To the Members,
The Board of Directors of your Company are pleased to present the 48th
Annual Report of your company for the financial year ended March 31, 2024. This report
provides a comprehensive overview of the Company's performance, including a summary of
financial results and key highlights concerning the financial performance for the period
ended March 31, 2024.
FINANCIAL RESULTS
|
STANDALONE |
CONSOLIDATED |
PARTICULARS |
FY 2023-24 |
FY 2022-23 |
%age CHANGE |
FY 2023-24 |
FY 2022-23 |
%age CHANGE |
Total Income /Turnover |
12,387.85 |
10,261.63 |
20.72% |
12,870.52 |
10,749.89 |
19.73% |
Total Operating Income / Turnover |
11,950.40 |
9,921.20 |
20.45% |
12,330.91 |
10,367.93 |
18.93% |
EBITDA |
1,201.36 |
923.72 |
30.06% |
1,509.96 |
1,116.54 |
35.24% |
Profit Before Tax |
1,155.54 |
883.19 |
30.84% |
1,261.13 |
891.00 |
41.54% |
Profit After Tax |
862.90 |
776.83 |
11.08% |
929.51 |
765.23 |
21.47% |
Net Worth |
5,771.76 |
5,178.48 |
11.46% |
5,870.92 |
5,211.49 |
12.65% |
Appropriations |
|
|
|
|
|
|
Dividend (Final & Interim) |
291.56 |
282.16 |
3.33% |
|
|
|
EPS |
9.17 |
8.26 |
11.02% |
9.88 |
8.14 |
21.38% |
Notes: * Includes proposed final dividend [subject to the approval of
shareholders at the ensuing Annual General Meeting (AGM)].
FINANCIAL HIGHLIGHTS
Your Company has achieved highest ever total income of ' 12,387.85
Crore during FY 2023-24, compared to ' 10,261.63 Crore in FY 2022- 23, representing an
increase of approximately 20.72%.
Furthermore, the operating turnover of the Company for FY 2023-24 has a
rise of 20.45%, reaching ' 11,950.40 Crore, compared to ' 9,921.20 Crore in FY 2022-23.
[This growth can be attributed to a healthy order book and efficient execution of
projects].
Profit Before Tax (PBT) for FY 2023-24 reached ? 1,155.54 Crore, with
an increase of 30.84% compared to ' 883.19 Crore in FY 2022-23. Similarly, the Profit
After Tax (PAT) has reached to ' 862.90 Crore in FY 2023-24, shown a growth of 11.08% from
' 776.83 Crore in FY 2022-23.
The Net Worth of your company has increased from ' 5,178.48 Crore in FY
2022-23 to ' 5,771.76 Crore in FY 2023-24. Additionally, the earnings per share as of
March 31, 2024, stood at ' 9.17 per share, compared to ' 8.26 per share as of March 31,
2023 on a face value of ' 2 per equity share.
DIVIDEND
The Company's primary focus is on enhancing shareholder value. The
Company has a consistent track record of paying dividends since its inception. In FY
2023-24, the Board of Directors declared and disbursed an interim dividend of ' 1.80 per
equity share of a face value of ' 2/- per share. This amounted to approximately ' 169.29
Crore, (calculated at 90% of the paid-up share capital of ' 188.10 Crore). The interim
dividend was declared based on the Company's unaudited financial results for the quarter
ended December 2023.
Furthermore, the Board has recommended a final dividend of ' 1.30 per
equity share on the face value of ' 2/- each, totalling ' 122.27 Crore (65% of the paid-up
share capital of ' 188.10 Crore). This final dividend is subject to approval from the
shareholders at the ensuing AGM and is based on the Company's profits for FY 2023-24.
Considering these dividends, the total dividend for FY 2023-24 would
amount to approximately ' 291.56 Crore
(155% of the paid-up equity share capital of ' 188.10 Crore). This
represents 33.79% of the post-tax profits for FY 2023-24 and 5.05% of the net worth of the
Company as of March 31, 2024. Upon approval and payment of the proposed final dividend,
the cumulative dividend paid to shareholders until FY 2023-24 will stand approximately '
2,948.18 Crore.
The declaration of dividends aligns with the Dividend Distribution
Policy, which complies with Regulation 43A of the Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015 (LODR Regulations), as
amended, and the guidelines on "Capital Restructuring of Central Public Sector
Enterprises."
SHARE CAPITAL & DISINVESTMENT OF SHARES
As on March 31, 2024, the paid-up equity share capital of the Company
stood at Rs 188.10 Crore comprising of 94,05,15,740 equity shares of face value of ' 2/-
each. The shareholding of the Promoter of the Company i.e. the President of India stood at
65.17% of the total paid- up equity share capital of the Company, as on March 31, 2024.
IRCON is compliant on the Minimum Public Shareholding (MPS) requirements specified in Rule
19(2) and Rule 19A of the Securities Contracts (Regulation) Rules, 1957.
During FY 2023-24, the Government of India had disinvested 8.01% of the
total paid up equity share capital of the Company by way of Offer for Sale (OFS) through
Stock Exchange mechanism , including 8% of the total fully paid up equity shares of the
Company as on 30.09.2023 i.e. 94,05,15,740 through Offer for Sale Mechanism from
07.12.2023 to 08.12.2023 and 0.014% of the total fully paid up equity shares of the
Company to eligible employees of the Company on 22.12.2023 through Employee Offer for
Sale.
Pursuant to the above OFS, the stake of the Government of India has
been reduced from 73.18% to 65.17%.
Based on the market price of Ircon International Limited (IRCON) as on
March 31, 2024, it is placed in the top 500 listed companies. As on March 31, 2024, the
market capitalization of your Company stood at and ' 20658.43 Crore at National Stock
Exchange of India Ltd.
DEMATERIALISATION OF SHARES
All the shares, except 1887 shares as on March 31, 2024 are in physical
form, are held in dematerialised form and the details of the dematerialisation of shares
are provided in the Corporate Governance Report.
TRANSFER TO RETAINED EARNINGS
Appropriations to retained earnings for the financial year ended March
31, 2024 were ' 571.34 Crore after considering the total dividend of ' 291.56 Crore.
CAPEX AND LIQUIDITY
During the year, the Company on a standalone basis spent a sum of '
283.38 Crore on capital projects across domestic and foreign projects; which includes '
2.90 Crore towards construction of a building; ' 23.62 Crore for acquiring Plant &
Machinery; Rs.14.47 Crore for acquiring other assets; and ' 242.39 Crore towards
investments in SPVs.
The Company's liquidity position remains strong at ' 4429.13 Crore as
on March 31, 2024, comprising of ' 1828.88 Crore in cash and cash equivalent and ' 2600.25
Crore in other bank balances. Out of ' 4429.13 Crore, client/ project funds amount to '
3614.60 Crore.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Company has earned a foreign exchange of Rs 19704 Crore
cumulatively till date. During FY 2023-24, the Company has earned a foreign exchange of '
622.66 Crore as compared to ' 432.99 Crore in FY 2022-23. The foreign exchange outgo stood
at Rs 553.23 Crore during FY 2023-24 as compared to ' 406.83 Crore during FY 202223. Thus,
the net foreign exchange earnings amount to ' 69.43 Crore in FY 2023-24.
IRCON GROUP PERFORMANCE
During the year under review, IRCON along with its subsidiaries
(‘the Group') on a consolidated basis has recorded highest ever total turnover of '
12870.52 Crore (previous year: ' 10749.89 Crore). The Group has registered a quantum jump
of 18.93% in operating turnover to ? 12330.91 Crore (previous year ' 10367.93 Crore). The
Group reported a consolidated profit before tax of ' 1261.13 Crore (previous year ' 891
Crore) and profit after tax of ' 929.51 Crore (previous year: ' 765.23 Crore), both
registering increase of 41.54% and 21.47%, respectively.
The Group EBITDA was Rs 1509.96 Crore (previous year: ' 1116.54 Crore),
an increase of 35.24% over the previous year.
During the FY 2023-24, in terms of the financial performance, the
Company has achieved and crossed the Turnover targets criteria of ' 10650 Crore (on
Consolidated basis) set up by the Ministry of Railways in terms of the Memorandum of
Understanding based on the DPE guidelines.
GRANT OF "NAVRATNA" STATUS
DPE vide its letter dated October 12, 2023 has granted the
"Navratna" Status to the Company. Now, IRCON is the 15th Navratna
CPSE amongst the CPSEs, which got listed on September 28, 2018 and has established a sound
framework of Corporate Governance.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION
There are no material changes or commitments affecting the financial
position of the Company during and after the close of the financial year up to the date of
the report.
FINANCIAL STATEMENTS (STANDALONE AND CONSOLIDATED)
The Board of Directors of the Company has, at its meeting held on May
21, 2024, had approved the Financial Statements for FY 2023-24 (Standalone and
Consolidated).
In accordance with the provisions of Section 129 (3) of the Companies
Act, 2013, the Company has prepared its Consolidated Financial Statements
a) as per line-byline method for its wholly-owned subsidiaries viz.
Ircon Infrastructure & Services Limited (IrconISL), Ircon PB Tollway Limited
(IrconPBTL), Ircon Shivpuri Guna Tollway Limited (IrconSGTL), Ircon Davanagere Haveri
Highway Limited (IrconDHHL), Ircon Vadodara Kim Expressway Limited (IrconVKEL), Ircon
Gurgaon Rewari Highway Limited (IrconGRHL), Ircon Akloli-Shirsad Expressway Limited
(IrconASEL), Ircon Ludhiana Rupnagar Highway Limited (IrconLRHL), Ircon Bhoj Morbe
Expressway Limited (IrconBMEL), & Ircon Haridwar Bypass Limited (IrconHBL) and
subsidiary company viz. Ircon Renewable Power Limited (IRPL); and
b) as per equity method, for seven joint venture companies viz.
Ircon-Soma Tollway Private Limited (ISTPL), Indian Railway Stations Development
Corporation Limited (IRSDC) [not on a going concern basis], Chhattisgarh East Railway
Limited (CERL), Chhattisgarh East-West Railway Limited (CEWRL), Jharkhand Central Railway
Limited (JCRL), Mahanadi Coal Railway Limited (MCRL) & Bastar Railway Private Limited
(BRPL). The accounts of unincorporated joint ventures have been included in the standalone
financial statements for the FY 2023-24.
Pursuant to letter dated October 18, 2021 of Ministry of Railway, the
closure of business and transfer / hand over of business /assets of IRSDC is under
process. Accordingly, as part of the closure activities, all assets and liabilities of
IRSDC [other than its investment in its subsidiary companies viz., Gandhi Nagar Railway
and Urban Development Corporation (GARUD) and Surat Integrated Transportation Development
Corporation Limited (SITCO)] are to be transferred to Rail Land Development Authority
(RLDA)/ MoR on slump sale basis for a consideration not less than the book value as on the
cutoff date to be mutually agreed upon as approved in the BoD meeting of IRSDC. Closure
related activities initiated in FY 2021-22 are yet to be completed. The liquidation
process shall commence on completion of these activities and handing over of assets and
liabilities to RLDA/ MoR. Financial statement of IRSDC has been prepared on liquidation
basis. The Company does not foresee any impairment in the value of its investment as the
Company's share in the reported Net Worth of IRSDC is ' 60.29 Crore i.e.26% of ' 231.89
Crore vis-a-vis our shareholding of ' 52 Crore.
