Delivering on Commitments Dilip Buildcon Limited
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DELIVERING ON COMMITMENTS DILIP BUILDCON LIMITED ANNUAL REPORT 2018-19 CORPORATE INFORMATION BOARD OF DIRECTORS BANKERS & FINANCIAL INSTITUTIONS PRESIDENT & CFO Mr. Dilip Suryavanshi Punjab National Bank **CA Radhey Shyam Garg Chairman & Managing Director Bank of Baroda DIN : 00039944 Canara Bank COMPANY SECRETARY & COMPLIANCE State Bank of India Mr. Devendra Jain OFFICER Whole- time Director & CEO IDBI Bank Limited DIN : 02374610 Syndicate Bank CS Abhishek Shrivastava Andhra Bank Mrs. Seema Suryavanshi Allahabad Bank AUDITORS Whole- time Director Bank of India DIN : 00039946 Bank of Maharashtra Mukund M. Chitale & Co., Mr. Aditya Vijay Singh Central Bank of India Chartered Accountants, Independent Director Corporation Bank 2nd Floor, Kapur House, DIN :03585519 Indian Overseas Bank Paranjape B Scheme Road No. 1 The Jammu & Kashmir Bank Limited Vile Parle (E), Mumbai 400 057 Mr. Ashwini Verma Oriental Bank of Commerce Independent Director UCO Bank DIN :06939756 M/s MSG & Associates, The Lakshmi Vilas Bank Limited Chartered Accountants, Mr. Amogh Kumar Gupta Union Bank of India MIG-1/5, 1st Floor, Amber Complex, Independent Director United Bank of India Zone-II, M.P.Nagar, DIN : 06941839 Punjab & Sind Bank Bhopal 462 011 Karnataka Bank Mr. Satish Chandra Pandey Indian Bank Independent Director SECRETARIAL AUDITOR DIN : 07072768 REGISTRAR & SHARE TRANSFER AGENT Piyush Bindal & Associates Mr. Vijay Chhibber Company Secretaries Independent Director 1. FOR EQUITY SHARES S-12, 2nd Floor, Gurukripa Plaza, DIN : 00396838 Zone-II, M. P. Nagar, Link Intime India Private Limited Mr. Malay Mukherjee Bhopal-462011 C 101, 247 Park, L.B.S Marg, Vikhroli Independent Director (West), Mumbai, Maharashtra, 400083 DIN : 02272425 COST AUDITOR Tel No: +91 22-49186270 *Ms. Ratna Dharashree Vishwanathan Fax No: +9122-49186060 Yogesh Choursia & Associates Independent- Additional Woman Director Email : :[email protected] Cost Accountants DIN : 07278291 R-73, Zone -II, M.P. Nagar, 2. FOR DEBENTURE Bhopal (M.P) REGSITERED OFFICE M/s Alankit Assignments Limited DILIP BUILDCON LIMITED Alankit Heights, 3E/7, Jhandewalen Extension, New Delhi -110055 CIN : L45201MP2006PLC018689 Tel No: +91 11-42541959 Plot No. 5, Inside Govind Narayan Singh Fax No: +91 11-42541201 Gate, Chuna Bhatti, Kolar Road, Email : [email protected] Bhopal 462 016, Madhya Pradesh Tel No.: +91 755 4029999 Fax: +91 755 4029998 Email : [email protected]; Website: www.dilipbuildcon.com * Appointed as an additional woman Director in category of an independent Director w.e.f March 30, 2019. **Mr. Radhey Shyam Garg has been appointed as Chief Financial Officer w.e.f. December 10, 2018 and designated as the Key Managerial Personnel of the Company in place of Mr. Raja Ghosh, who has resigned from the post of Interim Chief Financial Officer on December 10, 2018 and further Mr. Radhey Shyam Garg has been designated as President & Chief Financial Officer w.e.f. June 01, 2019. DELIVERING ON COMMITMENTS The Infrastructure and EPC (Engineering, Procurement and Construction) industry in India GROWTH has been progressing at a scorching yet steady and consistent pace over previous few decades. DIVERSIFICATION The aspirations levels and living standards of the people in our country have been on the rise, and the infrastructure has to reflect these rising expectation CONSISTENT GROWTH levels and disposable income standards. This presents a humungous opportunity for firms which deliver quality at reasonable costs, to excel and SUSTAINABILITY deliver sustainable profitable growth to create shareholder value. CAPITAL STRUCTURE Dilip Buildcon Limited (DBL) is a leading EPC and infrastructure company which has been in the industry for more than three decades in India. It CORPORATE GOVERNANCE has become synonymous with success, excellence, trust and most optimal output for all stakeholders put together. We have steadily risen through the ranks and as a result of consistent organic growth, DBL is among the fastest growing infrastructure companies, today in India. The meticulous planning at each and every step of our operations, right from the project bidding stage to resource mobilization and earliest possible completion, is an evidence of dedication, efficiency, and vision of our 35,000 plus workforce. We pay special attention to the projects we want to take, equipment ownership, and maintaining uncompromising standards on the well- being of our workforce. The success of DBL is defined by Growth, Diversification, Consistency and Value Creation while creating a positive impact on the society and the nation. This reflects in; DILIP BUILDCON LIMITED 1 GROWTH which is sustainable and profitable We have been growing much faster than We take immense pride in the growth rate of industry we operate our execution capabilities in. We have an average revenue growth and timely completion of rate of more than 50% per year over projects. According to a report previous five years while the industry by parliamentary panel on trend is single digit growth over this National Highways Authority frame. of India (NHAI), only ~15% of the total projects had been completed on time over more than twenty years, from DBL has maintained 1995 to June 2016. DBL has a very fine balance significantly consistent track between order book record of completing ~90% of growth and profitability its projects before time, hence of projects we want earning early completion to work on. The order bonuses amounting to ₹ 4,373 book which is ₹ 2,11,718 million from 2012 to 2019. million in FY19 was ₹ 51,609 million in FY14. Over five years, this is a growth of more than 4 times at a CAGR of more than 32.7%. 