singh Mehta #
Mr. Sushobhan Sarker (Note 1) %
GEC
CEO & MD
ED
ED
ED
ED
ED
ED
NED
NED
NED
NED
NED
NED
NED
NED
NED
NED
NED
10
10
6
10
6
10
10
10
10
10
10
7
10
10
10
6
4
4
2
Meetings held during the year are expressed as number of meetings eligible to attend.
Note: 1. Representing equity interest of LIC
10
10
6
10
6
10
10
10
10
10
10
2
10
9
10
6
4
4
2
YES
YES
YES
YES
YES
YES
YES
YES
YES
YES
YES
YES
YES
YES
YES
NO
NO
NO
NO
2. Representing equity interest of SUUTI
ceased to be a director w.e.f. 24.08.2012.
resigned as a whole-time director w.e.f. close of working hours of 15.09.2012.
retired as a whole-time director w.e.f. close of working hours of 30.09.2012.
ceased to be a director w.e.f. 19.11.2012.
Appointed as an Additional Director w.e.f. 22.10.2012.
$
@
^
*
#
% Appointed as a Director w.e.f 15.12.2012
GEC – Group Executive Chairman
CEO & MD – Chief Executive Officer and Managing Director
ED – Executive Director
NED – Non-Executive Director
1. None of the above Directors are related inter-se.
2. None of the Directors hold the office of director in more than the permissible number of companies under
the Companies Act, 1956.
73
As on March 31, 2013, the number of other Directorships & Memberships/Chairmanships of Committees of the
Board of Directors are as follows:
Name of Director
Mr. A. M. Naik
Mr. K. Venkataramanan
Mr. M. V. Kotwal
Mr. S. N. Subrahmanyan
Mr. R. Shankar Raman
Mr. Shailendra Roy
Mr. S. Rajgopal
Mr. S. N. Talwar
Mr. M. M. Chitale
Mr. N. Mohan Raj
Mr. Subodh Bhargava
Mr. A. K. Jain
Mr. M. Damodaran
Mr. Vikram Singh Mehta
Mr. Sushobhan Sarker
No of other company
Directorships
3
2
2
1
6
14
1
13
9
1
7
2
9
4
6
No. of Committee
Membership
1
–
–
1
7
5
1
5
5
1
3
1
5
1
1
No. of Committee
Chairman-ship
–
–
–
–
–
1
–
4
5
–
2
1
2
1
1
Committee memberships include memberships of Audit Committee and Shareholders’ Grievance Committee in
all public limited companies (whether listed or not) and excludes private limited companies, foreign companies
and Section 25 companies.
The Committee Chairmanships/Memberships are within the limits laid down in Clause 49 of the Listing
Agreement.
c.
Information to the Board:
The Board of Directors has complete access to the information within the Company, which inter alia includes -
Annual revenue budgets and capital expenditure plans
Quarterly results and results of operations of Independent Company and business segments
Financing plans of the Company
Minutes of meeting of Board of Directors, Audit Committee, Nomination & Remuneration Committee and
Shareholders’/Investors’ Grievance Committee
Details of any joint venture, acquisitions of companies or collaboration agreement
Quarterly report on fatal or serious accidents or dangerous occurrences, any material effluent or pollution
problems
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
d. Post-meeting internal communication system:
The important decisions taken at the Board/Committee meetings are communicated to the concerned departments/
Independent Company promptly.
74
F. BOARD COMMITTEES
The Board currently has 3 Committees: 1) Audit
Committee, 2) Nomination and Remuneration
Committee and 3) Shareholders’/Investors’ Grievance
Committee. The terms of reference of the Board
Committees are determined by the Board from time to
time. The Board is responsible for constituting, assigning
and co-opting the members of the Committees. The
meetings of each Board Committee are convened
by the respective Committee Chairman. The role
and composition of these Committees, including the
number of meetings held during the financial year and
the related attendance are provided below.
1) Audit Committee (AC)
i) Terms of reference:
The role of the Audit Committee includes the
following:
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
t h e
a d e q u a c y
R e v i e w i n g
a n d
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
mechanisms of the Company
the
risk management
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,
formation of committee at Independent
Company time
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
Approval of the appointment of the Chief
Financial Officer (CFO).
Recommendation of appointment of cost
auditor.
Minutes of the Audit Committee Meetings
are circulated to the Members of the Board of
Directors and taken note of.
ii) Composition:
The Audit Committee of the Board of Directors
was formed in 1986 and as on March 31, 2013
comprised four Non-Executive Directors, all of
whom are independent.
iii) Meetings:
During the year ended March 31, 2013, 8
meetings of the Audit Committee were held
on May 2, 2012, May 14, 2012, June 18, 2012,
July 23, 2012, August 24, 2012, October 22,
2012, November 28, 2012 and January 24,
2013.
The attendance of Members at the Meetings
was as follows:
Name
Status
No. of
meetings
during
the year
No. of
Meetings
Attended
Mr. M. M. Chitale
Chairman
Mr. N. Mohan Raj
Mr. A. K. Jain
Mr. M. Damodaran $
Member
Member
Member
8
8
8
1
8
8
8
1
Reviewing of compliance with Listing
Agreement and various other legal
requirements concerning
financial
statements and related party transactions
Meetings held during the year are expressed
as number of meetings eligible to attend.
$ Mr. M. Damodaran has been appointed as a
member of Audit Committee on 15.12.2012
75
and has attended the only meeting held since
that date.
All the members of the Audit Committee are
financially literate and have accounting or
related financial management expertise.
The CEO & MD, the Chief Financial Officer
and the Head of Corporate Audit Services are
permanent invitees to the Meetings of the
Audit Committee. The Company Secretary is
the Secretary to the Committee.
iv) Internal Audit:
The Company has an internal corporate audit
team consisting of Chartered Accountants,
Engineers & system experts. Over a period
of time, the Corporate Audit department
has acquired in-depth knowledge about
the Company, its businesses, its systems
& procedures, which knowledge is now
institutionalized. The Company’s Internal Audit
function is ISO 9001:2008 certified. The Head
of Corporate Audit Services reports jointly
to the Group Executive Chairman and Chief
Executive Officer & Managing Director. The
staff of Corporate Audit department is rotated
periodically.
From time to time, the Company’s systems
of internal controls covering financial,
operational, compliance, IT applications, etc.
are reviewed by external experts. Presentations
are made to the Audit Committee on the
findings of such reviews. The minutes of the
Audit Committee are circulated to the Board
and discussed at Board meetings.
The Company’s Audit Committee, inter
alia, reviews the adequacy of internal audit
function, reviews the internal audit reports
including those related to internal control
weaknesses and reviews the performance of
the Corporate Audit Department. The Audit
Committee is provided necessary assistance
and information to carry out their function
effectively.
2) Nomination & Remuneration Committee (N&R)
(earlier known as Nomination & Compensation
Committee)
i) Terms of reference:
To review, assess and recommend the
appointment of Executive and Non-Executive
76
Directors
(NED) and, to review their
remuneration package, to recommend
compensation to the NEDs 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, 2013, the Committee
comprised 3 Non-Executive Directors and the
Group Executive Chairman.
iii) Meetings:
During the year ended March 31, 2013, 9
meetings of the Nomination & Remuneration
Committee were held on April 6, 2012, May
14, 2012, July 23, 2012, August 24, 2012,
September 27, 2012, October 22, 2012,
January 7, 2013 and January 25, 2013
The attendance of Members at the Meetings
was as follows:
Name
Status
No. of
meetings
during
the year
No. of
Meetings
Attended
Mr. S. Rajgopal
Mr. S. N. Talwar
Mr. Subodh Bhargava
Mr. A. M. Naik
Chairman
Member
Member
Member
Mr. Thomas Mathew T. $
Member
Mr. J. S. Bindra *
Member
9
9
9
9
6
4
9
9
9
9
5
4
Meetings held during the year are expressed
as number of meetings eligible to attend.
$ Ceased to be a member w.e.f. 19.11.2012
* Ceased to be a member w.e.f. 24.08.2012
iv) Board Membership Criteria:
While screening, selecting and recommending
to the Board new members, the Committee
ensures that the Board is objective, there
is absence of conflict of interest, ensures
availability of diverse perspectives, business
experience, legal, financial & other expertise,
integrity, managerial qualities, practical
wisdom, ability to read & understand financial
statements, commitment to ethical standards
and values of the Company and ensure healthy
debates & sound decisions.
While evaluating the suitability of a Director for
re-appointment, besides the above criteria, the
Committee considers the past performance,
attendance & participation in and contribution
to the activities of the Board by the Director.
The Non-Executive Directors comply with the
definition of Independent Director as given
under Clause 49 of the Listing Agreement.
As per the definition, all our NED’s qualify as
“Independent Directors”. While appointing/
re-appointing any NED’s on the Board, the
Committee, considers the criteria as laid down
in the Listing Agreement.
All the Independent Directors give a certificate
confirming that they meet the “independence
criteria” as mentioned in Clause 49 of the
Listing Agreement.
Committees. The commission is paid as per
limits approved by shareholders, subject to a
limit not exceeding 1% p.a. of the profits of
the Company (computed in accordance with
Section 309(5) of the Companies Act, 1956).
The commission to NEDs is distributed broadly
on the basis of their attendance, contribution
at the Board, the Committee meetings,
Chairmanship of Committees and participation
in IC meetings.
In the case of nominees of Financial Institutions,
the commission is paid to the Financial
Institutions.
As required by the provisions of 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
vi) Details of remuneration paid/payable to
These certificates have been placed on the
website of the Company.
Directors for the year ended March 31,
2013:
v) Remuneration Policy
(a) Executive Directors:
The remuneration of the Board members
is based on the Company’s size & global
presence, its economic & financial position,
industrial trends, compensation paid by the
peer companies, etc. Compensation reflects
each Board member’s responsibility and
performance. The level of Board compensation
to Executive Directors is designed to be
competitive in the market for highly qualified
executives.
The Company pays remuneration to Executive
Directors by way of salary, perquisites &
retirement benefits (fixed components) &
commission (variable component), based on
recommendation of the Committee, approval
of the Board and the shareholders. The
commission is calculated with reference to net
profits of the Company in the financial year
subject to overall ceilings stipulated under
Sections 198 & 309 of the Companies Act,
1956.
The NEDs are paid remuneration by way of
commission & sitting fees. The Company
pays sitting fees of
20,000 per meeting of
the Committee and the Board to the NEDs
for attending the meetings of the Board &
The details of remuneration paid/payable
to the Executive Directors is as follows:
Lakh
Commission
Names
Salary
Perquisites
Mr. A. M. Naik
Mr. K. Venkataramanan
Mr. V. K. Magapu ^
Mr. M. V. Kotwal
Mr. Ravi Uppal @
Mr. S. N. Subrahmanyan
Mr. R. Shankar Raman
Mr. Shailendra N. Roy
@ resigned as a whole-time director w.e.f. close of working hours of 15.09.2012.
^ retired as a whole-time director w.e.f. close of working hours of 30.09.2012.
1374.00
824.00
222.00
287.00
135.00
552.00
435.00
251.00
264.00
163.20
61.50
123.00
52.25
105.00
93.00
80.60
25.87
174.02
8.00
76.06
13.70
18.40
18.40
65.47
Retirement
Benefits
442.26
266.54
76.55
110.70
50.56
177.39
142.56
89.53
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
77
(b) Non-Executive Directors:
The details of remuneration paid/payable
to the Non-Executive Directors is as
follows:
Lakh
Commission
Total
Names
Sitting
Fees for
Board
Meeting
2.00
2.00
2.00
0.40*
2.00*
1.80
2.00
1.20
0.80
0.80
0.40
Sitting
Fees for
Committee
Meeting
1.80
1.80
1.60
1.00*
1.60*
1.80
2.00
0.80
0.20
0.20
0.20
44.05
36.00
37.00
15.00
37.00
42.00
30.75
US$ 1,17,780
15.00
19.70
5.63
Mr. S. Rajgopal
Mr. S. N. Talwar
Mr. M. M. Chitale
Mr. Thomas Mathew T. †
Mr. N. Mohan Raj
Mr. Subodh Bhargava
Mr. A. K. Jain
Mr. J. S. Bindra $
Mr. M. Damodaran #
Mr. Vikram Singh Mehta #
Mr. Sushobhan Sarker %
* Payable to respective Institutions they represent.
$ ceased to be a director w.e.f. 24.08.2012.
† ceased to be a director w.e.f. 19.11.2012.
# Appointed as an Additional Director w.e.f. 22.10.2012.
% Appointed as a Director w.e.f 15.12.2012
47.85
39.80
40.60
16.40
40.60
45.60
34.75
–
16.00
20.70
6.23
Details of shares and convertible
instruments held by the Non-Executive
Directors as on March 31, 2013 are as
follows:
Names
Mr. S. Rajgopal #
Mr. S. N. Talwar
Mr. M. M. Chitale
Mr. N. Mohan Raj *
Mr. Subodh Bhargava
Mr. A. K. Jain *
Mr. M. Damodaran
Mr. Vikram Singh Mehta
Mr. Sushobhan Sarker *
* held jointly with the Institution they represent
# has been granted 60,000 stock options but not yet exercised
No. of Shares held
900
6,000
1,086
200
500
400
100
590
100
3) Shareholders’/Investors’ Grievance
Committee:
i) Terms of reference:
The terms of reference of the Shareholders’/
Investors’ Grievance Committee are as follows:
Redressal of Shareholders’/Investors’
complaints
Allotment, transfer & transmission of
Shares/Debentures or any other securities
and issue of duplicate certificates and new
certificates on split/consolidation/renewal
78
etc. as may be referred to it by the Share
Transfer Committee.
ii) Composition:
As on March 31, 2013 the Shareholders’/
Investors’ Grievance Committee comprised
of 2 Non-Executive Directors and 1 Executive
Director.
iii) Meetings:
During the year ended March 31, 2013,
3 meetings of the Shareholders’/Investors
Grievance Committee were held on May 14,
2012, July 23, 2012 and January 25, 2013.
The attendance of Members at the Meetings
was as follows-
Name
Status
No. of
Meetings
Attended
No. of
meetings
during the
year
2
2
2
1
1
1
2
2
2
1
1
1
Chairman
Mr. A. K. Jain @
Member
Mr. V. K. Magapu ^
Member
Mr. Ravi Uppal $
Chairman
Mr. Vikram Singh Mehta *
Mr. Sushobhan Sarker *
Member
Mr. S. N. Subrahmanyan * Member
Meetings held during the year are expressed as number of
meetings eligible to attend.
@ Ceased to be a member w.e.f. 15.12.2012
* Inducted as a member w.e.f. 15.12.2012
^ Ceased to be a member w.e.f. 30.09.2012
$ Ceased to be a member w.e.f. 15.09.2012
Mr. N. Hariharan, Company Secretary is the
Compliance Officer.
iv) Number of Requests/Complaints:
During the year, the Company has resolved
investor grievances expeditiously except for
the cases constrained by disputes or legal
impediments.
During the year, the Company/its Registrar’s
received the following complaints from
SEBI/Stock Exchanges and queries from
shareholders, which were resolved within the
time frames laid down by SEBI.
Particulars
Complaints:
SEBI/Stock Exchange
Received
Resolved
Pending*
Opening
Balance
NIL
84
84
NIL
Particulars
Received
Resolved
Pending*
Opening
Balance
Shareholder Queries:
Dividend Related
Transmission/Transfer
Demat/Remat
*
995
29
1
6,556
1,074
446
6,781
1,066
446
770
37
1
Investor complaints/queries shown outstanding as on March 31,
2013 have been subsequently resolved. The substantial increase
in number of queries is on account of the Company’s repeated
reminders to shareholders regarding unclaimed shares and
dividends.
The Board has delegated the powers to
approve transfer of shares to a Transfer
Committee of Executives comprising of three
Senior Executives. This Committee held 49
meetings during the year and approved the
transfer of shares lodged with the Company.
G. OTHER INFORMATION
a) Training of Directors:
All our directors are aware and are also updated as
and when required, of their role, responsibilities &
liabilities.
The Company holds Board meetings at its registered
office and also if necessary, in locations, where it
operates. Site/factory visits are organized at various
locations for the Directors.
b)
Information to Directors:
The Board of Directors has complete access to
the information within the Company, which inter
alia, includes items as mentioned on Page 74 in
Annexure ‘C’ to the Directors Report.
Presentations are made regularly to the Board/N&R/
AC (minutes of AC & N&R are circulated to the
Board), where Directors get an opportunity to
interact with senior managers. Presentations,
inter alia, cover business strategies, management
structure, HR policy, management development
and succession planning, quarterly and annual
results, budgets, treasury policy, review of Internal
Audit, risk management framework, operations of
subsidiaries and associates, etc.
Independent Directors have the freedom to interact
with the Company’s management. Interactions
happen during Board/Committee meetings,
when senior company personnel are asked to
make presentations about performance of their
Independent Company/Business Unit, to the
Board. Such interactions also happen when these
Directors meet senior management in IC meetings
and informal gatherings.
c) 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.
d) Statutory Auditors:
The Board has recommended to the shareholders,
the re-appointment of Sharp & Tannan (S&T) as
auditors. S&T has furnished a declaration confirming
their independence as well as their arm’s length
relationship with the Company as well as declaring
that they have not taken up any prohibited non-
audit assignments for the Company. The Company
believes that S&T, over a period of time, has
gained extensive knowledge of the Company & its
diversified business, which is essential to ensure
audit quality & audit objectivity. Robust internal
control systems and risk management framework,
review of Auditors’ performance by the Audit
Committee and peer review of the Audit firm, are
some of the more important factors that prevent
audit failures. Mr. Milind P. Phadke has signed the
audit report for 2012-13 on behalf of S&T.
e) 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.
K. Venkataramanan
Chief Executive Officer & Managing Director
Date: May 8, 2013
Place: Mumbai
79
f) General Body Meetings:
The last three Annual General Meetings of the
Company were held at Birla Matushri Sabhagar,
Mumbai as under:
Financial Year
Date
Time
2011-12
2010-11
2009-10
August 24, 2012
3.00 p.m.
August 26, 2011
3.00 p.m.
August 26, 2010
3.00 p.m.
The following Special Resolutions were passed by
the members during the past 3 Annual General
Meetings:
Annual General Meeting held on August 24, 2012:
To approve appointment of Mr. A. M. Naik
as the Group Executive Chairman of the
Company.
To approve raising of capital through QIP’s
by issue of shares/convertible debentures/
securities upto an amount of USD 600 million
or 3200 crore.
To approve appointment of Statutory Auditors
and remuneration payable to them.
Annual General Meeting held on August 26, 2011:
To approve appointment of Statutory Auditors
and remuneration payable to them.
Annual General Meeting held on August 26, 2010:
To approve payment of commission to non-
executive directors not exceeding 1% of the
net profits of the Company.
To approve raising of capital through QIP’s
by issue of shares/convertible debentures/
securities upto an amount of USD 600 million
or 2700 crore.
To approve appointment of Statutory Auditors
and remuneration payable to them.
g) 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. Details of all related party transactions form
a part of the accounts as required under AS
80
18 and the same are given on page 189 to
page 200 of the Annual Report.
3. The Company has followed all relevant
Accounting Standards notified by the
Companies (Accounting Standards) Rules,
2006 while preparing the Financial Statements.
4. The Company makes presentations to
Institutional Investors & Equity Analysts on the
Company’s performance on a quarterly basis.
5. There were no instances of non-compliance
on any matter related to the capital markets,
during the last three years.
h) Means of communication:
Financial
Results
Quarterly & Annual Results are published in
prominent daily newspapers viz. The Financial
Express, The Hindu Business Line & Loksatta.
The results are also posted on the Company’s
website: www.larsentoubro.com.
News Releases Official news releases are sent to stock exchanges
as well as displayed on the Company’s website:
www.larsentoubro.com.
Website
Corpfiling
The Company’s
corporate 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.
Presentations made to Institutional Investors on
a quarterly basis and the quarterly shareholding
pattern of the Company is also displayed on
the website. The entire Annual Report and
Accounts of the Company and subsidiary are
available in downloadable formats. It will also
be made available on the websites of the Stock
Exchanges.
Information to Stock Exchanges is now being
filed through corp-filing. Investors can view
this information by visiting the website
www.corpfiling.co.in.
Annual Report Annual Report is circulated to all the members
and all others like auditors, equity analysts, etc.
Management
Discussion &
Analysis
This forms a part of the Annual Report which
is mailed to the shareholders of the Company.
H. UNCLAIMED SHARES
As required under Clause 5A of the Listing Agreement,
the Company had sent 3 reminders to the shareholders
whose shares were lying unclaimed/undelivered with
the Company. The Company has received a substantial
number of requests to claim these share certificates which
are released after a through due diligence. As on today,
the Company has only 1.43% of the total shareholders
whose shares are lying unclaimed/undelivered. These
will be transferred to the Unclaimed Suspense Account
as required under the Listing Agreement. The Company
has already opened the “Unclaimed Suspense Account”
and is in the process of completing the formalities for
transferring the shares.
I. GENERAL SHAREHOLDERS’ INFORMATION
a) Annual General Meeting:
The Annual General Meeting of the Company has
been convened on Thursday, August 22, 2013 at
Birla Matushri Sabhagar, Marine Lines, Mumbai –
400 020 at 3.00 p.m.
Limited (NSDL) and Central Depository Services
(India) Limited (CDSL).
g) Stock Code/Symbol:
The Company’s equity shares/GDRs are listed on
the following Stock Exchanges and admitted for
trading in London Stock Exchange:
Bombay Stock Exchange (BSE)
National Stock Exchange (NSE)
ISIN
Reuters RIC
Luxembourg Exchange Stock Code
London Exchange Stock Code
: Scrip Code-500510
: Scrip Code-LT
INE018A01030
:
:
LART.BO
: 005428157
:
LTOD
The Company’s shares constitute a part of BSE 30
Index of the BSE Limited as well as NIFTY Index of
the National Stock Exchange of India Limited.
b) Financial calendar:
h) Stock market data for the year 2012-13:
1. Annual Results of 2012-13 May 22, 2013
2. Mailing of Annual Reports
Third week of July, 2013
3. First Quarter Results
During the last week of July 2013 *
4. Annual General Meeting
August 22, 2013
5. Payment of Dividend
August 26, 2013
6. Second Quarter results
During last week of October, 2013 *
7. Third Quarter results
During last week of January, 2014 *
* Tentative
c) Book Closure:
The dates of Book Closure are from Friday, August
16, 2013 to Thursday, August 22, 2013 (both days
inclusive) to determine the members entitled to the
dividend for 2012-13.
d) Listing of equity shares/shares underlying
GDRs on Stock Exchanges:
The shares of the Company are listed on The BSE
Limited (BSE) and the National Stock Exchange of
India Limited (NSE).
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
2013-2014 to the above Stock Exchanges.
f) Custodial Fees to Depositories:
The Company has paid custodial fees for the
year 2013-2014 to National Securities Depository
Month
L&T BSE Price ( )
Low
High
Month
Close
BSE SENSEX
Low
High
2012
April
May
June
July
August
September
October
November
December
2013
January
February
March
)
(
E
S
B
-
T
&
L
2000
1900
1800
1700
1600
1500
1400
1300
1200
1100
1000
900
1,364.80
1,237.00
1,400.00
1,441.85
1,481.20
1,619.00
1,719.50
1,691.60
1,699.00
1,192.55
1,111.00
1,106.40
1,308.00
1,324.10
1,310.00
1,581.50
1,537.20
1,572.50
1,226.30
1,172.30
1,397.35
1,369.65
1,341.40
1,596.75
1,624.75
1,667.10
1,605.85
17,664.10
17,432.33
17,448.48
17,631.19
17,972.54
18,869.94
19,137.29
19,372.70
19,612.18
17,010.16
15,809.71
15,748.98
16,598.48
17,026.97
17,250.80
18,393.42
18,255.69
19,149.03
1,661.00
1,556.35
1,531.30
1,500.00
1,352.00
1,331.00
20,203.66
19,966.69
19,754.66
1,542.90
1,365.80
1,364.90
Stock Performance
L&T BSE ( ) BSE SENSEX
19,508.93
18,793.97
18,568.43
Apr
12
May
12
Jun
12
Jul
12
Oct
12
Sep
12
Nov
Aug
12
12
Daily Closing Price
Dec
12
Jan
13
Feb
13
Mar
13
Month
Close
17,318.81
16,218.53
17,429.98
17,236.18
17,429.56
18,762.74
18,505.38
19,339.90
19,426.71
19,894.98
18,861.54
18,835.77
23000
22000
21000
20000
19000
18000
17000
16000
15000
14000
13000
X
E
S
N
E
S
E
S
B
81
formalities by the Company from Practicing
Company Secretary has been submitted to Stock
Exchanges within stipulated time.
k) Distribution of Shareholding as on March 31,
2013:
No. of Shares
Upto 500
501 – 1000
1001 – 2000
2001 – 3000
3001 – 4000
4001 – 5000
5001 – 10000
10001 & ABOVE
TOTAL
Shareholders
Number
8,07,166
25,466
7,473
4,178
2,080
4,059
1,876
1,853
Shareholding
%
Number
94.50
5,91,95,330
2.98
1,86,38,938
0.87
92,50,728
0.49
74,29,147
0.24
47,01,462
0.48
1,42,65,079
1,31,83,323
0.22
0.22 48,87,21,974
8,54,151 100.00 61,53,85,981
%
9.62
3.03
1.50
1.21
0.76
2.32
2.14
79.42
100.00
l) Categories of Shareholders is as under:
Category
31.03.2013
31.03.2012
No. of
Shares
%
No. of
Shares
%
Financial Institutions 18,79,45,375
30.54 19,65,45,867
32.09
Foreign Institutional
Investors
Shares underlying
GDRs
10,20,52,770
16.58
9,56,38,792
15.62
220,48,741
3.58
1,90,99,263
3.12
Mutual Funds
3,42,05,671
Bodies Corporate
4,41,01,953
Directors & Relatives
26,57,738
5.56
7.17
0.43
2,64,30,606
4,29,38,374
28,36,544
4.32
7.01
0.46
L&T Employees
Welfare Foundation
7,44,04,116
12.09
7,44,04,116
12.15
General Public
14,79,69,617
24.05 15,45,05,337
25.23
TOTAL
61,53,85,981 100.00 61,23,98,899 100.00
Month
L&T NSE Price ( )
Low
High
Month
Close
High
1,367.20
1,237.00
1,401.00
1,442.00
1,481.70
1,619.80
1,720.00
1,690.00
1,699.00
1,192.00
1,109.45
1,106.05
1,307.90
1,324.35
1,309.05
1,307.25
1,536.10
1,572.60
1,226.85
1,172.60
1,397.80
1,369.40
1,342.90
1,596.80
1,626.85
1,667.90
1,607.15
5,378.75
5,279.60
5,286.25
5,348.55
5,448.60
5,735.15
5,815.35
5,885.25
5,965.15
1,661.30
1,555.45
1,532.30
6,111.80
6,052.95
5,971.20
1,499.00
1,351.25
1,333.50
1,541.85
1,367.80
1,366.20
Stock Performance
L&T NSE ( ) NSE NIFTY
2012
April
May
June
July
August
September
October
November
December
2013
January
February
March
)
(
E
S
N
-
T
&
L
2000
1900
1800
1700
1600
1500
1400
1300
1200
1100
1000
900
NIFTY
Low
5,154.30
4,788.95
4,770.35
5,032.40
5,164.65
5,215.70
4,888.20
5,548.35
5,823.15
5,935.20
5,671.90
5,604.85
Month
Close
5,248.15
4,924.25
5,278.90
5,229.00
5,258.50
5,703.30
5,619.70
5,879.85
5,905.10
6,034.75
5,693.05
5,682.55
6500
6250
6000
5750
5500
5250
5000
4750
4500
4250
4000
Y
T
F
I
N
E
S
N
Apr
12
May
12
Jun
12
Jul
12
Oct
12
Sep
12
Nov
Aug
12
12
Daily Closing Price
Dec
12
Jan
13
Feb
13
Mar
13
i) Registrar and Share Transfer Agents (RTA):
Sharepro Services (India) Private Limited, Andheri,
Mumbai.
j) Share Transfer System:
The share transfer activities under physical mode
are carried out by the RTA. 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 and completed 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.
As required under Clause 47-C of the Listing
Agreement, a certificate on half yearly basis
confirming due compliance of share transfer
82
m) Dematerialization of shares:
The Company’s Shares are required to be
compulsorily traded in the Stock Exchanges in
dematerialized form. The Company had sent letters
to shareholders holding shares in physical form
emphasizing the benefits of dematerialization.
The number of shares held in dematerialized and
physical mode is as under:
No. of shares % of total
capital
issued
Held in dematerialized form
in NSDL
Held in dematerialized form
in CDSL
Physical
Total
57,42,49,023
93.32
2,50,77,504
4.07
1,60,59,454
61,53,85,981
2.61
100.00
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.
The Company has the following Foreign Currency
Convertible Bonds outstanding as on March 31,
2013:
3.50% USD 200 million Foreign Currency
Convertible Bonds due 2014
(i)
(ii)
(iii)
(iv)
(v)
Principal Value of the Bonds issued
Principal Value of Bonds converted to
GDRs since issue
Principal Value of Bonds outstanding as
at March 31, 2011
Underlying Equity Shares/GDR’s issued
pursuant to conversion as per (ii) above
Underlying Equity Shares/GDR’s that
may be issued pursuant to conversion
notices in respect of (iii) above
USD 200 million
NIL
USD 200 million
NIL
49,07,243 shares
These Convertible Bonds are listed on the Singapore
Exchange Securities Trading Limited.
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) and/or BSE Limited (BSE).
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:
The L&T Group’s facilities for design, engineering,
manufacture and modular fabrication are based
at multiple locations within India including
Ahmednagar, Bangalore, Chennai, Coimbatore,
Faridabad, Hazira (Surat), Katupalli (Ennore),
Raigad, Rourkela, Mumbai, Mysore, Pithampur,
Puducherry, Talegaon and Vadodara. L&T’s
manufacturing footprint covers the Gulf (Oman,
Saudi Arabia, Dubai), South East Asia (Malaysia,
Indonesia) China and Australia. The L&T Group also
has an extensive network of offices in India and
around the globe.
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 : Larsen & Toubro Limited
Samhita Warehousing Complex,
Bldg. No.13 A B, 2nd Floor
Off Sakinaka Telephone Exchange Lane,
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@shareproservices.com
83
2. Sharepro Services (India) Private Limited
Unit : Larsen & Toubro Limited
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 designated an exclusive e-mail
id viz. IGRC@LARSENTOUBRO.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 & Remuneration Committee is in
place since 1999. The Committee comprises of
five 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.
3. Access to the Audit committee of the Board is
also available.
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. Directors and designated employees who
buy and sell shares of the Company are prohibited
from entering into an opposite transaction i.e sell or
buy any shares of the Company during the next six
months following the prior transactions. Directors
and designated employees are also prohibited from
taking positions in the derivatives segment of the
Company’s shares.
Mr. N. Hariharan, Company Secretary has been
designated as the Compliance Officer.
v)
ISO 9001:2008 Certification:
The Company’s Secretarial Department which
provides secretarial services and investor services
for the Company and its Subsidiary and Associate
Companies is ISO 9001:2008 certified.
w) Secretarial Audit:
As stipulated by SEBI, a Qualified Practising Company
Secretary carries out Reconciliation of Share Capital
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.
The secretarial department of the Company at
Mumbai & Chennai (overseeing all companies in
Infrastructure Development Projects), are manned
by competent and experienced professionals. The
Company has a system to review and audit its
secretarial and other compliances by competent
professionals, who are employees of the Company.
Appropriate actions are taken to continuously
improve the quality of compliance.
The Company also has adequate software and
systems to monitor compliance.
84
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
(Issue 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, 2013 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 propose to be taken for rectifying
these deficiencies.
(d) We have indicated to the Auditors and the Audit Committee:
(i) Significant changes in accounting policies made during the year ended 31st March 2013 and that the same have
been disclosed suitably in the notes to the financial statements; and
(ii) that there were no instances of significant fraud of which we have become aware.
R. Shankar Raman
Chief Financial Officer
Yours sincerely,
K. Venkataramanan
Chief Executive Officer &
Managing Director
A. M. Naik
Group Executive Chairman
Place: Mumbai
Date: May 22, 2013
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
31 March 2013 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 the 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 explanation 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 the management has conducted the affairs of the Company.
Mumbai, May 22, 2013
SHARP AND TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
85
Notes
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Management Discussion & Analysis 2012-13
Global Economic Condition :
In the year 2012-13, the global economy continued to be
in the throes of challenges and uncertainties. There was a
divergence in growth and prospects across geographies as
both governments and central banks attempted to revive
fledgling growth. To some extent growth was supported
by aggressive monetary easing measures by the central
banks of developed economies which also encouraged
capital flows into emerging markets.
Not overlooking the old dangers and new turbulence in
the global markets, the near-term risk picture however
has improved as recent policy actions in Europe and US
have addressed some of the serious short-term risks. Over
the past six months, policymakers of advanced economies
have successfully defused two of the biggest short-term
threats to the global recovery viz. the threat of a Euro area
breakup and a sharp fiscal contraction in the US caused by
a plunge off the “fiscal cliff”.
The year also witnessed a noticeable slowdown in the
emerging economies, a reflection of slack demand in the
advanced economies, domestic policy tightening amidst
inflationary conditions and end of investment boom in
some of the major emerging economies.
Economic performance across the Middle East and North
Africa (MENA) was mixed in 2012. Political uncertainty
continued to weigh on the economies of the MENA
region. Growth in 2012 however increased to above the
2010 levels largely driven by recovery in the oil exporting
countries. In 2013, while slower growth is projected in oil
& gas production due to lower global oil demand, healthy
growth is expected in non-oil sectors.
The Omani economy continued to grow at a rapid pace.
The Government has entered into the second year of the
Eighth Five-Year development plan (2011-2015) allocating
USD 6.50 Billion a year for large public investment
programs, particularly in infrastructure and social sectors.
This is enabling the economy to sustain the domestic
demand and strengthen the economic diversification
program.
While the world economy is expected to grow at a better
pace than the last few years with activity gradually
accelerating in major advanced economies, with US in the
lead, the overall global economic environment still remains
fragile although the balance of risk is now less skewed to
the downside than in the recent years. The short-term risks
are lower as hard landing of the key emerging economies
has receded. Nonetheless, medium term risk still abounds
due to very low growth or stagnation in the Euro area;
probability of fiscal trouble in the US or Japan; risks related
to unconventional monetary policy; and lower potential
output in key emerging market economies.
Overview of Indian Economy :
The Indian economy in 2012-13, witnessed a decadal low
growth in GDP of 5.0%. The country has seen economic
expansion drop since the start of the 2011 to levels even
below the crisis years of 2008-09. The slowdown which
started in the industrial sector also extended to services
sector which has been the mainstay of India’s growth story.
The weakness in the economy is not only cyclical but also
structural in nature. Domestic supply bottlenecks and policy
obstacles have seen growth decelerate and investment
and industrial output slump. Global uncertainties also
adversely affected growth. The pipeline of new investment
dried up and existing projects stalled due to bottlenecks
and implementation gaps. Also, the country continued
to face persistent challenges due to high inflation, tight
monetary policy and the deteriorating external balance.
Despite good capital inflows in 2012-13, the economy
reported worrisome current account deficit.
A slowdown was witnessed in almost all the sectors of the
economy in 2012-13. While the moderation in growth in
agriculture (1.9%) was largely on account of the rainfall
deficiency, the deceleration of industrial production
growth to 1.2% in 2012-13 from 2.7% in 2011-12 was
mainly due to contraction in mining and slowing growth
in manufacturing and electricity sectors. Capital goods
segment continued its dismal performance in 2012-13,
indicating the lack of investment demand in the economy.
The services sector saw a further deceleration to a growth
of 6.8% in 2012-13 as compared to 7.9% mainly on
account of a slowdown in trade, transport, hospitality and
financial services.
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The spurt in the economic growth of the country in the
past was led by the consumption story. However, along
with investment slowdown, India now faces a challenge
of a consumption led slowdown. Government expenditure
growth decelerated from 8.6% in 2011-12 to 3.9% in
2012-13 due to the fiscal consolidation by the government
to reduce the deficit. The impact on fiscal deficit hence
was immediate as it fell to 4.8% of GDP compared to the
target of 5.2%. The private final consumption expenditure
which has the largest share in the GDP of 60% also slowed
down to a growth of 4.0% in 2012-13 from 8.0% in
the previous fiscal. The investments throughout the fiscal
continued to remain in gloomy territory with growth in
gross fixed capital formation being just at 1.7% in 2012-13
as against 4.4% in 2011-12.
Business Scenario :
Delayed policy measures, slow-down in industrial
production, persistently high interest rates and liquidity
concerns adversely impacted the investment climate in
India in 2012-13. Consequently, the commitments on
capital expenditure and fresh investments were deferred,
impacting growth prospects of businesses of the Company
operating in certain sectors such as Power, Minerals and
Metals, Defence and Fertilizer. The sectoral bottlenecks
also had an impact on progress on a few ongoing projects.
Product businesses of the Company, recorded low sales
performance on account of sluggish industrial demand.
The businesses of the Company faced intense competition
from domestic as well as international players constraining
the ability of the prices to absorb the cost increases.
Despite the economic challenges, the Company has
managed to sustain its growth momentum during 2012-13
on the back of proven track record, presence in diverse
sectors and forays in the select international markets.
•
The infrastructure development is an irreversible process
for energising growth in India. The Government has
reiterated its commitment to kick-start delayed projects
in the infrastructure space. The Government has also taken
measures to reduce fiscal deficit to provide stability and
protect the credit standing. New investments are expected
in Transport Infrastructure, Urban Infrastructure, Oil & Gas,
Fertilizer, Renewable Energy sectors.
Speedy resolution of issues relating to mining, land
acquisition, implementation of Power sector reforms,
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private sector participation in indigenisation and defence
manufacturing will boost the Company’s prospects.
Growth Strategies and Thrust Areas :
• Business Structure and Strategic Plan :
The Company structure is well-crafted and is providing
necessary focus to encash growth opportunities.
Businesses have drawn strategic plan “Lakshya 2016”
and are taking initiatives to enhance performance and
long term value creation.
•
Strengthening Execution & Operational
Efficiency :
The businesses have taken up various initiatives for
cost optimization and productivity enhancement.
Operational excellence, smart contract management
are key focus areas to improve margins on large sized,
long cycle jobs under execution.
• Capacity Augmentation :
The Company has been investing in capacity ramp-up
in emerging businesses as well as its core business
to enhance execution capabilities. The Company has
undertaken capital expenditure in 2012-13 mainly
to acquire plant & machinery for its Engineering and
Construction businesses.
During the year, the Shipbuilding cum port facilities
at Kattupalli, Tamil Nadu, have commenced its
commercial operations. The Special Steel & Heavy
Forgings facility, being one of the longest forging
facilities in the world, has also been commissioned.
International Business :
On the international front, the countries in the
Middle East, South Asia, select markets in CIS region,
and Africa hold good prospects. The businesses
are focusing on securing pre-qualifications and
strengthening of international organization. Higher
share of international business provide excellent
de-risking opportunities and necessary impetus to
the performance of the Company. The international
business, however, poses various challenges in
terms of stiff competition pressures on delivery time
lines and margins, volatility in the exchange rates,
compliance with the local laws, requirements of local
sourcing etc.
• Human Resource Development :
The Company strives to be an Employer of Choice. High
quality recruitment supports the talent management
practices of the Company. To augment the journey
of internationalisation of the Company and create a
multicultural work force, strengthening leadership
cadre with appropriate domain competencies has
been done, particularly in the Middle East and for
other growth areas.
High potential and high performing employees
continue to be developed through a six-step leadership
development module. The Company continues to
foster a high performance culture by recognising good
performers and providing them with career enhancing
opportunities. Several HR initiatives have been taken
for the strategic alignment of the HR function with
the business objectives. These initiatives encompass
employee engagement, learning & development
besides improved internal communication mechanism
with employees. The Company’s Project Management
Institute in Baroda hosts several programs on project
execution excellence to complete projects in time
and within cost and is directly linked to the vision of
the Company of being a global player in its project
businesses.
Accordingly, the Company is positioned well for growth
and to create value for all its stakeholders. It is in this
background that the Company’s various businesses present
their operations review for the year 2012-13 as under :
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Hydrocarbon Business
Mumbai High North Complex of ONGC, executed by L&T on an EPC basis. The massive complex comprises a process platform, a living quarters
platform & control room, three process gas compression platforms, two flare platforms and two jackets including one weighing 13,500 tonnes.
Overview :
The Hydrocarbon business provides complete EPC
solutions for the global Oil & Gas Industry. It possesses
the capabilities to deliver end-to-end solutions for every
phase of project – from front end design engineering
through fabrication, project management, procurement,
construction, installation right up to commissioning.
Integrated strengths coupled with an experienced and
highly skilled work force, are the key enablers in repeatedly
delivering large, complex projects.
The capabilities of the Hydrocarbon business includes
in-house engineering, R&D centre, engineering joint
ventures with reputed international companies, offshore
installation capabilities, world class modular fabrication
facilities, an experienced & competent project execution
team and a safe work culture. The key aspects of business
philosophy are excellence in corporate governance, high
quality standards, best in class HSE protocol, IT security
practices, timely execution and cost competitiveness.
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The business has major work centres in India at Powai
(Mumbai), Vadodara, Chennai, Bengaluru, Faridabad,
Hazira and Kattupalli. It has established its presence in
Middle East and South East Asia. Internationally, it has
a fabrication facility at Sohar (Oman), project execution
capabilities in the UAE (Abu Dhabi and Sharjah), Muscat
(Oman), Qatar (Doha), Al-Khobar (Kuwait and Saudi
Arabia) and business development offices at Houston,
London, Singapore, South Korea, Australia, Malaysia and
Indonesia.
The Hydrocarbon business is structured into the following
three Strategic Business Groups (SBGs) :
• Hydrocarbon Upstream
• Hydrocarbon Mid & Downstream (HMD)
• Hydrocarbon Construction & Pipelines (HCP)
Hydrocarbon Upstream :
The Hydrocarbon Upstream SBG provides turnkey solutions
to the offshore Oil & Gas industry encompassing well-head
platforms, process platforms & modules, subsea pipelines,
brown field developments, floating systems & offshore
drilling rigs. The SBG has successfully executed large
offshore platforms and pipeline projects in east and west
coast of India, Middle East, South East Asia and Africa for
global companies such as ONGC, GSPC, Songas, Qatar
Petroleum, Maersk Oil Qatar, PTTEP, Petronas and Bunduq.
The SBG has also established experience in the Jack-up rig
refurbishment and is qualified to build new Jack-up rigs,
floating production storage & off-loading (FPSO) topsides
and subsea projects.
The Upstream SBG has three state-of-the-art fabrication
facilities at strategically important locations for modular
structures, heavy jackets and oil rigs offering round-the-
year delivery. Hazira, near Surat in Gujarat, caters to
business opportunities in the West Coast of India (Mumbai
High). Kattupalli near Chennai in Tamil Nadu caters to
opportunities from East Coast (KG Basin) and South East
Asia. Sohar at Oman caters to opportunities in the MENA
region. These yards have a total fabrication capacity of
about 150,000 MT per year.
L&T’s heavy-lift-cum-pipelay vessel LTS 3000 installing a topside for
Newfield Peninsula in Malaysia.
The SBG has business development offices at Abu Dhabi,
Singapore, Houston and Perth to provide the necessary
thrust for its international growth vision. Additionally, the
SBG is exploring upcoming opportunities in the CIS region
and East Africa.
The SBG through a joint venture (JV) with Sapura Crest
Petroleum Bhd, Malaysia, owns and operates a Heavy
Lift Pipe Lay vessel, LTS3000, enhancing its offshore
installation capabilities. The three engineering centres at
Bengaluru, Chennai and Faridabad housed in its wholly
owned subsidiary, L&T Valdel, along with a centralized
procurement capability centre at Mumbai enable the SBG
to offer integrated EPC services to E&P companies.
During the year, the SBG bagged two projects from ONGC
to be executed in the West Coast of India. It also got
a second order from Myanmar, this time for Petronas
Carigali, Yetagun North field.
The SBG recently completed installation for PTTEPI &
GSPC-PLQP project and also sail-out of refurbished rig
(Sagar Uday) for ONGC. The largest order from ONGC
for Mumbai High North Complex of USD 1.2 Billion, was
successfully commissioned during the year.
Hydrocarbon Mid & Downstream (HMD) :
Hydrocarbon Mid & Downstream SBG provides a
wide range of EPC solutions for hydrocarbon refining,
petrochemical and fertilizer (ammonia & urea complexes)
sectors.
Multiple
large value projects can be executed
simultaneously by HMD on a turnkey basis with detailed
engineering support drawn from L&T-Chiyoda Limited –
an associate company of L&T and in-house Engineering
Resource Centers located at Mumbai, Faridabad and
Vadodara, which house over 1500 experienced engineers
catering to the complete spectrum of feed, process and
detailed engineering.
HMD has rich experience of project execution with
technologies from process licensors like UOP, Axens,
Haldor Topsoe, CB&I Lummus, Black & Veatch, Ortloff,
ExxonMobil, BOC Parsons, Du-Pont (Invista) & Davy
Process Technologies. In addition, strategic alliances with
internationally renowned companies has helped to be a
strong contender for the Fertilizer projects.
Carrying forward the internationalization initiative,
business development capabilities have also been
established in CIS countries, South East Asia and Korea
in addition to the existing ones at Sharjah and Al-Khobar.
HMD is prequalified by major international Oil & Gas
producers such as Saudi Aramco, ORPC, Petronas, Dragon
Oil, Pertamina & KNPC, for their large value upcoming
projects.
91
HMD has reinforced its foot prints in the Middle East by
bagging repeat order from PDO Oman for Onshore Gas
Processing project for Saih Rawl facilities. Additionally,
HMD has successfully bagged a project for gas processing
facility from Dolphin Energy, Qatar.
HMD achieved record commissioning of 7 projects during
the year (MRPL DHT & HGU, NFL Panipat & Bhatinda,
ONGC Uran, CPCL Toyo & GNFC) of which NFL Bhatinda
and Panipat were commissioned ahead of time. The other
major projects approaching completion are the world scale
Aromatic Complex at ONGC Mangalore Petrochemicals
Ltd (OMPL), Reactor Regenerator Package as part of FCC
unit for IOCL Paradip & ONGC Uran gas processing facility.
Hydrocarbon Construction & Pipelines (HCP) :
Hydrocarbon Construction & Pipelines SBG undertakes
lump-sum turnkey projects for cross-country pipelines for
Oil & Gas and construction of refinery, petrochemicals,
chemical plants, fertilizers, gas gathering stations, crude
oil & gas terminals, underground cavern storage systems
for LPG.
HCP has world class engineering capabilities undertaken
through its JV with Gulf Interstate Engineering of USA for
cross-country pipeline construction. Additionally, major
capabilities include heavy lift competency, automatic
welding and world class quality adherence. HCP has
strategically invested in plant and machinery and key
construction equipment such as All Terrain Cranes of
various capacities, pipe layers and entire range of pipeline
spreads, earth moving equipment and automatic welding
machines.
To cater to the needs of international market, especially in
GCC, HCP has setup local partnership ventures of repute
in Kingdom of Saudi Arabia, Kuwait and Oman.
Internationally, HCP has been executing various projects
for key customers such as GASCO (UAE), ADCO (UAE),
SADARA [Kingdom of Saudi Arabia (KSA)], KOC (Kuwait),
Dolphin Energy (Qatar), Petroleum Development Oman
(Oman), Oil Tanking Odfjell Terminal Company (Oman),
either directly or through other EPC contractors. Domestic
clientele include Cairn, HMEL, RIL and Indian PSU oil
companies.
Business Environment :
The domestic business environment continues to remain
uncertain. Though the government has initiated some
policy decisions, its impact on investments is yet to be
seen. Large value fertilizer orders and onshore gas
processing orders have got repeatedly deferred. Due to
limited opportunities available, competition tends to be
aggressive. Operational excellence initiatives are helping
the business to improve its competitiveness.
The international business segment continues to be very
active and several projects are slated for tendering in the
near term particularly in KSA, UAE and Oman. Also, new
geographies identified offer growth opportunities, though
the award of projects may take longer.
Significant Initiatives :
During the year, the business achieved several pre-
qualifications for major upcoming projects in KSA, UAE,
Kuwait and entered into strategic alliances with major
EPC bidders for targetted projects. Operational excellence
measures such as productivity monitoring,integrated
project execution, knowledge management across
projects, effective contract management, optimum
inventory management are undertaken for projects under
execution.
The business continued to engage key business
development personnel and international business heads in
select geographies. Also, the Company is in the process of
establishing branch/representative offices in Turkmenistan
and Indonesia. During the year, an In-Kingdom EPC
Company was registered in Saudi Arabia in order to bid
for projects reserved for In-Kingdom Company.
Habshan-Ruwais-Shuweihat Pipeline being executed on an EPC basis
in Abu Dhabi. L&T has constructed over 4,000 km of pipeline across
some of the world’s toughest terrain.
Health, Safety and Environment are core values for
hydrocarbon business. The business strives for continuous
improvement for the protection and development of
92
health, safety, and environmental assets of its employees
and stakeholders. During the year, the business continued
its thrust on the safety cultural transformation through
various initiatives. Through its robust HSE Management
System and dedicated organizational support led
by committed leadership, the business continued to
emphasize on the Zero Incident Credo. Despite working
at peak, with 110 million man-hours being clocked, the
business achieved zero fatality during the year. Eight
projects were commissioned safely without any reportable
incident during the year.
Various training programs were conducted at offices &
project sites on key topics including safety in design. A
world class Safety Innovation School was inaugurated at
Hazira to enhance the safety competency of the personnel
through experiential and innovative learning process.
Various internal & external audits were conducted during
the year to monitor the implementation of various safety
systems at the project sites along with a close follow
up for closure of the recommendations. Campaigns on
various on-job and off-job safety issues such as Traffic
Safety, Home Safety along with Environmental issues
were conducted during the year. Environment protection
remains a priority for the business and various initiatives
adopted at office campuses and project sites have led
to significant conservation of precious resources such as
energy and water.
During the year, a number of international safety
certifications were achieved, which are vital in view of
the growing international operations. The business won
several recognitions, accolades and appreciations on safety
from clients and national and international agencies,
which includes National Safety Council, American Society
of Safety Engineers, British Safety Council & RoSPA. MFF
Hazira & MFY Sohar Fabrication Yards have received the
prestigious Green Banding & Amber Banding respectively
for its sustainable safety systems from M/s. SHELL through
OGP pre-qualification assessment methodology.
The Hydrocarbon business has a strong resource base
of skilled and experienced people working in various
disciplines. HR efforts are targeted to ensure that the right
talent is sourced, selected, trained and deployed across the
organisation. Special efforts are being put to identify high
potential leaders and groom them through six stages of
leadership development to take on higher responsibilities
in the future.
As a part of its drive towards building international project
management capabilities, several senior professionals
have been recruited from top notch international EPC
companies during the year. Today, one out of every 5
people working in the Gulf countries for the business is a
foreign national.
900 tpd ammonia plant of National Fertilizers Limited, Panipat - one of the many downstream hydrocarbon projects executed by L&T, on a licence
plus EPC basis
93
L&T’s modular fabrication facility at Sohar in Oman has the capability to execute large scale fabrication up to 20,000 tonnes. Picture shows a
jacket, a platform and a jack up rig.
Hydrocarbon business has set up an in-house training
Centre at the Sohar Yard, Oman for training local people
in trades such as Welders, Crane Operator, Riggers,
Electricians and Safety Marshals. Since inception, 450
locals have been trained. In addition, L&T Sohar yard in
collaboration with Ministry of Manpower, Oman plans to
provide welder training to young people on a continuing
basis.
The Hydrocarbon business has institutionalised risk
management processes with clear policies and guidelines
and usage of quantitative tools to enhance/protect
operating margins. The Risk Management process is
aimed at identification, assessment, mitigation and
monitoring risks from pre-bid to execution stage and also
capturing learnings after project close-out. Industry-wide
tools like Palisade, @Risk, Primavera Risk Analysis are
deployed for cost estimation and schedule risk analysis to
94
enhance quantitative risk management. The challenges
in the form of growing competition, newer geographies,
forex and commodity price fluctuations and manpower
attrition are effectively mitigated through specific actions
like operational excellence initiatives, appointing local
representatives in target countries, proactive hedge
management and employee engagement programmes.
L&T is one of the sponsor members for Engineering and
Construction Risk Institute (ECRI), USA-an initiative of
World Economic Forum which has sponsor membership
of 37 leading global companies from Engineering and
Construction industry. Project Managers/Project team
members of the business are undergoing certified Risk
Induction Programme conducted by ECRI (Engineering &
Construction Risk Institute) on a continuous basis to get
acquainted with Global Best Practices in Engineering &
Construction Risk Management.
Outlook :
With oil prices expected to be steady, rising demand for
oil & gas from the developing world, the business believes
that there will be a revival in Oil & Gas capex in FY14,
resulting in expected increase in award activities. Also, the
business observes a trend of increasing brown field jobs
due to ‘Enhanced Oil Recovery’ requirements of existing
fields. Gradual depletion of shallow water prospects
makes it imperative to be ready for deepwater offerings.
L&T SAPURA SHIPPING PRIVATE LIMITED (LTSSPL) :
Subsidiary Company :
LTSSPL is a JV between L&T and Nautical Power Pte Ltd,
Singapore, a wholly owned subsidiary of Sapura Crest
Petroleum Bhd, Malaysia, formed in September 2010
with L&T holding 60% equity stake. This JV operates
Heavy Lift cum Pipe Lay Vessel (HLPV), named LTS3000,
for installation of offshore platforms and laying of sub-sea
pipelines.
The business has established a good presence in the
Jack-up rig refurbishment market and is now looking at
new build Jack-ups & FPSO Topsides collaborating with
leading players in the field. Focused emphasis is being laid
on developing sub-sea business segment, possibly through
alliances.
Government has cleared the Urea Investment Policy
2012, which augurs well for investments in this sector.
Accordingly, sustained investments in this sector through
Brownfield Urea expansion projects in lump-sum turnkey
mode is expected.
Good opportunities are also visible in onshore gas
processing projects especially in India and refinery
expansion projects both in India and Overseas.
Large investments are also expected in cross-country
pipeline projects over the next three to five years. The
business is confident of capturing the market given its
strength in in-house engineering, key strategic equipments
and experienced workforce.
Pipelines prospects are increasing in KSA, Oman and Iraq
while such prospects have reduced in UAE and Qatar. New
gas finds in Oman coupled with Government’s keenness
to develop more fields is an encouraging sign.
Major Subsidiary and Associate Companies
L&T-VALDEL ENGINEERING LIMITED (LTV) :
Subsidiary Company :
LTV, wholly owned by Larsen & Toubro (L&T), is an
engineering solutions arm specializing in upstream oil &
gas. It is diversified along full value chain of engineering
– Concept, FEED, Pre-bid support, Detailed Engineering,
As-built, Yard support and installation support engineering
– for a wide range of offshore facilities : Process Platforms,
Well-heads, FPSO topsides, shallow and deep-water
pipelines, Jack-up Rigs, and extensive brown-field projects.
During the year, LTV has succeeded in getting repeat orders
from its major customers, while adding new customers.
During the year, the vessel (LTS3000) has successfully
installed 10 offshore structures (5 Jackets & 5 topsides) and
laid over 56 kms of sub-sea pipeline at various oil fields
in Malaysia and Myanmar, registering highest utilisation.
L&T MODULAR FABRICATION YARD LLC, OMAN
(LTMFYL) :
Subsidiary Company :
LTMFYL is a JV between Zubair Corporation & L&T,
established in the Sultanate of Oman. L&T, through its
wholly owned subsidiary Larsen & Toubro International FZE,
holds 65% in the company. Its core competencies include
fabrication of large size Offshore Platforms, Jack-up Rigs,
Floating Production Storage & Offloading (FPSO) Modules,
Integrated Decks, Skid Mounted Equipment, Onshore
Process Modules etc. LTMFYL is now a major fabrication
service provider in the Middle East and international
offshore oil & gas industry, comparable with the biggest
fabrication yards in the region.
The yard was optimally utilised during the year with major
fabrication work for PTTEP and ADMA OPCO projects as
well as lay-up and repair work for Jack-up Rig for ONGC
is underway.
LARSEN & TOUBRO ATCO SAUDIA LLC (L&T ATCO) :
Subsidiary Company :
L&T ATCO is a JV between L&T and Abdulrahman Ali Al-Turki
Group of Companies (ATCO) Dammam, a renowned
Saudi conglomerate. L&T ATCO was incorporated as an
In-Kingdom Company in 2007 to take advantage of the
electro-mechanical construction opportunities arising in
the areas of Oil & Gas, Petrochemicals, Power and Water
related projects in Saudi Arabia. L&T, through its wholly
owned subsidiary Larsen & Toubro International FZE holds
a 49% stake in the company.
The Company has achieved pre-qualifications for major
upcoming projects of Saudi Aramco and SABIC. During
the year, Company has bagged project for Wasit Gas
Development from SK Engineering & Construction Co. Ltd.
95
The Company is currently executing the SADARA project,
bagged in the previous year.
LARSEN & TOUBRO ELECTROMECH LLC (L&T
Electromech) :
Subsidiary Company :
L&T Electromech is a JV between L&T and The Zubair
Corporation, Oman (TZC). L&T, through its wholly owned
subsidiary Larsen & Toubro International FZE holds 65%
in the company.
The Company is a leading Civil, Mechanical and
Electrical & Instrumentation Construction Company
in Oman undertaking projects in Oil & Gas, Refineries,
Petrochemicals, Power and Water Treatment sectors.
The Company achieved growth during the year mainly
on account of good order book and a number of orders
received. It is currently executing two major jobs,
one from DALEEL Petroleum for Power Generation &
Distribution Facility and another for PDO Lekhwair Gas
Field development project, besides O&M jobs.
LARSEN & TOUBRO KUWAIT CONSTRUCTION
GENERAL CONTRACTING COMPANY WLL (LTKC) :
Subsidiary Company :
LTKC is a JV between L&T and M/s Bader Almulla and
Brothers Company WLL. L&T, through its wholly owned
subsidiary Larsen & Toubro International FZE, holds 49%
in the Company. LTKC executes construction projects in Oil
& Gas and Power sectors in the State of Kuwait.
During the year, LTKC has received an order from Kuwait
Oil Company (KOC) for New GC 16 Cluster Development.
Currently, it is also executing the construction portion in
Effluent water Injection/Sea water injection job of KOC
being executed by Petrofac.
L&T-CHIYODA LIMITED (LTC) :
Associate Company :
LTC is an internationally reputed Design & Engineering
Consultancy catering to the Hydrocarbon Processing
Industry. LTC was set up in the year 1994 as a JV between
Chiyoda Corporation of Japan and L&T with an equal
stake.
LTC offers total engineering solution to hydrocarbon 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.
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Buildings and Factories Business
Crescent Bay - an elite residential project coming up in the heart of Mumbai, India’s commercial capital.
Overview :
Buildings & Factories (B&F) business undertakes engineering
design and construction of Airports, IT Parks, office spaces,
educational institutions, stadiums, convention centers,
metro stations, hospitals, hotels, residential buildings,
factories, cement plants and warehouses.
The thrust is on focused development in various building
segments and expanding customer base by providing
“Concept to Commissioning” solutions. This helps
in maintaining the leadership position, retaining key
customers, entering new markets and securing major
orders. Construction excellence coupled with technology,
experience and expertise gained over several decades
has established B&F business as one of the premium
contractors in the industry.
Business Environment :
Despite a global economic slowdown and lower GDP
growth in India, B&F business stood out in the market
during 2012-13 with impressive growth in terms of
revenue and order book.
The B&F business saw a considerable growth in the order
book in residential segment due to the increased focus in
affordable housing and real estate development in Tier II
cities along with the metros. It leveraged upon the same
by bagging a number of major orders and expanding its
geographical presence. In IT space segment, the business
was able to match the order inflow plans despite weak
economic scenarios in US and Europe which adversely
affected the expansion plans of IT companies. The year
was challenging for some segments like factories and
airports. In factories segment, companies preferred split
up packages with low project value. For airport segment,
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major domestic airport projects got delayed due to hurdles
in land acquisition.
After strengthening itself in Mumbai, the residential
business unit has marked a pan-India presence by bagging
major orders from leading real estate developers across
the country. In factories segment, B&F business received
a major order to construct a defence facility. In airports
segment, it bagged orders to construct the passenger
terminal building in Chandigarh and Sindhudurg. In IT
space, orders were bagged to construct IT Parks for major
IT companies. In institutional segment, the business was
successful in winning a bid to construct a new campus
for the Indian Institute of Technology (IIT). B&F business
also received orders to construct 5-star hotels for major
hospitality companies. It strengthened its position in UAE
by bagging a major order for construction of a specialty
hospital in Abu Dhabi for NMC Healthcare, thereby
increasing its international share.
Some of the key projects commissioned by B&F business
during the year include ITC Grand Chola, a 5-star luxury
hotel in Chennai, Elante mall in Chandigarh, ATC Tower
and a single span hangar for Mumbai International
Airport, IT Parks in Chennai and Gandhinagar, GIFT City
in Gandhinagar, cement plants and river view apartments
in Lucknow.
Significant Initiatives :
Apart from continuing its focus on emerging trends in
technological enhancements, B&F business also targeted
to sharpen its business strategy. Key moves were made in
order to have a better picture on emerging markets, new
businesses and strategic tie-up. Strategic initiatives had
been planned and implemented by each business unit to
spread across geographies, improve operational excellence
and expand customer portfolio. In order to harness new
opportunities in Africa and the Kingdom of Saudi Arabia
(KSA), new offices were setup in Nairobi in Kenya and
Riyadh in KSA.
With the thrust to bridge the gaps in the niche areas for
business growth and enhance project execution capabilities
through an integrated human resource approach,strong
focus was laid on talent acquisition while hiring expats,
professionals, and students from premier institutes.
Customised programs were conducted for the employees
in order to address the skill gaps through a number of
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in-house training and development programs. Employee
performance was also reviewed through a sophisticated
performance management system. Various workmen
management centers have been set up in order to improve
their skills and increase work efficiency.
Institutionalising strong internal control mechanisms
covering total operations has been the thrust areas of
the business. Further, it has well documented policies and
guidelines for evaluation and authorisation of tenders
being submitted/work orders and purchase orders being
placed. B&F business has constituted a separate cell to
monitor various business processes at project locations for
identifying and rectifying any weaknesses observed.
Outlook :
Some key decisions by the Government are expected
to facilitate major prospects in the coming years. The
Government has decided on increasing fund allocation to
health sectors, setting up new educational institutions,
allowing FDI in aviation and retail and relaxation in floor
space index in high rise structures. All these decisions create
favorable scenarios for sectors like IT space, hospitals,
institutional space, aviation, mixed use development and
residential space.
In the private sector, IT companies’ plans to expand into
non-metros and expansion plans by auto, pharmaceutical
and cement companies will add to business prospects.
In order to capitalise on the positive outlook for 2013-14,
B&F business has taken steps to strengthen its presence
in UAE and Oman and also establish its footprint in other
countries such as Africa, Kuwait, Bahrain, Qatar and KSA
by forming strategic tie-ups and targeting major orders.
Major Subsidiary Company
LARSEN & TOUBRO OMAN LLC (LTO) :
Subsidiary Company :
LTO is a JV with Muscat Trading Company LLC (Zubair
Corporation Group), providing engineering, construction
and contracting services for over 15 years in Sultanate of
Oman. The Company has an excellent track record in civil
projects and continues to enjoy customer preference in the
country. L&T, through its wholly owned subsidiary Larsen &
Toubro International FZE holds 65% in the company. B&F
business is one of the major business segments of LTO.
During the year 2012-13, LTO bagged major orders in
Residential and Institutional segments from clients like
GLOREI, Royal Court Affairs and Ministry of Defence. Some
of the key projects commissioned in Oman are German
University and Ministry of Manpower Head Quarters in
Muscat.
The completion of major prestigious projects within
stringent timelines, demonstrates B&F business’ superior
project management and project execution capabilities in
handling large design build and turnkey projects.
Prospects appear attractive in segments like Airports,
Residential, Institutional space and commercial buildings
as major orders are in pipeline in these segments. Based on
positive economic scenario in Oman and its proven track
record, LTO is well positioned for expanding the business
portfolio in the region.
Scale and splendour at the new Elante Mall in Chandigarh
L&T Business Park at Powai, Mumbai
One of multiple high rise residential and commercial complexes being
built by L&T that are changing the skyline of Mumbai
L&T offers a single point, design-to-build solution for the infrastructural
needs of the entire manufacturing sector
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Transportation Infrastructure Business
An elevated road corridor decongests the bustling metropolis of Nashik. L&T undertakes a wide range of critical infrastructure projects
Overview :
Infrastructure business comprises
Transportation
of four business units namely, Roads, Runways &
Elevated Corridors, International Infrastructure, Railway
Construction & Railway Systems. It maintains leadership
as premier construction major in both the transportation
infrastructure sectors of Road & Rail in India. Transportation
Infrastructure business has consolidated its presence and
made considerable inroads in the Gulf in the year 2012-13.
Business Environment :
Due to the continuing policy inaction and sluggish
economic scenario in India, much of the mega projects
have been delayed in recent past posing a challenge for
new BOT orders in the domestic market. In smaller EPC
projects and railway projects the competition remains
intense due to a large number of players with aggressive
bidding strategies. In international market a lot of local
players with huge asset base are chasing new projects.
Strategic tie-ups with local players appears imperative for
achieving success.
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Major orders bagged in 2012-13 include Delhi Agra Road
Project-179.5 Km, Amravati Jalgaon Road Project, KMDA
Project, Sindhudurg Airport, various Railway Construction
Projects and Infra projects in UAE-ADAC. In Railway
segment, the business captured 41% of Rail Vikas Nigam
Limited (RVNL) Market in the year 2012-13. Dedicated
Freight Corridor Corporation (DFCC) has come to a
decisive phase of contract award for CTP 1 & 2.
Four Unincorporated Joint Ventures (UJVs) have been
formed with Darwish, Sraiya, Delma & Hashemi in UAE and
Qatar for Roadway Projects. Two JVs have been formed
with Fujita and Ansaldo for Etihad Rail & Riyadh Metro for
Railway Projects respectively.
Significant Initiatives :
The business has rolled out operational excellence measures
for all domestic as well as international projects. Key
operational excellence initiatives include cost reduction and
productivity improvement in subcontracting, procurement,
manpower cost reduction, improved equipment utilisation
L&T’s capabilities in bridge-building include design and construction of many types of bridges of different span lengths using innovative techniques and
construction methods.
and optimisation, deployment of better construction
methodology & lean processes, enhancing efficiency in
project management and contract management. For
improved optimisation of resources the business has
adopted the approach of cluster as an operational centre
whereby each cluster of projects will be supported by
strong sub-contractor base and smart mobilisation model
for optimum utilisation of assets & manpower during
preconstruction period.
Strengthening in-house design capabilities is one of the
major thrust areas and the business has taken several steps
in this regard.
Outlook :
The business sees good prospects in road, rail sector in the
year 2013-14. A few large NHAI road projects and a major
EPC package from DFCC are on anvil.
Further, the Cabinet Committee on Investment is set up, to
resolve issues in infra projects greater than 1000 crore.
This will expedite processes of granting environment and
forest clearances for mega projects. NHAI has expressed
willingness to compensate Developers/Contractors for
delays in projects caused by the circumstances beyond
their control, which will revive the BOT project space.
In addition, the 12th five year plan mentioned the formation
of the master plan for expressways to be developed for both
the passenger and freight movements in the high traffic
density corridors. Also National Expressway Authority of
India expected to be formed to take up initiatives for both
the land acquisition and to get the work executed under
the BOT mode.
In Rail Sector, there is a thrust on doubling and
electrification by Indian Railways. Large opportunities
are expected out of expansion of Delhi Metro Phase III
and other new upcoming metro projects such as MEGA,
Ahmedabad and Kochi Metro.
Sheikh Khalifa Interchange - linking the emirates of Abu Dhabi and Dubai.
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On the international front, thrust of the Governments in
Gulf region on infrastructure projects both in Roadways
and Railways is expected to open up more opportunities in
UAE, Qatar, Oman & Kuwait. Several projects which have
been tendered in the recent past in UAE and Oman and
the thrust on infrastructure development is expected to
continue at steady pace in these countries. Qatar projects
are likely to kick start in later part of 2013-14.
With its top class engineering and execution the business
is targeting growth in the order inflow and revenue in
2013-14.
Major Subsidiary Company
LARSEN & TOUBRO OMAN LLC (LTO) :
Subsidiary Company :
The economy in Oman continued its growth in a sustained
manner during 2012-13. The Government of Oman has
allocated funds for large public investment programs,
particularly in infrastructure and social sectors. LTO is
targeting large value road and expressway orders from
upcoming projects in Oman. The company is expanding
Plant & Machinery base considering the expected
investments by Government of Oman in large infrastructure
projects.
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Heavy Civil Infrastructure Business
L&T is constructing India’s first monorail network in Mumbai – India’s commercial capital. The project involves design, construction, installation,
testing and commissioning the 19.7-km corridor on a turnkey basis. This includes project management, civil work, DC traction systems, interface
management, automatic fare collection system and E&M services.
Overview :
Heavy Civil Infrastructure business undertakes design,
engineering and construction of projects in Metros, Ports,
Tunnels, Special Bridges, Hydro Power, Nuclear Power and
Defence infrastructure sectors.
Business Environment :
The year 2012-13 saw limited tenders in many of the
business segments such as Ports, Hydel and Nuclear due
to delays in policy decisions and financing of large scale
projects.
However, the business recorded good performance and
succeeded in achieving most of its plan with its focussed
approach. The operational and financial performance of
the business reflected healthy growth in 2012-13. Some
of the major orders secured during the year 2012-13
include various underground and elevated packages of
Delhi Metro project, 171 MW Lata Tapovan Hydropower
project in Uttarakhand, 850 MW Ratle Hydropower Project
in Jammu & Kashmir, Natural Draught Cooling Tower
package of Kakrapar Nuclear Power Project 3 & 4, Design
& Construction of C17 Beddown Infrastructure facilities,
Taxiways, Aprons and other Buildings etc. at Hindan Air
base, Ghaziabad.