It has been decided to handover Phase- I (Angul - Balram, 14 KM already
operational) and Phase- II (Balram-Putgadia- Tentuloi,54 KM under construction)of MCRL
Project to the Ministry of Railways (MoR). The legal formalities, pricing and related
modalities are in process and the Company does not foresee any impairment in the value of
investment at this stage.
The Ministry of Railway (MoR) has granted in-principle approval for
closure of Bastar Railway Private Limited, a joint venture company and transfer of its
assets and liabilities to MoR. The legal formalities, pricing and related modalities are
in process and the Company does not foresee any impairment in the value of investment at
this stage.
The Company would make available its audited financial statements
(standalone and consolidated) for the FY 2023-24 and financial statements of its eleven
subsidiaries (IrconISL, IrconPBTL, IrconSGTL, IrconDHHL, IrconVKEL, IrconGRHL, IrconASEL,
IrconLRHL, IrconBMEL, IrconHBL & IRPL) at its website (www.ircon.org).
Further, a statement containing the salient features of the financial
statements of eleven subsidiaries and seven joint venture companies in Form AOC-1 is
attached to the Financial Statements.
The Ministry of Corporate Affairs and the Securities and Exchange Board
of India (SEBI) had allowed companies to send financial statements, including the Notice
of AGM, Board's Report, Auditor's Report, and other related documents, exclusively via
e-mail to members who have registered their email addresses with the company or with the
depository participant/depository, as well as to other eligible persons. These relaxations
have been extended until September 30, 2024, as per circulars dated September 25, 2023 and
October 7, 2023 issued by MCA and SEBI respectively.
Taking into account these relaxations and as part of our commitment to
environmental sustainability, the Notice of AGM and Annual Report will be electronically
delivered to shareholders who have already registered their email addresses with the
respective depository participants. These documents will be accessible on the Company's
website and will also be provided to the stock exchanges, namely BSE Limited (BSE) and
National Stock Exchange of India Limited (NSE).
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis (MDA) Report, as mandated by
Regulation 34 read with Schedule-V to the LODR Regulations and DPE Guidelines, has been
included as an annexure to this report. It is hereby incorporated by reference and serves
as an integral component of this report. The MDA Report provides a comprehensive review of
various aspects including the global and Indian economy, industry analysis, future
outlook, Company overview, legal status and autonomy, business divisions/ units, financial
and operational performance, projects executed during FY 2023-24, upcoming projects,
strengths, scope and opportunities, key concerns, business strategies, risk management,
adequacy of internal control systems, and significant developments in human resources.
EXTERNAL ENVIORNMENT
MACROECONOMIC CONDITIONS
According to the International Monetary Fund (IMF) in its World
Economic Outlook (April 2024), global growth, estimated at 3.2% in 2023, is projected to
maintain the same pace in 2024 and 2025. The forecast for 2024 has been revised upward by
0.1% from the January 2024 World Economic Outlook Update and by 0.3% from the October 2023
WEO. In contrast, India's growth is projected to remain strong, with rates of 6.8% in 2024
and 6.5% in 2025. This robust growth is attributed to sustained domestic demand and an
increasing working- age population.
Global headline inflation is expected to fall from an annual average of
6.8% in 2023 to 5.9% in 2024 and 4.5% in 2025, with advanced economies returning to their
inflation targets sooner than emerging market and developing economies. The forecast for
nonfuel commodity prices is broadly stable in 2024, with prices for base metals expected
to fall by 1.8%, on account of weaker industrial activity in Europe and China.
According to the provisional estimates released by the National
Statistical Office (NSO) on May 31, 2024, real GDP growth for 2023-24 was placed at 8.2%.
On the supply side, real gross value added (GVA) rose by 6.3% in Q4:2023-24. Real GVA
recorded a growth of 7.2% in 2023-24. Real GDP growth for 2024-25 is projected at 7.2%
with Q1 at 7.3%; Q2 at 7.2%; Q3 at 7.3%; and Q4 at 7.2%.
INFRASTRUCTURE & CONSTRUCTION INDUSTRY - GOVERNMENT INITIATIVES
& INDUSTRY OUTLOOK
Infrastructure is a crucial driver for the growth of other industries
and the overall development of India. Recognizing this, the government has prioritized the
enhancement of infrastructure and construction services through targeted policies. These
initiatives include open FDI norms, substantial budget allocations to the infrastructure
sector, and the Smart Cities Mission. Additionally, the Prime Minister has launched the
Gati Shakti Master Plan, aimed at integrating various modes of transportation to
accelerate infrastructure development across the country.
In Budget 2024-25, capital investment outlay for infrastructure has
been increased by 11.1% to Rs.11.11 lakh crore (US$ 133.86 billion), which would be 3.4%
of GDP. The Indian government has introduced various formats in order to attract private
investments, especially in roads and highways, airports, industrial parks and higher
education and skill development sectors. Private Equity- Venture Capital Arms invested US$
3.5 billion (across 71 deals) in Indian companies in May 2023.
National Highways play a very important role in the economic and social
development of the country by enabling efficient movement of freight and passengers and
improving access to the market. MoRTH and its implementing agencies have implemented
multiple initiatives in the last 8 years to augment the capacity of the National Highway
infrastructure in India. Roads & Highways account for the highest share, followed by
Railways and Urban Public Transport. The government has set ambitious targets for the
transport sector, including development of 2 lakh-km national highway network by 2025 and
expanding airports to 220. Additionally, plans include operationalizing 23 waterways by
2030 and developing 35 Multi-Modal Logistics Parks (MMLPs). The total budgetary outlay for
infrastructure-related ministries increased from around Rs.3.7 lakh crore in FY23 to Rs.5
lakh crore in FY24, offering investment prospects for the private sector across various
transport sub-segments.
Under the Budget 2024-25, the Government of India allocated Rs. 2.72
lakh crore (US$ 33.46 billion) to the Ministry of Road Transport and Highways. In February
2024, NHAI raised highest over Rs.15,624 crore (US$ 1.88 billion) through InviT mode. FDI
inflows in construction development stood at US$ 26.54 billion between April 2000 -
December 2023. The Government aims to construct 65,000 kms of national highways at a cost
of Rs. 5.35 lakh crore (US$ 741.51 billion).
The Indian Railways have developed a comprehensive National Rail Plan
(NRP) for India - 2030 with the goal of transforming the railway system into a
‘future-ready' infrastructure by the year 2030. The NRP is aimed to formulate
strategies based on both operational capacities and commercial policy initiatives to
increase modal share of the Railways in freight to 45%. The objective of the Plan is to
create capacity ahead of demand, which in turn would also cater to future growth in demand
right up to 2050 and also increase the modal share of Railways to 45% in freight traffic
and to continue to sustain it.
Under the Budget 2024-25, the government allocated US$ 30.3 billion
(Rs. 2.52 lakh crore) to the Ministry of Railways. In 2024-25 Indian railways is planning
to Create three important railway routes for moving energy, minerals, and cement
efficiently; connecting ports better; and improving busy traffic routes.
India's logistics market is estimated to be US$ 317.26 billion in 2024
and is expected to reach US$ 484.43 billion by 2029, growing at a CAGR of 8.8%.The
Ministry of Commerce and Industry, states that the logistics sector accounts for 5% of
India's GDP and provides jobs for nearly 2.2 crore Indians.
These efforts are crucial for boosting economic growth, improving
connectivity, and enhancing overall development across various sectors. The integration of
different modes of transportation can certainly lead to more efficient logistics and
quicker project implementation.
ORDER BOOK
In the industry that the Company pertains to, an order book is
considered an indicator of future performance since it represents a portion of anticipated
future revenue. The Company caters to both domestic as well as international markets and
receives orders both on competitive bidding as well as through nomination by the Ministry
of Railways.
Ministry of Railways have made a significant change in their policy on
allotting the projects to PSUs, and have ended the system of competitive bidding amongst
the eligible PSUs, and introduced competitive bidding for execution of railway works. The
Company has also taken up PPP project in roads & highway under Toll/HAM Model.
The order book as on March 31, 2024, is Rs 27208 Crore as compared to
Rs 35195 Crore as on March 31, 2023. The major new orders are from railway
electrification, highway project, metro track works, workshops, airports and renewable
energy; also civil and track work in prestigious High Speed Railway Project.
DOMESTIC PROJECTS
Since incorporation, the Company has diversified into various
infrastructure sectors and is now an established player in the field of railway and
highway construction. Moreover, it has diversified in many other areas such as power
transmission lines, sub-stations industrial complex, bridge and flyovers, tunnels,
electrical and mechanical work, signaling and telecom, production units, station building,
multi-function complex, construction of commercial, residential complexes, solar power and
airports. The diversification of project portfolio across various sectors has helped the
company in de-risking its construction business and reduce our dependence on any sector or
type of project.
In the coming future, IRCON shall continue to pursue projects of
High-Speed Rail, National Capital Region Transport Corporation (NCRTC), National Highways
Authority of India (NHAI), Indian Railways and other important and high value
infrastructure projects in India.
During the FY 2023-24, your Company was awarded the five projects in
India viz.,
1. Supply, installation, testing and commissioning of Integrated Tunnel
Communication Systems, OFC based industrial grade network system in Jiribam Khongsang
section of Jiribam - Imphal new Railway Line Project,
2. Procurement of Goods including Machinery, Plant & Equipment up
to the stage of successful installation, commissioning, training, FAC, etc.,
3. Composite works (Civil, Electrical and Mechanical) involving
construction of Industrial shops with PreEngineered Building (PEB), water supply system
drainage system, Electrification and illumination works, associated telecom works and
supplying & commissioning of specified Mechanical Machineries (EOT Cranes etc.) in
connection with Detachment free rake examination facilities (Ph-II) at Exchange Yard of
Bondamunda, South Eastern Railway.
4. Engagement of Nodal Agency for establishment of Technology Centres
across India under the scheme "Establishment of New Technology centre/ Extension
Centres".
5. Construction of Twin Tube Uni-directional Aizawl Bypass Tunnel of
2.5 km and its approaches of 2.1 km from km 10.600 to km 15.200 (Package-2) on Sairang -
Phaibawk section of NH-6 in the State of Mizoram on EPC Mode.
ONGOING PROJECTS:
A list of ongoing major projects in India is given at Appendix-A.