2 DELIVERING ON COMMITMENTS | ANNUAL REPORT 2018-19 2 DELIVERING ON COMMITMENTS | ANNUAL REPORT 2018-19 DIVERSIFICATION which is synergistic and aligned with long term goals We have also been able to successfully improve the exposure of government projects and DBL had started its journey from Madhya hence, reducing the dependence Pradesh, where it has its headquarter. on private projects and ensuring Now the company is present in 17 states, improved payment visibility. As covering ~85% of India’s geographical on 30th September 2014, 48% of spread and effectively covering the projects were from the central almost the entire opportunity space in government, 17% projects from Infrastructure and EPC space. the state governments and private projects were 35%. As of 31st March 2019, 85% of our projects are from the central government and 15% Primarily from just road construction are of the state governments. The a few years ago, the Company has contribution of private projects is now successfully diversified into new virtually insignificant now. and interesting business segments including Tunnels, Bridges, Mining, Urban Development, Irrigation and Metro projects. The technical experience is getting richer and vistas for in-house capabilities are continuously expanding. DILIP BUILDCON LIMITED 3 DILIP BUILDCON LIMITED 3 CONSISTENT GROWTH Financials and Focus on Balance Sheet Strength The revenue of the company has increased from ₹ 26,301 million in FY15 to ₹ 91,646 million in FY19, which implies a 36.6% CAGR over previous four years. The Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) of the company was ₹ 5,716 million in FY15, which has increased to ₹ 16,508 million in FY19. The CAGR for EBITDA is 30.4% over previous four years. Profit After Tax (PAT) has increased from ₹ 1,447 million in FY15 to ₹ 7,639 million in FY19, which presents a CAGR of 51.6% in previous four years. The bottom-line has grown significantly more than the growth in top-line indicating judicious selection of projects, strong cost control measures and declining financial leverage. The ROE and ROCE in FY15 were 18.1% and 19.3% respectively, already very healthy returns on capital employed and equity invested. These numbers have improved further and for FY19, the ROE is 27.0% and the ROCE is 22.6%, which proves strong focus on asset turnover, most optimal usage of capital and consistent value creation for shareholders. 4 DELIVERING ON COMMITMENTS | ANNUAL REPORT 2018-19 4 DELIVERING ON COMMITMENTS | ANNUAL REPORT 2018-19 SUSTAINABILITY Long term Visibility and Building a Legacy In FY15, our revenue was Another key parameter to The debt levels are ₹ 26,301 million and the asses an EPC company is reasonable and the net debt ₹ 19,528 million. how efficiently they are primary usage of debt is For FY19, the revenue utilizing their working in purchase of equipment and net debt are ₹ 91,646 capital. While the revenue which is a source of million and ₹ 33,876 of the Company has strong competitive million, respectively. The grown 3.5 times, the advantage. In FY19, DBL like-to-like comparison working capital days had a net debt of ₹ 33,876 suggests that the have been significantly million, and a significant revenue has grown 3.5 reduced to more than part of it (~45%) was times, while the net 50% in the previous four equipment debt. debt has increased only years. 1.7 times. This clearly shows that growth in the Company is not driven by financial leverage and unsustainable capital structure. DILIP BUILDCON LIMITED 5 DILIP BUILDCON LIMITED 5 CAPITAL STRUCTURE Which is more efficient and focus on Asset Monetization Even in a challenging environment, the Company has managed to grow profitably and the focus firmly remains on creating a capital structure which could withstand the vagaries of evolution in business environment and less risky. This is because of the Company’s prudent bidding skills, financial discipline, execution capabilities, and work quality. The company has already received 3/4th of the total proceeds from previously monetised 24 HAM (Hybrid Annuity Model) projects and we are actively pursuing asset monetization opportunities for more projects. We are confident that our balance sheet will strengthen further post hiving off 12 more HAM projects. 6 DELIVERING ON COMMITMENTS | ANNUAL REPORT 2018-19 6 DELIVERING ON COMMITMENTS | ANNUAL REPORT 2018-19 CORPORATE GOVERNANCE Driven by Strong Internal Controls and Uncompromising Ethics We have one of the best-in-industry disclosure practices.