Some of the key projects completed by the business
include Kattupalli port cum shipyard facilities in Tamil
Nadu, 520 MW Parbati HEP in Himachal Pradesh, etc. The
business has also achieved substantial completion of works
in 330 MW Srinagar HEP in Uttarakhand, Elevated Corridor
at Nashik, Bangalore metro, Kudankulam Nuclear Power
Project (unit 1&2) etc.
Significant Initiatives :
Heavy Civil Infrastructure business has undertaken several
initiatives to improve the cost competiveness with clear
focus on supply chain management, operational excellence,
value engineering and improved capacity utilisation. The
other initiatives include thrust on project monitoring and
operations by placing capable organisation structure and
exclusive team building for contracts administration.
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The Rajasthan Atomic Power Plant. L&T has supplied critical equipment and built almost every nuclear power plant in India.
Ports are part of the wide portfolio of major infrastructure projects built by L&T.
Heavy Civil Infrastructure business has also taken several
steps to enter international markets especially in the
Middle East. It has made project specific tie-ups for such
international projects and it is participating in tenders for
Qatar and Riyadh metros. Attracting and retaining talent
with requisite competencies and focusing on training and
development to enhance productivity are the key focus
areas to support the business needs.
Outlook :
Given the huge gap between infrastructure demand and
supply in a growing economy like India, all businesses
relating to heavy civil infrastructure are likely to witness
good growth over a sustained period.
With the specific and continuous thrust on business
development, the business is looking at new opportunities
across various business segments in India as well as in the
international markets. The healthy order book position of
Heavy Civil Infrastructure business gives the confidence
of registering a substantial growth in revenues during the
year 2013-14.
Major Subsidiary Company
L&T GEOSTRUCTURE LLP (LTGS) :
Subsidiary Company :
LTGS was formed in 2012-13 under Heavy Civil
Infrastructure business. The LLP is a joint venture (JV) with
Transworld Infraprojects Private Limited with Larsen &
Toubro (L&T) holding 74% stake. LTGS undertakes projects
in the business areas of ground engineering namely soil
investigation, deep excavation, earth retaining structures,
piling, ground improvement, microtunneling, mine shafts
and other related activities.
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Metallurgical & Material Handling (MMH) Business
Coal handling plant executed by L&T at Koderma in Jharkhand. L&T is a single point solution provider for a comprehensive range of material
handling systems.
Overview :
Metallurgical & Material Handling (MMH) business
undertakes EPC (Engineering, Procurement & Construction)
projects for ferrous (iron & steel making) and non-ferrous
(aluminium, copper, lead & zinc) metal industries, bulk
material & ash handling systems in power, port, steel
and mining sector. It has a well-established Industrial
Machinery & Foundry work shop at Kansbahal, Odisha and
a fabrication shop at Kanchipuram, Tamil Nadu to cater to
the specific requirements of the customer.
Business Environment :
Economic scenario has been generally challenging with
the down-trend in investments during the year 2012-13,
impacting fresh order intake by the business. Moreover,
it is also experiencing keen competition from overseas
players like China and other break-way countries of
erstwhile USSR.
Braving the challenging business environment, the
business has not only retained its market leadership but
also enhanced its market share during the year 2012-13.
MMH business has been partnering various steel producers
in their capacity expansions, which added another 10
Million Tons per annum domestic production capacity in
the year 2012-13. Some of the major plants executed by
MMH business and commissioned in FY 2012-13 are :
Sinter Plant (2*204 sqm) for IISCO, Burnpur; Sinter Plant
#3 (360 sqm) for SAIL, Rourkela; Blast Furnace (3813 cum)
for RINL, Visakhapatnam; Pellet Plant (6 MTPA) for Tata
Steel, Jamshedpur; ‘I’ Blast Furnace (3 MTPA) for Tata
Steel, Jamshedpur; LD shop for Tata Steel, Jamshedpur;
Sinter Plant (204 sqm) for Bhushan Steel, Angul and 4
MTPA Dry Circuit Material Processing (DCMP) Plant for
Tata Steel, Joda. Material Handling Business Units of
MMH business have also been supporting the major
power producers commission their projects and the major
ones commissioned in the year 2012-13 are Unit#1-Coal
Handling Plant (6*150 MW) for Hindalco, Mahan; Unit #
1 to 3-Coal Handling Plant (5*660 MW) for Adani Power,
Tiroda; Unit#1-Coal Handling Plant (5*270 MW) for
Indiabulls Power, Amravati; Unit#4-Coal Handling Plant
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(2*500 MW) for NTPC, Simhadri Stage-2 and Unit#2-Coal
Handling Plant (2*500 MW) for DVC, Koderma.
MMH business managed to stay ahead of its competitors in
the major bids in the year 2012-13 including Beneficiation
& Pellet Plant, Coke Oven Rebuild for SAIL; Ore Handling
Plant for OMC; secured orders for Coal & Ash Handling
Plant for RRVUNL, Chhabra (L&T Power); Coal Handling
Plant for BIDCO TPS, Lalitpur; Port Handing Facility for
Adani.
MMH business is currently executing major metallurgical
projects at Kalinganagar & Jamshedpur for Tata Steel, at
Bhillai for SAIL, at Angul for Bhushan Steel, at Bellary for
JSW, at Angul for JSPL, at Rayagada for Utkal Alumina and
at Mahan for Hindalco.
Material Handling packages at Lalitpur for BIDCO, at
Rajpura for Nabha Power Thermal Power Plant, at Anpara
for UPRUVNL, at Raigarh for DB Power, at Tiroda for Adani
Power Limited, at Joda & Noamundi for Tata Steel, at
Tuticorin for NTPL and 10 other Material Handling Plants
are being executed concurrently for various customers.
With the inclusion of Industrial Machinery & Foundry
Business Unit, Kansbahal, MMH business has forayed
into high end customised manufacturing needs of steel,
power & other metallurgical sector customers. The
primary products of Kansbahal includes Surface Miner,
Crushing Systems, Paper Machinery, Apron Feeder and key
equipment for coke oven, pellet and steel making segment.
The business is now fully equipped for manufacturing of
High end Equipment for metallurgical sector involving
Heavy fabrication, intricate castings, precision machining
and critical assembly. The fabrication shop at Kanchipuram
continues to provide the support and strength of heavy
fabrication and assembly of Material Handling Equipment
like Stackers, Reclaimers and host of other mid precision
level equipment catering to the steel and other process
plants.
Key success factor for the business is high customer
retention, operational efficiency and consistent
performance.
It is establishing international organisation to tap the large
business potential in the Middle East market in ferrous,
non-ferrous and material handling sectors. The business
has successfully secured orders in JSIS-Oman and EMAL-
UAE in 2012-13. It intends to carry forward this initiative
with impetus to explore newer geographical locations in
Sub-Sahara Africa and South-East Asia.
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Coke Oven Battery at one of India’s major seel plants.
Limestone crusher manufactured by L&T
Blast furnace at Vizag Steel Plant. The company undertakes detailed
engineering, procurement, manufacture, supply, construction,
erection and commissioning of projects in the areas of ferrous and
non-ferrous metals and mineral beneficiation.
Significant Initiatives :
MMH business has made strategic alliance with leading
global technologist as a part of business line diversification
in ferrous segment which include :
•
Paul Wurth-For Blast Furnace, Coke Oven and
By-Product Plant;
• Outotec-For Sinter plant and Pellet plant;
• Nippon Steel-For Coke-dry- quenching and
Continuous Annealing & Proceeding line;
• METSO-For iron ore beneficiation.
To avail new concept & technology for increased capacity
in material handling sector, MMH business has technology
tie-ups with global technologists which include :
• Ashton Bulk, UK-for crescent type wagon tipplers,
high capacity side-arm-chargers and ducking tripper
type stacker reclaimer;
• Norwest, US-for coal waheries;
•
• UCC, US-for ash handling system.
FLCE, France-for long belt conveyors;
Efforts are on to strengthen the team of domain experts
in the significant target business segments to build core
competency and in-house technology capability. Further,
after embarking on an operational excellence program
to enhance productivity and cut cost of operations, the
roll out at various projects and departments have started
bearing fruit.
Outlook :
Land and mining reforms and renewed investments in
the field of Ferrous, Non-Ferrous, Ports and Power sector
will be key drivers for Metallurgical & Material Handling
business.
In spite of the current slowdown, Steel industry has been
performing well in India and is expected to witness increase
in demand in the year 2013-14. Government’s initiatives
to boost private investment in Power & Port sector likely
to bring fresh inflow of capital. Investment allowance of
15%, coal block linkages, developing ports in PPP mode
are precursor to revival of the sector.
The business has aligned itself towards providing solution
on Value added/debottlenecking efforts of industry majors,
focusing upon operation agility during this challenging
scenario. With the opening order book and expected
orders during the year, the business is confident of posting
good performance in 2013-14.
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Power Transmission & Distribution (PT&D) Business
L&T executes a wide variety of transmission line projects across some of the world’s toughest terrain.
Overview :
The PT&D business is a leading EPC player in the field
of Power Transmission and Distribution business offering
integrated solutions and end-to-end services ranging from
design, manufacture, supply installation and commissioning
of transmission lines, substations, distribution networks,
electrical & instrumentation works for power, process &
infrastructure projects, communication systems in both
domestic & international markets.
Industrial Electrification Business Unit provides turnkey
electrical, Instrumentation & Communication (E&IC)
solutions for major power plants including Thermal &
Nuclear plants, Process plants, Hydro carbon & Pipeline
Projects, IT Parks, Airports, Sea Ports, Metros, Intra City
Power Transmission Network etc.
Substation Business Unit focuses on providing turnkey
solutions for Power Evacuation schemes from Power
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plants, Main Grid Substations for Utilities, Power
Distribution & Power Quality Improvement works under
Rural Electrification (R-APDRP, RGGVY schemes) Projects.
Transmission Line Business offers turnkey solutions in
building Transmission lines for Power Evacuations Systems,
boosted by its state-of-the-art tower manufacturing units
at Puducherry and Pithampur with a total installed capacity
of 1 lakh tpa & complemented by its tower testing facility
at Kanchipuram.
PT&D’s International Business Units in Gulf Countries
namely UAE, Qatar, Kuwait, Oman & Saudi Arabia offer
complete solutions in the field of High Voltage Substations,
Power Transmission Lines, EHV Cabling, E&IC Works for
Infrastructure Projects such as Airports, Oil & Gas Industries
etc.
Business Environment :
During the year 2012-13, power scenario in India
continued to be very challenging. Power generation sector
plagued by many unresolved policy issues resulted in no
major investments.
Fuel shortages, stringent land clearance & environmental
norms & a host of other issues are affecting capacity
additions in power generation while the financial
performance of state utilities affected transmission sector,
imposing constraints in order inflow.
Even in this challenging environment, the business
managed to secure major orders from central utilities such
as PGCIL, NPCIL, state utilities and other private players
in Generation, EHV transmission & distribution segment.
The business also identified new and exciting opportunities
in LV Power distribution Segments, which are funded by
Central Government funding agencies. Utilities have
embarked upon strengthening their respective distribution
networks for better accountability. The focus on this
segment has fetched good dividends by securing major
orders from various state utilities & DISCOM’s.
The business was also successful in tapping the potential
available in electrification works of Process Plants & Urban
Mass Transit (Metro) Projects.
Volatility in commodity prices, higher interest rates and
inflation had an impact on the performance of PT&D
business.
In the international arena the PT&D business bagged
significant orders in UAE & Qatar. The business however
was unable to realise the full potential due to deferred
decision making and delayed award.
Major orders secured during 2012-13 include 765 kV
Substations at Bara & Lalitpur for Jaypee & BIDCO
respectively, 765/400 kV, 400/220 kV Substation at various
locations across India for PGCIL & TNEB, Power Distribution
& Quality improvement works under Rural Electrification
schemes for various DISCOM’s & State utilities such as
Punjab, West Bengal, Karnataka etc.
Major Transmission Line projects include 800 kV HVDC
Line from Champa to Kurukshetra, 400kV Line from
Kurukshetra to Jalandhar, Barh to Gorakhpur & Biharsharif
to Sasaram for PGCIL.
Industrial Projects include E&I Works for HSM, SMS & RMHS
packages for Tata Steel & E&I Works for Blast Furnace for
NMDC, prestigious order for Field Instrumentation Works
for NPCIL Kakrapar Atomic Plant,11 kV & 22 kV Ring
Main Distribution Network for TANGEDCO, Electrical &
Mechanical Works for Bangalore Metro Network.
On the order inflow front in international market, PT&D
business achieved a major breakthrough in 220 kV
Segment in UAE by securing 220/33 kV Grid Station at
Zakher & Ayn Al Faydha for AADC in addition to 132kV
GIS substations for FEWA. The business also bagged a
prestigious order to execute 11 kV Power Distribution
Network for Emirates Palace.
A major breakthrough in Airport Segment in Gulf Market
was attained by securing Special Airport System Package
for Concourse 4 of Dubai International Airport and
also E&I Works for Abu Dhabi Airport Airside works.
International orders include 132 kV GIS Substation & 33 kV
Power Distribution Network orders from Qatar Petroleum
& 220/66 kV GIS substation and associated EHV Cabling
Package from KAHRAMAA in Qatar.
The PT&D business also installed & commissioned first of
its kind 1200kV National Test Station at Bina for PGCIL,
48 No’s of 500MVA, 765/400kV transformers were
commissioned at various substations of PGCIL across India,
400/132kV Bulk Power Receiving Station for TATA, the
first of its kind 132kV Hybrid GIS substation for RRVPNL,
765kV Transmission Line from Agra to Jatikalan for
PGCIL, 400kV Transmission Line from Korba to Bhillai for
CSPTCL, 400kV Transmission Line from North Chennai to
Almathy for TANTRANSCO, Electrical & Instrumentation
works for Bhushan Steel plant, Rourkela Steel Plant for
SAIL & Burnpur Steel Plant for ISP, Synchronized Unit-1
of 2x500MW Mauda TPP for NTPC, Unit -3 of 6x660MW
Sasan TPP for Reliance.
In international operations, PT&D business commissioned a
major electrical project comprising EHV & MV Power System
Network for Qatar Petroleum and 132kV GIS substation
for KAHRAMAA. The business also commissioned a 132kV
Substation for DEWA, 7 No’s 33/11kV Substations in Al
Ain, 3 No’s 33/11kV Substation for ADPC along with the
first ever 220 kV Substation & overhead Line to a private
consumer in Bahrain.
Significant Initiatives :
In its continuing efforts to improve operational excellence,
PT&D business developed and launched many project
management tools such as :
•
EDMS (EIP Document Management System, an online
tool for engineering process);
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•
SST (Supply Schedule Tracker, an online tool for
Procurement monitoring);
• PRIME (Project Review & Information Management
Enterprise, a progress monitoring tool) in the domestic
BU’s;
Rolled out animation video on transmission line
stringing procedure as a part of the endeavor for
workmen skill development;
•
• Also, on a pilot basis EPPM (Enterprise Project Portfolio
Management-Primavera) has been launched in our
overseas operations.
The PT&D business is targeting to diversify its portfolio
in GCC countries and is exploring opportunities in infra
electrics segment and has been successful in bagging
initial orders in this segment.
As part of PT&D business’s internationalisation strategy
to expand into new geographies, dedicated business
development teams have been deployed across strategic
locations in Africa & South East Asia to identify & strongly
pursue emerging potential.
Outlook :
In domestic market, good business prospects exist as
Government policies lay stress on Power System Grid
Strengthening Schemes through Central & Multilateral
funding agencies. Central & State Utilities are likely to
proceed with their Investment Plans. Debt Restructuring
Plan of DISCOM’s/State Utilities and power tarif revisions
will also pave way for financial health revival & faster
project implementation. Power Distribution & Power
Quality Improvement Projects under Rural Electrification
Schemes will drive the business in MV & LV Distribution
Segment.
Key drivers for growth are likely to emerge from the
opportunities in Steel, Cement and Oil & Gas Sector by
way of various Greenfield and Brownfield projects, telecom
& EHV Power Cabling Networks, Metros etc.
400 kV GIS Switchyard, NTECL Vallur of 3 x 500 MW Thermal Power
Plant
Switchyards are part of L&T’s capability in executing projects for power transmission and distribution
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GCC investment plans on Grid Strengthening &
infrastructural development continues to be in line with
economic development, offering substantial potential.
intensifying power demand in Africa & South East
Asian countries unleashes significant potential and new
opportunities.
Major Subsidiary Company :
LARSEN & TOUBRO OMAN LLC (LTO) :
Subsidiary Company :
LTO is a JV with Muscat Trading Company LLC (Zubair
Corporation Group), providing engineering, construction
and contracting services for over 15 years in Sultanate of
Oman. LTO has well established itself in the PT&D business
in Oman. The Company has been awarded the prestigious
“Infrastructure project of the year” award by Construction
Week, Oman for the 220 kV Grid station & TL Jhaloot
Project. This is a great achievement for PT&D business,
given the technical challenges in execution of the project.
LTO is well positioned to harness the upcoming
opportunities in Oman in PT&D segment supported by
proven track record and strong construction capabilities.
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Water & Renewable Energy Business
L&T has wide experience in design and construction services for water processing, transmission and distribution facilities.
Overview :
The Water & Renewable Energy business comprises Water
& Effluent Treatment Strategic Business Group (SBG) and
Renewable Energy Business Unit (BU). These two diverse
lines of businesses provide services covering the entire
value chain (Concept to Commissioning) and are playing
important roles in creating a water-surplus, energy-secure
and green future.
The Water & Effluent Treatment SBG caters to turnkey
infrastructure projects in Water Supply & Distribution,
Waste Water Collection, Treatment, Disposal, Re-Use
and Industrial & Large Water Systems. Furthermore,
the business also has presence in Gulf countries, where
cutting-edge technologies are being deployed for Water
and Waste Water Treatment projects.
The Renewable Energy BU provides turnkey EPC services
for projects on Utility-scale Photovoltaic/Concentrated
Solar Power Plants, Decentralized Solar PV Systems, Wind
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Power Plants, Micro-grids, Smart-grids and Integrated
Security Solutions. The BU has plans to expand to Gulf
nations where substantial investments are envisaged in
Solar industry.
Business Environment :
Recognizing the urgent need for building quality water
infrastructure and tapping clean sources of energy,
governments across the globe are coming out with policies
encouraging investment in these sectors.
In India, major water infrastructure projects are being
promoted by local governing bodies (State Governments
and Municipalities) with support from the Central
Government under innovative schemes like Jawaharlal
Nehru National Urban Renewal Mission (JNNURM)
and funding from international agencies like Japan
International Cooperation Agency (JICA).
The Water & Effluent Treatment SBG has affirmed its
status as a leading player in Water Infrastructure projects
in India in 2012-13. Major projects commissioned in
2012-13 include a 20 MGD Water Treatment Plant in
Delhi for Delhi Jal Board (DJB), Barmer Water Supply
Scheme in Rajasthan and Utkal Alumina Water Supply
Scheme in Odisha. Also, fresh orders have been secured
which include Cuttack Sewerage Scheme for Odisha
Water Supply and Sewerage Board (which includes micro-
tunneling of 10 km), 25 MGD and 50 MGD Water Supply
Schemes for Gujarat Industrial Development Corporation
(GIDC) at Dahej, Water Supply Schemes to five districts in
Rajasthan for PHED, Sewerage Scheme in Bhatpara Town
under National Ganga River Basin Authority (NGRBA) for
Kolkata Municipal Development Authority in West Bengal,
Hanamapur Lift-Irrigation Scheme for Krishna Bhagya Jala
Nigam Ltd. (KJBNL) in Karnataka and 110 MGD Raw Water
Pumping Station, Raw Water Transmission Main, 50 MGD
Water Treatment Plant & Clear Water Pumping Station at
Kolkata for Kolkata Municipal Corporation.
For Renewable Energy projects, some challenges are
technology risk of solar module performance, weak
compliance towards Renewable Purchase Obligations
(RPOs), demand for crashed project timelines and
operational and logistical hurdles due to remoteness
of sites. Intense competition from emerging local and
experienced international players is also a major challenge.
The Renewable Energy BU is executing a 125 MW Solar
Thermal Power Project, the largest of its kind in Asia,
based on Compact Linear Fresnel technology provided by
Areva, for Reliance Power. Apart from the above, a 20
MW Solar Photovoltaic (PV) Plant has been commissioned
for Kiran Energy at Phalodi, Rajasthan and a 17 MW Solar
PV Plant has been commissioned for Malpani Group at
Pokhran, Rajasthan. Also, new orders have been secured,
which include a 55 MW Solar PV Plant for Kiran Energy
in Tamil Nadu under REC mechanism and a 20 MW Solar
PV Plant for another leading developer in Rajasthan. With
over 300 MW of Solar projects executed/under-execution
Thermal desalination plants are part of L&T’s capabilities in the water sector
India’s largest solar plant built by L&T in Rajasthan.
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till date, L&T is the first and only Indian company to enter
the list of leading international Solar EPC players as per a
report published by IMS Research.
Significant Initiatives :
The Water & Renewable Energy business has grown at
a good pace in previous years and looks set to grow
sustainably in the future. Some initiatives that have been
taken to drive growth are :
1. Expansion of presence in India to new states by
formation of new project clusters;
2. Targeting new geographies to tap emerging
opportunities in water and renewable energy sectors;
3. Focus on emerging businesses like Desalination,
Water Management and Solar Thermal Applications;
4. Deploying best-in-class technologies such as Micro-
tunneling, Tracker-based projects, Micro-grids for
achieving market differentiation.
The business is also differentiating from competition
its customer-oriented, quality-conscious
through
and technology-driven approach towards business.
Benchmarks are being created for operational excellence
through efficient internal systems and processes.
Outlook :
Rapid urbanisation and industrialisation in India is
providing impetus for creation of efficient and reliable
Water infrastructure for supply of potable water and
collection, treatment & re-use of waste water. Stringent
pollution control norms and their enforcement is also a
major driver for investment in effective effluent-treatment
systems. Also substantial investments are envisaged in lift-
irrigation projects. It is encouraging to note that more than
15,000 crore have been earmarked for various water
supply and sewerage projects in India in 2013-14.
The demand for clean and green sources of energy is on
the rise. The National Action Plan on Climate Change
(NAPCC) envisages a 15% mix of renewable energy in
India by 2020. The 12th five year plan (2012-2017) has
targeted a capacity addition of 15 GW in Wind sector.
The Jawaharlal National Solar Mission has targeted a total
installed capacity of 20 GW of grid-connected Solar plants
by 2022. The year 2013-14 is going to see a large PV
capacity of around 4000 MW being allocated in India. For
Wind Power projects, the reinstatement of Generation-
based Incentives (GBIs) is expected to give impetus to
investments. With expected thrust on Renewable Purchase
Obligation (RPO) compliance, restructuring of financials
of state distribution companies and augmentation of
transmission and distribution infrastructure, the renewable
energy sector looks all set for a period of accelerated
growth. Also, the business environment for Integrated
Security Solutions looks bright with tenders being floated
by various government authorities for city surveillance
systems, intelligent traffic monitoring systems and security
systems for critical infrastructure setups like nuclear power
plants and airports.
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Power Business
L&T’s joint venture with Mitsubishi Heavy Industries introduced world-class supercritical technology to India. L&T is rapidly building a presence
in India in pursuit of its mission to become the ‘most preferred provider of equipment, services and turnkey solutions for fossil-fuel-based power
plants in the Indian market’.
Overview :
Power business is an integrated concept-to-commissioning
solutions provider for thermal power plants engaged
in setting up of coal and gas based power generation
projects on a lump sum turnkey basis. With world
class manufacturing facilities for supercritical boilers,
steam turbines, generators, pressure piping, axial
fans, air-preheaters and electrostatic precipitators, and
an unparalleled experience in project management,
engineering & construction management, the business
has the capability to cater to 85% (by value) of the power
generation value chain.
The business has an organization structure dovetailed for
performance with focused business units supported by
competency-based capability centers and service functions.
Geographically, the business has a pan-India presence with
multiple project sites and project management centers at
Vadodara, Faridabad and Chennai. The manufacturing
facilities for critical piping and electrostatic precipitators
are located at Hazira. The facilities for boilers, turbines,
generators, axial fans and air preheaters (housed in
joint venture companies) are also located at Hazira. The
business has set up establishments in various locations in
India to assist business development, with procurement
being supported by a China office.
The Company is a significant domestic player in the power
market, with substantial investments in manufacturing
capacity for supercritical power equipment. Multinational
companies have also taken steps to create India facilities by
tying up with or acquiring a local company. With these,the
domestic supercritical manufacturing capacity is slated to
cross 25,000 MW by 2014-15.
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Business Environment :
The year 2012-13 witnessed weak environment with
continuing problems of coal and gas supply, land acquisition
hurdles and regulatory uncertainty. The inflation levels,
which remained high for better part of the year, and the
resulting high interest rates further contributed to the
subdued sentiment. As a result, IPPs vanished from the
market, leading to a slump in order prospects. Excluding
NTPC Bulk orders which were announced in previous years,
the total ordering in 2012-13 was a meager 6,600 MW.
In response to industry demand for duty imposition on
imported power equipment, the government imposed
21% duty (5% basic customs duty + 12% countervailing
duty + 4% special additional duty) on power equipment
imports. Consequently, excise duty of 12% has also been
levied on domestic suppliers,due to which the overall
benefit of duty imposition has been diluted. To counter
this duty imposition, foreign suppliers have started utilizing
their competitive advantage of low interest rates to bundle
low-cost financing as an additional offering to owners.
The gas output of the country reached all-time low in
2012-13. This has led to a near shutdown of the gas-based
power market in the nation. The business has taken this
weak domestic situation as an opportunity to explore
tapping overseas markets, predominantly in South East
Asia and Middle East.
The year 2012-13 also saw extremely aggressive
competition with incumbents bidding low prices to bag
awards in the shrunk market. The business has initiated
aggressive cost saving measures to shield margins in an
enviornment of price pressures.
For 2013-14, a slight improvement is expected in the
market opportunities, with government tenders worth
9,000 MW on the anvil. Moreover, state electricity boards
are now leaning towards EPC ordering mode which is
positive for integrated EPC players like the Company’s
Power business.
Post the market downturn of 2011 and 2012, the second
half of fiscal 2013 witnessed Power business revive itself
with multiple order wins across business units. Two major
awards bagged during the year came from RRVUNL for
their 2x660 MW EPC project at Chhabra (Rajasthan) and
NPCIL for the Balance of Turbine Island job at their 2x700
MW Rawatbhata (Rajasthan) project.
On the execution front, the year saw critical milestones like
stator erection, hydro-test, turbine box-up being achieved
in some of the projects. The business also successfully
executed complicated multi-modal logistics plans for heavy
equipment across long distances and difficult terrain.
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The difficult interest rate regime for the better part of the
year meant that the business had to keep a rigid focus
on working capital management and ensure collection
of customer outstandings. Despite some slowdown by
lenders in disbursals to power sector, Power business could
manage to collect the dues from its customers and ended
the year with a healthy cash flow position.
Significant Initiatives :
The Power business introduced a slew of operational
initiatives during the year to counter the market
slowdown. The business also received critical recognition
for its capabilities across various competencies. The state-
of-the-art “Project Monitoring System” which allows
real-time single-touch monitoring of all project sites of the
business was recognized by NASSCOM which conferred
the NASSCOM INNOVATION 3.0 award on the business
for “best IT driven innovation in manufacturing vertical”.
The Quality Management Capability Center bagged the
prestigious “Golden Peacock National Quality Award”
for excellence in implementing quality initiatives and
improving business practices. Safety is one of the most
crucial factors that has upheld the execution excellence
reputation of the business. Bolstering this reputation,
Power business received the British Safety Council’s Sword
of Honour, which is the most coveted award in the area of
Health and Safety worldwide.
The Power Training Institute, set up at Vadodara last
year, to develop a pool of talented power professionals
conducted training programs across the gamut of
competencies during the year. Strong emphasis has been
placed on engineering and technology services to bring in
cutting-edge execution practices.
To insulate the business portfolio from the volatility of a
single market, Power business has taken steps to expand
operations beyond India. Since coal is not a permitted fuel
in several countries, the potential for coal projects overseas
is limited. Thus the focus is on opportunities for Gas
Based Power Plants in the countries where the business
is confident of being competitive as well as capable of
successful execution. The focus is on Middle East where
the business has set up two small power projects and
South East Asia. The business is pursuing active leads in
these regions and striving for a major breakthrough.
The Critical Piping unit which Manufactures High Pressure
Piping Spools for Thermal Power Plants is seeking
opportunities in Middle East. Steps have been taken to
build a business development team at Abu Dhabi.
The Joint Ventures with Mitsubishi Heavy Industries for
manufacture of Steam Turbines and Steam Generators
are seeking to supply components to MHI’s third country
projects.
Outlook :
While the year 2012-13 saw increased awareness and
acknowledgement of problems plaguing the power sector
with many announcements on reforms, it is important
for these announcements to translate into action on the
ground for the sector environment to improve. Government
promises on fuel supply agreements, fuel price pooling are
yet to fructify as also are the issues of standard bidding
documents (SBD) and fuel pass-through for imported coal
based plants. Though serious discussions are currently
underway between industry and the government, it is
likely that these deliberations will take 12 to 18 months
to yield results. Thus the year 2013-14 is likely to remain
subdued for the industry with continued pricing pressures
as domestic players chase the few available opportunities.
With the IPP market having dried up, opportunities for the
business during the year will come from PSUs like NTPC
and State Electricity Boards. For gas-based opportunities
in South East Asia and Middle East, we have made good
progress on prequalification and significant efforts have
been made to make a breakthrough in 2013-14.
Driven by its relentless focus on execution excellence,
Power business is well placed to capitalize on the thermal
power opportunities as they emerge and fortify its place
as a credible integrated power EPC player in India.
Major Subsidiary & Associate Companies :
L&T-MHI BOILERS PRIVATE LIMITED (LMB) :
Subsidiary Company :
LMB is a joint venture between L&T and Mitsubishi Heavy
Industries, Japan incorporated in India for the engineering,
design, manufacture, erection and commissioning of super
critical boilers in India. L&T has a 51% stake in the joint
venture. The manufacturing hub of LMB is at Hazira,
Gujarat while it has established design and engineering
centers at Faridabad & Chennai. The Company has total
installed capacity of 4000 MW for manufacture of boilers.
The Company is presently at an advanced stage of
executing its various orders and is confident of meeting the
market requirements with focused efforts to manufacture/
deliver the products to become more cost competitive
in the coming years. The Company is making efforts to
introduce advance ultra-supercritical Steam Generators
for the Indian market to remain ahead of competition
by providing energy efficient and environment friendly
products.
The export market thrust which is an integral part of the
company’s business strategy got impetus as the company
bagged a prestigious order from MHI to supply pressure
parts for Rabigh Arabian Water Electricity Company, Saudi
Arabia. Company is also trying to make inroads in the
Indian market for operational spares for pressure parts
and coal pulverisers.
L&T-MHI TURBINE GENERATORS PRIVATE LIMITED
(LMTG) :
Subsidiary Company :
LMTG is a joint venture between L&T and Mitsubishi Group,
Japan comprising of MHI and Mitsubishi Electric Corp.
(MELCO). The Company is engaged in the engineering,
design, manufacture, erection and commissioning of
super critical turbines and generators in India. L&T has
a 51% stake in the joint venture. The Company has a
state of the art manufacturing facility at Hazira, Gujarat
for manufacture of STG equipment of capacity ranging
from 500 MW to 1000MW.
During the past year, the competition has further
intensified with many international players setting up or
in the process of setting up manufacturing facility in India
and competing intensely for the few orders that are being
tendered. The aggressive pricing and delivery terms from
competitors has put severe pressure on the prices.
To face the twin challenges of weak business environment
and intense competition, the Company is focusing on Cost
competitiveness, better supply chain management, control
over working capital and efficient utilization of resources.
The Company is confident of meeting the market
requirements to manufacture & deliver cost competitive
products in the coming years.
L&T HOWDEN PRIVATE LIMITED (LTH) :
Subsidiary Company :
LTH is a joint venture between L&T and Howden Group,
UK. The Company was formed in 2010 with the objective
of supplying high end fans and air pre-heaters for super
critical power plants being set up in India. L&T has a stake
of 50.10% in the joint venture. The Company has a state
of the art manufacturing facility for manufacture of fans
and air preheaters at Hazira, Gujarat along with a Fan
Testing facility. It also has a design and engineering centre
at Faridabad near New Delhi.
During the past year, the Company won a major order for
supply of fans and air preheaters for one of NTPC Limited’s
super critical power plants under construction in South
India. The coming year holds a new set of challenges due
to subdued market apart from continued threat of import
of power equipment from Chinese manufacturers.
With several existing power plants in India being quite
old, the Aftermarket segment is expected to have a huge
potential which the Company is poised to exploit.
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L&T-SARGENT & LUNDY LIMITED (LTSL) :
Subsidiary Company :
LTSL is an equal joint venture between L&T and Sargent
& Lundy, USA. LTSL offers complete gamut of Power
Plant Engineering & Consultancy services-from concept
to commissioning. Its experience list includes overseas
projects in USA, Saudi Arabia, Oman, UAE, Jordan,
China, Thailand, Malaysia, Sri Lanka, Bangladesh, Nigeria,
Panama, Kuwait, Morocco and Kenya. Besides having
considerable expertise in gas based and sub-critical coal
based power projects, LTSL is also involved in engineering
of super-critical coal based projects and forms the
engineering base for L&T’s thrust into turnkey execution
of super-critical technology. As of now, it has engineered
around 19,000 MW of generation capacity of gas-turbine
based power plants and around 17,000 MW of generation
capacity of coal-based power plants across the globe.
LTSL’s prospects will be coming from L&T, S&L and Third
party domestic and international customers.
Though the domestic market does not seem encouraging,
the projects stalled for long are expected to be awarded
in this FY.
The international market provides opportunity to bid for
projects in the emerging nations. Apart from established
contacts in Middle East and S.Korea, LTSL intends to
build business relationships with clients located in other
identified countries such as Turkey, Brazil, South Africa,
Indonesia and Malaysia. LTSL will continue its thrust
on new areas of business viz. Project and Construction
management services at site, Transmission and Distribution
and Solar projects
Supercritical turbine being assembled at L&T’s Hazira Campus.
Supercritical boiler manufactured at L&T’s state-of-the-art manufacturing
facilities at Hazira.
Natural gas-fired combined cycle power plant built by L&T at Vemagiri in Andhra Pradesh, India
118
Heavy Engineering (HE) Business
World’s largest vacuum distillation column - weighing 975 MT - fabricated by L&T for Paradip refinery (Orissa, India).
Overview :
The Heavy Engineering (HE) business manufactures and
supplies custom designed, engineered critical equipment
& systems to core sector industries like Fertiliser, Refinery,
Petrochemical, Chemical, Oil & Gas, Thermal & Nuclear
Power, Aerospace and equipment & systems for Defence
applications.
HE business has manufacturing & fabrication facilities at
Mumbai in Maharashtra, at Vadodara & Hazira in Gujarat,
at Visakhapatnam in Andhra Pradesh and at Sohar in
Oman. At Talegaon in Maharashtra; it has a Strategic
Systems Complex for integration and testing of Weapons
Systems, Sensors & Engineering Systems. A Precision
Manufacturing Facility has been set up at Coimbatore
in Tamil Nadu to manufacture precision machined
components & assemblies. A Military Communications
and Avionics facility is set up at Bangalore in Karnataka.
This center is integrated with a development center and
small scale production facility for Defence Electronics and
Embedded software in these domains.
Project management teams at each location are
supported by detailed design and engineering centres.
Manufacturing teams are backed by production
engineering and manufacturing process development
centres at each location. The business has “Technology
and Product Development Centres” in Mumbai – for new
product development in process plant equipment and for
equipment & systems (including electronic systems/sub-
systems) for strategic sector. Strategic Submarine Design
Centre is also located in Mumbai.
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Reactors sail out from L&T’s manufacturing facility at Hazira for coal gasification plants in Vietnam.
Business Environment :
Despite the weak global economic scenario and pending
policy decisions on the domestic front the business booked
higher Order Inflow & Sales during 2012-13 with successes
in the overseas markets. Lack of level playing field due to
Free Trade Agreements signed by the Government of India
has increased competition in the domestic market.
The process plant equipment business faces aggressive
pricing, deliveries and payment terms offered by European,
Korean and Japanese fabricators. Localization policies of
certain countries and preference to local suppliers by certain
EPC companies due to socio-political conditions have also
impacted the HE business. The business’s competitiveness
is also influenced by the absence of competitively priced,
long tenor financing from Indian export credit agencies for
exported engineering products.
The defence business was impacted by delay in decision
making on ordering and long bid to award cycle. While
numerous new programs were initiated through the issue
of request of information (RFIs) and request for proposals
(RFPs), the procurement process has not picked pace given
the controversies in defence procurement and budget cuts
enforced in the last quarter of the financial year. Defence
offset opportunities have not fructified in significant value
terms due to delayed procurement and dilution in offset
related guidelines viz.; inclusion of homeland security &
civil aviation (as eligible for offset credits) and introduction
of multipliers for small & medium enterprises.
120
Significant Initiatives :
In the pursuit of manufacturing excellence and productivity,
the business is committed and continues to invest in its
campaign titled ‘UDAAN’ which signifies flight or breaking
free from existing mindsets to scale new heights. UDAAN
was initiated with the objective of achieving an exclusive
position in the global process plant equipment and to
fortify our lead position as supplier of defence equipment
& systems from the private sector.
Some of the initiatives under “UDAAN” are :
Implementation of Theory of Constraints
•
Lakshya
•
Enterprise-wide Collaboration for Alignment with
•
Strategy (ECAS)
Employee Engagement
Innovation
Sustainability
•
•
•
‘Theory of Constraints’ based ‘Critical Chain Project
Management’ targets improving execution and delivery
performance. The business undertook a mid-term review
of its ‘Lakshya’ – a five year strategic plan for identifying
strategies and action plans that are expected to drive
growth during the plan period.
ECAS seeks to enhance Organizational Excellence through
a strategy of promoting Customer Intimacy and promoting
a culture of Collaboration.
Employee engagement, feedback and ideation workshops
are conducted with the objective of creating an innovative,
involved and committed work force.
Technology & Product Development Centers are focused
on process technologies, manufacturing technologies,
mechanical systems technologies, defence electronics
technologies, embedded software solutions and submarine
designs. These centers provide specific emphasis on
welding & metallurgy, composite materials, heat transfer,
hydrodynamics, computational fluid dynamics, stress
analysis, microwave & RF technologies, embedded
systems, high availability systems, military communication
and drives technologies.
Outlook :
In the hydrocarbon sector, business prospects are
promising in the medium term to long term with expected
investments in greenfield, upgradation and revamp projects
in the USA, Middle East, CIS and South East Asian markets.
Increased shale gas availability in USA and Australia could
result in announcement of LNG and GTL projects. The new
urea investment policy is expected to incentivize domestic
investments in fertilizer plants. In the nuclear equipment
business, the civil nuclear liability implementation rules
have been tabled in Parliament but ambiguity in respect of
the extent of liability remains. For domestic nuclear power
plants procurement process for long lead items is expected
to commence.
The Ministry of Defence has announced a decision to give
impetus to indigenization as a thrust area. Under this new
policy Defence procurement programs are expected to
follow hierarchical categorization process by preference
to Buy (Indian), Buy & Make (Indian), Make categories
ahead of Buy & Make (Global) and Buy (Global) categories.
This would benefit the Indian industry with proven track
record over the medium to long term. The business is also
leveraging its product portfolio of multiple engineering
systems to tap overseas market opportunities in the
defence segment.
With superior technology, a lot of it home grown, state
of the art manufacturing facilities and a committed work
force, the HE business is well poised to tap upcoming
business opportunities.
Major Subsidiary Companies
L&T SPECIAL STEELS AND HEAVY FORGINGS PRIVATE
LIMITED (LTSHF) :
Subsidiary Company :
LTSHF is a joint venture (JV) between Larsen & Toubro (L&T)
and Nuclear Power Corporation of India Limited (NPCIL)
The photograph is for representation purposes only, and does not purport
The photograph is for representation purposes only, and does not purport
to be a photograph of the actual nuclear-powered submarine built by L&T.
to be a photograph of the actual nuclear-powered submarine built by L&T.
L&T made a critical contribution to India’s first nuclear-powered
submarine – INS Arihant. L&T offers a wide range of equipment and
systems for defence - army, navy and airforce
L&T will build the cryostat for the prestigious ITER alternative energy project
that will help meet growing global energy needs..
India’s PSLV C-19 takes off from SHAR, Sriharikota. L&T is closely associated
with programmes of the Indian Space Research Organisation (ISRO).
(Photo : Courtesy ISRO).
121
with L&T holding 74% equity stake. The JV Company has
set up a fully integrated manufacturing facility at Hazira to
produce ingots and finished forgings required for critical
equipment in nuclear power and hydrocarbon industry,
rotors in power industry, rolls in steel plants and other
heavy forgings for general engineering applications. The
JV is a major strategic step towards achieving India’s
independence from imports of heavy forgings and ensuring
timely supply of heavy forgings for nuclear power plants.
LTSHF commenced commercial operations from October
1, 2012 with a capacity to produce a single piece ingot
up to 300 MT and forgings up to 125 MT in the first
phase. During the year, the Company has successfully
made large size ingots and heavy forgings required for
critical equipment in refineries, fertilizers, nuclear and
other segments.
SPECTRUM INFOTECH PRIVATE LIMITED (SIPL) :
Subsidiary Company :
SIPL,a wholly owned subsidiary of L&T, possesses
capabilities in defence electronics and avionics systems.
SIPL concentrates largely on product development in
embedded solutions, control and signal processing for
defence sector and undertakes technology development
and manufacture of avionics LRUs for military applications.
SIPL is certified by Centre for Military Airworthiness and
Certification (CEMILAC) of the Ministry of Defence, India.
SIPL has obtained AS9100 Rev C, ISO 9001 and ISO 27001
certifications.
LARSEN & TOUBRO HEAVY ENGINEERING LLC:
Subsidiary Company :
Larsen & Toubro Heavy Engineering LLC is a Joint Venture
between Zubair Corporation and L&T, established in
Sultanate of Oman. L&T, through its wholly owned
subsidiary Larsen and Toubro International FZE, holds
70% in the Company. The heavy engineering facility
was commissioned in October 2009 and is based at
Sohar in Oman. The Company focuses on business in
the Middle East, mainly GCC countries and supplements
manufacturing and fabrication facilities located in India.
With more than USD 100 billion worth of investment
plans in oil, gas and petrochemical projects in the Middle
East and Oman planning to invest USD 50 billion in the
hydrocarbon sector in the next 10 years, the JV Company
sees good prospects in the region.
122
Electrical & Automation (E&A) Business
India’s widest range of switchgear, offered by L&T. Switchgear is part of L&T’s broad range of electrical and electronic systems, widely used in
industrial, agricultural, building and commercial sectors.
Overview :
Electrical & Automation (E&A) is one of the core businesses
of the Company. Its suite of offerings include low and
medium voltage Switchgear, Electrical Systems, Marine
Switchgear, Industrial and Building Automation Solutions,
Surveillance Systems,Energy Meters & Relays. Its products
and solutions cater to a variety of segments like industries,
utilities, infrastructure, buildings and agriculture.
A major strength of the E&A business is its in-house design
and development capability for its products and solutions.
It also has state of the art high precision tool manufacturing
facilities, a pre-requisite for high quality products. It runs
four Switchgear Training Centres (STCs) across India that
imparts training to engineers, consultants, technicians and
electricians.
The manufacturing facilities are located at Mumbai
(Powai), Navi Mumbai (Mahape & Rabale), Ahmednagar,
Vadodara, Coimbatore and Mysore in India as well as in
Saudi Arabia, UAE, Malaysia, Indonesia, Australia and the
UK.
The E&A business comprises two Strategic Business
Groups (SBGs) and designated subsidiaries. Further, there
are business units that operate under each SBG. The
Products SBG includes Electrical Standard Products (ESP)
and Metering & Protection System (MPS) while Projects
SBG has Electrical Systems & Equipment (ESE) and Control
& Automation (C&A).
123
Business Environment :
The E&A business witnessed sluggish economic conditions,
affected by factors such as tight liquidity, delayed policy
decisions and deferments in projects finalization, Rupee
weakening against US Dollar, volatility in commodity prices
and rise in input costs.
The E&A business, however, sees better business prospects
in Middle East evidenced by increase in enquiries/
order inflow. Business performance in sectors such as
solar, telecom, oil & gas and agriculture were better in
comparison to the traditional sectors like infrastructure,
power, utilities etc.
ESP focuses on Tier II/III cities/towns in India, in-line
with their growth strategy. The MPS business, that is
primarily restricted to institutional clients like state- owned
distribution companies, remained flat amidst fierce
competition. ESE continued its focus to strengthen its
position in Medium Voltage. C&A is putting continuous
efforts on adding higher value through own IP based
solutions and strengthening the delivery process.
Despite these odds, the E&A business registered a growth
in order inflow and revenue in the year 2012-13.
Significant Initiatives :
Not withstanding the economic slowdown, E&A was on
course to improving its performance in a variety of ways
that comprised restructuring business, acquisitions, new
capacity creation, launch of new products and numerous
process improvement initiatives.
E&A business set up common sales teams for Low &
Medium voltage and automation projects for identified
international territories broken into five clusters. During
FY 2012-13, E&A acquired UK-based Servowatch Limited,
one of the leading suppliers of advanced integrated ship
control systems for offering cutting edge technology
in control & automation space not only for marine
application but also for other emerging segments like
Security Surveillance System.
To expand and strengthen its scope of offerings, E&A
business acquired a leading Malaysia-based busduct
systems manufacturer, Henikwon Corporation in July
2012.
The year also saw new capacity creation for ramping up
production of MCCBs (Moulded Case Circuit Breaker) and
start of U-POWER ACB (Air Circuit Breaker) production by
opening a switchgear factory at Vadodara, for modular
devices at Ahmednagar and addition of new module
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for LV Switchgear at Coimbatore. The Vadodara facility
is supported by a well-equipped centre for research,
development and engineering of circuit breakers.
The E&A business also made history by implementing for
the first time in India Product Lifecycle Management (PLM)
7.01 version for CAD data integration with SAP to speed
up introduction of new projects.
Another major initiative taken during the year was
securing ISO 27001 certification for tightening Information
Security Systems for BU functions across all manufacturing
locations.
The Precision Machining Centre (PMC) of Engineered
Tooling Solutions was awarded the ‘Gold Certificate of
Merit-2012’ in India Manufacturing Excellence Award
(IMEA) instituted by Economic Times in association with
Frost & Sullivan. PMC was also certified for the tough
aerospace standards AS 9100 Rev. C and is well poised
to cater to global clients in aerospace markets. MPS
participated in the prestigious Indian Merchant Chambers
Ramakrishna Bajaj National Quality (IMC-RBNQ) Award
and got the commendation certificate in 2012 in the
manufacturing category.
Initiatives on spreading a culture of operational excellence
through ongoing improvement initiatives continued under
the banner of ‘ELITE’, an acronym for E&A’s Lean Initiative
Towards Excellence. These were Lean-5S, VSM (Value
Stream mapping), Value Engineering, Six Sigma, TPM-JH
(Total Productive Maintenance -JishuHozen) and PFMEA
(Process Failure Mode Effect Analysis).
As in the previous years, the E&A business was successful
in achieving significant savings on account of Value
Engineering (VE) and majority of the projects were focused
on reduction in material consumption.
Two initiatives, started recently-TPM for machines and
PFMEA for identifying potential defects in a process and
addressing them well before they surface-have started
yielding results.
MPS business unit embarked on technology up-grade for
integration of radio modules for facilitating collection of
data over mesh network and development of pre-paid
meter and smart meter.
A number of new products/variants were launched
during the year that comprised Mpower GSM Module
for controllers for the agriculture segment, Contactors,
premium range of Miniature Circuit Breakers (EXORA),
improved range of standard duty capacitors and new
protection relay (Mcomp). A solar lantern – Diva-was
launched by ESP BU, a cost effective solution for the power
deficit areas of the country and symbolizing the use of
clean energy.
registrations and 2 Copyrights as well as 10 international
Patent applications including 6 Patent Cooperation Treaty
(PCT) and 4 Gulf Cooperation Council (GCC) Patent
applications. This was the 6th consecutive year of filing
more than 100 patent applications.
The C&A business unit introduced new solutions for solar
plants. Its i-Visionmax solar package is a cost effective and
efficient tool that continuously controls and monitors the
plant thereby resulting in lower downtime and enhanced
improvement of the plant’s overall profitability.
E&A’s in-house R&D has design & development capabilities
for its products and solutions that are among the best
in the industry. The in-house R&D facilities located as
Powai–Mumbai ,Ahmednager, Mysore and Coimbatore
are approved by Department of Scientific & Industrial
Research, Ministry of Science & Technology.
The R&D centre networks with international labs, testing
centres and academic institutions to keep abreast of new
technology trends and introduce those for customers in
different segments. Focused R&D activities have enabled
ESP to have a healthy New Product Intensity (NPI) index
of >30%-an index which measures the sales of products
introduced in the market in last five years to the total sales
in the financial year.
During the year, the E&A business filed 159 Patent
applications, 29 Trademark applications, 36 Design
Continuous efforts on IP creation and its management
earned the E&A business the highest awards in patents
filing and design registration, instituted by the Indian
Patents Office, viz. ‘The Top Indian Private Company (Large
Scale) in Patents 2012’ and ‘The Top Indian Organisation
in Designs 2012’
Outlook :
It is expected that business sentiments in 2013-14 will
see an improvement over the current year and, therefore,
will offer better opportunities. The Government’s focus on
developing infrastructure sector holds promise and that
the industry could see investments and good growth.
There are indications of good growth in certain sectors and
the retail segment supported largely by Tier II/III cities and
towns in India. The country will witness higher growth in
energy efficient products as well as focus on development
of alternate energy sources would gain ground. Water is
another segment where investment is foreseen.
In projects business, EPC awards in major projects may
pick-up during FY 2013-14. Local content /value addition/
presence is fast becoming a crucial factor in GCC
Medium Voltage Switchboard Panels of Tamco, an L&T subsidiary.
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countries such as Oman and Qatar and also CIS (especially
Kazakhstan). Political uncertainty will still be a factor in
some countries.
The C&A BU is optimistic about the Terminal Automation
projects from oil refining companies which are coming
up in a phased manner – 60 locations in next 2 years.
The meter market is poised for healthy growth. MPS BU
expects large procurements expected from state utilities
like Rajasthan, West Bengal, Kerala, UP, Tamil Nadu and
Andhra Pradesh.
Major Subsidiary and Associate Companies :
TAMCO GROUP OF COMPANIES :
Subsidiary Companies :
TAMCO Group of companies operating from Malaysia,
Indonesia and Australia are the wholly owned subsidiaries
of Larsen & Toubro International FZE.
TAMCO is a leading medium voltage switchgear
manufacturer in South East Asia and exports more
than 50% of its produce to Middle East, Africa & UK.
Its products are widely used in power, oil & gas, mining,
heavy industries and construction. TAMCO spends more
than 3% of its revenue in R&D and has over the years
designed and developed the complete range of medium
voltage products in line with international standards.
TAMCO’s strength has been its quality and flexibility to
meet customers’ complex needs and has a significant
market share in Malaysia, Qatar, Dubai and Oman.
TAMCO is favourably placed. The approval by electricity
companies of UAE has opened good prospects for the
company and in the coming year, the company is hopeful
of getting good orders from them.
TAMCO’s new factory in Indonesia is a world class
manufacturing facility for Low and Medium Voltage
Switchgears. TAMCO Indonesia showed a significant
improvement in orders and revenue.
TAMCO group aims to continue making new product
developments in-line with “Lakshya 2016” Strategic plan.
The new products would facilitate in-roads in markets like
Kingdom of Saudi Arabia (KSA), United Kingdom (UK) in
the coming year. Besides this, TAMCO plans to build a new
manufacturing facility nearer to its customers. It is also
developing new OEM’s to expand its global reach.
L&T ELECTRICAL & AUTOMATION FZE (LTEAFZE) :
Subsidiary Company :
LTEAFZE, established in 2008 and operating from its own
Integration Centre, at Jebel Ali Free Zone in United Arab
Emirates (UAE), is a wholly owned subsidiary of Larsen &
Toubro International FZE.
The Company provides integrated control solutions to
industry verticals like Oil & Gas, Water & Waste Water,
Power and Infrastructure in the Middle East, Africa and CIS
markets with expertise in automation, telecommunication,
electrical & instrumentation segments.
Outside of Malaysia, there are excellent prospects in Qatar
due to FIFA 2022. There are large tenders for AIS (air
insulated switchgear) and RMU (ring main Unit)in which
With major customer approvals in place, this business is
focusing to provide solutions and services to Engineering
Procurement & Construction (EPC) companies and to end
Supervisory Control and Data Acquisition system - SCADA
A section of L&T’s range of electronic meters and relays.
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users for both new and brown field projects. The company
has further strengthened its position in infrastructure and
telecom segments and expects to grow in these areas
during the coming years.
L&T ELECTRICALS AND AUTOMATION SAUDI ARABIA
COMPANY LIMITED, LLC (LTEASA) :
Subsidiary Company :
LTEASA is a joint venture between L&T, India and Yusuf
Bin Ahmed Kanoo Group, KSA with a state-of-the-art
integrated manufacturing facility in Dammam, mainly
to cater to the customers in and around Saudi Arabia.
The Company offers complete range of electrical systems
and switchgear components in Low and Medium Voltage
categories, Pre-Fabricated/Packaged Substations, Variable
Frequency Drive panels and Automation systems etc.
The Kingdom of Saudi Arabia has increased it’s spend in
sectors like healthcare, education, housing, water and
transportation infrastructure. Major projects like Riyadh
Metro, King Abdulaziz International Airport etc., have
been tendered and are expected to be awarded during
2013-14. The Company expects to get the Saudi Electric
Company approval for its products during 2013-14,
thus paving the way for access to the huge SEC and
government/ministries market. All these developments
augur well for the company.
HENIKWON CORPORATION SDN BHD, MALAYSIA :
Subsidiary Company :
Established in 1982, Henikwon Corporation is a leading
manufacturer of Low Voltage (LV) & Medium Voltage (MV)
bus duct systems. Henikwon is globally well recognized
and its offerings include high quality products compliant
with international quality standards.
The Henikwon acquisition brought strong customer base
of large corporations to E&A’s business and complemented
its portfolio and has enabled offering of comprehensive
solutions for the building & infrastructure segments. It
further enhances our presence in South East Asia and in
catering to Indian and Middle East markets.
Henikwon products include wide range of LV & MV bus-
ducts with contemporary features & reliable quality that are
now part of L&T offerings in India. This is complemented
by Henikwon’s own brand equity and customer loyalty
in various other regions. Henikwon has a strong market
presence in most of the ASEAN countries.
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Machinery and Industrial Products (MIP) Business
L&T’s flow-control solutions for the hydrocarbon and power sectors are used worldwide. High-pressure valves for supercritical and nuclear power
plants are a vital part of its product portfolio.
Overview :
Machinery and Industrial Products (MIP) comprises
two Strategic Business Groups (SBGs) – Machinery and
Industrial Products.
Machinery SBG :
Machinery SBG consists of Construction & Mining
Machinery, Rubber Processing Machinery and Foundry
Business Units.
Construction and Mining Machinery Business Unit (CMB)
markets equipment manufactured by L&T-Komatsu Limited
and the entire range of Equipment available from Komatsu
worldwide. CMB also represents Scania, Sweden for their
Mining Tipper Trucks. CMB also provides product support
for all the equipment distributed by them. L&T-Komatsu
Limited manufacturers Hydraulic Excavators and Hydraulic
Components, all of which are distributed in India by CMB.
Rubber Processing Machinery Business Unit (RPM BU)
manufacturers and markets Rubber Processing Machinery
for the tyre industry. Currently, the Unit has manufacturing
facilities at Manapakkam, Chennai and Kancheepuram
near Chennai.
The Foundry Business Unit manufactures large sized
SG Iron and special Iron casting for Wind Power and
other Engineering sectors at its state-of-the-art Casting
Manufacturing Unit at Coimbatore that has an annual
capacity of 30,000T. The foundry can produce castings in
the weight range of 3T to 28T.
MIP has set up manufacturing facility for its Rubber
Processing Machinery business through the joint
venture, L&T Kobelco Machinery Private Limited, Karai,
Kancheepuram that manufactures Internal Mixers and
Twin Screw Roller Head Extruders.
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Industrial Products SBG :
Industrial Products (IP) SBG consists of businesses related
to industrial valves, welding equipment & products and
cutting tools.
Valves Business Unit (VBU) markets valves and allied
products manufactured by Audco India Limited and a few
Indian and Overseas manufacturers. VBU is one of the few
select suppliers of valves for global oil majors.
L&T’s Valves Manufacturing Unit (VMU) in Coimbatore is
responsible for manufacturing of Valves for Power Sector
and providing the technology support for new product
development of Valves.
L&T’s wholly owned subsidiary EWAC Alloys Limited (EWAC)
having its facility at Ankleshwar, Gujarat manufactures
and sells welding products. The principal products and
services comprise welding consumables for maintenance
and repair (M&R) segment, specification grade electrodes,
flux cored welding wires, wear plates, welding and cutting
equipment, tero cote lab services etc.
Industrial Cutting Tools (INP) business provides metal
cutting solutions to the Indian manufacturing industry
covering automobile, engineering and machine tools
segments through marketing of Industrial cutting tools
manufactured by ISCAR Limited, Israel.
Product Development Center (PDC) of MIP business
based at Coimbatore renders Engineering and Product
Development support across all the businesses of MIP.
Business Environment :
The Construction and Mining Machinery BU was affected
as Construction equipment industry shrank by 15% over
2011-12 largely on account of the lower demand from
road sector and general construction activities while
the Mining Equipment demand was affected by lack of
legislative action and pro-active legal impediments though
long-term prospects remain bright. In last few years
competition in Construction Equipment has increased with
existing manufacturers adding new capacity and entry of
new players who have also taken to aggressive pricing
eyeing market share. Consequently, pricing continued to
remain under pressure.
The year 2012-13 saw several Indian tyre majors postponing
investments due to sluggish automobile demand. However,
the Global tyre companies continued their investments in
India and in other emerging economies such as, South East
Asia, Brazil, Russia and China. RPM has been successful in
tapping some of these opportunities from the Global Tyre
companies and was able to double its order inflow from
overseas business.
The Foundry Business Unit (FBU) suffered a substantial
decline during the year 2012-13 and this coupled with
cheaper imports of castings from China resulted in
FBU being under great strain for most part of the year.
Expected re-introduction of Generation-based Incentive
and consolidation of market amongst key players will
enhance opportunity for FBU. WTG market is repositioning
itself with multi-megawatt Units (against fractional
mega-watt units) which require larger size castings. This
will ideally suit the FBU facility. The forecast appreciation
of Chinese currency (vis-à-vis INR) and the rising costs in
China are expected to help Indian suppliers to the WTG
industry becoming more competitive. Grid connectivity
and performance of State Electricity Boards continue to
impact WTG installations.
In the case of Industrial Products SBG, Industrial Valves
segment continued to face challenging environment. The
targeted projects in international oil & gas sector were on
schedule. The Domestic Power Projects have not taken off
due to various issues resulting in lower domestic orders
and this is reflected in the order inflows being stagnant
in the domestic segments. Project investments in North
America and Europe continue to be sluggish. Overall
project costs are coming down due to competitive bids
from EPCs in South Korea & China. This has caused all
major EPCs trying to put valve package proposals under
significant price pressures. In the Indian market, project
activity – including in de-bottlenecking projects-in
domestic oil & gas segment was low, resulting in lower
off-take from both Projects and Distributors. On power
sector, this has been a disappointing year with all major
projects hitting road blocks. In addition, due to delays
in payments, order execution was also delayed by many
customers resulting in lower sales. Expecting to cater to
the once promising Power Industry, many international
valve manufacturers have set up shop in India. With this
additional capacity among valve manufacturers in India
the intensity of competition is likely to increase in power
projects.
For Welding Product business, the year gone by has been
a difficult and challenging one in terms of the external
operating business environment. Poor investment climate
and high interest rates resulted in weak sentiments in
the Capital goods sector which had direct impact on our
equipment business. Tight liquidity conditions and low
economic activity affected sales of consumables. With
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continuing rise in prices of fuel, electricity and other input
costs coupled with additional cost of shifting of operations
during the year there was pressure on bottomline.
For INP business, overall, there was lower demand through
the year 2012-13 from key business segments led by the
automobile industry though there was increased buying
from government sectors such as railways and defence.
The rupee depreciation in forex market also affected
profitability, leading to higher cost of imports.
All the SBUs in the MIP business have faced challenging
business environment throughout the year.
Significant Initiatives :
CMB have expanded the company’s after-sales support
capability through long-term full-maintenance contracts
and site support agreements to improve machine uptime
and capping operating costs.
RPM took several initiatives in terms of product range
expansion and customer base expansion and service
offerings, significant among them is the development
of high-end radial Truck & Bus Tyre building machines
(first time in India), application of specialty coatings
on critical parts, PVD on special materials to enhance
life and functional improvements on the machines.
Introduction of new products helped the unit to manage
the downturn in the industry. Apart from newer sizes
of presses, the Company was also successful in getting
approvals of hydraulic press and Tyre building machines
from a few Global Tyre majors based in Europe and USA,
which is likely to open up opportunities in the Indian and
International market in the year 2013-14. RPM successfully
implemented Operational Excellence (OPEX) initiatives
in the area of Supply Chain Management resulting in
appreciable reductions in material cost as well as inventory
levels apart from creating capacities for critical processes.
A certification program in Tyre Machinery operation
and maintenance has been started at the facility in
Kancheepuram and has received good reviews from the
couple of batches that have attended the program. This
certification program is targeted towards engineering and
maintenance personnel in the Tyre Industry.
FBU established itself as the most preferred source to some
of its key customers. FBU was awarded TN Government’s
“GREEN AWARD” for environment friendly processes
amidst participation across industries. FBU continues to
maintain the standards and be a benchmark foundry in
terms of safety and environment management. FBU also
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has implemented successfully a number of initiatives
aimed at cost reduction during the year.
Valves Business Unit has expanded the approvals from key
oil companies and Power customers in the international
market. International network has been strengthened with
senior personnel posted in key markets such as the Middle
East and South Africa. A Global Valves Sales Head has now
been positioned in Jebel-Ali. Market coverage of domestic
channel business has been strengthened with a number of
Market development activities and product promotions.
Valves Business unit has been focusing on Oil & Gas in
the international market, both downstream and upstream
segments. Sustained oil & gas project activity in the Middle
East and Asia Pacific provided good opportunity for valves.
Long-term relationships with key end-users and EPCs in
these regions were leveraged to enhance our market
presence and exceed the order inflow targets for the
year. New products addressing the upstream and tankage
segments were well received in the international market.
During the year a beginning was made in the International
power segment with orders from major Power customers
for power projects across the globe.
INP business, over the last year successfully launched
many new products in drilling, milling and turning in the
market under ‘High IQ’ theme .These new introductions
are expected to enhance the competitive position and
build market share for the business.
Outlook :
The market demand for Hydraulic Excavators is expected
to improve on account of the increase in spending in
the urban infrastructure, roads, general construction
sectors and spending by the Government on various
infrastructure projects. Coal Sector will continue to be the
main demand driver for the Mining Equipment Business.
The projected Gap between domestic coal demand and
supply of around 200 million tonnes during FY 2013-14
portends opportunity subject to political actions leading
to investments. CMB is well placed to take advantage of
these opportunities through supply of large size Mining
Equipment both to the public and private coal producing
companies. Environmental & land acquisition issues
continue to be areas of concern and may cause near team
difficulties in mining equipment demands translating to
orders.
Escalating cost of conventional energy, continued
dependence on fuel imports and envisaged regulations
on commitment to proportional use of renewable energy,
makes it attractive for the growth of core segment – Wind
Turbine Generators. A 30% growth over FY 2012-13 in
terms of MW installation is expected in FY 2013-14. This
will help FBU position itself as the premium supplier to the
major WTG players.
Major oil and gas sector investments are planned in Middle
East, Australia and SE Asia. In India a large Petrochemical
project is being set up offering good business prospects.
NTPC’s expansion plans are on stream and offer a good
opportunity for our power Valves. Similarly the proposed
NPCIL expansion plans offer scope for specialty valves.
of 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. In the current year, EWAC completed
expansion of its facilities at Ankleshwar consolidating all
its manufacturing operations at one place.
The year gone by has been a challenging one in terms
of the external operating business environment. Poor
investment climate and high interest rates resulted in weak
sentiments in the capital goods sector which had direct
impact on equipment and consumables business.
For INP, the growth is expected to resume from second half
of 2013-14 due to anticipated recovery in automotive and
exports by key business segments and also better liquidity
coming from lower interest rates.
However, EWAC expects the situation to improve in
the year 2013-14 and has planned major initiatives for
addressing export markets and providing integrated
solutions to customers in welding and cutting spheres.
Overall, business outlook for 2013-14 continues to remain
challenging for most businesses of MIP and performance
improvement is expected with the turnaround in GDP,
impetus in Infrastructure investments and increased
government expenditure.
Major Subsidiary and Associate Companies
EWAC ALLOYS LIMITED (EWAC) :
Subsidiary Company :
EWAC is a market leader in the business of maintenance
& repairs welding & welding solutions for conservation
L&T KOBELCO MACHINERY PRIVATE LIMITED (LTKM) :
Subsidiary Company :
LTKM is a joint venture (JV) of Larsen & Toubro (L&T) and
Kobe Steel Ltd, Japan to manufacture Internal Mixers and
Twin Screw Roller-head Extruders for the tyre industry. This
venture has been successfully complementing the business
of L&T’s Rubber Processing Machinery Business Unit by
providing world-class Internal Mixers and Twin Screw
Extruders to the customers.
Hydraulic tyre-curing press – part of L&T’s wide range, manufactured and supplied to tyre manufacturers globally.
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During the year, LTKM had set up the state-of-the-art factory
at Karai Village, Kanchipuram to manufacture Internal
Mixers and Twin Screw Roller head Extruders for the tyre
industry and commenced its commercial operations. LTKM
also successfully completed the commercial production of
Extruders during the year and delivered to customer in
India and Italy/Russia.
L&T-KOMATSU LIMITED (LTK) :
Associate Company :
LTK is a JV between L&T and Komatsu Asia Pacific Pte.
Ltd., Singapore, a wholly owned subsidiary of Komatsu
Limited, Japan. L&T-Komatsu Limited has been engaged
in the manufacture of Hydraulic Excavators and other
associated hydraulic components, marketed by L&T. The
company was able to maintain its market share in its
addressable premium market segment, but saw its overall
share dropping due to shift in market demand towards
low-priced non-premium excavators.
AUDCO INDIA LIMITED (AIL) :
Subsidiary Company :
AIL is a 100% subsidiary of L&T. AIL is a leading
manufacturer of Industrial Valves. AIL manufactures various
types of valves such as Gate, Globe, Check, Trunnion
Mounted Ball, Butterfly, catering to all major industries
viz Refineries & Pipelines, Power, Offshore Platforms, Petro
Chemicals, Chemicals, Fertilizers, etc.
AIL Valves are approved by international Oil majors such
as Shell, Chevron, EXXON, Aramco, PDO, ADCO, KOC
which helps in participating in their worldwide projects.
AIL also has a unique advantage of Indian Nuclear Industry
approval. AIL products are distributed globally by L&T’s
Valves Business Unit.
L&T 9020 Wheel Loader-part of the wide range of machines for the
construction and mining sector
EWAC Alloys - a subsidiary of L&T - offers a wide range of welding
alloys and processes that extend machine life and help in the
conservation of resources.
Valve testing in progress.
L&T Komatsu PC 210 LC at work.
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Integrated Engineering Services (IES)
Knowledge City, Vadodara. The campus houses the global headquarters of Integrated Engineering Services.
Overview :
Integrated Engineering Services (IES) is today acknowledged
as one of the emerging leaders in the Indian Engineering
Research and Development (ER&D) service segment.
The Zinnov 2012 Global Service Provider Ranking,
(GSPR) has placed IES’s Industrial Products Domain in the
Leadership Zone for the second time in a row. This is a
true reflection of the commitment to be on the fast track
of being the “BEST” in engineering outsourcing service
industry.
IES is head-quartered at Vadodara, India with design
centers located in cities of Vadodara, Bengaluru, Chennai,
Mysore and Mumbai with global footprints and offices in
the US, Europe, Middle East and Asia Pacific.
IES’s service offerings include product design, analysis,
prototyping, testing, embedded system design,
manufacturing engineering, plant engineering &
construction management and asset information
management using cutting-edge Computer Aided
Design/Computer Aided Manufacturing/ Computer
Aided Engineering technology in various domains. IES has
supported innovation through co-authoring of over 70
patents.
IES also has alliances and partnerships with AUTOSAR
(Automotive Open System Architecture), National
Instruments, Intel, GENIVI and maintains high quality
and data security standards. IES was the first in the world
which received ISO/IEC 27001 : 2005 certification for IT
Security Management Systems. IES is an ISO 9001 : 2008
and a CMMI level 5 certified organization.
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Business Environment :
The year 2012-13 has seen outsourcing trends closely
tied to how the world economy has rapidly changed.
The financial uncertainty being created in some markets
drove corporates to reposition themselves through
new transformational initiatives. If the business climate
continues to suffer, companies will look to outsourcing
– particularly of non-core functions – as a means to save
costs.
On the other hand, if the economy improves and business
needs increase, outsourcing remains attractive because it
offers a way for companies to keep up with increased
demand and workflow. Regardless of the economic
outcome, market expects cost-cutting to remain a top
priority for global companies for the indefinite future.
As a result, engineering services industry will likely see
vendor-managed services on the rise, as companies see
the benefits and flexibility of using variable staffing
models. Large outsourcing providers would create business
opportunities in emerging economies, which may provide
more onshore outsourcing options.
Engineering Research & Development (ER&D) outsourcing
to India has shown remarkable growth from $8.3Bn in
2009 to $15 Bn in 2012. Based on the economic conditions
in Americas and Europe, analysts have revised growth
projections for 2013 to 10% from 16%.
Mega trends impacting the outsourcing industry are
convergence of Technologies/Industries :
•
Products and Solutions with multiple functionalities
are emerging especially in industries such as Consumer
Electronics, Medical Devices, Automotive and Mobile
Devices with cross-industry collaborations
• Open standards driven innovation
•
Electronics and software emerging as a key value
differentiator
• Adoption of cloud computing, big data, and software
driven infrastructure is opening new opportunities for
cost savings and innovation across many industries
including Telecom, Consumer, Healthcare, Utilities
and Manufacturing
Significant Initiatives :
IES has taken significant initiatives towards overcoming the
challenges posed by the market and to grow significantly
in comparison with its peers.