In FY 2023-24, the focus of your Company has been execution, faster
deliveries and meeting stringent timelines for overall optimal contribution to the much-
needed infrastructure growth. This is in line with the vision of our Hon'ble Prime
Minister and Hon'ble Minister of Railways. During the FY 2023-24, following were some of
the achievements of on-going major projects in India:
1. IRCON has successfully commissioned a total of 128.45 Km of rail
lines out of which 54 Km is New Line and 74.45 Km is Doubling for the targeted rail
sections.
2. IRCON has successfully commissioned 1152 RKM (Route Kilometer) of
Railway Electrification (RE) works in new line/double line/NCRTC and RE Projects etc.
Which is the highest electrification work ever in a year. Further, in RE projects, 7 nos.
132/25KV traction substations and 38 Km - 132 KV transmission line have been commissioned.
3. IRCON has commissioned highest ever Signaling works of 104 stations
in the year 2023-24.
4. In USBRL Project - J&K, Banihal - Sangaldan section (38.618 Km)
has been commissioned and opened in February-2024. Further, 38.6 Km Rigid Overhead
Catenary (ROC) system in Tunnels of USBRL Project has also been commissioned. This ROC
system was implemented for the 1st time in Indian Railways. Over Head Equipment (OHE)
works of 200 TKM at high altitude (650 meter above MSL) between Banihal to Baramulla
including Tunnel T-80 (11.2 Km) has been successfully commissioned. ElectroMechanical
& Safety ventilation (E&M) works consisting of electrical works with complete HT
& LT, Tunnel Ventilation System, Fire Fighting system & SCADA system of 38 Km has
been successfully commissioned.
5. In connection with Katni - Singrauli doubling project of East
Central Railway, one section from Mahroi to Vijaysota (19.13 Km) has been successfully
commissioned on 27th June, 2023.
6. In connection with Kiul-Gaya doubling project of East Central
Railway, the Section from Sheikhpura to Kashichak (15.4 Km) has been completed in
August-2023 and commissioned on 1st September, 2023 with a speed of 90 Kmph. Further,
section from Kashichak to Warisaliganj has been commissioned on 23rd January, 2024.
7. In Agartala - Akhaura New Rail Line project, Nischintapur (India) to
Gangasagar (Bangladesh) section has been inaugurated by Hon'ble Prime Ministers of both
the countries on 1st November, 2023 for Goods & Services.
8. In connection with Khulna - Mongla Port Rail Line project - Package
No. WD1, Hon'ble Prime Ministers of India and Bangladesh inaugurated the rail line on 1st
November, 2023 for Goods & Services. The project is completed and inspected by General
Inspector Bangladesh Railway (GIBR) on 30th April, 2024. Now, passenger trains have
started operations from 1st June 2024.
9. 345 RKM/440 TKM of OHE is commissioned under Lumding Division of
Northeast Frontier Railway (NFR) in FY 2023-24.
INTERNATIONAL PROJECTS
In FY 2023-24, the contribution of international projects to the total
revenue amounted to ' 574.82 Crore, which accounts for 4.81% of the operating turnover.
This is in comparison to Rs 411.84 Crore in FY 2022-23, which represented 4.15% of the
operating turnover.
The Company continues to actively participate in new projects in
foreign countries, and has ongoing projects in Bangladesh, Algeria, Sri Lanka, Nepal and
Myanmar. By continuing to diversify its business and geographical focus, the Company
strives to secure a broader range of projects to maximize business volume and profit
margins. Efforts are being made to secure foreign projects through Line of Credit/ other
project export funding arrangements of EXIM Bank of India and projects funded through
Multilateral funding agencies.
ONGOING PROJECTS
The Company is executing the following projects in foreign countries:
i. Bangladesh
(a) Khulna-Mongla Port Rail Line project
The Company secured a project in Bangladesh for construction of
Khulna-Mongla Port Rail Line for Bangladesh Railway, at US$ 147.78 million (equivalent to
approx. Rs 911 Crore) and the revised cost of project after approval of variation order is
US$ 211.77 million. The project includes construction of embankment, tracks, all civil
works, major and minor bridges (except Rupsha Bridge), culverts and implementation of EMP
against Package WD1. Additional scope of work was added in 2021. Project stands completed
on 31st March, 2024 and General Inspector Bangladesh railway (GIBR) Inspection was
conducted on 30th April, 2024. Subsequent to GIBR approval for running of passenger
trains, trains have started operations from 1st June, 2024.
(b) Agartala (India)-Akhaura project (Bangladesh portion)
The Company had signed a contract for providing Technical Advisory
Services (TAS) for Construction of New Railway Line from Agartala (India) -Akhaura
(Bangladesh) and Project Management Consultancy (PMC) for Construction in Bangladesh
Portion with Ministry of External Affairs (MEA), Government of India. The construction
contractor for the project is appointed by Bangladesh Railways for a contract value of BDT
240.9 Crore (equivalent to approx. Rs 209.47 Crore). The completion period of the
construction contractor has been extended up to 30th June 2024. The overall progress of
the Project is approximately 96% and now, only building and platform works are pending.
However, the Trial run was done on 30th October, 2023 and project was inaugurated by Prime
Ministers of both countries on 1st November, 2023.
ii. Algeria
The project was awarded by ANESRIF, the National Agency for the
Planning and Implementation of Railway Investments, Ministry of public works and
investments, Government of Algeria, at a value of Algerian Dinar 1,628 Crore (equivalent
to approx. Rs 1,003 Crore) with completion date of November 2012. The project involves the
construction of the second line and upgradation of the existing lines, with a diversion of
10 km for the Relizane city, from the station Oued sly to the station Yellel in
Algiers-Oran section of Algerian Railways. The value of the contract, including additional
works for the construction of the double line, has been revised to Algerian Dinar 3,268
Crore (equivalent to approx. Rs 2,342 Crore).
Installing of 210 Km of track (out of the total 218 Km) has been
completed. Out of this, 82 km of new track line has been made operational. Work on the
existing line has also been started and a total stretch of 71.5 km out of 74 km of the
existing line, 6 out of 7 station buildings are ready to be handed over, and 9 major
bridges (out of 10 Nos) have also been completed. The project is expected to get completed
by December 2024.
iii. Sri Lanka
(a) Upgradation of Railway Line from Maho Omanthai under Indian Line of
Credit - Track Rehabilitation and ancillary works.
In Sri Lanka, the Company had secured a project for "Upgradation
of Railway Line from Maho Omanthai under Indian Line of Credit - Track Rehabilitation and
ancillary works". The project was awarded by Sri Lankan Railways under the Ministry
of Transport and Civil Aviation, Government of Sri Lanka at a value of US$ 91.27 Million
(equivalent to approx. Rs 637.22 Crore) through competitive bidding.
The project was awarded on 29th April 2019 with completion period of 36
months (starting from date of receipt of advance payment, 29th November,2019). The project
is financed through EXIM Bank of India as per Indian line of credit. The date of
completion of the project as per the contract is 28th November, 2022. The project was
delayed due to Covid-19 pandemic restrictions and subsequent economic and fuel crisis in
Sri Lanka.
The first phase of Upgradation from Anuradhapura and Vavuniya Section
(48.5KM) during the mega traffic block has been completed and commissioned in July, 2023.
Further, 2nd Phase Mega Traffic Block for upgradation of the remaining
section from Maho to Anuradhapura (65 Km) has been arranged from 7th January, 2024 and
upgradation of this section is in progress. Likely date of completion of the Project is
31st August, 2024 considering the inclement weather and heavy rains in the project
corridor.
The overall progress of the project is approx. 70%.
(b) Procurement of Design, Installation. Testing, commissioning, and
certifying of Signaling and Telecommunication system from Maho Junction (Including) to
Anuradhapura (Excluding) under Indian Line of Credit:
The work for "Procurement of design, installation, Testing,
commissioning, and certifying of Signaling and Telecommunication system from Maho Junction
(Including) to Anuradhapura (Excluding)" was awarded to your company through Exim
Bank of India under Indian Line of Credit.
The project was awarded on 4th December, 2022 by Sri Lankan Railways
under the Ministry of Transport and Civil Aviation, Government of Sri Lanka at a value of
US$ 14.90 Million (equivalent to approx. Rs 121.25 Crore) through competitive bidding.
Scheduled completion period was 12 Months from the date of receipt of mobilization
advance.
Contract Agreement has been signed on 21st September,2023. Contract
Inclusion is yet to be approved by Exim Bank of India. Project is yet to start.
iv. Nepal
In Nepal, the Company is executing the following two projects:
(a) Construction of Broad Gauge (BG) line between Jogbani (India)-
Biratnagar (Nepal) on Indo-Nepal border
The project involves construction of new BG rail line from Bathnaha
(India), Ch. 0.00 Km to Biratnagar (Nepal), Ch. 18.60 Km. The proposed alignment in Indian
portion (5.45 Km) falls in Araria district of Bihar State under Katihar Division of North
East Frontier Railways and proposed alignment in Nepal portion (13.15 Km) falls in Morang
district of Nepal.
The revised value of contract of ? 401.65 Crore is under approval of
the Ministry of External Affairs.
The section from Bathnaha (India) Ch. 0.00 Km to Nepal Custom Yard
(Nepal) Ch. 6.70 Km has been commissioned for freight traffic on 1st June, 2023. The work
is in progress in the remaining portion.
The overall progress of the project is approximately 86%.
(b) Construction of BG Line by Gauge conversion Jayanagar (India) -
Bijalpura (Nepal) with extension upto Bardibas on India Nepal Border
The project involves construction of a new BG rail line from Jaynagar
(India), Ch. 0.00 Km to Bijalpura (Nepal) Ch. Km 52.336 with extension up to Bardibas, Ch.
Km 68.72. Out of the total proposed alignment, 2.975 Km falls in Madhubani district of
Bihar state in India and 65.745 Km falls in Mahottari district of Nepal. The revised
estimate of Rs 783.83 Crore is under approval of the Ministry of External Affairs.
Your Company on behalf of the Government of India has handed over the
newly commissioned cross border rail section (Section-1) from Jayanagar (Km. 0.00) to
Kurtha (Km. 34.90) to Government of Nepal on 22nd October, 2021 which was inaugurated
through virtual mode by the Hon'ble Prime Minister of India and the Hon'ble Prime Minister
of Nepal on 2nd April, 2022. The first phase of 34.9 Km Jaynagar (India) - Kurtha (Nepal)
section is part of 68.72 Km Jaynagar-Bijalpura-Bardibas rail link being built under
Government of India grant assistance of Nepalese Rupee 8.77 billion. Section-2 from Km
34.900 to km 52.34, Kurtha- Bijalpura has also been completed and commissioned on 16th
July 2023. In Section-3 from Km 52.34 to Km 68.72, Bijalpura-Bardibas, land was handed
over on 7th November, 2023 by the Government of Nepal. The overall progress of the project
is approximately 74%.
v. Myanmar
The Company has secured a project in Myanmar in FY 2022-23, for Balance
work of construction of road from Paletwa (Myanmar) to Zorinpui (Mizoram) (Kaladan Road
Project) under Kaladan Multi-Modal Transit Transport Project (KMMTT Project), from the
Ministry of External Affairs, on EPC mode at a lump sum cost of Rs 1780 Crore.
