DLF Ltd
Directors Reports
Dear Members,
The Board of Directors have pleasure in presenting their 57th
Annual Report on the business and operations of the Company, together with the audited
financial statements for the Financial Year (FY) ended 31 March 2022. Financial and
Operational Highlights
(Rs in crore)
| Particulars |
Consolidated |
Standalone |
|
2021-22 |
2020-21 |
2021-22 |
2020-21 |
| Total income |
6,138 |
5,945 |
4,657 |
4,479 |
| Total expenses |
4,749 |
5,009 |
2,747 |
3,056 |
| Profit before exceptional items, tax, share of profit in
associates and joint ventures |
1,389 |
936 |
1,910 |
1,423 |
| Exceptional items (net) |
(224) |
(96) |
(235) |
(45) |
| Profit before tax, share of profit in associates and joint
ventures |
1,165 |
840 |
1,675 |
1,378 |
| Less: Tax expense (Current tax including earlier years and
Deferred Tax) |
321 |
362 |
340 |
325 |
| Profit after tax before share of profit (net) in associates
and joint ventures |
844 |
478 |
1,335 |
1,053 |
| Share of Profit in associates and joint ventures (net) |
656 |
605 |
|
|
| Net Profit for the Year |
1,500 |
1,083 |
1,335 |
1,053 |
| Other Comprehensive Income |
13 |
3 |
0.13 |
1 |
| Total Comprehensive Income |
1,513 |
1,086 |
1,335 |
1,054 |
Financial Performance Review and Analysis
On a consolidated basis, your Company recorded a revenue (including
other income) of Rs 6,138 crore, 3% higher as compared to the previous year. EBITDA stood
at Rs 2,163 crore, reflecting growth of 11% from the previous year. EBITDA margins
witnessed an improvement of 200 bps due to a better product mix.
Total operating expenses (excluding finance costs, depreciation and
amortisation expense) were Rs 3,975 crore. Finance costs stood at Rs 625 crore, a
significant reduction of 27%, compared to the previous year.
Your Company recorded a total comprehensive income of Rs 1,513 crore
during the year as compared to Rs 1,086 crore in the previous year after accounting for
share of profit in DLF Cyber City Developers Limited (DCCDL) and other jointly controlled
entities/ associates.
Your Company generated surplus cash flow, leading to significant
reduction in net debt. The improvement in cash flow was primarily driven by strong
collections along with sales ramp up and effective cost control measures implemented by
the Company.
Impact of COVID-19
The second wave of COVID-19 pandemic led to loss of human life and
suffering worldwide. It presented an unprecedented challenge to public health, food
systems and the economy as a whole. The economic and social disruption caused by the
pandemic was devastating.
Due to the large number of infections in India, several State
Governments announced lockdowns in the first quarter of FY 2021-22 to prevent the spread
of COVID-19. This led to the curtailment of economic activity. Once lockdown restrictions
were eased, the economy started witnessing a strong recovery.
The health and safety of its employees and stakeholders remained the
top priority for the Company, with several initiatives to support employees and their
families during the pandemic.
DLF Cyber City Developers Limited
DCCDL reported a consolidated total income of Rs 4,533 crore as
compared to Rs 4,385 crore in the previous year, reflecting a 3% growth, primarily led by
growth in retail revenue. DCCDLs consolidated EBIDTA stood at Rs 3,488 crore in FY 2021-22
in comparison to '3,417 crore in FY 2020-21. Total comprehensive income stood at '1,002
crore compared to '913 crore in FY 2020-21, reflecting a growth of 10%. As on 31 March
2022, DCCDL and its subsidiaries, together had an operational portfolio of ~3.52 million
square meter (msm) [37.9 million square feet (msf)] and ~0.19 msm (2 msf) of assets housed
under DLF.
Review of Business
Development Business
Your Company witnessed a strong growth across all segments in the
residential business during the FY 2021-22. The growth was well supported by sustained
momentum, fundamental drivers like affordability and the desire to own a home. The Company
embarked on bringing new products across different segments and locations. With
introduction of new products, the Company recorded new sales bookings of Rs 7,273 crore as
compared to Rs 3,084 crore in the previous year, a remarkable increase by 136%. The total
area sold during the FY stood at ~0.54 msm (5.8 msf).