• Apart from expanding its global footprints, a key
initiative for IES is focusing on global account
management
Significant investments in the solutioning space with
emphasis on setting up Test Labs, Tear down studios
•
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•
•
and onboarding of solution architects & domain
experts to build new service offerings and industry
specific solutions that can be taken to the market
To foster an innovative culture and to ensure
inclusive growth, IES has invested in setting up of
the Technology Solutions and Innovation center
(TSIC). The Tech Panorama was an output of the TSIC
which was conducted across all of IES’ locations to
encourage employee participation and bring out the
creativity and innovation within the organization
To be best-in-class, IES has embarked on a
journey of bringing in operational efficiencies and
standardization and process consistency across the
organization. Significant investments have been made
in this space-the Project Management tool, CRM tool,
Productivity improvement & financial systems are
some of the initiatives that will be rolled out in the
new fiscal year
Majority of the revenue for IES is dependent on North
America and Europe regions. The market conditions
prevalent in these regions have high impact on the
business. To minimize this risk as well as to focus on newer
geographies, IES has increased its business focus on Rest
of the World (ROW) and Asia-Pacific (APAC) markets. IES
is also focusing on farming the current clientele and hiring
local talent to meet client expectations.
IES is actively working towards increasing its business share
through outcome based model from Resourcing-based
models. It is focusing more on Solution-based customer
engagement, which helps partner with a customer in his
NPD programs. The significant long term contracts won
during the year are a testimony to these endeavors.
Recruiting people of different skills, domains and experience
is a major challenge for the ER&D service industry. IES has
been able to minimize this to some extent by setting up a
Engineering talent is drawn from India’s premier academic institutes.
vertical oriented recruitment organization and by initiating
various training and capability development programs to
fulfill the ever changing customer needs.
Being a service provider to all major industry segments, the
projects executed by IES are varied in nature and require
different kinds of project management (PM) techniques.
In this regard, IES have initiated various training programs
in collaboration with L&T Institute of Project Management
and is also in the process of implementing“PULSE”-a
Project Management Tool to monitor and control project
performance parameters.
Outlook :
Global trends in the economy today motivate the people in
general to invest in businesses which have been growing
significantly over the years. Engineering Services is one
such industry. IES added 40 new clients during the year
and has been serving 35 fortune 500 companies. With the
initiatives taken in 2012-13, actions planned in the next
year and addition of new geographies, IES is confident of
achieving impressive growth in 2013-14.
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International revenue at
12198 crore doubled during the
year 2012-13 over that of the previous year. The international
revenue is mainly contributed by execution of airport, other
infrastructure development projects, Oil & Gas EPC contracts
in GCC countries and by growth in revenue of Integrated
Engineering Services.
Financial Review 2012-13
I. GROWTH AMIDST CHALLENGES
A. L&T STANDALONE
Braving challenging business conditions, the Company has
registered impressive increase in order inflow, growth in the
revenue and closed the year 2012-13 with strong order book
and healthy balance sheet.
The Company successfully secured new orders worth
88035 crore during the year 2012-13, registering a robust
growth of 24.7% over the previous year. The order intake
was notable against the backdrop of subdued investment
climate, lower GDP growth and delays in policy decisions
in India. Buildings and Factories, Power Transmission &
Distribution, Transportation Infrastructure and Power EPC
businesses contributed significantly to the order inflows
during the year. Despite global uncertainties and stiff
competition, the Company recorded a growth of 18% in the
international order inflow over 2011-12 aided by focused
efforts to develop the international markets for its offerings.
The Company relies on its good execution capabilities to
achieve revenue growth.
Operating Cost
Manufacturing, Construction and Operating expenses at
47952 crore for the year 2012-13 increased by 17%.
These expenses mainly comprise cost of construction &
other materials and subcontracting expenses. As compared
to the previous year, these costs have increased, reflecting
inflationary pressures and the mix of jobs under execution
during the year 2012-13.
The Order Book as at the year end stood at 153604 crore
providing revenue visibility for the next few years. 49%
of the order book represents orders received from the
infrastructure sector.
Revenue from Operations
Gross revenue for the year 2012-13 at 61471 crore grew
by 14.4% over the previous year. Certain businesses viz.
Buildings and Factories, Transportation Infrastructure, Water
and Solar projects registered good increase in the revenue on
the back of healthy order pipeline. The sales of the product
businesses, however, were impacted due to low industrial
demand.
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The Staff Expenses for the year 2012-13 at
4436 crore
increased by 21% as compared to the previous year. There
was a net addition of 5338 employees during the year,
taking the Company’s manpower strength to 54092 as at
March 31, 2013.
Sales and administration expenses for 2012-13 at
2077 crore decreased to 3.4% of net sales revenue due
to reversal of warranty/receivables provisions on successful
close out of jobs and recovery of dues.
Depreciation & Amortisation charge
Depreciation and amortisation charge for the year 2012-13
at
818 crore increased by 17% over the previous year.
Increase in the depreciation charge for the year reflects the
impact of the depreciation on the additions made to the
fixed assets.
Other Income
Other income for the year 2012-13 amounted to 1851 crore
as against
1338 crore for the previous year. It includes
profit of
219 crore on sale of certain surplus properties.
Dividends from Group companies during the year 2012-13
amounted to 585 crore. The short term investments made
in low risk securities yielded income at
575 crore for the
year.
The Company as a part of its portfolio management, divested
its stake in L&T Plastics Machinery Limited at an exceptional
gain of
214 crore. The Company paid compensation to
employees pursuant to Voluntary Retirement Scheme (VRS)
amounting to 38 crore. The exceptional gains, net of VRS
expenses and on post-tax basis, amounted to
144 crore
for the year 2012-13.
Finance cost
982 crore
The interest expenses for the year 2012-13 at
were higher vis-à-vis
666 crore for the previous year. The
increase is due to higher average borrowing incurred by the
Company for financing the capex/working capital needs and
investments in the Group companies. The loan portfolio of
the Company comprises a blend of domestic and suitably
hedged foreign currency loans. The average borrowing cost
for the year 2012-13 was at 8.8% p.a., despite the elevated
interest rate scenario and tight liquidity conditions.
Profit after tax and EPS
Besides exceptional gains (net of tax) of 144 crore earned
during the year, the Company also earned an extraordinary
gain (net of tax) of
72 crore. The said gain represents
reversal of provision made for the diminution in the value of
investment in Satyam Computer Services Limited and gain
of 19 crore on sale of Medical business.
over the previous year. Overall PAT including extraordinary
and exceptional items, for the year was 4911 crore vis-à-vis
4457 crore for the year 2011-12, recording an increase
of 10.2%.
The Earnings per Share (EPS) including exceptional and
extraordinary items, for the year 2012-13 at 79.99 showed
an improvement of 9.7% over the previous year.
Funds Employed and Returns
The overall Funds Employed by the Company at 38219 crore
as at March 31, 2013 increased by 2967 crore as compared
to the year end position as on March 31, 2012.
1505 crore towards capital
The Company incurred
expenditure during the year. The major expenditure was
incurred on acquisition of various plant and equipment for
the businesses in Engineering and Construction segment.
Gross Working capital as at March 31, 2013 was
43422 crore, representing 70.6% of sales vis-à-vis 72.9%
for the previous year. Net customer receivables as at the
end of the year stood at
22613 crore, which include
15532 crore of receivables contractually not yet due as on
March 31, 2013. The balance customer receivables which
were contractually due as on March 31, 2013 at 42 days’
sales have decreased by 1 day’s sales over the previous year.
Net Working capital as at March 31, 2013 at 10255 crore,
however, increased to 16.7% of sales due to relatively lower
advances from customers.
During the year, investments and loans to subsidiary and
associate companies increased by
1593 crore. Major
investments have been made in Power Development,
Shipbuilding, Machinery and Industrial Products and Realty
business.
Excluding extraordinary and exceptional items, the Profit
after Tax (PAT) at
4695 crore recorded a growth of 6.4%
Balance sheet lightening and divestment of non-core
businesses are among the key focus areas. During the year
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2012-13, the Company has carried out certain divestments
at remunerative prices with a view to free up the resources
to meet the increasing requirement of funds for core as
well as emerging businesses. Major divestitures during the
year 2012-13 comprise sale of Medical Equipment business,
divestment from Plastics Machinery business, sale of certain
surplus properties and exit from its investment in the Satyam
Computer Services Limited.
Return on Net Worth (RONW) including the gains on
divestitures for the year 2012-13 is at 17.3% as against
18.8% for the previous year. Return on Capital Employed
(ROCE) for the year 2012-13 is at 14.6% as against 15.1%
for the previous year. The relative reduction in the return on
net worth is attributable to the investments through Group
companies in the emerging businesses and expansion of
facilities that are yet to start yielding returns.
Economic Value Added (EVA) from normal operations
for the year 2012-13 is at
219 crore. Increase in funds
employed, contraction of margins and higher funding cost
have contributed to a reduction in the EVA for 2012-13 as
compared to the previous year.
Liquidity & Gearing
Tight liquidity position prevailed through the year 2012-13
increasing pressure on the funds employed. The Company
strived to achieve the balance between generation of funds
at economical rates and their deployment for meeting the
increasing business requirements.
Cash accruals from the operations were higher at
2115 crore as compared to the previous year mainly due
to tight working capital management. Proceeds from sale of
short term investments, divestitures, dividend and interest
income aided cash generation during the year 2012-13.
Apart from deployment of cash for capital expenditure and
investments in the Group companies, the Company repaid
some of its long term loans amounting to
2300 crore
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during the year 2012-13. Consequently, there was net cash
outflow of 411 crore for the year 2012-13.
Cash Flow Statement
Cash & bank balance at the start
of year
Cash generated by:
Operating activities
Other investing activities (Mainly
dividend and interest income)
Proceeds from sale of short term
investments
Divestment proceeds
Cash used by:
Capital expenditure
Investments in Group companies
Financing Activities (Mainly refund of
loans, interest & dividend payments)
Cash & bank balance at the end
of year
crore
2012-13
2011-12
1905
1730
2115
1728
1447
388
(1505)
(1593)
(2990)
1495
1082
1191
629
126
(1730)
(2139)
1016
1905
With a significant increase in Net Worth and reduction in
borrowings, the gross Debt Equity ratio improved to 0.30:1
as at March 31, 2013 from 0.39:1 as at March 31, 2012. Net
of investment in liquid funds, the Company has a low net
debt equity ratio of 0.07:1 as at March 31, 2013.
B. L&T GROUP PERFORMANCE
As at March 31, 2013, L&T Group consists of 139
subsidiaries, 14 associates and 14 joint venture companies.
Apart from extension of the Company’s core businesses in
the group companies, certain businesses such as Information
Technology, Financial Services and Developmental Projects
form part of the Group through investments in subsidiary
and associate (S&A) companies.
The Group Revenue at 75195 crore for the year 2012-13
registered a growth of 15.8% over the previous year. S&A
companies operating in Financial Services, Information
Technology, Hydrocarbon, Electrical & Electronics businesses
have registered a healthy growth during the year 2012-13.
The state of the art heavy forgings facilities at Hazira in
Gujarat, ship yard & port facilities in Kattupalli, Tamil Nadu
were successfully commissioned during the year 2012-13.
The construction work of major developmental projects viz.
Thermal Power Development plant at Rajpura in Punjab,
Seawoods project in Navi Mumbai, Hyderabad Metro Rail
project at Hyderabad progressed during the year.
The Group exited from two loss making ventures in China
and divested from certain real estate projects during the year
2012-13. The Group also divested its stake in Federal Bank
Limited during the year.
The Company has changed its accounting policy on goodwill
on consolidation for more appropriate presentation of
financial statements. As per the revised accounting policy,
the goodwill will not be amortised but the same will be tested
for impairment. Pursuant to the aforesaid policy change, the
consolidated PAT for 2012-13 is higher by 526 crore.
The overall Group Profit after tax at 5206 crore for 2012-13
registered a y-o-y increase of 10.9%. The Financial Services
and Infotech businesses contributed significantly to the
increase in the consolidated PAT.
The investments in the road concessions forming part of
developmental project business are incurring book losses,
as the newly commissioned projects are yet to reach the
optimum traffic levels. Moreover, the newly commissioned
forgings facilities, ship yard and port with lower initial
business volume but higher interest and depreciation
charge,have adversely impacted the PAT at the Group level.
The Earnings per Share (EPS) including exceptional and
extraordinary items for the year 2012-13 at 84.79 showed
an improvement of 10.4% over the previous year.
C. SEGMENT WISE PERFORMANCE
1. Engineering & Construction Segment (E&C)
1.1. L&T Standalone:
Order inflow of the segment during the year at
79766 crore registered a healthy growth of 25%
over the previous year. Orders were mainly procured by
Buildings & Factories, Transportation and Heavy Civil
Infrastructure, and Power businesses.
The segment revenue for the year at
54501 crore
grew by 15% over the previous year, mainly driven by
Buildings & Factories and Transportation Infrastructure
businesses. This revenue growth was achieved despite
of delays in obtaining clearances in a few projects under
execution. International sales revenue during 2012-13
at 10124 crore doubled as compared to 4826 crore
for 2011-12 propelled by execution progress on
Hydrocarbon, Airport and Infrastructure jobs.
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The composition of jobs under execution during
2012-13 was dominated by international jobs with
relatively lower margins. The slow progress on certain
jobs especially in the power, minerals & metals sectors
impacted margins. The segment recorded EBITDA
margin of 11.5% for 2012-13 vis-a-vis 12.7% earned
in the previous year.
1.2. L&T Group:
Group level order inflows in the E&C segment grew
by 20.4% to
83484 crore for the year ended
year driven by subsidiaries operating in Hydrocarbon,
Buildings & Factories and Infrastructure sectors. The
subsidiary companies operating in the Power, Power
distribution and Transmission businesses however
recorded decline in sales reflecting adverse business
environment and slow pace of execution.
The Group Segment recorded EBITDA Margin of 12.3%
during the year ended March 31, 2013 vis-à-vis 13.1%
in 2011-12.
2. Electrical & Electronics Segment (E&E)
2.1. L&T Standalone:
The segment revenue of E&E business stood at
3644 crore for 2012-13, recording a marginal increase
over the previous year. Intense competition and sluggish
market conditions posed considerable challenges for the
segment during the year.
March 31, 2013. The growth was driven by subsidiary
companies operating in the Heavy Engineering and
Infrastructure sectors.
At Group level, E&C segment recorded gross segment
revenue of
58616 crore for the year ended March
31, 2013 registering 13.8% growth over the previous
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The EBITDA margin for the year improved by 90 basis
points to 13.6% mainly contributed by Electrical
Standard Products and Electrical Systems and Equipment
businesses.
2.2. L&T Group
At Group level, E&E segment recorded gross
segment revenue of
4846 crore for the year ended
March 31, 2013 registering 12.6% growth over the
previous year.The revenue growth at the group level was
driven by the Tamco Group of subsidiary companies.
The Group Segment recorded EBITDA Margin of 16.5%
during the year ended March 31, 2013 vis-à-vis 13.3%
in 2011-12.
adversely impacted due to slow-down in manufacturing
and mining sectors in India and divestment of stake
from L&T Plastics Machinery Limited.
Amongst the group companies, EWAC Alloys Limited
registered a y-o-y increase of 9% in revenue at
400 crore.
3. Machinery & Industrial Products Segment (MIP)
3.1. L&T Standalone:
The Segment revenue declined in the year 2012-13
to
2395 crore due to sluggish industrial demand.
Revenue from International sales during 2012-13 at
533 crore, however, registered 21% growth over the
previous year.
The MIP Segment recorded an EBITDA Margin of 16.7%
during the year 2012-13 as against 18.3% during the
previous year.
4.
IT & Technology Services (IT&TS)
At Group level, IT&TS segment recorded segment
gross revenue of
4999 crore for the year ended
March 31, 2013 registering an impressive 25.7%
growth over the previous year. Most of its revenue is
from international customers.
The EBITDA margin of the segment declined during
2012-13 largely due to lower sales volume and
unfavorable sales mix.
3.2. L&T Group:
MIP Group segment recorded gross segment revenue
3374 crore
of
for 2011-12. At the Group level the performance was
2880 crore, lower as compared to
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Integrated Engineering Services business, a SBU at
L&T showed a robust growth of 43.6% in revenue for
1253 crore. Enhanced business volumes
2012-13 at
coupled with favourable foreign currency rates enabled
the segment to post growth in its revenue. In USD terms,
IES registered a healthy 24.9% growth in its revenue
over the previous year. There was a net addition of 1097
employees by IES during 2012-13.
L&T Infotech group recorded total income of 3862 crore
during the year ended March 31, 2013, registering
22% growth over the previous year. There was a net
addition of around 1270 employees by L&T Infotech
Group during 2012-13.
The segment recorded a healthy EBITDA margin of
25.1% during the year ended March 31, 2013 as
against 21% during the previous year.
6. Development Projects (DP)
Infrastructure
The Company has diversified
development business portfolio with a mix of projects
under development across various sectors such as
roads and bridges, ports and metro. The Company
owns 22 concessions in transportation infrastructure
development space under its fold out of which 18 are
roads and bridges, 3 are ports and 1 is a metro project
with total estimated project cost of
43711 crore. As
on March 31, 2013, 3 projects are under development,
6 projects are under construction while 13 projects
are completed and commissioned. In addition, the
Company has 5 power projects under development/
implementation, of which 1 is thermal power project
and 4 are hydel power projects with total estimated
project cost of 21934 crore.
DP Segment recorded gross segment revenue of
1406 crore for the year ended March 31, 2013,
5. Financial Services (FS)
FS Segment continued its growth momentum during
the year ended March 31, 2013 with an impressive
4080 crore. The
34.9% growth in its revenue at
segment recorded net interest margin of 5.44% as
against 5.51% in the previous year. The loan book of
the segment at
33310 crore as at March 31, 2013,
registered a healthy growth of 29.8% over the previous
year with increased focus on project and long maturity
term loans.
The FS segment disbursed fresh loans and advances
of
22995 crore during the year 2012-13, recording
moderate growth of 6.1% over the previous year. Net
Non-performing Assets (NPA) of the segment stood at
1.26% of loan assets as at March 31, 2013 as against
1.17% as on March 31, 2012.
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registered a growth of 26.2% over the previous year.
The segment recorded EBITDA of
979 crore for the
year 2012-13 vis-à-vis 536 crore for the corresponding
period of the previous year.
II. RISK MANAGEMENT
The Company’s primary activity of engineering and
construction business has a lot of uncertainty and associated
risks and opportunities. Enterprise Risk Management (ERM)
is an important function for sustainability of the Company’s
businesses. The ability to anticipate risks and respond
effectively is critical for achieving the Company’s objectives
and provide value to stakeholders. The slowdown in the
economy has impacted the overall business prospects. The
Company has been doing its part to improve the efficiency
by undertaking quality jobs, reducing costs, improving
productivity and managing the risks better.
Increased competition for available opportunities in domestic
markets has steered the Company to explore opportunities
globally with focus on markets in the Middle East, South-East
Asia, Africa and CIS countries. With this, the overall risk
universe of the organisation has expanded. Country risk
and client risk are the key risks to be evaluated in addition
to execution challenges, political and local issues, changing
regulatory laws, taxation and economic conditions of the
country. The commercial terms are important for managing
risks relating to the cash flow and performance liability.
All projects undergo a well-structured pre-bid risk review
process by risk management committee at business and
corporate level with well-defined authorisation levels.
The process involves a detailed assessment of risks and
deliberation on mitigation measures by the risk management
committee. In case of first time entry to a new country or
geography, a country clearance process is carried out by
evaluating the risks and opportunities. The Company strongly
believes in ensuring certainty of the project outcome and
follows a system of on-going projects risk review at regular
intervals. Suitable strategies are discussed to mitigate the
changing complexion of active risks and periodical execution
risk reviews continue till the completion of the project.
International large value projects are mainly characterised by
technological challenges, interface and logistics issues, claims
management, resource mobilisation and EHS compliance
amongst others. The large size of the project, execution
complexities, new technology, new geography at times
make it necessary to bid in consortium with one or more
partners on technology or construction front. The challenge
of selecting a suitable partner for seamless execution needs
due consideration on scope clarity, financial strength,
commercial arrangement regarding non-performance or
delay, revenue and profit sharing mechanism, liability
sharing, legal & dispute settlement.
On the domestic front, the Company is executing large power
projects in which apart from technological challenges and
tight delivery schedules, other important risk factors include
client creditworthiness, financial closure, fuel linkage, power
availability and environment clearances. Similarly, some of
the critical risk factors in infrastructure and construction
projects are land availability, various statutory and local
body approvals and redressal mechanism on default of client
obligations. The on-going slowdown witnessed over last
one year in domestic economy and the challenging liquidity
conditions, the Company has made suitable progress in the
area of improving the receivables management. The global
slump and unfavourable Government policies have impacted
the performance of a few subsidiaries operating in areas of
nuclear, forging and shipbuilding. The Company is actively
engaging with its subsidiaries to address these concerns.
While on one side the economic slowdown and severe
competition has put pressure on margins, the ERM strategy
of structured risk review process and the culture built over
the years has helped in effective management of all risks and
creation of value for the organisation.
The risk management process also addresses long term
strategic and operational planning, talent acquisition
and retention, treasury management, financial reporting
and controls, information technology and security,
environment health and safety compliance, legal, taxation,
communication, regulatory compliance and code of conduct
for employees. The Company believes that risk is an integral
part of every business and promotes a culture of building
ability to anticipate and manage the risks effectively and
converting them into opportunities.
The Company’s risk management practices ensure that the
Company accepts risks within defined parameters for which
it is adequately compensated and thereby managing the risk
portfolio of the organisation. The Audit Committee of the
Board oversees the effectiveness of the risk management
process. Every independent business segment has its risk
management policy and procedure within the overall ERM
framework of the Company. The process followed by the
Company is in compliance with the International Risk
Management Standard ISO 31000:2009. The Company
is also a member of the Engineering & Construction Risk
Institute (ECRI), USA and actively participates in training and
knowledge sharing.
Internal Controls
The Company believes that a strong internal control
mechanism is an important pillar of Corporate Governance.
It has established internal control mechanism commensurate
with the size and complexity of its business. Changing
business structure and increased focus on international
operations require continuous review of internal control
efficacy in all business segments of the Company
A corporate policy on internal control is in place which
provides structured framework for identification,rectification,
monitoring and reporting of internal control weaknesses in
the Company. The Company regularly issues accounting
guidelines to ensure uniformity and reliability of financial
statements and also has financial authorisation guidelines
covering purchasing, selling, authorising of expenses, etc.
which is followed throughout the Company. Individual
businesses of the Company have well documented standard
operating procedures (SOPs) for various processes which
they review from time to time for any changes required due
to change in business needs.
The Company has an internal audit department staffed
adequately with qualified professionals in both technical
and financial field. The department conducts audit of all
143
units of the Company and its major S&A companies at
regular intervals. Based on observations of internal audit
department, respective process owners carry out necessary
process/system improvements and thereby strengthen overall
control mechanism. All significant observations and corrective
actions taken are reviewed by the Management and Audit
Committee of the Board. There is also an internal control
department in the Company which helps in formulation of
internal control policy and guidelines for areas of weakness
identified during internal audit or by process owners or by
management.
Apart from the internal mechanism to review and monitor
internal controls, the Company also periodically engages
independent professional firms to carry out review of the
effectiveness of various control processes in businesses and
support functions. Their observations and suggestions on
good practices are reviewed by the Management and the
Audit Committee of the Board for implementation and
strengthening of the controls.
III. FINANCIAL RISKS
1. Capital Structure, Liquidity and Interest Rate Risks
The Company continues its policy of maintaining a
conservative capital structure which has ensured that
it retains the highest credit rating amidst an adverse
economic environment. Low gearing levels also equip
the Company with the ability to navigate business
stresses on one hand and raise growth capital on the
other. This policy also provides flexibility of fund-raising
options for future, which is especially important in times
of global economic volatility.
The Company holds necessary levels of liquidity,
judiciously deployed in short term investments in line
with the corporate treasury policy. The Company
constantly assesses liquidity levels in view of business,
economic and capital market conditions and maintains
access to the lowest cost means of sourcing liquidity
including banking lines, trade finance and capital
markets.
The Company dynamically manages interest rate risks
through a mix of fund-raising products, investment
products and derivative products across maturity
profiles and currencies within a robust risk management
framework.
2. Foreign Exchange and Commodity Price Risks
The various businesses of the Company are exposed to
fluctuations in foreign exchange rates and commodity
prices. Additionally, it has exposures to foreign currency
denominated financial assets and liabilities.
managed contractually by inclusion of price pass through
or variations clauses, the Company’s loan portfolio is
managed by an appropriate choice of loan currency
and also by contracting appropriate treasury products,
with a view to balancing risks and at the same time
optimising the borrowing costs. Hedging actions are
carried out under the framework of a Board approved
Risk Management Policy. Financial risks in each business
portfolio are measured and managed centrally within
the Company. These risks are reviewed periodically and
managed in line with the objective laid out in the Risk
Management Policy of the Company. The process is also
subject to an annual review by the Audit Committee.
IV. INFORMATION TECHNOLOGY
The Company views Information Technology (IT) as a key
enabler for efficiency and providing competitive advantage.
IT is accordingly managed through a robust governance
process that covers value delivery, cost optimisation,
technology management, support and education.
The Information Technology systems in the Company form
the backbone for carrying out all the business processes, for
communication, collaboration and for providing information
for effective decision making, monitoring and management
control.
The Information Systems at Company, implemented over
many years are maintained systematically to enhance
capability with new features and also to remain current on
technology with upgrades. These systems are improving
productivity and efficiency of all our operations. Over the
years, the newer systems help us to connect with customers,
provide better products and services and enable better
execution of large projects.
The Information Technology initiatives completed during the
year 2012-13 have been a healthy mix of introduction of
new technology, extending technology applications to new
areas and businesses and maintenance and enhancements
of existing systems.
Mobile technology has been implemented for a number
of applications. One of them was for the Company Board.
An Application on iPad now enables all board papers to be
made securely available on the iPads of all the directors with
features for directors to make annotations before and during
the meetings. The Board has thus become paperless and
the board members have access to the required information
while they are on the move thus increasing their efficiency.
The Secretarial Department’s efficiency has also been
increased because the processes of printing, compiling and
couriering the papers have been eliminated.
While the business related financial risks,especially
involving commodity prices are to a reasonable extent,
To improve efficiencies in procurement of material and services
and to enable access to new suppliers and new markets,
144
an advanced sourcing system has been implemented and
integrated with the ERP and is proving to be very beneficial.
A state of the art Project Management Center system has
been established that brings together project completion
information, a live visual status and communication with
project team all in a single instance to facilitate better
monitoring and review of projects by senior management.
On the manufacturing side, a Product Lifecycle Management
system has been implemented to facilitate new product
introduction and to tighten the integration between design,
procurement and manufacturing processes.
An innovation portal was launched to spur innovation,
tracking ideas from generation through the funnel to
fruition. Solutions for increased collaboration and knowledge
management are finding more traction with users. The
popularity of our eLearning solutions is increasing with more
users using the courses thereat.
While every business has been equipped with an ERP solution,
the year saw many enhancements, standardisations, roll outs
of the ERPs to overseas and new locations thereby enabling
seamless workflows between national and international
sites.
IT Infrastructure is being continuously enhanced and
improved with the commissioning of a new data center, new
computer and storage solutions, increased bandwidth, video
conferencing and telepresence systems for communications.
IT Risk Management is addressed holistically covering all
aspects of Information Security and Business Continuity
Planning. Many of the IT centers have been certified under
the ISO 27001 standard after due implementation of all the
processes.
V. CORPORATE SOCIAL RESPONSIBILITY
The sustainability journey of the Company has been rewarding
with recognition at the national as well as global levels. The
Company was ranked as the 4th Greenest Company in the
industrial segment in the World by Newsweek Magazine. The
Company has also been included in Dow-Jones Sustainability
Index – 2012 (emerging markets) and ranked as the sector
leader in construction & material section.
Social responsibility at the Company is born out of heightened
social consciousness. The Company and the individual
L&T-ite have always considered themselves as integral parts
of the larger social mosaic. The Company identifies growing
aspirations of communities, eagerly participates in the
collaborative quest for answers to society’s myriad problems
and ensures that its actions and operations do not impinge
on the collective good.
responsibility’ entered the public lexicon. The Company
disclosed environmental, social and economic performance
based on GRI framework in 2008, and since then have been
publishing the Sustainability Report on an annual basis.
A robust sustainability structure, commitment from top
management and innovation at the core gives strength to
sustainability reporting. All sustainability reports are ‘GRI
Checked Application Level A+’ signifying the highest levels
of disclosures.
After successful completion of first short term sustainability
targets (2009-12), the Company released its Sustainability
Roadmap for the period 2012-15. The roadmap emphasises
on energy conservation & GHG mitigation through innovation,
inducting a ‘safety culture’ and actively propagating the
concepts of water conservation, material management and
enhancing the health index of the organisation.
The Company believes that focused activities will lead to a
sustained impact. The Company has therefore enunciated
three distinct ‘Thrust Areas’. These are:
Mother & child
Education
Skill building
Company’s strategies are in harmony with National Action
Plan on Climate Change released by Government of India.
Some of the highlights from the Company’s sustainability
journey are carbon sequestration study at key campuses,
large scale tree plantation across manufacturing units and
project locations, increasing energy conservation by more
than 15% y-o-y and developing a talent pool of energy
auditors. L&T’s green product portfolio identified from
existing businesses helps customers to reduce their carbon
footprint during the operations and help them to move
towards low carbon growth economy.
Company’s water conservation initiatives are not only limited
to reducing water consumption at its manufacturing units
but also creating alternative water source to communities
by creating water bodies (check dams) in tribal areas. In
addition to 18 campuses which became ‘Zero wastewater
discharge units’, the Company’s Powai Campus at Mumbai
achieved water neutral status. L&T Public Charitable Trust
completed construction of the 100th check dam in the tribal
belt of Talasari in Thane district, Maharashtra.
The Company responds positively to emerging societal
expectations and helps to catalyse the harmonised growth of
society. Programs undertaken have grown in terms of reach
across Company’s locations and affirmative progress has
been made by strengthening the interventions in education,
health and skill building.
There has been no radical change in the way the Company
expresses the social concern after the concept of ‘mandated
Many seemingly complex social problems have down-to-
earth solutions - but these solutions need to be found, and
145
then implemented. The Company stepped in by augmenting
sanitation facilities in schools. It was the first step in a chain
reaction to improve education standards and reduce gender
disparity. More girl children have chosen to continue their
studies and education has received a boost.
The spread of Company’s community health care centers
was further widened with the addition of two new health
centers at Chennai and Coimbatore. Several health camps
and outreach programs were carried out in locations and
project sites across India in collaboration with local NGO’s
and hospitals, benefitting larger sections of society.
The skill building activities for rural and urban youth under
the Construction Skills Training Institutes covers 8 locations
and reach out to an increasing number of beneficiaries. The
model is being further scaled-up through partnerships with
ITI’s and NGO’s to extend training closer to rural population.
Other initiatives taken up include vocational training for
computer education, beautician and nursing assistant
courses. Training is also provided to empower self-help
groups of underprivileged women for income generation
opportunities.
Through Working on Wellness (WoW) initiatives, the
Company is working towards enhancing the employee
well-being by conducting programs such as power yoga,
stress management, health talks and preventive health care.
146
Independent Auditors’ Report
To the Members of Larsen & Toubro Limited
Report on the financial statements
We have audited the accompanying financial statements of Larsen & Toubro Limited (“the Company”), which comprise the balance sheet as at March
31, 2013, and the statement of profit and loss and the cash flow statement for the year then ended, and a summary of significant accounting policies
and other explanatory information.
Management’s responsibility for the financial statements
Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance
and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956
(“the Act”). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of
the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor’s responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards
on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected
depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud
or error. In making those risk assessments, the auditor considers internal control relevant to the Company’s preparation and fair presentation of the
financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of
the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required
by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:
(a)
(b)
(c)
Report on other legal and regulatory requirements
1.
in the case of the balance sheet, of the state of affairs of the Company as at March 31, 2013;
in the case of the statement of profit and loss, 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.
As required by the Companies (Auditor’s Report) Order, 2003 (“the Order”) issued by the central government of India in terms of sub-section (4A)
of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.
As required by section 227(3) of the Act, 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 purpose of our
2.
b.
c.
d.
e.
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, statement of profit and loss and cash flow statement dealt with by this Report are in agreement with the books of account;
in our opinion, the balance sheet, statement of profit and loss, and cash flow statement comply with the Accounting Standards referred to in
sub-section (3C) of section 211 of the Companies Act, 1956; and
on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the board of directors, none
of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section
274 of the Companies Act, 1956.
Mumbai, May 22, 2013
Annexure to the Auditors’ report
(Referred to in paragraph (1) of our report of even date)
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
1
The Company is maintaining proper records to show full particulars including quantitative details and situation of all fixed assets.
(a)
(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.
The Company has not disposed off any substantial part of its fixed assets so as to affect its going concern status.
(c)
147
2
3
4
5
6
7
8
9
(c)
(a)
(a)
(b)
(b)
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.
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.
The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not
material.
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.
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.
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 the purchase of inventory, fixed assets and for the 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.
According to the information and explanations given to us, we are of the opinion that there are no contracts or arrangements that need to be entered in the register
maintained under section 301 of the Companies Act, 1956; accordingly paragraph 4(v) (b) of the Order is not applicable.
The Company had 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 section 58A and 58AA and the relevant provisions of the Companies Act, 1956 and 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. As of the date of the balance sheet, the Company has no fixed deposits other than unclaimed matured deposits.
In our opinion, the Company has an internal audit system commensurate with its size and the nature of its business.
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 all its manufacturing and construction activities 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, 2013 for a period
of more than six months from the date they became payable except for tax deducted at source on works contract aggregating to 0.02 crore which has since
been paid.
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,
customs duty and income tax as at March 31, 2013 which have not been deposited on account of a dispute pending are as under:
(b)
Name of the statute Nature of the disputed dues
Amount
crore*
Period to which the amount relates
Forum where disputes
are pending
Commercial Tax Officer
Non-submission of forms and other matters
0.87 1991-92, 1992-93, 1996-97 to 2000-01, 2005-06 to
Non-submission of forms, dispute related to sales-in-transit,
rejection of exemption certificates, rate of tax dispute and
other matters
Non-submission of forms, additional demand for pending
forms, rate of tax dispute, disallowance of branch transfer,
sub-contractor’s turnover, interest demand on road permit,
disallowance of exemptions on sale of assets, transit sale
and other matters
Non-submission of forms, disallowance of transit sales, high
seas sales, classification dispute and other matters
Non-submission of forms and disallowance of exemption
certificates
Non-submission of forms, dispute related to sales-in-transit
and other matters
Non-submission of forms, labour and service charges, sub-
contractors turnover, pumping and freight charges, inter-
state sales turnover, arbitrary demand raised, TDS disallowed,
rate dispute, classification dispute, disallowance of works
contract tax and other matters
Inter-state sales, classification dispute and disallowance of
deemed sales in course of imports and taxability of sub-
contractors turnover
Taxability of sub-contractor turnover, rate of tax for declared
goods, inter-state sales, non-submission of forms and high
seas sales
2008-09
6.10 1991-92, 1992-93, 1996-97, 1997-98, 1999-00 to
2008-09, 2010-11 and 2011-12
Assistant Commissioner
(Appeals)
956.03 1989-90, 1991-92 to 2011-12
Deputy Commissioner
(Appeals)
143.19 1993-94, 1996-97, 1997-98, 2001-02 to 2009-10
Joint Commissioner
(Appeals)
12.81 2001-02, 2003-04 to 2008-09, 2010-11 and 2011-12 Additional Commissioner
0.99 1994-95, 2001-02, 2002-03 and 2005-06 to 2008-09 Commissioner (Appeals)
(Appeals)
290.62 1987-88, 1989-90 to 2011-12
Sales Tax Tribunal
298.38 1986-87, 1987-88, 1998-99 to 2011-12
High Court
197.89 1991-92, 1995-96, 1997-98 and 1999-00 to 2006-07 Supreme Court
Central Sales Tax Act,
Local Sales Tax Acts
and Works Contract
Tax Act
148
Name of the statute Nature of the disputed dues
The Central Excise
Act, 1944, Service Tax
under Finance Act,
1994 and Customs
Act, 1962
Demand of excise duty on steel price variation claims,
changes in assessable value due to reduction in billing
schedule quantity and demand on fabrication of tanks,
platforms and ladders
Interest on excise duty demand for duty paid on trading
registration in place of manufacturing registration and
demand for custom duty on software
Demand of excise duty on site fabricated steel structure,
export rebate disallowance, valuation dispute, excise duty
on concrete mix made at site, non-maintenance of proper
records, demand of service tax on various services and other
matters
Dispute on site mix concrete and PSC grinder
Demand of service tax on lumpsum turnkey jobs and other
matters
Demand of service tax including penalty and interest on
lumpsum turnkey jobs and demand of penalty on late
payment of service tax
Export rebate claim and service tax on commercial
construction service
Amount
crore*
Period to which the amount relates
0.86 1989-90 to 2011-12
Forum where disputes
are pending
Additional Commissioner
0.02 2006-07 and 2012-13
Commissioner (Appeals)
131.76 1991-92, 2001-02, 2003-04 to 2009-10, and 2011-12 CESTAT
0.27 1997-98
220.02 2003-04 to 2011-12
Supreme Court
Commissioner (Appeals)
151.59 1991-92, 2001-02, 2003-04 to 2009-10 and 2011-12 CESTAT
7.00 2003-04, 2006-07 to 2008-09
High Court
Income-tax Act, 1961 Dispute regarding tax not deducted on bank guarantee
2.20 2010-11 and 2011-12
Assessing Officer
charges, interest charges and purchase of software
Dispute regarding tax deducted at source at lower rate on
maintenance charges
Difference in rate of tax deducted at source
0.03 2005-06
2.23 2007-08 and 2008-09
Commissioner (Appeals)
Director of Income Tax
(International Taxation)
*Net of pre-deposit paid in getting the stay/appeal admitted
10
11
12
13
14
15
16
17
18
19
20
21
The Company has no accumulated losses as at March 31, 2013 and it has not incurred cash losses in the financial year ended on that date or in the immediately
preceding financial year.
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.
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.
The provisions of any special statute applicable to chit fund/nidhi/mutual benefit fund/societies are not applicable to the Company.
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
subsidiary companies 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.
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.
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.
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.
The Company has not raised any money by public issues during the year.
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 22, 2013
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
149
Balance Sheet as at March 31, 2013
EQUITY AND LIABILITIES:
Shareholders’ Funds
Share capital
Reserves and surplus
Non- current liabilities
Long term borrowings
Deferred tax liabilities (net)
Other long term liabilities
Long term provisions
Current liabilities
Short term borrowings
Current maturities of long term borrowings
Trade payables
Other current liabilities
Short term provisions
TOTAL
ASSETS:
Non current assets
Fixed Assets
Tangible assets
Intangible assets
Capital-work-in-progress
Intangible assets under development
Non current investments
Long term loans and advances
Cash and bank balances
Other non-current assets
Current assets
Current investments
Inventories
Trade receivables
Cash and bank balances
Short term loans and advances
Other current assets
TOTAL
CONTINGENT LIABILITIES
COMMITMENTS (Capital and others)
OTHER NOTES FORMING PART OF THE ACCOUNTS
SIGNIFICANT ACCOUNTING POLICIES
As at 31-3-2013
As at 31-3-2012
Note
crore
crore
crore
crore
A
B
123.08
29019.64
122.48
25100.54
29142.72
25223.02
7271.03
242.22
502.03
285.92
734.53
828.65
16730.65
14352.65
2083.81
8219.00
86.14
491.05
105.79
5580.69
2064.18
22613.01
1455.66
5498.84
11790.66
5330.06
133.01
376.35
275.05
8301.20
6114.47
2936.72
1628.99
15607.76
14009.40
2112.04
34730.29
72174.21
36294.91
67632.40
8901.98
10522.70
3664.17
39.02
43.30
8363.66
9084.71
4055.97
127.14
14.07
7528.00
76.98
697.53
61.15
6787.19
1776.62
18716.94
1778.12
5005.62
11922.36
49003.04
72174.21
45986.85
67632.40
C(I)
Q(13)
C(II)
C(III)
D(I)
D(II)
D(III)
D(IV)
D(V)
E(I)
E(II)
E(I)
E(II)
F
G(I)
G(II)
G(III)
H(I)
H(II)
H(III)
H(IV)
H(V)
H(VI)
I
J
Q
R
As per our report attached
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
Mumbai, May 22, 2013
150
A. M. NAIK
Group Executive Chairman
K. VENKATARAMANAN
Chief Executive Officer &
Managing Director
R. SHANKAR RAMAN
Chief Financial Officer &
Whole-time Director
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
A. K. JAIN
M. DAMODARAN
SUSHOBHAN SARKER
Directors
Mumbai, May 22, 2013
N. HARIHARAN
Company Secretary
Statement of Profit and Loss for the year ended March 31, 2013
2012-13
Note
crore
crore
2011-12
crore
crore
REVENUE:
Revenue from operations (gross)
Less: Excise duty
Revenue from operations (net)
Other income
Total revenue
EXPENSES:
Manufacturing, construction and operating expenses:
Cost of raw materials, components consumed
Construction materials consumed
Purchase of stock-in-trade
Stores, spares and tools consumed
Sub-contracting charges
Changes in inventories of finished goods, work-in-progress and
stock-in-trade
Other manufacturing, construction and operating expenses
Employee benefits expense
Sales, administration and other expenses
Finance costs
Depreciation, amortisation and obsolescence
Less: Transfer from revaluation reserve
Less: Overheads charged to fixed assets
Total expenses
Profit before exceptional and extraordinary items and tax
Exceptional items
Profit before extraordinary items and tax
Extraordinary items
Profit before tax
Tax expenses
Current tax
Deferred tax
Profit after tax carried to Balance Sheet
Basic earnings per equity share before extraordinary items ( )
Diluted earnings per equity share before extraordinary items ( )
Basic earnings per equity share after extraordinary items ( )
Diluted earnings per equity share after extraordinary items ( )
Face value per equity share ( )
OTHER NOTES FORMING PART OF ACCOUNTS
SIGNIFICANT ACCOUNTING POLICIES
}
K
L
M
N
O
P
Q(3)(a)
Q(3)(b)
Q(5)
Q(13)
Q(12)
Q
R
61470.86
597.60
53737.78
567.26
60873.26
1850.90
62724.16
53170.52
1338.28
54508.80
10892.29
14581.12
2063.23
2288.10
14472.06
(1132.03)
4787.63
819.42
0.95
1664.71
135.79
47952.40
4436.32
2091.08
982.40
818.47
56280.67
13.60
56267.07
6457.09
175.95
6633.04
78.11
6711.15
1800.50
4910.65
78.82
78.18
79.99
79.33
2.00
10092.12
12527.42
2369.40
1622.83
10747.27
(539.77)
4203.12
700.45
0.99
1814.13
39.70
41022.39
3666.09
2218.18
666.10
699.46
48272.22
18.75
48253.47
6255.33
55.00
6310.33
–
6310.33
1853.83
4456.50
72.92
72.23
72.92
72.23
2.00
As per our report attached
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
Mumbai, May 22, 2013
N. HARIHARAN
Company Secretary
A. M. NAIK
Group Executive Chairman
K. VENKATARAMANAN
Chief Executive Officer &
Managing Director
R. SHANKAR RAMAN
Chief Financial Officer &
Whole-time Director
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
A. K. JAIN
M. DAMODARAN
SUSHOBHAN SARKER
Directors
Mumbai, May 22, 2013
151
Cash Flow Statement for the year ended March 31, 2013
A. Cash flow from operating activities:
Profit before tax (excluding extraordinary and exceptional items)
Adjustments for:
Dividend received
Depreciation, amortisation and obsolescence
Exchange difference on items grouped under financing/investing activities
Expenditure on voluntary retirement scheme
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/(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 trade payables and customer advances
Cash (used in)/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 (including advance received)
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)
Deposits/Loans (given)/repaid (net)-subsidiaries, associates, joint venture companies and third parties (net)
Advance towards equity commitment (net)
Interest received
Dividend received from subsidiaries
Dividend received from other investments
Cash (used in)/from investing activities (before extraordinary items)
Extraordinary item
Cash received (net of expenses) on sale of Medical Business
Net cash (used in)/from investing activities (after extraordinary items)
Cash flow from financing activities:
Proceeds from fresh issue of share capital
Proceeds from long term borrowings
Repayment of long term borrowings
(Repayments)/Proceeds from other borrowings (net)
Dividends paid
Additional tax on dividend
Interest paid (including cash flows from interest rate swaps)
Net cash (used in)/from financing activities
B.
C.
Net (decrease)/increase in cash and cash equivalents (A + B + C)
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
2012-13
crore
6457.09
(589.66 )
818.47
347.89
(38.34 )
982.40
(532.69 )
(226.29 )
(248.92 )
85.41
(17.24 )
7038.12
(4118.15 )
(302.81 )
1365.37
3982.53
(1867.78 )
2114.75
(1505.14 )
313.10
(907.74 )
388.21
(35.99 )
218.26
1446.55
57.79
(743.00 )
590.87
583.21
6.45
412.57
52.36
464.93
163.14
3494.96
(2300.14 )
(2377.22 )
(1,012.79 )
(101.82 )
(856.39 )
(2990.26 )
(410.58 )
1905.26
1494.68
2011-12
crore
6255.33
(464.19 )
699.46
172.51
-
666.10
(568.94 )
(13.24 )
(122.64 )
156.73
(6.44 )
6774.68
(7300.21 )
(214.80 )
4007.28
3266.95
(2185.37 )
1081.58
(1729.50 )
132.36
(1753.23 )
126.40
–
17.94
629.03
512.58
(898.74 )
576.69
385.13
79.06
(1922.28 )
–
(1922.28 )
192.63
1979.70
(1543.10 )
1950.33
(886.19 )
(113.36 )
(564.40 )
1015.61
174.91
1730.35
1905.26
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.
Purchase of fixed assets includes movement of capital work-in-progress during the year.
2.
3. Cash and cash equivalents at the end of the year represent cash and bank balances and include unrealised loss of 1.68 crore (previous year : unrealised loss of 0.76
crore) on account of translation of foreign currency bank balances.
For cash and cash equivalents not available for immediate use as on the Balance Sheet date, see [Note G(II)(a)].
4.
5. Cash and cash equivalents are reflected in the Balance Sheet as follows:
(a) Cash and cash equivalents disclosed under current assets [Note H(IV)]
(b) Cash and cash equivalents disclosed under non-current assets [Note G(II)]
Total cash and cash equivalents as per Cash Flow Statement
6.
Previous year’s figures have been regrouped/reclassified wherever applicable.
2012-13
crore
1455.66
39.02
1494.68
2011-12
crore
1778.12
127.14
1905.26
A. M. NAIK
Group Executive Chairman
K. VENKATARAMANAN
Chief Executive Officer &
Managing Director
S. RAJGOPAL
N. MOHAN RAJ
M. DAMODARAN
R. SHANKAR RAMAN
Chief Financial Officer &
Whole-time Director
M. M. CHITALE
A. K. JAIN
SUSHOBHAN SARKER
N. HARIHARAN
Company Secretary
Directors
Mumbai, May 22, 2013
As per our report attached
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
Mumbai, May 22, 2013
152
Notes forming part of the Accounts
NOTE [A]
Share capital
A(I) Share capital authorised, issued, subscribed and paid up:
Particulars
Authorised:
Equity shares of 2 each
Issued, subscribed and fully paid up:
Equity shares of 2 each
As at 31-3-2013
As at 31-3-2012
Number of
shares
crore
Number of
shares
crore
1,62,50,00,000
325.00 1,62,50,00,000
325.00
61,53,85,981
123.08
61,23,98,899
122.48
A(II) Reconciliation of the number of equity shares and share capital:
Particulars
As at 31-3-2013
As at 31-3-2012
Number of
shares
crore
Number of
shares
crore
Issued, subscribed and fully paid up equity shares outstanding
at the beginning of the year
61,23,98,899
122.48
60,88,52,126
121.77
Add: Shares issued on exercise of employee stock options
during the year
29,87,082
0.60
35,46,773
0.71
Issued, subscribed and fully paid up equity shares outstanding
at the end of the year
61,53,85,981
123.08
61,23,98,899
122.48
A(III) Terms/rights attached to equity shares:
The Company has only one class of share capital, i.e. equity shares having face value of 2 per share. Each holder of equity share is
entitled to one vote per share.
A(IV) Shareholder holding more than 5% of equity shares as at the end of the year:
Name of the shareholder
Life Insurance Corporation of India
L&T Employees Welfare Foundation
Administrator of the Specified Undertaking of the
Unit Trust of India
As at 31-3-2013
As at 31-3-2012
Number of
shares
10,12,52,038
7,44,04,116
Shareholding
%
16.45
12.09
Number of
shares
11,04,05,734
7,44,04,116
Shareholding
%
18.03
12.15
5,06,17,308
8.23
5,05,72,216
8.26
A(V) Shares reserved for issue under options outstanding as at the end of the year on un-issued share capital:
Particulars
Employee stock options granted and outstanding #
3.5% 5 years & 1 day US$ denominated foreign currency
As at 31-3-2013
As at 31-3-2012
Number of
equity shares to
be issued as
fully paid
87,45,451 @
crore
(At face value)
Number of
equity shares to
be issued as
fully paid
1.75 * 1,14,28,854 @
crore
(At face value)
2.29 *
convertible bonds (FCCB) ##
49,07,243
0.98 ** 49,07,243
0.98 **
The equity shares will be issued at a premium of 491.96 crore (previous year: 640.32 crore)
*
** The equity shares will be issued at a premium of 935.42 crore (previous year: 935.42 crore) on the exercise of options by the
bond holders
#
Note A(VIII) for terms of employee stock option schemes
## Note C(I)(b) for terms of foreign currency convertible bonds
@
The number of options have been adjusted consequent to bonus issue wherever applicable
153
Notes forming part of the Accounts (contd.)
A(VI) The aggregate number of equity shares allotted as fully paid up by way of bonus shares in immediately preceding five years ended
March 31, 2013 are 29,25,92,054 (previous period of five years ended March 31, 2012: 29,25,92,054 shares)
A(VII) The aggregate number of equity shares issued pursuant to contract, without payment being received in cash in immediately preceding
five years ended March 31, 2013 – Nil (previous period of five years ended March 31, 2012: Nil)
A(VIII) Stock option schemes
a)
Terms:
i.
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 4 years [5 years in the case of series 2006(A)], subject to
the discretion of the management and fulfillment of certain conditions.
ii. Options can be exercised anytime within a period of 7 years from the date of grant and would be settled by way of equity.
Management has discretion to modify the exercise period.
b)
The details of the grants under the aforesaid schemes under various series are summarised below:
Sr.
No.
Series reference
1 Grant price -
2 Grant dates
3
Vesting commences on
4 Options granted and outstanding
at the beginning of the year
5 Options lapsed during the year
6 Options granted during the year
7 Options exercised during the year
8 Options granted and outstanding
2000
2002 (A)
2002 (B)
2003 (A)
2003(B)
2006
2006(A)
2012-13 2011-12 2012-13 2011-12 2012-13 2011-12 2012-13 2011-12 2012-13 2011-12 2012-13 2011-12 2012-13 2011-12
3.50
3.50
3.50
3.50
3.50
3.50
17.50
17.50
17.50
17.50
601.00
601.00
601.00
601.00
1-6-2000
1-6-2001
19-4-2002
19-4-2003
19-4-2002
23-5-2003 onwards
23-5-2003 onwards
1-9-2006 onwards
1-7-2007 onwards
19-4-2003
23-5-2004 onwards
23-5-2004 onwards
1-9-2007 onwards
1-7-2008 onwards
16800
16800
21500
21500
39700
39700
31452
31452 647302
932880 2026751 3974443 8645349 8936534
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
62150
56711
42513
89849 781908
817452
118000
118400
–
– 1072250 1867930
267950
347267 1072770 1857843 1646362 1341663
at the end of the year
16800
16800
21500
21500
39700
39700
31452
31452 435202
647302 911468 2026751 7289329 8645349
of which –
Options vested
16800
16800
21500
21500
39700
39700
31452
31452 109802
104202 911468 2011951 2135578 1751546
Options yet to vest
–
–
–
–
–
–
–
–
325400
543100
-
14800 5153751 6893803
9 Weighted average remaining
contractual life of options (in
years)
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
5.12
4.87
1.51
1.51
4.39
4.85
c)
The number and weighted average exercise price of stock options for the following group of options are as follows:
Particulars
(i) Options granted and outstanding at the beginning of the year
(ii) Options granted during the year
(iii) Options allotted during the year
(iv) Options lapsed during the year
(v) Options granted and outstanding at the end of the year
(vi) Options exercisable at the end of the period out of (v)
2012-13
2011-12
No. of stock
options
1,14,28,854
11,90,250
29,87,082
8,86,571
87,45,451
Weighted
average
exercise price
( )
562.27
543.15
548.66
560.10
564.54
No. of stock
options
1,39,53,309
19,86,330
35,46,773
9,64,012
1,14,28,854
Weighted
average
exercise price
( )
557.33
566.22
543.87
566.67
562.27
supra
32,66,300
561.50
39,77,151
569.38
154
Notes forming part of the Accounts (contd.)
d) Weighted average share price at the date of exercise for stock options exercised during the period is 1452.14 (previous year:
1540.11) per share.
e)
(i)
In respect of stock options granted pursuant to the Company’s 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 over the vesting period.
(ii) Expense on Employee Stock Option Schemes debited to the Statement of Profit and Loss during 2012-13 is 85.41 crore
(previous year: 156.73 crore) net of recoveries of
6.18 crore (previous year: 10.52 crore) from its group companies
towards the stock options granted to deputed employees, pursuant to the employee stock option schemes. (Note N). The
entire amount pertains to equity-settled employee share-based payment plans.
f) During the year, the Company has recovered 12.44 crore (previous year: 31.51 crore) from its subsidiary companies towards
the stock options granted to their employees, pursuant to the employee stock option schemes.
g) Had fair value method been adopted for expensing the compensation arising from employee share-based payment plans:
a.
The employee compensation charge debited to the Statement of Profit and Loss for the year 2012-13 would have been
higher by 29.85 crore (previous year: 25.99 crore) [excluding 2.30 crore (previous year: 4.79 crore) on account of
grants to employees of subsidiary companies]
b. Basic EPS before extraordinary items would have decreased from 78.82 per share to 78.33 per share
c.
Basic EPS after extraordinary items would have decreased from 79.99 per share to 79.50 per share
d. Diluted EPS before extraordinary items would have decreased from 78.18 per share to 77.70 per share
e. Diluted EPS after extraordinary items would have decreased from 79.33 per share to 78.85 per share
h) Weighted average fair values of options granted during the year is 909.35 (previous year: 745.94) per option
i)
The fair value has been calculated using the Black-Scholes Option Pricing Model and the significant assumptions and inputs to
estimate the fair value of options granted during the year are as follows:
Sr.
no.
Particulars
(i) Weighted average risk-free interest rate
(ii) Weighted average expected life of options
(iii) Weighted average expected volatility
2012-13
2011-12
8.05%
4.26 years
39.38%
8.28%
4.33 years
41.09%
(iv) Weighted average expected dividends over the life of the option
70.24 per option
62.84 per option
(v) Weighted average share price
1317.81 per option
1146.53 per option
(vi) Weighted average exercise price
543.15 per share
566.22 per share
(vii) Method used to determine expected volatility
Expected volatility is based on the historical
volatility of the Company’s share price applicable
to the total expected life of each option.
j)
The balance in share option outstanding account as on March 31, 2013 is 393.96 crore (net) (previous year: 431.94 crore),
including 154.32 crore (previous year: 134.00 crore) for which the options have been vested to employees as on March 31,
2013.
A(IX) The Directors recommend payment of final dividend of 18.50 per equity share of 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 61,53,85,981 equity shares outstanding
as at March 31, 2013 amounting to 1138.47 crore.
155
Notes forming part of the Accounts (contd.)
NOTE [B]
Reserves and surplus
Particulars
Capital reserve
Securities premium account: [Note Q(5)(b)]
As per last Balance Sheet
Addition during the year
Less: Share/bond issue expenses (net of tax)
Reversal of recoveries credited in previous years
Debenture redemption reserve:
As per last Balance Sheet
Add: Transferred from Surplus Statement of Profit and Loss
Less: Transferred to general reserve
Revaluation reserve:
As per last Balance Sheet
Less: Transferred to Statement of Profit and Loss
Share options outstanding account:
Employee stock options outstanding:
As per last Balance Sheet
Addition during the year
Deduction during the year
Deferred employee compensation expense:
As per last Balance Sheet
Addition during the year
Deduction during the year
Hedging reserve (net of tax): [Note Q(13)]
As per last Balance Sheet
Addition/(deduction) during the year (net)
General reserve:
As at 31-3-2013
As at 31-3-2012
crore
7206.35
309.05
7515.40
0.57
2.72
118.01
50.25
–
21.14
0.95
709.00
92.20
215.31
(277.06)
(92.20)
177.33
(301.53)
(31.34)
crore
10.52
crore
crore
10.52
6879.37
327.31
7206.68
0.33
–
7512.11
7206.35
136.51
44.00
62.50
168.26
118.01
22.13
0.99
20.19
21.14
805.82
115.27
212.09
585.89
709.00
(437.51)
(115.27)
275.72
(191.93)
(277.06)
52.75
(354.28)
(332.87)
(301.53)
As per last Balance Sheet
Add: Transferred from Surplus Statement of Profit and Loss
Add: Transferred from debenture redemption reserve
17461.72
3500.00
–
14149.22
3250.00
62.50
Carried forward
156
20961.72
28733.89
17461.72
24948.15
Notes forming part of the Accounts (contd.)
NOTE [B]
Reserves and surplus (contd.)
Particulars
Brought forward
Surplus Statement of Profit and Loss
As per last Balance Sheet
Profit for the year
Less: Dividends paid for previous year
Additional tax on dividend paid for previous year
Transfer to general reserve
Transfer to debenture redemption reserve
Proposed dividend [Note A (IX)]
Additional tax on dividend
As at 31-3-2013
As at 31-3-2012
crore
crore
28733.89
crore
crore
24948.15
152.39
4910.65
5063.04
2.33
0.38
3500.00
50.25
1138.47
85.86
4777.29
105.68
4456.50
4562.18
3.35
0.54
3250.00
44.00
1010.46
101.44
4409.79
152.39
25100.54
285.75
29019.64
NOTE [C(I)]
Long term borrowings
Particulars
Note
Secured Unsecured
Total *
Secured Unsecured
Total *
As at 31-3-2013
As at 31-3-2012
Redeemable non-convertible fixed rate debentures
3.50% Foreign currency convertible bonds
Term loans from banks
Sales tax deferment loan
Long term maturities of finance lease obligations
[Note Q(11)(ii)(b)]
C(I)(a)
C(I)(b)
C(I)(c)
C(I)(d)
C(I)(e)
crore
900.00
–
–
–
crore
1050.00
1085.70
4227.08
8.25
crore
1950.00
1085.70
4227.08
8.25
crore
900.00
–
–
–
crore
800.00
1017.50
2557.85
15.54
crore
1700.00
1017.50
2557.85
15.54
–
–
–
–
39.17
39.17
900.00
6371.03
7271.03
900.00
4430.06
5330.06
*Loans guaranteed by directors Nil (previous year: Nil)
C(I)(a)
i)
Secured redeemable non-convertible fixed rate debentures (privately placed):
Date of
allotment
31-3-2013
crore
31-3-2012
crore
Interest for the
year 2012-13
Terms of repayment for debentures
outstanding as on 31-3-2013
Face
value per
debenture ( )
10,00,000
Sr.
no.
1
2
January 5,
2009
400
400
9.15% p.a.
payable annually
10,00,000
December 5,
2008
500
500
11.45% p.a.
payable annually
Redeemable at face value at the
end of 10th year from the date of
allotment.
Redeemable at face value 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.
Total
900
900
Security: The debentures are secured by way of a first charge having pari passu rights on the immovable property at certain
locations and part of a movable property of a business division, both present and future.
157
Notes forming part of the Accounts (contd.)
C(I)(a) (contd.)
ii) Unsecured redeemable non-convertible fixed rate debentures (privately placed):
Sr.
no.
Face value per
debenture ( )
Date of
allotment
31-3-2013
crore
31-3-2012
crore
Interest for the
year 2012-13
1
2
3
4
10,00,000
10,00,000
10,00,000
10,00,000
April 10,
2012
May 26,
2010
May 11,
2010
April 13,
2010
250
300
300
200
–
9.75% p.a.
payable annually
300
8.95% p.a.
payable annually
300
9.15% p.a.
payable annually
200
8.80% p.a.
payable annually
Terms of repayment for
debentures outstanding as on
31-3-2013
Redeemable at face value at the
end of 10th year from the date
of allotment.
Redeemable at face value at the
end of 10th year from the date
of allotment.
Redeemable at face value at the
end of 10th year from the date
of allotment.
Redeemable at face value at the
end of 10th year from the date
of allotment.
C(I)(b)
Foreign Currency Convertible Bonds:
Total
1050
800
3.50% US$ denominated 5 years & 1 day Foreign Currency Convertible Bonds (FCCB) carried at 1085.70 crore as on March
31, 2013 ( 1017.50 crore as on March 31, 2012) represent 2000 bonds of US$ 1,00,000 each .The bonds are convertible
into the Company’s fully paid equity shares of 2 each at a conversion price of 1908.20 per share at the option of the bond
holders at any time on and after December 1, 2009 up to October 15, 2014.The bonds are redeemable, subject to fulfillment
of certain conditions, in whole but not in part, at the option of the Company, on or at any time after October 21, 2012 but
not less than seven business days prior to the maturity date, at the principal amount together with accrued interest (calculated
upto but excluding the date of redemption) on the date fixed for redemption, unless the bonds have been previously redeemed,
converted or purchased and cancelled.
C(I)(c)
Term loans (unsecured): External Commercial Borrowings (ECBs)
31-3-2012
crore
Rate of interest
Terms of repayment of term loan outstanding as on 31-3-2013
Sr.
no.
1
31-3-2013
crore
1085.70
542.85
108.57
542.85
– USD LIBOR + Spread
– USD LIBOR + Spread
– USD LIBOR + Spread
– USD LIBOR + Spread
352.01
129.25 JPY LIBOR + Spread
323.01
247.85 JPY LIBOR + Spread
255.11
274.05 JPY LIBOR + Spread
858.65
168.04
190.00
922.40 JPY LIBOR + Spread
180.52 JPY LIBOR + Spread
178.06 USD LIBOR + Spread
Repayable in 5 equal quarterly installments commencing from
January 17, 2019 and ending on January 17, 2020
Repayment due on January 01, 2018
Repayment due on September 27, 2017
Repayable in 3 equal annual installments on September 02, 2016,
September 05, 2017 and September 04, 2018
Repayable in 3 equal annual installments on April 25, 2016, April
24, 2017 and April 24, 2018
Repayable in 3 equal annual installments commencing from March
12, 2016 and ending on March 12, 2018
Repayable in 4 equal annual installments commencing from
December 24, 2015 and ending on December 24, 2018
Repayment due on July 26, 2014
Repayment due on November 21, 2013
Repayable in 6 equal installments payable annually from September
18, 2013 to September 18, 2017 with the final installment due on
June 18, 2018
Repayment due on April 15, 2013
625.73 JPY LIBOR + Spread
486.06 JPY LIBOR + Spread
112.09 JPY LIBOR + Spread
101.75 USD LIBOR + Spread
872.77 JPY LIBOR + Spread
582.48
–
–
–
–
5009.27
782.19
4227.08
4130.53
1572.68 Current portion of long term borrowings [Note D(II)]
2557.85 Long term borrowings as disclosed in Note C(I)
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Less:
158
Notes forming part of the Accounts (contd.)
C(I)(d)
Sales tax deferment loan (Unsecured):
Sr.
No.
As at 31-3-2013
crore
As at 31-3-2012
crore
Rate of
Interest
Terms of repayment as on March 31, 2013
1
2
3
4
5
6
7
8
Total
Less:
0.39
0.60
0.58
0.31
0.15
0.05
13.46
–
15.54
7.29
8.25
Repayable in 5 equal annual installment of 0.08 crore ending
April 26, 2018
Repayable in 5 equal annual installment of 0.12 crore ending
April 26, 2017
Repayable in 4 equal annual installment of 0.14 crore ending
April 26, 2016
Interest Free
Repayable in 3 equal annual installment of 0.10 crore ending
April 26, 2015
Repayable in 2 equal annual installment of 0.07 crore ending
April 26, 2014
Repayable on April 26, 2013
Repayable on April 1, 2013 : 6.80 crore, Repayable on April 1,
2014: 6.66 crore
0.39
0.60
0.72
0.42
0.22
0.10
20.26
15.73
38.44
22.90 Current portion of long term borrowings [Note D(II)]
15.54 Long term borrowings as disclosed in [Note C(I)]
C(I)(e)
Long term maturities of finance lease obligations:
Sr.
No.
As at 31-3-2013
crore
As at 31-3-2012
crore
Rate of
interest for
the year
2012-13
Terms of repayment as on March 31, 2013
1
Total
Less:
39.17
39.17
39.17
Nil
72.58
16.02 % Repayable in equal monthly installments by March 2014
72.58
33.41 Current portion of long term borrowings [Note D(II)]
39.17 Long term borrowings as disclosed in [Note C(I)]
NOTE [C(II)]
Other long term liabilities
Forward contract payable
Others
Particulars
As at 31-3-2013
As at 31-3-2012
crore
485.44
16.59
502.03
crore
347.24
29.11
376.35
159
Notes forming part of the Accounts (contd.)
NOTE [C(III)]
Long term provisions
Particulars
As at 31-3-2013
As at 31-3-2012
Provision for employee benefits
Employee pension scheme [Note Q(8)(ii)(a)]
Post-retirement medical benefits plan [Note Q(8)(ii)(a)]
Interest rate guarantee-provident fund [Note Q(8)(ii)(a)]
NOTE [D(I)]
Short term borrowings
crore
186.38
99.54
–
285.92
crore
174.19
82.18
18.68
275.05
Particulars
Secured Unsecured
Total*
Secured Unsecured
Total*
crore
crore
crore
crore
crore
crore
As at 31-3-2013
As at 31-3-2012
Loans repayable on demand from banks
[Note D(I)(a)], [Note H(IV)(a)]
Short term loans and advances from banks [Note D(I)(a)(b)]
Intercorporate borrowings :
209.26
124.75
8.94
218.20
132.58
8.94
141.52
391.58
516.33
420.76
2041.44
2462.20
Loans from related parties (subsidiary companies)
–
–
–
–
333.00
333.00
334.01
400.52
734.53
553.34
2383.38
2936.72
* Loans guaranteed by directors Nil (previous year: Nil)
D(I) (a) Loans repayable on demand from banks include fund based working capital facilities viz. cash credits and demand loans. The
secured portion of loans repayable on demand from banks of 209.26 crore (previous year: 132.58 crore), short term loans
and advances from banks of 124.75 crore (previous year: 420.76 crore), working capital facilities and other non-fund based
facilities viz. bank guarantees and letters of credit, are secured by hypothecation of inventories, book debts and receivables.
D(I) (b) Short term loans and advances from banks includes loans amounting to
under bill discounting facility and are secured against specific receivables.
10.21 crore (previous year: 254.88 crore) availed
NOTE [D(II)]
Current maturities of long term borrowings
Particulars
Unsecured
Term loan from banks [Note C(I)(c)]
Sales tax deferment loan [Note C(I)(d)]
Finance lease obligation [Note C(I)(e)]
Loans guaranteed by directors Nil (previous year: Nil)
160
As at 31-3-2013
As at 31-3-2012
crore
782.19
7.29
39.17
828.65
crore
1572.68
22.90
33.41
1628.99
Notes forming part of the Accounts (contd.)
NOTE [D(III)]
Trade payables
Particulars
Acceptances
Due to related parties:
Subsidiary companies
Associate companies
Joint venture companies
Micro and small enterprises [Note Q(22)]
Due to others
NOTE [D(IV)]
Other current liabilities
Particulars
Interest accrued but not due on borrowings
Interest accrued and due on borrowings
Unclaimed dividend
Unclaimed matured deposits
Due to customers (Construction & project related activity)
Advances from customers
Other payables (including sales tax, service tax, excise duty and others)
[Note D(IV)(a)]
As at 31-3-2013
As at 31-3-2012
crore
607.23
2288.05
44.39
30.32
68.40
13692.26
16730.65
crore
142.10
1659.85
199.61
6.34
62.37
13537.49
15607.76
As at 31-3-2013
As at 31-3-2012
crore
116.42
0.02
23.85
–
4369.41
8723.26
1119.69
crore
113.99
–
19.52
0.01
2911.75
9812.57
1151.56
14352.65
14009.40
D(IV) (a) Other payables includes due to directors 40.80 crore (previous year: 42.08 crore) being provision for commission to directors.
NOTE [D(V)]
Short term provisions
Particulars
As at 31-03-2013
As at 31-3-2012
crore
crore
crore
crore
Provision for employee benefits:
Gratuity [Note Q(8)(ii)(a)]
Compensated absences
Employee pension scheme [Note Q(8)(ii)(a)]
Post-retirement medical benefits plan [Note Q(8)(ii)(a)]
Bonus provision
Others:
Current tax [Net of payments made 1658.05 crore]
Proposed dividend [Note A(IX)]
Additional tax on dividend
Other provisions (AS 29 Related) [Note Q(15)]
1.11
416.54
11.98
5.77
10.79
3.74
1138.47
85.86
409.55
0.85
369.18
9.84
4.83
12.17
446.19
396.87
–
1010.46
101.44
603.27
1637.62
2083.81
1715.17
2112.04
161
Notes forming part of the Accounts (contd.)