Construction of this project is intended to open up an alternate route to North-East
Region and connect Mizoram with Chin State of Myanmar at Zorinpui. The agreement for the
execution of this project has been signed on 7th March, 2022 and the project is to be
completed within 40 months from the date of the signing of the agreement.
During FY 2023-24, work commenced on a 50 Km stretch (40 Km from
Paletwa end (Myanmar) & 10 Km from Zorinpui end (India-Myanmar Border).
Due to ongoing armed conflicts between Myanmar Army and Insurgent
groups the progress of work is adversely affected.
However, Ircon has shown great resilience and commitment to progress
the work. Overall progress of the project is 10%.
REAL ESTATE SECTOR
IRCON has identified Real Estate Sector as one of the sectors for
diversification, keeping in view the tremendous potential in this Sector. Your Company had
acquired 8 plots in different sectors, on leasehold basis for 90 years, at NOIDA and has
successfully Leased out 22,023 Sq. mt. of built - up space for Commercial and Office use.
The Company has also developed property in Sector 32, Gurugram, Haryana and this property
is registered with the trademark authorities in India as ‘IRCON INTERNATIONAL TOWER'.
Entire leasable spare has been leased out to different government agencies.
IRCON Retail Mall at Sector - 43, NOIDA, Uttar Pradesh and Commercial
cum Office Building at Sector -48, NOIDA, Uttar Pradesh has been leased out completely.
COMPANIES, JOINT VENTURE COMPANIES AND ASSOCIATE COMPANIES
A brief background on the eleven subsidiary companies and seven joint
ventures companies of IRCON along with their financials and performance is given at
Appendix-B.
In terms of the Company's Policy on the determining the "Material
Subsidiary" and Regulation 24A of the LODR Regulations, for the financial year ending
March 31, 2024, none of the subsidiary company is a ‘material subsidiary' i.e. whose
total income or net worth exceeds 10% of consolidated income or net worth of IRCON in the
immediately preceding financial year i.e. March 31, 2023.
COMPLIANCES OF PRESIDENTIAL DIRECTIVES
Presidential directives as issued from time to time on various matters
like reservation policy for reserved category persons, SC/ST roster in the employment,
revision in pay scale 2017 etc. have been complied with.
OFFICIAL LANGUAGE
The Company is undertaking various novel and encouraging initiatives
for extensive use of Hindi in the office. Some of them are:
a. Pledge by all employees to work in Hindi completely on last Monday
of every month.
b. Rajbhasha Sanghosthi is being conducted on a quarterly basis in
Corporate Office.
c. Birthday wishes to employees, a thought and a word, contributed by
different departments on rotational basis, a poem by renowned poets etc. are being
displayed in Hindi at the reception.
d. Thought of the day and a word in Hindi is displayed at reception,
which is contributed by departments daily on rotation basis.
Regular quarterly meetings of Official Language Implementation
Committee and quarterly workshops for effective use of the Hindi Technical system and
official language are being conducted. Under the auspices of NARAKAS, competitions are
organized by IRCON every year. Every year, the IRCON corporate office organizes Hindi
competitions for the children and family members of the employees. The bilingual facility
has been introduced for computer systems and mobile phones used by officials of the
Company. Bilingual formats have been made available at IRCON's internal website for use by
the employees.
COMPLIANCE OF RIGHT TO INFORMATION ACT, 2005
In accordance with the provisions of the Right to Information Act-2005,
IRCON has ensured the availability of updated information, including the names of the
Appellate Authority, Central Public Information Officer, Assistant Public Information
Officer and State Level Public Information Officers on our website. We have promptly
responded to the queries received within the specified time frame. These queries primarily
pertained to service matters, recruitments, finance, contract, corporate social
responsibility (CSR) and projects. The details of RTI cases have been regularly published
on website of the Central Information Commission (CIC) on quarterly and annual basis.
During the year 2023-24, 168 applications and 36 first appeals were
received and at the beginning of the year 12 applications and 02 appeals were under
process for disposal within the allowable time limit (i.e. total 180 applications and 38
appeals during the year). Out of which, 169 applications (including opening balance of 12
applications) and 36 First Appeals were disposed of. As on 31.03.2024, 11 applications and
02 appeals were under process for disposal within the allowable time limit.
COMPLIANCE OF IMPLEMENTATION OF PUBLIC PROCUREMENT POLICIES FOR MSEs
AND PREFERENCE TO MAKE IN INDIA
The Company has in place a comprehensive Purchase Preference Policy
since June 2012 which is in line with the Public Procurement Policy for Micro and Small
Enterprises (MSEs) Order, 2012 notified by the Ministry of Micro, Small and Medium
Enterprises (Ministry of MSME) under section 11 of Micro, Small and Medium Enterprises
Development Act, 2006. IRCON uses Central Public Procurement portal (CPPP) and Government
e-Marketplace (GeM) portal for its procurement, which provides facilitation of
registration of MSEs firms registered with any statutory bodies specified by Ministry of
MSME.
The Company has always encouraged local suppliers to participate in its
tendering process and also promote them through training and hand holding programs. Our
continued pursuit in this direction has seen improved participation of small local players
and socio-economic development of communities in and around operational locations.
IRCON has taken several steps for effective implementation of MSE
policy. The benefits of waiver of cost of tender documents and deposit of earnest money
and purchase preference prescribed under the Policy, are incorporated in the tenders for
procurement of goods and services.
The company has been extensively following the guidelines of Government
on procurement through GeM and provisions are also made in tenders to promote "Make
in India" directives of the Government of India.
Tenders valuing upto Rs.200 Crore are invited using national
competitive bidding in compliance to Public Procurement (Preference to make in India),
Order 2017.
During the FY 2023-24, the Company has procured items valuing Rs 80.52
Crore from MSE vendors against expenditure valuing Rs 135.58 Crore (excluding the
procurement of items which are beyond the scope of MSEs) towards material, stores &
service, thereby achieving 59.39% procurement from MSEs against the compliance requirement
of 25% as per the procurement policy. The Company has conducted one national level Special
Vendor Development Program at the Corporate Office, Delhi on December 22, 2023 and Govt.
of India, Ministry of MSME ,MSME DFO,Okhla ,New Delhi in association with Ircon
International Ltd (a CPSE under Ministry of Railways),NSIC ,Govt E-Marketplace (GeM) and
other CPSUs and local MSME associations organized two days vender development program cum
industrial exhibition at GL Bajaj Institute of Management & Technology Knowledge
Park-II, Greater Noida , Distt. Gautam Budh Nagar on 6th and 7th March 2024.
In compliance with the Micro, Small and Medium Enterprise Development
Act, 2006, the Company has on- boarded on the Trade Receivables Discounting System (TReDS)
platform, w.e.f. January 25, 2018, to facilitate the financing of trade receivables of
MSEs by discounting of their receivables and realisation of their payment before the due
date. A clause in General Conditions of Contract is incorporated for MSEs vendors willing
to avail the facility.
HUMAN RESOURCE DEVELOPMENT
IRCON recognizes that its employees are fundamental to its success and
play a crucial role in safeguarding the organization's values and culture. The
organization firmly believes that its achievements rely on the alignment and performance
of its workforce, as well as maintaining a positive work environment. It is committed to
establishing a collaborative, inclusive, and performance-driven atmosphere that fosters
learning, growth, and overall employee well-being.
IRCON's Human Resource (HR) Philosophy revolves around empowering and
nurturing employees, allowing them to reach their full potential, encouraging innovative
ideas, and providing rewards based on performance. The company's work culture is
characterized by openness and dynamism, empowering employees to take initiative in their
roles with full support from top management.
At IRCON, the Human Resource Management (HRM) team is dedicated to
recruiting, retaining, and developing the right people. They continuously strive to create
an optimal work environment that is inclusive, open, diverse, and provides equal
opportunities for all employees. The company has aligned its HR strategy, systems, and
procedures with its business objectives, focusing on building competencies necessary for
organizational success. This strategy serves as a motivating force for employees, bridging
the gap between the company's future needs and individual aspirations.
IRCON maintains a performance-oriented culture where the contributions
of every employee are measured and appropriately recognized. The Company has implemented a
robust Performance Management System (PMS) that aligns with its philosophy of rewarding
and acknowledging merit at all levels. This system supports the professional development
of executives through a structured approach integrated into the company's performance
appraisal process. IRCON takes pride in its highly motivated and competent human resources
and acknowledges their significant contributions.
MANPOWER STRENGTH
The total manpower strength of IRCON as on March 31, 2024, stood at
1270, (previous year 1341) which included 857 regular employees, 32 employees on
deputation, 377 on contract (including service contract) and 04 on fixed tenure basis. Out
of the total employees of the Company, 1220 are posted on Indian projects and 50 on
international projects. Among 1270 employees, 899 are technically and professionally
qualified. There was a total of 60 women employees as on March 31, 2024.
The overall income per employee for FY 2023-24 stood at Rs 9.75 Crore
as compare to ? 7.65 Crore in FY 2022-23.
During the year, the total newly employed personnel stood at 155 which
included 10 regular employees, 4 employees on deputation, and 141 on contract (including
service contract).
RESERVATION IN EMPLOYMENT
The Company continues to give utmost importance to the implementation
of the policies and directives of the Government of India in matters relating to
reservations in the employment of candidates belonging to Scheduled Caste (SC) / Scheduled
Tribe (ST) / other backward classes (OBC) and differently-abled categories. There was a
total of 526 SC / ST / OBC and differently- abled employees as on March 31, 2024.
Further, during the FY 2023-24, out of the 10 employees inducted
against regular posts, 3 belong to SC / ST / OBC and differently-abled categories.
Similarly, out of the 108 employees recruited against the contractual positions, 44 belong
to SC / ST / OBC / EWS and differently- abled categories.
During the FY 2023-24 training has been given to 1015 employees, out of
which 451 belong to SC/ST/OBC and differently-abled categories. To ensure the welfare of
these employee categories, the Company has appointed Liasion Officers.
The infrastructure of the Company is well built catering to the needs
of differently-abled employees.
TRAINING AND HUMAN RESOURCE DEVELOPMENT
IRCON puts a lot of emphasis on development and career progression of
employees. Training programs are organised throughout the year. During the FY 2023-24,
inhouse training programmes across all levels of employees were organised. Professional
programmes, workshops, and seminars organised by reputed and prestigious institutes /
agencies were carefully identified in line with business needs of IRCON, and suitable
officers were nominated for such programmes.
