SHRIRAM TRANSPORT Notes to Accounts

1. Terms/Rights attached to equity shares


The Company has only one class of equity shares having a par value of Rs. 10/- per share. Each holder of equity shares is entitled to one vote per share. The dividend is subject to the approval of the shareholders in the ensuing annual general meeting.


During the year ended March 31, 2017, the amount of per equity share dividend recognized as distributions to equity shareholders was Rs.10.00 (March 31, 2016 : Rs. 10.00). Out of the total dividend declared during the year ended March 31, 2017, amount of interim dividend paid was Rs. 4.00 per equity share (March 31, 2016: Rs. 4.00) and amount of final dividend proposed was Rs. 6.00 per equity share ( March 31, 2016: Rs. 6.00).


In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.


2. Shares reserved for issue under options


During the year ended March 31, 2017 Nil (March 31, 2016: Nil) equity shares were vested and exercised.


3. Aggregate number of equity shares issued for consideration other than cash during the period of five years immediately preceding the reporting date:


The Company has issued total 582,168 equity shares (March 31, 2016 : 722,068) during the period of five years immediately preceding the reporting date on exercise of options granted under the employee stock option plan (ESOP) wherein part consideration was received in form of employee service and includes 500,868 (March 31, 2016 : 500,868) equity shares issued on account of merger of Shriram Holdings (Madras) Private Limited.


Nature of security


Secured by equitable mortgage of immovable property. Further secured by charge on plant and machinery, furniture and other fixed assets of the Company, charge on Company’s hypothecation loans, other loans, advances and investments of the Company subject to prior charges created or to be created in favour of the Company’s bankers, financial institutions and others.


Debentures may be bought back subject to applicable statutory and/or regulatory requirements, upon the terms and conditions as may be decided by the Company.


* Amount pertains to debentures issued prior to notification of the RBI Circular DNBD(PD) CC No. 330/03.10.001/2012-13 dated June 27, 2013.


4. Privately placed redeemable non-convertible debenture of Rs. 3,000,000/- each Terms of repayment as on March 31, 2017


Long-term borrowing (gross of unamortized discount on debenture of Rs. Nil.)


Outstanding as at March 31, 2017 : Rs. Nil.


Current maturity (gross of unamortized discount on debenture of Rs. Nil.)


segment information


The Company operates in a single reportable segment that is financing, which has similar risks and returns for the purpose of AS-17 on ‘Segment Reporting’ notified under the Companies (Accounting Standard) Rules, 2014 and the Companies (Accounting Standards) Amendment Rules, 2016. The Company operates in a single geographical segment i.e. domestic.


LEASES In case of assets taken on lease


The Company has taken various office premises, furniture and fixtures, computers and plant and machinery under operating lease. The lease payments recognized in the Statement of Profit and Loss are Rs. 9,195.17 lacs (March 31, 2016: Rs. 8,683.95 lacs). Certain agreements provide for cancellation by either party or certain agreements contains clause for escalation and renewal of agreements. The non-cancellable operating lease agreements are ranging for a period 11 to 180 months. There are no restrictions imposed by lease arrangements.


The future minimum lease payments in respect of non-cancellable operating lease as at the Balance Sheet date are summarized below :


5. In accordance with the Master Direction - Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 2016 dated August 25, 2016, the Company has created a floating charge on the statutory liquid assets comprising of investment in government securities to the extent of Rs. 140,376.00 lacs (March 31, 2016: Rs. 116,276.00 lacs) in favour of trustees representing the public deposit holders of the Company.


In addition to the auditors remuneration shown in operating and other expenses, the Company has also incurred auditors remuneration in connection with audit and related statutory services to be performed by auditors in connection with issue of senior secured notes of Rs. 126.37 lacs (March 31, 2016: Rs. Nil) [including out-of-pocket expenses of Rs. 2.45 lacs (March 31, 2016 : Rs. Nil)] shown under professional charges-resource mobilization in note 19.


6. DETAILS OF Net ASSETS Taken OVER On amalgamation


Pursuant to the scheme of amalgamation (‘the Scheme’) of erstwhile Shriram Equipment Finance Company Limited (SEFCL) with the Company under Sections 391 to 394 of the Companies Act, 1956 sanctioned by Hon’ble High Court of Madras on March 31, 2016 entire business and all assets and liabilities of Shriram Equipment Finance Company Limited were transferred and vested in the Company effective from April 1, 2015. Accordingly the Scheme has been given effect to in these financial statements.


SEFCL was non-banking finance Company ‘NBFC’ engaged in business of equipment financing.


The amalgamation has been accounted for under the “Pooling of Interest” method as prescribed by the Accounting Standard 14 “Accounting for Amalgamations” notified under the Companies (Accounts) Rules, 2014. Accordingly, the accounting treatment has been given as under:-


7. The assets and liabilities as at April 1, 2015 were incorporated in the financial statement of the Company at its book value.


8. Debit balance in the Statement of Profit and Loss of SEFCL as at April 1, 2015 amounting to Rs. 3,503.89 lacs was adjusted in “Surplus in Statement of Profit and Loss”.


9. Credit balance in the Statutory Reserve pursuant to section 45-IC of the RBI Act, 1934 of SEFCL as at April 1, 2015 amounting to Rs. 4,655.65 lacs was adjusted in “Statutory Reserve pursuant to section 45-IC of the RBI Act, 1934”.


10. SEFCL being wholly owned subsidiary, the entire share capital i.e. 10,000,000 Equity Shares of Rs.10/- each fully paid and 25,000,000 0.01% Preference Share of Rs.100/- each in Shriram Equipment Finance Company Limited, held as investment by the Company stands cancelled.


11. Exchange Traded interest rate (IR) derivatives : Nil


12. Disclosures on risk exposure of derivatives Qualitative disclosures


The Company has a Board approved policy in dealing with derivative transactions. Derivative transaction consists of hedging of foreign exchange transactions, which includes interest rate and currency swaps, interest rate options and forwards. The Company undertakes derivative transactions for hedging on-balance sheet assets and liabilities. Such outstanding derivative transactions are accounted on accrual basis over the life of the underlying instrument. The Asset Liability Management Committee and Risk Management Committee closely monitors such transactions and reviews the risks involved.


In the ordinary course of business, loan borrowers of the Company have directly deposited cash as part of their loan repayments in the collection bank accounts of the Company with various banks, aggregating to Rs. 60,639.52 lacs during the period November 9, 2016 to December 30, 2016 the denomination wise details of which are currently not available with the Company and hence not included in the above table.


Explanation : For the purposes of this clause, the term ‘Specified Bank Notes’ shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407(E), dated the November 8, 2016.


13. PREVIOUS YEAR COMPARATIVES


Previous year’s figures have been regrouped/reclassified wherever necessary, to conform to current year’s classification.


CIN: U67190WB2003PTC096617. Trading in Commodities is done through our Group Company Dynamic Commodities Pvt. Ltd. The company is also engaged in Proprietory Trading apart from Client Business.
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Disclosure: We, Dynamic Equities Private Limited are also engaged in Proprietory Trading apart from Client Business. In case of any complaints/grievances, clients may write to us at compliance@dynamiclevels.com

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