NOTE [E(I)]
Tangible assets
Class of assets
As at
1-4-2012 Additions Deductions
Cost/valuation
As at
31-3-2013
Up to
31-3-2012
Depreciation
For the
year Deductions
Impairment
As at
31-3-2013
Book value
As at
31-3-2013
As at
31-3-2012
Up to
31-3-2013
crore
Land
Freehold
Leashold
Sub total - Land
Buildings
Owned
Leased out
Sub total - Buildings
Plant and equipment
Owned
Leased out
Taken on lease
Sub total - Plant & equipment
Computers
Owned
Taken on lease
Sub total - Computers
Office equipment
Owned
Sub total - Office equipment
Furniture and fixtures
Owned
Sub total - Furniture & fixture
Vehicles
Owned
Taken on lease
Sub total - Vehicles
Other assets
Owned
Railway sidings
Aircraft
Ships
Sub total - Other assets
Lease adjustment
Total
412.93
127.05
539.98
2244.94
144.28
2389.22
6138.05
37.53
142.10
6317.68
418.55
0.47
419.02
183.18
183.18
216.92
216.92
206.75
2.02
208.77
30.11
11.13
41.24
332.76
24.76
357.52
995.97
–
–
995.97
93.07
–
93.07
27.45
27.45
31.02
31.02
44.13
–
44.13
40.57
–
40.57
32.55
–
32.55
38.73
–
–
38.73
15.38
0.37
15.75
4.45
4.45
10.25
10.25
15.08
0.91
15.99
402.47
138.18
540.65
2545.15
169.04
2714.19
7095.29
37.53
142.10
7274.92
496.24
0.10
496.34
206.18
206.18
237.69
237.69
235.80
1.11
236.91
0.25
10.62
71.46
82.33
–
10357.10
–
–
–
–
–
1590.40
–
10.62
–
10.62
–
168.91
0.25
–
71.46
71.71
–
11778.59
–
5.88
5.88
307.30
4.13
311.43
1964.54
11.24
40.86
2016.64
216.58
0.45
217.03
81.01
81.01
101.40
101.40
80.58
1.56
82.14
0.25
6.97
17.50
24.72
–
2840.25
–
1.34
1.34
56.44
2.76
59.20
561.42
1.08
13.88
576.38
73.17
–
73.17
24.64
24.64
22.00
22.00
26.18
0.17
26.35
–
0.18
4.97
5.15
–
788.23
–
–
–
7.22
–
7.22
29.92
–
–
29.92
14.07
0.36
14.43
3.66
3.66
7.59
7.59
7.92
0.90
8.82
–
7.15
–
7.15
–
78.79
–
7.22
7.22
356.52
6.89
363.41
2496.04
12.32
54.74
2563.10
275.68
0.09
275.77
101.99
101.99
115.81
115.81
98.84
0.83
99.67
0.25
–
22.47
22.72
–
3549.69
–
–
–
–
–
–
–
6.93 #
–
6.93
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
6.93
previous year
8797.58
1717.13
157.61 10357.10
2218.52
673.52
51.79
2840.25
6.93
Add : Asset held for sale
Add : Capital work-in-progress
402.47
130.96
533.43
2188.63
162.15
2350.78
4599.25
18.28
87.36
4704.89
220.56
0.01
220.57
104.19
104.19
121.88
121.88
136.96
0.28
137.24
–
–
48.99
48.99
(3.07)
8218.90
0.10
8219.00
491.05
8710.05
412.93
121.17
534.10
1937.64
140.15
2077.79
4173.51
19.36
101.24
4294.11
201.97
0.02
201.99
102.17
102.17
115.52
115.52
126.17
0.46
126.63
–
3.65
53.96
57.61
(3.07)
7506.85
21.15
7528.00
697.53
8225.53
# Impairment up to 31-3-2013 6.93 crore. During the year Nil
1. Cost/valuation of freehold land includes 0.14 crore for which conveyance is yet to be completed.
2. Cost/valuation of buildings includes ownership accommodation:
(i)
(a)
in various co-operative societies and apartments and shop-owners’ associations:
82.58 crore, including 2340 shares of
50 each, 232 shares of 100 each and 2 shares of 250 each.
162
Notes forming part of the Accounts (contd.)
NOTE [E(I)] (contd.)
(b)
in various co-operative societies and apartments and shop-owners’ associations : 20.92 crore for which share certificates
are yet to be issued.
(c)
in proposed co-operative societies 12.80 crore.
(ii) of 4.39 crore in respect of which the deed of conveyance is yet to be executed.
(iii) of 8.45 crore representing undivided share in properties at various locations.
3. Additions during the year and capital work-in-progress include
10.54 crore (previous year: 19.79 crore) being borrowing cost
capitalised in accordance with Accounting Standard (AS)16 on “Borrowing Costs” as specified in the Companies (Accounting
Standards) Rules,2006. Asset wise break-up of borrowing costs capitalised is as follows:
Asset class
Building owned
Plant and equipment owned
Computer owned
Office equipment owned
Owned Building Leased Out
Capital Work-in-Progress
Total
2012-13
17.06
6.61
1.06
–
3.17
(17.36)
10.54
crore
2011-12
6.07
0.25
0.16
0.22
–
13.09
19.79
4. Depreciation for the year as per Statement of Profit and Loss include obsolescence 8.26 crore (previous year: 8.53 crore)
5.
6.
The Company had revalued as at October 1,1984 some of its land, buildings, plant and equipment and railway sidings at replacement/
market value which resulted in a net increase of 108.05 crore.
The Company had taken land for
converted into freehold land w.e.f June 4, 2012.
2.63 crore in Mysore from KIADB based on lease and sale agreement. The aforesaid land got
7. Own assets given on operating lease have been presented separately as leased out in the note as per Accounting Standard (AS) 19
”Leases“.
8. Cost/valuation as at April 1, 2012 of individual assets has been reclassified wherever necessary.
9. Out of its lease hold land at Hazira, the Company has given certain portion of land for the use of its subsidiary companies. The lease
deeds in respect of leasehold land given to the subsidiary companies are under execution.
NOTE [E(II)]
Intangible assets
Particulars
As at
1-4-2012 Additions Deductions
Cost/valuation
As at
31-3-2013
Up to
31-3-2012
Amortisation
For the
year Deductions
crore
Book value
Up to
31-3-2013
As at
31-3-2013
As at
31-3-2012
Specialised softwares
Technical knowhow
New product design and development
163.13
25.74
6.24
182.63
16.21
–
1.42
6.78
–
–
17.63
6.78
89.67
12.69
–
20.35
1.22
1.36
4.39
105.63
77.00
–
–
13.91
1.36
3.72
5.42
73.46
3.52
–
Total
previous year
Add: Intangible assets under development
179.34
33.94
6.24
207.04
102.36
22.93
4.39
120.90
86.14
76.98
159.09
20.25
–
179.34
83.96
18.40
–
102.36
105.79
191.93
61.15
138.13
163
Notes forming part of the Accounts (contd.)
NOTE [F]
Non-current investments (at cost unless otherwise specified)
Particulars
Long term investments
(1) Trade Investments
(i)
Investments in fully paid equity instruments
(a) Subsidiaries companies
(b) Associate companies
Less: Provision for diminution in value
(c) Other companies
Less: Provision for diminution in value
(ii) Other investments
Investment in integrated joint ventures
(2) Other Investments
Other fully paid equity shares
Non-current Investments (at cost unless otherwise specified)
Particulars
(1) Trade Investments
(i)
Investments in fully paid equity instruments
(a) Subsidiary companies:
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
10221.23
8687.19
66.91
0.56
19.90
15.90
92.46
0.56
42.90
15.90
91.90
27.00
182.57
10522.70
–
10522.70
66.35
4.00
140.88
8898.42
186.29
9084.71
Face value
per unit
Number of units
As at
31-3-2013
As at
31-3-2013
crore
As at
31-3-2012
crore
Audco India Limited * (prior to March 28, 2013, associate company)
Bhilai Power Supply Company Limited
EWAC Alloys Limited
Hi-Tech Rock Products & Aggregates Limited
Kesun Iron & Steel Company Private Limited
Larsen & Toubro Consultoria E Projeto Ltda
L&T-Gulf Private Limited
L&T Ahmedabad-Maliya Tollway Limited [ 1000 (previous year 1000)]
L&T Aviation Services Private Limited
L&T Capital Company Limited
L&T Cassidian Limited
L&T Finance Holdings Limited (quoted)
L&T Chennai-Tada Tollway Limited [ 1000 (previous year 1000)]
L&T Devihalli Hassan Tollway Limited [ 1000 (previous year 1000)]
L&T General Insurance Company Limited
L&T Halol-Shamlaji Tollway Limited [ 1000 (previous year 1000)]
L&T Howden Private Limited
L&T Infocity Limited
L&T Metro Rail (Hyderabad) Limited
Carried forward
100
10
100
10
10
R$ 1
10
10
10
10
10
10
10
10
10
10
10
10
10
15,63,260
49,950
8,29,440
50,000
9,500
96,819
40,00,016
100
4,56,00,000
2,20,00,000
37,000
1,41,70,24,221
100
100
41,50,00,000
100
1,50,30,000
2,40,30,000
53,00,000
201.54
0.05
150.24
0.05
0.01
0.27
4.00
–
45.60
22.00
0.04
1778.59
–
–
415.00
–
15.03
16.02
5.30
2653.74
–
0.05
150.24
0.05
0.01
0.27
4.00
–
24.00
22.00
0.04
1778.59
–
–
325.00
–
15.03
16.02
4.37
2339.67
164
Notes forming part of the Accounts (contd.)
NOTE [F]
Non-current investments (at cost unless otherwise specified) (contd.)
Particulars
(a) Subsidiary companies: (contd.)
Brought forward
L&T Infrastructure Development Projects Limited
L&T Kobelco Machinery Private Limited
L&T Krishnagiri Walajahpet Tollway Limited
[ 26000 (previous year 26000)]
L&T-MHI Boilers Private Limited
L&T-MHI Turbine Generators Private Limited
L&T Natural Resources Limited
L&T Power Development Limited
L&T Power Limited (Face value reduced from 30000 to 10 each)
L&T PowerGen Limited
L&T Rajkot-Vadinar Tollway Limited [ 1000 (previous year 1000)]
L&T Realty Limited
L&T Samakhiali Gandhidham Tollway Limited
L&T Sapura Offshore Private Limited
L&T Sapura Shipping Private Limited
L&T Seawoods Private Limited
L&T Shipbuilding Limited
L&T Solar Limited
L&T Special Steels and Heavy Forgings Private Limited
L&T Electricals and Automation Limited
L&T Transportation Infrastructure Limited
L&T Plastics Machinery Limited
L&T-Sargent & Lundy Limited
(Buyback of 625,001 shares @ 80 per share and Buyback of
284,091 shares @ 88 per share)
L&T Technologies Limited
L&T Technology Services Limited
L&T-Valdel Engineering Limited
Larsen & Toubro Infotech Limited
Larsen & Toubro International FZE
Larsen Toubro Arabia LLC
Larsen & Toubro LLC
Narmada Infrastructure Construction Enterprise Limited
PNG Tollway Limited
Raykal Aluminum Company Private Limited
Spectrum Infotech Private Limited
Tractor Engineers Limited
Total [1]-(i) (a)
(b) Associate companies:
AIC Structural Steel Construction (India) Private Limited
Audco India Limited (subsidiary company w.e.f. March 28, 2013)
Gujarat Leather Industries Limited
JSK Electricals Private Limited
L&T-Chiyoda Limited
L&T-Komatsu Limited
L&T-Ramboll Consulting Engineers Limited
Magtorq Private Limited
Carried forward
Face value
per unit
Number of units
As at
31-3-2013
As at
31-3-2013
crore
As at
31-3-2012
crore
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
10
–
10
31,28,59,096
2,55,00,000
2,600
11,93,91,000
17,37,06,000
50,000
1,79,90,00,000
51,157
50,000
100
4,71,60,700
13,000
6,000
9,53,11,850
10,000
81,86,80,000
50,000
39,96,00,000
50,000
1,08,64,000
–
27,82,736
10
10
10
5
Dhs 550500
Saudi Riyals
1000
USD 1
10
10
10
10
1,000
10
100
10
10
10
10
10
100
50,000
50,000
11,79,000
3,22,50,000
1,829
7,500
50,000
1,26,48,507
4,39,66,000
37,750
4,40,000
68,000
26,000
7,81,630
7,35,000
21,20,040
45,00,000
6,00,00,000
18,00,000
9,000
2653.74
2696.47
25.50
–
119.39
173.71
0.05
1799.00
0.05
0.05
–
47.16
0.01
0.01
95.31
0.01
818.68
0.05
399.60
0.05
10.86
–
0.82
0.05
0.05
23.89
134.25
1147.40
11.08
0.23
12.65
43.97
0.04
6.80
0.30
10221.23
0.03
–
0.56
2.12
4.50
60.00
1.80
4.42
73.43
2339.67
2696.47
25.50
–
112.25
127.55
0.05
1362.00
153.47
0.05
–
47.16
0.01
0.01
95.31
0.01
0.05
0.05
333.00
0.05
10.86
13.00
1.09
0.05
–
23.89
134.25
1147.40
–
0.23
12.65
43.97
0.04
6.80
0.30
8687.19
–
0.05
0.56
–
4.50
60.00
1.80
–
66.91
165
Notes forming part of the Accounts (contd.)
NOTE [F]
Non-current investments (at cost unless otherwise specified) (contd.)
Particulars
(b) Associate companies:
(contd.)
Brought forward
Rishi Consfab Private Limited
Salzer Electronics Limited (quoted)
Less: Provision for diminution in value
Total [1]-(i) (b)
(c) Other companies:
International Seaport Dredging Limited
Tidel Park Limited
Astra Microwave Products Limited (quoted)
Less: Provision for diminution in value
Total [1]-(i) (c)
(ii) Other investments
Integrated 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 Shanghai Urban Corporation Group Joint Venture
Metro Tunneling Group
Metro Tunneling Delhi - L&T SUCG Joint Venture
Metro Tunneling Chennai - L&T SUCG Joint Venture
L&T-Shapoorji Pallonji & Co. Ltd. Joint Venture -TCS
Total
Trade Investments-Total (1)
(2) Other Investments
Investments in fully paid equity Instruments
Other companies:
Satyam Computer Services Limited (quoted)
Utmal Multi purpose Service Co-operative Society Limited (B Class)
–
100
–
300
[ 30,000 (previous year 30,000)]
Other Investments-Total (2)
Total non current investments (1+2)
* Net of 50.02 crore being dividend received out of pre-acquisition profits.
Details of quoted/unquoted investments:
Particulars
(a) Aggregate amount of quoted investments and market value thereof;
Book Value
Market Value
(b) Aggregate amount of unquoted investments;
Book Value
(c) Aggregate provision for diminution in value of investments: 16.46 crore (previous year 16.46 crore)
166
Face value
per unit
Number of units
As at
31-3-2013
As at
31-3-2013
crore
As at
31-3-2012
crore
10
10
27,04,000
26,79,808
10,000
10
2
15,899
40,00,000
79,50,045
73.43
2.70
16.33
92.46
0.56
91.90
15.90
4.00
23.00
42.90
15.90
27.00
0.05
0.06
8.39
4.06
83.03
19.20
12.73
14.65
6.32
28.89
5.19
182.57
10,522.70
–
–
–
10522.70
66.91
–
–
66.91
0.56
66.35
15.90
4.00
–
19.90
15.90
4.00
0.05
0.37
9.21
11.50
71.33
19.36
12.53
13.02
3.03
0.48
–
140.88
8898.42
186.29
–
186.29
9084.71
As at
31-3-2013
crore
As at
31-3-2012
crore
1817.92
10503.90
1964.88
6965.91
8704.78
7119.83
Notes forming part of the Accounts (contd.)
NOTE [G(I)]
Long term loans and advances
Particulars
Secured considered good:
Loans against mortgage of house property
Rent deposit (KMP’s)
Capital advances
Unsecured considered good
Capital advances
Loans and advances to related parties:
Subsidiary companies
Loans [Note Q(2)(a)]
Advances towards equity commitment
Inter-corporate deposits including interest
accrued [Note Q(2)(a)]
Joint venture companies:
Loans
Other loans and advances
Security deposits
Earnest money deposits
Advances recoverable in cash or in kind
Balances with customs, port trust etc.
Lease receivable
NOTE [G(II)]
Cash and bank balances
Particulars
Cash and bank balances not available for immediate use
[Note G(II)(a)]
As at 31-3-2013
As at 31-3-2012
crore
5.60
0.01
1.69
122.36
–
2264.85
294.01
453.37
107.92
0.51
413.47
0.32
0.06
3664.17
crore
8.93
0.01
3.28
107.13
241.50
2382.08
633.64
283.63
75.16
0.60
319.27
0.32
0.42
4055.97
As at 31-3-2013
As at 31-3-2012
crore
39.02
39.02
G (II)(a) Particulars of cash and bank balances not available for immediate use
Particulars
1
2
3
4
Amount deposited under credit support arrangement which is refundable only on
cessation of exposure to a Bank
Amount received including interest accrued thereon from customers of property
development business – to be handed over to housing society on its formation
Contingency deposit (including interest accrued thereon) received from customers of
property development business towards their sales tax liability - to be refunded/adjusted
depending on the outcome of the legal case
Other bank balances not available for immediate use being in the nature of security
offered for bids submitted, loans availed, guarantees issued by bank on behalf of the
company, collaterals, earmarked grants etc.
Total
Less: Amount reflected under current assets [Note H-IV]
Amount reflected under non-current assets [Note G-II]
crore
127.14
127.14
crore
As at
31-3-2013
As at
31-3-2012
104.77
125.25
18.65
17.64
12.81
10.28
38.49
174.72
135.70
39.02
7.28
160.45
33.31
127.14
167
Notes forming part of the Accounts (contd.)
NOTE [G(III)]
Other Non Current Asset
Particulars
Unamortised expenses
NOTE [H(I)]
Current Investments
Particulars
(a) Current investments
Government and trust securities
Less: Provision for diminution in value
Debentures & Bonds
Less: Provision for diminution in value
Mutual funds
Less: Provision for diminution in value
Other current investments
Less: Provision for diminution in value
(b) Current portion of long term investments
As at 31-3-2013
As at 31-3-2012
crore
43.30
43.30
crore
14.07
14.07
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
112.87
0.86
1101.08
0.56
2102.56
–
2265.83
0.23
371.28
7.89
605.02
4.61
920.63
0.02
4907.76
6.37
112.01
1100.52
2102.56
2265.60
–
5580.69
363.39
600.41
920.61
4901.39
1.39
6787.19
Other particulars in respect of current investment mentioned in H(1) are as follows:
Particulars
(a) Current investments:
(1) Government and trust securities:
6.35% Government of India Bonds 2020 (quoted)
8.28% Government of India Bonds 2032 (quoted)
8.79% Government of India Bonds 2021 (quoted)
8.15% Government of India Bonds 2022 (quoted)
8.33% Government of India Bonds 2026 (quoted)
Less: Provision for diminution in value
Government and trust securities-Total
(2) Debentures and Bonds
(i)
Subsidiary companies:
L&T Finance Limited-10.24% Secured Redeemable
Non-Convertible Debentures, 2019 (quoted)
L&T Infrastructure Finance Company Limited-8.91%
Non-Convertible Debentures, 16-Apr-2012 (quoted)
Carried forward
168
Face value
per unit
Number of Units
As at
31-3-2013
As at
31-3-2013
crore
As at
31-3-2012
crore
100
100
100
100
100
–
5,00,000
–
5,00,000
1,00,00,000
–
4.91
–
5.09
102.87
112.87
0.86
112.01
1,000
3,69,770
36.98
10,00,000
–
–
36.98
40.48
4.99
325.81
–
–
371.28
7.89
363.39
36.98
24.98
61.96
Notes forming part of the Accounts (contd.)
Note [H(I)]
Current investments (contd.)
Particulars
Face value
per unit
Number of Units
As at
31-3-2013
As at
31-3-2013
crore
As at
31-3-2012
crore
(i)
Subsidiary companies: (contd.)
Brought forward
L&T Infrastructure Finance Company Limited - 8.91%
Non-Convertible Debentures, 16-Apr-2013 (quoted)
L&T Infrastructure Finance Company Limited - 8.91%
Non-Convertible Debentures, 16-Apr-2014 (quoted)
L&T Infrastructure Finance Company Limited - 8.91%
Non-Convertible Debentures, 16-Apr-2015 (quoted)
L&T Infrastructure Finance Company Limited - 8.91%
Non-Convertible Debentures, 15-Apr-2016 (quoted)
L&T Infrastructure Finance Company Limited - 8.91%
Non-Convertible Debentures, 14-Apr-2017 (quoted)
L&T Infrastructure Finance Company Limited - 8.91%
Non-Convertible Debentures, 16-Apr-2018 (quoted)
Less: Provision for diminution in value
Subsidiary companies-Total
(ii) Other Debentures and Bonds
Citi Corporation Non-Convertible Debentures
- Series 409 - 2014 (quoted)
10,00,000
10,00,000
10,00,000
10,00,000
10,00,000
10,00,000
1,00,000
HDFC Limited 9.95% Non-Convertible Debentures 2012 (quoted)
ICICI Bank Ltd. Non-Convertible Debentures 9.15%
10,00,000
10,00,000
- 31 December 2022 (quoted)
Tata Steel Limited 11.8% Non-Convertible Debentures,
Perpetual (quoted)
9.05% HDFC Ltd. Non-Convertible Debentures
29 January 2014 (quoted)
9.62% HDFC Ltd. Non-Convertible Debentures
27 February 2014 (quoted)
9.62% HDFC Ltd. Non-Convertible Debentures
26 February 2014 (quoted)
9.18% HDFC Ltd. Non-Convertible Debentures
22 October 2014 (quoted)
6.86% IIFCL 26 March 2023 (quoted)
7.18% IRFC Ltd. 19 February 2023 (quoted)
10.75% The Tata Power Co. Ltd. Non-Convertible Debentures
21 August 2072 (quoted)
8.00% Indian Overseas Bank 2016 Bonds (quoted)
8.20% Power Finance Corporation 2022 (quoted)
9.32% National Bank for Agricultural and
Rural Developement 2015 (quoted)
9.40% National Bank for Agricultural and
Rural Developement 2015 (quoted)
9.46% Power Finance Corporation 2026 (quoted)
9.61% Power Finance Corporation 2021 (quoted)
9.70% Power Finance Corporation 2021 (quoted)
9.75% Rural Electrification Corporation Limited 2021 (quoted)
8.20% National Highway Authority of India 2022 (quoted)
10,00,000
10,00,000
10,00,000
10,00,000
10,00,000
1,000
1,000
10,00,000
10,00,000
1,000
10,00,000
10,00,000
10,00,000
10,00,000
10,00,000
10,00,000
1,000
Less: Provision for diminution in value
Other Debentures and Bonds-Total
Debentures-Total
250
250
250
–
–
–
–
–
50
–
1,500
1,000
750
150
2,50,000
30,00,000
1,000
50
8,54,355
100
–
200
16
100
50
7,41,713
36.98
24.95
24.95
24.95
–
–
–
111.83
0.30
111.53
–
–
5.00
–
149.74
100.34
75.29
14.99
25.00
300.00
101.05
4.90
89.23
10.00
–
19.99
1.60
10.03
5.18
76.91
989.25
0.26
988.99
1100.52
61.96
24.98
24.98
24.98
24.98
24.98
24.97
211.83
3.06
208.77
50.13
5.00
–
101.75
–
–
–
–
–
–
–
4.90
85.44
10.00
25.00
19.99
1.60
10.03
5.18
74.17
393.19
1.55
391.64
600.41
169
Notes forming part of the Accounts (contd.)
Note [H(I)]
Current investments (contd.)
Particulars
(3) Mutual funds:
Face value
per unit
Number of Units
As at
31-3-2013
As at
31-3-2013
crore
As at
31-3-2012
crore
Baroda Pioneer Liquid Fund-Plan A-Growth
Birla Sun Life Fixed Term Plan-Series CY-Growth (quoted)
Birla Sun Life Fixed Term Plan-Series DB (369 Days) Growth (quoted)
DSP Blackrock Liquidity Fund-IP-Growth
DWS Fixed Term-Series 80-Growth (quoted)
DWS Insta Cash Plus Fund-Regular Bonus-Growth
DWS Insta Cash Plus Fund-Super Institutional Plan-Bonus
DWS Money Plus Fund-Regular Plan-Bonus
DWS Treasury Fund-Cash-Reg-Bonus
DWS Ultra Short Term Fund-Regular Bonus Option
HDFC Liquid Fund-Growth
ICICI Prudential FMP Series 56-1Year Plan E-Growth (quoted)
IDBI Liquid Fund-Growth
IDFC Cash Fund-Reg-Growth
JM High Liquidity Fund-Bonus Option-Bonus Units
JP Morgan India Liquid Fund-Super IP-Growth
JP Morgan India Treasury Fund-Direct Plan-Bonus
L&T Cash Fund-Growth
L&T FMP-II (Jan 15M A)-Growth (quoted)
L&T FMP-III (June 366D A)-Growth (quoted)
L&T FMP-V (December 366D A)-Growth (quoted)
L&T FMP-V (December 368D A)-Growth (quoted)
L&T FMP-V (February 368D A)-Growth (quoted)
L&T FMP-VII (January 507D A)-Growth (quoted)
L&T FMP-VII (March 13M A)-Growth (quoted)
L&T FMP-VII (March 367D A)-Growth (quoted)
L&T FMP-VII (March 367D B)-Growth (quoted)
L&T FMP-VII (March 381D A)-Growth (quoted)
L&T FMP-IV (September 367D A)-Growth (quoted)
L&T Income Opportunities Fund-Growth
L&T Liquid Fund-Growth
L&T Liquid Fund-Institutional Plus Plan-Daily Dividend Reinvest
L&T Short Term Opportunities Fund-Growth
LIC Nomura FMP Series 48 Growth (quoted)
Principal Cash Management Fund-Growth-Bonus
Reliance Fixed Horizon Fund XIX-Series 4-Growth (quoted)
Religare FMP Series IX Plan D (370 Days) Growth (quoted)
Religare FMP Series VII-Plan C (369 Days) Growth (quoted)
Religare FMP-Series XI-Plan E (371 Days)-Growth (quoted)
Religare Liquid Fund-Growth
SBI Premier Liquid Fund-Growth
SBI Premier Liquid Fund-Super Institutional Plan
- Daily Dividend Reinvestment
UTI Fixed Term Income Fund-Series IX-II (369 Days)-Dividend (quoted)
UTI Fixed Term Income Fund-Series IX-(367 Days)-Growth (quoted)
UTI Treasury Advantage Fund IP-Bonus
1,000
10
10
1,000
10
10
100
10
10
10
10
10
1,000
1,000
7,44,632
–
–
2,98,155
–
–
13,95,466
5,70,81,186
15,12,022
–
2,16,45,022
–
1,98,809
3,50,958
10 45,49,23,434
3,29,12,709
10
6,57,31,094
10
28,24,285
1,000
–
10
–
10
–
10
–
10
–
10
2,00,00,000
10
1,00,00,000
10
1,00,00,000
10
50,00,000
10
1,00,00,000
10
–
10
–
10
21,77,844
1,000
–
1,000
2,23,49,962
10
–
10
3,36,795
1,000
–
10
–
10
–
10
–
10
6,20,694
1,000
5,42,948
1,000
1,000
10
10
1,000
–
–
–
2,32,098
Less: Provision for diminution in value
Mutual funds-Total
(4) Other Current investments:
(i)
Collateralized borrowing and lending obligation (CBLO)
CBLO-Total
(ii) Commercial paper:
10.25% IDFC Limited 22 October 2012
NA
5,00,000
NA
–
Less: Provision for diminution in value
Commercial paper-Total
170
100.00
–
–
50.00
–
–
13.92
55.79
14.79
–
50.00
–
25.00
50.00
446.91
50.00
100.00
450.00
–
–
–
–
–
20.00
10.00
10.00
5.00
10.00
–
–
350.00
–
25.09
–
37.50
–
–
–
–
100.00
100.00
–
–
–
28.56
2102.56
–
2102.56
–
–
–
–
–
–
–
53.19
10.60
–
37.22
8.71
–
–
–
88.81
–
26.60
–
–
–
–
–
–
10.87
7.36
5.00
8.03
12.00
–
–
–
–
–
2.50
30.46
–
250.11
–
10.39
–
21.26
4.00
15.92
10.00
–
–
260.12
32.35
15.13
–
920.63
0.02
920.61
71.96
71.96
93.64
93.64
0.45
93.19
Notes forming part of the Accounts (contd.)
Note [H(I)]
Current investments (contd.)
Particulars
(iii) Certificate of deposits:
Face value
per unit
Number of Units
As at
31-3-2013
As at
31-3-2013
crore
As at
31-3-2012
crore
Allahabad Bank 10 June 2013
Allahabad Bank 31 May 2012
Andhra Bank 14 June 2012
Axis Bank 06 June 2013
Axis Bank 31 January 2013
Axis Bank 21 February 2013
Axis Bank 22 November 2012
Axis Bank 29 June 2012
Bank of Baroda 06 December 2013
Bank of India 15 March 2013
Canara Bank 01 March 2013
Canara Bank 07 March 2013
Canara Bank 13 December 2012
Canara Bank 14 December 2012
Canara Bank 14 March 2013
Canara Bank 18 March 2013
Canara Bank 20 February 2013
Canara Bank 24 February 2014
Canara Bank 26 December 2012
Canara Bank 26 February 2013
Central Bank of India 15 February 2013
Central Bank of India 15 June 2012
Central Bank of India 17 December 2012
Central Bank of India 18 February 2013
Corporation Bank 05 December 2013
Corporation Bank 06 March 2014
Corporation Bank 10 December 2013
Corporation Bank 17 February 2014
Corporation Bank 19 June 2012
Corporation Bank 22 November 2013
IDBI Bank 12 July 2012
IDBI Bank 05 December 2013
IDBI Bank 10 February 2014
IDBI Bank 24 December 2012
IDBI Bank 26 June 2012
Indian Overseas Bank 06 July 2012
Indian Overseas Bank 22 January 2013
Indian Overseas Bank 14 March 2014
Oriental Bank of Commerce 03 January 2014
Oriental Bank of Commerce 05 March 2014
Oriental Bank of Commerce 06 December 2012
Oriental Bank of Commerce 07 August 2012
Oriental Bank of Commerce 07 December 2012
Oriental Bank of Commerce 12 December 2012
Oriental Bank of Commerce 13 December 2012
Oriental Bank of Commerce 20 June 2012
Oriental Bank of Commerce 21 January 2013
Oriental Bank of Commerce 30 May 2013
Oriental Bank of Commerce 30 November 2012
Punjab and Sind Bank 21 June 2012
Punjab National Bank 03 July 2012
Punjab National Bank 05 March 2014
Punjab National Bank 06 Decemebr 2012
Punjab National Bank 10 March 2014
Punjab National Bank 12 July 2012
Punjab National Bank 14 June 2012
Carried forward
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
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
1,00,000
1,00,000
1,00,000
1,00,000
22,500
–
–
20,000
–
–
–
–
2,500
–
–
–
–
–
–
–
–
5,000
–
–
–
–
–
–
7,500
10,000
5,000
15,000
–
5,000
–
2,500
2,500
–
–
–
–
5,000
5,000
2,500
–
–
–
–
–
–
–
10,000
–
–
–
25,000
–
20,000
–
–
220.86
–
–
196.61
–
–
–
–
23.55
–
–
–
–
–
–
–
–
46.20
–
–
–
–
–
–
70.67
92.17
47.06
138.79
–
47.25
–
23.54
23.18
–
–
–
–
46.04
46.76
23.08
–
–
–
–
–
–
–
98.48
–
–
–
230.86
–
184.48
–
–
1559.58
–
98.13
48.86
–
181.76
45.38
22.80
96.41
–
91.15
294.95
90.49
46.58
69.21
113.98
45.22
90.84
–
160.75
136.31
22.85
48.84
69.28
160.09
–
–
–
–
48.80
–
22.77
–
–
23.01
72.61
22.90
45.66
–
–
–
68.80
46.56
68.98
91.26
23.08
48.79
136.63
–
92.28
48.78
23.89
–
23.12
–
22.89
48.87
2913.56
171
Notes forming part of the Accounts (contd.)
Note [H(I)]
Current investments (contd.)
Particulars
(iii) Certificate of deposits: (contd.)
Brought forward
Punjab National Bank 15 March 2013
Punjab National Bank 18 December 2012
Punjab National Bank 25 February 2013
Punjab National Bank 25 March 2014
Punjab National Bank 29 November 2012
Punjab National Bank 31 January 2013
State Bank of Bikaner & Jaipur 10 September 2012
State Bank of Bikaner & Jaipur 19 December 2012
State Bank of Bikaner & Jaipur 24 December 2012
State Bank of Hyderabad 03 December 2012
State Bank of Hyderabad 06 December 2012
State Bank of Hyderabad 06 September 2013
State Bank of Hyderabad 07 November 2012
State Bank of Hyderabad 13 March 2014
State Bank of Hyderabad 23 January 2013
State Bank of Hyderabad 26 December 2012
State Bank of Mysore 29 November 2013
State Bank of Mysore 24 May 2012
State Bank of Patiala 03 June 2013
State Bank of Patiala 03 August 2012
State Bank of Patiala 03 September 2012
State Bank of Patiala 12 December 2012
State Bank of Travancore 13 August 2012
State Bank of Travancore 22 November 2013
Syndicate Bank 06 August 2012
Syndicate Bank 15 June 2012
Syndicate Bank 18 December 2012
Syndicate Bank 26 December 2012
Syndicate Bank 28 September 2012
Syndicate Bank 21 January 2013
Syndicate Bank 30 July 2012
UCO Bank 03 April 2012
UCO Bank 05 June 2012
UCO Bank 05 March 2014
UCO Bank 10 March 2014
UCO Bank 14 March 2014
Union Bank of India 03 December 2012
United Bank of India 24 May 2013
Less: Provision for diminution in value
Certificate of deposits-Total
Other Current investments-Total (5) (i+ii+iii)
(b) Current portion of long term investments: H(1)(b)
Bonds
Nakheel Anka Sukuk Limited
Bonds-Total
Total current investments-(a+b)
Details of quoted/unquoted investments:
Particulars
Face value
per unit
Number of Units
As at
31-3-2013
As at
31-3-2013
crore
As at
31-3-2012
crore
–
–
–
10,000
–
–
–
–
–
–
–
5,000
–
5,000
–
–
25,000
–
2,500
–
–
–
–
5,000
–
–
–
–
–
–
–
–
–
2,500
5,000
5,000
–
10,000
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
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
AED 10,000
1559.58
–
–
–
91.60
–
–
–
–
–
–
–
48.12
–
46.08
–
–
235.79
–
23.66
–
–
–
–
47.25
–
–
–
–
–
–
–
–
–
23.08
46.08
46.08
–
98.51
2265.83
0.23
2265.60
2265.60
–
–
5580.69
2913.56
91.12
138.81
90.85
–
46.40
182.36
94.67
92.51
23.22
46.31
22.93
–
23.34
–
68.72
22.81
–
24.02
–
46.00
92.03
138.82
22.85
–
46.58
73.32
23.05
45.96
94.20
91.07
46.41
44.95
48.99
–
–
–
46.30
–
4742.16
5.92
4736.24
4901.39
1.39
1.39
6787.19
As at
31-3-2013
crore
As at
31-3-2012
crore
1268.94
1324.54
1246.20
1275.22
4311.75
5540.99
(a) Aggregate amount of quoted current investments and market value thereof;
Book Value
Market Value
(b) Aggregate amount of unquoted current investments;
Book Value
(c) Aggregate provision for diminution in value of current investments: 1.65 crore (previous year 18.89 crore)
172
Notes forming part of the Accounts (contd.)
NOTE [H(II)]
Inventories (at cost or net realisable value whichever is lower)
Particulars
Raw Materials
[Includes goods-in-transit 34.75 crore (previous year 16.93 crore)]
Components
[Includes goods-in-transit 77.64 crore (previous year 52.72 crore)]
Construction material
[Includes goods-in-transit 0.31 crore (previous year 1.99 crore)]
Manufacturing work-in-progress [Note Q(25)(d)]
Finished goods
Stock in trade (in respect of goods acquired for trading)
[Includes goods-in-transit 31.82 crore (previous year 50.99 crore)]
Stores and spares
[Includes goods-in-transit 4.14 crore (previous year 2.43 crore)]
Loose tools
Property development related work-in-progress [Note Q(6)(b)]
NOTE [H(III)]
Trade receivables
As at 31-3-2013
As at 31-3-2012
crore
451.07
348.08
0.74
646.59
209.11
169.19
84.62
5.02
149.76
2064.18
crore
418.58
330.94
2.02
466.29
237.88
196.33
80.05
4.51
40.02
1776.62
Particulars
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
Secured:
Other debts (Debts outstanding for less than 6 months)
Considered good
Unsecured:
Debts outstanding for more than 6 months
Considered good
Considered doubtful
Other debts: [Note H(III)(a)]
Considered good
Considered doubtful
Less: Allowance for doubtful debts
0.77
–
0.77
–
1978.70
514.40
2493.10
20633.54
0.34
23126.98
514.74
1633.70
603.16
2236.86
17083.24
–
19320.10
603.16
22612.24
22613.01
18716.94
18716.94
H(III)(a) Unsecured-other debts includes 15531.50 crore (previous year: 12393.15 crore) contractually not due.
173
Notes forming part of the Accounts (contd.)
NOTE [H(IV)]
Cash and bank balances
Particulars
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
Cash and cash equivalent
Balance with banks
Cheques and drafts on hand
Cash on hand
Fixed deposits with banks (maturity less than 3 months)
Other bank balances
Fixed deposits with banks including interest accrued thereon
[including Nil crore of bank deposits with more than 12 months
maturity (previous year: 0.02 crore)]
Earmarked balances with banks-unclaimed dividend
Margin money deposits
Cash and bank balances not available for immediate use
[Note G(II)(a)]
Bank balances subject to restriction on repatriation
[Note H(IV)(a)]
708.93
337.20
3.23
230.16
2.58
23.85
5.07
135.70
8.94
555.71
272.60
2.87
856.93
1279.52
1688.11
13.09
19.52
15.15
33.31
8.94
176.14
1455.66
90.01
1778.12
crore
The balance represents fixed deposit/call deposit against loan taken from Rafidian
Bank. The deposit with Mashreq Bank is subject to an escrow arrangement duly
approved by the Reserve Bank of India. The proceeds of both deposits, together
with interest thereon, would be applied towards full and final settlement of loan
taken from Rafidian Bank, Iraq which is disclosed as loan repayable on demand
vide Note (D)(I) for an equivalent amount of 8.94 crore.
NOTE H(IV)(a)
Particulars
Rafidian Bank
31-3-2013
31-3-2012
8.25
8.25
Mashreq Bank
0.69
0.69
Total
8.94
8.94
NOTE [H(V)]
Short term loans and advances
Particulars
Secured considered good:
Loans against mortgage of house property:
Key management personnel
Others
Unsecured
Considered good:
Subsidiary companies
Loans [Note Q(2)(a)]
Inter-corporate deposits including interest
accrued [Note Q(2)(a)]
Others
Carried forward
174
As at 31-3-2013
As at 31-3-2012
crore
crore
–
1.72
200.00
605.35
841.00
1648.07
0.28
1.76
318.20
49.51
1116.77
1486.52
Notes forming part of the Accounts (contd.)
NOTE [H(V)]
Short term loans and advances (contd.)
Particulars
Brought forward
Associate companies
Advance recoverable
Joint ventures companies
Loans
Advance recoverable
Advances to supliers
Others
Considered good:
Security deposits
Earnest money deposits
Advances recoverable in cash or kind
Income tax receivable of current year
[net of provision of 1814.10 crore in previous year]
Balance with customs, port trust etc.
Lease receivable
Considered doubtful:
Deferred credit against sale of ships
Security deposits
Other loans and advances
Less: Allowance for doubtful loans and advances
As at 31-3-2013
As at 31-3-2012
crore
1648.07
6.69
–
0.04
20.48
167.50
72.40
3528.78
–
54.44
0.44
22.58
1.40
131.79
5654.61
155.77
5498.84
crore
1486.52
11.47
84.04
–
10.18
132.64
36.16
3078.60
95.22
70.34
0.45
21.16
0.47
130.80
5158.05
152.43
5005.62
NOTE [H(VI)]
Other current asset
Particulars
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
Other current assets:
Due from customers (construction and project related activity)
Due from customers (property development activity) [Note (Q)(6)(b)]
Interest accrued on investments
Unbilled revenue
Unamortised expenses
11692.89
1.83
35.66
48.63
11.65
11781.47
-
93.84
42.33
4.72
11790.66
11790.66
11922.36
11922.36
175
Notes forming part of the Accounts (contd.)
NOTE [I]
Contingent liabilities
Particulars
(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
(d)
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
(e) Corporate guarantees given on behalf of subsidiary companies
As at 31-3-2013
As at 31-3-2012
crore
177.97
112.60
41.21
390.39
4422.32
crore
198.15
107.04
28.59
198.38
1570.47
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), the cash outflows, if any, could generally occur up to eight 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.
NOTE [J]
Commitments
Particulars
(a) Estimated amount of contracts remaining to be excuted on capital account (net of advances )
As at
31-3-2013
As at
31-3-2012
crore
390.48
crore
397.30
(b) Estimated amount of committed funding by way of equity/loans to subsidiary and associate companies
7453.00
7809.00
NOTE [K]
Revenue from operations
Particulars
Sales & service:
2012-13
2011-12
Note
crore
crore
crore
crore
Manufacturing and trading activity
Property development activity
Construction and project related activity
Servicing
Commission
Engineering and service fees
Q (25)(a) (i)
Q(25)(a)(ii), Q(6)(b)
Q(6)(a), Q(25)(a)(iii)
Q(25)(a)(iv)
Q(25)(a)(v)
Q(25)(a)(vi)
6375.70
73.79
52618.63
406.08
158.77
1215.03
6367.59
21.70
45356.71
285.63
205.01
875.74
60848.00
53112.38
Other operational revenue:
Income from hire of plant and equipment
Technical fees
Company’s share in profit of Integrated
joint ventures
Lease rentals
Income from services to the Group companies
Premium earned (net) on related forward
exchange contract
Miscellaneous income
Q14(b)
9.63
53.80
10.10
49.73
95.62
245.91
158.07
9.95
62.58
5.13
40.72
67.44
254.72
184.86
622.86
61470.86
625.40
53737.78
176
Notes forming part of the Accounts (contd.)
K(I) Revenue from sales & service include:
(a)
691.63 crore (previous year: 298.88 crore) for price variations net of liquidated damages in terms of contracts with the
customers.
(b) Shipbuilding subsidy 10.02 crore (previous year : 2.09 crore) and reversal of shipbuilding subsidy of 7.22 crore (previous
year : 18.24 crore).
Note [L]
Other Income
Particulars
Interest income:
Interest income on long term investments
Interest income on current investments
Interest income on others:
Subsidiary and associate companies
Others
Dividend income:
From long term investments:
Subsidiary companies
Associate companies
Other trade investments
Other investments
From current investments
Net gain/(loss) on sale of investment:
Long term investments (net)
Current investments (net)
Net gain/(loss) on sale of fixed assets (net)
Lease rental
Miscellaneous income (net of expenses) [Note L(I)]
2012-13
2011-12
crore
crore
crore
crore
0.40
310.92
181.27
40.10
583.21
1.80
–
1.20
586.21
3.45
24.71
224.21
0.35
407.20
126.97
34.42
532.69
568.94
385.13
22.58
7.50
1.20
416.41
47.78
(1.75)
124.39
589.66
248.92
226.29
43.68
209.66
1850.90
464.19
122.64
13.24
18.98
150.29
1338.28
[L(I)] Miscellaneous income includes recoveries from subsidiary, joint venture and associate companies towards directly attributable expenses
incurred on employees deputed to these companies. Such expenses, the details of which are given hereunder, have been netted off
from miscellaneous income.
Expenses
2012-13
2011-12
Salaries
Contribution to Provident Fund
Compensation for Employee Stock Option Plan (ESOP)
Welfare expenses
Other expenses
Total
crore
81.06
1.94
6.18
1.02
2.31
92.51
crore
74.07
1.84
10.52
2.93
2.46
91.82
177
Notes forming part of the Accounts (contd.)
NOTE [M]
Manufacturing, construction and operating expenses
Particulars
2012-13
2011-12
crore
crore
crore
crore
Materials consumed:
Raw materials and components [Note Q(25)(b)]
Less: Scrap sales
Construction materials
Purchase of stock in trade [Note Q(25)(c)]
Value of stock in trade transferred on sale of business
Stores, spares and tools consumed
Sub-contracting charges
Changes in inventories of finished goods, work-in-progress
and stock-in-trade and property development:
Closing stock:
Finished goods
Stock in trade
Work-in-progress
Less: Opening stock:
Finished goods
Stock in trade
Work-in-progress
Other manufacturing, construction and operating expenses:
Excise duty
Power and fuel [Note O(I)]
Royalty and technical know-how fees
Packing and forwarding [Note O(I)]
Hire charges-plant & equipment and others
Engineering, technical and consultancy fees
Insurance [Note O(I)]
Rent [Note O(I)]
Rates and taxes [Note O(I)]
Travelling and conveyance [Note O(I)]
Repairs to plant and equipment
Repairs to buildings [Note O(I)]
General repairs and maintenance [Note O(I)]
Bank guarantee charges
Miscellaneous expenses [Note O(I)]
178
11039.28
146.99
2078.47
(15.24)
209.11
169.19
3199.91
3578.21
237.88
196.33
2011.97
2446.18
(6.27)
758.99
7.07
240.33
1031.57
690.66
137.34
282.76
180.97
720.41
47.80
13.41
208.89
77.74
395.96
10092.12
12527.42
2369.40
1622.83
10747.27
10892.29
14581.12
2063.23
2288.10
14472.06
10203.82
111.70
2384.73
(15.33)
237.88
196.33
2011.97
2446.18
233.37
200.66
1472.38
1906.41
(1132.03)
(539.77)
16.27
638.79
18.07
210.75
879.63
786.48
121.00
209.24
186.21
530.37
51.24
12.68
177.91
66.46
298.02
4787.63
47952.40
4203.12
41022.39
Notes forming part of the Accounts (contd.)
NOTE [N]
Employee benefits expense
Particulars
Salaries, wages and bonus
Contribution to and provision for:
Provident funds and pension fund
Superannuation/employee pension schemes
[Including provision 10.53 crore (previous year: 17.97 crore)]
Gratuity funds [Note Q(8)(b)]
[Including provision 0.26 crore (previous year: 0.01 crore)]
Expenses on Employee Stock Option Schemes [Note A(VIII)(e)(ii)]
Insurance expenses-Medical and others [Note O(I)]
Staff welfare expenses
[Note L(I) for employee benefits expense netted off]
NOTE [O]
Sales, administration and other expenses
Particulars
Power and fuel [Note O(I)]
Packing and forwarding [Note O(I)]
Professional fees
Audit fees [Note Q(17)]
Insurance [Note O(I)]
Rent [Note O(I)]
Rates and taxes [Note O(I)]
Travelling and conveyance [Note O(I)]
Repairs to buildings [Note O(I)]
General repairs and maintenance [Note O(I)]
Directors’ fees
Telephone, postage and telegrams
Advertising and publicity
Stationery and printing
Commission:
Distributors and agents
Others
Bank charges
Carried Forward
2012-13
2011-12
crore
crore
crore
3602.34
crore
2863.47
120.89
31.69
44.97
102.39
28.79
53.38
197.55
85.41
53.01
498.01
4436.32
2012-13
2011-12
crore
crore
crore
59.08
204.93
157.98
3.44
15.35
109.01
55.57
222.12
13.43
207.57
0.28
99.25
81.46
45.09
29.24
3.41
29.21
17.00
32.65
42.31
1349.52
184.56
156.73
40.10
421.23
3666.09
crore
49.10
103.70
170.50
2.44
9.75
95.02
38.65
178.03
21.14
168.91
0.30
83.04
76.86
37.85
46.21
34.75
1116.25
179
Notes forming part of the Accounts (contd.)
NOTE [O]
Sales, administration and other expenses (contd.)
Particulars
Brought Forward
Miscellaneous expenses [Note O(I)]
Bad debts and advances written off
Less: Allowance for doubtful debts and advances written back
Company’s share in loss of integrated joint ventures [Note Q(14)(b)]
Discount on sales
Allowance for doubtful debts and advances (net)
Provision/(reversal) for foreseeable losses on construction contracts
Provision/(reversal) for diminution in value of investments(net)
Exchange (gain)/loss (net)
Other provisions [Note Q(15)(a)]
2012-13
2011-12
crore
crore
crore
41.40
31.30
101.57
78.58
1349.52
299.06
22.99
22.62
72.17
(5.83)
44.89
(17.24)
396.02
(93.12)
2091.08
O(I) Aggregation of expenses disclosed vide notes M, N and O in respect of specific items are as follows:
crore
1116.25
288.61
10.10
23.99
58.43
180.11
42.86
(6.44)
458.55
45.72
2218.18
crore
Note O
59.08
204.93
15.35
109.01
55.57
222.12
13.43
207.57
299.06
Sr No.
Nature of expenses
2012-13
Note M
Note N
758.99
240.33
137.34
282.76
180.97
720.41
13.41
208.89
395.96
–
–
53.01
–
–
–
–
–
–
1
2
3
4
5
6
7
8
Power and fuel
Packing & forwarding
Insurance
Rent
Rates & taxes
Travelling and conveyance
Repairs to buildings
General repairs and maintenance
9 Miscellaneous expenses
NOTE [P]
Finance costs
Particulars
Interest expenses
Other borrowing costs
Exchange loss (attributable to finance costs)
Total
Note M
Note N
Note O
Total
2011-12
818.07
445.26
205.70
391.77
236.54
942.53
26.84
416.46
695.02
638.79
210.75
121.00
209.24
186.21
530.37
12.68
177.91
298.02
2012-13
crore
916.30
7.83
58.27
982.40
–
–
49.10
687.89
103.70
314.45
40.10
9.75
170.85
–
–
–
–
–
–
95.02
304.26
38.65
224.86
178.03
708.40
21.14
33.82
168.91
346.82
288.61
586.63
2011-12
crore
604.11
6.14
55.85
666.10
180
Notes forming part of the Accounts (contd.)
NOTE [Q]
Q(1) The Balance Sheet as on March 31, 2013 and the Statement of Profit and Loss for the year ended March 31, 2013 are drawn and
presented as per the new Schedule VI to the Companies Act, 1956.
Q(2) Particulars in respect of loans and advances in the nature of loans as required by the listing agreement:
crore
Name of the company
Balance as at
31-3-2013
31-3-2012
Maximum outstanding during
2011-12
2012-13
(a)
Loans and advances in the nature of loans given to subsidiaries:
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Larsen & Toubro Infotech Limited
Tractor Engineers Limited
L&T Finance Limited
L&T Capital Company Limited
L&T Seawoods Private Limited
L&T Infrastructure Development Projects Limited
L&T Infrastructure Finance Company Limited
L&T Realty Limited
L&T Chennai Projects Private Limited
(Formally known as L&T Arun Excello IT SEZ Private Limited)
L&T Commercial Projects Private Limited (Formally known
as L&T Arun Excello Commercial Projects Private Limited)
L&T Finance Holdings Limited
L&T Shipbuilding Limited
L&T Special Steels & Heavy Forgings Private Limited
L&T Uttaranchal Hydropower Limited
L&T Sapura Offshore Private Limited
L&T Rajkot-Vadinar Tollway Limited
PNG Tollway Limited
L&T Urban Infrastructure Limited
L&T Infocity Limited
EWAC Alloys Limited
–
–
–
–
–
–
–
751.47
177.01
–
–
–
46.09
–
4.12
–
47.84
36.83
36.00
–
–
168.01
–
–
25.26
–
13.14
–
–
–
Total
1099.36 *
1242.85 *
( b)
Loans and advances in the nature of loans where repayment schedule
is not specified/is beyond 7 years:
L&T Shipbuilding Limited
PNG Tollway Limited
1
2
Total
(c)
Loans and advances in the nature of loans where interest is not
charged or charged below bank rate:
L&T Capital Company Limited
L&T Realty Limited
L&T Seawoods Private Limited
Tractor Engineers Limited
1
2
3
4
Total
–
47.84
47.84
–
200.00
–
–
200.00
168.00
13.14
181.14
103.50
200.00
256.20
–
559.70
–
24.25
–
103.50
256.20
–
–
465.00
159.92
5.00
24.37
–
103.50
265.20
–
–
809.93
177.01
101.48
49.00
100.05
103.50
256.20
253.29
231.32
1002.08
159.93
27.57
29.07
27.57
–
169.19
46.09
–
26.25
–
47.84
338.81
135.23
11.98
470.37
182.46
–
264.90
25.26
39.02
13.14
–
–
–
169.19
47.84
182.46
13.14
103.50
200.00
265.20
18.00
103.50
796.00
256.20
–
* Long term loans and advances [Note G(I)] - 294.01 crore (previous year: 875.14 crore)
Short term loans and advances [Note H(V)] - 805.35 crore (previous year: 367.71 crore)
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.
181
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Q(3) Extraordinary and Exceptional Items [Note R(4)]:
(a) Exceptional items for the year ended March 31, 2013 include the following:
Expenses incurred amounting to 38.34 crore on voluntary retirement scheme;
(i)
(ii) Gain of 214.29 crore on sale of the Company’s stake in L&T Plastics Machinery Private Limited, a subsidiary company.
Exceptional items for the year ended March 31, 2012 included profit of
Raykal Aluminium Company Private Limited, a subsidiary company.
55.00 crore on sale of the Company’s part stake in
(b) Extraordinary items during the year ended March 31, 2013 represent the following:
(i)
Reversal of 52.89 crore (previous year: Nil) being provision made in earlier years in respect of the Company’s Investment
in shares of Satyam Computer Services Limited (SCSL);
(ii) Gain of 25.22 crore (net of tax 18.72 crore) on sale of the Company’s Medical Equipment Business unit. Tax of 6.50
crore included under current tax.
Q(4) The expenditure on research and development activities recognised as expense in the Statement of Profit and Loss is 98.17 crore
(previous year: 83.33 crore). Further, the Company has incurred capital expenditure on research and development activities as follows:
(a) on tangible assets of 12.45 crore (previous year: 17.17 crore);
(b) on intangible assets being expenditure on new product development of 43.76 crore (previous year: 38.58 crore) [Note 5(b)];
and
(c) on other intangible assets of 0.96 crore (previous year: 1.11 crore).
In addition, the Company has carried out work of a developmental nature of
partially/fully paid for by the customers.
21.27 crore (previous year: 13.06 crore) which is
Q(5) (a) Provision for current tax includes 20.25 crore in respect of income tax payable outside India (previous year : 8.32 crore)
(b) Tax effect of 0.17 crore (previous year : 0.03 crore) on account of debenture issue expenses has been credited to securities
premium account.
Q(6) (a) Disclosures pursuant to Accounting Standard (AS) 7 (Revised) “Construction Contracts”:
Particulars
i)
ii)
iii)
iv)
Contract revenue recognised for the financial year [Note (K)]
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
Amount of customer advances outstanding for contracts in progress as at end of the financial
year
Retention amounts by customers for contracts in progress as at end of the financial year
2012-13
2011-12
crore
crore
52618.63
153205.39
45356.71
118453.74
7985.16
9250.11
6974.96
4973.43
b) Disclosures pursuant to Guidance Note on Accounting for Real Estate Transactions (Revised 2012) issued by the Institute of
Chartered Accountants of India, adopted by the Company with effect from April 1, 2012.
Particulars
i)
ii)
Amount of project revenue recognised for the financial year [Note (K)]
Aggregate amount of costs incurred and profits recognised (Less recognised losses) as at the end of the
financial year
iii) Amount of advances received
iv) Amount of work in progress and the value of inventories [Note H(II)]
v)
Excess of revenue recognised over actual bills raised (unbilled revenue) [Note H(VI)]
Q(7) Disclosures pursuant to Accounting Standard (AS) 13 “Accounting for Investments”
2012-13
crore
73.79
70.24
158.32
149.76
1.83
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 company L&T Transportation Infrastructure Limited (LTTIL):
i.
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
1.
182
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
ii.
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.
To the lenders of L&T Krishnagiri Thopur Toll Road Limited, not to dilute Company’s shareholding in L&T Infrastructure
Development Projects Limited below 51%.
c.
To Gujarat State Road Development Corporation Limited:
i.
to hold in L&T Ahmedabad-Maliya Tollway Limited, L&T Halol-Shamlaji Tollway Limited and L&T Rajkot-Vadinar Tollway
Limited along with L&T Infrastructure Development Projects Limited:
100% stake during the construction period;
51% stake for 5 years from the date of commercial operation or end of construction of the project, whichever
is later; and
51% stake during operational period.
ii.
not to divest the stake in L&T Infrastructure Development Projects Limited until the aforesaid undertakings are valid.
d.
e.
f.
To National Highway Authority of India, to hold together with its associates in L&T Samakhiali Gandhidham Tollway Limited
minimum 51% stake for a period of 2 years after the construction period.
To National Highway Authority of India, to hold minimum 26% stake in PNG Tollway Limited till the commercial operations
date.
To National Highway Authority of India, to hold together with its associates, in L&T Devihalli Hassan Tollway Limited,
minimum 51% stake for a period of 2 years after construction period.
g.
To National Highway Authority of India, to hold together with its associates in L&T Krishnagiri Walajahpet Tollway Limited:
i. minimum 51% stake during the construction period
ii. minimum 33% stake for 3 years from project completion date and
iii. Minimum 26% or such lower stake as may be permitted by National Highway Authority of India during remaining
concession period.
h.
i.
j.
k.
l.
To the lenders of PNG Tollway Limited, to hold together with L&T Infrastructure Development Projects Limited and Ashoka
Buildcon Limited, minimum 51% stake in PNG Tollway Limited, until final settlement date.
To the Security Trustee of the lenders of L&T Metro Rail (Hyderabad) Limited, to hold and maintain along with L&T
Infrastructure Development Projects Limited (a subsidiary of the Company) at least 51% stake till final settlement date.
To the Government of Andhra Pradesh (GoA) with respect to shareholding in L&T Metro Rail (Hyderabad) Limited, to hold
and maintain along with L&T Infrastructure Development Projects Limited –
i.
ii.
51% stake till the second anniversary of the commercial operation date (COD) of the project;
33% stake till the third anniversary of the commercial operation date of the project;
iii. 26% stake (or such lower proportion as may be permitted by the GoA), till the remaining concession period.
Jointly with L&T-MHI Turbine Generators Private Limited (a subsidiary of the Company) and Mitsubishi Heavy Industries
Limited (joint venture 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.
To hold certain minimum stake in its subsidiary companies namely, L&T–MHI Boilers Private Limited and L&T–MHI Turbine
Generators Private Limited. These undertakings have been given to the customers/potential customers of the Company, as
also those of L&T–MHI Boilers Private Limited. The undertakings will remain valid till the end of defect liability period or till
such period as prescribed in the related bid documents/contracts.
m. To the Security Trustee of the lenders of L&T Sapura Shipping Private Limited, not to sell or transfer equity stake without
prior approval.
n.
o.
p.
To hold 15,899 shares comprising 9.85% of the issued capital of International Seaport Dredging Limited till January 24,
2016.
To the Security Trustee of L&T Aviation Services Private Limited, to hold at least 51% stake, directly or indirectly, in L&T
Aviation Services Private Limited, until any amount is outstanding under the Credit Facility Agreement.
To City and Industrial Development Corporation of Maharashtra Limited (CIDCO) that it shall continue to hold not less than
51% stake in L&T Seawoods Private Limited (LTSPL) until CIDCO executes the lease deed for land in favour of LTSPL.
183
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
q.
r.
To the lenders of L&T Seawoods Private Limited, to maintain a minimum 51% stake in L&T Seawoods Private Limited, until
any amount is outstanding under banking credit facilities.
To the debenture trustee of L&T Shipbuilding Limited, to maintain at least 26% stake in L&T Shipbuilding Limited, until any
amount is outstanding under the debentures.
Q(8) Disclosure pursuant to Accounting Standard (AS) 15 (Revised) “Employee Benefits”.
i.
Defined contribution plans: [Note R(6)(b)(i)] Amount of 103.80 crore [including 17.17 crore in respect of earlier years] (previous
year: 74.52 crore) is recognised as an expense and included in “employee benefits expense” (Note N) in the Statement of Profit
and Loss.
ii. Defined benefit plans: [Note R(6)(b)(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
As at
31-3-2013
As at
31-3-2012
As at
31-3-2013
As at
31-3-2012
As at
31-3-2013
As at
31-3-2012
As at
31-3-2013
As at
31-3-2012
crore
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
Liabilities
Assets
Net liability/(asset)
Net liability/(asset) - current
Net liability/(asset) - non-current
363.34
1.11
364.45
311.80
–
52.65
52.65
–
52.65
52.65
–
340.22
0.85
341.07
291.66
–
49.41
49.41
–
49.41
49.41
–
–
106.56
106.56
–
1.25
105.31
105.31
–
105.31
5.77
99.54
–
88.44
88.44
–
1.43
87.01
87.01
–
87.01
4.83
82.18
–
198.89
198.89
–
0.53
198.36
198.36
–
198.36
11.98
186.38
b)
The amounts recognised in Statement of Profit and Loss are as follows:
– 1665.13
184.67
10.81
184.67 1675.94
– 1648.23
–
27.71
0.64
184.03
1526.04
18.68
1544.72
1507.47
–
37.25
184.03
–
184.03
9.84
174.19
37.32
27.72
–
–
27.72
37.32
27.72 # 18.64 #
18.68
–
crore
Particulars
Gratuity plan
Post-retirement medical
benefit plan
Company pension plan
Trust-managed provident
fund plan
1
2
3
4
5
6
Current service cost
Interest cost
Expected (return) on plan assets
Actuarial losses/(gains)
Past service cost
Actuarial gain/(loss) not recognised in
books
Total (1 to 6)
I
Amount included in “employee benefits
expense”
Amount included as part of finance costs
Amount capitalised on new product
development
Amount recovered from S&A Companies
II
III
IV
Total (I + II+III+IV)
Actual return on plan assets
2012-13
19.36
28.57
(21.13)
25.43
–
2011-12
24.25
24.90
(20.80)
21.08
–
2012-13
6.07
7.91
–
9.33
0.18
2011-12
5.95
7.75
–
(13.26)
0.18
2012-13
0.98
15.45
–
9.14
0.11
2011-12
2012-13
2011-12
5.12 102.80 $ 79.67 $
110.70
13.27 114.60
(110.70)
– (114.60)
11.57
(15.99)
–
–
12.54
0.11
–
52.23
44.97
6.61
0.08
0.57
52.23
34.55
–
49.43
53.38
(5.56)
–
1.61
49.43
20.70
–
23.49
7.82
15.67
–
–
23.49
–
–
0.62
0.06
0.56
–
–
0.62
–
–
25.68
0.82
25.95
–
(1.09)
25.68
–
–
31.04
(0.08)
86.73
7.11
98.35
27.12 102.80
(16.07)
2.59
79.67
18.68
–
1.33
31.04
–
–
86.73
– 122.72
–
–
98.35
117.81
184
Notes forming part of the Accounts (contd.)
NOTE [Q] (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)
ii)
iii)
Employer
Employee
Transfer-in/(out)~
Add/(less): Actuarial losses/(gains)
Less: Benefits paid
Add: Past service cost
Closing balance of the present value of
defined benefit obligation
Gratuity plan
As at
31-3-2013
As at
31-3-2012
Post-retirement medical
benefit plan
As at
31-3-2013
As at
31-3-2012
Company pension plan
crore
Trust-managed
provident fund plan
As at
31-3-2013
As at
31-3-2012
As at
31-3-2013
As at
31-3-2012
341.07
19.36
28.57
–
–
–
38.85
(63.40)
–
336.33
24.25
24.90
–
–
(2.03)
20.98
(63.36)
–
88.44
6.07
7.91
–
–
–
9.33
(5.19)
–
92.92
5.95
7.75
–
–
–
(13.26)
(4.92)
–
184.67
0.98
15.45
–
–
–
9.14
(11.35)
–
162.89 1544.72
1396.21
5.12 102.80 $ 79.67 $
13.27 114.60
110.70
–
–
– 175.46
–
–
12.54
(7.87)
(9.15) (253.77)
–
–
–
150.63
–
18.68
(211.17)
–
364.45
341.07
106.56
88.44
198.89
184.67 1675.94
1544.72
d) Changes in the fair value of plan assets representing reconciliation of the opening and closing balances thereof are as
follows:
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
Closing balance of the plan assets
Gratuity plan
crore
Trust-managed
provident fund plan
As at
31-3-2013
291.66
21.13
13.42
48.99
–
(63.40)
311.80
As at
31-3-2012
308.38
20.80
(0.10)
25.94
–
(63.36)
291.66
As at
31-3-2013
1507.47
114.60
8.12
97.12
174.69
(253.77)
1648.23
As at
31-3-2012
1369.08
110.70
7.11
83.29
148.46
(211.17)
1507.47
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 funds. 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. Note Q(8)(ii)(f)(7).
The Company expects to fund
(previous year: 84.45 crore) towards its trust-managed provident fund plan during the year 2013-14.
51.53 crore (previous year: 48.56 crore) towards its gratuity plan and
108.96 crore
#
$
~
Employer’s and employees’ contribution (net) for March is paid in April.
Employer’s contribution to provident fund
Amount transferred (to)/from subsidiary & associate companies and transferred out on sale of business undertakings (net)
Nil crore [previous year (2.03) crore]
185
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
e)
The major categories of plan assets as a percentage of total plan assets are as follows:
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
Gratuity plan
As at
31-3-2013
29%
15%
26%
2%
As at
31-3-2012
35%
10%
16%
3%
Trust-managed provident
fund plan
As at
31-3-2013
24%
13%
7%
–
As at
31-3-2012
24%
12%
7%
–
–
1%
20%
7%
–
1%
29%
6%
14%
–
42%
–
17%
–
40%
–
f)
Principal actuarial assumptions at the Balance Sheet date (expressed as weighted averages):
1
2
3
4
Post-retirement medical benefit plan
Discount rate:
a) Gratuity plan
b) Company pension plan
c)
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
31-3-2013
As at
31-3-2012
8.09%
8.09%
8.09%
7.50%
5.00%
5.00%
6.00%
8.59%
8.59%
8.59%
7.50%
5.00%
5.00%
6.00%
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 6% (previous year: 1% to 6%) 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 Statement of Profit and Loss 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:
crore
Particulars
Effect of 1% increase
Effect of 1% decrease
2012-13
2011-12
2012-13
2011-12
Effect on the aggregate of the service cost and
interest cost
Effect on defined benefit obligation
2.73
11.11
2.15
8.74
(2.10)
(8.84)
(1.67)
(7.02)
186
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
g)
The amounts pertaining to defined benefit plans are as follows:
Particulars
As at
31-3-2013
As at
31-3-2012
As at
31-3-2011
As at
31-3-2010
As at
31-3-2009
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)
105.31
1.62
364.45
311.80
(52.65)
26.26
13.01
87.01
(6.60)
91.31
7.91
78.99
5.73
70.97
1.13
341.07
291.66
(49.41)
30.52
(0.45)
336.33
308.38
(27.95)
30.00
4.48
320.41
279.30
(41.11)
30.67
2.21
272.93
244.71
(28.22)
8.38
13.13
Defined benefit obligation
198.36
184.03
162.14
135.61
151.80
Experience adjustment plan liabilities
(2.79)
23.21
17.46
(4.11)
(6.89)
4
Trust managed provident fund plan (funded/unfunded)
Defined benefit obligation
1675.94
1544.72
1396.21
1199.77
1001.10
Plan assets
Surplus/(deficit)
1648.23
1507.47
1369.08
1186.01
1017.06
(27.71)
(37.25)
(27.13)
(13.76)
15.96
h) General descriptions of defined benefit plans:
1. Gratuity plan:
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 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.
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 Statement of Profit and Loss as actuarial loss. Any loss/gain arising out of the investment
187
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
risk and actuarial risk associated with the plan is also recognised as expense or income in the period in which such
loss/gain occurs. Further, the provision of 18.68 crore, which was created in 2011-12 based on actuarial valuation
towards the future obligation arising out of interest rate guarantee associated with the plan, has been reversed in
the current year, because the balance in surplus account of the fund is higher than the interest obligation of 10.81
crore as on March 31, 2013.
Q(9) Disclosures pursuant to Accounting Standard (AS) 17 “Segment Reporting”
a)
Information about business segments (information provided in respect of revenue items for the year ended March 31, 2013 and
in respect of assets/liabilities as at March 31, 2013 denoted as “CY” below, previous year denoted as “PY”)
i)
Primary segments (business segments):
crore
Particulars
Engineering &
construction
CY
PY
Electrical &
electronics
CY
PY
Machinery &
industrial products
PY
CY
Others
Elimination
Total
CY
PY
CY
PY
CY
PY
Revenue – including excise duty
External
Inter-segment
Total revenue
Result
Segment result
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
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, amortisation and
obsolescence (included in
segment expense)
Non-cash expenses other than
depreciation included in
segment expense
188
54378.29 47067.97 3403.12
240.83
210.73
54500.97 47278.70 3643.95
122.68
3250.54 2302.72
328.89
92.47
3579.43 2395.19
2474.72 1386.73
27.12
2553.94 1413.85
79.22
944.55
–
18.47 (483.10)
963.02 (483.10)
– 61470.86 53737.78
(637.31)
–
–
(637.31) 61470.86 53737.78
5598.17
5440.78
358.00
364.21
403.35
443.42
422.62
190.33
–
– 6782.14
6438.74
(17.52)
6764.62
(25.42)
6413.32
(5.83)
318.13
6407.49
7082.75
(666.10)
(982.40)
568.94
532.69
6633.04
6310.33
(1658.21) (1814.13)
(39.70)
(135.79)
4456.50
4839.04
71.61
4910.65
–
4456.50
49249.83 43958.12
22924.38 23674.28
72174.21 67632.40
31551.15 30486.45
11480.34 11922.93
43031.49 42409.38
44159.07 39287.44 2434.57
2460.91 1355.09
1312.58 1301.10
897.19
29187.69 28307.30 1153.48
1097.46
759.08
784.45
450.90
297.24
845.67
628.29
1213.31
538.60
184.06
74.68
170.45
65.91
49.07
27.73
24.51
26.24
142.60
32.60
101.88
20.81
105.76
156.98
5.63
8.41
1.96
5.97
8.33
12.88
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
ii)
Secondary segments (geographical segments):
crore
Particulars
External revenue by location of customers
Carrying amount of segment assets by location
of assets
Domestic
Overseas
CY
PY
CY
49272.75 47308.33 12198.11
6284.66
42965.17 39931.64
PY
PY
6429.45 61470.86 53737.78
4026.48 49249.83 43958.12
Total
CY
Cost incurred on acquisition of tangible and
1082.20
1447.34
139.20
62.81
1221.40
1510.15
intangible fixed assets
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. 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.