The Company has been continuously taking steps for building capacity of
its human resource through training in functional and general management areas, contract
and arbitration, leadership, information technology, as well as soft skills. External
faculty is arranged wherever required, and officials are nominated for carrying out
workshops and seminars with reputed institutes. Employee Development has always been a
priority for the Company, and various training and development plans have been initiated
from time to time. During the FY 2023-24 a total 1032 man- days training was imparted to
officials of IRCON through workshops, seminars, conferences, in-house training and
training in external institutes.
EMPLOYEE WELFARE
The Company has adequate and robust schemes in place for the welfare of
the employees. These are health cover, medical scheme, post-retirement medical scheme,
postretirement pension scheme, periodic health check-ups at regular intervals, allowances,
self-lease for residential accommodation, educational scholarships to the wards of
employees, a one-time educational grant for admission to professional degrees and diploma
courses, educational awards to meritorious children of employees, educational assistance
to the wards of deceased employees, assistance for marriage of daughters and dependent
sisters of employees in non-executive categories, and resort facilities for employees and
their family members on concessional rates through Dalmia and Sterling Resorts.
DISCLOSURE AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
Your Company is dedicated to creating a supportive and secure working
environment for its women employees. The Company has implemented a comprehensive policy
for the Prevention, Prohibition, and Redressal of Sexual Harassment at the Workplace,
which applies to all employees, including regular employees, deputationists, temporary
workers, ad-hoc employees, contract workers, daily wage workers, and individuals employed
through agencies or contractors. This policy, along with its details, can be accessed on
the Company's website. Furthermore, this policy extends to wholly-owned subsidiary
companies of IRCON that are formed as Special Purpose Vehicles.
Your Company has ensured compliance with the provisions concerning the
formation of the Internal Committee (IC) as mandated by the Sexual Harassment of Women at
Workplace (Prevention, Prohibition, and Redressal) Act, 2013. The IC comprises five
members, including four Company officials and one external member from an NGO.
Additionally, provisions related to the prohibition of sexual harassment have been
incorporated into the IRCON's Conduct, Disciplinary, and Appeal Rules. At the beginning of
the year, no complaint was pending. No complaint of sexual harassment was received during
the year.
CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABILITY
In accordance with Section 135 of the Companies Act, 2013 and The
Companies (Corporate Social Responsibility Policy) Amendment Rules 2021, IRCON has updated
its CSR Policy duly approved by the Board of Directors of IRCON. CSR is essentially a way
of conducting business responsibly and IRCON shall endeavor to conduct its business
operations and activities in a socially responsible and sustainable manner at all times.
IRCON will strive to contribute to inclusive growth and sustainable development with
emphasis on development of weaker sections of society and in the Aspirational Districts of
the country. As per broad objectives of the Policy, CSR activities are being implemented
in project/ program mode, in areas or subjects specified in Schedule VII of the Act, on
thrust areas of education and health care, in the periphery of project areas of IRCON
(local area).
In accordance with the guidelines issued by the Department of Public
Enterprises (DPE) through their Office Memorandum dated December 10, 2018, along with the
update on April 24, 2023, CPSEs (Central Public Sector Enterprises) are required to follow
a theme-based approach for their CSR activities. The Company allocates a minimum of 60% of
their annual CSR budget for thematic programs and give preference to the Aspirational
districts in their CSR initiatives. For the FY 2023-24, By adhering to these guidelines
and embracing the chosen theme, we are actively working towards making a positive
difference in society and contributing to the well-being of our communities.
During the year, our company took a focused approach to conceive and
implement CSR activities with the aim of generating maximum impact for the target
beneficiaries. These initiatives were carried out in collaboration with reputable
implementing agencies. In the FY 202324 Company has Spent 11.65 Cr against the Allocated
CSR Budget of Rs.11.64 Cr. During the Year Company Implemented 72 Projects in Pan India
Within this budget, a significant portion was dedicated to the health sector, including a
contribution of Rs 0.67 Crore to the PM CARES Fund. During the Year Company Covered 14
Aspirational districts by Conducting Health Camps, provided nutritional foods to pregnant
women's and children's, conducted sports activities for girls, provided astronomy labs and
furniture's in government schools.
The CSR Policy, which provides comprehensive guidelines for conducting
CSR activities, is available on our Company's website: www.ircon.org. Furthermore, the
Annual Report on CSR & Sustainability activities, in compliance with Section 135 of
the Companies Act, 2013, and the Companies (Corporate Social Responsibility Policy)
Amendment Rules 2021, is appended to this report, forming an integral part of it.
QUALITY, HEALTH AND SAFETY QUALITY MANAGEMENT SYSTEM
IRCON is a precursor Public Sector Organization in adopting the Quality
Management System Certification in the domestic as well as International Markets. Quality
Management System (QMS) has been successfully sustained and continually improved since
1996 when the
Company as a whole was first certified for ISO 9002:1994 by TUV SUD
Private Limited. IRCON has continued the certification and sustained the system as per the
latest version of Quality Management Standards i.e. ISO 9001:2015 (by periodical
re-certification audit after the expiry of every three years). Latest surveillance audit
was conducted by TUV SUD South Asia Private Limited in the month of November 2023, and the
validity of the certificate is up to March 2026.
OCCUPATIONAL HEALTH AND SAFETY MANAGEMENT SYSTEM
The Company established an Occupational Health & Safety Management
System and was certified for ISO 45001:2004 in October, 2011. The latest surveillance
audit for ISO 45001:2018 was conducted by TUV SUD South Asia Private Limited in the month
of October, 2023 and the validity of the certificate is up to December, 2024.
ENVIRONMENT MANAGEMENT
The Company established an Environment Management System (EMS) and was
certified for ISO 14001:2004 in October, 2011. The latest surveillance audit for ISO
14001:2015 was conducted by TUV SUD South Asia Private Limited in the month of November,
2023 and validity of the certificate is up to February 2026.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND UPGRADATION
IRCON is conscious of the limited nature of conventional sources and
the importance of using energy resources wisely. The Company has been consistently laying
emphasis on utilizing energy efficient equipment in its office premises and in various
projects so as to minimally affect the ecology and environment. Towards conservation of
energy, IRCON has taken the following steps:
a) IRCON has a total of 90 kW Grid Connected roof top Solar Power Plant
installed at Corporate Office which is a considerable step to conserve energy and
contributing to environment through usage of Green Energy. The total energy produced by
Solar Power plant is approximately 89,471 units annually which is 9.08% of the energy
being drawn from the electrical grid. Further, the Rooftop Solar Capacity of 90 kW is
being upgraded to 200 kW along with installation of Battery Energy Storage System for more
optimization. IRCON has also installed a total of 75 kW Roof top Off Grid Solar Power
Plant at its IRCON Tower, Gurugram thereby reducing energy consumption. Also, capacitor
banks of 600 kVAR capacity have been installed at Corporate Office building and 1600 kVAR
at IRCON's Gurugram Building to improve the power factor, which further reduces the
Electrical Energy consumption by more than 10%.
b) Furthermore, energy-efficient LED lights are used for the internal
lighting of Corporate Office building which also adds in considerable energy saving when
compared with normal lights.
c) Automatic / Dynamic Reactive Power Factor (APF) correction /
compensation panels with Insulated Gate Bipolar Transistors (IGBT) technology of 10.7 MVAR
capacity have been designed and being installed at the Receiving Substations (RSS) for
Delhi-Ghaziabad-Meerut RRTS corridor of NCRTC project for RSS Energy Conservation.
Moreover, the RSS Control Room Building is also constructed with highest rating of Indian
Green Building Council (IGBC) standards to conserve energy.
d) IRCON has installed more than 20,000 LED lights at USBRL E&M
Tunnel Projects which have reduced the energy consumption considerably. Moreover, IRCON
has also installed energy efficient LED lights for energy conservation in various projects
like Loco Shed at Bondamunda, Katni-Singrauli RE Project, etc. for reducing energy
consumption.
e) Capacitor Banks of 2400 kVAR capacity each have been installed at
Baramulla, Qazigund & Budgam TSS (J&K) for USBRL RE project and 04 Nos. Traction
Sub-Stations (TSS) of Katni-Singrauli Project to improve the power factor. Further,
Capacitor Banks of 5500 kVAR capacity each have been installed in 08 Nos. TSS of various
Railway Electrification projects. Furthermore, for Tunnel Substations a total of 16 MVAR
capacitor banks have been installed to regulate the reactive power generation due to jet
fans, thereby reducing energy consumption.
STEPS TAKEN BY THE COMPANY FOR UTILISING ALTERNATE SOURCES OF ENERGY:
The Company is utilising the following as an alternate source of
energy:
a) Apart from installation of Roof top Solar Plant at IRCON's Corporate
office, IRCON is also executing a major project for utilizing alternate sources of energy
by Setting up a 500 MW Solar Photovoltaic Power Plant at Pavagada, Karnataka by using
latest technology Monocrystalline Passivated Emitter and Rear Cell (PERC) Bi-facial Solar
Photo Voltaic (SPV) Modules with Tracker technology which shall supply approximately 1076
million Units per year to Railways.
b) IRCON is also providing features similar to Green Buildings
Constructions at Corporate Office, Gurugram building and its project offices thereby
reducing the environmental impacts on water, materials, waste, energy and carbon
emissions. IRCON has installed solar panels at various offices/ projects; along with
sensor lights & sensor taps to conserve electricity.
c) IRCON has also installed Solar Power Photovoltaic Panels for its
office Complex in Sangaldan (J&K) with a capacity of 110 kWp.
CAPITAL INVESTMENT ON ENERGY CONSERVATION EQUIPMENT:
IRCON has invested approximately ? 4.00 Cr. for replacing the existing
Heating, Ventilation & Air Condition (HVAC) System at Corporate office with new
technology Energy Efficient Inverter Type Air Conditioning System which shall reduce the
energy consumption by 20-30%.
Further, the old refrigerant of R-22 is replaced by the new technology
refrigerant R-410A which is environment friendly and reduces the carbon emissions helpful
in sustainable development.
TECHNOLOGY ABSORPTION AND UPGRADATION EFFORTS MADE TOWARDS TECHNOLOGY
ABSORPTION:
Your company has developed critical machineries, required for National
High Speed Rail Project from Ahmadabad to Mumbai, under Make-in-India program by guiding
Indian Manufacturer's on the technical design and specific functional requirement of the
track machines. These machines include Rail Feeder Car, Track Slab Laying Car, Track motor
Car, Trolley Wagons, Flash Butt Welding Machine, etc. These machines are specially
developed in the same line as that of Japanese technological requirements.
In addition to above, State of the Art Factory for manufacturing
J-slabs for balastless track has also been set up for High Speed Railway Track, being
executed with Shinkansen Technology. Many components for the High Speed Track, such as,
CAM bags, Synthetic Resin Pads, adjustable pads, Insert C& D for J-slabs, have been
developed indigenously reducing dependence on imported component and saving in foreign
exchange.
BENEFITS DERIVED LIKE PRODUCT IMPROVEMENT, COST REDUCTION, PRODUCT
DEVELOPMENT OR IMPORT SUBSTITUTION
In this endeavour, IRCON has not only developed Indian manufacturers at
par with Japanese design but also saved a significant cost to IRCON (more than Rs. 100
Cr.) by getting these track machineries manufactured in India instead of procuring these
machines from Japan.
IN CASE OF IMPORTED TECHNOLOGY (IMPORTED DURING THE LAST THREE YEARS
RECKONED FROM THE BEGINNING OF THE FINANCIAL YEAR) - N.A.
RESEARCH AND DEVELOPMENT
The Company being primarily an EPC company does not undertake any pure
research project but takes the help of consultants and firms to innovate and to develop
methods and techniques to execute projects in a cost- effective manner, with requisite
quality, to enhance the technical competence and efficiency.
INFORMATION TECHNOLOGY AND ERP
The Company's Information Technology (IT) department offers a range of
services encompassing Data Networks, implementation of company-wide software applications,
procurement of IT hardware equipment, as well as the implementation of Highway Traffic
Management Systems (HTMS), Toll Management Systems (TMS), and Weigh-in- Motion systems for
major highway projects undertaken and operated by IRCON and its Joint Venture companies as
concessioners. IT serves not only as a service provider but also plays a vital role in
enhancing employee productivity within IRCON.
IRCON has recently upgraded to SAP S/4 Hana as Enterprise Resource
Planning (ERP) application software for the operations of Finance, Controlling and Human
Resource Management. It is leading to company wide information availability, transparency
and has enabled faster decision making. SAP Business Objects (SAP BO) an analytical
product of SAP was added to SAP implementation to automate on-demand financial reporting.
This reporting tool fetches real-time data from SAP and helps in preparation of Financial
Statements of the Company. Employee Self Service Portal, Finance and HCM modules of SAP
have been rolled out for entire organization and Project systems are under implementation
at various locations. The financial statements for the year ended March 31, 2024 were
prepared from SAP S4-HANA and salaries of employees are also being processed through its
payroll module from April 2022 onwards. Fully functional SAP S4-HANA after implementation
will cover end-to-end business processes of IRCON. S4-HANA ERP software's server
infrastructure is hosted on RailTel cloud on a MEITY empaneled Datacenters to ensure
secured access in high availability environment where in there is scope for capacity
augmentation without disruption of regular services.
E-Office system is deployed across IRCON for all domestic and foreign
projects. It is a step towards paperless office initiative from Government of India for
the approvals and movement of files, note sheets and other official documents. It is
complete replacement of physical file system with loss less and undeletable data facility,
and Digital Signature authentication features.
Implementation of S4-HANA as well as e-office will be in conjunction to
each other, and has helped IRCON to march ahead with near paperless requirement in the
entire organization.
Dedicated video conferencing facility based on the cutting edge AI
based online meeting is being widely used for conducting review meetings with project
offices, trainings, promotion interviews and contract management issues etc.
Cyber and Social Engineering attacks are a big concern now a days for
organizations information security. IRCON has made efforts in this area and has formulated
a Cyber Crisis Management Plan. Incidents of Cyber-attacks are reported to CERT-IN for
record and further guidance. Steps are being taken to ensure that proper Cyber security
audits of IT applications and IT infrastructure are done as per industry practice and
norms. Employee awareness programs/trainings are being conducted on regular basis.
For efficient and transparency eProcurement through GeM (Government
E-Market Place) and CPP Portal (Central Public Procurement Portal) have been adopted
organization wide. Online collaboration tools are used by employees for information
sharing and business communication.
CORPORATE GOVERNANCE
The Company places great emphasis on adhering to corporate governance
guidelines and best practices, recognizing their significance in enhancing long-term
shareholder value and upholding minority rights. It considers it a fundamental obligation
to provide timely and accurate information regarding the Company's operations,
performance, leadership, and governance.
In compliance with Regulation 34 of the LODR Regulations and DPE
Guidelines on Corporate Governance for Central Public Sector Enterprises issued in May
2010, the Corporate Governance Report, along with the compliance certificates of Corporate
Governance norms under the aforementioned LODR Regulations and DPE Guidelines, is attached
and constitutes an integral part of this report.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
As on March 31, 2024, the Company had nine directors of which four are
whole-time directors [Chairman & Managing Director, Director (Finance), Director
(Works) and Director (Projects)], one Government Nominee Director and four Independent
Directors.
The Company has requested the Ministry of Railways for appointment of
requisite number of Independent Directors in order to comply with the statutory
requirements. Pursuant to Section 203 of the Companies Act, 2013, the Board of Directors
had designated Chairman & Managing Director (CMD) as Chief Executive Officer (CEO) and
all the Whole-time Directors and Company Secretary as Key Managerial Personnel (KMP) of
the Company. The senior most finance official of the Company is designated as Chief
Financial Officer (CFO) and KMP.
Board Of Directors & Key Managerial Personnel (KMP) as on March 31,
2024
The Board of Directors of the Company as on March 31, 2024 were
Executive (Functional) Directors viz.- Shri Brijesh Kumar Gupta (DIN: 10092756), Chairman
& Managing Director & CEO, Smt. Ragini Advani, (DIN: 09575213), Director
(Finance), Shri Parag Verma, (DIN: 05272169) Director (Works), Shri Anand Kumar Singh
(DIN:07918656) Director (Projects); Part- time (Official) Director viz. Shri Dhananjaya
Singh (DIN: 08955500); being Government Nominee Director and Independent Directors viz.
Shri Ajay Kumar Chauhan (DIN: 09394953), Shri Dipendra Kumar Gupta (DIN: 09398271), Smt.
Ranjana Upadhyay (DIN: 07787711) (woman independent director) and Dr. Kartik Chandulal
Bhadra (DIN: 09453387).
In addition to the CEO and whole-time directors, other KMPs, as on
March 31, 2024 were Shri B Mugunthan, Executive Director (Finance) & CFO and Smt.
Pooja Gurwala, Company Secretary.
Appointments and cessation of the Directors and KMP during and after
close of the FY 2023-24
CHANGES IN THE POST OF CHAIRMAN & MANAGING DIRECTOR
Shri Brijesh Kumar Gupta (DIN:10092756), Additional Member (CE),
Railway Board and Government Nominee (Part-Time Official) Director, IRCON assumed the
additional charge of Chairman & Managing Director and CEO, IRCON in addition to his
own duties on April 29, 2023 until further orders of Ministry of Railways and was
regularised at the last Annual General Meeting of the Company held on 12th September 2023.
Further, pursuant to Order of the Ministry of Railways, Shri Brijesh Kumar Gupta
relinquished the additional charge of the post of Chairman & Managing Director and CEO
w.e.f. April 29, 2024 and re-designated as Government Nominee (Part Time Official)
Director of the Company, w.e.f. April 29, 2024.
Shri Ashish Bansal (DIN: 10328174), IRSE, PED/Tr. (M&MC), Railway
Board [DIN:10328174] has been entrusted with the additional charge of the post of Chairman
& Managing Director and CEO, IRCON in addition to his own duties w.e.f. April 29,
2024.
Further, Railway Board vide its order letter no. 2023/E(O) ll/40/15
dated 1st July, 2024, has appointed Shri Hari Mohan Gupta, (DIN: 08453476), to the post of
CMD, IRCON, from the date of his assumption of charge of the post and till the date of his
superannuation i.e. 30.06.2026 or until further orders, whichever is earliest. Shri Hari
Mohan Gupta has assumed the charge of the post of CMD and has been designated as CEO (Key
Managerial Personnel) of the Company w.e.f. 1st July, 2024 (AN). Accordingly, Shri Ashish
Bansal has relinquished the additional charge of the post of CMD and ceased to be Key
Managerial Personnel (CEO) of the Company w.e.f. 01.07.2024 (FN), pursuant to the
appointment of regular CMD. Shri Hari Mohan Gupta, CMD is proposed to be regularized as
CMD of the Company at the ensuing AGM of the Company. CHANGES IN THE POST OF FUNCTIONAL
DIRECTOR Shri Anand Kumar Singh (DIN: 07918656), appointed as an Additional
Director/Director (Projects) w.e.f. 7th July 2023, was regularized at the last Annual
General Meeting of the Company held on 12th September 2023.
CHANGE IN THE KMP
During the financial year 2023-24, Ms. Ritu Arora ceased to be Company
Secretary and Whole time Key Managerial Personnel of the Company w.e.f. 16.11.2023 and the
Board of Directors of the Company, w.e.f. 28.11.2023, had appointed Ms. Pooja Gurwala,
JGM/Company Affairs as Company Secretary and Key Managerial Personnel of the Company, till
such time a candidate is selected and appointed at a higher level. Also, Shri Ankit Jain,
Manager (Company Affairs), has been appointed as Compliance Officer of the Company under
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Later on, after closure of the financial year 202324, following the
Ircon's recruitment and selection procedure, Smt. Pratibha Aggarwal has been selected as
General Manager for the post of Company Secretary in IRCON and was appointed as Company
Secretary and Whole time Key Managerial Personnel of the Company w.e.f. 21.05.2024 vice
Smt. Pooja Gurwala.
The complete details of appointment / relinquishment of post by the
Directors and other related details are provided in the Corporate Governance report
forming part of Annual Report.
INDEPENDENT DIRECTORS' DECLARATION
The Company has received necessary declaration from all Independent
Directors that he/she meets the criteria of independence as laid out in Section 149(6) of
the Companies Act, 2013 and Regulations 16(1)(b) and 25(8) of the LODR Regulations. The
declarations have been noted by the Board of Directors.
The Ministry of Corporate Affairs (MCA) has issued notifications in
October 2019, relating to the creation and maintenance of the data bank for independent
directors by Indian Institute of Corporate Affairs at Manesar, Haryana (IICA). Under
Section 150(1) of the Companies Act, 2013, IICA conducts Online Proficiency
Self-Assessment for Independent Directors. Accordingly, all the Independent Directors of
the Company are registered with data bank of IICA.
APPOINTMENT / RE-APPOINTMENT OF DIRECTORS THROUGH POSTAL BALLOT
Pursuant to the provisions of Section 152(2) of the Companies Act,
2013, every director of the Company has to be appointed in the general meeting of the
Company. Further pursuant to LODR Regulations, every listed entity shall ensure that
approval of shareholders for appointment/re-appointment of a person on the Board of
Directors is taken at the next general meeting or within a time period of three months
from the date of appointment, whichever is earlier. However, CPSEs are allowed that the
approval of the shareholders for appointment or re-appointment of a person on the Board of
Directors or as a Manager is taken at the next general meeting.
RETIREMENT OF DIRECTORS BY ROTATION
In terms of Section 152 of the Companies Act, 2013, the provisions in
respect of retirement of Directors by rotation will not be applicable to the Independent
Directors. In view of this, all directors (other than the Independent Directors) are
considered for retirement by rotation. Accordingly, as per provisions of the Companies
Act, 2013, Shri Parag Verma, Director (Works) and Shri Dhananjaya Singh Government Nominee
Director, are liable for retirement by rotation at the ensuing Annual General Meeting
(AGM) of the Company and being eligible, offer themselves for re-appointment.