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”
issued by the Institute of Chartered Accountants of India.
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 components,
custom built low and medium voltage switchboards, electronic energy meters/protection (relays) systems, control &
automation products and medical equipment (upto the date of sale).
Machinery & industrial products segment comprises manufacture and sale of rubber processing machinery and
castings, manufacture and marketing of industrial valves, construction equipment and industrial products. Machinery
& Industrial Products also include marketing of welding products in the previous year.
Others include property development and integrated engineering services.
Q(10) Disclosure of related parties/related party transactions pursuant to Accounting Standard (AS) 18 “Related Party Disclosures”
i.
List of related parties over which control exists and status of transactions entered during the year
Sr.
No.
1
2
3
4
5
6
7
8
9
10
11
12
Name of the related party
Relationship
Tractor Engineers Limited
Bhilai Power Supply Company Limited
L&T-Sargent & Lundy Limited
Spectrum Infotech Private Limited
L&T-Valdel Engineering Limited
L&T Shipbuilding Limited
L&T Electricals and Automation Limited
Hi-Tech Rock Products & Aggregates Limited
L&T Seawoods Private Limited
L&T-Gulf Private Limited
L&T-MHI Boilers Private Limited
L&T-MHI Turbine Generators Private Limited
Wholly owned Subsidiary
Subsidiary*
Subsidiary*
Wholly owned Subsidiary
Wholly owned Subsidiary
Subsidiary*
Wholly owned Subsidiary
Wholly owned Subsidiary
Wholly owned Subsidiary
Subsidiary*
Subsidiary*
Subsidiary*
Transaction
entered during
the year (Yes/No)
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
189
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Name of the related party
Relationship
Sr.
No.
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
Raykal Aluminium Company Private Limited
L&T Natural Resources Limited
L&T Plastics Machinery Limited @
L&T Technologies Limited
L&T Special Steels and Heavy Forgings Private Limited
PNG Tollway Limited
L&T Rajkot-Vadinar Tollway Limited
Kesun Iron & Steel Company Private Limited
L&T Howden Private Limited
L&T Solar Limited
L&T Sapura Shipping Private Limited
L&T Sapura Offshore Private Limited
L&T PowerGen Limited
Ewac Alloys Limited
L&T Kobelco Machinery Private Limited
L&T Realty Limited
L&T Asian Realty Project LLP
L&T Parel Project LLP
Chennai Vision Developers Private Limited
L&T Urban Infrastructure Limited
L&T South City Projects Limited
L&T Siruseri Property Developers Limited
L&T Vision Ventures Limited
L&T Tech Park Limited
L&T Bangalore Airport Hotel Limited
CSJ Infrastructure Private Limited
L&T Commercial Projects Private Limited
(formerly known as L&T Arun Excello Commercial
Projects Private Limited) @@
L&T Chennai Projects Private Limited (formerly known as
L&T Arun Excello IT SEZ Private Limited)
L&T Power Limited
L&T Cassidian Limited
L&T General Insurance Company Limited
L&T Aviation Services Private Limited
L&T Infocity Limited
L&T Hitech City Limited
Hyderabad International Trade Expositions Limited
Larsen & Toubro Infotech Limited
GDA Technologies Limited
L&T Finance Holdings Limited
L&T Finance Limited
L&T Investment Management Limited
L&T Mutual Fund Trustee Limited
L&T FinCorp Limited
L&T Infrastructure Finance Company Limited
L&T Infra Investment Partners Advisory Private Limited
L&T Infra Investment Partners Trustee Private Limited
L&T Unnati Finance Limited
L&T Access Financial Advisory Services Limited
(formerly known as L&T Access Financial Advisory
Services Private Limited)
L&T Capital Company Limited
L&T Trustee Company Private Limited
190
Subsidiary*
Wholly owned Subsidiary
Wholly owned Subsidiary
Wholly owned Subsidiary
Subsidiary*
Subsidiary***
Subsidiary of L&T Infrastructure Development Projects Limited #
Subsidiary*
Subsidiary*
Wholly owned Subsidiary
Subsidiary*
Subsidiary*
Wholly owned Subsidiary
Wholly owned Subsidiary
Subsidiary*
Wholly owned Subsidiary
Subsidiary of L&T Realty Limited #
Subsidiary of L&T Realty Limited
Wholly owned Subsidiary of L&T Realty Limited
Wholly owned Subsidiary of L&T Realty Limited
Subsidiary of L&T Urban Infrastructure Limited #
Wholly owned Subsidiary of L&T South City Projects Limited
Subsidiary of L&T Urban Infrastructure 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 L&T Urban Infrastructure Limited
Transaction
entered during
the year (Yes/No)
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Wholly owned Subsidiary of L&T Urban Infrastructure Limited
Subsidiary*
Subsidiary*
Wholly owned Subsidiary
Wholly owned Subsidiary
Subsidiary*
Subsidiary of L&T Infocity Limited #
Subsidiary of L&T Infocity Limited #
Wholly owned Subsidiary
Subsidiary of GDA Technologies Inc.#
Subsidiary*
Wholly owned Subsidiary of L&T Finance Holdings Limited
Wholly owned Subsidiary of L&T Finance Holdings Limited
Wholly owned Subsidiary of L&T Finance Holdings Limited
Wholly owned Subsidiary of L&T Finance Holdings Limited
Wholly owned Subsidiary of L&T Finance Holdings Limited
Wholly owned Subsidiary of L&T Infrastructure Finance Company Limited
Wholly owned Subsidiary of L&T Infrastructure Finance Company Limited
Wholly owned Subsidiary of L&T Finance Holdings Limited
Wholly owned Subsidiary of L&T Finance Holdings Limited
Wholly owned Subsidiary
Wholly owned Subsidiary of L&T Capital Company Limited
Yes
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
No
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
No
Yes
Yes
No
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Sr.
No.
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
Name of the related party
Relationship
L&T Power Development Limited
L&T Uttaranchal Hydropower Limited
L&T Arunachal Hydropower Limited
L&T Himachal Hydropower Limited
Nabha Power Limited
L&T Infrastructure Development Projects Limited
L&T Panipat Elevated Corridor Limited
Narmada Infrastructure Construction Enterprise Limited
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 Port Kachchigarh Limited
L&T Ahmedabad-Maliya Tollway Limited
L&T Halol-Shamlaji Tollway Limited
L&T Krishnagiri Walajahpet Tollway Limited
L&T Devihalli Hassan Tollway Limited
L&T Metro Rail (Hyderabad) Limited
L&T Transco Private Limited
L&T Chennai–Tada Tollway Limited
L&T BPP Tollway Limited
L&T Deccan Tollways Limited
L&T Samakhiali Gandhidham Tollway Limited
Larsen & Toubro LLC
Larsen & Toubro Infotech GmbH
Larsen & Toubro Infotech Canada Limited
Larsen & Toubro Infotech LLC
L&T Infotech Financial Services Technologies Inc.
GDA Technologies Inc.
L&T Infrastructure Development Projects Lanka
(Private) Limited
Wholly owned Subsidiary
Wholly owned Subsidiary of L&T Power Development Limited
Wholly owned Subsidiary of L&T Power Development Limited
Wholly owned Subsidiary of L&T Power Development Limited
Wholly owned Subsidiary of L&T Power Development Limited
Subsidiary*
Wholly owned Subsidiary of L&T Infrastructure Development Projects Limited
Subsidiary of L&T Western India Tollbridge 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
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
Subsidiary of L&T Infrastructure Development Projects Limited
Subsidiary of L&T Infrastructure Development Projects Limited
Subsidiary of L&T Infrastructure Development Projects Limited
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
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
Subsidiary of L&T Infrastructure Development Projects Limited#
Subsidiary*
Wholly owned Subsidiary of Larsen & Toubro Infotech Limited
Wholly owned Subsidiary of Larsen & Toubro Infotech Limited
Wholly owned Subsidiary of Larsen & Toubro Infotech Limited
Wholly owned Subsidiary of Larsen & Toubro Infotech Limited
Wholly owned Subsidiary of Larsen & Toubro Infotech Limited
Subsidiary of L&T Infrastructure Development Projects Limited #
95
Peacock Investments Limited
96 Mango Investments Limited
97
98
Lotus Infrastructure Investments Limited
L&T Diversified India Equity Fund (formerly known as
L&T Real Estate India Fund)
L&T Asset Management Company Limited
L&T Realty FZE
Larsen & Toubro International FZE
Larsen & Toubro (Oman) LLC
Larsen & Toubro Electromech LLC
L&T Modular Fabrication Yard LLC
Larsen & Toubro (East Asia) SDN.BHD
Larsen & Toubro Qatar LLC
L&T Overseas Projects Nigeria Limited
L&T Electricals & Automation Saudi Arabia Company LLC
(formerly known as L&T Electricals Saudi Arabia
Company LLC)
Larsen & Toubro Kuwait Construction General
Contracting Company, WLL
99
100
101
102
103
104
105
106
107
108
109
Wholly owned Subsidiary of L&T Capital Company Limited
Wholly owned Subsidiary of L&T Capital Company Limited
Wholly owned Subsidiary of L&T Capital Company Limited
Wholly owned Subsidiary of L&T Capital Company Limited
Wholly owned Subsidiary of L&T Capital Company Limited
Wholly owned Subsidiary of L&T Realty Limited
Wholly owned Subsidiary
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 Larsen & Toubro International FZE ##
Subsidiary of Larsen & Toubro International FZE#
Subsidiary of Larsen & Toubro International FZE #
Subsidiary of Larsen & Toubro International FZE ##
Transaction
entered during
the year (Yes/No)
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
No
No
No
Yes
No
No
No
No
No
No
No
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
191
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Name of the related party
Relationship
Sr.
No.
110
111
113
114
115
116
117
118
119
120
121
122
123
124
125
126
127
128
129
130
131
132
133
134
135
136
137
138
139
140
141
Larsen & Toubro (Qingdao) Rubber Machinery
Company Limited
Qingdao Larsen & Toubro Trading Company Limited
112
Jiangsu Shengye Valve Co., Ltd.
(formerly known as 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
Tamco Switchgear (Malaysia) SDN. BHD
Tamco Electrical Industries Australia Pty Ltd
PT Tamco Indonesia
Larsen & Toubro Heavy Engineering LLC
L&T Electrical & Automation FZE
Larsen & Toubro Consultoria E Projeto Ltda
Larsen & Toubro T&D SA (Proprietary) Limited
L&T East-West Tollway Limited
L&T Great Eastern Highway Limited
Servowatch Inc $
Servowatch Systems Limited
L&T Geostructure LLP
Larsen Toubro Arabia LLC
Henikwon Corporation SDN.BHD
L&T Housing Finance Limited
L&T Tejomaya Limited
Audco India Limited **
L&T Technology Services Limited (originally formed as
L&T Technology And Engineering Services Company
Limited and name changed subsequently)
CSJ Hotels Private Limited
Consumer Financial Services Limited
Family Credit Limited
L&T Capital Markets Limited
L&T Infra Debt Fund Limited
L&T Trustee Services Private Limited (formerly known as
FIL Trustee Company Private Limited)
L&T Fund Management Private Limited (formerly known
as FIL Fund Management Private Limited)
Larsen & Toubro Infotech South Africa (PTY) Limited
Thalest Limited
Bond Instrumentation & Process Control Limited
Wholly owned Subsidiary of Larsen & Toubro International FZE
Wholly owned Subsidiary of Larsen & Toubro (Qingdao) Rubber
Machinery Company Limited
Wholly owned Subsidiary of Larsen & Toubro International FZE
Subsidiary of Larsen & Toubro International FZE ##
Subsidiary of Larsen & Toubro International FZE#
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
Subsidiary of Larsen & Toubro International FZE #
Wholly owned Subsidiary of Larsen & Toubro International FZE
Subsidiary of Larsen & Toubro International FZE
Subsidiary of Larsen & Toubro International FZE #
Wholly owned Subsidiary of L&T Infrastructure Development Projects Limited
Wholly owned Subsidiary of L&T Infrastructure Development Projects Limited
Wholly owned Subsidiary of Thalest Limited
Wholly owned Subsidiary of Thalest Limited
Subsidiary*
Subsidiary*
Wholly owned Subsidiary of Tamco Switchgear (Malaysia) SDN. BHD
Wholly owned Subsidiary of L&T Finance Holdings Limited
Wholly owned subsidiary of L&T Tech Park Limited
Wholly owned Subsidiary
Wholly owned Subsidiary
Wholly owned Subsidiary of CSJ Infrastructure Private Limited
Wholly owned Subsidiary of L&T Housing Finance Limited
Wholly owned Subsidiary of L&T Finance Holdings Limited
Wholly owned Subsidiary of L&T Finance Holdings Limited
Wholly owned Subsidiary of L&T Finance Holdings Limited
Wholly owned Subsidiary of L&T Mutual Fund Trustee Limited
Wholly owned Subsidiary of L&T Investment Management Limited
Transaction
entered during
the year (Yes/No)
Yes
No
Yes
Yes
Yes
No
Yes
Yes
No
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
No
No
No
No
No
No
No
No
No
Subsidiary of Larsen & Toubro Infotech Limited#
Wholly owned Subsidiary of Larsen & Toubro International FZE
Wholly owned Subsidiary of Thalest Limited
142
143
144
*
@
#
**
***
@@
##
@@@ The Company’s subsidiary has sold 75% stake on September 4, 2012
@@@@ The Company’s subsidiary has sold its stake on July 18, 2012
$
The Company holds more than one-half in nominal value of the equity share capital
The Company has sold its stake on September 28, 2012
The Company’s subsidiary/wholly owned subsidiary holds more than one-half in nominal value of the equity share capital
Associate became a wholly owned subsidiary w.e.f. March 28, 2013
The Company, together with its subsidiaries holds more than one-half in nominal value of the equity share capital
The Company’s subsidiary has sold its stake on November 26, 2012
The Company, together with its subsidiaries controls the composition of the Board of Directors.
The Company was acquired during the year and has been dissolved w.e.f. February 28, 2013
192
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
ii
(a) Names of the associates and joint ventures with whom transactions were carried out during the year:
Associate companies:
Audco India Limited ***
L&T-Chiyoda Limited
2
4
Salzer Electronics Limited
L&T-Komatsu Limited
L&T-Ramboll Consulting Engineers Limited
6 Magtorq Private Limited
1
3
5
7
3
5
7
JSK Electricals Private Limited
Joint ventures (other than associates):
1 Metro Tunneling Group
Desbuild L&T Joint Venture
L&T-AM Tapovan Joint Venture
8
2
4
6
AIC Structural Steel Construction (India) Private Limited
L&T Hochtief Seabird Joint Venture
L&T-Shanghai Urban Construction (Group) Corporation
Joint Venture
HCC-L&T Purulia Joint Venture
The Dhamra Port Company Limited
8 Metro Tunneling Delhi-L&T SUCG Joint Venture
9 Metro Tunneling Chennai L&T SUCG Joint Venture 10
L&T-Eastern Joint Venture
11
L&T-Shapoorji Pallonji & Co. Ltd.
12
L&T-Shanghai Urban Construction (Group)
Joint Venture-TCS
Joint Venture CC27 Delhi ****
13
International Metro Civil Contractors
*** Associate became wholly owned subsidiary w.e.f. March 28, 2013
**** The joint venture has been entered into on November 5, 2012. Funds yet to be infused in the joint venture.
ii
(b) Names of the Key management personnel and their relatives with whom transactions were carried out during the year:
Key management personnel & their relatives:
1 Mr. A.M. Naik (Group Executive Chairman)
2 Mr. K. Venkataramanan (CEO & Managing Director)
Mrs. Jyothi Venkataramanan (wife)
3 Mr. V. K. Magapu (Whole-time director)*
4 Mr. M. V. Kotwal (Whole-time director)
5 Mr. S. N. Subrahmanyan (Whole-time Director )
6 Mr. R. Shankar Raman (CFO & Whole-time Director)
7 Mr. S. N. Roy (Whole-time Director )
8 Mr. Ravi Uppal (Whole-time director)**
* Retired w.e.f. the close of working hours of September 30, 2012
** Ceased to be director w.e.f the close of working hours of September 15, 2012
iii. Disclosure of related party transactions:
Nature of transaction/relationship/major parties
Sr.
no.
Amount Amounts for
major parties
Amount Amounts for
major parties
1 Purchase of goods & services (including commission paid)
Subsidiaries, including:
4961.52
3384.26
2012-13
2011-12
crore
L&T-MHI Boilers Private Limited
L&T-MHI Turbine Generators Private Limited
Associates & joint ventures, including:
830.56
Audco India Limited
Salzer Electronics Limited
2023.78
1205.39
587.68
118.75
746.39
Total
5792.08
4130.65
1438.86
1224.75
493.83
106.44
193
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Nature of transaction/relationship/major parties
Sr.
no.
2 Sale of goods/contract revenue & services
Subsidiaries, including:
L&T Shipbuilding Limited
Nabha Power Limited
Associates & joint ventures, including:
The Dhamra Port Company Limited
Total
3 Purchase/lease of fixed assets
Subsidiaries, including:
L&T Shipbuilding Limited
Larsen & Toubro International FZE
Ewac Alloys Limited
Associate:
L&T-Komatsu Limited
Total
4 Sale of fixed assets
Subsidiaries, including:
L&T Special Steels and Heavy Forgings Private Limited
L&T-MHI Turbine Generators Private Limited
L&T-MHI Boilers Private Limited
PT Tamco Indonesia
L&T Plastics Machinery Limited
2012-13
2011-12
Amount Amounts for
major parties
Amount Amounts for
major parties
crore
7112.83
5928.13
45.84
–
2390.13
43.17
100.68
692.60
2069.94
99.97
7158.67
6028.81
34.65
41.20
3.76
38.41
0.54
14.83
11.55
7.57
3.76
0.40
0.13
1.74
42.94
65.59
Total
0.54
65.59
5 Subscription to equity and preference shares (including
application money paid and Investment in joint ventures)
Subsidiaries, including:
1486.19
1651.29
L&T Infrastructure Development Projects Limited
L&T Power Development Limited
L&T Shipbuilding Limited
Associates & joint ventures, including:
L&T-AM Tapovan Joint Venture
Metro Tunneling Chennai L&T SUCG Joint Venture
Total
6 Purchase of investments from
Subsidiaries:
41.72
437.00
818.63
11.69
28.41
86.00
1527.91
1737.29
25.57
906.19
L&T Infrastructure Development Projects Limited
L&T Capital Company Limited
–
25.57
Total
25.57
906.19
194
24.68
–
10.38
1.74
26.41
19.61
13.45
–
–
1339.66
–
–
71.33
–
16.02
890.17
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Nature of transaction/relationship/major parties
Sr.
no.
Amount Amounts for
major parties
Amount Amounts for
major parties
2012-13
2011-12
crore
7 Sale of investments to
Subsidiaries:
L&T Infrastructure Development Projects Limited
L&T Capital Company Limited
Total
8 Buy back of shares by
Subsidiary:
L&T-Sargent & Lundy Limited
Total
9 Capital reduction by
Subsidiary:
L&T Power Limited
Total
10 Receiving of services from:
Subsidiaries, including:
Larsen & Toubro Infotech Limited
L&T Aviation Services Private Limited
Associates & joint ventures, including:
L&T-Chiyoda Limited
Total
11 Rent paid, including lease rentals under leasing/hire purchase
arrangements
Subsidiaries, including:
L&T Finance Limited
L&T Infocity Limited
Larsen & Toubro Infotech Limited
Larsen and Toubro Kuwait Construction General
Contracting Company, WLL
Associates:
Audco India Limited
L&T-Komatsu Limited
Key management personnel
Total
12 Charges for deputation of employees to related parties
Subsidiaries, including:
L&T Power Development Limited
L&T-Valdel Engineering Limited
L&T Parel Project LLP
Associates & joint ventures, including:
L&T-Chiyoda Limited
Audco India Limited
L&T-Komatsu Limited
–
–
7.50
7.50
153.42
153.42
89.35
6.65
96.00
2.48
2.01
0.01
4.50
57.18
58.21
–
–
7.50
153.42
33.10
27.14
6.48
–
1.29
0.57
0.36
0.66
1.35
10.19
11.66
8.52
35.24
16.31
5.93
Total
115.39
113.66
958.71
958.71
68.97
889.74
2.40
2.40
–
–
71.16
3.57
74.73
4.29
0.86
0.02
5.17
58.83
54.83
2.40
–
39.55
18.15
3.57
2.84
1.26
–
–
–
0.86
10.30
9.44
–
29.61
13.86
7.52
195
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Nature of transaction/relationship/major parties
Sr.
no.
13 Dividend received ^^
Subsidiaries, including:
Larsen & Toubro Infotech Limited
L&T Infocity Limited
Ewac Alloys Limited
Audco India Limited
Associates:
L&T-Komatsu Limited
L&T- Ramboll Consulting Engineers Limited
Audco India Limited
2012-13
2011-12
Amount Amounts for
major parties
Amount Amounts for
major parties
crore
583.21
385.13
303.15
134.57
59.64
50.03^^
1.80
22.58
–
1.80
–
Total
585.01
407.71
^^ Out of total dividend of
50.02
crore has been credited to investment account being in the
nature of dividend out of pre-acquisition profits.
14 Commission received, including those under agency
100.05 crore declared,
arrangements
Subsidiaries:
Larsen & Toubro (Qingdao) Rubber Machinery
Company Limited
L&T Kobelco Machinery Private Limited
Tractor Engineers Limited
Associate:
L&T-Komatsu Limited
Total
15 Rent received, overheads recovered and miscellaneous income
Subsidiaries, including:
Larsen & Toubro Infotech Limited
Larsen & Toubro (Oman) LLC
L&T-MHI Boilers Private Limited
Associates & joint ventures, including:
Audco India Limited
L&T-Chiyoda Limited
Total
16 Interest received from
Subsidiaries, including:
L&T Chennai Projects Private Limited
(formerly L&T Arun Excello IT SEZ Private Limited)
L&T Realty Limited
L&T Urban Infrastructure Limited
L&T Infrastructure Finance Company Limited
L&T Infrastructure Development Projects Limited
L&T Uttaranchal Hydropower Limited
L&T Shipbuilding Limited
L&T Finance Holdings Limited
Joint venture:
The Dhamra Port Company Limited
Key management personnel
Total
0.96
2.23
0.38
0.48
0.10
138.68
80.31
40.87
52.18
–
3.55
18.99
64.31
25.40
–
–
–
–
–
41.62
138.68
139.64
310.96
6.01
316.97
139.65
41.62
–
181.27
187.96
190.19
275.82
5.61
281.43
131.41
26.99
0.01
158.41
196
254.78
115.34
–
–
13.20
–
9.38
2.23
–
–
187.96
74.60
43.01
48.59
0.70
4.23
16.58
–
–
36.09
13.29
14.95
14.46
14.37
26.99
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Nature of transaction/relationship/major parties
Sr.
no.
Amount Amounts for
major parties
Amount Amounts for
major parties
2012-13
2011-12
crore
27.35
18.48
17 Interest paid to
Subsidiaries, including:
L&T Finance Limited
L&T-MHI Boilers Private Limited
L&T Transportation Infrastructure Limited
L&T Infrastructure Development Projects Limited
Associate:
Audco India Limited
Total
18 Transfer of Business to:
Subsidiary:
Ewac Alloys Limited
Total
–
27.35
–
–
19 Payment of salaries/perquisites (Other than commission)
21.72
Key management personnel:
A. M. Naik
Y. M. Deosthalee ^^^
K. Venkataramanan
K. V. Rangaswami
V. K. Magapu * ^^^^
M. V. Kotwal
Ravi Uppal **^^
S. N. Subrahmanyan
R. Shankar Raman
S. N. Roy
Total
20 Commission to directors @
Key management personnel :
A. M. Naik
Y. M. Deosthalee
K. Venkataramanan
K. V. Rangaswami
V. K. Magapu *
M. V. Kotwal
Ravi Uppal **
S. N. Subrahmanyan
R. Shankar Raman
S. N. Roy
21.72
51.82
4.24
22.72
16.39
16.39
20.91
20.91
49.33$
9.25
–
13.73
3.20
–
–
3.61
–
2.58
–
7.40
1.89
2.05
1.52
1.37
1.30
17.45
–
10.47
–
2.82
3.64
1.71
7.01
5.53
3.19
14.20
2.27
–
–
4.24
16.39
2.68
7.24
1.59
3.75
1.32
1.42
1.33
0.93
0.62
0.03
15.06
2.96
6.53
1.36
5.44
5.05
5.28
4.66
2.71
0.28
Total
51.82
49.33
Retired w.e.f. the close of working hours of September 30, 2012
*
** Ceased to be director w.e.f. the close of working hours of September 15, 2012
Includes leave encashment payment 1.25 crore
^^
^^^
Includes leave encashment payment 6.67 crore
^^^^ Includes leave encashment payment 6.54 crore
$
Out of total provision of 53.45 crore made during 2011-12, an amount of 4.12 crore was reversed during 2012-13.
197
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
@ Commission to directors comprises
Sr. Particulars
no.
1
2
3
Commission
Contribution to provident fund on commission
Contribution to superannuation fund on commission
Total
2012-13
40.80
4.90
6.12
51.82
crore
2011-12
38.84
4.66
5.83
49.33
“Major parties” denote entities accounting for 10% or more of the aggregate for that category of transaction during respective period.
iv. Amount due to/from related parties:
Nature of transaction/relationship/major parties
Sr.
no.
1 Accounts receivable
Subsidiaries, including:
Nabha Power Limited
L&T Ahmedabad-Maliya Tollway Limited
L&T Rajkot-Vadinar Tollway Limited
Associates & joint ventures, including:
The Dhamra Port Company Limited
Total
2
Accounts payable (including acceptance & interest accrued)
Subsidiaries, including:
L&T-MHI Boilers Private Limited
L&T-MHI Turbine Generators Private Limited
As at 31-3-2013
As at 31-3-2012
Amount Amounts for
major parties
Amount Amounts for
major parties
crore
2563.66
1418.24
70.81
2634.47
2970.21
1345.20
–
–
70.81
1274.69
974.45
79.43
1497.67
1675.49
Associates & joint ventures, including:
74.71
205.95
Audco India Limited
Metro Tunneling Chennai L&T SUCG Joint Venture
L&T-Chiyoda Limited
Salzer Electronics Limited
Total
3
Investment in Debt Securities
Subsidiaries:
L&T Infrastructure Finance Company Limited
L&T Finance Limited
Total
4
Loans & advances recoverable
Subsidiaries, including:
L&T Seawoods Private Limited
L&T-MHI Boilers Private Limited
L&T Realty Limited
L&T-MHI Turbine Generators Private Limited
Associates & joint ventures, including:
The Dhamra Port Company Limited
Key management personnel
Total
198
–
18.99
15.23
18.87
74.85
36.98
–
–
751.37
–
453.41
1881.44
211.83
211.83
2456.20
389.28
0.29
2845.77
3044.92
111.83
111.83
1980.01
480.57
0.01
2460.59
363.70
224.03
172.02
73.56
874.44
587.74
134.69
27.70
20.80
174.85
36.98
257.01
468.43
466.11
359.05
367.67
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Sr.
no.
5
Nature of transaction/relationship/major parties
Advances against equity contribution
Subsidiaries, including:
L&T Shipbuilding Limited
L&T Seawoods Private Limited
L&T Realty Limited
Total
6
Unsecured loans (including lease finance)
Subsidiaries:
L&T Infrastructure Development Projects Limited
L&T Transportation Infrastructure Limited
L&T Finance Limited
As at 31-3-2013
As at 31-3-2012
Amount Amounts for
major parties
Amount Amounts for
major parties
crore
2264.85
2382.08
421.86
1143.99
699.00
2264.85
2382.08
39.17
405.58
–
–
39.17
Total
39.17
405.58
7
Advances received in the capacity of supplier of goods/services
classified as “advances from customers” in the Balance Sheet
Subsidiaries, including:
1289.74
1603.34
Nabha Power Limited
L&T Metro Rail (Hyderabad) Limited
L&T Seawoods Private Limited
L&T BPP Tollway Limited
Total
8
Due to whole time directors
Key management personnel :
369.32
445.70
151.70
159.66
1289.74
1603.34
40.80
38.84 $
A. M. Naik
Y. M. Deosthalee
K. Venkataramanan
K. V. Rangaswami
V. K. Magapu *
M. V. Kotwal
Ravi Uppal **
S. N. Subrahmanyan
R. Shankar Raman
S. N. Roy
13.74
–
8.24
–
2.22
2.87
1.35
5.52
4.35
2.51
Total
40.80
38.84
Retired w.e.f. the close of working hours of September 30, 2012
*
** Ceased to be director w.e.f. the close of working hours of September 15, 2012
$ Out of total commission due to whole time directors of
42.08 crore during 2011-12, an amount of
3.24 crore was
reversed during 2012-13.
“Major parties” denote entities accounting for 10% or more of the aggregate for that category of transaction during respective period.
v. Notes to related party transactions:
a)
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, 2011 in line with Government of India (GOI) approval letter ref no. 12/3/2011-CL-VI dated November
17, 2011. The appointment shall be in effect as long as the joint venture agreement between the parent Company and M/s
Komatsu Asia Pacific Pte. Limited, Singapore (which is a subsidiary of Komatsu Limited, 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
199
852.49
781.99
706.00
178.00
155.00
72.58
890.18
168.16
–
–
11.86
2.33
5.14
1.07
4.28
3.98
4.16
3.67
2.13
0.22
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
is the exclusive agent of LTK to market Hydraulic Excavators and products manufactured by LTK and to provide after sales
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 financial impact of the aforesaid agreement has been included in/disclosed vide Note Q(10)(iii) supra.
Q(11) Disclosure in respect of Leases pursuant to Accounting Standard (AS 19) “Leases”
(i) Where the Company is a Lessor:
a.
The Company has given on finance leases certain items of plant and equipment. The leases have a primary period that
is fixed and non-cancellable. The leases are cancellable upon payment by the lessee of an additional amount such that,
at inception, continuation of the lease is reasonably certain. There are no exceptional/restrictive covenants in the lease
agreement.
b.
The total gross investment in these leases as on March 31, 2013 and the present value of minimum lease payments receivable
as on March 31, 2013 is as under:
1. Receivable not later than 1 year
2. Receivable later than 1 year and not later than 5 years
Particulars
Gross investment in lease (1+2+3)
Less: Unearned finance income
Present value of receivables
(ii) Where the Company is a lessee:
a)
Finance leases:
crore
31-3-2013
31-3-2012
0.51
0.06
0.57
0.07
0.50
0.45
0.90
1.35
0.48
0.87
i.
[a] Assets acquired on finance lease mainly comprise plant and equipment, 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.
[b] The minimum lease rentals and the present value of minimum lease payments in respect of assets acquired under
finance leases are as follows:
Particulars
Minimum lease payments
Present value of minimum
lease payments
As at
31-3-2013
As at
31-3-2012
As at
31-3-2013
As at
31-3-2012
crore
1. Payable not later than 1 year [Note (d) (II)]
2. Payable later than 1 year and not later than 5
years [Note (c)(I)(e)]
Total
Less: Future finance charges
Present value of minimum lease payments
[Note (c)(I)(e)]
42.66
–
42.66
3.49
39.17
42.66
42.66
85.32
12.74
72.58
39.17
–
33.41
39.17
39.17
72.58
ii. Contingent rent recognised/(adjusted) in the Statement of Profit and Loss in respect of finance leases: Nil (previous
year: Nil)
200
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
b) Operating leases:
i.
The Company has taken various commercial premises and plant and equipment 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 are as follows:
Particulars
1.
2.
Payable not later than 1 year
Payable later than 1 year and not later than 5 years
Total
crore
Minimum lease payments
As at
31-3-2013
As at
31-3-2012
1.75
0.17
1.92
1.73
1.63
3.36
[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: 86.78 crore (previous year: 89.37 crore).
iv. Contingent rent recognised in the Statement of Profit and Loss: Nil (previous year: 0.03 crore).
Q(12) Basic and diluted earnings per share [EPS] computed in accordance with pursuant to Accounting Standard (AS) 20 “Earnings per
Share”.
Basic
Particulars
Before extraordinary items
After extraordinary items
2012-13
2011-12
2012-13
2011-12
Profit after tax as per accounts ( crore)
Weighted average number of shares outstanding
Basic EPS ( )
Diluted
Profit after tax as per accounts ( crore)
Weighted average number of shares outstanding
Add: Weighted average number of potential equity
A
B
A/B
A
B
C
4839.04
4456.50
4910.65
4456.50
61,39,26,551 61,11,08,916 61,39,26,551 61,11,08,916
78.82
72.92
79.99
72.92
4839.04
4456.50
4910.65
4456.50
61,39,26,551 61,11,08,916 61,39,26,551 61,11,08,916
shares on account of employee stock options
50,50,853
58,66,093
50,50,853
58,66,093
Weighted average number of shares outstanding
D=B+C 61,89,77,404 61,69,75,009 61,89,77,404 61,69,75,009
for diluted EPS
Diluted EPS ( )
A/D
78.18
72.23
79.33
72.23
Face value per share ( )
2
2
2
2
Note: Potential equity shares that could arise on conversion of FCCBs are not resulting into dilution of EPS. Hence, they have not
been considered in working of diluted EPS in accordance with Accounting Standard (AS) 20.
201
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Q(13) Major components of deferred tax liabilities and deferred tax assets: pursuant to Accounting Standard (AS 22) “Accounting for Taxes
on Income”
Particulars
Deferred tax liabilities:
Deferred tax
liabilities/
(assets)
As at
31-3-2012
Charge/
(credit) to
Statement
of Profit and
Loss
Charge/
(credit) to
Hedging
reserve*
crore
Deferred tax
liabilities/
(assets)
As at
31-3-2013
Difference between book and tax depreciation
557.58
85.39
_
642.97
Gain on derivative transactions to be offered for tax purposes in
the year of transfer to the Statement of Profit and Loss
1.76
_
21.82
23.58
Disputed statutory liabilities paid and claimed as deduction for
tax purposes but not debited to the Statement of Profit and Loss
Other items giving rise to timing differences
Total
Deferred tax (assets):
55.65
28.47
26.67
65.62
_
_
82.32
94.09
643.46
177.68
21.82
842.96
Provision for doubtful debts and advances debited to the
Statement of Profit and Loss
(238.28)
16.45
–
(221.83)
Loss on derivative transactions to be claimed for tax purposes in
the year of transfer to the Statement of Profit and Loss
(146.57)
–
(48.40)
(194.97)
Unpaid statutory liabilities/provision for compensated absences
debited to the Statement of Profit and Loss
Other items giving rise to timing differences
Total
Net deferred tax liability/(assets)
previous year
(111.74)
(13.86)
(510.45)
133.01
263.47
(20.25)
(38.09)
(41.89)
135.79
–
–
(131.99)
(51.95)
(48.40)
(600.74)
(26.58)
242.22
39.70
(170.16)
133.01
(332.87 crore) [previous year : (301.53 crore)] represents net gains/(losses) on effective hedges recognised in
* The amount of
hedge reserve, applying the principles of hedge accounting set out in the Accounting Standard (AS) – 30 “Financial Instruments:
Recognition and Measurement”. The amount is after considering the net deferred tax asset of 26.58 crore (previous year : 170.16
crore).
Q(14) Disclosures in respect of joint ventures pursuant to Accounting Standard (AS) 27 “Financial Reporting of Interests in Joint Ventures”
a)
List of joint ventures
Name of joint venture
Description of interest/(description of job)
Proportion
of ownership
interest (%)
Country
of
residence
L&T-Hochtief Seabird Joint Venture
International Metro Civil Contractors
Jointly controlled entity (Construction of breakwater
at Karwar)
Jointly controlled entity (Construction of Delhi metro
corridor phase I tunnel project)
90
26
India
India
Sr.
no.
1
2
202
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Sr.
no.
Name of joint venture
Description of interest/(description of job)
Proportion
of ownership
interest (%)
Country
of
residence
3
4
5
6
7
8
9
HCC-L&T Purulia Joint Venture
Desbuild-L&T Joint Venture
Metro Tunnelling Group
L&T-AM Tapovan Joint Venture
Jointly controlled entity (Construction of pumped
storage project)
Jointly controlled entity (Renovation of US consulate,
Chennai)
Jointly controlled entity (Construction of Delhi metro
corridor-phase II tunnel project)
Jointly controlled entity (Construction of head race
tunnel for Tapovan Vishnugad hydroelectric project
at Chamoli, Uttaranchal)
L&T-Shanghai Urban Corporation Group
Joint Venture
Jointly controlled entity (Construction of twin tunnel
between IGI airport and sector 21 for DMRC)
L&T-Eastern Joint Venture
Metro Tunnelling Chennai
L&T–SUCG Joint Venture
Jointly controlled entity
maintenance of 295 residential units at Dubai)
(Construction and
Jointly controlled entity (Construction of UG Station
at Nehru Park, KMC and Pachiyappas College and
associated tunnels for Chennai Metro Rail Limited)
10 Metro Tunneling Delhi-L&T SUCG Joint
Venture
Jointly controlled entity (Construction of Delhi metro
corridor tunnel project phase – CC5)
11
12
L&T-Shapoorji Pallonji & Co. Ltd. Joint
Venture -TCS
Jointly controlled entity [Design & build work for
construction of TCS SEZ at Kolkata, West Bengal (JV
with Shapoorji Pallonji & Co. Ltd)]
L&T-Shanghai Urban Construction (Group)
Joint Venture CC27 Delhi
Jointly Controlled Entity (Design and Construction of
Tunnel for Delhi MRTS Project for Phase-III)
13
L&T-KBL (UJV) Hyderabad
14
L&T-HCC Joint Venture
Jointly controlled operations (Investigation, design,
supply and erection of lift irrigation system)
Jointly controlled operations (Four laning and
strengthening of existing two lane sections from
240 Km to 320 Km on NH2)
Patel-L&T Consortium
Jointly controlled operations (Hydroelectric project)
15
16
L&T-SVEC Joint Venture
17
L&T-KBL-MAYTAS UJV
Jointly controlled operations (Lift irrigation project
at Hyderabad)
Jointly controlled operations (Transmission of 735
mId treated water associated with all civil, electrical
& mechanical work at Hyderabad)
18
19
Consortium of Toyo Engineering Company
and L&T
Jointly controlled operations (Execution of naphtha
cracker associated unit for IOCL, Panipat)
L&T and Scomi Engineering BHD. Joint
Venture
Jointly controlled operations (Implementation of
monorail system in Mumbai)
43
49
26
65
51
65
75
60
50
68
-
-
-
-
-
–
–
India
India
India
India
India
UAE
India
India
India
India
India
India
India
India
India
India
India
203
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
b)
Financial interest in jointly controlled entities (to the extent of the Company’s share)
Sr.
no.
1
2
Name of Integrated
joint ventures/jointly
controlled entities
L&T-Hochtief Seabird Joint
Venture
International Metro Civil
Contractors
3 Metro Tunnelling Group
4
5
6
7
8
L&T-Shanghai Urban
Corporation Group Joint
Venture
HCC-L&T Purulia Joint
Venture
L&T-AM Tapovan JV
Desbuild-L&T Joint
Venture
L&T – Eastern Joint
Venture
9 Metro Tunnelling Chennai
L&T-SUCG JV-CMRL
10 DMRC– CC 05 JV
11
12
L&T–Shapoorji Pallonji &
Co. Ltd. Joint Venture-TCS
L&T–SUCG JV
– CC27- Delhi
Total
Share of net assets in
jointly controlled entities
Amounts less than 0.01 crore:
As at March 31, 2013
Assets
Liabilities
Income
Expenses
For the Year 2012-13
Tax
Company’s share
46.89
(47.13)
3.84
(4.49)
7.03
(8.14)
5.08
(5.06)
2.91
(2.96)
57.98
(60.19)
-0.01
(0.28)
32.57
(32.70)
141.76
(143.78)
117.23
(6.98)
52.24
(–)
103.65
(–)
571.17
(311.71)
– #
(–)
0.02
(0.01)
3.00
(1.72)
0.77
(2.62)
0.01
(0.01)
0.36
(0.05)
-1.63
(0.36)
0.47
(0.30)
–
(–)
–
(0.48)
0.69
(-0.52)
0.09
(0.74)
– $
– %
– ^
(0.20)
30.08
(91.31)
(0.01)
44.73
(114.77)
– Ω
(–) ##
– €
(–) @@
0.41
(2.17)
181.09
(109.24)
110.12
(3.13)
92.51
(–)
18.57
(–)
436.57
(210.40)
8.04
(1.15)
170.57
(108.51)
108.51
(3.13)
92.24
(–)
18.57
(–)
441.87
(228.29)
(0.03)
–
(–)
–
(–)
–
(–)
3.41
(0.24)
0.50
(–)
0.08
(–)
–
(–)
4.77
(0.97)
66.09
(66.49)
12.23
(13.70)
21.68
(21.16)
17.82
(17.59)
2.98
(3.33)
141.00
(131.51)
0.04
(0.34)
36.63
(44.20)
170.65
(144.26)
123.54
(10.01)
57.43
(–)
103.65
(–)
753.74
(452.59)
182.57
(140.88)
crore
Net loss
(Note O)
– ¥
(0.01)
0.34
(0.52)
–
(–)
–
(–)
– ‡
(–)
14.65
(23.46)
– †
(–) Ω Ω
7.63
(–)
–
(–)
–
(–)
–
(–)
–
(–)
22.62
(23.99)
Net profit
(Note K)
–
(–)
–
(–)
1.48
(1.88)
0.21
(1.58)
–
(0.16)
–
(–)
–
(–)
–
(1.02)
7.11
(0.49)
1.11
(–)
0.19
(–)
–
(–)
10.10
(5.13)
Current Year: # 39313, ¥ 11925, $ 46549, % 47781, ^ 7326, ‡ 8558, Ω 520, € 8289, † 7769
previous Year: ## ( 1213), @@ ( 8258), Ω Ω ( 7045)
Figures in brackets ( ) relate to previous year.
Notes:
i.
ii. Contingent liabilities, if any, incurred in relation to interests in joint ventures as at March 31, 2013:
Nil); and share in contingent liabilities incurred jointly with other ventures as at March 31, 2013:
Nil).
Nil (previous year:
Nil (previous year:
iii. Share in contingent liabilities of joint ventures themselves for which the Company is contingently liable as at March 31,
2013: 65.95 crore (previous year: 61.43 crore).
iv. Contingent liabilities in respect of liabilities of other ventures of joint ventures as at March 31, 2013: Nil (previous year:
Nil).
v. Capital commitments, if any, in relation to interests in joint ventures as at March 31, 2013: 37.18 crore (previous year:
28.56 crore)
204
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Q(15) Disclosures required by pursuant to Accounting Standard (AS) 29 “Provisions, Contingent Liabilities and Contingent Assets”:
a) Movement in provisions:
Particulars
Product
warranties
Balance as at 1-4-2012
Additional provision during the year
Provision used/reversed during the year
Provision transferred due to transfer of business
Balance as at 31-3-2013 (5=1+2-3-4)
10.84
6.71
(8.12)
(0.07)
9.36
Sr.
no.
1
2
3
4
5
Expected
tax liability
in respect
of indirect
taxes
59.13
21.05
(2.65)
–
77.53
crore
Others
Total
Class of Provisions
Litigation
related
obligations
Contractual
rectification
cost-
construction
contracts
471.36 52.89
–
141.54
(299.29)
(52.89) #
603.27
177.51
(371.16) ##
9.05
8.21
(8.21)
–
9.05
313.61
–
–
–
(0.07)
409.55
#
##
being reversal of an extraordinary item included in opening provision [Note 3(b) supra]
includes provision used during the year 47.64 crore (previous year: 2.43 crore)
b) Nature of provisions:
i.
ii.
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, 2013 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.
Expected tax liability in respect of indirect taxes represents mainly the differential sales tax liability on account of non-
collection of declaration forms for the period prior to 5 years.
iii. Provision for litigation related obligations represents liabilities that are expected to materialise in respect of matters in
appeal.
iv. 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”.
v. Others represent residual provision in respect of Company’s investment in shares of Satyam Computer Services Limited.
c) Disclosure in respect of contingent liabilities is given as part of Note (l) to the Balance Sheet.
Q(16) 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, 2013 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
e) Currency futures
For hedging commodity price risks:
Commodity futures
i
ii
crore
Amount of exposures hedged
As at
31-3-2013
As at
31-3-2012
7940.24
10540.83
10046.71
8692.37
4051.11
21.99
–
5003.17
39.35
330.69
242.59
171.67
205
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
b) Un-hedged foreign currency exposures as at March 31, 2013 are as under:
Un-hedged foreign currency exposures
i
ii
Receivables, including firm commitments and highly probable forecasted transactions
Payables, including firm commitments and highly probable forecasted transactions
Q(17) Auditors’ remuneration (excluding service tax) and expenses charged to the accounts:
As auditor
For Taxation matters
For Other services
For reimbursement of expenses
Q(18) Value of imports (on C.I.F. basis):
Raw materials
Components and spare parts
Capital goods
Q(19) Expenditure in foreign currency:
On overseas contracts
Royalty and technical know-how fees
Interest
Professional/consultation fees
Other matters
Q(20) Dividends remitted in foreign currency:
Particulars
Particulars
Particulars
Particulars
Dividend for the year ended March 31, 2012 remitted to:
i.
12 non-resident shareholders on 15,700 shares held by them (previous year: 15,700 shares)
on 28-8-2012
As at
31-3-2013
28042.53
24924.49
crore
As at
31-3-2012
24678.23
26301.62
2012-13
1.08
0.26
2.03
0.07
2012-13
1961.34
3051.19
377.93
2012-13
8254.18
7.03
161.43
242.46
1124.86
crore
2011-12
0.90
0.22
1.22
0.10
crore
2011-12
1273.10
4027.24
714.61
crore
2011-12
3103.88
16.14
103.11
130.94
1571.65
crore
2012-13
2011-12
0.03
0.02
ii. Custodian of global depositary receipts on 1,96,66,240 shares (previous year: 2,50,91,514
32.45
36.38
shares) on 28-8-2012
Q(21) Earnings in foreign exchange:
Particulars
Export of goods [including 978.53 crore on FOB basis (previous year: 825.78 crore)]
Construction and project related activities
Export of services
Commission
Interest received
Other receipts
2012-13
1016.03
10693.89
1319.77
19.08
0.05
74.87
crore
2011-12
852.97
6173.43
884.49
27.19
0.04
99.93
206
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Q(22) The Company has amounts due to suppliers under The Micro, Small and Medium Enterprises Development Act, 2006, [MSMED Act]
as at March 31, 2013. The disclosure pursuant to the said Act is as under:
Principal amount due to suppliers under MSMED Act, 2006
Particulars
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
crore
2012-13
2011-12
67.17
0.05
8.65
–
0.02
0.08
0.32
60.53
0.05
39.85
–
0.22
0.37
0.37
Q(23) (a) The Company has adopted a new accounting policy [Note R(18)(f)] for separate accounting of embedded derivatives with effect
from April 1, 2012, for more appropriate presentation of the financial statements. The profit before tax is lower by 55.36 crore
pursuant to adoption of the new accounting policy for separate accounting of embedded derivatives.
(b) The Company has changed the accounting policy for recognition of revenue from real estate development transactions pursuant
to the guidance note on accounting for Real Estate Transactions (Revised 2012) issued by the Institute of Chartered Accountants
of India [Note R(3)(A)(a)(iii)]. The profit before tax of the Company is higher by 2.39 crore pursuant to change in the accounting
policy of revenue recognition for real estate development transactions.
Q(24) There are no amounts due and outstanding to be credited to Investor Education & Protection Fund as at March 31, 2013.
Q(25) Details of sales, raw materials and components consumed, manufacturing work-in-progress and purchase of stock in trade:
a)
Sales:
Class of goods
(i) Manufacturing and trading activity:
Switchgear, all types
Valves and accessories
Earthmoving and agriculture machinery and spares
Industrial Machinery
Electricity meters
Rubber processing machinery and accessories
Parts and accessories for Prime movers, Boilers, Steam Generating Plants and Nuclear
reactors
Welding alloys and accessories
Industrial electronic control panels
Patient monitoring system and accessories
Defence equipment, all types
Chemical plant & machinery, including pharmaceutical, dyestuff, distillery, brewery and
solvent extraction plants, evaporator and crystallizer plants and pollution control
equipment in aggregate
Transmission line tower
Steel structural fabrication
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.
2012-13
2011-12
crore
crore
1987.02
1531.17
852.19
656.96
473.69
311.14
293.05
0.19
–
91.30
38.42
35.99
45.12
39.06
25.72
777.36
616.91
560.24
371.37
324.92
88.90
71.46
68.08
62.02
56.60
53.34
38.82
14.48
140.50
12.46
207
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
Class of goods
Electro surgical unit and accessories
Nuclear purpose equipment, de-aerators, ultra high pressure vessels including multiwall
vessels, high pressure heat exchangers and high pressure heaters in aggregate
Design, development and manufacturing of airborne assemblies, system and equipment
for Aircrafts, Helicopters & unmanned aerial vehicles and equipment for the aviation
sector
Ultrasound equipment and accessories
Ship auxiliaries and components of mechanised sailing vessels
Others
Total
(ii) Property development activity
(iii) Construction and project related activity:
Civil / Infrastructure / Mechanical / Electrical Construction
Thermal/Hydro/Gas power plants
Chemical plant & machinery, including pharmaceutical, dyestuff, distillery, brewery and
solvent extraction plants, evaporator and crystallizer plants and pollution control
equipment 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.
Defence equipment, all types
Nuclear purpose equipment, de-aerators, ultra high pressure vessels including multiwall
vessels, high pressure heat exchangers and high pressure heaters in aggregate
Ship auxiliaries and components of mechanised sailing vessels
Parts and accessories for Prime movers, Boilers, Steam generating plants and Nuclear
reactors
Design, development and manufacturing of airborne assemblies, system and equipment
for Aircrafts, Helicopters & unmanned aerial vehicles and equipment for the aviation
sector
Commercial ships
Others
Total
(iv) Servicing
(v) Commission
(vi) Engineering and service fees
Total Sales & service (i) to (vi)-[Note K]
2012-13
2011-12
crore
2.61
crore
5.36
–
4.69
1.67
–
0.71
1.48
0.92
0.62
1380.36
1706.39
6375.70
6367.59
73.79
21.70
32699.95
26633.56
8023.74
7239.73
3592.03
4871.31
5143.41
445.77
117.91
1.65
4673.12
371.27
30.73
22.24
9.34
14.24
14.13
(71.26)
8.43
6.41
2641.96
1485.67
52618.63
45356.71
406.08
158.77
1215.03
285.63
205.01
875.74
60848.00
53112.38
208
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
b) Raw materials and components consumed:
i)
Class of goods:
Class of goods
Power plant & machinery components
Chemical plant components
Nuclear equipment components, including items for oil & gas industries, etc. in
aggregate
Steel
Switchgear components
Electronic devices, test & measuring instruments and industrial electronic control
panel components
Non-ferrous metals
Metering & protection systems and medical equipment and components
Industrial machinery components
Bakelite
Others
Sub-total
Less: Sale value of scrap
Total [Note M]
ii) Classification of goods:
2012-13
2011-12
crore
4431.24
1759.20
crore
3747.86
2575.95
1778.01
1169.08
694.89
857.39
46.57
132.17
35.16
11.54
–
656.49
669.04
138.84
129.09
33.17
11.05
4.75
1293.11
1068.50
11039.28
10203.82
146.99
111.70
10892.29
10092.12
Classification of goods
Imported (including through canalising agencies)
Indigenous
Total
2012-13
2011-12
% to total
consumption
crore
% to total
consumption
crore
42
58
4574.84
6317.45
39
61
3943.31
6148.81
100
10892.29
100
10092.12
c)
Purchases of stock in trade
Class of goods
Electronic, medical & other instruments, accessories and spares
Valves and accessories
Earthmoving and agricultural machinery and spares
Industrial Machinery
Welding alloys and accessories
Others
Total [Note M]
2012-13
crore
772.62
519.80
302.13
105.39
–
363.29
2011-12
crore
872.23
520.10
385.62
120.86
49.66
420.93
2063.23
2369.40
209
Notes forming part of the Accounts (contd.)
NOTE [Q] (contd.)
d) Details of Work-in-progress:
Class of goods
2012-13
crore
2011-12
crore
Industrial Machinery
Defence equipment, all types
Steel structural fabrication
Switchgear, all types
Transmission line tower
Chemical plant & machinery, including pharmaceutical, dyestuff, distillery, brewery and solvent
extraction plants, evaporator and crystallizer plants and pollution control equipment in
aggregate
Low voltage and Medium voltage switchboards and panels
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
Casting products
Rubber processing machinery and accessories
Nuclear purpose equipment, de-aerators, ultra high pressure vessels including multiwall vessels,
high pressure heat exchangers and high pressure heaters in aggregate
Ship auxiliaries and components of mechanised sailing vessels
Parts for aircraft
Valves and accessories
Servicing of construction machinery
AC drives, DC drives, programmable logic controllers
Meters and protection systems
Patient monitoring system and accessories
Others
Total [Note H(II)]
59.79
63.97
37.86
49.13
60.64
49.09
61.44
35.04
20.38
19.34
5.67
93.39
–
1.89
10.58
2.06
0.58
–
68.01
63.53
53.16
46.97
46.36
43.43
35.41
23.81
20.09
16.49
4.56
4.12
2.26
2.06
1.60
1.18
0.29
0.02
75.74
646.59
32.94
466.29
Q(26) Figures for the previous year have been regrouped/reclassified wherever necessary.
210
Notes forming part of the Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES
1. Basis of accounting
The Company maintains its accounts on accrual basis following the historical cost convention [except for the revaluation of certain fixed
assets], in accordance with generally accepted accounting principles [“GAAP”] 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. Further, the guidance notes/announcements issued by the Institute of Chartered Accountants of India (ICAI) are also
considered, wherever applicable except to the extent where compliance with other statutory promulgations viz. SEBI guidelines override
the same requiring a different treatment.
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, allowance 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. Presentation of financial statements
The Balance Sheet and the Statement of Profit and Loss are prepared and presented in the format prescribed in the Schedule VI to the
Companies Act, 1956 (“the Act”). The Cash Flow Statement has been prepared and presented as per the requirements of Accounting
Standard (AS) 3 “Cash Flow Statements”. The disclosure requirements with respect to items in the Balance Sheet and Statement of
Profit and Loss, as prescribed in the Schedule VI to the Act, are presented by way of notes forming part of accounts along with the
other notes required to be disclosed under the notified Accounting Standards and the Listing Agreement.
Amounts in the financial statements are presented in Indian Rupees in crore [1 crore = 10 million] rounded off to two decimal places
in line with the requirements of Schedule VI. Per share data are presented in Indian Rupees to two decimals places.
3. 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. Revenue from operations
a.
Sales & Service
i.
ii.
Sales and service include excise duty and adjustments made towards liquidated damages and price variation, wherever
applicable. Escalation and other claims, which are not ascertainable/acknowledged by customers, are not taken into
account.
Revenue from sale of manufactured and traded 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 which are in substance similar to delivery of goods 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.
Revenue from those property development activities [Note no.Q23(b)] which have the same economic substance as that
of a construction contract is recognised based on the ‘Percentage of Completion method’ (POC) when the outcome
of a real estate project can be estimated reliably upon fulfillment of all the following conditions:
a. All critical approvals necessary for commencement of the project have been obtained;
b. When the stage of completion of the project reaches a reasonable level of development i.e. contract costs for
work performed bears a reasonable proportion to the estimated total contract costs. For this purpose, a reasonable
level of development is treated as achieved only if the cost incurred (excluding cost of land/developmental rights
and borrowing cost) is atleast 25% of the total of such cost;
c.
Atleast 25% of the saleable project area is secured by contracts or agreements with buyers;
d. Atleast 10 % of the total revenue as per the agreements of sale or any other legally enforceable documents are
realised at the reporting date in respect of each of the contracts and it is reasonable to expect that the parties
to such contracts will comply with the payment terms as defined in the contracts.
211
Notes forming part of the Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
The costs incurred on property development activities are carried as “inventories” till such time the outcome of the
project cannot be estimated reliably and all the aforesaid conditions are fulfilled. When the outcome of the project
can be ascertained reliably and all the aforesaid conditions are fulfilled, revenue from property development activity
is recognized at cost incurred plus proportionate margin, using percentage of completion method. Percentage of
completion is determined based on the proportion of actual cost incurred to the total estimated cost of the project.
For this purpose, actual cost includes cost of land and developmental rights but excludes borrowing cost.
Expected loss, if any, on the project is recognised as an expense in the period in which it is foreseen, irrespective of
the stage of completion of the contract.
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: Contract revenue is recognized only to the extent of cost incurred till such time the outcome
of the job cannot be ascertained reliably. When the outcome of the contract is ascertained reliably, contract
revenue is recognized at cost of work performed on the contract plus proportionate margin, using the percentage
of completion method. Percentage of completion is the proportion of cost of work performed to-date, to the
total estimated contract costs.
Government grants in the nature of subsidy related to customer contracts is recognised as revenue from operations
in the Statement of Profit and Loss, on a prudent basis, in proportion to work completed when there is reasonable
assurance that the conditions for the grant of subsidy will be fulfilled.
Expected loss, if any, on the construction/project related activity is recognized as an expense in the period in
which it is foreseen, irrespective of the stage of completion of the contract. While determining the amount of
foreseeable loss, all elements of costs and related incidental income not included in contract revenue is taken
into consideration.
v.
Revenue from contracts for the rendering of services which are directly related to the construction of an asset is
recognised on similar basis as stated in (iv) above.
vi. Revenue 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.
vii. Revenue from service related activities is recognised using the proportionate completion method.
viii. Commission income is recognised as and when the terms of the contract are fulfilled.
ix. Revenue from engineering and service fees is recognised as per the terms of the contract.
x.
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.
b. Other operational revenue
Other operational revenue represents income earned from the activities incidental to the business and is recognised when
the right to receive the income is established as per the terms of the contract.
B. Other Income
i.
Interest income is accrued at applicable interest rate.
ii. Dividend income is accounted in the period in which the right to receive the same is established.
212
Notes forming part of the Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
iii. Other Government grants, which are revenue in nature and are towards compensation for the related costs, are recognised
as income in the Statement of Profit and Loss in the period in which the matching costs are incurred.
iv. Other items of income are accounted as and when the right to receive arises.
4. Extraordinary and exceptional Items
Income or expenses that arise from events or transactions that are clearly distinct from the ordinary activities of the Company are
classified as extraordinary items. Specific disclosure of such events/transactions is made in the financial statements. Similarly, any
external event beyond the control of the Company, significantly impacting income or expense, is also treated as extraordinary item
and disclosed as such.
On certain occasions, the size, type or incidence of an item of income or expense, pertaining to the ordinary activities of the Company,
is such that its disclosure improves an understanding of the performance of the Company. Such income or expense is classified as an
exceptional item and accordingly disclosed in the notes to accounts.
5. Research and development
a.
Revenue expenditure on research is expensed under respective heads of account in the period in which it is incurred.
b. Development expenditure on new products is capitalised as intangible asset, if all of the following can be demonstrated:
i.
The technical feasibility of completing the intangible asset so that it will be available for use or sale
ii.
The Company has intention to complete the intangible asset and use or sell it
iii. The Company has ability to use or sell the intangible asset
iv.
v.
The manner in which the probable future economic benefits will be generated including the existence of a market for
output of the intangible asset or intangible asset itself or if it is to be used internally, the usefulness of intangible assets
The availability of adequate technical, financial and other resources to complete the development and to use or sell the
intangible asset and
vi. The Company has ability to measure the expenditure attributable to the intangible asset during its development reliably
The development expenditure capitalised as intangible asset is amortised over its useful life.
Other development costs that do not meet above criteria are expensed in the period in which they are incurred.
6. 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.
b.
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.
ii. 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. The present value of the obligation
under such defined benefit plans is determined based on actuarial valuation using the Projected Unit Credit Method.
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 Statement of Profit and Loss.
213
Notes forming part of the Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
The interest element in the actuarial valuation of defined benefit plans, which comprises the implicit interest cost and the impact
of changes in discount rate, is classified under finance costs. The balance charge is recognised as employee benefit expenses in
the Statement of Profit and Loss.
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 a 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.
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 are recognised as expense in the
period in which they are incurred.
c.
d.
7. Tangible Fixed assets
Tangible fixed assets are stated at original cost net of tax/duty credits availed, if any, less accumulated depreciation 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 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 equipment 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.
Tangible assets not ready for the intended use on the date of the Balance Sheet are disclosed as “capital work-in-progress”.
(Also refer to policy on leases, borrowing costs, impairment of assets and foreign currency transactions infra.)
8.
Leases
The determination of whether an agreement is, or contains, a lease is based on the substance of the agreement at the date of
inception.
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 Statement of Profit and Loss.
b.
Lease transactions entered into on or after April 1, 2001:
Finance leases:
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 given under Leases where the Company has transferred substantially all the risks and rewards of ownership to lessee,
are classified as finance leases. 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.
iii.
Initial direct costs relating to assets given on finance leases are charged to Statement of Profit and Loss.
214
Notes forming part of the Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
Operating leases:
i)
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 Statement of Profit and Loss on accrual basis.
ii) Assets leased out under operating leases are capitalised. Rental income is recognised on accrual basis over the lease term.
(Also refer to policy on depreciation infra).
9. Depreciation
a. Owned assets
i.
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 Statement of
Profit and Loss.
ii. 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.
Furniture and fixtures
i)
ii) Office Equipment
Category of asset
Multifunctional devices (fax machine/scanner/printers), inkjet/laserjet printers,
switches (audio/video) and projectors
Others
iii) Computers
Desktop, Server & related components
iv) Plant and Equipment general
a) Cranes below 100 ton capacity used for construction activity
b) Minor plant & equipment of construction activity
c) Heavy lift equipment of construction activity
d)
Equipment for tunnelling & laying electrical transmission lines (other than those
employed in heavy construction work)
Equipment used in construction industry for concreting, road making, crushing,
piling, pipeline laying, welding etc.
e)
Erection winches above 2 tons
Strand Jack system, theodolite, total station etc. used in construction industry
Specialised machine tools, dies, jigs, fixtures, gauges for electrical business
Desktops and laptops given to employees under the Company’s scheme
f) DG sets above 30 kva
g)
h)
i)
j)
k) Other laptops
l)
Tunnel Boring Machine
v) Air conditioning and refrigeration equipment
vi)
vii) Motor cars
Laboratory and canteen equipment
Rate of Depreciation
(% p.a.)
10.00
25.00
6.67
16.67
6.67
20.00
5.00
10.00
8.33
8.33
8.33
8.33
20.00
33.33
25.00
50.00
8.33
12.50
14.14
215
Notes forming part of the Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
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:
Lease charge comprising statutory depreciation and lease equalisation charge is provided for assets given on lease over the
primary period of the lease equal to recovery of net investment in 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 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.
iii.
Leasehold land:
Land acquired under long term lease is classified under “tangible assets” and is depreciated over the period of lease.
10. Intangible assets and amortisation
Intangible assets are stated at original cost net of tax/duty credits availed, if any, less accumulated amortisation and cumulative
impairment. 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.
Specialised software: over a period of six years
b.
Technical know-how: over a period of six years in case of foreign technology and three years in the case of indigenous technology
c. Development costs for new products: over a period of five years
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.
Intangible assets not ready for the intended use on the date of the Balance Sheet are disclosed as “Intangible assets under development”.
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.
11. 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; and
b.
the reversal of impairment loss recognised in previous periods, if any.
Impairment loss is recognised when the carrying amount of an asset exceeds its recoverable amount.
Recoverable amount is determined:
a.
in the case of an individual asset, at the higher of the net selling price and the value in use;
b.
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).
216
Notes forming part of the Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
12. Investment:
Trade investments comprise investments in subsidiary companies, joint ventures, associate companies and in the entities in which the
Company has strategic business interest.
Investments, which are readily realisable and are intended to be held for not more than one year from the date of acquisition, are
classified as current investments. All other investments are classified as long term investments.
Long term investments including trade investments are carried at cost, after providing for any diminution in value, if such diminution
is other than temporary in nature. Investments in integrated joint ventures are carried at cost net of adjustments for Company’s share
in profits or losses as recognised.
Current investments are carried at lower of cost and fair value. The determination of carrying amount of such investments is done
on the basis of weighted average cost of each individual investment.
Purchase and sale of investments are recognised based on the trade date accounting.
13. 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. Manufacturing work-in-progress at lower of cost including related overheads or net realisable value. In the case of qualifying
assets, cost also includes applicable borrowing costs vide policy relating to borrowing costs
c.
Finished goods and stock in trade (in respect of goods acquired for trading) at lower of weighted average cost or net realisable
value. Cost includes related overheads and excise duty paid/payable on such goods
d. Completed property/Work-in-progress (including land) in respect of property development activity at lower of cost or net realisable
value
14. Cash and bank balances
Cash and bank balances also include fixed deposits, margin money deposits, earmarked balances with banks and other bank balances
which have restrictions on repatriation. Short term and liquid investments being not free from more than insignificant risk of change
in value, are not included as part of cash and cash equivalents.
15. 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.
Expenses incurred on issue of shares
ii.
Expenses (net of tax) incurred on issue of debentures/bonds
iii. Premium (net of tax) on redemption of debentures/bonds
16. Borrowing Costs:
Borrowing costs include interest, commitment charges, amortisation of ancillary costs, amortisation of discounts/premium related to
borrowings, finance charges in respect of assets acquired on finance lease and exchange differences arising from foreign currency
borrowings, to the extent they are regarded as an adjustment to interest costs.
Borrowing costs that are attributable to the acquisition, construction or production of a qualifying asset are capitalised/inventorised
as part of cost of such asset till such time the asset is ready for its intended use or sale. A qualifying asset is an asset that necessarily
requires a substantial period of time 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.
217
Notes forming part of the Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
17. 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.
18. Foreign currency transactions, foreign operations, forward contracts and derivatives
a.
The reporting currency of the Company is Indian rupee.
b.
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, 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 of monetary items at each balance sheet date
at the closing rate are:
i.
ii.
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
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.
e.
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 recognized 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.
f. 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 ICAI dated March 29, 2008 on accounting of derivatives. In addition, the
derivative arrangements embedded in the contracts entered in the course of business are accounted separately if the economic
characteristics and risks of the embedded derivatives are not closely related to economic characteristics and risks of the host
contract [Note Q23(a)].
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.
218
Notes forming part of the Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
Accordingly, the resultant gains or losses on fair valuation/settlement of the derivative contracts (including embedded derivatives)
covered under Accounting Standard (AS) 30 “Financial Instruments: Recognition and Measurement” are recognised in the
Statement of Profit and Loss or Balance Sheet as the case may be after applying the test of hedge effectiveness. Where the hedge
in respect of off-balance sheet items is effective, the gains or losses are recognised in the “hedging reserve” which forms part
of “reserves and surplus” in the Balance Sheet. The amount recognised in the “hedging reserve” is transferred to the Statement
of Profit and Loss in the period in which the underlying hedged item affects the Statement of Profit and Loss. Gains or losses in
respect of ineffective hedges are recognised in the Statement of Profit and Loss in the period in which such gains or losses are
incurred.
g.
The premium paid/received on a foreign currency forward contract is accounted as expense/income over the life 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.
iii.
iv.
v.
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
Income which relates to the Company as a whole and not allocable to segments is included in “unallocable corporate
income”
Segment result includes margins on inter-segment capital jobs, which are reduced in arriving at the profit before tax of the
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
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
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.
21. 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.
219
Notes forming part of the Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
Type of joint venture
Accounting treatment
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) Company’s share in profits or losses of integrated joint ventures is accounted on
determination of the profits or losses by the joint ventures.
(ii)
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 thesame is established.
Investment in such joint ventures is carried at cost after providing for any diminution in
value which is otherthan temporary in nature.
Joint venture interests accounted as above, other than investments in incorporated jointly controlled entities, are included in the
segments to which they relate.
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.
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.
23. Commitments
Commitments are future liabilities for contractual expenditure.
Commitments are classified and disclosed as follows:
a.
Estimated amount of contracts remaining to be executed on capital account and not provided for
b. Uncalled liability on shares and other investments partly paid
c.
Funding related commitment to subsidiary, associate and joint venture companies and
d. Other non-cancellable commitments, if any, to the extent they are considered material and relevant in the opinion of management.
Other commitments related to sales/procurements made in the normal course of business are not disclosed to avoid excessive details.
220
Notes forming part of the Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
24. Operating cycle for current and non-current classification
Operating cycle for the business activities of the Company covers the duration of the specific project/contract/product line/service
including the defect liability period, wherever applicable and extends up to the realisation of receivables (including retention monies)
within the agreed credit period normally applicable to the respective lines of business.
25. Cash Flow Statement
Cash Flow Statement is prepared segregating the cash flows from operating, investing and financing activities. Cash flow from
operating activities is reported using indirect method. Under the indirect method, the net profit is adjusted for the effects of:
I.
transactions of a non-cash nature
II.
any deferrals or accruals of past or future operating cash receipts or payments and
III.
items of income or expense associated with investing or financing cash flows
Cash and cash equivalents (including bank balances) are reflected as such in the Cash Flow Statement. Those cash and cash equivalents
which are not available for general use as on the date of Balance Sheet are also included under this category with a specific disclosure.
As per our report attached
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
Mumbai, May 22, 2013
A. M. NAIK
Group Executive Chairman
K. VENKATARAMANAN
Chief Executive Officer &
Managing Director
R. SHANKAR RAMAN
Chief Financial Officer &
Whole-time Director
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
A. K. JAIN
M. DAMODARAN
SUSHOBHAN SARKER
Directors
Mumbai, May 22, 2013
N. HARIHARAN
Company Secretary
221
Consolidated Financial Statements 2012-13
Independent Auditors’ Report
To the Board of Directors of Larsen & Toubro Limited
We have audited the accompanying consolidated financial statements of Larsen & Toubro Limited (“the Company”) and its subsidiaries,
associates and joint ventures (“the L&T Group”) which comprise the consolidated balance sheet as at March 31, 2013, and the consolidated
statement of profit and loss and consolidated cash flow statement for the year then ended, and a summary of significant accounting
policies and other explanatory information.