The details of such Directors seeking re-appointment / appointment at
the ensuing AGM are contained in the Notice convening ensuing AGM of the Company.
BOARD & COMMITTEE MEETINGS Board Meetings:
The Board met nine (9) times during the FY 2023-24, on April 6, 2023;
May 11, 2023; May 24, 2023; July 20, 2023; August 08, 2023; October 17, 2023; November 9,
2023; November 28, 2023; and February 08, 2024. The necessary quorum in terms of LODR
Regulations was present for all the meetings. The intervening gap between the meetings was
within the period prescribed under the Companies Act, 2013, DPE Guidelines and LODR
Regulations.
During the FY 2023-24, all the meetings of the Board were held at the
Company's Registered Office, in New Delhi, through physical and Video Conferencing mode.
Committee meetings:
Your Company's Board has the following committees:
1. Audit Committee
2. Nomination & Remuneration Committee
3. Stakeholders' Relationship Committee
4. Risk Management Committee
5. Corporate Social Responsibility & Sustainability Committee
6. Project Progress Review Committee During the FY 2023-24, the Audit
Committee of the Board met seven (7) times, the Nomination & Remuneration Committee
met six (6) times, Stakeholders' Relationship Committee met one (1) time; Risk Management
Committee of the Board met two (2) times; the Corporate Social Responsibility &
Sustainability Committee met three (3) times, and the Project Progress Review Committee
met one (1) time.
Details of constitution, terms of reference of the Committees, and
attendance of Directors at meetings of the Committees are provided in the Corporate
Governance Report forming part of Annual Report.
SEPARATE MEETING OF INDEPENDENT DIRECTORS
In compliance with the provisions of Regulation 25(3) of LODR
Regulations, Schedule IV of the Companies Act, 2013 and guidelines issued by DPE, one
separate meeting of Independent Directors was held on March 11, 2024 (which continued on
March 12, 2024) without the presence of other Board Members.
SELECTION OF NEW DIRECTORS AND BOARD MEMBERSHIP CRITERIA
IRCON being a Government Company, the appointment of directors on its
Board is made by the President of India through the Administrative Ministry, Ministry of
Railways. The key qualifications, skills, expertise and attributes of the Directors is
included in the Corporate Governance Report.
PERFORMANCE EVALUATION
IRCON is a Government Company that operates under the administrative
control of the Ministry of Railways. The appointment procedure for all directors is
prescribed by the Government of India, and the directors of the Company have been
appointed in accordance with this procedure. The selection of functional directors,
including the Chairman and Managing Director (CMD), follows the recommendations of the
Public Enterprises Selection Board (PESB) in line with the procedure and guidelines set by
the Government of India. The Department of Public Enterprises (DPE) has also established a
system and procedure for evaluating the performance of functional directors, including the
CMD.
The evaluation framework for assessing the performance of functional
directors encompasses several key areas:
a) The performance of the Company under the Memorandum of Understanding
(MOU) signed with the Ministry of Railways, including the achievement of targets set for
each respective director.
b) The evaluation process involves self-assessment by the functional
directors themselves, followed by an assessment by the CMD, and finally, a comprehensive
evaluation by the Ministry of Railways (the Administrative Ministry).
c) For the CMD, the evaluation includes self-assessment and a final
evaluation conducted by the Ministry of Railways.
Regarding Government Nominee Directors, their evaluation is carried out
by the Ministry of Railways in accordance with the prescribed procedure. Independent
Directors, who are also appointed by the Government of India, undergo evaluation by the
Ministry of Railways and, ultimately, by the DPE.
REMUNERATION POLICY FOR THE BOARD AND SENIOR MANAGEMENT
As a Government Company, IRCON follows the guidelines issued by the
Department of Public Enterprises (DPE) for determining the remuneration of its functional
directors, senior management officials, and other employees. The Company has placed the
salient features of its remuneration policy for key managerial personnel and employees on
its website (www.ircon.org) under the HRM and Career Sections, as required by Section
178(4) of the Companies Act, 2013.
The remuneration policy of the Company, as well as the procedures and
policies for the appointment of Senior Management, are reviewed and recommended by the
Nomination & Remuneration Committee before being approved by the Board of Directors.
Furthermore, under Section 197 of the Companies Act, 2013, and Rule 5
of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014,
listed companies are required to disclose specific details of directors' remuneration in
the Board's Report. However, Government Companies, including IRCON, are exempted from
complying with this provision as per Notification No. GSR 463(E) dated June 5, 2015,
issued by the Ministry of Corporate Affairs.
Therefore, such details are not included in the Board's Report of
IRCON. However, the remuneration paid to directors during FY 2023-24 is disclosed in the
Corporate Governance Report.
INTERNAL CONTROL SYSTEMS
The Company has implemented robust financial controls in accordance
with the provisions of the Companies Act, 2013. These internal financial controls over
financial reporting are functioning effectively. The controls are designed to ensure the
maintenance of accurate accounting records, promote the orderly conduct of business
operations in compliance with company policies, safeguard company assets, prevent and
detect fraud and errors, and ensure the reliability of financial and operational
information. The internal control system, which includes Internal Financial Controls over
Financial Reporting, undergoes periodic reviews, and necessary adjustments are made to
align with evolving business needs.
Further information about the internal control system can be found in
the Management Discussion and Analysis Report.
INTERNAL CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING
Your Company has adopted an ‘Internal code of conduct for
prevention of insider trading in dealing with securities of the Company' (Code of
Conduct), to regulate, monitor and report trading by designated persons and their
immediate relatives and code for practices and procedures for fair disclosure of
Unpublished Price Sensitive Information (UPSI) as per the requirement under SEBI
(Prohibition of Insider Trading) Regulations, 2015. The Code of Conduct aims that the
insiders of the Company shall not derive any benefit or assist others to derive any
benefit from the access to and possession of UPSI about the Company which is not in the
public domain and thus constitutes insider information.
The Code of Conduct as approved by the Board has been posted on the
website of the Company, i.e., www.ircon. org under the head Codes and Policies in the
Investors section.
RISK MANAGEMENT
The Company has an elaborate Enterprise Risk Management (ERM)
framework, including risk management policy for risk identification and its mitigation.
As per the LODR Regulations, the Company is having a Board level Risk
Management Committee, which as on March 31, 2024 comprised of Director (Works) as
Chairman, Director (Finance), Director (Projects), and Dr. Kartik Chandulal Bhadra,
Independent Director as members.
Details of the Risk Management System are provided in the Management
Discussion and Analysis Report and the Risk Management Committee are provided in the
Corporate Governance Report.
WHISTLE BLOWER POLICY / VIGIL MECHANISM AND VIGILANCE ACTIVITIES
Being a Government Company, the Company has a separate Vigilance
Department which deals with fraud or suspected fraud involving employees/representatives
of suppliers, contractors, consultants, service provider or any other party doing business
with the Company. Whistle Blower and Fraud Prevention and Detection Policies have been
approved by the Board of Directors and are available on the website of the Company. The
Company has in place the necessary vigil mechanism for employees and directors to report
to the Management concerns about unethical behavior, actual or suspected fraud, violation
of the Company's Code of Conduct or ethics policy and instances of a leak of unpublished
price sensitive information. If one raises a concern under this Policy, the complainant
will not be at risk of suffering any form of reprisal or retaliation (including
discrimination, reprisal, harassment or vengeance) in any manner. No person has been
denied access to the Chairman & Managing Director, IRCON or to Chairman of the Audit
Committee.
The Vigilance Department plays an advisory role to the top management
in matters pertaining to vigilance. It is headed by a full-time Chief Vigilance Officer
(CVO) appointed by the Appointments Committee of the Cabinet (ACC) in consultation with
Central Vigilance Commission (CVC).
The Department ensures implementation of laid down
guidelines/procedures through preventive checks of tenders and contracts, execution of
works, and other functions as well as carry out investigations into complaints. During FY
2023-24, the Department has carried out 01 surprise inspection and 05 periodic inspections
on high-value projects. Apart from surprise and periodic inspections department has
carried out 03 preventive inspections on tenders floated from the corporate office. Chief
Technical Examiner's Organisation (Technical wing of Central Vigilance Commission) has
also carried out extensive investigation of 01 Project. Complaints raised against
officials and procedures, etc., by various Authorities (such as CVC/Railway Board
Vigilance, CBI, Prime Minister's Office, etc.,) and received from other sources were
investigated to their logical conclusion.
During FY 2023-24, the Department has received a total of 22 nos.
complaints and total 20 nos. complaints were disposed off including that of previous
years. Nature of Complaints includes irregularities during tendering, execution of
contract, anonymous & pseudonymous and quality related issues. Also steps were taken
for closure of Paras raised by the Chief Technical Examiner's Organisation (CTEO). In
addition, scrutiny of immovable property returns of employees, creating awareness on
rules/procedures/common irregularities in execution through workshops, training, debate,
competitions, etc., have been the prime activities of the Department.
As a step towards ‘Leveraging of Technology' for better
transparency, online services are efficiently running since years viz, submission of
immovable Property Returns since 2012-13; online Vigilance Clearance since April 1, 2014
through the intranet portal; and fling of vigilance complaints since December
2012.Further, E-Procurement has already been started w.e.f July 1, 2013 in the
organisation in a comprehensive manner for achieving transparency for all value of the
work.
IRCON has adopted Integrity Pact (IP) as recommended by the Central
Vigilance Commission (CVC) on June 24, 2014, for tenders/contract for works and supply
with an estimated value of Rs 5 Crore and above on all Indian Projects. The Integrity Pact
is made a compulsory document in the conditions of model e-Procurement Documents for all
works. IRCON has implemented this Integrity Pact which is a tool developed by Transparency
International and it ensures that all activities and transactions between a Company or
Government Departments and their Suppliers are handled in a fair, transparent and
corruption-free manner.
As per the provision of Integrity Pact and relevant guidelines of
Central Vigilance Commission, Shri Bimal Julka, Retired IAS, has been appointed on
November 30, 2021 as an Independent External Monitor (IEM) as per revised SOP. Dr.
T.M.Bhasin, Ex. Central Vigilance Commissioner, has been appointed as an Independent
External Monitor (IEM) on November 18, 2020 as per earlier SOP till 17.11.2023 for 3 years
subsequent to which Shri Madhusudan Prasad has been appointed on 18.11.2023 as per revised
SOP dated 14.06.2023 (2nd IEM) and to receive any complaints from the bidders and submit
the investigation report.
Vigilance strives to achieve its objective of promoting an impartial,
fearless, and transparent environment in the functioning of the organization by taking
steps to prevent unethical practices.
RELATED PARTY TRANSACTIONS
Pursuant to the provisions of Section 177 and 188 of the Companies Act
2013 (the Act) and LODR Regulations, prior approval of the related party transactions
wherever applicable are taken from the Audit Committee / Board as applicable. Prior
omnibus approval of the Audit Committee is also obtained on yearly basis for various
Related Party Transactions between IRCON or any of its subsidiaries on one hand and a
related party of the IRCON or any of its subsidiaries on the other hand in the ordinary
course of business valuing not exceeding Rs 1 Crore for each contract / agreement /
transaction in a financial year. The transactions, if any, entered into pursuant to the
omnibus approval granted, are placed before the Audit Committee on a quarterly basis.
Approval of specific related party transactions other than those covered under the Omnibus
approval are also obtained from the Audit Committee/ Board in compliance with the
requirement of the Companies Act 2013 and LODR Regulations.
In pursuance to Section 134(3)(h) of the Companies Act, 2013 and Rule
8(2) of the Companies (Accounts) Rules, 2014, the "Disclosure of particulars of
contracts / arrangements entered by the Company with related parties including certain
arms-length transactions" are disclosed in Form AOC-2 and is annexed to this Report.
The Related Party Transaction Policy of the Company as approved by the
Board is uploaded on the Company's website under the ‘Investors' section at
www.ircon.org.
DIRECTORS' RESPONSIBILITY STATEMENT
The Board of Directors of the Company confirms:
i) that in the preparation of the financial statements, the applicable
accounting standards had been followed except as otherwise stated in the annual financial
statements and there has been no material departure;
ii) that such accounting policies were selected and applied
consistently and such judgments and estimates were made that are reasonable and prudent so
as to give a true and fair view of the state of affairs of the Company for the financial
year ended on March 31, 2024, and of the profit of the Company for the FY 2023-24;
iii) that proper and sufficient care has been taken for the maintenance
of adequate accounting records in accordance with the provisions of the Companies Act,
2013, for safeguarding the assets of the company and for preventing and detecting fraud
and other irregularities;
iv) that the financial statements have been prepared on a going concern
basis;
v) that internal financial controls were adequate and operating
effectively; and
vi) that proper system has been devised to ensure compliances with the
provisions of all applicable laws and that such systems were adequate and operating
effectively.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
The "Business Responsibility and Sustainability Report"
(BRSR) in compliance with the provisions of Regulation 34 of the LODR Regulations, in the
format prescribed under SEBI Circular July 12, 2023 forms part of the Report. The report
describes the initiatives taken by IRCON from an environmental, social and governance
perspective.
MOU RATING / AWARDS
In line with the Department of Public Enterprises (DPE) guidelines, the
Ministry of Railways and IRCON International Limited (IRCON) annually sign a Memorandum of
Understanding (MoU). This MoU specifies selected parameters and targets for the respective
financial year. The performance of IRCON is subsequently assessed at the year's end based
on the achievement of these targets.
For the financial year 2022-23, IRCON received an ‘Excellent'
rating based on its performance evaluation against the MoU parameters.
IRCON has been awarded several prestigious awards. Some of the
significant awards and accolades won during the year 2023-24 are mentioned below:
• CE&CR Annual award for "Outstanding Tunnel
Structure" for the project "Udhampur- Srinagar - Baramulla New BG Rail line -
Construction of Tunnel T-49 on Dharam - Qazigund Section".
• Governance Now 10th PSU Award - CSR Commitment
• Governance Now 10th PSU Award - Nation Building
• Dun & Bradstreet award - ESG Champions of India 2024 in the
Engineering & Construction services sector
• Excellence in Civil Engineering, Testing and Commissioning of
Rail Projects by Rail Analysis India
• Top Challenger 2022-23 award by Construction World
• Safety Innovation Award 2023 for implementing Innovative Safety
Management Systems. •
• IRCON has secured 238th rank in the list of Top 250
International Contractors and 229th rank in the list of Top 250 Global Contractors
published by ENR Survey 2023.
AUDITORS
STATUTORY AUDITORS
The Comptroller & Auditor General of India (C&AG) has appointed
M/s Ramesh C. Agrawal & Co., Chartered Accountants, New Delhi (Firm Registration
No.001770C) as the single Statutory Auditors of the Company, for FY 2023-24, except for
the following foreign projects for which C&AG has approved the appointment of the
following as statutory auditors:
BRANCH AUDITORS FOR INTERNATIONAL PROJECTS |
|
Mr. AIT MIMOUN Rafik |
Algeria Project |
M/s Jayasinghe & Co. |
Sri Lanka Project |
M/s Toha Khan Zaman & Co. |
Bangladesh Project |
My Asia Consulting Co. Ltd. |
Myanmar Project |
COST AUDITORS
In pursuant to the provisions of Section 148 of the Companies Act, 2013
and rules made thereunder, the Company has maintained the cost records of the Company. The
Board of Directors has appointed M/s R.M. Bansal & Co., Cost Accountants, (having firm
Registration No.000022) as Cost Auditor of the Company for the FY 2023-24 for conducting
the audit of cost records.
SECRETARIAL AUDITORS
In pursuant to the provisions of Section 204 of the Companies Act, 2013
and Regulation 24A of the LODR Regulations, the Board of Directors has appointed M/s VAP
& Associates, Company Secretaries in practice (Certificate of Practice No. 13901) as
the Secretarial Auditors for conducting Secretarial Audit of the Company for the FY
2023-24.
INTERNAL AUDITORS
The Board of Directors have appointed following Internal Auditors for
the Indian & Foreign Projects for the FY 2023-24:
Sl Region / Audit Circles No. |
Internal Auditors |
1. Corporate Office Region (including Foreign Project viz.
Algeria Project) |
M/s A.M.A.A. & Associates, Chartered Accountants |
2. Northern Region |
M/s A.M.A.A. & Associates, Chartered Accountants |
3. Eastern Region (including foreign projects viz. Myanmar
Road Project, Khulna Mongla Bangladesh, Ishrudi Darsana Bangladesh S&T, and Bhairab
Railway Bridge (JV) Project Bangladesh) |
M/s SEN & RAY, Chartered Accountants |
4. Mumbai Region (including Foreign Project viz. Upgradation
of Railway Line, Maho to Omanthai, Sri Lanka) |
M/s J. Singh & Associates, Chartered Accountants |
5. Patna Region |
M/s Gupta Sachdeva & Co., Chartered Accountants |
6. J & K Region |
M/s Baweja & Kaul, Chartered Accountants |
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
IRCON is engaged in the business of providing infrastructure facilities
and is exempted from compliance with all the provisions of Section 186 [except sub-section
(1) to Section 186] in terms of Section 186(11)(a) read with Schedule VI of the Companies
Act, 2013.
The details of investments made, loans granted, and guarantees extended
by the Company to its subsidiary and joint venture companies during the FY 2023-24 forms
part of the notes to the standalone financial statements provided in the Annual Report.
DEPOSITS
The Company did not accept any deposits from the public during the
financial year.
OTHER DISCLOSURES Extract of Annual Return
Pursuant to Section 92(3) and 134(3)(a) of the Companies Act, 2013, the
Annual Return of the Company as at March 31, 2024 is placed on the website of the Company
at www. ircon.org, under the Investors section.
INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
The Company has complied with the provisions relating to the Investor
Education and Protection Fund (IEPF) under the Companies Act, 2013 and the rules made
thereunder. Company Secretary is the nodal officer to deal with the IEPF Authorities and
compliances related thereto.
No amount is due for transfer to IEPF and details of unclaimed dividend
as on March 31, 2024 are available on the website of the Company, and this is also
disclosed in the Corporate Governance report. Further, the Company does not have shares in
Demat Suspense Account/ Unclaimed Suspense Account/ Unclaimed Dividend Account and the
same has been disclosed in the Corporate Governance report.
SECRETARIAL STANDARDS
During the financial year, the Company is in compliance with the
applicable Secretarial Standards issued by the Institute of Company Secretaries of India
(ICSI).
SIGNIFICANT MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR
TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
No order has been passed by the Regulators or Courts or Tribunals
impacting the going concern status of the Company and its operations in future during the
FY 2023-24.
DETAILS OF APPLICATION MADE OR ANY PROCEEDINGS PENDING UNDER THE
INSOLVENCY AND BANKRUPTCY CODE, 2016 DURING THE YEAR ALONG WITH THEIR STATUS AS AT THE END
OF THE FINANCIAL YEAR.
There are no proceedings initiated/pending against your Company under
the Insolvency and Bankruptcy Code, 2016 which will have material impact on the business
of the Company.
CHANGE IN THE NATURE OF BUSINESS
There was no material change in the nature of business of the Company
during the FY 2023-24.
DIVIDEND DISTRIBUTION POLICY
In terms of Regulation 43A of LODR Regulations and the guidelines on
"Capital Restructuring of Central Public Sector Enterprises" issued by the
DIPAM, the Board of Directors of the Company has formulated and adopted the Dividend
Distribution Policy. The Policy is hosted on the Website of the Company at
https://ircon.org/ images/file/cosecy/Dividend%20Distribution%20Policy. pdf.
SECRETARIAL AUDIT REPORT AND MANAGEMENT RESPONSE THERETO
The "Secretarial Audit Report" from the secretarial auditor
in Form MR-3 as required under Section 204 of the Companies Act, 2013 read with rule 9 of
the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms
part of this report.
The Management Response on the qualification in the Secretarial Auditor
Report and compliance of conditions of Corporate Governance for the FY 2023-24 forms part
of this report.
STATUTORY AUDITORS' REPORT AND C&AG COMMENTS
The reports of the Statutory Auditors on the Financial Statements for
FY 2023-24 (both on standalone and consolidated financial statements) are attached
separately as part of the Annual Report. There are no qualifications, reservations or
adverse remarks made by M/s Ramesh C. Agrawal, Chartered Accountant, Statutory Auditors,
in their report for the financial year ended on March 31, 2024.
C&AG has given NIL comments on the Audited Financial Statements of
your Company for the FY 2023-24 and the same are attached.
ACKNOWLEDGEMENT
The Directors of the Company would like to extend their heartfelt
gratitude and acknowledgement for the invaluable assistance and cooperation received from
various Ministries such as Railways, Road Transport and Highways (MoRTH), External
Affairs, Finance, Commerce, Urban Development, as well as other ministries, departments,
and agencies. We are also grateful for the support received from the office of Comptroller
& Auditor General of India, Reserve Bank of India, Bankers, Statutory, Branch, Cost,
Secretarial & Internal Auditors, of the Company, Indian Embassies & Missions
abroad, Foreign Missions & Embassies in India, EXIM Bank, ECGC Limited, Protector of
Immigration, Passport Authority, and our esteemed clients both within India and overseas
as without their active support, the Company would not have achieved its milestones during
the year under review.
We would like to express our sincere appreciation to all the dedicated
employees of the Company at every level. Their unwavering efforts, dedication, sincerity
and commitment have significantly contributed to achieving the highest ever performance of
the Company.