Management’s responsibility for the consolidated financial statements
Management is responsible for the preparation of these consolidated financial statements that give a true and fair view of the consolidated
financial position, consolidated financial performance and consolidated cash flows of the Company in accordance with accounting
principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant
to the preparation and presentation of the consolidated financial statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor’s responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in
accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we
comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial
statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial
statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement
of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal
control relevant to the Company’s preparation and presentation of the consolidated financial statements that give a true and fair view
in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall
presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the explanations given to us and based on the consideration of the
reports of the other auditors on the financial statements of the subsidiaries, associates and joint ventures as noted below, the consolidated
financial statements give a true and fair view in conformity with the accounting principles generally accepted in India:
a)
in the case of the consolidated balance sheet, of the state of affairs of the L&T Group as at March 31, 2013;
b)
in the case of the consolidated statement of profit and loss, of the profit of the L&T Group for the year ended on that date; and
c)
in the case of the consolidated cash flow statement, of the cash flows of the L&T Group for the year ended on that date.
Other matters
In respect of the financial statements of a subsidiary, we carried out the audit jointly with other auditor. The details of assets, revenues and
net cash flows in respect of the subsidiary to the extent to which they are reflected in the consolidated financial statements are given below:
Jointly audited :
crore
crore
crore
Total assets
Total revenues Net cash inflows / (outflows)
Indian subsidiary
418.83
140.57
(0.34)
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 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, revenues and net cash flows in respect of these subsidiaries and joint ventures and the net carrying cost of investment
222
and current year share of net profit 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:
crore
crore
crore
Total assets
Total revenues
Net cash inflows / (outflows)
A
B
C
Indian subsidiaries
Foreign subsidiaries
Joint ventures
32549.44
5260.25
2089.08
2552.03
3961.34
382.53
111.89
(40.16)
64.02
Net carrying cost of
investment
Current year
share of net profit
D Associates
68.66
4.33
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, 2013, 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, revenues and net cash flows in respect of these subsidiaries and joint ventures and the net carrying cost of investment
and current year/period share of net profit in respect of these associates, to the extent to which they are reflected in the consolidated
financial statements are given below:
Certified by management :
crore
crore
crore
Total assets
Total revenues
Net cash inflows / (outflows)
A
B
C
Indian subsidiaries
Foreign subsidiaries
Joint ventures
103.15
0.60
112.14
16.33
2.92
180.62
3.60
(1.12)
0.22
D Associates
56.31
6.29
Our opinion is not qualified in respect of these matters.
Net carrying cost of
investment
Current year/period
share of net profit
Mumbai, May 22, 2013
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
MILIND P. PHADKE
Partner
Membership No.33013
223
Consolidated Balance Sheet as at March 31, 2013
EQUITY AND LIABILITIES:
Shareholders’ funds
Share capital
Reserves and surplus
Minority interest
Non-current liabilities
Long term borrowings
Deferred payment liabilities for acquisition of fixed assets
Deferred tax liabilities (net)
Other long term liabilities
Long term provisions
Current liabilities
Short term borrowings
Current maturities of deferred payment liabilities for acquisition
of fixed assets
Current maturities of long term borrowings
Trade payables
Other current liabilties
Short term provisions
TOTAL
ASSETS:
Non-current assets
Fixed assets
Tangible assets
Intangible assets
Capital work-in-progress
Intangible assets under development
Goodwill on consolidation
Current assets
Non-current investments
Deferred tax assets (net)
Long term loans and advances
Long term loans and advances towards financing activities
Cash and bank balances
Other non-current assets
Current investments
Inventories
Trade receivables
Cash and bank balances
Short term loans and advances
Short term Loans and advances towards financing activities
Other current assets
TOTAL
CONTINGENT LIABILITIES
COMMITMENT (capital and others)
OTHER NOTES FORMING PART OF THE ACCOUNTS
SIGNIFICANT ACCOUNTING POLICIES
As per our report attached
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
Mumbai, May 22, 2013
224
N. HARIHARAN
Company Secretary
As at 31-3-2013
As at 31-3-2012
Note
crore
crore
crore
crore
33859.69
2652.87
29386.78
1753.46
122.48
29264.30
36656.42
3953.58
210.88
842.38
312.19
52717.18
41975.45
5256.36
464.09
5237.30
17401.23
15495.26
2341.37
53875.31
143105.05
46195.61
119311.30
41740.00
1262.95
194.20
2200.47
21839.90
59.65
114.62
34316.47
1564.87
129.04
2043.96
16605.10
143.56
101.76
14116.20
4233.15
8056.20
6857.03
1053.89
7224.62
4228.16
20651.10
3378.58
5429.54
8168.82
15325.72
75693.26
143105.05
64406.54
119311.30
A
B
123.08
33736.61
C(I)
Q(22)
Q(15)
C(II)
C(III)
47400.16
3481.45
377.87
1114.12
343.58
D(I)
7287.86
Q(22)
D(II)
D(III)
D(IV)
D(V)
472.53
7305.70
18812.03
17457.81
2539.38
20860.52
7452.92
4017.49
7289.32
2119.75
7504.55
5169.47
23014.91
3571.54
6251.84
10162.21
20018.74
E(I)
E(II)
E(I)
E(II)
E(III)
F
Q(15)
G(I)(a)
G(I)(b)
G(II)
G(III)
H(I)
H(II)
H(III)
H(IV)
H(V)
H(V)(a)
H(VI)
I
J
Q
R
A. M. NAIK
Group Executive Chairman
K. VENKATARAMANAN
Chief Executive Officer &
Managing Director
R. SHANKAR RAMAN
Chief Financial Officer &
Whole-time Director
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
A. K. JAIN
M. DAMODARAN
SUSHOBHAN SARKER
Directors
Mumbai, May 22, 2013
Consolidated Statement of Profit and Loss for the year ended March 31, 2013
REVENUE:
Revenue from operations (gross)
Less: Excise duty
Revenue from operations (net)
Other income
Total revenue
EXPENSES:
Manufacturing, construction and operating expenses
Cost of raw materials, components consumed
Construction materials consumed
Purchase of stock-in-trade
Stores, spares and tools consumed
Sub-contracting charges
Value of stock transferred on disposal of subsidiary/business
Changes in inventories of finished goods, work-in-progress and stock-in-trade
Other manufacturing, construction and operating expenses
Finance cost of financial services business
Staff expenses for software development business
Employee benefits expense
Sales, administration and other expenses
Finance costs
Depreciation, amortisation, impairment and obsolescence
Less: Transfer from revaluation reserve
Less: Overheads charged to fixed assets
Total expenses
Profit before exceptional and extraordinary items and tax
Exceptional items
Profit before extraordinary items and tax
Extraordinary items
Profit before tax
Tax expense:
Current tax
Deferred tax (net)
Profit after tax
Less: Additional tax on dividend distributed/proposed by subsidiary companies
Add: Share in profit/(loss) (net) of associate companies
Add/(less): Minority interest in (income)/losses
Balance carried to Balance Sheet
Basic earnings per equity share before extraordinary items ( )
Diluted earnings per equity share before extraordinary items ( )
Basic earnings per equity share after extraordinary items ( )
Diluted earnings per equity share after extraordinary items ( )
Face value per equity share ( )
OTHER NOTES FORMING PART OF THE ACCOUNTS
SIGNIFICANT ACCOUNTING POLICIES
}
As per our report attached
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
Mumbai, May 22, 2013
N. HARIHARAN
Company Secretary
2012-13
Note
crore
crore
2011-12
crore
crore
K
L
M
N
O
P
Q(5)
Q(6)
Q(8)
Q(15)
Q(14)
Q
R
75195.31
697.31
64960.08
646.97
74498.00
1095.93
75593.93
64313.11
828.97
65142.08
10790.24
15562.64
2179.87
2705.02
14322.47
(51.23)
(1514.33)
6132.88
2350.16
2215.23
1651.71
14.64
2241.79
143.75
10863.96
13037.00
2456.02
2184.29
10969.25
(15.33)
(598.76)
4653.56
1664.12
1876.38
1581.28
0.99
2314.33
(31.78)
47090.49
4998.23
3368.44
1215.85
1580.29
58253.30
27.96
58225.34
6916.74
56.77
6973.51
-
6973.51
2282.55
4690.96
8.67
4682.29
46.16
4728.45
(34.76)
4693.69
76.81
76.08
76.81
76.08
2.00
54692.95
6224.17
3772.23
2095.02
1637.07
68421.44
50.56
68370.88
7223.05
336.76
7559.81
78.11
7637.92
2385.54
5252.38
12.96
5239.42
38.43
5277.85
(72.18)
5205.67
83.63
82.94
84.79
84.10
2.00
A. M. NAIK
Group Executive Chairman
K. VENKATARAMANAN
Chief Executive Officer &
Managing Director
R. SHANKAR RAMAN
Chief Financial Officer &
Whole-time Director
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
A. K. JAIN
M. DAMODARAN
SUSHOBHAN SARKER
Directors
Mumbai, May 22, 2013
225
Consolidated Cash Flow Statement for the year ended March 31, 2013
A. Cash flow from operating activities:
Profit before tax (excluding minority interest, exceptional and extraordinary items)
Adjustments for:
Dividend received
Depreciation, amortisation, impairment and obsolescence
Exchange difference on items grouped under financing/investing activity
Expenditure on voluntary retirement scheme
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 trade payables and customer advances
Cash generated from operations before financing activities
(Increase)/decrease in loans and advances towards financing activities
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 associate companies and third parties (net)
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 subsidiaries
Cash (used in)/from investing activities
Extraordinary item
Cash received (net of expenses) on sale of medical business
Net cash (used in)/from investing activities (after extraordinary items)
B.
C.
Cash flow from financing activities:
Proceeds from issue of share capital
Proceeds from long term borrowings
Repayment of long term borrowings
Proceeds from other borrowings (net)
Payment (to)/from minority interest (net)
Dividends paid
Additional tax on dividend
Interest paid (including cash flows on account of interest rate swaps)
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
2012-13
crore
7223.05
(68.65)
1637.07
302.87
(38.34)
2095.02
(489.55)
(202.22)
(292.54)
99.21
(9.85)
10256.07
(7284.76)
(675.81)
2358.53
4654.03
(5882.45)
(1228.42)
(2531.72)
(3760.14)
(7832.32)
394.55
(273.17)
984.04
(263.06)
(84.82)
520.08
4.61
68.65
292.98
(1116.27)
355.24
(14.41)
(6963.90)
52.36
(6911.54)
163.14
18760.13
(6829.16)
1909.49
803.27
(1012.79)
(187.98)
(2825.37)
10780.73
109.05
3522.14
3631.19
2011-12
crore
6916.74
(145.41)
1580.29
333.52
–
1215.85
(487.92)
(12.31)
(180.86)
205.27
(4.70)
9420.47
(9535.91)
(448.75)
4251.53
3687.34
(7062.53)
(3375.19)
(2851.58)
(6226.77)
(7302.38)
198.44
(429.52)
644.64
437.98
(91.44)
464.37
25.35
145.41
42.97
–
–
–
(5864.18)
–
(5864.18)
192.63
18794.88
(8343.81)
3201.32
1441.69
(886.19)
(176.52)
(2256.35)
11967.65
(123.30)
3645.44
3522.14
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.
Purchase of fixed assets includes movement of capital work-in-progress during the year.
2.
3. Cash and cash equivalents at the end of the year represent cash and bank balances and include unrealised gain of 27.61 crore (previous year: unrealised gain of 70.81
crore) on account of translation of foreign currency bank balances.
For cash and cash equivalents not available for immediate use as on the Balance Sheet date, see Note G(II) & Note H(IV).
4.
5. Cash and cash equivalents are reflected in the Balance Sheet as follows:
(a) Cash and cash equivalents disclosed under current assets [Note H(IV)]
(b) Cash and cash equivalents disclosed under non-current assets [Note G(II)]
Total cash and cash equivalents as per Cash Flow Statement
6.
Previous year’s figures have been regrouped/reclassified wherever applicable.
2012-13
crore
3571.54
59.65
3631.19
2011-12
crore
3378.58
143.56
3522.14
A. M. NAIK
Group Executive Chairman
K. VENKATARAMANAN
Chief Executive Officer &
Managing Director
S. RAJGOPAL
N. MOHAN RAJ
M. DAMODARAN
R. SHANKAR RAMAN
Chief Financial Officer &
Whole-time Director
M. M. CHITALE
A. K. JAIN
SUSHOBHAN SARKER
N. HARIHARAN
Company Secretary
Directors
Mumbai, May 22, 2013
As per our report attached
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
Mumbai, May 22, 2013
226
Notes forming part of the Consolidated Accounts
NOTE [A]
Share capital
A(I) Share capital authorised, issued, subscribed and paid up:
Particulars
Authorised:
Equity shares of 2 each
Issued, subscribed and fully paid up:
Equity shares of 2 each
As at 31-3-2013
As at 31-3-2012
Number of
shares
crore
Number of
shares
crore
1,62,50,00,000
325.00 1,62,50,00,000
325.00
61,53,85,981
123.08
61,23,98,899
122.48
A(II) Reconciliation of the number of equity shares and share capital:
Particulars
Issued, subscribed and fully paid up equity shares outstanding
at the beginning of the year
Add: Shares issued on exercise of employee stock options
during the year
Issued, subscribed and fully paid up equity shares outstanding
at the end of the year
A(III) Terms/rights attached to equity shares:
As at 31-3-2013
As at 31-3-2012
Number of
shares
crore
Number of
shares
crore
61,23,98,899
122.48
60,88,52,126
121.77
29,87,082
0.60
35,46,773
0.71
61,53,85,981
123.08
61,23,98,899
122.48
The Company has only one class of share capital, i.e. equity shares having face value of 2 per share. Each holder of equity share is
entitled to one vote per share.
A(IV) Shareholders holding more than 5% of equity shares as at the end of the year:
Name of the shareholder
Life Insurance Corporation of India
L&T Employees Welfare Foundation
Administrator of the Specified Undertaking of the
Unit Trust of India
As at 31-3-2013
As at 31-3-2012
Number of
shares
10,12,52,038
7,44,04,116
5,06,17,308
Shareholding
%
16.45
12.09
8.23
Number of
shares
11,04,05,734
7,44,04,116
5,05,72,216
Shareholding
%
18.03
12.15
8.26
A(V) Shares reserved for issue under options outstanding as at the end of the year on un-issued share capital:
Particulars
Employee stock options granted and outstanding #
3.5% 5 years & 1 day US$ denominated foreign currency
convertible bonds (FCCB)
As at 31-3-2013
As at 31-3-2012
Number of
equity shares to
be issued as
fully paid
87,45,451 @
49,07,243
crore
(At face value)
Number of
equity shares to
be issued as
fully paid
1.75 * 1,14,28,854 @
0.98 ** 49,07,243
crore
(At face value)
2.29 *
0.98 **
The equity shares will be issued at a premium of 491.96 crore (previous year: 640.32 crore)
*
** The equity shares will be issued at a premium of 935.42 crore (previous year: 935.42 crore) on the exercise of options by the
bond holders
Note A(VIII) for terms of employee stock option schemes
The number of options have been adjusted consequent to bonus issue wherever applicable
#
@
227
Notes forming part of the Consolidated Accounts (contd.)
A(VI) The aggregate number of equity shares allotted as fully paid up by way of bonus shares in immediately preceding five years ended
March 31, 2013 are 29,25,92,054 (previous period of five years ended March 31, 2012: 29,25,92,054 shares)
A(VII) The aggregate number of equity shares issued pursuant to contract, without payment being received in cash in immediately preceding
five years ended March 31, 2013 – Nil (previous period of five years ended March 31, 2012: Nil)
A(VIII) Stock option schemes
a) Terms:
i.
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 4 years [5 years in the case of series 2006(A)], subject to
the discretion of the management and fulfillment of certain conditions.
ii. Options can be exercised anytime within a period of 7 years from the date of grant and would be settled by way of equity.
Management has discretion to modify the exercise period.
b) The details of the grants under the aforesaid schemes under various series are summarised below:
Sr.
No.
Series reference
1 Grant price ( )
2 Grant dates
3
Vesting commences on
4 Options granted and outstanding
at the beginning of the year
5 Options lapsed during the year
6 Options granted during the year
7 Options exercised during the year
8 Options granted and outstanding
2000
2002 (A)
2002 (B)
2003 (A)
2003 (B)
2006
2006 (A)
2012-13 2011-12 2012-13 2011-12 2012-13 2011-12 2012-13 2011-12 2012-13 2011-12 2012-13 2011-12 2012-13 2011-12
3.50
3.50
3.50
3.50
3.50
3.50
17.50
17.50
17.50
17.50
601.00
601.00
601.00
601.00
1-6-2000
1-6-2001
19-4-2002
19-4-2003
19-4-2002
23-5-2003 onwards
23-5-2003 onwards
1-9-2006 onwards
1-7-2007 onwards
19-4-2003
23-5-2004 onwards
23-5-2004 onwards
1-9-2007 onwards
1-7-2008 onwards
16,800
16,800
21,500
21,500
39,700
39,700
31,452
31,452 6,47,302 9,32,880 20,26,751 39,74,443 86,45,349 89,36,534
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
62,150
56,711
42,513
89,849 7,81,908 8,17,452
– 1,18,000 1,18,400
–
– 10,72,250 18,67,930
– 2,67,950 3,47,267 10,72,770 18,57,843 16,46,362 13,41,663
at the end of the year
16,800
16,800
21,500
21,500
39,700
39,700
31,452
31,452 4,35,202 6,47,302 9,11,468 20,26,751 72,89,329 86,45,349
of which –
Options vested
Options yet to vest
9 Weighted average
remaining
contractual life of options (in years)
16,800
16,800
21,500
21,500
39,700
39,700
31,452
31,452 1,09,802 1,04,202 9,11,468 20,11,951 21,35,578 17,51,546
–
Nil
–
Nil
–
Nil
–
Nil
–
Nil
–
Nil
–
Nil
– 3,25,400 5,43,100
-
14,800 51,53,751 68,93,803
Nil
5.12
4.87
1.51
1.51
4.39
4.85
c)
The number and weighted average exercise price of stock options for the following group of options are as follows:
2012-13
2011-12
Particulars
No. of stock
options
(i) Options granted and outstanding at the beginning of the year
(ii) Options granted during the year
(iii) Options allotted during the year
(iv) Options lapsed during the year
(v) Options granted and outstanding at the end of the year
(vi) Options exercisable at the end of the period out of (v) supra
1,14,28,854
11,90,250
29,87,082
8,86,571
87,45,451
32,66,300
Weighted
average
exercise price
( )
562.27
543.15
548.66
560.10
564.54
561.50
No. of stock
options
1,39,53,309
19,86,330
35,46,773
9,64,012
1,14,28,854
39,77,151
Weighted
average
exercise price
( )
557.33
566.22
543.87
566.67
562.27
569.38
d) Weighted average share price at the date of exercise for stock options exercised during the period is 1452.14 (previous year:
1540.11) per share.
e)
In respect of stock options granted pursuant to the Company’s 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
over the vesting period.
228
Notes forming part of the Consolidated Accounts (contd.)
f) Had fair value method been adopted for expensing the compensation arising from employee share-based payment plans:
a.
The employee compensation charge debited to the Statement of Profit and Loss for the year 2012-13 would have been
higher by 32.15 crore (previous year: 30.78 crore).
b. Basic EPS before extraordinary items would have decreased from 83.63 per share to 83.10 per share.
c.
Basic EPS after extraordinary items would have decreased from 84.79 per share to 84.27 per share.
d. Diluted EPS before extraordinary items would have decreased from 82.94 per share to 82.42 per share.
e. Diluted EPS after extraordinary items would have decreased from 84.10 per share to 83.58 per share.
g) Weighted average fair values of options granted during the year is 909.35 (previous year: 745.94) per option.
h)
The fair value has been calculated using the Black-Scholes Option Pricing Model and the significant assumptions and inputs to
estimate the fair value of options granted during the year are as follows:
Sr.
no.
Particulars
(i) Weighted average risk-free interest rate
(ii) Weighted average expected life of options
(iii) Weighted average expected volatility
2012-13
2011-12
8.05%
4.26 years
39.38%
8.28%
4.33 years
41.09%
(iv) Weighted average expected dividends over the life of the option
70.24 per option
62.84 per option
(v) Weighted average share price
(vi) Weighted average exercise price
(vii) Method used to determine expected volatility
1317.81 per option
1146.53 per option
543.15 per share
566.22 per share
Expected volatility is based on the historical
volatility of the Company’s share price applicable
to the total expected life of each option.
A(IX) The Directors recommend payment of final dividend of 18.50 per equity share of 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 61,53,85,981equity shares outstanding
as at March 31, 2013 amounting to 1138.47 crore.
A(X) Stock ownership schemes of subsidiary companies:
a)
Employee Stock Ownership Scheme (‘ESOS Plan’)
Under the Employee Stock Ownership Scheme (ESOS), 25,48,200 options are outstanding as at March 31, 2013. 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 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:
Sr.
No.
1
2
3
4
5
6
Series reference
Grant Price ( )
I, II & III
IV – XX
2012-13
2011-12
2012-13
2011-12
25.00
25.00
10.00
10.00
Options granted and outstanding at the beginning of the year
3,93,003
3,93,003
21,79,953
22,03,092
Options granted during the year
Options cancelled/lapsed during the year
Options exercised and shares allotted during the year
–
–
–
–
–
–
–
–
24,756
23,139
–
–
Options granted and outstanding at the end of the year
3,93,003
3,93,003
21,55,197
21,79,953
of which -
Options vested
Options yet to vest
3,93,003
3,93,003
9,70,917
9,70,917
–
–
11,84,280
12,09,036
229
Notes forming part of the Consolidated Accounts (contd.)
b)
Employees Stock Ownership Scheme–2006 U.S. Stock Option Sub-Plan (‘Sub-Plan’)
One of the subsidiaries of the Company has instituted the Employees Stock Ownership Scheme–2006 U.S. Stock Option Sub-Plan
(‘Sub-Plan’) for the employees and directors of its foreign subsidiary. 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 fulfillment 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 5 each
at an exercise price of USD 12 per share. Under the said plan, options granted and outstanding as at the end of the year are
90,100 options, all vested.
Employees Stock Options granted and outstanding as at the end of the year on unissued share capital represent options 26,38,300
(previous year: 26,63,056)
c)
Employee Stock Option Plan 2008 (ESOP 2008)
The Employee Stock Option Plan 2008 of one of the domestic subsidiaries of the Company is designed to provide stock options
to employees in a specific category. All grants under the plan are to be issued and allotted by the Allotment Committee of the
Board of the said subsidiary. The options are to be granted to the eligible employees based on certain criteria and approval of
the Allotment Committee of the Board and as per the detailed and respective Employee Stock Option Agreements that the said
subsidiary enters into with them.
The options have been granted on September 10, 2009. Options have been granted at an exercise price equal to the fair market
value of the shares as determined by an independent valuer.
The employees shall be allotted a pre-defined number of equity shares against each option and the options will vest over a
period of five years from the date of grant at a pre-defined percentage of the total vesting, which shall each be subject to the
condition that the employees will secure specific annual performance ratings for every allotment and Company achieving certain
performance target and vesting of shares can be carried forward to maximum 2 years.
Options can be exercised anytime within a period of 5 years from the date of vesting. The employees also have the exit option
which they can exercise under certain events.
Summary of Stock Options
2012-13
2011-12
No. of stock
options
Weighted
average
exercise price
( )
No. of stock
options
Weighted
average
exercise price
( )
Options granted and outstanding at the beginning of the year
3,20,000
10.50
65,40,000
10.50
Options granted during the year
–
–
–
–
Options forfeited/lapsed during the year
2,60,000
10.50
62,20,000
10.50
Options exercised during the year
–
–
–
–
Options granted and outstanding at the end of the year of
which -
60,000
10.50
3,20,000
10.50
Options vested
Options yet to vest
Weighted average remaining contractual life of options
(comprising the vesting period and the exercise period) (in
years)
–
60,000
6.33
–
–
–
3,20,000
7.08
Since the options have been granted at an exercise price equal to the fair market value of the shares as determined by an
independent valuer there is no charge to the Statement of Profit and Loss.
230
Notes forming part of the Consolidated Accounts (contd.)
d)
Stock option scheme
One of the domestic subsidiaries of the Company has formulated Employee Stock Option Scheme 2010 (ESOP Scheme-2010) and
2010-A (ESOP Scheme 2010-A).The grant of options to the employee under the Stock Options scheme is on the basis of their
performance and other eligibility criteria. The options are vested over a period of 4 years in ratio of 15%, 20%, 30% and 35%
respectively from the date of grant, subject to the discretion of the management and fulfillment of certain conditions.Options
can be exercised anytime within a period of 7 years from the date of grant and would be settled by way of equity. Management
has discretion to modify the exercise period.
The details of the grant under the aforesaid scheme are summarised below:
Series reference
Sr.
No.
Grant price ( )
Grant date
Vesting commence on
1
2
3
4
5
6
7
8
2010
2010-A
2012-13
2011-12
2012-13
2011-12
44.20
44.20
44.20
44.20
November 30, 2010 onwards
July 4, 2012
November 30, 2011
July 4, 2013
Options granted and outstanding at the beginning of the year
1,35,72,440
1,06,15,400
–
Options granted during the year
–
47,10,500
9,05,000
Options cancelled/lapsed during the year
13,52,565
17,21,635
Options exercised during the year
19,98,920
31,825
–
–
Options granted and outstanding at the end of the year of which –
1,02,20,955
1,35,72,440
9,05,000
Options vested
Options yet to vest
14,98,419
13,50,666
–
87,22,536
1,22,21,774
9,05,000
–
–
–
–
–
–
–
–
9 Weighted average remaining contractual life of options (in years)
1.67
2.67
3.33
Weighted average fair values of options granted during the year is 15.37 (previous year: 28.18) per option.
The fair value has been calculated using the Black-Scholes Option Pricing Model and the significant assumptions and inputs to
estimate the fair value of options granted during the year are as follows:
Sr.
No.
Particulars
2012-13
2011-12
a) Weighted average risk-free interest rate
b) Weighted average expected life of options
c) Weighted average expected volatility
8.17%
8.30%
3.68 years
3.63 years
33.82%
41.81%
d) Weighted average expected dividends
1.84 per option
0.75 per option
e) Weighted average share price
f) Weighted average exercise price
g) Method used to determine expected volatility
44.30 per option
60.42 per option
44.20 per share
51.357 per share
Expected volatility is based on the
historical volatility of the Company’s
shares price applicable to the expected
life of each option.
231
Notes forming part of the Consolidated Accounts (contd.)
NOTE [B]
Reserves and surplus
Particulars
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
Capital reserve
As per last Balance Sheet
Addition during the year
Capital reserve on consolidation
As per last Balance Sheet
Addition during the year
Capital redemption reserve
As per last Balance Sheet
Securities premium account [Note Q(8)(b)]
As per last Balance Sheet
Addition during the year
Less: Share/bond issue expenses (net of tax)
Reversal of recoveries credited in previous years
Debenture redemption reserve
As per last Balance Sheet
Less: Transferred to retained earnings
Add: Transferred from retained earnings
Revaluation reserve
As per last Balance Sheet
Addition during the year
Less: On asset sold or obsoleted during the year
Less: Transferred to statement of profit and loss
Share options outstanding account
Employee share options outstanding account
As per last Balance Sheet
Addition during the year
Deduction during the year
Deferred employee compensation expense
As per last Balance Sheet
Addition during the year
Deduction during the year
Carried forward
232
833.30
110.29
15.52
130.26
3.27
7206.36
309.04
7515.40
0.57
2.72
651.00
321.00
98.46
24.57
10.27
–
14.64
767.99
92.54
218.92
(284.81)
(92.54)
182.66
46.66
786.64
943.59
833.30
15.52
3.27
145.78
3.27
14.31
1.21
3.27
6879.37
327.32
7206.69
–
0.33
7512.11
7206.36
456.51
–
194.49
428.46
651.00
29.65
–
4.09
0.99
20.20
24.57
861.41
119.46
212.88
641.61
767.99
(447.56)
(119.46)
282.21
(194.69)
9500.33
(284.81)
9217.20
Notes forming part of the Consolidated Accounts (contd.)
NOTE [B]
Reserves and surplus (contd.)
Particulars
Brought forward
Reserve u/s 45 IC of the RBI Act, 1934
As per last Balance Sheet
Add: Transferred from retained earnings
Reserve u/s 29C of National Housing Bank Act, 1987
As per last Balance Sheet
Add: Transferred from retained earnings
Tonnage tax reserve
As per last Balance Sheet
Add: Transferred from retained earnings
Foreign currency translation reserve
As per last Balance Sheet
Addition during the year (net)
Less: Transferred to Statement of Profit and Loss on
divestment of stake in subsidiaries
Reserve u/s 36(1)(viii) of Income Tax Act, 1961
As per last Balance Sheet
Add: Transferred from retained earnings
Hedging reserve (net of tax) [Note Q(15)]
As per last Balance Sheet
Less: Transferred from retained earnings
Addition/(deduction) during the year
Retained earnings
As per last Balance Sheet
Profit for the year
Add/(less): Transferred from/(to):
Debenture redemption reserve
Reserve u/s 45 IC of the RBI Act, 1934
Reserve u/s 29C of National Housing Bank Act, 1987
Tonnage tax reserve
Reserve u/s 36(1)(viii) of Income Tax Act, 1961
Hedging reserve
Other appropriation:
Dividend paid for previous year
Additional tax on dividend paid for previous year
Proposed dividend
Additional dividend tax [Note Q(21)]
Less:
As at 31-3-2013
As at 31-3-2012
crore
360.40
197.28
–
0.04
4.48
0.02
296.35
130.16
9.52
46.86
92.26
(581.79)
–
(29.91)
19920.80
5205.67
25126.47
222.54
(197.28)
(0.04)
(0.02)
(92.26)
–
2.33
0.38
1138.47
188.58
crore
9500.33
crore
crore
9217.20
252.89
107.51
557.68
360.40
0.04
4.50
416.99
–
–
4.48
–
82.11
214.24
–
21.53
25.33
–
4.48
296.35
139.12
46.86
(7.96)
0.60
(573.23)
(611.70)
(581.79)
16732.11
4693.69
21425.80
(194.49)
(107.51)
–
–
(25.33)
0.60
3.35
0.54
1010.46
163.92
23729.65
33736.61
19920.80
29264.30
233
Notes forming part of the Consolidated Accounts (contd.)
NOTE [C(I)]
Long term borrowings
Particulars
Secured Unsecured
Total *
Secured Unsecured
Total *
As at 31-3-2013
As at 31-3-2012
Redeemable non-convertible fixed rate debentures
Redeemable non-convertible floating rate debentures
3.50% Foreign currency convertible bonds
Term loans from banks
Term loans from others
Loans from financial institutions
Sales tax deferment loan
Long term maturities of finance lease obligations
[Note Q(13)(ii)(a)(ii)]
Refinance from National Housing Bank
Perpetual debt
* Loans guaranteed by directors Nil (previous year: Nil)
NOTE [C(II)]
Other long term liabilities
Forward contract payable
Interest accrued but not due
Others [Note C(II)(a)]
Particulars
crore
8515.42
100.00
–
23596.53
330.08
742.56
–
–
crore
2966.04
–
1085.70
8772.59
1082.03
–
8.25
0.25
crore
11481.46
100.00
1085.70
32369.12
1412.11
742.56
8.25
0.25
crore
5648.13
100.00
–
22390.97
300.10
461.09
–
–
crore
crore
6523.13
875.00
100.00
–
1017.50
1017.50
5449.81 27840.78
697.89
461.09
15.54
0.49
397.79
–
15.54
0.49
0.71
–
–
200.00
0.71
200.00
–
–
–
–
–
–
33285.30
14114.86
47400.16
28900.29
7756.13 36656.42
As at 31-3-2013
As at 31-3-2012
crore
603.08
340.01
171.03
1114.12
crore
542.79
115.71
183.88
842.38
C(II)(a) Other long term liabilities–others include
Advance received against sale of investments represents advance of 14.30 crore received from M/s. Sical Logistics Limited against sale
of 1,43,00,000 equity shares of
10 each in M/s. Sical Iron Ore Terminals Limited at cost to M/s.Sical Logistics Limited vide agreement
for share sale and purchase dated December 17, 2008. The sale is subject to the condition that it can be completed only after three years
from the date of commencement of commercial operation by M/s. Sical Iron Ore Terminals Limited as per clause 18.2.2 (i) (d) of the license
agreement dated September 23, 2006 between M/s. Sical Iron Ore Terminals Limited and M/s. Ennore Port Limited. As of March 31, 2013,
M/s. Sical Iron Ore Terminals Limited is yet to commence commercial operations.
NOTE [C(III)]
Long term provisions
Particulars
Provision for employee benefits:
Employee pension schemes [Note Q(10)(ii)(a)]
Post-retirement medical benefit plan [Note Q(10)(ii)(a)]
Interest rate guaranteed-provident fund [Note Q(10)(ii)(a)]
Others:
Periodic major maintenance (AS 29 related) [Note Q(18)]
234
As at 31-3-2013
As at 31-3-2012
crore
186.38
102.70
0.69
53.81
343.58
crore
174.19
83.43
20.61
33.96
312.19
Notes forming part of the Consolidated Accounts (contd.)
NOTE [D(I)]
Short term borrowings
Particulars
Secured Unsecured
Total*
Secured Unsecured
Total*
crore
crore
crore
crore
crore
crore
As at 31-3-2013
As at 31-3-2012
Loans repayable on demand:
From banks
Other loans and advances:
From banks
Commercial paper
Loans from related parties
From others
1637.58
286.08
1923.66
710.38
108.94
819.32
988.57
670.42
1658.99
1119.89
3079.14
4199.03
–
–
–
3404.47
3404.47
30.00
30.00
–
–
270.74
270.74
11.96
108.15
108.15
30.00
87.90
30.00
99.86
2626.15
4661.71
7287.86
1842.23
3414.13
5256.36
* Loans guaranteed by directors Nil (previous year: Nil)
NOTE [D(II)]
Current maturities of long term borrowings
Particulars
Secured Unsecured
Total*
Secured Unsecured
Total*
crore
crore
crore
crore
crore
crore
As at 31-3-2013
As at 31-3-2012
Redeemable non-convertible fixed rate debentures
1428.50
349.00
1777.50
1030.00
250.00
1280.00
Term loans from banks
Loans from financial institutions
Refinance from National Housing Bank
Sales tax deferment loan
Finance lease obligation [Note Q(13)(ii)(a)(ii)]
4118.15
1351.23
5469.38
1772.08
2143.60
3915.68
50.34
0.93
–
–
–
–
7.29
0.26
50.34
18.40
0.93
7.29
0.26
–
–
–
–
–
22.90
0.32
18.40
–
22.90
0.32
5597.92
1707.78
7305.70
2820.48
2416.82
5237.30
* Loans guaranteed by directors Nil (previous year: Nil)
NOTE [D(III)]
Trade payables
Acceptances
Due to related parties:
Associate Companies
Micro and small enterprises
Due to others
Particulars
As at 31-3-2013
As at 31-3-2012
crore
609.42
45.61
91.60
18065.40
18812.03
crore
182.26
202.22
84.48
16932.27
17401.23
235
Notes forming part of the Consolidated Accounts (contd.)
NOTE [D(IV)]
Other current liabilities
Particulars
Interest accrued but not due on borrowings
Interest accrued and due on borrowings
Unclaimed dividend
Unclaimed interest on debentures
Unclaimed matured deposits
Due to customers (construction and project related activity)
Advances from customers
Other payables (including sales tax,service tax,excise duty and others)
[Note D(IV)(a)]
As at 31-3-2013
As at 31-3-2012
crore
574.08
16.27
23.85
7.96
–
4416.97
8500.53
3918.15
crore
312.93
8.67
19.52
1.58
0.01
3016.21
9152.07
2984.27
17457.81
15495.26
D(IV)(a) Other current liabilities–other payables include
(i) Advance received against sale of investments represents advance received from M/s. JRE Tank Terminals Private Limited (JRETTPL) under
an agreement dated August 24, 2007 towards sale of 67,87,500 equity shares of 10 each at cost in M/s. Ennore Tank Terminals Private
Limited (ETTPL) to be transferred on completion of three calendar years from the date of commencement of commercial operations.
The said project has commenced commercial operations on January 15, 2009. The Company has initiated the share transfer process
and it is expected to be completed in 2013-14 once the approval of M/s. Ennore Port Limited is obtained by JRETTPL.
(ii) Provision for commission to directors 40.80 crore (previous year: 42.08 crore)
NOTE [D(V)]
Short term provisions
Particulars
Provision for employee benefits:
Gratuity [Note Q(10)(ii)(a)]
Compensated absences
Employee pension schemes [Note Q(10)(ii)(a)]
Post-retirement medical benefit plan [Note Q(10)(ii)(a)]
Bonus provision
Others:
Current taxes [net of payments made 1822.78 crore
(previous year: 99.85 crore)]
Proposed dividend [Note A(IX)]
Additional tax on dividend
Reserve for unexpired risks
Other provisions (AS 29 related) [Note Q(18)]
236
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
70.01
565.28
11.98
15.00
22.12
32.26
1138.47
136.52
86.71
461.03
45.99
471.89
9.84
9.21
20.64
684.39
557.57
24.11
1010.46
123.35
53.77
572.11
1854.99
2539.38
1783.80
2341.37
Notes forming part of the Consolidated Accounts (contd.)
Cost/valuation
Depreciation
Impairment
Book value
crore
NOTE [E(I)]
Tangible assets
Particulars
Land
Freehold
Leasehold
Sub total - Land
Buildings
Owned
Leased out
Sub total - Building
Plant & equipment
Pursuant to
acquisition of
subsidiaries
As at
1-4-2012
1135.70
797.96
1933.66
3427.36
442.83
3870.19
Owned
Leased out
8745.12
567.66
Sub total - Plant & equipment 9312.78
Computers
Owned
Leased out
Taken on lease
Sub total - Computers
Office equipment
734.22
59.88
2.82
796.92
Owned
Leased out
Sub total - Office equipment
Furniture and fixtures
Owned
Leased out
Sub total - Furniture & fixtures
Vehicles
Owned
Leased out
Taken on lease
Sub total - Vehicles
Other assets
Owned
Railway sidings
Aircraft
Ships
Dredged channel
Breakwater structures
Sub total - Other assets
Lease adjustment
Total
333.49
0.79
334.28
447.82
18.06
465.88
343.44
178.50
0.91
522.85
313.37
129.70
790.16
378.90
–
1612.13
Foreign
currency
fluctuation
Deductions
As at
31-3-2013
Up to
31-3-2012
Pursuant to
acquisition of
subsidiaries
1.25
3.10
4.35
20.64
–
20.64
38.03
–
38.03
2.01
–
–
2.01
2.94
–
2.94
3.51
–
3.51
4.88
–
–
4.88
–
–
–
–
–
–
91.94
22.71
114.65
109.26
–
109.26
152.12
28.70
180.82
27.47
13.36
0.37
41.20
6.57
0.08
6.65
32.72
0.02
32.74
22.78
46.16
0.91
69.85
–
10.62
–
–
–
10.62
1096.08
946.81
2042.89
5009.02
866.96
5875.98
–
35.17
35.17
432.09
25.51
457.60
12045.07
543.39
12588.46
2624.43
227.39
2851.82
895.42
46.88
2.58
944.88
413.87
0.72
414.59
520.13
18.30
538.43
419.93
206.67
–
626.60
318.84
119.08
1670.50
1135.57
656.93
3900.92
420.22
33.70
2.81
456.73
167.13
0.15
167.28
203.88
3.09
206.97
155.91
52.30
0.91
209.12
13.70
13.27
77.66
11.41
–
116.04
–
–
–
12.67
–
12.67
55.85
–
55.85
22.72
–
–
22.72
9.28
–
9.28
9.45
–
9.45
2.40
–
–
2.40
–
–
–
–
–
–
Additions
46.70
168.46
215.16
1632.37
424.13
2056.50
3335.09
4.43
3339.52
160.53
0.36
0.13
161.02
72.36
0.01
72.37
89.49
0.26
89.75
91.26
74.33
–
165.59
5.47
–
880.34
756.67
656.93
2299.41
For the
year
–
17.62
17.62
119.78
6.45
126.23
853.95
14.45
868.40
120.58
7.30
0.04
127.92
49.13
0.09
49.22
49.05
1.40
50.45
50.64
28.84
–
79.48
15.14
6.86
57.69
20.80
8.34
108.83
4.37
–
4.37
37.91
–
37.91
78.95
–
78.95
26.13
–
–
26.13
11.65
–
11.65
12.03
–
12.03
3.13
–
–
3.13
–
–
–
–
–
–
18848.69
174.17
8399.32
76.36
565.79
26932.75
4500.73
112.37
1428.15
Previous year
14624.62
–
4427.24
138.41
341.58 18848.69
3477.50
–
1136.83
Add: Asset held for sale
Add: Capital work-in-progress
Foreign
currency
fluctuation
Deductions
Up to
31-3-2013
As at
31-3-2013
As at
31-3-2013
As at
31-3-2012
–
0.71
0.71
4.38
–
4.38
16.63
–
16.63
1.41
–
–
1.41
1.53
–
1.53
2.04
–
2.04
3.68
–
–
3.68
–
–
–
–
–
–
–
3.18
3.18
19.04
–
19.04
–
50.32
50.32
549.88
31.96
581.84
84.60
16.87
101.47
3466.26
224.97
3691.23
24.80
10.03
0.37
35.20
5.44
0.05
5.49
22.18
0.01
22.19
13.20
25.76
0.91
39.87
–
7.15
–
–
–
7.15
540.13
30.97
2.48
573.58
221.63
0.19
221.82
242.24
4.48
246.72
199.43
55.38
–
254.81
28.84
12.98
135.35
32.21
8.34
217.72
5.91
–
5.91
21.13
0.69
21.82
2.97
6.93
9.90
–
–
–
–
–
–
–
0.07
–
0.07
–
–
–
–
–
–
–
–
–
–
30.38
45.75
233.59
5838.04
37.70 #
159.35
4500.73
13.74
1090.17
896.49
1986.66
4438.01
834.31
5272.32
8575.84
311.49
8887.33
355.29
15.91
0.10
371.30
192.24
0.53
192.77
277.82
13.82
291.64
220.50
151.29
–
371.79
1130.16
762.79
1892.95
2994.57
417.32
3411.89
6120.20
333.34
6453.54
314.00
26.18
0.01
340.19
166.36
0.64
167.00
243.86
14.97
258.83
187.53
126.20
–
313.73
290.00
106.10
1535.15
1103.36
648.59
3683.20
(239.36)
20817.65
299.67
116.43
712.50
367.49
–
1496.09
(239.36)
14094.86
21.34
42.87
14116.20
20860.52
4017.49 ## 8056.20
22172.40
24878.01
#
Impairment upto 31-03-2013 37.70 crore, out of which 24.86 crore is debited to the Statement of Profit and Loss, 0.36 crore is debited to foreign currency translation reserve and 1.26 crore is transferred to asset
held for sale
## Capital work-in-progress is net of impairment of 7.94 crore upto 31-03-2013, during the year 7.94 crore
237
Notes forming part of the Consolidated Accounts (contd.)
NOTE [E(II)]
Intangible assets
Cost/valuation
Amortisation
Impairment
Book value
crore
Particulars
Specialised softwares
Technical knowhow
Trade marks
New product design and
development
Customer contracts and relationship
Toll collection rights
Utility right to use
Total
Previous year
Pursuant to
acquisition of
subsidiaries
17.17
–
–
8.07
–
–
–
25.24
Foreign
currency
fluctuation
14.11
(0.12)
–
–
4.96
–
–
18.95
Deductions
17.48
0.83
3.00
–
–
153.60
–
174.91
As at
31-3-2013
806.44
85.54
–
18.05
110.67
8079.12
1.53
9101.35
Pursuant to
acquisition of
subsidiaries
14.76
–
–
3.71
–
–
–
18.47
Up to
31-3-2012
279.63
29.05
3.00
–
13.21
895.01
–
1219.90
Additions
159.95
34.88
–
9.98
–
3572.68
1.53
3779.02
For the
year
98.29
8.27
–
2.04
11.00
445.32
0.08
565.00
–
1081.27
1.00
190.04
5453.05
918.67
–
305.76
As at
1-4-2012
632.69
51.61
3.00
–
105.71
4660.04
–
5453.05
4560.82
Foreign
currency
fluctuation
1.32
(0.14)
–
–
0.69
–
–
1.87
1.51
Deductions
14.55
0.39
3.00
–
–
138.87
–
156.81
Up to
31-3-2013
379.45
36.79
–
5.75
24.90
1201.46
0.08
1648.43
6.04
1219.90
Add: Intangible assets under development
NOTE [E(III)]
Goodwill on consolidation
As at
31-3-2013
–
–
–
–
–
–
–
–
–
As at
31-3-2013
426.99
48.75
–
12.30
85.77
6877.66
1.45
7452.92
As at
31-3-2012
353.06
22.56
–
–
92.50
3765.03
–
4233.15
7289.32
6857.03
14742.24 11090.18
Particulars
Goodwill on consolidation
Previous year
Pursuant to
acquisition of
subsidiaries
–
–
As at
1-4-2012
1454.53
1336.19
Cost/valuation
Foreign
currency
fluctuation
17.28
33.51
Additions*
727.92
84.83
Amortisation
Impairment
Book value
crore
Deductions
12.24
–
As at
31-3-2013
2187.49
1454.53
Up to
31-3-2012
359.35
212.45
Pursuant to
acquisition of
subsidiaries
–
–
For the
year
(341.64) #
136.68
Foreign
currency
fluctuation
(12.85)
10.22
Deductions
4.86
–
Up to
31-3-2013
–
359.35
As at
31-3-2013
67.74 ##
41.29
As at
As at
31-3-2012
31-3-2013
2119.75
1053.89
1053.89 1082.45
# Net of amortisation charge of 0.56 crore for current year in respect of subsidiaries sold during the year
## Impairment upto 31-03-2013 67.74 crore, during the year 26.45 crore debited to the Statement of Profit and Loss
* Additions in goodwill represents consideration paid in excess of share in net worth of subsidiaries acquired during the year
During the quarter and year ended March 31, 2013, the Company has revised its accounting policy of amortisation of goodwill on consolidation for more appropriate presentation
of financial statements [Note R(4)(c)]. Accordingly, the goodwill on consolidation will be subjected to impairment test and will not be amortised. Consequently, the accumulated
amortisation of goodwill till December 31, 2012 has been credited to the Consolidated Financial Statements. Had the Company continued to follow the accounting policy of
352.04 crore being
amortisation of goodwill, the profit for the year in the Consolidated Financial Statements would have been lower by
accumulated amortisation in respect of earlier years) as follows:
525.72 crore (including write back of
Particulars
Accumulated goodwill amortised as on April 1, 2012 in respect of subsidiaries credited to the Consolidated Statement of Profit and Loss.
Accumulated goodwill amortised as on April 1, 2012 in respect of associates credited to the Consolidated Statement of Profit and Loss. [Note F(I)]
Amortisation charge for the year 2012-13 had the Company continued to follow the policy of amortisation of goodwill
Total
crore
Amount
342.20
9.84
173.68
525.72
Notes:
1
Cost/valuation of:
(i)
Freehold land includes 0.14 crore (previous year: 0.14 crore) for which conveyance is yet to be completed.
(ii)
Leasehold land includes:
(a)
15.25 crore for land taken at Nagpur on Lease from Maharashtra Airport Development Company Limited for a period of
99 years with effect from June 1, 2008 vide agreement dated June 20, 2008 for developing IT Infrastructure facilities.
(b)
Nil (previous year: 5.25 crore) added during the year in respect of which lease agreements are yet to be executed.
2
Cost/valuation of Buildings includes ownership accommodation:
(i)
(a)
in various co-operative societies and apartments and shop-owners’ associations: 111.34 crore, including 2365 shares of
50 each, 232 shares of 100 each and 2 shares of 250 each.
238
Notes forming part of the Consolidated Accounts (contd.)
(b)
(c)
in proposed co-operative societies 12.80 crore.
in various co-operative societies and apartments and shop-owners’ associations: 22.64 crore, for which share certificates
are yet to be issued.
(ii) of 4.39 crore in respect of which the deed of conveyance is yet to be executed.
(iii) of 8.48 crore representing undivided share in a property at a certain location.
Cost/valuation of buildings includes 49.49 crore for building constructed on leasehold land of 52.79 acres (out of 90.36 acres of
leasehold land, 37.57 acres has been taken back by the lessor) on a 66 years lease agreement entered with National Academy of
Construction (NAC) dated October 1, 2001 yet to be registered with appropriate authority.
The Company had taken land for
converted into freehold land w.e.f June 4, 2012.
Depreciation for the year on tangible assets/capital work-in-progress includes obsolescence 16.38 crore (previous year: 9.72 crore)
and impairment 6.81 crore (previous year: 5.54 crore).
The Company has revalued as at October 1, 1984 some of its land, buildings, plant & equipment and railway sidings at replacement/
market value, which resulted in a net increase of 108.05 crore.
2.63 crore in Mysore from KIADB based on lease and sale agreement. The aforesaid land got
3
4
5
6
7 Owned assets given on operating lease have been presented separately under tangible assets note as per Accounting Standard (AS) 19
8
9
10
“Leases”.
As per para 63 of Accounting Standard (AS) 26 “Intangible Assets”, presently the subsidiaries with Toll Collection Rights amortise
the asset on Straight line method (SLM) over the concession period. The amortisation computed above, is higher than amortisation
computed in terms of the Notification No.G.S.R. 298 (E) dated April 17, 2012 issued by the Ministry Of Corporate Affairs (on
amortisation of intangible assets created under ”Build-Operate-Transfer, Build-Own-Operate-Transfer“ and other forms of ”Public-
Private-Partnership“ Route). Accordingly, the subsidiaries continue to amortise the Toll Collection Rights on a straight line basis over
the concession period.
In case of two subsidiaries, deductions in respect of toll collection rights amounting to
Nil (previous year: 23.70 crore) and
Nil (previous year: 159.80 crore) pertain to reimbursement of claims from National Highways Authority of India (NHAI) and
decapitalisation of toll expenditure to intangible assets respectively.
In case of one subsidiary, capital work-in-progress amounting to Nil (previous year: 611.65 crore) has been reclassified to inventory
in view of the management’s decision to sell the area instead of leasing it.
11 Cost/valuation as at April 1, 2012 of individual assets has been reclassified, wherever necessary.
12 Additions during the year and capital work-in-progress/intangible assets under development include
903.57 crore (previous
year: 1198.47 crore) being borrowing cost capitalised in accordance with Accounting Standard (AS) 16 “Borrowing Costs” as
specified in the Companies (Accounting Standards) Rules, 2006. Asset wise break-up of borrowing costs capitalised is as follows:
Asset Class
2012-13
2011-12
crore
Tangible
Leasehold land
Dredged channel
Breakwater structures
Building owned
Leased out building
Plant & equipment owned
Computer owned
Office equipment owned
Furniture and fixture owned
Vehicle owned
Railway sidings
Intangible
Specialised software
Technical knowhow
Toll collection rights
Capital work-in-progress
Intangible assets under development
Total
0.60
1.20
2.79
29.68
3.17
26.54
1.09
0.05
0.86
0.01
0.17
0.04
0.14
0.49
483.39
353.35
903.57
30.11
–
–
116.86
–
65.11
0.70
0.26
0.01
0.01
48.59
0.19
–
–
447.67
488.96
1198.47
239
Notes forming part of the Consolidated Accounts (contd.)
NOTE [F]
Non-current investments (at cost unless otherwise specified)
Particulars
Long term investment
Trade investments:
Investments in equity instruments
Fully paid equity shares
Less: Provision for diminution in value
Investment in associates: [Note F(I)]
Fully paid equity shares of associate companies
Add/(deduct):
Accumulated share in profit/(loss) of the associate
companies at the beginning of the year
Adjustment pursuant to an associate becoming a subsidiary
Adjustment pursuant to dilution/divestment of
stake in associates
Add/(deduct):
Share in profit/(loss) (net) of associate companies-
during the year
Share in non-statutory reserves of associate companies-
during the 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 investment:
Government and trust securities
Debentures and bonds
Less: Provision for diminution in value
Mutual funds
Other fully paid equity shares
Less: Provision for diminution in value
Fully paid preference shares
Security receipt
Investment in venture capital units
Share application money pending allotment
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
42.90
15.90
150.81
363.77
(175.84)
(2.93)
335.81
38.43
–
2.75
(4.61)
(48.57)
(0.56)
312.94
0.01
205.63
0.54
19.90
15.90
160.72
341.02
–
1.92
503.66
46.16
0.02
2.76
(25.35)
(56.79)
(0.56)
209.88
–
533.81
0.56
27.00
323.25
92.64
312.93
44.00
205.09
243.00
8.67
2.00
4.37
1262.95
4.00
469.90
74.83
209.88
2.00
533.25
243.00
24.23
–
3.78
1564.87
F(I) Investments in associates include goodwill of
crore) and is further net of capital reserve of
of goodwill of
associate company sold during the year 2012-13. [Note E(III) & Note R(4)(c)].
9.84 crore was credited to the Statement of Profit and Loss and
23.95 crore (previous year: 24.24 crore net of cumulative amortisation of 19.01
0.25 crore (previous year: 0.25 crore). During the year, accumulated amortisation
9.17 crore was deducted in respect of stake in
240
Notes forming part of the Consolidated Accounts (contd.)
NOTE [G(I)(a)]
Long term loans and advances
Particulars
Secured considered good
Loans against mortgage of house property
Capital advances
Rent deposit (KMP’s)
Unsecured considered good
Capital advances
Loan and advances to related parties
Associate companies
Advances recoverable
Joint ventures
Loans
Advance recoverable
Other loans and advances
Security deposits
Earnest money deposits
Advances recoverable in cash or in kind
Income tax receivable of current year [net of provision for tax of
159.50 crore (previous year: 228.66 crore)]
Balance with customs, port trust, etc.
Lease receivables
Considered doubtful
Capital advances
Other loans and advances
Less: Allowance for doubtful loan and advances
NOTE [G(I)(b)]
Long term loans and advances towards financing activities
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
5.62
6.98
0.01
161.05
crore
9.01
60.93
0.01
180.80
12.11
453.37
0.28
213.36
6.09
1321.86
18.26
0.32
1.16
1.86
0.33
1563.24
2.19
8.20
283.63
–
465.76
291.83
268.89
1.33
1225.00
4.26
0.32
1.58
–
–
1501.38
–
1561.05
2200.47
1501.38
2043.96
Particulars
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
Secured loans:
Considered good:
Term loans
Finance lease
Debentures
Considered doubtful:
Term loans [Note G(I)(b)(i)]
Less: Allowance for non-performing assets
Less: Contingent provisions against standard assets
Less: Provision for standard assets
Carried forward
20439.34
91.67
768.33
169.69
21469.03
169.69
72.26
85.38
15479.35
109.48
670.27
90.30
16349.40
90.30
48.32
8.09
21141.70
21141.70
16202.69
16202.69
241
Notes forming part of the Consolidated Accounts (contd.)
NOTE [G(I)(b)]
Long term loans and advances towards financing activities (contd.)
Particulars
Brought forward
Unsecured loans:
Considered good:
Term loans
Debentures
Considered doubtful:
Term loans [Note G(I)(b)(i)]
Less: Allowance for non-performing assets
Less: Contingent provisions against standard assets
As at 31-3-2013
As at 31-3-2012
crore
crore
21141.70
crore
crore
16202.69
661.18
40.00
83.57
784.75
83.57
2.98
378.75
28.00
67.79
474.54
67.79
4.34
698.20
21839.90
402.41
16605.10
G(I)(b)(i) Loans and advances towards financing activities are classified as doubtful to the extent of provision made following prudential
norms for provisioning of assets prescribed by the Reserve Bank of India.
NOTE [G(II)]
Cash and bank balances
Particulars
Cash and bank balances not available for immediate use
NOTE [G(III)]
Other non-current assets
Particulars
Interest accrued on investments and others
Unamortised expenses
Others
NOTE [H(I)]
Current investments
Particulars
Current investments:
Fully paid equity shares
Less: Provision for diminution in value
Carried forward
242
As at 31-3-2013
As at 31-3-2012
crore
59.65
59.65
crore
143.56
143.56
As at 31-3-2013
As at 31-3-2012
crore
21.95
92.67
–
114.62
crore
24.96
76.09
0.71
101.76
As at 31-3-2013
As at 31-3-2012
crore
11.05
2.00
crore
crore
crore
6.86
–
9.05
9.05
6.86
6.86
Notes forming part of the Consolidated Accounts (contd.)
NOTE [H(I)]
Current investments (contd.)
Particulars
Brought forward
Government and trust securities
Less: Provision for diminution in value
Debentures and bonds
Less: Provision for diminution in value
Mutual funds
Less: Provision for diminution in value
Other investments
Less: Provision for diminution in value
Current portion of long term investments:
Debentures and bonds
Mutual funds
NOTE [H(II)]
Inventories (at cost or net realisable value whichever is lower)
Particulars
Raw materials
[including goods-in-transit 43.42 crore (previous year: 20.40 crore)]
Components
[including goods-in-transit 77.64 crore (previous year: 53.32 crore)]
Construction materials
[including goods-in-transit 0.33 crore (previous year: 1.99 crore)]
Manufacturing work-in-progress
Finished goods
(includes 25.78 crore on an associate becoming a subsidiary)
Stock-in-trade (in respect of goods acquired for trading)
[including goods-in-transit 32.98 crore (previous year: 52.82 crore)]
Stores and spares
[including goods-in-transit 4.19 crore (previous year: 3.12 crore)]
Loose tools
Property development projects (including land)
Completed property
As at 31-3-2013
As at 31-3-2012
crore
113.37
0.86
989.25
0.25
4080.21
–
2289.01
0.23
–
25.00
crore
9.05
112.51
989.00
4080.21
crore
381.10
7.89
393.69
1.55
1157.29
0.02
4922.37
6.37
crore
6.86
373.21
392.14
1157.27
2288.78
4916.00
100.12
279.02
25.00
7504.55
379.14
7224.62
As at 31-3-2013
As at 31-3-2012
crore
868.91
488.27
397.96
811.56
282.20
189.54
153.48
6.47
1969.75
1.33
5169.47
crore
970.97
399.49
129.27
562.37
302.69
220.48
111.31
4.84
1500.09
26.65
4228.16
243
Notes forming part of the Consolidated Accounts (contd.)
NOTE [H(III)]
Trade receivables
Trade receivables
Secured
Particulars
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
Debts outstanding for more than 6 months
Considered good
Other debts
Considered good
Unsecured
Debts outstanding for more than 6 months
Considered good
Considered doubtful
Other debts
Considered good
Less: Allowance for doubtful debts
NOTE [H(IV)]
Cash and bank balances
Particulars
Cash and cash equivalents
3.71
4.81
1991.06
548.16
2539.22
21015.33
23554.55
548.16
0.39
3.78
8.52
4.17
1888.55
636.82
2525.37
18758.38
21283.75
636.82
23006.39
23014.91
20646.93
20651.10
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
Balance with banks
Cheques and drafts on hand
Cash on hand
Fixed deposits with banks (maturity less than 3 months)
1272.31
424.12
19.59
644.85
1315.98
298.39
17.10
1211.20
Other bank balances
Fixed deposits with banks including interest accured thereon
1002.50
429.21
[includes 80.14 crore (previous year: 22.57 crore) of bank
2360.87
2842.67
deposit with more than 12 months maturity]
Earmarked balances with banks-unclaimed dividend
Earmarked balances with banks-others
Margin money deposits
Cash and bank balances not available for immediate use
Bank balances subject to restriction on repatriation
23.85
14.82
5.21
155.35
8.94
19.52
10.45
15.30
52.49
8.94
1210.67
3571.54
535.91
3378.58
244
Notes forming part of the Consolidated Accounts (contd.)
NOTE [H(V)]
Short term loans and advances
Particulars
Secured considered good:
Loans against mortgage of house property
Key management personnel
Others
Others loans and advances
Unsecured:
Loans and advances to related parties
Considered good:
Associates:
Advance recoverable
Joint ventures
Loans
Advance recoverable
Others
Considered good:
Security deposits
Earnest money deposit
Advances recoverable in cash or in kind
Income tax receivable of current year
[net of provision for tax of 288.74 crore
(previous year: 1986.25 crore)]
Balance with customs, port trust etc.
Lease receivables
Considered doubtful:
Deferred credit against sale of ships
Security deposits
Other loans and advances
Less: Allowance for doubtful loans and advances
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
–
1.80
–
6.69
–
0.04
477.46
72.57
5525.83
62.22
104.74
0.49
22.58
1.40
131.79
6399.08
155.77
0.28
1.80
100.00
1.80
102.08
11.48
84.04
–
6.73
95.52
216.14
36.16
4748.06
152.66
78.42
0.50
21.16
0.47
130.80
5384.37
152.43
6243.31
6251.84
5231.94
5429.54
245
Notes forming part of the Consolidated Accounts (contd.)
NOTE [H(V)(a)]
Short term loans and advances towards financing activities
Particulars
As at 31-3-2013
As at 31-3-2012
crore
crore
crore
crore
Secured loans:
Considered good:
Term loans
Finance lease
Debentures
Less: Contingent provision against standard assets
Unsecured loans:
Considered good:
Term loans
Less: Contingent provision against standard assets
NOTE [H(VI)]
Other current assets
Particulars
Due from customers (construction and project related activity)
Due from customers (property development activity)[Note Q(9)(b)]
Interest accrued on investments and others
Unbilled revenue
Unamortised expenses
Billed interest and other receivable
Others
7978.82
56.45
182.99
8218.26
25.77
1975.06
5.34
6367.43
54.13
96.32
6517.88
19.34
8192.49
6498.54
1674.69
4.41
1969.72
10162.21
1670.28
8168.82
As at 31-3-2013
As at 31-3-2012
crore
19322.35
1.83
419.93
161.64
29.82
56.90
26.27
crore
14815.91
–
271.05
144.14
26.33
37.41
30.88
20018.74
15325.72
246
Notes forming part of the Consolidated Accounts (contd.)
NOTE [I]
Contingent liabilities
Particulars
(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 appeals
(e)
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
As at 31-3-2013
As at 31-3-2012
crore
319.49
124.96
54.43
0.21
535.63
crore
382.75
118.89
36.86
0.21
292.06
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 (e) supra, pending resolution of the
arbitration/appellate proceedings.
Particulars of contingent liabilities in respect of joint venture is given in Note Q(17).
NOTE [J]
Commitments:
Particulars
Estimated amount of contracts remaining to be executed on capital
account (net of advances)*
Estimated amount of committed funding by way of loans to joint
venture companies
* Particulars of capital commitments in respect of joint ventures is given in Note Q(17)
As at 31-3-2013
As at 31-3-2012
crore
26611.46
–
crore
19248.07
50.00
NOTE [K]
Revenue from operations
Particulars
Sales & service:
2012-13
2011-12
crore
crore
crore
crore
Manufacturing and trading activity
Construction and project related activity [Note Q(9)(a)]
Property development activity [Note Q(9)(b)]
Software development products and services
Income from financing activity/annuity based projects
Toll collection and related activity
Servicing
Commission
Engineering and service fees
Income from port services
Charter hire income
Investment/portfolio management and trusteeship fees
Premium earned (net)
7629.30
55880.96
228.92
3760.20
3971.62
720.32
570.96
158.84
1293.81
198.14
137.37
33.06
111.70
Carried forward
7674.19
48158.37
351.54
3057.18
2976.78
431.69
385.60
204.51
923.05
76.65
90.57
12.13
36.16
74695.20
74695.20
64378.42
64378.42
247
Notes forming part of the Consolidated Accounts (contd.)
NOTE [K]
Revenue from operations (contd.)
Particulars
Brought forward
Other operational revenue:
2012-13
crore
crore
74695.20
2011-12
crore
crore
64378.42
Income from hire of plant and equipment
Technical fees
Lease rentals
Property maintenance recoveries
Facility management income
Premium earned (net) on related forward exchange contract
Miscellaneous income
7.75
0.24
107.31
15.16
14.17
165.82
189.66
0.85
0.12
91.18
14.81
11.87
233.31
229.52
K(I) Revenue from sales & service include:
(a)
691.51 crore (previous year: 303.99 crore) for price variations net of liquidated damages in terms of contracts with the
customers.
(b) Shipbuilding subsidy
year: 18.24 crore).
10.02 crore (previous year: 2.09 crore) and reversal of shipbuilding subsidy of
7.22 crore (previous
500.11
75195.31
581.66
64960.08
NOTE [L]
Other income
Interest income
Particulars
2012-13
2011-12
crore
crore
crore
crore
Interest Income on long term investments
Interest Income on current investments
Interest Income on others
Joint venture & associate companies
Others
Dividend income
From long term investments
Trade investments
Others
From current investments
Net gain/(loss) on sale of investments
Long term investments (net)
Current investments (net)
Net gain/(loss) on sale of fixed assets (net)
Lease rental
Miscellaneous income (net of expenses)
248
25.52
316.32
41.62
106.09
2.22
54.82
57.04
11.61
22.46
270.08
8.96
375.64
26.99
76.33
489.55
487.92
16.58
74.49
91.07
54.34
68.65
145.41
9.41
171.45
292.54
202.22
2.55
40.42
1095.93
180.86
12.31
1.08
1.39
828.97
Notes forming part of the Consolidated Accounts (contd.)
NOTE [M]
Manufacturing, construction and operating expenses
Particulars
Materials consumed:
Raw materials and components
Less: Scrap sales
Construction materials
Purchase of stock-in-trade
Stores, spares and tools consumed
Sub-contracting charges
Value of stock transferred on disposal of subsidiary/business
Change in inventories of finished goods, work-in-progress and
stock-in-trade:
Closing stock:
Finished goods
Stock-in-trade
Work-in-progress
Less: Opening stock:
Finished goods (includes 2.14 crore on acquisition
of a subsidiary)
Stock-in-trade
Work-in-progress (includes 2.45 crore on acquisition
of a subsidiary)
Other manufacturing, construction and operating expenses:
Excise duty
Power and fuel [Note O(I)]
Royalty and technical know-how fees
Packing and forwarding [Note O(I)]
Hire charges-plant and equipment and others
Bank guarantee charges
Insurance claim incurred (net)
Engineering, professional, technical and consultancy fees
Insurance [Note O(I)]
Rent [Note O(I)]
Rates and taxes [Note O(I)]
Travelling and conveyance [Note O(I)]
Repairs to plant and equipment
Repairs to buildings [Note O(I)]
General repairs and maintenance [Note O(I)]
Port operation expenses
Carried forward
2012-13
2011-12
crore
crore
crore
crore
10944.59
154.35
10977.80
113.84
10863.96
13037.00
2456.02
2184.29
10969.25
(15.33)
(598.76)
10790.24
15562.64
2179.87
2705.02
14322.47
(51.23)
(1514.33)
302.69
220.48
2078.45
2601.62
297.92
209.43
1495.51
2002.86
17.13
701.11
70.08
216.81
939.18
66.98
63.94
564.51
136.98
233.50
201.36
540.80
61.23
17.40
220.33
31.49
43994.68
4082.83
38896.43
249
256.42
189.54
3674.58
4120.54
304.83
220.48
2080.90
2606.21
(6.52)
890.89
49.36
283.67
1204.88
78.60
109.17
688.74
161.33
318.21
270.22
744.84
67.51
17.35
310.91
67.54
5256.70
Notes forming part of the Consolidated Accounts (contd.)
NOTE [M]
Manufacturing, construction and operating expenses (contd.)
Particulars
Brought forward
Cost of built up space and property development land:
Opening stock:
Work-in-progress
Completed property
Property development land
Add: Expenses on construction during the year
Add: Transferred from fixed asset to inventory
Less: Closing Stock:
Work-in-progress
Completed property
Property development land
Operating cost of shipping business
Miscellaneous expenses [Note O(I)]
Finance cost of financial services business:
Interest and other financing charges
Staff expenses for software development business:
Salaries, wages and bonus
Contribution to and provision for
Provident fund and pension fund
Superannuation/employee pension schemes
Gratuity funds [Note Q(10)(ii)(b)]
Expenses on employee stock option scheme
Staff welfare expenses
2012-13
2011-12
crore
5256.70
crore
43994.68
crore
4082.83
crore
38896.43
1268.11
26.65
231.98
1526.74
383.56
–
1910.30
1722.04
1.33
247.71
1971.08
(60.78)
53.78
883.18
292.35
107.94
345.71
746.00
104.89
611.65
1462.54
1268.11
26.65
231.98
1526.74
(64.20)
36.86
598.07
6132.88
4653.56
2350.16
1664.12
2350.16
1664.12
1754.14
137.06
5.63
9.41
0.50
308.49
1435.82
105.18
8.99
14.70
1.64
310.05
2215.23
54692.95
1876.38
47090.49
M(I) Other manufacturing, construction and operating expenses include
2964.62 crore (previous year: 1930.54 crore) towards
construction of 1400 MW power plant at Rajpura, Punjab.
250
Notes forming part of the Consolidated Accounts (contd.)
NOTE [N]
Employee benefits expense
Particulars
Salaries, wages and bonus
Contribution to and provision for:
Provident fund and pension fund
Superannuation/employee pension schemes
Gratuity funds [Note Q(10)(ii)(b)]
Expenses on employee stock option scheme
Employee medical & other insurance premium expenses [Note O(I)]
Staff welfare expenses
NOTE [O]
Sales, administration and other expenses
Particulars
Power and fuel [Note O(I)]
Packing and forwarding [Note O(I)]
Insurance [Note O(I)]
Rent [Note O(I)]
Rates and taxes [Note O(I)]
Travelling and conveyance [Note O(I)]
Repairs to buildings [Note O(I)]
General repairs and maintenance [Note O(I)]
Professional fees
Directors’ fees
Telephone, postage and telegrams
Advertising and publicity
Stationery and printing
Commission:
Distributors and agents
Employees and others
Bank charges
Discount on sales
Miscellaneous expenses [Note O(I)]
Bad debts and advances written off
Less: Allowances for doubtful debts and advances written back
Allowances for doubtful debts,advances and non-performing assets (net)
Provision for foreseeable losses on construction contracts
Provision/(reversal) for diminution in value of investments(net)
Exchange (gain)/loss
Provision for standard assets
Other provisions [Note Q(18)(a)]
2012-13
crore
crore
5139.08
2011-12
crore
crore
3998.60
146.10
54.92
73.07
123.31
37.90
72.25
2012-13
crore
40.96
9.39
353.69
116.58
274.09
98.71
62.42
649.87
6224.17
crore
99.24
234.85
38.60
276.26
137.72
437.65
15.19
330.50
375.56
1.99
176.08
140.22
62.36
50.35
86.52
72.17
518.16
237.11
5.64
14.77
(9.85)
488.08
58.68
(75.62)
3772.23
2011-12
crore
32.04
23.37
174.60
50.38
233.46
203.63
38.35
524.19
4998.23
crore
78.65
145.03
26.25
240.29
91.00
339.81
22.12
258.57
363.49
1.06
142.73
105.98
51.86
55.41
61.39
58.43
375.27
124.22
212.52
6.00
(4.70)
570.07
29.07
13.92
3368.44
251
Notes forming part of the Consolidated Accounts (contd.)
NOTE O(I) Aggregation of expenses disclosed vide notes M, N and O in respect of specific items are as follows:
crore
Sr. no.
Nature of expenses
2012-13
2011-12
Note M
Note N
Note O
Total
Note M
Note N
Note O
Total
1
2
3
4
5
6
7
8
Power and fuel
Packing and forwarding
890.89
283.67
–
–
99.24
990.13
701.11
234.85
518.52
216.81
–
–
78.65
779.76
145.03
361.84
Insurance
Rent
Rates and taxes
Travelling and conveyance
Repairs to buildings
General repairs and
maintenance
161.33
62.42
38.60
262.35
136.98
38.35
26.25
201.58
318.21
270.22
744.84
17.35
310.91
–
–
–
–
–
276.26
594.47
233.50
137.72
407.94
201.36
437.65
1182.49
540.80
15.19
32.54
17.40
330.50
641.41
220.33
–
–
–
–
–
240.29
473.79
91.00
292.36
339.81
880.61
22.12
39.52
258.57
478.90
9 Miscellaneous expenses
883.18
–
518.16
1401.34
598.07
–
375.27
973.34
NOTE [P]
Finance costs
Particulars
Interest expenses
Other borrowing costs
Exchange loss (attributable to finance costs)
2012-13
crore
1971.69
17.50
105.83
2095.02
2011-12
crore
1021.05
10.15
184.65
1215.85
NOTE [Q]
Q(1) The Balance Sheet as on March 31, 2013 and the Statement of Profit and Loss for the year ended March 31, 2013 are drawn and
presented as per the new Schedule VI to the Companies Act, 1956.
Q(2) 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.
252
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Q(3) The list of subsidiaries,associates and joint ventures included in the Consolidated Financial Statements are as under:
Name of subsidiary company
Sr.
no.
Indian Subsidiaries
1 Tractor Engineers Limited
2 Bhilai Power Supply Company Limited
3 L&T-Sargent & Lundy Limited
4 Spectrum Infotech Private Limited
5 L&T-Valdel Engineering Limited
6 L&T Shipbuilding Limited
7 L&T Electricals and Automation Limited
8 Hi-Tech Rock Products & Aggregates Limited
9 L&T Seawoods Private Limited
10 L&T-Gulf Private Limited
11 L&T-MHI Boilers Private Limited
12 L&T-MHI Turbine Generators Private Limited
13 Raykal Aluminium Company Private Limited
14 L&T Natural Resources Limited
15 L&T Plastics Machinery Limited #
16 L&T Technologies Limited
17 L&T Special Steels and Heavy Forgings Private Limited
18 PNG Tollway Limited
19 Kesun Iron & Steel Company Private Limited
20 L&T Howden Private Limited
21 L&T Solar Limited
22 L&T Sapura Shipping Private Limited
23 L&T Sapura Offshore Private Limited
24 L&T PowerGen Limited
25 Ewac Alloys Limited
26 L&T Kobelco Machinery Private Limited
27 L&T Geostructure LLP
28 Audco India Limited @
29 L&T Realty Limited
30 L&T Asian Realty Project LLP
31 L&T Parel Project LLP
32 Chennai Vision Developers Private Limited
33 L&T Urban Infrastructure Limited
34 L&T South City Projects Limited
35 L&T Siruseri Property Developers Limited
36 L&T Vision Ventures Limited
37 L&T Tech Park Limited
38 L&T Bangalore Airport Hotel Limited
39 CSJ Infrastructure Private Limited
40 CSJ Hotels Private Limited
41 L&T Commercial Projects Private Limited (formerly known as
L&T Arun Excello Commercial Projects Private Limited) ##
42 L&T Chennai Projects Private Limited (formerly known as
L&T Arun Excello IT SEZ Private Limited)
43 L&T Power Limited
As at 31-3-2013
As at 31-3-2012
Country of
incorporation
Proportion
of ownership
interest (%)
Proportion of
voting power
held (%)
Proportion
of ownership
interest (%)
Proportion of
voting power
held (%)
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
India
India
India
India
India
India
100.00
99.90
50.0002
100.00
100.00
97.00
100.00
100.00
100.00
50.0002
51.00
51.00
75.50
100.00
–
100.00
74.00
72.11
95.00
50.10
100.00
60.00
60.00
100.00
100.00
51.00
74.00
100.00
100.00
50.00
100.00
100.00
100.00
51.00
51.00
68.00
51.00
74.00
82.00
82.00
–
100.00
99.90
50.0002
100.00
100.00
97.00
100.00
100.00
100.00
50.0002
51.00
51.00
75.50
100.00
–
100.00
74.00
72.11
95.00
50.10
100.00
60.00
60.00
100.00
100.00
51.00
74.00
100.00
100.00
55.00
100.00
100.00
100.00
51.00
51.00
68.00
51.00
74.00
82.00
82.00
–
100.00
100.00
99.99
99.99
100.00
99.90
50.0002
100.00
100.00
100.00
100.00
100.00
100.00
50.0002
51.00
51.00
75.50
100.00
100.00
100.00
74.00
72.11
95.00
50.10
100.00
60.00
60.00
100.00
100.00
51.00
–
–
100.00
50.00
100.00
100.00
100.00
51.00
51.00
68.00
51.00
74.00
82.00
–
51.00
51.00
99.99
100.00
99.90
50.0002
100.00
100.00
100.00
100.00
100.00
100.00
50.0002
51.00
51.00
75.50
100.00
100.00
100.00
74.00
72.11
95.00
50.10
100.00
60.00
60.00
100.00
100.00
51.00
–
–
100.00
55.00
100.00
100.00
100.00
51.00
51.00
68.00
51.00
74.00
82.00
–
51.00
51.00
99.99
253
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Name of subsidiary company
Sr.
no.
Country of
incorporation
44 L&T Cassidian Limited
45 L&T General Insurance Company Limited
46 L&T Aviation Services Private Limited
47 L&T Infocity Limited
48 L&T Hitech City Limited
49 Hyderabad International Trade Expositions Limited
50 Larsen & Toubro Infotech Limited
51 GDA Technologies Limited
52 L&T Finance Holdings Limited
53 L&T Housing Finance Limited
54 Consumer Financial Services Limited
55 Family Credit Limited
56 L&T Finance Limited
57 L&T Capital Markets Limited
58 L&T Investment Management Limited
59 L&T Mutual Fund Trustee Limited
60 L&T Trustee Services Private Limited
(Formerly known as FIL Trustee Company Private Limited)
61 L&T Fund Management Private Limited (formerly known as
FIL Fund Management Private Limited)
62 L&T FinCorp Limited
63 L&T Infrastructure Finance Company Limited
64 L&T Infra Debt Fund Limited
65 L&T Infra Investment Partners Advisory Private Limited
66 L&T infra Investment Partners Trustee Private Limited
67 L&T Unnati Finance Limited
68 L&T Access Financial Advisory Services Limited (formerly known
as L&T Access Financial Advisory Services Private Limited)
69 L&T Capital Company Limited
70 L&T Trustee Company Private Limited
71 L&T Power Development Limited
72 L&T Uttaranchal Hydropower Limited
73 L&T Arunachal Hydropower Limited
74 L&T Himachal Hydropower Limited
75 Nabha Power Limited
76 L&T Infrastructure Development Projects Limited
77 L&T Panipat Elevated Corridor Limited
78 Narmada Infrastructure Construction Enterprise Limited
79 L&T Krishnagiri Thopur Toll Road Limited
80 L&T Western Andhra Tollways Limited
81 L&T Vadodara Bharuch Tollway Limited
82 L&T East-West Tollway Limited
83 L&T Great Eastern Highway Limited
84 L&T Transportation Infrastructure Limited
85 L&T Western India Tollbridge Limited
86 L&T Interstate Road Corridor Limited
87 International Seaports (India) Private Limited
88 L&T Port Kachchigarh 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
India
India
India
India
India
India
India
India
As at 31-3-2013
As at 31-3-2012
Proportion
of ownership
interest (%)
74.00
100.00
100.00
89.00
65.86
51.71
100.00
100.00
82.54
82.54
82.54
82.54
82.54
82.54
82.54
82.54
82.54
Proportion of
voting power
held (%)
74.00
100.00
100.00
89.00
65.86
51.71
100.00
100.00
82.54
82.54
82.54
82.54
82.54
82.54
82.54
82.54
82.54
Proportion
of ownership
interest (%)
74.00
100.00
100.00
89.00
65.86
51.71
100.00
100.00
82.64
–
–
–
82.64
–
82.64
82.64
–
Proportion of
voting power
held (%)
74.00
100.00
100.00
89.00
65.86
51.71
100.00
100.00
82.64
–
–
–
82.64
–
82.64
82.64
–
82.54
82.54
82.54
82.54
82.54
82.54
82.54
82.54
100.00
100.00
100.00
100.00
100.00
100.00
100.00
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
82.54
82.54
82.54
82.54
82.54
82.54
82.54
82.54
100.00
100.00
100.00
100.00
100.00
100.00
100.00
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
97.45
–
82.64
82.64
–
82.64
82.64
82.64
82.64
100.00
100.00
100.00
100.00
100.00
100.00
100.00
97.45
97.45
97.45
97.45
97.45
97.45
–
–
97.45
97.45
97.45
97.45
97.45
–
82.64
82.64
–
82.64
82.64
82.64
82.64
100.00
100.00
100.00
100.00
100.00
100.00
100.00
97.45
97.45
97.45
97.45
97.45
97.45
–
–
97.45
97.45
97.45
97.45
97.45
254
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Name of subsidiary company
Sr.
no.
Country of
incorporation
89 L&T Ahmedabad-Maliya Tollway Limited
90 L&T Halol-Shamlaji Tollway Limited
91 L&T Krishnagiri WalajahpetTollway Limited
92 L&T Devihalli Hassan Tollway Limited
93 L&T Metro Rail (Hyderabad) Limited
94 L&T Transco Private Limited
95 L&T Chennai Tada Tollway Limited
96 L&T BPP Tollway Limited
97 L&T Rajkot-Vadinar Tollway Limited
98 L&T Deccan Tollways Limited
99 L&T Samakhiali Gandhidham Tollway Limited
100 L&T Technology Services Limited (originally formed as L&T
Technology And Engineering Services Company Limited and
name changed subsequently)
101 L&T Tejomaya Limited
India
India
India
India
India
India
India
India
India
India
India
India
India
# The Company has sold its stake on September 28, 2012
##The Company has sold its stake on November 26, 2012
@ Associate became a wholly owned subsidiary w.e.f. March 28, 2013
As at 31-3-2013
As at 31-3-2012
Proportion
of ownership
interest (%)
97.45
97.45
97.45
97.45
97.48
97.45
97.45
97.45
97.45
97.45
97.45
100.00
Proportion of
voting power
held (%)
97.45
97.45
97.45
97.45
97.48
97.45
97.45
97.45
97.45
97.45
97.45
100.00
Proportion
of ownership
interest (%)
97.45
97.45
97.45
97.45
97.48
97.45
97.45
97.45
97.45
97.45
97.45
–
Proportion of
voting power
held (%)
97.45
97.45
97.45
97.45
97.48
97.45
97.45
97.45
97.45
97.45
97.45
–
51.00
51.00
–
–
Name of subsidiary company
Sr.
no.
Foreign Subsidiaries
As at 31-3-2013
As at 31-3-2012
Country of
incorporation
Proportion
of ownership
interest (%)
Proportion of
voting power
held (%)
Proportion
of ownership
interest (%)
Proportion of
voting power
held (%)
1 Larsen & Toubro LLC
2 Larsen & Toubro Infotech GmbH
3 Larsen & Toubro Infotech Canada Limited
4 Larsen & Toubro Infotech LLC
5 L&T Infotech Financial Services Technologies Inc.
6 GDA Technologies Inc.
7 Larsen & Toubro Infotech South Africa (PTY) Limited
8 L&T Infrastructure Development Projects Lanka (Private) Limited
9 Peacock Investments Limited
10 Mango Investments Limited
11 Lotus Infrastructure Investments Limited
12 L&T Diversified India Equity Fund
(formerly known as L&T Real Estate India Fund)
USA
Germany
Canada
USA
Canada
USA
South Africa
Sri Lanka
Mauritius
Mauritius
Mauritius
Mauritius
13 L&T Asset Management Company Limited
14 L&T Realty FZE
15 Larsen & Toubro International FZE
16 Thalest Limited
17 Bond Instrumentation & Process Control Limited
18 Servowatch Systems Limited
19 Servowatch Inc*
20 Larsen & Toubro (Oman) LLC
21 Larsen & Toubro Electromech LLC
22 L&T Modular Fabrication Yard LLC
23 Larsen & Toubro (East Asia) SDN.BHD ##
Mauritius
UAE
UAE
UK
UK
UK
USA
Sultanate of Oman
Sultanate of Oman
Sultanate of Oman
Malaysia
100.00
100.00
100.00
100.00
100.00
100.00
74.90
93.44
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
–
65.00
65.00
65.00
30.00
100.00
100.00
100.00
100.00
100.00
100.00
74.90
93.44
100.00
100.00
100.00
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
100.00
100.00
100.00
100.00
–
93.43
100.00
100.00
100.00
100.00
100.00
100.00
100.00
–
–
–
–
65.00
65.00
65.00
30.00
100.00
100.00
100.00
100.00
100.00
100.00
–
93.43
100.00
100.00
100.00
100.00
100.00
100.00
100.00
–
–
–
–
65.00
65.00
65.00
100.00
255
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Name of subsidiary company
Sr.
no.
Country of
incorporation
24 Larsen & Toubro Qatar LLC ##
25 L&T Overseas Projects Nigeria Limited
26 L&T Electricals & Automation Saudi Arabia Company LLC
(formerly known as L&T Electricals Saudi Arabia Company LLC)
27 Larsen & Toubro Kuwait Construction General Contracting
Qatar
Nigeria
Kindgom of Saudi
Arabia
Kuwait
Company, WLL ##
28 Larsen & Toubro (Qingdao) Rubber Machinery Company Limited
29 Qingdao Larsen & Toubro Trading Company Limited
30 Jiangsu Shengye Valve Co., Ltd.
(formerly known as Larsen & Toubro (Jiangsu) Valve Company
Limited) @@
31 Larsen & Toubro Readymix Concrete Industries LLC ##
32 Larsen & Toubro Saudi Arabia LLC
33 Larsen Toubro Arabia LLC
34 Larsen & Toubro (Wuxi) Electric Company Limited @
35 Larsen & Toubro ATCO Saudia LLC ##
36 Tamco Switchgear (Malaysia) SDN. BHD
37 Henikwon Corporation SDN. BHD
38 Tamco Electrical Industries Australia Pty Limited
39 PT Tamco Indonesia
40 Larsen & Toubro Heavy Engineering LLC
41 L&T Electrical & Automation FZE
42 Larsen & Toubro Consultoria E Projeto Ltda
43 Larsen & Toubro T&D SA (Proprietary) Limited
Peoples Republic of
China
Peoples Republic of
China
Peoples Republic of
China
UAE
Kindgom of Saudi
Arabia
Kindgom of Saudi
Arabia
Peoples Republic of
China
Kindgom of Saudi
Arabia
Malaysia
Malaysia
Australia
Indonesia
Sultanate of Oman
UAE
Brazil
South Africa
As at 31-3-2013
As at 31-3-2012
Proportion
of ownership
interest (%)
49.00
100.00
75.00
Proportion of
voting power
held (%)
100.00
100.00
75.00
Proportion
of ownership
interest (%)
49.00
100.00
75.00
Proportion of
voting power
held (%)
100.00
100.00
75.00
49.00
100.00
100.00
–
49.00
100.00
75.00
–
49.00
100.00
100.00
100.00
100.00
70.00
100.00
100.00
72.50
75.00
100.00
100.00
49.00
100.00
75.00
100.00
100.00
100.00
–
100.00
100.00
100.00
100.00
75.00
49.00
100.00
100.00
100.00
–
–
–
100.00
100.00
75.00
100.00
100.00
100.00
100.00
70.00
100.00
100.00
72.50
49.00
75.00
100.00
–
100.00
100.00
70.00
100.00
100.00
72.50
100.00
–
100.00
100.00
70.00
100.00
100.00
72.50
## The Parent Company, together with its subsidiaries controls the composition of Board of Directors
@ The Company has sold its stake on July 18, 2012
@@ The Company has sold 75% stake on September 4, 2012 and balance 25% is disclosed vide investment in other fully paid equity shares [Note F]
* The Company was acquired during the year and has been dissolved w.e.f. February 28, 2013
Name of associate company
Sr.
no.
Country of
incorporation
1 L&T-Komatsu Limited
2 Audco India Limited **
3 L&T-Chiyoda Limited
4 L&T-Ramboll Consulting Engineers Limited
5 Gujarat Leather Industries Limited @
6 NAC Infrastructure Equipment Limited
7 International Seaport (Haldia) Private Limited
8 Vizag IT Park Limited
9 Larsen & Toubro Qatar & HBK Contracting LLC
10 L&T Camp Facilities LLC
India
India
India
India
India
India
India
India
Qatar
UAE
As at 31-3-2013
As at 31-3-2012
Proportion
of ownership
interest (%)
50.00
–
50.00
50.00
50.00
24.76
21.74
23.14
24.50
49.00
Proportion of
voting power
held (%)
50.00
–
50.00
50.00
50.00
24.76
21.74
23.14
50.00
49.00
Proportion
of ownership
interest (%)
50.00
50.00
50.00
50.00
50.00
24.79
21.74
23.14
24.50
49.00
Proportion of
voting power
held (%)
50.00
50.00
50.00
50.00
50.00
24.79
21.74
23.14
50.00
49.00
256
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Name of associate company
Sr.
no.
Country of
incorporation
11 L&T Arun Excello Realty Private Limited *
12 Feedback Infrastructure Services Private Limited
13 JSK Electricals Private Limited
14 Salzer Electronics Limited #
15 Rishi Consfab Private Limited.
16 Magtorq Private Limited
17 AIC Structural Steel Construction (India) Private Limited
India
India
India
India
India
India
India
@ The Company is under liquidation
* The Company has sold its stake on May 4, 2012
# The accounts have been consolidated for twelve months period ended December 31, 2012
** Associate became a wholly owned subsidiary w.e.f. March 28, 2013
As at 31-3-2013
As at 31-3-2012
Proportion
of ownership
interest (%)
–
19.12
26.00
26.06
26.00
42.85
26.00
Proportion of
voting power
held (%)
–
19.12
26.00
26.06
26.00
42.85
26.00
Proportion
of ownership
interest (%)
33.00
23.16
26.00
26.06
26.00
42.85
–
Proportion of
voting power
held (%)
33.00
23.16
26.00
26.06
26.00
42.85
–
Name of joint venture
Sr.
No.
Country of
residence
As at 31-3-2013
Proportion
of ownership
interest (%)
As at 31-3-2012
Proportion of
ownership interest
(%)
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
Metro Tunneling Group
L&T-Hochtief Seabird Joint Venture
L&T-Shanghai Urban Construction (Group) Corporation Joint Venture
Metro Tunneling Chennai L&T SUCG Joint Venture
The Dhamra Port Company Limited
1
2
3
4
5
6
7
8
9
10 Metro Tunneling Delhi-L&T SUCG Joint Venture
11
12
L&T-Shapoorji Pallonji & Company Limited Joint Venture-TCS
L&T-Shanghai Urban Construction (Group) Joint Venture CC27 Delhi ^^
Jointly controlled entities-foreign joint ventures
L&T-Eastern Joint Venture
Indiran Engineering Projects and Systems
Jointly controlled operations-Indian joint ventures
L&T-HCC Joint Venture
Patel–L&T Consortium
L&T-KBL (UJV) Hyderabad
Consortium of Toyo Engineering Company and L&T
L&T-SVEC Joint Venture
L&T–KBL–MAYTAS UJV
L&T and Scomi Engineering BHD. Joint Venture
13
14
15
16
17
18
19
20
21
65.00
26.00
49.00
43.00
26.00
90.00
51.00
75.00
48.72
60.00
50.00
68.00
65.00
50.00
65.00
26.00
49.00
43.00
26.00
90.00
51.00
75.00
48.72
60.00
50.00
–
65.00
50.00
India
India
India
India
India
India
India
India
India
India
India
India
UAE
Iran
India
India
India
India
India
India
India
^^ The joint venture has been entered into on November 05, 2012
Q(4) Reserves and surplus shown in the Consolidated Balance Sheet includes 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 Statement of Profit and Loss.
Q(5) Exceptional items [Note R(5)]:
a.
b.
c.
Expenses incurred amounting to 38.34 crore on voluntary retirement scheme.
Profit on sale of shares held as equity investment by a subsidiary 237.93 crore (previous year: Nil).
Loss on impairment of Group’s share in net worth of a subsidiary 52.44 crore (previous year: Nil).
257
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
d.
e.
f.
Profit on divestment of the Group’s stake in three subsidiaries 181.16 crore (net) (previous year: Nil).
Profit on divestment of the Group’s part stake in a subsidiary
part stake in a subsidiary 55.02 crore).
1.89 crore (previous year: profit on divestment of the Group’s
Profit on divestment of the Group’s stake in an associate company 6.56 crore (previous year: profit on divestment of the Group’s
stake in two associates 1.75 crore).
Q(6) Extraordinary items [Note R(5)]:
a.
Reversal of 52.89 crore (previous year: Nil), being provision made in earlier years in respect of the Company’s investment in
shares of Satyam Computer Services Limited (SCSL).
b. Gain of 25.22 crore (net of tax 18.72 crore) on sale of the Company’s medical equipment business unit. Tax of 6.50 crore
included under current tax.
Q(7) The expenditure on research and development activities recognised as expense in the Statement of Profit and Loss is 106.96 crore
(previous year: 89.03 crore). Further, the Company has incurred capital expenditure on research and development activities as follows:
a)
on tangible assets of 19.26 crore (previous year: 17.17 crore)
b) on intangible assets being expenditure on new product development of 43.76 crore (previous year: 38.58 crore) [Note R(6)(b)]
and
c)
on other intangible assets of 13.64 crore (previous year: 3.49 crore)
In addition, the Company has carried out work of a developmental nature of
partially/fully paid for by the customers.
Q(8) a)
Provision for current tax includes:
21.27 crore (previous year: 13.06 crore) which is
i)
Provision for income tax in respect of earlier years 8.23 crore (net gain) [previous year: 16.02 crore (net loss)]
ii) Credit for Minimum Alternative Tax (MAT) entitlement 34.49 crore (previous year: 29.17 crore) under section 115JB of
the Income Tax Act, 1961.
iii) Translation effect on account of non-integral foreign operation
0.01 crore (net gain) [previous year: 2.07 crore (net
gain)]
b)
Tax effect of
securities premium account.
0.17 crore (previous year: 0.03 crore) on account of debenture issue expenses which have been credited to
Q(9) (a) Disclosures pursuant to Accounting Standard (AS) 7 (Revised) “Construction Contracts”
Particulars
i)
ii)
iii)
iv)
Contract revenue recognised for the financial year
Aggregate amount of contract costs incurred and recognised profits (less recognised losses) as at
the end of the financial year for all contracts in progress as at that date
Amount of customer advances outstanding for contracts in progress as at the end of the financial
year
Retention amounts due from customers for contracts in progress as at the end of the financial
year
2012-13
55880.96
167087.08
crore
2011-12
48158.37
131510.11
7199.49
8193.35
6597.60
5296.91
(b) Disclosures pursuant to Guidance Note on Accounting for Real Estate Transactions (Revised 2012) issued by the Institute of
Chartered Accountants of India, adopted by the Company with effect from April 1, 2012.
Particulars
i)
ii)
iii)
iv)
v)
Amount of project revenue recognised for the financial year [Note K]
Aggregate amount of costs incurred and profits recognised (less recognised losses) as at the end of the financial
year for all contracts in progress as at that date
Amount of customer advances outstanding for the contracts in progress as at the end of the financial year
Amount of work-in-progress and the value of inventories as at the end of the financial year
Excess of revenue recognised over actual bills raised (unbilled revenue) [Note H(VI)]
crore
2012-13
228.92
70.24
327.29
1968.43
1.83
Q(10) Disclosure pursuant to Accounting Standard (AS) 15 (Revised) “Employee Benefits”
i.
Defined contribution plans: [Note R(7)(b)(i)] Amount of 114.12 crore (previous year: 84.48 crore) is recognised as an expense
and included in “employee benefit expenses” [Note N] in the Statement of Profit and Loss.
258
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
ii. Defined benefit plans: [Note R(7)(b)(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
Add: Amount not recognised as an
asset (limit in para 59(b))
Amount to be recognised as liability
or (asset)
B) Amounts reflected in the Balance Sheet
Liabilities
Assets
Net liability/(asset)
Net liability/(asset)-current
Net liability/(asset)-non-current
Gratuity plan
Post-retirement
medical benefit plan
Company pension plan
Trust-managed
provident fund plan
As at
31-3-2013
As at
31-3-2012
As at
31-3-2013
As at
31-3-2012
As at
31-3-2013
As at
31-3-2012
As at
31-3-2013
As at
31-3-2012
crore
442.48
70.01
512.49
382.83
0.14
4.11
133.63
133.63
–
133.63
133.63
–
386.30
45.99
432.29
322.04
0.03
0.17
110.39
110.39
–
110.39
110.39
–
–
118.95
118.95
–
1.25
–
117.70
117.70
–
117.70
15.00
102.70
–
94.07
94.07
–
1.43
–
92.64
92.64
–
92.64
9.21
83.43
–
198.89
198.89
–
0.53
–
198.36
198.36
–
198.36
11.98
186.38
– 2047.41
184.67
11.50
184.67 2058.91
– 2027.93
–
0.64
1812.84
20.61
1833.45
1791.04
–
–
184.03
–
30.98
–
42.41
184.03
–
184.03
9.84
174.19
45.39
–
45.39
30.98
–
30.98
30.29 # 24.78 #
0.69
20.61
b)
The amounts recognised in Statement of Profit and Loss are as follows:
Particulars
Gratuity plan
Post-retirement medical
benefit plan
Company pension plan
Trust-managed provident
fund plan
crore
1
2
3
4
5
6
7
8
Current service cost
Interest cost
Expected (return) on plan assets
Actuarial losses/(gains)
Past service cost
Adjustment for earlier years
Business Combination
Actuarial gain/(loss) not recognised in
books
Translation adjustments
Amount capitalised out of the above
9
10
Total (1 to 10)
I
II
Amount included in “employee benefits
expense”
Amount included as part of
‘’manufacturing construction and
operating expenses”
Amount included as part of “finance costs”
Amount capitalised on new product
development
Total (I+II+III+IV)
III
IV
Actual return on plan assets
2012-13
44.00
33.51
(23.31)
30.36
0.33
(0.06)
(0.03)
2011-12
49.53
27.68
(22.23)
30.41
0.02
(1.37)
–
–
5.71
(0.78)
89.73
73.07
9.41
7.18
0.07
89.73
38.08
–
2.11
(0.60)
85.55
72.25
14.70
(1.40)
–
85.55
22.63
2012-13
7.33
8.50
–
9.13
3.77
–
–
–
–
–
28.73
2011-12
7.20
8.22
–
(14.28)
0.18
–
–
–
–
–
1.32
2012-13
0.98
15.45
–
9.14
0.11
–
–
–
–
–
25.68
2011-12
2012-13
2011-12
5.12 138.23 $ 107.94 $
13.27 138.32
– (138.54)
(19.11)
–
–
–
129.56
(129.56)
10.34
–
–
–
12.54
0.11
–
–
–
–
–
10.27
2.00
–
–
–
–
31.04 120.90 128.55
8.29
(0.09)
(0.27)
28.45 138.23
107.94
4.87
15.57
–
28.73
–
–
1.41
–
1.32
–
–
25.95
–
25.68
–
–
2.59
–
(17.33)
–
20.61
–
–
31.04 120.90
– 148.53
–
128.55
139.83
259
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (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)
ii)
iii)
Employer
Employee
Transfer-in/(out)
Add/(less): Actuarial losses/(gains)
Less: Benefits paid
Add: Past service cost
Add: Liabilities assumed on transfer of
employees
Add/(less): Business combination/acquisition
Add: Adjustment for earlier years
Add/(less): Translation adjustments
Closing balance of the present value of
defined benefit obligation
Gratuity plan
As at
31-3-2013
As at
31-3-2012
432.29
44.00
33.51
389.90
49.53
27.68
–
–
0.26 ~
45.13
(68.58)
0.33
–
–
(2.03) ~
30.81
(69.22)
1.62
–
22.75
–
2.80
–
(0.01)
0.39
3.62
Post-retirement medical
benefit plan
As at
31-3-2013
As at
31-3-2012
Company pension plan
Trust-managed
provident fund plan
As at
31-3-2013
As at
31-3-2012
As at
31-3-2013
As at
31-3-2012
crore
94.07
7.33
8.50
–
–
–
9.13
(5.33)
3.59
–
1.66
–
–
97.60
7.20
8.22
–
–
–
(14.28)
(5.08)
–
0.41
–
–
–
184.67
0.98
15.45
–
–
–
9.14
(11.35)
–
–
–
–
–
162.89 1833.45
1615.09
5.12 138.23 $ 107.94 $
129.56
13.27 138.32
–
–
– 232.13
–
–
12.54
(9.12)
(9.15) (287.51)
–
–
–
198.09
–
20.61
(237.84)
–
–
–
–
–
–
13.41
–
–
–
–
–
–
512.49
432.29
118.95
94.07
198.89
184.67 2058.91
1833.45
d) Changes in the fair value of plan assets representing reconciliation of the opening and closing balances thereof are as
follows:
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/(less): Transfer in/(out)
Add: Contribution by Plan participants
Less: Benefits paid
Add: Business combination/disposal (net)
Add: Adjustment for earlier years
Closing balance of the plan assets
crore
Gratuity plan
Trust-managed
provident fund plan
As at
31-3-2013
322.04
23.31
14.77
68.47
(0.28)
–
(68.58)
23.09
0.01
382.83
As at
31-3-2012
327.89
22.23
0.40
38.69
–
–
(69.22)
2.03
0.02
322.04
As at
31-3-2013
1791.04
138.54
9.99
131.92
–
230.66
(287.51)
13.29
–
2027.93
As at
31-3-2012
1583.61
129.56
10.27
110.74
–
194.70
(237.84)
–
–
1791.04
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 [Note Q(10)(ii)(f)(7)].
The Company expects to fund 59.65 crore (previous year: 64.51 crore) towards its gratuity plan and 146.47 crore
(previous year: 114.42 crore) towards its trust-managed provident fund plan during the year 2013-14.
Employer’s and employees’ contribution (net) for March is paid in April.
Employer’s contribution to provident fund
Amount transferred (out)/in on sale/purchase of business undertakings (net) 0.26 crore (previous year: (2.03) crore)
260
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
e)
The major categories of plan assets as a percentage of total plan assets are as follows:
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
Gratuity plan
As at
31-3-2013
29%
15%
26%
2%
As at
31-3-2012
35%
10%
16%
3%
Trust-managed provident
fund plan
As at
31-3-2013
24%
13%
7%
–
As at
31-3-2012
24%
12%
7%
–
–
1%
20%
7%
–
1%
29%
6%
14%
–
42%
–
17%
–
40%
–
f)
Principal actuarial assumptions at the Balance Sheet date (expressed as weighted averages):
1
2
3
4
Post-retirement medical benefit plan
Discount rate:
a) Gratuity plan
b) Company pension plan
c)
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
31-3-2013
As at
31-3-2012
8.09%
8.09%
8.09%
7.50%
5.00%
5.00%
6.00%
8.59%
8.59%
8.59%
7.50%
5.00%
5.00%
6.00%
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 6% (previous year: 1% to 6%) for various age groups.
6.
7.
8.
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 Statement of Profit and Loss 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.
9. 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:
crore
Particulars
Effect of 1% increase
Effect of 1% decrease
2012-13
2011-12
2012-13
2011-12
Effect on the aggregate of the service cost and
interest cost
Effect on defined benefit obligation
3.47
13.02
2.46
9.43
(2.66)
(10.32)
(1.91)
(7.57)
261
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
g)
The amounts pertaining to defined benefit plans are as follows:
Particulars
As at
31-3-2013
As at
31-3-2012
As at
31-3-2011
As at
31-3-2010
As at
31-3-2009
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
4
Post-retirement pension plan (unfunded)
Defined benefit obligation
Experience adjustment plan liabilities
Trust managed provident fund plan (funded)
117.70
0.69
512.49
382.83
(133.64)
26.18
(13.96)
92.64
(6.62)
432.29
322.04
(110.39)
30.18
(0.19)
198.36
(2.79)
184.03
23.21
95.99
7.91
389.90
327.89
(61.99)
30.37
4.38
162.14
17.46
82.55
5.73
358.27
294.56
(63.71)
30.67
2.29
135.61
(4.11)
74.40
1.13
290.67
255.06
(35.61)
8.38
13.05
151.80
(6.89)
Defined benefit obligation
Plan assets
Surplus/(deficit)
2058.91
2027.93
(30.98)
1833.45
1791.04
(42.41)
1615.09
1583.61
(31.48)
1364.97
1350.42
(14.55)
1127.81
1151.80
23.99
h) General descriptions of defined benefit plans:
1. Gratuity plan:
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 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.
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 Statement of Profit and Loss as actuarial loss. Any loss/gain arising out of the investment
risk and actuarial risk associated with the plan is also recognised as expense or income in the period in which such
loss/gain occurs. Further, the provision of 20.61 crore, which was created in 2011-12 based on actuarial valuation
towards the future obligation arising out of interest rate guarantee associated with the plan, has been reversed in
the current year, because the balance in surplus account of the fund is higher than the interest obligation of 11.50
crore as on March 31, 2013.
Q(11) Disclosure pursuant to Accounting Standard (AS) 17 ‘’Segment Reporting’’
a) During the year ended March 2013, Technology Services, a business segment earlier classified as “Others”, has crossed the
threshold norm for reportable segment provided in AS 17. Accordingly, in compliance with AS 17, Technology Services has been
262
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
disclosed as a separate segment for the year ended March 31, 2013 and the related segment figures for the corresponding
previous year have been regrouped.
b)
Information about business segments (information provided in respect of revenue items for the year ended March 31, 2013 and
in respect of assets/liabilities as at March 31, 2013–denoted as “CY” below, previous year denoted as “PY”)
i.
Primary segments (business segments):
Particulars
Engineering
& construction
Electrical
& electronics
CY
PY
CY
PY
Machinery
& industrial
products
CY
IT & Technology
Services
Financial services
Developmental projects
Others
Elimination
Total
PY
CY
PY
CY
PY
CY
PY
CY
PY
CY
PY
CY
PY
crore
Revenue–including
excise duty
External
Inter-segment
Total revenue
Result
Segment result
Inter-Segment margins on
capital jobs
Unallocated corporate income/
(expenditure) (net)
Operating Profit (PBIT)
Interest expense
Interest income
Profit before tax (PBT) (before
extraordinary items)
Profit from extraordinary items
Profit before tax (PBT) (after
extraordinary items)
Provision for current tax
Provision for deferred tax
Profit after tax
Additional tax on dividend
distributed/proposed by
subsidiary companies
Share in profit of
associates
Minority interest in income in
subisidiaries
Profit after tax, minority
interests and share
of profit of associates
Other information
Segment assets
Unallocable corporate assets
Total assets
Segment liabilities
Unallocable corporate liabilities
Total liabilities
Capital expenditure
Depreciation, amortisation,
impairment & obsolescence
included in segment expense
Reversal of accumulated
amortisation of goodwill on
consolidation
Non-cash expenses other
than depreciation included in
segment expense
57667.12
949.10
58616.22
49785.79
1714.11
51499.90
4314.03
531.90
4845.93
3933.65
369.37
4303.02
2742.77 3203.58
170.34
137.17
2879.94 3373.92
4961.84
36.94
4998.78
3910.50
64.97
3975.47
4079.78
–
4079.78
2997.09
26.79
3023.88
1397.09
8.58
1405.67
1066.55
47.73
1114.28
32.68
19.65
52.33
62.92
19.57
82.49
–
1683.34
1683.34
–
2412.88
2412.88
75195.31
–
75195.31
64960.08
–
64960.08
6050.81
5739.83
546.53
428.16
457.75
533.30
1107.31
715.33
848.08
556.02
411.60
216.72
7.67
(14.17)
–
–
9429.75
8175.19
(104.87)
9324.88
(214.92)
7960.27
(159.60)
9165.28
(2095.02)
489.55
(258.83)
7701.44
(1215.85)
487.92
7559.81
78.11
6973.51
–
7637.92
(2241.79)
(143.75 )
5252.38
6973.51
(2314.33)
31.78
4690.96
(12.96)
(8.67)
38.43
46.16
(72.18)
(34.76)
5205.67
4693.69
131736.64 106293.16
11368.41
13018.14
143105.05 119311.30
59679.51
69956.02
28491.55
36636.47
88171.06
106592.49
263
52170.19
45548.07
3657.66
3411.03
2146.02
1936.45
3218.49
2693.99
36592.88
26999.59
33755.00
25484.73
196.40
219.30
29782.27
29036.44
1539.90
1356.23
943.27
952.78
870.17
793.04
30141.86
21984.46
6658.32
5473.48
20.23
83.08
2395.87
3932.86
238.51
187.30
193.53
75.68
236.99
279.31
774.85
251.89
5325.20
3461.29
0.22
53.86
985.36
759.22
94.74
108.13
43.14
47.17
140.48
121.13
85.39
79.54
580.98
395.71
12.97
9.93
(22.75)
–
(95.79)
–
(16.49)
–
(55.20)
–
(7.25)
–
(144.17)
–
–
–
115.89
180.33
5.63
8.41
1.98
6.09
6.76
11.61
2.92
4.07
1.58
1.27
0.22
0.63
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
ii)
Secondary segments (geographical segments):
crore
Particulars
Domestic
Overseas
Total
CY
PY
CY
PY
CY
PY
External revenue by location of customers
55313.36
51703.76 19881.95
13256.32 75195.31
64960.08
Carrying amount of segment assets by location
of assets
Cost incurred on acquisition of tangible and
intangible fixed assets
120238.55
99780.65 11498.09
6512.51 131736.64 106293.16
8739.69
7834.96
425.47
407.23
9165.16
8242.19
c)
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. 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.
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” as specified in the Companies (Accounting Standards) Rules, 2006.
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
components, custom built low and medium voltage switchboards, electronic energy meters/protection (relays)
systems, control & automation products and medical equipment (upto the date of sale).
• Machinery & industrial products segment comprises manufacture and sale of rubber processing machinery
& castings, manufacture and marketing of industrial valves, construction equipment and industrial products
and marketing of welding products (previous year). It also includes manufacture and sale of plastic processing
machinery (upto date of sale of stake), manufacture and sale of undercarriage assemblies, manufacture and sale
of welding and cutting equipment.
•
•
Financial services segment comprises retail and corporate finance, housing finance, infrastructure finance,
general insurance, asset management of mutual fund schemes and related advisory services.
Developmental projects segment comprises development, operation and maintenance of basic infrastructure
projects, toll collection including annuity based projects, development of urban infrastructure, power development,
development and operation of port facilities and providing related advisory services.
•
IT & Technology Services segment comprises information technology and integrated engineering services.
• Others include ready-mix concrete, mining and aviation.
264
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Q(12) Disclosure of related parties/related party transactions pursuant to Accounting Standard (AS) 18 ‘’Related Party Disclosures’’:
i.
Names of the related parties with whom transactions were carried out during the year and description of relationship:
Associate companies:
1 Audco India Limited @
3 L&T-Chiyoda Limited
2 Salzer Electronics Limited
4 L&T-Komatsu Limited
5 L&T-Ramboll Consulting Engineers Limited
6 Magtorq Private Limited
7 JSK Electricals Private Limited
9 Vizag IT Park Limited
11 L&T Arun Excello Realty Private Limited
8 AIC Structural Steel Construction (India) Private Limited
10 Feedback Infrastructure Services Private Limited
@ Associate became a wholly owned subsidiary w.e.f. March 28, 2013
Joint ventures:
1 Metro Tunneling Group
3 Desbuild L&T Joint Venture
2 L&T-Hochtief Seabird Joint Venture
4 L&T-Shanghai Urban Construction (Group) Corporation
Joint Venture
5 L&T-AM Tapovan Joint Venture
6 HCC-L&T Purulia Joint Venture
7 The Dhamra Port Company Limited
8 Metro Tunneling Delhi-L&T SUCG Joint Venture
9 Metro Tunneling Chennai L&T SUCG Joint Venture
10 L&T-Eastern Joint Venture
11 L&T-Shapoorji Pallonji & Company Limited Joint
12 L&T-Shanghai Urban Construction (Group) Joint
Venture-TCS
Venture CC27 Delhi *
13 International Metro Civil Contractors
* The joint venture has been entered into on November 05, 2012. Funds yet to be infused in the joint venture.
Key management personnel & their relatives:
1 Mr. A. M. Naik (Group Executive Chairman)
2 Mr. K. Venkataramanan (CEO & Managing Director)
Mrs. Jyothi Venkataramanan (wife)
3 Mr. V. K. Magapu (Whole-time Director)*
4 Mr. M. V. Kotwal (Whole-time Director)
5 Mr. S. N. Subrahmanyan (Whole-time Director)
6 Mr. R. Shankar Raman (CFO & Whole-time Director)
7 Mr. S. N. Roy (Whole-time Director)
8 Mr. Ravi Uppal (Whole-time Director)**
* Retired w.e.f. the close of working hours of September 30, 2012
** Ceased to be a director w.e.f. the close of working hours of September 15, 2012
ii. Disclosure of related party transactions:
Sr.
no.
1
Nature of transaction/relationship/major parties
Purchase of goods & services (including commission paid)
Associates & joint ventures, including:
Audco India Limited
Salzer Electronics Limited
Total
2012-13
2011-12
Amount Amounts for
major parties
Amount Amounts for
major parties
crore
830.64
746.39
587.68
118.75
830.64
746.39
493.83
106.44
265
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
2012-13
2011-12
Amount Amounts for
major parties
Amount Amounts for
major parties
crore
Sr.
no.
Nature of transaction/relationship/major parties
2
Sale of goods/contract revenue & services
Associates & joint ventures, including:
The Dhamra Port Company Limited
Total
3
Purchase/lease of fixed assets
Associate:
L&T-Komatsu Limited
Total
4
Subscription to equity and preference shares
Associates including:
AIC Structural Steel Construction (India) Private Limited
L&T-Komatsu Limited
L&T Arun Excello Realty Private Limited
Total
5
Receiving of services from related parties
Associates & joint ventures, including:
L&T-Chiyoda Limited
Total
6
Rent paid, including lease rentals under leasing/hire purchase
arrangements including loss sharing on equipment finance
Associates:
Audco India Limited
L&T-Komatsu Limited
Key management personnel
Total
47.75
47.75
3.76
3.76
0.03
0.03
6.65
6.65
2.01
0.01
2.02
43.17
3.76
0.03
–
–
6.48
0.66
1.35
100.91
100.91
1.74
1.74
119.02
119.02
5.94
5.94
0.86
0.02
0.88
7
Charges for deputation of employees to related parties
Associates & joint ventures, including:
58.32
64.32
Audco India Limited
L&T-Komatsu Limited
L&T-Chiyoda Limited
16.31
5.93
35.34
Total
58.32
64.32
266
99.97
1.74
–
60.00
29.14
5.94
–
0.86
13.86
7.52
29.61
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Sr.
no.
8
Nature of transaction/relationship/major parties
Dividend received
Associates & joint ventures, including:
L&T-Komatsu Limited
Audco India Limited
Feedback Infrastructure Services Private Limited
L&T-Ramboll Consulting Engineers Limited
Vizag IT Park Limited
Magtorq Private Limited
Total
9
Commission received, including those under agency arrangements
Associate:
L&T-Komatsu Limited
Total
10
Rent received, overheads recovered and miscellaneous income
Associates & joint ventures, including:
Audco India Limited
L&T-Chiyoda Limited
L&T-Komatsu Limited
Total
11
Interest received
Joint venture:
The Dhamra Port Company Limited
Key management personnel
Total
12
Interest paid
Associates:
Audco India Limited
Total
13
Payment of salaries/perquisites (other than commission)
Key management personnel:
A.M. Naik
Y.M. Deosthalee ^^^
K.Venkataramanan
K.V. Rangaswami
V. K. Magapu * ^^^^
M. V. Kotwal
Ravi Uppal **^^
S. N. Subrahmanyan
R. Shankar Raman
S. N. Roy
2012-13
2011-12
Amount Amounts for
major parties
Amount Amounts for
major parties
crore
4.61
25.35
25.35
187.96
187.96
5.61
5.61
26.99
0.01
27.00
4.24
4.24
20.91
4.61
138.68
138.68
6.02
6.02
41.62
–
41.62
–
–
–
21.72
–
–
0.66
1.80
1.19
0.63
138.68
–
3.56
–
41.62
3.61
–
2.58
–
7.40
1.89
2.05
1.52
1.37
1.30
13.20
9.38
–
–
–
–
187.96
0.70
4.23
0.47
26.99
4.24
2.68
7.24
1.59
3.75
1.32
1.42
1.33
0.93
0.62
0.03
267
Total
21.72
20.91
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Sr.
no.
14
Nature of transaction/relationship/major parties
Commission to directors [Note Q(12)(iii)] @
Key management personnel:
2012-13
2011-12
Amount Amounts for
major parties
Amount Amounts for
major parties
crore
51.82
49.33 $
A. M. Naik
Y. M. Deosthalee
K. Venkataramanan
K. V. Rangaswami
V. K. Magapu *
M. V. Kotwal
Ravi Uppal **
S. N. Subrahmanyan
R. Shankar Raman
S. N. Roy
17.45
–
10.47
–
2.82
3.64
1.71
7.01
5.53
3.19
Total
51.82
49.33
Retired w.e.f. the close of working hours of September 30, 2012
*
** Ceased to be director w.e.f. the close of working hours of September 15, 2012
^^
Includes leave encashment payment of 1.25 crore
^^^ Includes leave encashment payment of 6.67 crore
^^^^ Includes leave encashment payment of 6.54 crore
$
@
Out of total provision of 53.45 crore made during 2011-12, an amount of 4.12 crore was reversed during 2012-13.
Commision to directors comprises of:
Sr.
no.
1
2
3
Particulars
Commission
Contribution to provident fund on commission
Contribution to superannuation fund on commission
Total
2012-13
40.80
4.90
6.12
51.82
15.06
2.96
6.53
1.36
5.44
5.05
5.28
4.66
2.71
0.28
crore
2011-12
38.84
4.66
5.83
49.33
“Major parties” denote entities accounting for 10% or more of the aggregate for that category of transaction during respective period.
iii. Amount due to/from related parties:
Sr.
No.
1 Accounts receivable
Nature of transaction/relationship/major parties
Associates & joint ventures, including:
The Dhamra Port Company Limited
Total
2
Accounts payable (including acceptance & interest accrued)
Associates & joint ventures, including:
Audco India Limited
L&T-Chiyoda Limited
Salzer Electronics Limited
Total
268
As at 31-3-2013
As at 31-3-2012
Amount Amounts for
major parties
Amount Amounts for
major parties
crore
71.98
71.98
45.61
70.81
–
16.43
18.87
79.43
79.43
202.22
73.56
134.69
27.70
20.80
45.61
202.22
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Sr.
No.
Nature of transaction/relationship/major parties
3
Loans & advances recoverable
Associates & joint ventures, including:
The Dhamra Port Company Limited
Key management personnel
Total
4
Due to whole-time directors [Note Q(12)(iii)]
Key management personnel:
A. M. Naik
Y. M. Deosthalee
K. Venkataramanan
K.V. Rangaswami
V. K. Magapu *
M. V. Kotwal
Ravi Uppal **
S. N. Subrahmanyan
R. Shankar Raman
S. N. Roy
As at 31-3-2013
As at 31-3-2012
Amount Amounts for
major parties
Amount Amounts for
major parties
crore
472.49
0.01
472.50
40.80
453.41
13.74
–
8.24
–
2.22
2.87
1.35
5.52
4.35
2.51
387.35
0.29
387.64
38.84 $
367.67
11.86
2.33
5.14
1.07
4.28
3.98
4.16
3.67
2.13
0.22
Total
40.80
38.84
Retired w.e.f. the close of working hours of September 30, 2012
*
** Ceased to be director w.e.f. the close of working hours of September 15, 2012
$
Out of total commission due to whole-time directors of 42.08 crore during 2011-12, an amount of 3.24 crore was reversed
during 2012-13.
“Major parties” denote entities who account for 10% or more of the aggregate for that category of transaction during respective period.
iv. Notes to related party transactions:
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, 2011 in line with Government of India (GOI) approval letter dated November 17, 2011. The appointment shall
be in effect as long as the joint venture agreement between the Parent Company and M/s Komatsu Asia Pacific Pte. Limited,
Singapore (which is a subsidiary of Komatsu Limited, 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 financial impact of the aforesaid agreement has been included in/disclosed vide Note Q(12)(ii) supra.
Q(13) Disclosure in respect of leases pursuant to Accounting Standard (AS) 19 ‘’Leases’’:
i. Where the Company is a lessor:
(a) Finance leases:
i)
The Company has given certain assets on finance leases. 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.
269
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
ii)
The total gross investment in these leases as on March 31, 2013 and the present value of minimum lease payments
receivable as on March 31, 2013 is as under:
Particulars
i.
ii.
Receivable not later than 1 year
Receivable later than 1 year and not later than 5 years
iii. Receivable later than 5 years
Gross investment in lease (i+ii+iii)
Less: Unearned finance income
Present value of receivables
crore
As at
31-3-2013
As at
31-3-2012
64.56
112.66
0.24
177.46
31.68
145.78
69.59
130.25
1.85
201.69
39.06
162.63
iii)
In respect of one of the leases referred to in Note Q(13)(I)(a)(i), the lease receivables were recorded at the inception,
at the present value of minimum lease payments, and subsequently securitised.
(b) Operating leases:
i)
The Company has given assets under non-cancellable operating lease, the future minimum lease payments receivable
in respect of which, as at March 31, 2013 are as follows:
Particulars
i.
ii.
Receivable not later than 1 year
Receivable later than 1 year and not later than 5 years
iii. Receivable later than 5 years
Total
ii) Where the Company is a lessee:
(a) Finance leases:
crore
As at
31-3-2013
As at
31-3-2012
73.36
109.09
0.12
182.57
66.77
93.61
–
160.38
i)
Assets acquired on finance lease mainly comprise plant and equipment, 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.
ii)
The minimum lease rentals as at March 31, 2013 and the present value as at March 31, 2013 of minimum lease
payments in respect of assets acquired under finance leases are as follows:
Particulars
Payable not later than 1 year
Payable later than 1 year and not later than 5 years
i.
ii.
iii. Payable later than 5 years
Total
Less: Future finance charges
Present value of minimum lease payments
crore
Present value of minimum
lease payments
As at
31-3-2013
0.26
0.25
–
0.51
As at
31-3-2012
0.32
0.49
–
0.81
Minimum lease payments
As at
31-3-2013
0.30
0.29
–
0.59
0.08
0.51
As at
31-3-2012
0.37
0.57
–
0.94
0.13
0.81
iii) Contingent rent recognised/(adjusted) in the Statement of Profit and Loss in respect of finance leases: Nil (previous
year: Nil).
270
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
(b) Operating leases:
i)
The Company has taken various commercial premises and plant and equipment 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, 2013 are as follows:
Particulars
i.
ii.
Payable not later than 1 year
Payable later than 1 year and not later than 5 years
iii. Payable later than 5 years
Total
crore
As at
31-3-2013
As at
31-3-2012
28.06
32.18
60.12
120.36
51.57
95.42
150.68
297.67
[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: 138.40 crore (previous year: 165.88 crore)
iv) Contingent rent recognised in the Statement of Profit and Loss: Nil (previous year: 0.01 crore)
Q(14) 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
2012-13
2011-12
2012-13
2011-12
Basic
Profit after tax as per accounts ( crore)
Weighted average number of shares outstanding
Basic EPS ( )
Diluted
Profit after tax as per accounts ( crore)
Add: Interest/exchange difference (gain)/loss on
bonds convertible into equity shares
(net of tax) ( crore)
A
B
A/B
A
B
5134.06
4693.69
5205.67
4693.69
61,39,26,551 61,11,08,916 61,39,26,551 61,11,08,916
83.63
76.81
84.79
76.81
5134.06
4693.69
5205.67
4693.69
–
–
–
–
Adjusted profit for diluted earnings per share ( crore) C=A+B
5134.06
4693.69
5205.67
4693.69
Weighted average number of shares outstanding
Add: Weighted average number of potential equity
D
E
61,39,26,551 61,11,08,916 61,39,26,551 61,11,08,916
shares on account of employee stock options
50,50,853
58,66,093
50,50,853
58,66,093
Weighted average number of shares outstanding
for diluted EPS
Diluted EPS ( )
Face value per share ( )
F=D+E
61,89,77,404 61,69,75,009 61,89,77,404 61,69,75,009
C/F
82.94
2
76.08
2
84.10
2
76.08
2
Note: Potential equity shares that could arise on conversion of FCCBs are not resulting into dilution of EPS in the current year. Hence,
they have not been considered in working of diluted EPS in accordance with Accounting Standard (AS) 20 ‘’Earnings Per Share’’.
271
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Q(15) Major components of deferred tax liabilities and deferred tax assets pursuant to Accounting Standard (AS) 22‘’Accounting for Taxes
on Income‘’:
Particulars
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
Statement of Profit and Loss
Disputed statutory liabilities paid and claimed
as deduction for tax purposes but not
debited to Statement of Profit and Loss
Other items giving rise to timing differences
Total
Deferred tax (assets):
Provision for doubtful debts and advances
debited to Statement of Profit and Loss
Loss on derivative transactions to be claimed
for tax purposes in the year of transfer to
Statement of Profit and Loss
Unpaid statutory liabilities/provision for
compensated absences debited to
Statement of Profit and Loss
Unabsorbed depreciation/brought forward
business losses
Difference between book and tax depreciation
Other items giving rise to timing differences
Total
Net deferred tax liability/(assets)
Previous year
Deferred tax
liabilities/
(assets) as at
31-3-2012
Charge/
(credit) to
Statement
of Profit and
Loss
Effect due to
acquisition/
disposal
Netted off
against
unamortised
borrowing
cost
Charge/(credit) to reserves
Hedging
reserve *
Foreign
currency
translation
reserve
crore
Deferred tax
liabilities/
(assets) as at
31-3-2013
703.19
329.14
6.35
1.76
0.03
–
55.65
91.54
852.14
26.67
74.93
430.77
–
4.60
10.95
(321.46)
54.78
(14.00)
(146.57)
–
–
(120.49)
(62.98)
(2.88)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1038.68
21.82
23.61
–
–
21.82
82.32
171.07
1315.68
–
(280.68)
(49.89)
(196.46)
–
(186.35)
(108.76)
(2.03)
(70.99)
(770.30)
81.84
310.93
(209.08)
(15.06)
(54.68)
(287.02)
143.75
(31.78)
(3.59)
(0.54)
(3.52)
(24.53)
(13.58)
–
–
–
–
–
–
(26.53)
–
–
(0.27)
(0.27)
(0.27)
(0.62)
–
–
–
(49.89)
(28.07)
(170.16)
(321.43)
(17.63)
(129.46)
(1132.01)
183.67
81.84
* The amount of 611.70 crore (previous year: 581.79 crore) representing net(gains)/losses on effective hedges recognised in hedge
reserve, applying the principles of hedge accounting set out in Accounting Standard (AS) 30 ‘’Financial Instruments: Recognition and
Measurement’’. The amount is after considering the net deferred tax asset of 28.07 crore (previous year: 170.16 crore).
Q(16) The effect of acquisitions (including newly incorporated subsidiaries) and disposals during the year on the Consolidated Financial
Statements is as under:
a) Acquisitions(including newly incorporated):
Sr.
No.
1
2
3
4
5
Name of company
L&T East-West Tollway Limited
L&T Great Eastern Highway Limited
Bond Instrumentation And Process Control Limited
Servowatch Inc
Servowatch Systems Limited
Effect on Group profit/(loss)
after minority interest for the
period ended March 31, 2013
(0.43)
(0.28)
(1.47)
(1.69)
(7.40)
crore
Net assets as at
March 31, 2013
14.71
11.99
–
(0.33)
(4.84)
272
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Sr.
No.
Name of company
Thalest Limited
L&T Geostructure LLP
Larsen Toubro Arabia LLC
Henikwon Corporation SDN.BHD
Larsen & Toubro Infotech South Africa (Pty) Limited
6
7
8
9
10
11 Consumer Financial Services Limited
12
13
14
15
16
17
18
19
20 Audco India Limited
21 CSJ Hotels Private Limited
Family Credit Limited
L&T Housing Finance Limited
L&T Fund Management Private Limited
L&T Trustee Services Private Limited
L&T Capital Markets Limited
L&T Infra Debt Fund Limited
L&T Technology Services Limited
L&T Tejomaya Limited
Total
b) Disposals:
Effect on Group profit/(loss)
after minority interest for the
period ended March 31, 2013
2.09
1.00
(0.24)
(3.38)
0.16
–
21.11
0.17
0.29
0.14
(1.31)
–
–
(0.01)
–
–
8.75
crore
Net assets as at
March 31, 2013
17.01
1.35
14.16
14.83
0.49
0.37
198.67
122.50
634.72
0.42
0.96
–
0.05
0.04
311.13
0.01
1338.24
Sr.
No.
1
2
3
4
Name of company
L&T Commercial Projects Private Limited
Jiangsu Shengye Valve Company Ltd.
Larsen & Toubro (Wuxi) Electric Company
Limited
L&T Plastics Machinery Limited
Total
Effect on Group profit/(loss) after
minority interest for the period
ended March 31
2012-13
(2.06)
(1.78)
(0.62)
2011-12
(8.92)
(0.36)
(2.02)
1.48
(2.98)
4.66
(6.64)
crore
Net assets as at
March 31, 2012
Net assets as
at the date of
disposal (during
2012-13)
19.71
33.73
34.90
29.20
117.54
21.62
35.51
35.52
27.73
120.38
Q(17) The Company’s share in respect of the assets, liabilities, reserves, income and expenses, related to its interests in the jointly controlled
entities, incorporated in the Consolidated Financial Statements are:
I
Assets
Non-current assets
Particulars
1
Fixed assets
(a) Tangible assets
(b) Intangible assets
(c) Capital work-in-progress
Long term loans and advances
Other non-current assets
2
3
31-3-2013
crore
31-3-2012
1740.94
1618.20
2.46
48.50
41.52
0.38
3.14
110.30
49.60
–
273
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
1
2
3
4
5
1
2
1
2
3
4
1
2
1
2
3
4
5
6
1
2
3
1
2
II
Liabilities
III
IV
V
Reserves
Income
Expenses
VI
Contingent
liability
VII
Capital
Commitments
Particulars
Current assets
Inventories
Trade receivables
Cash and bank balances
Short term loans and advances
Other current assets
Non-current liabilities
Long term borrowings
Other long term liabilities
Current liabilities
Short term borrowings
Trade payables
Other current liabilities
Short term provisions
Revenue from operations
Other income
Operating expenses
Staff expenses
Sales, administration and other expenses
Interest expense
Depreciation and amortisation
Provision for tax
Contingent liabilities, if any, incurred in relation to interests in joint ventures
Share in contingent liabilities of joint ventures themselves for which the
Company is contingently liable
Contingent liabilities in respect of liabilities of other ventures of joint
ventures
Capital commitments, if any, in relation to interests in joint ventures
Share in capital commitments of joint ventures themselves for which the
Company is contingently liable
31-3-2013
crore
31-3-2012
17.35
187.30
153.52
246.66
82.43
1674.45
11.79
32.63
333.38
436.19
34.34
(143.78)
676.65
9.68
490.86
23.87
40.57
201.82
106.90
4.77
–
67.48
–
8.55
37.18
8.86
87.39
84.73
250.92
48.30
1589.82
2.15
15.71
228.32
215.31
31.30
102.54
299.94
2.14
248.20
16.82
26.50
169.23
88.68
0.86
–
61.43
–
24.18
28.56
Q(18) Disclosures pursuant to Accounting Standard (AS) 29 “Provisions, Contingent Liabilities and Contingent Assets”:
a) Movement in provisions:
Sr.
no.
Particulars
1 Balance as at 01-04-2012
2
3
4
Additional provision during the year
Provision used/reversed during the year
Adjustments pursuant to acquisition of
subsidiaries (net of transfer of business)
Translation adjustments
Balance as on 31-03-2013 (6=1+2-3+4+5)
5
6
Product
warranties/
liquidity
damages
14.72
11.98
(9.69)
38.70
–
55.71
Expected
tax liability
in respect
of indirect
taxes
60.99
21.52
(2.65)
–
–
79.86
crore
Others
Total
Class of provisions
Litigation
related
obligations
Periodic
major
maintenance
Contractual
rectification
cost-
construction
contracts
14.82
8.21
(13.82)
–
0.38
9.59
33.96
19.85
–
–
–
53.81
428.02
141.54
(255.95)
53.56 606.07
204.69
(335.00) ##
1.59
(52.89) #
–
–
313.61
–
–
2.26
38.70
0.38
514.84
# Being reversal of an extraordinary item included in opening provision [Note Q6(a) supra]
## Includes provision used during the year 1.80 crore (previous year: 14.71 crore)
274
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
b) Nature of provisions:
i.
Product warranties/liquidity damages: 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,
2013 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. Liquidity damages represent
the estimated cost the Company is likely to incur due to delay in delivery as per its contract obligations and accrued on the
basis of advice from distributors/customers.
ii.
Expected tax liability in respect of indirect taxes represents mainly the differential sales tax liability on account of non-
collection of declaration forms for the period prior to 5 years.
iii. Provision for litigation related obligations represents liabilities that are expected to materialise in respect of matters in
appeal.
iv.
Periodic major maintenance represents provision made for resurfacing obligations in accordance with the terms of concession
agreement with National Highway Authority of India (NHAI).
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
(Revised) “Construction Contracts”.
vi. Others mainly represent residual provision in respect of Company’s investment in shares of Satyam Computer Services
Limited.
c) Disclosures in respect of contingent liabilities are given as part of Note [I] to the Balance Sheet.
Q(19) 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, 2013 are as under:
Category of derivative instruments
i)
For hedging foreign currency risks:
crore
Amount of exposures hedged
As at
31-3-2013
As at
31-3-2012
a)
b)
Forward contracts for receivables including firm commitments and highly probable
forecasted transactions
12109.45
14059.90
Forward contracts for payables including firm commitments and highly probable
forecasted transactions
11855.20
9779.10
c) Currency swaps
d) Option contracts
e) Currency futures
ii)
For hedging interest rate risks:
Interest rate swaps
iii)
For hedging commodity price risks:
Commodity futures
b) Unhedged foreign currency exposures as at March 31, 2013 are as under:
Unhedged foreign currency exposures
4949.06
5483.88
217.42
–
433.24
330.69
251.45
235.65
242.59
328.37
crore
As at
31-3-2013
As at
31-3-2012
i)
ii)
Receivables, including firm commitments and highly probable forecasted transactions
36051.91
32180.55
Payables, including firm commitments and highly probable forecasted transactions
32288.98
30534.20
275
Notes forming part of the Consolidated Accounts (contd.)
NOTE [Q] (contd.)
Q(20) 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
35 years. At the end of the said concession period, the entire facilities are transferred to the concerned government authorities.
b.
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 2359.53 crore (previous year: 1993.32 crore) and 317.26 crore (previous
year: 287.95 crore) respectively [Note R(3)(A)(a)(ix)].
c.
Loans and advances include 420.50 crore (previous year: 454.83 crore) being cumulative construction costs incurred including
related margins in respect of annuity based Build-Operate-Transfer (BOT) projects.
Q(21) 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 companies which are not subsidiaries of any other company
amounting to 102.72 crore, relating to dividend of 633.23 crore declared by them.
Q(22) Deferred payment liability of 3953.98 crore (previous year: 4417.67 crore) represents:
a. Negative grant/additional concession fee of
3154.73 crore (previous year: 3237.15 crore) payable to National Highway
Authority of India (NHAI), as per the concession agreement entered into with NHAI.
b. Commitment payable to National Housing Development Authority (NHDA) amounting to
6.99 crore (previous year: 6.60
crore) as per the joint venture agreement entered into with NHDA.
c. Deferred conversion fee liability of
69.26 crore (previous year: 88.92 crore) towards conversion of land from Industrial to
commercial use as per the approval from Chandigarh Housing Board (CHB).
d.
723.00 crore (previous year: 1085.00 crore) payable to City and Industrial Development
Lease premium amounting to
Corporation of Maharashtra (CIDCO) pursuant to conferment of development-cum-leasehold rights to execute the lease deed
for land.
In respect of the total amount of 3953.98 crore, an amount of 472.53 crore (previous year: 464.09 crore) is payable within a
period of one year.
Q(23) One of the subsidiaries, which has been awarded a Build-Operate-Transfer (BOT) project for construction of a bypass toll road and a
bridge over the River Noyyal in Coimbatore District of Tamil Nadu State, under the Concession Agreement dated October 3, 1997,
had received a termination notice from the Ministry of Surface Transport, Government of India. The ground of termination was
Government of India’s subsequent intention to go for four-laning of the existing two lane road. The subsidiary has obtained injunction
from Delhi High Court against the said notice of the Government and is accordingly continuing to collect the toll. The tolling rights
of the subsidiary are protected under the aforesaid concession agreement.
The subsidiary had filed an application opting for arbitration for resolution of disputes and an Arbitral Tribunal has been constituted as
provided in the concession agreement. The Company has submitted the Statement of Claims before the Arbitral Tribunal and hearings
are in progress. Pending outcome of the Arbitration, the subsidiary has filed an application under Section 9 of the Arbitration and
Conciliation Act, 1996 before the Delhi High Court to continue the operations. Pleadings have been completed during the current
year on the said application and the matter is now posted for arguments before the Hon’ble High Court.
Q(24) (a) The Company has adopted a new accounting policy [Note R(20)(g)] for separate accounting of embedded derivatives with effect
from April 1, 2012, for more appropriate presentation of the financial statements. The profit before tax is higher by 189.44
crore pursuant to adoption of the new accounting policy for separate accounting of embedded derivatives.
(b) The Company has changed the accounting policy for recognition of revenue from real estate development transactions pursuant
to the Guidance Note on Accounting for Real Estate Transactions (Revised 2012) issued by the Institute of Chartered Accountants
of India [Note R(3)(A)(a)(iii)]. The profit before tax of the company is higher by 2.39 crore pursuant to change in the accounting
policy of revenue recognition for real estate development transactions.
Q(25) There are no amounts due and outstanding to be credited to Investor Education & Protection Fund as at March 31, 2013.
Q(26) Figures for the previous year have been regrouped/reclassified wherever necessary.
276
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES
1. Basis of accounting
The Company maintains its accounts on accrual basis following the historical cost convention [except for the revaluation of certain fixed
assets], in accordance with generally accepted accounting principles [“GAAP”] 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. Further, the guidance notes/announcements issued by the Institute of Chartered Accountants of India (ICAI) are also
considered, wherever applicable, except to the extent where compliance with other statutory promulgations viz. SEBI guidelines
override the same requiring a different treatment.
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, allowance 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. Presentation of financial statements
The Balance Sheet and the Statement of Profit and Loss are prepared and presented in the format prescribed in the Schedule VI to the
Companies Act, 1956 (“the Act”). The Cash Flow Statement has been prepared and presented as per the requirements of Accounting
Standard (AS) 3 “Cash Flow Statements”. The disclosure requirements with respect to items in the Balance Sheet and Statement of
Profit and Loss, as prescribed in the Schedule VI to the Act, are presented by way of notes forming part of accounts along with the
other notes required to be disclosed under the notified Accounting Standards and the Listing Agreement.
Amounts in the financial statements are presented in Indian Rupees in crore [1 crore = 10 million] rounded off to two decimal places
in line with the requirements of Schedule VI. Per share data are presented in Indian Rupees to two decimal places.
3. 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. Revenue from operations
a.
Sales & service
i.
ii.
Sales and service include excise duty and adjustments made towards liquidated damages and price variation, wherever
applicable. Escalation and other claims, which are not ascertainable/acknowledged by customers, are not taken into
account.
Revenue from sale of manufactured and traded 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 which are in substance similar to delivery of goods, 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.
Revenue from those property development activities [Note Q(24)(b)] which have the same economic substance as
construction contract is recognised based on the ‘Percentage of Completion method’ (POC) when the outcome of a
real estate project can be estimated reliably upon fulfillment of all the following conditions:
a. All critical approvals necessary for commencement of the project have been obtained;
b. When the stage of completion of the project reaches a reasonable level of development i.e. contract costs for
work performed bears a reasonable proportion to the estimated total contract costs. For this purpose, a reasonable
level of development is treated as achieved only if the cost incurred (excluding cost of land/developmental rights
and borrowing cost) is at least 25% of the total of such cost;
277
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
c. At least 25% of the saleable project area is secured by contracts or agreements with buyers;
d. At least 10% of the total revenue as per the agreements of sale or any other legally enforceable documents are
realised at the reporting date in respect of each of the contracts and it is reasonable to expect that the parties
to such contracts will comply with the payment terms as defined in the contracts.
The costs incurred on property development activities are carried as “inventories” till such time the outcome of the
project cannot be estimated reliably and all the aforesaid conditions are fulfilled. When the outcome of the project
can be ascertained reliably and all the aforesaid conditions are fulfilled, revenue from property development activity
is recognised at cost incurred plus proportionate margin, using percentage of completion method. Percentage of
completion is determined based on the proportion of actual cost incurred to the total estimated cost of the project.
For this purpose, actual cost includes cost of land and developmental rights but excludes borrowing cost.
Expected loss, if any, on the project is recognised as an expense in the period in which it is foreseen, irrespective of
the stage of completion of the contract.
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: Contract revenue is recognised only to the extent of cost incurred till such time the outcome
of the job cannot be ascertained reliably. When the outcome of the contract is ascertained reliably contract
revenue is recognised at cost of work performed on the contract plus proportionate margin, using the percentage
of completion method. Percentage of completion is the proportion of cost of work performed to-date to the
total estimated contract costs.
Government grants in the nature of subsidy related to customer contracts are recognised as revenue from
operations in the Statement of Profit and Loss, on a prudent basis, in proportion to work completed when there
is reasonable assurance that the conditions for the grant of subsidy will be fulfilled.
Expected loss, if any, on the construction/project related activity is recognised as an expense in the period in
which it is foreseen, irrespective of the stage of completion of the contract. While determining the amount of
foreseeable loss, all elements of costs and related incidental income not included in contract revenue are taken
into consideration.
v.
Revenue from contracts for rendering of services which are directly related to the construction of an asset is recognised
on similar basis as stated in (iv) supra.
vi. Revenue 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.
vii. 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. Unbilled revenue represents value of
services performed in accordance with the contract terms but not billed.
viii. 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. Income from interest-bearing assets is recognised on accrual basis over the life of the
asset based on the constant effective yield. Loan origination income i.e. processing fees and other charges collected
upfront, are recognised at the inception of the loan. Income including interest or any other charges on non-performing
asset is recognised only when realised. Any such income recognised before the asset became non-performing and
remaining unrealised is reversed.
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.
After the completion of construction period, 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
278
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
on accrual basis. Revenue from annuity based projects is recognised in the Statement of Profit and Loss 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 either the proportionate completion method or completed
service contract method, whichever is considered appropriate.
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. Income from investment management fees is recognised in accordance with the Investment Management Agreement
and SEBI regulations based on average Assets Under Management (AUM) of mutual fund schemes over the period
of the agreement in terms of which services are performed. Portfolio management fees are recognised in accordance
with Portfolio Management Agreement entered with respective clients over the period of the agreement in terms of
which the services are rendered. Trusteeship fees are accounted on an accrual basis in accordance with the Trust Deed
and are dependent on the net asset value as recorded by the respective mutual fund schemes.
xiv. Revenue from port operation services including rail infrastructure is recognised on completion of respective services.
xv. Revenue from charter hire is recognised based on the terms of the time charter agreement.
xvi. Insurance premium (net of service tax) is recognised as income over the contract period or period of risk, as appropriate,
after adjusting for unearned premium (unexpired risk) and premium deficiency, if any. Premium deficiency, if any, is
recognised if the sum of expected claim costs and related claim management costs exceed related reserve for unexpired
risk for every line of business. Reserve for unexpired risk is recognised net of reinsurance ceded and represents premium
written that is attributable and to be allocated to succeeding accounting periods for risks to be borne by the Company
under contractual obligations on a contract period basis or risk period basis, whichever is appropriate. It is calculated on
a daily pro-rata basis, written on policies during the twelve months preceding the Balance Sheet date for fire, marine
cargo and miscellaneous business (excluding project related engineering insurance contracts) and 100% for marine
hull business, on all unexpired policies at Balance Sheet date, in accordance with Section 64 V(1)(ii)(b) of the Insurance
Act, 1938. The reserve for unexpired risk is computed for project related engineering insurance contract through the
usage of Cubic Curve Method. A reserve for unexpired risks is recorded at 50% of the net premium retro-ceded to
the Company from India Motor Third Party Insurance Pool (IMTPIP) during the year.
Reinsurance premium ceded is accounted in the year in which the risk commences and over the period of risk in
accordance with the treaty arrangements with the reinsurers. Reinsurance premium ceded on unearned premium
is carried forward to the period of risk and is set off against related unearned premium. Premium on excess of loss
reinsurance cover is accounted as per the terms of the reinsurance arrangements.
Commission on reinsurance ceded is recognised as income on ceding of reinsurance premium.
Profit commission under re-insurance treaties, wherever applicable, is recognised in the year of final determination of
the profits.
Claims incurred comprise claims paid, estimated liability for outstanding claims made following a loss occurrence
reported and estimated liability for claims Incurred But Not Reported (‘IBNR’) and claims Incurred But Not Enough
Reported (‘IBNER’). Further, claims incurred also include specific claim settlement costs such as survey/legal fees and
other directly attributable costs.
Claims (net of amounts receivable from reinsurers/co-insurers) are recognised on the date of intimation based on
estimates from surveyors/insured in the respective revenue accounts. Estimated liability for outstanding claims at
Balance Sheet date is recorded net of claims recoverable from/payable to co-insurers/reinsurers and salvage to the
extent there is certainty of realisation. Estimated liability for outstanding claims is determined by management on
the basis of ultimate amounts likely to be paid on each claim based on the past experience. These estimates are
progressively revalidated on availability of further information. IBNR represents that amount of claims that may have
been incurred during the accounting period but have not been reported or claimed. The IBNR provision also includes
provision, if any, required for claims IBNER. Estimated liability for claims Incurred But Not Reported (‘IBNR’) and claims
Incurred But Not Enough Reported (‘IBNER’) is based on actuarial estimate duly certified by the appointed actuary of
the Company. IBNR/IBNER has been created on reinsurance accepted from Indian Motor Third Party Insurance Pool
(IMTPIP) based on actuarial estimates received from the IMTPIP.
279
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
b. Other operational revenue
Other operational revenue represents income earned from the activities incidental to the business and is recognised when
the right to receive the income is established as per the terms of the contract.
B. Other income
a.
Interest income is accrued at applicable interest rate.
b. Dividend income is accounted in the period in which the right to receive the same is established.
c. Other Government grants, which are revenue in nature and are towards compensation for the related costs, are recognised
as income in the Statement of Profit and Loss in the period in which the matching costs are incurred.
d. Other items of income are accounted as and when the right to receive arises.
4. Principles of consolidation
a.
b.
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
Parent Company’s independent financial statements.
Investments in associate companies have been accounted for, by using 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. The carrying amount of investment in associate companies is reduced to recognise any decline which is other than
temporary in nature and such determination of decline in value, if any, is made for each investment individually. The unrealised
profits/losses on transactions with associate companies are eliminated by reducing the carrying amount of investment.
c. Goodwill on consolidation represents the difference between the Group’s share in the net worth of a subsidiary, an associate or
a joint venture, and the cost of acquisition at each point of time of making the investment in the subsidiary, the associate or the
joint venture as per Accounting Standard (AS) 21 “Consolidated Financial Statements”. For this 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 on consolidation as per Accounting Standard
(AS) 21 ”Consolidated Financial Statements“ is not amortised, however, it is tested for impairment. In the event of cessation of
operations of a subsidiary, associate or joint venture, the unimpaired goodwill is written off fully.
d.
The gains/losses in respect of part dilution of stake in subsidiary companies pursuant to issue of additional shares to minority
shareholders are recognised directly in capital reserve under reserves and surplus in the Balance Sheet. The gains/losses in respect
of part divestment of stake in subsidiary companies pursuant to sale of shares by the holding company are recognised in the
Statement of Profit and Loss.
e.
The Company’s interests in joint ventures are consolidated as follows:
Type of joint venture
Jointly controlled operations
Jointly controlled assets
Jointly controlled entities
Accounting treatment
Company’s share of revenues, common expenses, assets and liabilities are included in
revenues, expenses, assets and liabilities respectively.
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.
The Company’s interest in jointly controlled entities are proportionately 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.
5. Extraordinary and exceptional items
Income or expenses that arise from events or transactions that are clearly distinct from the ordinary activities of the Company are
classified as extraordinary items. Specific disclosure of such events/transactions is made in the financial statements. Similarly, any
external event beyond the control of the Company, significantly impacting income or expense, is also treated as extraordinary item
and disclosed as such.
280
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
On certain occasions, the size, type or incidence of an item of income or expense, pertaining to the ordinary activities of the Company,
is such that its disclosure improves an understanding of the performance of the Company. Such income or expense is classified as an
exceptional item and accordingly disclosed in the notes to accounts.
6. Research and development
a.
Revenue expenditure on research is expensed under respective heads of account in the period in which it is incurred.
b. Development expenditure on new products is capitalised as intangible asset, if all of the following can be demonstrated:
i.
ii.
The technical feasibility of completing the intangible asset so that it will be available for use or sale
The Company has intention to complete the intangible asset and use or sell it
iii. The Company has ability to use or sell the intangible asset
iv.
v.
The manner in which the probable future economic benefits will be generated including the existence of a market for
output of the intangible asset or intangible asset itself or if it is to be used internally, the usefulness of intangible assets
The availability of adequate technical, financial and other resources to complete the development and to use or sell the
intangible asset and
vi. The Company has ability to measure the expenditure attributable to the intangible asset during its development reliably
The development expenditure capitalised as intangible asset is amortised over its useful life.
Other development costs that do not meet above criteria are expensed in the period in which they are incurred.
7. 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.
b.
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.
ii. 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. The present value of the obligation
under such defined benefit plans is determined based on actuarial valuation using the Projected Unit Credit Method.
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 Statement of Profit and Loss.
The interest element in the actuarial valuation of defined benefit plans, which comprises the implicit interest cost and the
impact of changes in discount rate, is classified under finance cost and balance charge is recognised as employee benefit
expenses in the Statement of Profit and Loss.
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 a 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.
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) supra.
d.
Termination benefits:
Termination benefits such as compensation under voluntary retirement cum pension scheme are recognised as expense in the
period in which they are incurred.
281
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
8. Tangible fixed assets
Tangible fixed assets are stated at original cost net of tax/duty credits availed, if any, less accumulated depreciation 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 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 equipment 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.
Tangible assets not ready for the intended use on the date of the Balance Sheet are disclosed as “capital work-in-progress”.
(Also refer to policy on leases, borrowing costs, impairment of assets and foreign currency transactions infra.)
9.
Leases
The determination of whether an agreement is, or contains, a lease is based on the substance of the agreement at the date of
inception.
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 the Statement of Profit and Loss.
b.
Lease transactions entered into on or after April 1, 2001:
Finance leases:
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 given under leases where the Company has transferred substantially all the risks and rewards of ownership to lessee,
are classified as finance leases. Where under a contract, the Company has agreed to manufacture/construct an asset and
convey, in substance, a right to the beneficiary to use the asset over a major part of its economic life, for a pre-determined
consideration, such arrangement is also accounted as finance lease.
iii. Assets given under a finance lease are recognised as a receivable at an amount equal to the net investment in the lease.
Wherever the asset is manufactured/constructed by the Company, the fair value of the asset, representing the net investment
in the lease, is recognised as sales revenue in accordance with the Company’s revenue recognition policy. 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.
Initial direct costs relating to assets given on finance leases are charged to the Statement of Profit and Loss.
Operating leases:
i.
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 Statement of Profit and Loss on accrual basis.
ii. Assets leased out under operating leases are capitalised. Rental income is recognised on accrual basis over the lease term.
(Also refer to policy on depreciation infra.)
10. Depreciation
A.
Indian companies
a. Owned assets
i.
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
the Statement of Profit and Loss.
282
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
ii. 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. 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.
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:
Lease charge comprising statutory depreciation and lease equalisation charge is provided for assets given on lease
over the primary period of the lease equal to recovery of net investment in 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 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.
iii.
Leasehold land:
Land acquired under long term lease is classified under “tangible assets” and is depreciated over the period of lease.
B.
Foreign companies
Depreciation has been provided on methods and at the rates required/permissible by the local laws so as to write off the assets
over their useful life.
11. Intangible assets and amortisation
Intangible assets are stated at original cost net of tax/duty credits availed, if any, less accumulated amortisation and cumulative
impairment. 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.
Specialised software: over a period of three to ten years
Technical know-how: over a period of three to seven years
Trade-marks: over a period of five years
d. Development costs for new products: over a period five years
e. Customer contracts and relationships: over a period of ten years
f.
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 to policy on revenue recognition supra) plus obligation towards negative grants payable to National Highway Authority
of India (NHAI), if any. Till the completion of the project, the same is recognised as intangible assets under development. The
revenue towards collection of toll/other income during the period of construction is reduced from the cost of intangible asset
under development. Toll collection rights are amortised over the period of rights given under the concession agreement.
g.
Exploration and evaluation expenditure incurred for potential mineral reserves is recognised and reported as part of “intangible
assets under development” 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
283
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
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.
h. Utility right to use costs are amortised over the period of ’agreement to use‘, but not exceeding 10 years.
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.
Intangible assets not ready for the intended use on the date of the Balance Sheet are disclosed as “intangible assets under
development”.
Amortisation on impaired assets is provided by adjusting the amortisation charges in the remaining periods so as to allocate the
assets‘ revised carrying amount over its remaining useful life.
12. 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; and
the reversal of impairment loss recognised in previous periods, if any.
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.)
13. Investments
Trade investments comprise investments in entities in which the Company has strategic business interest.
Investments, which are readily realisable and are intended to be held for not more than one year from the date of acquisition, are
classified as current investments. All other investments are classified as long term investments.
Long term investments (other than associates) including trade investments are carried at cost, after providing for any diminution in
value, if such diminution is other than temporary in nature.
Current investments are carried at lower of cost and fair 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 “equity method” [Note R(4)(b)]. Purchase and sale of investments are recognised
based on the trade date accounting.
14. 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. Manufacturing work-in-progress at lower of cost including related overheads or net realisable value. In the case of qualifying
assets, cost also includes applicable borrowing costs vide policy relating to borrowing costs
c.
Finished goods and stock-in-trade (in respect of goods acquired for trading) at lower of weighted average cost or net realisable
value. Cost includes related overheads and excise duty paid/payable on such goods
d. Completed property/work-in-progress (including land) in respect of property development activity at lower of cost or net realisable
value
284
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
15. Cash and bank balances
Cash and bank balances also include fixed deposits, margin money deposits, earmarked balances with banks and other bank balances
which have restrictions on repatriation. Short term and liquid investments being not free from more than insignificant risk of change
in value, are not included as part of cash and cash equivalents.
16. Government grant of capital nature
Grants received/receivable from NHAI in the nature of “promoter contribution” are credited to “capital reserve”.
17. 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
18. Borrowing costs
Borrowing costs include interest, commitment charges, amortisation of ancillary costs, amortisation of discounts/premium related to
borrowings, finance charges in respect of assets acquired on finance lease and exchange differences arising from foreign currency
borrowings, to the extent they are regarded as an adjustment to interest costs.
Borrowing costs that are attributable to the acquisition, construction or production of a qualifying asset are capitalised/inventorised
as part of cost of such asset till such time the asset is ready for its intended use or sale. A qualifying asset is an asset that necessarily
requires a substantial period of time 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.
19. 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.
20. Foreign currency transactions, foreign operations, forward contracts and derivatives
a.
b.
The reporting currency of the Company is 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, 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 of monetary items at each Balance Sheet date
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
285
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
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 and amortisation is accounted at the same
rate at which assets are converted.
ii.
Revenues and expenses at yearly average exchange rates prevailing during the year.
Exchange differences arising on translation of non-integral foreign operations are accumulated in the foreign currency translation
reserve until the disposal of such operations.
f.
Forward contracts, other than those entered into to hedge foreign currency risk on unexecuted firm commitments or highly
probable forecasted 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.
g. All the other derivative contracts, including forward contracts entered into to hedge foreign currency risks on unexecuted firm
commitments and highly probable forecasted transactions, are recognised in the financial statements at fair value as on the
Balance Sheet date, in pursuance of the announcement of the ICAI dated March 29, 2008 on accounting of derivatives. In
addition, the derivative arrangements embedded in the contracts entered in the course of business are accounted separately if
the economic characteristics and risks of the embedded derivatives are not closely related to economic characteristics and risks
of the host contract. [Note Q(24)(a)]
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 (including embedded derivatives)
covered under Accounting Standard (AS) 30 “Financial Instruments: Recognition and Measurement” are recognised in the
Statement of Profit and Loss or Balance Sheet as the case may be after applying the test of hedge effectiveness. Where the hedge
in respect of off-balance sheet items is effective, the gains or losses are recognised in the “hedging reserve” which forms part
of “reserves and surplus” in the Balance Sheet. The amount recognised in the “hedging reserve” is transferred to the Statement
of Profit and Loss in the period in which the underlying hedged item affects the Statement of Profit and Loss. Gains and losses
in respect of ineffective hedges are recognised in the Statement of Profit and Loss in the period in which such gains or losses
are incurred.
h.
The premium paid/received on a foreign currency forward contract is accounted as expense/income over the life of the contract.
21. 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.
iii.
iv.
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”
Income which relates to the Company as a whole and not allocable to segments is included in “unallocable corporate
income”
Segment result includes margins on inter-segment capital jobs, which are reduced in arriving at the profit before tax of the
Company
286
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
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 Company as a whole and not allocable to any segment
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.
22. 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 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.
b.
Foreign companies:
Foreign companies recognise tax liabilities and assets in accordance with the applicable local laws.
23. 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.
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.
24. Commitments
Commitments are future liabilities for contractual expenditure.
Commitments are classified and disclosed as follows:
a.
Estimated amount of contracts remaining to be executed on capital account and not provided for
b. Uncalled liability on shares and other investments partly paid
c.
Funding related commitments to associate and joint venture companies and
d. Other non-cancellable commitments, if any, to the extent they are considered material and relevant in the opinion of management.
Other commitments related to sales/procurements made in the normal course of business are not disclosed to avoid excessive details.
287
Notes forming part of the Consolidated Accounts (contd.)
NOTE [R] SIGNIFICANT ACCOUNTING POLICIES (contd.)
25. Operating cycle for current and non-current classification
Operating cycle for the business activities of the Company covers the duration of the specific project/contract/product line/service
including the defect liability period, wherever applicable and extends up to the realisation of receivables (including retention monies)
within the agreed credit period normally applicable to the respective lines of business.
26. Deferred payment liabilities
The obligation towards additional concession fee payable to NHAI is recognised as deferred payment liability when the Company, in
its capacity of Concessionaire, becomes entitled to exercise the right and collect toll in accordance with the terms of the concession
agreement on Commercial Operations Date.
27. Cash flow statement
Cash flow statement is prepared segregating the cash flows from operating, investing and financing activities. Cash flow from
operating activities is reported using indirect method. Under the indirect method, the net profit is adjusted for the effects of:
a.
transactions of a non-cash nature
b.
any deferrals or accruals of past or future operating cash receipts or payments and
c.
items of income or expense associated with investing or financing cash flows
Cash and cash equivalents (including bank balances) are reflected as such in the Cash Flow Statement. Those cash and cash equivalents
which are not available for general use as on the date of Balance Sheet are also included under this category with a specific disclosure.
As per our report attached
SHARP & TANNAN
Chartered Accountants
Firm’s Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No.33013
Mumbai, May 22, 2013
A. M. NAIK
Group Executive Chairman
K. VENKATARAMANAN
Chief Executive Officer &
Managing Director
R. SHANKAR RAMAN
Chief Financial Officer &
Whole-time Director
S. RAJGOPAL
M. M. CHITALE
N. MOHAN RAJ
A. K. JAIN
M. DAMODARAN
SUSHOBHAN SARKER
N. HARIHARAN
Company Secretary
Directors
Mumbai, May 22, 2013
288
Information on Subsidiary Companies
(for the financial year ended or as on, as the case may be)
L&T
Investment
Management
Limited
L&T Mutual
Fund Trustee
Limited
L&T General
Insurance
Company
Limited
L&T Finance
Limited
L&T Finance
Holdings
Limited
L&T FinCorp
Limited
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
L&T
Infrastructure
Finance
Company
Limited
31-03-2013
crore
L&T Aviation
Services
Private
Limited
31-03-2013
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
1 Share capital (including share application
235.86
0.05
415.00
238.42
2466.76
199.44
829.23
45.60
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
412.34
38.59
686.79
686.79
25.64
33.06
(58.49)
–
(58.49)
–
–
–
–
(0.08)
0.16
0.13
0.13
0.02
0.05
(0.05)
0.01
(0.06)
–
–
–
–
Particulars
Sr.
no.
GDA
Technologies
Limited
GDA
Technologies
Inc.
(266.35)
271.65
420.30
420.30
250.46
119.62
(93.28)
–
(93.28)
–
–
–
–
Larsen
& Toubro
Infotech
Limited
1870.47
12808.50
14917.39
14917.39
76.13
2060.54
313.41
102.38
211.03
–
–
110.39
–
Larsen
& Toubro
Infotech
GmbH
Financial year ending on
Currency
31-03-2013
31-03-2013
USD
31-03-2013
31-03-2013
Euro
Exchange rate on the last day of
financial year
54.29
69.50
1813.79
1230.02
5510.57
5510.57
752.92
171.98
367.46
56.14
311.32
–
–
171.68
1.50
230.48
1871.84
2301.76
2301.76
–
171.26
26.85
(4.76)
31.61
–
–
–
–
1473.56
12945.54
15248.33
15248.33
749.49
1591.50
469.94
125.73
344.21
19.90
–
–
–
(3.87)
78.89
120.62
120.62
–
29.42
3.93
0.46
3.47
–
–
–
–
Larsen
& Toubro
Infotech
Canada
Limited
31-03-2013
Canadian
Dollar
53.44
Larsen
& Toubro
Infotech LLC
31-03-2013
USD
54.29
L&T Infotech
Financial
Services
Technologies
Inc.
31-03-2013
Canadian
Dollar
53.44
L&T Capital
Company
Limited
31-03-2013
1 Share capital (including share application
0.17
5.15
16.13
0.11
0.00
–
280.00
22.00
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
30.87
0.30
31.34
31.34
26.85
0.22
2.12
0.05
2.07
2.69
–
–
–
(31.02)
47.01
21.14
21.14
0.09
7.84
(3.74)
(0.20)
(3.54)
–
–
–
–
1218.46
956.86
2191.45
2191.45
21.73
3613.42
739.29
177.72
561.57
303.15
–
–
–
13.86
3.45
17.42
17.42
–
73.06
2.56
0.64
1.92
–
–
–
–
5.64
8.98
14.62
14.62
–
46.86
0.82
0.16
0.66
–
–
–
–
7.00
0.38
7.38
7.38
–
27.01
1.64
–
1.64
–
–
–
–
96.04
84.07
460.11
460.11
–
242.13
20.57
8.48
12.09
–
–
–
–
6.60
1.08
29.68
29.68
3.20
10.29
3.42
0.79
2.63
17.60
–
–
–
289
Information on Subsidiary Companies
(for the financial year ended or as on, as the case may be)
Particulars
Sr.
no.
L&T Trustee
Company
Private
Limited
L&T Asset
Management
Company
Limited
Financial year ending on
Currency
Exchange rate on the last day of
financial year
31-03-2013
31-12-2012
USD
55.00
1 Share capital (including share application
0.01
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
–
–
0.01
0.01
–
–
–
–
–
–
–
–
–
L&T Chennai
Projects
Private
Limited
(formerly
known as
L&T Arun
Excello IT
SEZ Private
Limited)
31-03-2013
L&T
Diversified
India
Equity Fund
(formerly
known as
L&T Real
Estate India
Fund)
31-12-2012
USD
55.00
0.19
(0.40)
0.26
0.05
0.05
–
–
(0.09)
–
(0.09)
–
–
–
–
L&T Infocity
Limited
L&T Hitech
City Limited
L&T South
City Projects
Limited
Hyderabad
International
Trade
Expositions
Limited
crore
L&T Siruseri
Property
Developers
Limited
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
17.01
2.92
32.97
52.90
52.90
–
23.13
9.41
2.38
7.03
4.25
–
–
–
27.00
75.00
56.48
81.92
173.17
282.09
282.09
2.84
46.65
12.56
2.87
9.69
151.20
–
–
–
(17.05)
5.54
63.49
63.49
–
0.81
(1.34)
1.04
(2.38)
–
–
–
–
101.31
50.48
208.27
208.27
–
33.16
3.86
1.58
2.28
16.94
–
–
–
0.05
(0.05)
0.00
0.00
0.00
–
–
(0.04)
–
(0.04)
–
–
–
–
0.15
(0.27)
0.15
0.03
0.03
–
–
(0.08)
–
(0.08)
–
–
–
–
L&T
Bangalore
Airport Hotel
Limited
CSJ
Infrastructure
Private
Limited
L&T Urban
Infrastructure
Limited
L&T Vision
Ventures
Limited
L&T Tech
Park Limited
L&T Chennai
– Tada
Tollway
Limited
L&T
Samakhiali
Gandhidham
Tollway
Limited
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
1 Share capital (including share application
18.37
72.00
45.89
574.42
0.05
31.63
42.00
80.54
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
290
(12.68)
218.94
224.63
224.63
–
0.66
(39.12)
2.16
(41.28)
–
–
–
–
(44.98)
364.66
391.68
391.68
–
–
(44.59)
–
(44.59)
–
–
–
–
133.28
1248.80
1427.97
1427.97
–
124.76
31.31
19.83
11.48
–
–
–
–
(40.39)
64.42
598.45
598.45
–
14.21
(142.22)
(1.04)
(141.18)
–
–
–
–
(4.59)
10.78
6.24
6.24
–
–
(2.27)
–
(2.27)
–
–
–
–
10.15
70.88
112.66
112.66
–
16.11
2.79
1.44
1.35
–
–
–
–
(0.19)
234.88
276.69
276.69
–
–
–
–
–
–
–
–
–
(0.04)
2933.53
3014.03
3014.03
–
–
–
–
–
–
–
–
–
Information on Subsidiary Companies
(for the financial year ended or as on, as the case may be)
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
L&T Transco
Private
Limited
31-03-2013
L&T
Infrastructure
Development
Projects
Limited
31-03-2013
L&T Panipat
Elevated
Corridor
Limited
31-03-2013
Narmada
Infrastructure
Construction
Enterprise
Limited
31-03-2013
L&T
Krishnagiri
Thopur Toll
Road Limited
L&T Western
Andhra
Tollways
Limited
31-03-2013
31-03-2013
L&T
Vadodara
Bharuch
Tollway
Limited
31-03-2013
crore
L&T
Interstate
Road
Corridor
Limited
31-03-2013
1 Share capital (including share application
0.01
321.05
84.30
47.35
78.75
56.50
43.50
57.16
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
(17.75)
38.53
20.79
20.79
–
–
(0.21)
–
(0.21)
–
–
–
–
2703.01
565.49
3589.55
3589.55
362.92
61.81
24.10
4.40
19.70
–
–
–
–
L&T Western
India
Tollbridge
Limited
L&T
Transportation
Infrastructure
Limited
31-03-2013
31-03-2013
(201.59)
696.48
579.19
579.19
–
45.28
(37.19)
–
(37.19)
–
–
–
–
L&T
Infrastructure
Development
Projects Lanka
(Private)
Limited
31-03-2013
Sri Lankan
Rupee
0.43
142.98
1.07
191.40
191.40
4.00
35.41
37.97
7.63
30.33
–
–
–
–
(75.65)
704.01
707.11
707.11
–
101.55
(3.75)
–
(3.75)
–
–
–
–
(22.73)
277.97
311.74
311.74
–
48.07
(11.20)
–
(11.20)
–
–
–
–
(251.69)
1277.95
1069.76
1069.76
6.00
226.76
(40.46)
0.01
(40.47)
–
–
–
–
31.15
441.99
530.30
530.30
3.00
86.42
10.89
2.18
8.71
–
–
–
–
International
Seaports
(India) Private
Limited
L&T
Krishnagiri
Walajahpet
Tollway
Limited
L&T Devihalli
Hassan
Tollway
Limited
L&T
Metro Rail
(Hyderabad)
Limited
L&T Halol
- Shamlaji
Tollway
Limited
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
1 Share capital (including share application
13.95
41.40
65.43
2.50
90.00
90.00
530.00
130.50
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
14.92
0.01
28.88
28.88
–
–
(0.02)
–
(0.02)
–
–
–
–
59.15
134.78
235.33
235.33
25.00
24.79
16.39
3.32
13.07
–
–
–
–
(3.04)
26.17
88.56
88.56
–
–
–
–
–
–
–
–
–
(3.93)
1.45
0.02
0.02
–
–
(0.01)
–
(0.01)
–
–
–
–
2.92
520.53
613.45
613.45
–
–
1.12
0.36
0.76
–
–
–
–
161.84
201.59
453.43
453.43
10.00
–
2.32
0.76
1.56
–
–
–
–
0.26
1356.09
1886.35
1886.35
7.01
–
1.32
0.03
1.29
–
–
–
–
(125.80)
1289.70
1294.40
1294.40
–
83.75
(125.13)
–
(125.13)
–
–
–
–
291
Information on Subsidiary Companies
(for the financial year ended or as on, as the case may be)
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
L&T
Ahmedabad
- Maliya
Tollway
Limited
31-03-2013
L&T Port
Kachchigarh
Limited
L&T
Uttaranchal
Hydropower
Limited
Nabha
Power
Limited
L&T Power
Development
Limited
L&T
Arunachal
Hydropower
Limited
L&T
Himachal
Hydropower
Limited
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
crore
Larsen
& Toubro
(Oman) LLC
31-12-2012
Omani Rial
142.85
1 Share capital (including share application
149.00
4.16
131.05
1373.00
1799.00
32.14
150.00
17.96
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
Particulars
Sr.
no.
(85.08)
1413.07
1476.99
1476.99
–
77.78
(84.28)
–
(84.28)
–
–
–
–
(4.50)
0.35
0.01
0.01
–
–
(0.31)
–
(0.31)
–
–
–
–
3.24
364.92
499.21
499.21
12.29
–
1.44
0.01
1.43
–
–
–
–
Larsen &
Toubro (East
Asia) SDN.
BHD
Larsen
& Toubro
International
FZE
Larsen &
Toubro Qatar
LLC
(92.27)
5559.61
6840.34
6840.34
40.24
3261.69
(97.08)
–
(97.08)
–
–
–
–
L&T
Overseas
Projects
Nigeria
Limited
1.73
3.38
1804.11
1804.11
21.05
21.72
2.37
0.92
1.45
–
–
–
–
Larsen
& Toubro
Electromech
LLC
Financial year ending on
Currency
Exchange rate on the last day of
financial year
31-12-2012
Malaysian
Ringgit
17.99
31-12-2012
USD
31-12-2012
Qatari Rial
55.00
15.10
31-12-2012
Nigerian
Naira
0.35
31-12-2012
Omani Rial
142.85
0.16
2.73
35.03
35.03
0.23
–
0.06
0.00
0.06
–
–
–
–
(0.10)
15.90
165.80
165.80
0.33
–
0.06
0.00
0.06
–
–
–
–
L&T
Electrical &
Automation
FZE
L&T Electrical
And
Automation
Saudi Arabia
Company
Limited LLC
(formerly
known as L&T
Electricals
Saudi Arabia
Company
Limited, LLC)
31-12-2012 31-12-2012
UAE
Saudi Riyal
Dirham
14.98
14.67
1 Share capital (including share application
0.86
1147.40
0.24
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
0.44
2.12
3.42
3.42
–
1.85
0.05
0.01
0.04
–
–
–
–
(36.06)
33.67
1145.01
1145.01
15.94
5.80
24.10
0.62
23.48
–
–
–
–
(35.70)
40.16
4.70
4.70
0.13
–
–
–
–
–
–
–
–
0.33
(0.27)
0.04
0.10
0.10
–
–
(0.03)
–
(0.03)
–
–
–
–
3.56
22.29
1.09
160.47
206.64
370.67
370.67
–
594.67
34.78
4.19
30.59
–
–
–
–
(2.12)
63.83
84.00
84.00
–
74.00
(6.99)
–
(6.99)
–
–
–
–
101.58
117.27
219.94
219.94
–
252.43
34.13
–
34.13
–
–
–
–
292
512.93
1356.97
1887.86
1887.86
–
1995.24
17.23
2.39
14.84
6.34
–
–
–
Larsen
& Toubro
Kuwait
Construction
General
Contracting
Company,
WLL
31-12-2012
Kuwaiti
Dinar
198.36
32.02
6.74
53.42
92.18
92.18
–
87.11
6.62
–
6.62
–
–
–
–
Information on Subsidiary Companies
(for the financial year ended or as on, as the case may be)
Larsen
& Toubro
Readymix
Concrete
Industries
LLC
31-12-2012
UAE Dirham
L&T Modular
Fabrication
Yard LLC
Larsen &
Toubro Saudi
Arabia LLC
Larsen &
Toubro ATCO
Saudia LLC
Larsen &
Toubro Heavy
Engineering
LLC
crore
Tamco
Switchgear
(Malaysia)
SDN.BHD
31-12-2012
Omani Rial
31-12-2012
Saudi Riyal
31-12-2012
Saudi Riyal
31-12-2012
Omani Rial
31-12-2012
Malaysian
Ringgit
14.98
142.85
14.67
14.67
142.85
17.99
1.27
32.75
4.64
1.08
68.49
119.18
5.04
102.43
108.74
108.74
–
64.31
(5.17)
–
(5.17)
–
–
–
–
70.69
210.52
313.96
313.96
–
476.42
17.61
0.49
17.12
–
–
–
–
(64.66)
550.12
490.10
490.10
–
647.90
(16.35)
2.86
(19.21)
–
–
–
–
(3.15)
150.38
148.31
148.31
–
115.88
3.39
0.42
2.97
–
–
–
–
(110.95)
323.56
281.10
281.10
–
150.99
(26.70)
–
(26.70)
–
–
–
–
279.72
248.15
647.05
647.05
–
575.36
74.08
5.89
68.19
–
–
22.50
–
0.54
0.96
0.03
1.53
1.53
–
1.28
0.56
0.02
0.54
–
–
–
–
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
Larsen
& Toubro
(Qingdao)
Rubber
Machinery
Company
Limited
31-12-2012
Chinese
Yuan
Renminbi
8.73
Qingdao
Larsen &
Toubro
Trading
Company
Limited
31-12-2012
Chinese
Yuan
Renminbi
8.73
1 Share capital (including share application
41.10
(9.15)
92.49
124.44
124.44
–
40.24
(24.57)
–
(24.57)
–
–
–
–
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
Tamco
Electrical
Industries
Australia Pty
Ltd.
31-12-2012
Australian
Dollar
57.07
PT Tamco
Indonesia
Peacock
Investments
Limited
Lotus
infrastructure
Investments
Limited
Mango
Investments
Limited
Larsen
& Toubro
Consultoria E
Projeto LTDA
Larsen &
Toubro T&D
SA (PTY) LTD
31-12-2012
Indonesian
Rupiah
0.01
31-12-2012
USD
31-12-2012
USD
31-12-2012
USD
55.00
55.00
55.00
31-12-2012
Brazilian
Real
26.86
31-03-2013
South
African Rand
5.87
L&T Realty
Limited
31-03-2013
1 Share capital (including share application
45.20
14.71
0.16
0.16
0.16
2.69
0.00
200.00
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
(13.54)
54.18
85.84
85.84
–
117.59
9.95
–
9.95
–
–
–
–
(7.79)
78.78
85.70
85.70
–
45.34
1.68
–
1.68
–
–
–
–
(0.24)
0.10
0.02
0.02
–
–
(0.06)
–
(0.06)
–
–
–
–
(0.24)
0.10
0.02
0.02
–
–
(0.06)
–
(0.06)
–
–
–
–
(0.24)
0.10
0.02
0.02
–
–
(0.06)
–
(0.06)
–
–
–
–
(1.90)
0.12
0.91
0.91
–
–
(1.61)
–
(1.61)
–
–
–
–
2.75
0.32
3.07
3.07
–
–
(0.26)
–
(0.26)
–
–
–
–
(1.96)
1311.41
1509.45
1509.45
0.31
–
0.92
0.20
0.72
–
–
–
–
293
Information on Subsidiary Companies
(for the financial year ended or as on, as the case may be)
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
Chennai
Vision
Developers
Private
Limited
31-03-2013
L&T Realty
FZE
L&T Power
Limited
L&T-Valdel
Engineering
Limited
L&T Natural
Resources
Limited
31-03-2013
31-03-2013
31-03-2013
31-12-2012
UAE Dirham
14.98
Hi-Tech
Rock
Products &
Aggregates
Limited
31-03-2013
Tractor
Engineers
Limited
31-03-2013
crore
Bhilai
Power
Supply
Company
Limited
31-03-2013
1 Share capital (including share application
0.01
9.66
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
(0.02)
0.01
0.00
0.00
–
–
–
–
–
–
–
–
–
(2.01)
0.02
7.67
7.67
–
–
(0.10)
–
(0.10)
–
–
–
–
0.05
3.94
0.05
4.04
4.04
3.98
–
3.84
0.00
3.84
13.43
–
–
–
1.18
0.05
0.05
6.80
0.05
48.44
15.85
65.47
65.47
0.83
83.99
8.62
2.40
6.22
–
–
–
–
(6.31)
6.38
0.12
0.12
–
–
(0.02)
–
(0.02)
–
–
–
–
1.32
15.55
16.92
16.92
–
111.51
0.99
0.31
0.68
–
–
–
–
15.83
22.20
44.83
44.83
2.16
8.57
(17.31)
–
(17.31)
–
–
–
–
–
8.81
8.86
8.86
–
–
–
–
–
–
–
–
–
L&T-Sargent
& Lundy
Limited
Spectrum
Infotech
Private
Limited
31-03-2013
31-03-2013
Larsen &
Toubro LLC
L&T
Shipbuilding
Limited
L&T-Gulf
Private
Limited
31-03-2013
31-03-2013
31-12-2012
USD
55.00
Raykal
Aluminium
Company
Private
Limited
31-03-2013
L&T
Electricals
and
Automation
Limited
31-03-2013
L&T
Seawoods
Private
Limited
31-03-2013
1 Share capital (including share application
5.57
0.44
0.24
1265.86
8.00
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
294
49.96
21.63
77.16
77.16
46.07
102.27
10.17
2.64
7.53
–
–
–
–
13.07
20.39
33.90
33.90
–
24.46
3.45
0.82
2.63
–
–
–
–
1.25
2.78
4.27
4.27
–
5.71
0.20
0.02
0.18
–
–
–
–
(202.12)
3167.69
4231.43
4231.43
82.38
104.82
(196.54)
–
(196.54)
–
–
–
–
5.50
3.16
16.66
16.66
0.02
19.81
6.66
2.19
4.47
–
–
–
–
0.05
0.43
0.45
0.93
0.93
–
–
1.29
0.26
1.03
–
–
–
–
0.05
1144.00
(0.01)
0.01
0.05
0.05
–
–
(0.00)
–
(0.00)
–
–
–
–
(4.25)
1523.67
2663.42
2663.42
75.34
–
0.62
–
0.62
–
–
–
–
Information on Subsidiary Companies
(for the financial year ended or as on, as the case may be)
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
L&T Rajkot
- Vadinar
Tollway
Limited
Kesun Iron
& Steel
Company
Private
Limited
L&T
Technologies
Limited
31-03-2013
31-03-2013
31-03-2013
L&T Special
Steels and
Heavy
Forgings
Private
Limited
31-03-2013
crore
L&T
Howden
Private
Limited
L&T Solar
Limited
L&T Sapura
Shipping
Private
Limited
L&T Sapura
Offshore
Private
Limited
31-03-2013
31-03-2013
31-03-2013
31-03-2013
1 Share capital (including share application
110.00
0.01
0.05
540.00
30.00
0.05
158.85
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
(129.42)
1013.25
993.83
993.83
–
59.26
(113.46)
–
(113.46)
–
–
–
–
(0.25)
0.25
0.01
0.01
–
–
(0.00)
–
(0.00)
–
–
–
–
(0.01)
0.01
0.05
0.05
–
–
(0.00)
–
(0.00)
–
–
–
–
L&T
PowerGen
Limited
Ewac Alloys
Limited
L&T
Kobelco
Machinery
Private
Limited
(175.85)
1371.62
1735.77
1735.77
12.73
14.07
(155.74)
–
(155.74)
–
–
–
–
L&T-MHI
Boilers
Private
Limited
(10.68)
132.27
151.59
151.59
–
156.12
2.95
2.29
0.66
–
–
–
–
L&T-MHI
Turbine
Generators
Private
Limited
(0.01)
0.01
0.05
0.05
–
–
(0.00)
–
(0.00)
–
–
–
–
(17.57)
588.82
730.10
730.10
–
232.42
29.98
0.51
29.47
–
–
–
–
PNG
Tollway
Limited
L&T
Cassidian
Limited
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
0.01
0.41
16.38
16.80
16.80
–
0.26
4.08
2.37
1.71
–
–
–
–
L&T Infra
Investment
Partners
Advisory
Private
Limited
31-03-2013
1 Share capital (including share application
0.05
8.29
50.00
234.10
340.60
169.10
0.05
5.00
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
(0.01)
0.01
0.05
0.05
–
–
(0.00)
–
(0.00)
–
–
–
–
67.00
115.07
190.36
190.36
–
384.53
86.52
28.45
58.07
34.42
–
–
–
(14.73)
49.04
84.31
84.31
2.67
13.83
(13.76)
–
(13.76)
–
–
–
–
47.60
2956.31
3238.01
3238.01
450.18
2359.76
163.41
21.98
141.43
–
–
–
–
(221.88)
2839.14
2957.86
2957.86
–
992.34
(89.46)
0.01
(89.47)
–
–
–
–
(38.46)
1402.26
1532.90
1532.90
–
17.75
(37.58)
–
(37.58)
–
–
–
–
(0.01)
0.00
0.04
0.04
–
–
(0.00)
–
(0.00)
–
–
–
–
(9.92)
16.39
11.47
11.47
0.53
–
(5.31)
–
(5.31)
–
–
–
–
295
Information on Subsidiary Companies
(for the financial year ended or as on, as the case may be)
Particulars
Sr.
no.
Financial year ending on
Currency
Exchange rate on the last day of
financial year
1 Share capital (including share application
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
Particulars
Sr.
no.
L&T Unnati
Finance
Limited
L&T Infra
Investment
Partners
Trustee
Private
Limited
31-03-2013
31-03-2013
L&T Access
Financial
Advisory
Services
Limited
(formerly
L&T Access
Financial
Advisory
Services
Private
Limited)
31-03-2013
L&T BPP
Tollway
Limited
L&T Deccan
Tollways
Limited
Audco India
Limited
CSJ Hotels
Private
Limited
crore
L&T
Housing
Finance
Limited
31-03-2013
31-03-2013
31-03-2013
31-03-2013
31-03-2013
0.10
(0.05)
0.02
0.07
0.07
–
–
(0.04)
–
(0.04)
–
–
–
–
4.50
6.00
196.94
(0.28)
497.04
501.26
501.26
233.55
–
(0.32)
(0.07)
(0.25)
–
–
–
–
(9.54)
10.25
6.71
6.71
–
3.47
(13.75)
(4.23)
(9.52)
–
–
–
–
(1.62)
701.00
896.32
896.32
–
–
(0.19)
0.02
(0.21)
–
–
–
–
23.68
(1.01)
0.69
23.36
23.36
–
–
(0.97)
–
(0.97)
–
–
–
–
Consumer
Financial
Services
Limited
Family Credit
Limited
L&T Capital
Markets
Limited
L&T Trustee
Services
Private
Limited
(formerly
known as
FIL Trustee
Company
Private
Limited)
31-03-2013
L&T Fund
Management
Private
Limited
(formerly
known as
FIL Fund
Management
Private
Limited )
31-03-2013
15.63
0.01
43.92
219.87
267.73
503.23
503.23
–
650.72
60.90
21.10
39.80
100.05
–
–
–
(0.00)
0.00
0.01
0.01
–
–
(0.00)
–
(0.00)
–
–
–
–
99.40
224.75
368.07
368.07
0.61
28.66
22.25
(2.14)
24.39
–
–
–
–
L&T Infra
Debt Fund
Limited
L&T East-
West Tollway
Limited
L&T Great
Eastern
Highway
Limited
31-03-2013
31-03-2013
31-03-2013
Financial year ending on
Currency
Exchange rate on the last day of
financial year
31-03-2013
31-03-2013
31-03-2013
1 Share capital (including share application
1.00
154.31
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
(0.63)
0.00
0.37
0.37
–
–
0.01
–
0.01
–
–
–
–
142.28
1518.08
1814.67
1814.67
–
328.05
71.03
(15.93)
86.96
–
–
–
–
2.55
(1.59)
1.28
2.24
2.24
–
–
(1.59)
–
(1.59)
–
–
–
–
0.01
1.58
0.03
1.62
1.62
–
–
0.23
0.07
0.16
–
–
–
–
323.00
(292.96)
1.46
31.50
31.50
2.27
–
0.35
–
0.35
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
15.15
(0.44)
1.34
16.05
16.05
–
–
(0.44)
–
(0.44)
–
–
–
–
12.28
(0.29)
1.04
13.03
13.03
–
–
(0.29)
–
(0.29)
–
–
–
–
296
Information on Subsidiary Companies
(for the financial year ended or as on, as the case may be)
Particulars
Sr.
no.
L&T
Technology
Services Limited
L&T Tejomaya
Limited
Larsen &
Toubro Infotech
South Africa
(PTY) Limited
Thalest Limited
Bond
Instrumentation
& Process
Control Limited
Servowatch
Systems
Limited
Larsen Toubro
Arabia LLC
crore
Henikwon
Corporation
SDN.BHD
Financial year ending on
31-03-2013
31-03-2013
31-03-2013
31-12-2012
31-12-2012
31-12-2012
31-12-2012
31-12-2012
Currency
Exchange rate on the last day of
financial year
1 Share capital (including share application
0.05
0.05
money pending allotment)
2 Reserves
3 Liabilities
4 Total liabilities
5 Total assets
6 Investments (details on pages 298 to 308)
7 Turnover
8 Profit before taxation
9 Provision for taxation
10 Profit after taxation
11 Interim dividend - equity
12 Interim dividend - Preference
13 Proposed dividend - equity
14 Proposed dividend - preference
–
0.00
0.05
0.05
–
–
–
–
–
–
–
–
–
(0.01)
0.01
0.05
0.05
–
–
(0.01)
–
(0.01)
–
–
–
–
South
African Rand
5.87
0.27
0.22
16.96
17.45
17.45
–
26.37
0.31
0.09
0.22
–
–
–
–
British
Pound
88.92
British
Pound
88.92
British
Pound
88.92
Saudi Riyal
Malaysian
Ringgit
14.67
17.99
1.10
0.00
0.41
14.78
10.80
6.46
11.12
18.68
18.68
–
–
2.91
–
2.91
–
–
–
–
–
–
0.00
0.00
–
–
–
–
–
–
–
–
–
(4.61)
23.50
19.30
19.30
–
14.56
(6.74)
(0.16)
(6.58)
–
–
–
–
(0.39)
0.28
14.67
14.67
–
–
(0.27)
–
(0.27)
–
–
–
–
(20.67)
28.74
18.87
18.87
–
31.91
(12.75)
0.34
(13.09)
–
–
–
–
297
Annexure to Information regarding Subsidiary Companies
Details of Investments as at 31-03-2013/31-12-2012
Name of the Company
No. of Shares/
Units/Bonds
Face Value
( )
Book Value
( crore)
Quoted/
Unquoted
L&T Finance Limited
Long term investment:
Government securities:
12% National saving certificates 2002 ( 4,000)
–
–
–
Unquoted
Security receipts:
Phoenix ARC Private Limited :
Phoenix ARF Scheme 5
Phoenix ARF Scheme 6
Phoenix ARF Scheme 7
Phoenix ARF Scheme 8
Phoenix ARF Scheme 9
Phoenix ARF Scheme 10
Share application money paid pending allotment
Other company:
Fully paid equity shares:
Invent Assets Securitisation & Reconstruction
Private Limited
Alpha Micro Finance Consultants Private Limited
Metropoli Overseas Limited
Anil Chemicals and Industries Limited
Elque Polyesters Limited
Monnet Industries Limited
Monnet Ispat And Energy Limited
Monnet Sugar Limited
Intergrated Digital Info Services Limited
SUB -TOTAL
Long term investment:
Infrastructure Development Finance Limited
8,501
9,843
23,238
38,195
6,612
18,889
71,00,000
2,00,000
99,400
40,000
1,94,300
5,640
3,008
11,280
3,83,334
905
1000
985
545
1000
1000
10
10
10
10
10
10
10
10
10
0.77
Unquoted
0.98
Unquoted
2.29
Unquoted
2.08
Unquoted
0.66
Unquoted
1.89
Unquoted
4.37
Unquoted
15.98
Unquoted
0.20
Unquoted
0.15
Unquoted
0.08
Unquoted
0.19
Quoted
0.02
Quoted
0.01
Quoted
0.05
Quoted
0.12
Quoted
29.84
IDFC Ltd. (M+150bps) 16 May 2017
400
1000000
46.84
Quoted
SUB -TOTAL
Less: Provision for diminution in value
TOTAL
46.84
0.55
76.13
298
Annexure to Information regarding Subsidiary Companies
Details of Investments as at 31-03-2013/31-12-2012
Name of the Company
No. of Shares/
Units/Bonds
Face Value
( )
Book Value
( crore)
Quoted/
Unquoted
Larsen & Toubro Infotech Limited
Current investments:
Mutual funds:
Liquid investments:
L&T Ultra Short Fund -IP-DDR
L&T Liquid Super IP DDR
Fixed Maturity Plans:
58,07,773
37,889
10
1000
5.90
Quoted
3.83
Quoted
HDFC FMP 372D Februarry 2013 (1) - Growth
20,00,000
ICICI Prudential FMP Series 66 - 366 Days Plan F- Growth
20,00,000
Kotak FMP series 94- 370D - Growth
L&T FMP VII (March 367D A) - Growth
Religare FMP Series XVII- Plan B- Growth
IDFC FMP 36 Months Series 2 Dividend Payout
20,00,000
20,00,000
20,00,000
20,00,000
10
10
10
10
10
10
2.00
Quoted
2.00
Quoted
2.00
Quoted
2.00
Quoted
2.00
Quoted
2.00
Quoted
21.73
TOTAL
Larsen & Toubro International FZE (as at 31-12-2012)
Long term investment:
Associate company:
Fully paid equity shares:
L&T-Camp Facilities LLC
Jointly controlled entity:
Fully paid equity shares:
2,450
AED 1000
3.67
Unquoted
IndIran Engg & Project Services Krish LLC
875
Irani Riyal
1000000 each
0.48
Unquoted
Others
Fully paid equity shares:
Jiangsu Shengye Valve Co., Limited
(formerly known as Larsen & Toubro (Jiangsu) Valve
Company Limited)
TOTAL
11.79
Unquoted
15.94
299
Annexure to Information regarding Subsidiary Companies
Details of Investments as at 31-03-2013/31-12-2012
Name of the Company
No. of Shares/
Units/Bonds
Face Value
( )
Book Value
( crore)
Quoted/
Unquoted
L&T-Sargent & Lundy Limited
Non-Current Investments:
Mutual fund:
L&T FMP-V (Feb 419 Day A)
40,00,000
10
4.00
Unquoted
Current investments:
Mutual fund:
Axis Treasury Advantage Fund- Daily Dividend Reinvestment
40,106
10000
4.01
Unquoted
HDFC Short Term Opportuunty Fund - Div. Reinvestment
L&T STDF Quarterly Dividend
33,03,709
23,91,555
L&T Short Term Opportunity Fund - Monthly Dividend
1,77,17,532
DSP Strategic Bond Fund
DWS FMP Series 24 Direct Plan Growth
L&T Liquid Fund Super IP
L&T Ultra STF-IP
BSL Short Term Fund-Dividend Payment
TOTAL
L&T Infrastructure Development Projects Limited
Long term investment:
Associate companies:
Fully paid equity shares:
37,157
20,00,000
887
27,56,231
43,05,482
10
10
10
10000
10
1000
10
10
3.32
Unquoted
2.50
Unquoted
18.50
Unquoted
3.85
Unquoted
2.00
Unquoted
0.09
Unquoted
2.80
Unquoted
5.00
Unquoted
46.07
International Seaports Haldia (Private) Limited
98,30,000
10
9.83
Unquoted
Jointly controlled entity:
Fully paid equity shares:
The Dhamra Port Company Limited
32,39,99,960
10
324.00
Unquoted
Other companies:
Fully paid equity shares:
SICAL Iron Ore Terminals Limited
Second Vivekananda Bridge Tollway Company
Private Limited
Current investments:
Fully paid equity shares:
1,43,00,000
1,000
10
10
14.30
Unquoted
0.00
Unquoted
Ennore Tank Terminals Private Limited
67,87,500
10
6.79
Unquoted
Mutual Funds
L&T Liquid Fund Growth
TOTAL
300
49,779
1000
8.00
Quoted
362.92
Annexure to Information regarding Subsidiary Companies
Details of Investments as at 31-03-2013/31-12-2012
Name of the Company
No. of Shares/
Units/Bonds
Face Value
( )
Book Value
( crore)
Quoted/
Unquoted
L&T Capital Company Limited
Current investments:
Mutual fund:
Kotak Floater Short Term - Growth
Kotak Bond Scheme Plan A - Direct Plan- Growth
1,605
8,61,621
10
10
0.30
2.90
3.20
Quoted
Quoted
Larsen & Toubro Qatar & HBK Contracting Co WLL -JV
100
QR 100000
Unquoted
0.13
0.13
TOTAL
Larsen & Toubro Infotech GmbH
Long term investment:
Other company:
Fully paid equity shares:
Pan Health, USA
TOTAL
Larsen & Toubro Qatar LLC (as at 31-12-2012)
Long term investment:
Associate company:
Fully paid equity shares:
TOTAL
L&T Infrastructure Finance Company Limited
Long term investment:
Other company:
Fully paid equity shares:
Feedback Infrastructure Services Private Limited
BSCPL Infrastructure Ltd.
Tikona Digital Networks Pvt. Ltd.
Bhoruka Power Corporation Limited
Ardom Telecom Ltd
Compulsory Convertible Debentures:
Tikona Digital Networks Pvt. Ltd
Cumulative Redeemable Preference Shares
Anrak Aluminium Limited
KSK Energy Ventures Limited
Cumulative Convertible Preference Shares
Ardom Telecom Ltd
Venture Capital Units
1,00,000
USD 1
Unquoted
0.00
0.00
37,90,000
10,47,916
316
5,87,850
6,48,649
100
10
10
10
10
37.90
60.05
0.09
50.00
2.00
Unquoted
Unquoted
Unquoted
Unquoted
Unquoted
5,19,212
2840
147.46
Unquoted
12,50,00,000
10,00,00,000
10
10
125.00
100.00
Unquoted
Unquoted
1,800
100000
18.00
Unquoted
LICHFL Urban Development Fund
2,000
10000
2.00
Unquoted
Current Investments:
Equity Shares
C&C Construction Limited
ICOMM Tele Limited
Mutual Funds
8,77,081
41,667
Fidelity Cash Fund (Super Institutional) Daily Dividend
L&T Floating Fund
9,98,116
5,38,69,467
TOTAL
10
10
1000
10
2.72
–
Quoted
Unquoted
102.14
102.13
749.49
Unquoted
Unquoted
301
Annexure to Information regarding Subsidiary Companies
Details of Investments as at 31-03-2013/31-12-2012
Name of the Company
No. of Shares/
Units/Bonds
Face Value
( )
Book Value
( crore)
Quoted/
Unquoted
L&T Power Limited
Current investments:
Mutual fund:
L&T Liquid Fund - Institutional Plan Plus- DDR
39,350
1000
TOTAL
L&T - MHI Boilers Private Limited
Current investments:
Mutual fund:
Short term debt plan:
Unquoted
3.98
3.98
BSL Floating Rate Fund STP Growth- Direct
BSL Short Term Fund _Growth- Direct
HDFC High Int. DP Short Term Growth
ICICI Prudential Liquid - Direct Plan- Growth
Kotak Floater Short Term Growth
Kotak Floater Short Term - Direct Plan -Growth
L&T Liquid Direct Plan - Growth
Reliance Liquidity Fund- Treasury Plan- Direct Growth Plan
Reliance Medium Term Fund - Direct Growth Plan
SBI Short Term Debt Fund - Direct Plan- Growth
Tata Income Fund Direct Plan- Growth
UTI Short Term Income Fund - Institutuional Option
- Direct Plan- Growth
3,70,805
1,15,26,368
2,16,28,636
23,08,136
57,602
2,10,737
2,92,441
21,060
1,76,59,065
3,71,04,983
1,59,56,884
3,57,19,644
TOTAL
L&T-Valdel Engineering Limited
Current investments:
Mutual fund:
100
10
10
100
1000
1000
1000
1000
10
1000
10
10
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
5.75
50.00
50.00
40.00
11.00
40.43
47.00
6.00
43.00
50.00
57.00
50.00
450.18
L&T Short Term Opp Fund Dividend
7,99,477
10
TOTAL
GDA Technologies Inc.
Current Investment:
Other companies:
Fully paid equity shares:
Arkadoc Group, Inc
Citrix System, Inc.
SUB -TOTAL
Less: Provision for diminution in value
TOTAL
L&T Power Development Limited
Long term investment:
Other companies:
Fully paid equity shares:
Konaseema Gas Power Limited
TOTAL
302
1,50,000
114
USD 1
USD 1
Unquoted
0.83
0.83
Quoted
Quoted
0.09
0.03
0.12
0.03
0.09
2,10,00,000
10
21.05
21.05
Unquoted
Annexure to Information regarding Subsidiary Companies
Details of Investments as at 31-03-2013/31-12-2012
Name of the Company
L&T Finance Holdings Limited
Long term investment:
Associate company:
Fully paid equity shares:
No. of Shares/
Units/Bonds
Face Value
( )
Book Value
( crore)
Quoted/
Unquoted
NAC Infrastructure Equipment Limited
45,00,000
10
4.50
Unquoted
Current investments:
Mutual fund:
L&T Ultra STF - Daily Dividend Reinvestment Plan
L&T Liquid Fund - Daily Dividend Reinvestment Plan
L&T Cash Fund - Daily Dividend Plan
L&T Flexi Bond Fund - Dividend Option Plan
10,05,47,830
32,15,170
29,32,282
2,53,02,304
10
1000
1000
10
102.15
Unquoted
325.26
Unquoted
300.06
Unquoted
25.45
Unquoted
SUB -TOTAL
Less: Provision for diminution in value
TOTAL
L&T Investment Management Limited
Current investments:
Mutual fund:
757.42
4.50
752.92
L&T Liquid Fund Direct Plan - Growth
1,60,372
1000
25.64
Unquoted
TOTAL
L&T Mutual Fund Trustee Limited
Current investments:
Mutual fund:
L&T Ultra Short Term Fund - Growth
L&T Ultra Short Term Fund Regular - Cumulative
9,290
2,878
10
10
TOTAL
Nabha Power Limited
Current investments:
Mutual fund:
25.64
0.02
Unquoted
0.00
Unquoted
0.02
L&T Liquid Inst Daily Dividend Reinvestment Plan
HDFC Liquid Plan
HDFC Floating Rate Income Fund-Short Term Plan
- Wholesale option Direct Plan-DDR
Birla Sun Life Cash plus- Instl. Prem
- Daily Dividend Reinvestment
Axis Liquid Fund- Instituional Plan- Daily Dividend
ICICI Prudential Flexible Income Plan Premium - Daily Dividend
ICICI Prudential Liquid Super Institutional Plan - Daily Dividend
TOTAL
3,33,055
29,962
57,93,160
50,664
528
9,686
1,518
1000
33.70
Unquoted
10
10
100
1000
100
100
0.03
Unquoted
5.84
Unquoted
0.51
Unquoted
0.05
Unquoted
0.10
Unquoted
0.01
Unquoted
40.24
303
Annexure to Information regarding Subsidiary Companies
Details of Investments as at 31-03-2013/31-12-2012
Name of the Company
No. of Shares/
Units/Bonds
Face Value
( )
Book Value
( crore)
Quoted/
Unquoted
L&T General Insurance Company Limited
Long term investment:
Government securities:
7.80% Government Stock 03-05-2020
8.15% GOI CG 11-06-2022
8.19% GOI CG 16-01-2020
8.20% Government Stock 15-02-2022
8.26% Government Stock 02-08-2027
8.33% Government Stock 09-07-2026
8.85% MH SDL SG 2022
8.97% Government Stock 05-12-2030
9.15% Government Stock 14.11.2024
Bonds:
10.06% L&T IDPL BS 27-04-2015 C
10.06% L&T IDPL BS 28-04-2015
10.60% Shriram Transport Finance DB 05-06-2018
11.69% Tata Teleservices NCD 14-08-2025
7.70% NHPC BS 31-03-2018
8.79% HDFC Ltd. NCB 21-07-2020
8.80% GAIL BS 13-12-2018
8.80% GAIL BS 13-12-2019
8.84% Powergrid Bonds-21-10-2020
8.90% PGC BS 25-02-2015
8.95% IBS Ltd NCD 15-09-2020
9.00% ICICI Bank DB 04-06-2018
9.30% DAMODAR DB 30-03-2027
9.35% IOC NCB 30-04-2017 XII
9.35% PGC BS 29-08-2016 A
9.35% PGC DB 29-08-2020
9.40% NABARD BS 30-03-2015
9.40% NHB BS 10-01-2015
9.55% HINDALCO DB 24-04-2022
9.55% HINDALCO DB 25-04-2022
9.63% PFC BS 15-12-2015
9.68% HDFC LTD BS 09-02-2015
9.95% SBI BS 16-03-2026
Current investments:
Other Securities (Short Term)
AXIS Bank CD 16-09-2013
8.40% LIC HF NCD 18-08-2013
Mutual Funds:
Franklin Templeton India TMA-Super Institutional Plan
J P Morgan India Liquid-Super Inst. Growth
Kotak Short Term Floater Growth 1000
L&T Liquid Fund Sup Inst Plan Plus Cumulative - Growth
TOTAL
304
15,00,000
5,00,000
5,00,000
20,00,000
5,00,000
5,00,000
10,00,000
10,00,000
10,00,000
5,00,000
2,50,000
10,00,000
3,00,000
1,00,000
4,00,000
5,00,000
5,00,000
5,00,000
50,000
1,30,000
15,00,000
10,00,000
15,00,000
3,00,000
2,00,000
5,00,000
5,00,000
5,00,000
5,00,000
5,00,000
5,00,000
5,00,000
20,00,000
5,00,000
24,792
29,90,424
38,901
1,412
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
10
10
1000
1000
15.58
5.00
5.01
20.74
4.95
5.03
10.01
10.79
10.85
4.98
2.49
10.00
3.06
0.94
3.97
4.92
4.91
5.00
0.50
1.25
15.00
10.30
15.08
3.00
2.02
5.01
5.00
5.00
5.07
5.06
5.00
5.19
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
Quoted
18.51
4.97
Quoted
Quoted
4.26
4.44
7.35
0.22
250.46
Quoted
Quoted
Quoted
Quoted
Annexure to Information regarding Subsidiary Companies
Details of Investments as at 31-03-2013/31-12-2012
Name of the Company
No. of Shares/
Units/Bonds
Face Value
( )
Book Value
( crore)
Quoted/
Unquoted
L&T Infocity Limited
Long term investment:
Associate company:
Fully paid equity shares:
Vizag IT Park Limited
Current Investments:
Government securities:
23,40,000
10
2.34
Unquoted
NHAI- Non-convertible Redeemable - Taxable Bonds
500
10000
0.50
Unquoted
TOTAL
GDA Technologies Limited
Current investments:
Mutual Funds:
Birla Sunlife Asset Management Co Ltd.
Franklin Templeton FRIF-Super IP-DDRDO
L&T Ultra Short Term Fund IP DDR
TOTAL
L&T Uttaranchal Hydropower Limited
Current investments:
Mutual Funds
2.84
6,49,521
1,27,82,716
74,22,791
100
10
10
6.50
Quoted
12.81
Quoted
7.54
Quoted
26.85
L&T Ultra STF Direct Plan-DDR
1,20,99,923
10
TOTAL
L&T Arunachal Hydropower Limited
Current investments:
Mutual Funds
L&T Freedom Income Fund ST/IP/DDR
2,30,040
10
TOTAL
L&T Himachal Hydropower Limited
Current investments:
Mutual Funds
L&T Freedom Income Fund ST/IP/DDR
3,19,981
10
TOTAL
L&T Transportation Infrastructure Limited
Current investments:
Mutual Funds
L&T Liquid Growth Fund
1,55,560
1000
TOTAL
12.29
12.29
Quoted
Quoted
0.23
0.23
Quoted
0.33
0.33
25.00
25.00
Quoted
305
Annexure to Information regarding Subsidiary Companies
Details of Investments as at 31-03-2013/31-12-2012
Name of the Company
No. of Shares/
Units/Bonds
Face Value
( )
Book Value
( crore)
Quoted/
Unquoted
Narmada Infrastructure Construction Enterprise Limited
Current investments:
Mutual Funds
L&T Liquid Fund Growth
24,890
1000
TOTAL
L&T Fund Management Private Limited
Current investments:
Mutual Funds
L&T Cash Fund - (Direct Plan) Growth
14,432
1000
TOTAL
L&T Infra Investment Partners Advisory Private Limited
Current investments:
Mutual Funds
ICICI Prudential Liquid - Regular Plan Daily Dividend.
52,636
100
TOTAL
L&T Special Steels and Heavy Forgings Private Limited
Current investments:
Mutual Funds:
ICICI Prudential Flexible Income DDR Plan
Birla Sunlife Cash Plus DDR Plan
4,82,208
7,61,264
100
100
TOTAL
L&T Vadodara Bharuch Tollway Limited
Current investments:
Mutual Funds
L&T Liquid Fund - Growth
37,334
1000
TOTAL
L&T Interstate Road Corridor Limited
Current investments:
Mutual Funds
L&T Ultra Short Term Fund - Growth
15,82,696
10
TOTAL
L&T Realty Limited
Current Investments:
Mutual Funds:
L&T Liquid-Fund-Growth
1,968
1000
TOTAL
306
Quoted
4.00
4.00
Unquoted
2.27
2.27
Quoted
0.53
0.53
Unquoted
Unquoted
5.10
7.63
12.73
Unquoted
6.00
6.00
Unquoted
3.00
3.00
Unquoted
0.31
0.31
Annexure to Information regarding Subsidiary Companies
Details of Investments as at 31-03-2013/31-12-2012
Name of the Company
No. of Shares/
Units/Bonds
Face Value
( )
Book Value
( crore)
Quoted/
Unquoted
L&T Kobelco Machinery Private Limited
Current Investments:
Mutual Funds:
L&T Liquid Fund Direct Plan Growth
L&T Cash Fund Direct Plan- Growth
TOTAL
L&T Metro Rail (Hyderabad) Limited
Current Investments:
Mutual Funds
7,470
9,290
1000
1000
1.20
1.47
2.67
Quoted
Quoted
L&T Liquid Fund-Daily Dividend
69,250
1000
TOTAL
L&T Devihalli Hassan Tollway Limited
Current Investments:
Mutual Funds
L&T Ultra Short Term Fund
52,75,653
10
7.01
7.01
Quoted
10.00
10.00
Quoted
TOTAL
L&T Unnati Finance Limited
Long term investment:
Fully paid equity shares:
City Union Bank Limited
Current Investments:
Mutual Funds:
1,91,95,012
10
33.39
Quoted
L&T Liquid Fund - Daily Dividend Reinvestments Plan
19,78,566
1000
TOTAL
L&T-Gulf Private Limited
Current Investments:
Mutual Funds:
L&T Liquid Fund Direct Plan Daily Dividend Reinvestment Plan
198
1000
TOTAL
L&T Housing Finance Limited
Long term investment:
Fully paid equity shares:
The Kalyan Janatha Sahkari Bank Limited
The Malad Sahakari Bank Limited
Government Securities:
7.50% Government of India Stock 2034
6.13% Government of India Stock 2028
Bonds:
7.30% Food Corporation of India Bonds 2015
SUB -TOTAL
Less: Provision for diminution in value
TOTAL
20,000
1,000
14,000
40,000
10,000
25
10
100
100
100
200.16
233.55
Quoted
Unquoted
0.02
0.02
0.05
–
Unquoted
Unquoted
Quoted
Quoted
Quoted
0.14
0.38
0.10
0.67
0.06
0.61
307
Annexure to Information regarding Subsidiary Companies
Details of Investments as at 31-03-2013/31-12-2012
Name of the Company
No. of Shares/
Units/Bonds
Face Value
( )
Book Value
( crore)
Quoted/
Unquoted
L&T Seawoods Private Limited
Current Investments:
Mutual Funds:
L&T Liquid Fund Direct Plan Daily Dividend Reinvestment Plan
L&T Cash Fund Direct Plan Daily Dividend Reinvestment Plan
3,43,078
3,97,077
1000
1000
34.71
Unquoted
40.63
Unquoted
TOTAL
L&T Shipbuilding Limited
Current Investments:
Mutual Funds:
L&T Liquid Fund - Growth Plan
Franklin Templeton - Growth Plan
Axis Liquid Fund - Growth Plan
DWS Treasury Fund - Growth Plan
IDFC Cash Fund Growth Plan
SBI Premier Liquid Fund - Growth Plan
L&T Cash Fund Growth Plan
TOTAL
Tractor Engineers Limited
Current Investments:
Mutual Funds:
25,494
51,089
72,438
44,903
1,40,459
1,08,648
1,25,584
1000
1000
1000
100
1000
1000
1000
L&T Ultra STF Direct Plan - Daily Dividend Reinvestment
21,44,533
10
TOTAL
75.34
3.97
Unquoted
8.74
Unquoted
9.11
0.56
Quoted
Quoted
20.00
Quoted
20.00
Quoted
20.00
Quoted
82.38
Quoted
2.16
2.16
308
Notes
Notes
LARSEN & TOUBRO LIMITED
Regd. Office : L&T House, Ballard Estate, Mumbai 400 001.
ANNUAL GENERAL MEETING - AUGUST 22, 2013 AT 3.00 P.M.
ATTENDANCE
SLIP
NAME AND ADDRESS OF THE REGISTERED SHAREHOLDER
D.P.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 Thursday, August 22, 2013.
Note : Please complete this and hand it over at the entrance of the hall.
SIGNATURE
LARSEN & TOUBRO LIMITED
Regd. Office : L&T House, Ballard Estate, Mumbai 400 001.
ANNUAL GENERAL MEETING - AUGUST 22, 2013 AT 3.00 P.M.
FORM OF
PROXY
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 Thursday, August 22, 2013 and at any adjournment thereof.
Signed this __________ day of _______________2013
D.P.Id
Client Id/
Folio No.
No. of
Shares
Signature ...................................................................
Affix a
1 Rupee
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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