Your Company launched, 'ONE Midtown', a luxury group housing project in
the heart of the capital, during the second half of FY which received overwhelming
response and Phase - I of the inventory was fully subscribed.
Your Company has identified a strong potential of ~3.25 msm (35 msf) of
new products offering diversity across segments and geographies. Out of this pipeline, DLF
has introduced Independent Floors across Gurugram, which saw extremely encouraging
response from the market, a luxury development in New Delhi and one plotted development in
Chennai. The Company continued to monetise its completed inventory and witnessed demand
pick-up across all segments. 'The Camellias', a super luxury development in Gurugram,
reported strong sales throughout the year. Your Company exhibited a strong double digit
pricing growth across the product offerings resulting in significant value enhancement.
Annuity Business
The rental business continued its steady path to recovery during the
year. The office business delivered strong collections, pick-up in leasing activity and
witnessed a gradual ramp up in return of occupiers to their workplaces. Consequently,
occupancy across the office portfolio improved to 88% at the end of the fiscal. The
development of next generation workspaces - DLF Downtown at Gurugram and Chennai and Data
Center at Noida remain on track.
The retail business exhibited strong rebound despite temporary
dislocations due to the pandemic. Footfalls are steadily reaching pre-pandemic level with
occupancy levels remaining strong at 97% across the retail portfolio. Given the backdrop
of strong rebound in this segment, your Company has initiated development plans to build
out new retail destinations across certain geographies including Gurugram, Delhi and Goa.
Dividend
The Board is pleased to recommend a dividend of Rs 3/- per equity share
(150%) (previous year Rs 2/- per equity share) of the face value of Rs 2/- each for the FY
2021-22, payable to those shareholders, whose names appear in the Register of Members/
Beneficial ownership list provided by the depositories on the record date.
The total outgo on account of payment of dividend for the FY 2021-22
would be Rs 742.59 crore (previous year Rs 495.06 crore).
The dividend payout is in accordance with the prevalent applicable laws
and the Company's Dividend Distribution Policy. The said policy is available on the
website of the Company i.e. https://www.dlf.in/pdf/
Dividend%20Distribution%20Policy.pdf.
Change in Capital Structure Authorised Share Capital
The Authorised Share Capital of the Company has been changed from
'10,00,00,00,000/- divided into 4,99,75,00,000 equity shares of '2/-each and 50,000
redeemable preference shares of Rs 100/- each to '10,02,98,50,000/- divided into
5,01,22,07,600 equity shares of Rs 2/- each and 54,348 redeemable preference shares of
'100/- each, pursuant to the order dated 2 February 2022, passed by the Hon'ble National
Company Law Tribunal, Chandigarh bench, approving
Scheme of Arrangement between DLF Phase-IV Commercial Developers
Limited, DLF Real Estate Builders Limited and DLF Residential Builders Limited (Transferor
Companies) and demerger and transfer/ vesting of real estate undertaking of DLF Utilities
Limited (Demerged Company) with DLF Limited (Transferee Company).
Paid-up Equity Share Capital
The paid-up equity share capital of the Company is Rs 495.06 crore
comprising 2,47,53,11,706 equity shares of '2/- each fully paid-up. There is no change in
the paid-up share capital of the Company during the FY.
Redemption of Debentures
During the FY, the Company has fully redeemed 5,000 Senior, Secured,
Rated, Listed, Redeemable Non-Convertible Debentures (NCDs) of the face value of Rs
10,00,000/- each, aggregating to Rs 500 crore with coupon rate of 9.5% p.a., one year
before the due date of redemption by exercising call option in terms of the issuance of
said NCDs.
Transfer to Reserves
During the FY, the Company has not transferred any amount to the
general reserve. In terms of the provisions of Section 71 of the Companies Act, 2013 ('the
Act') read with Rule 18(7)(b)(iii)(B) of the Companies (Share Capital and Debentures)
Rules, 2014, Debenture Redemption Reserve is not required to be created for privately
placed debentures issued by listed companies, hence no amount was transferred to Debenture
Redemption Reserve.
Credit Rating
During the FY, CRISIL has upgraded Long Term Rating on bank facilities
to AA-/Stable from A+/Stable and Short Term Rating to A1 + from A1.
Further, ICRA has upgraded Long Term Rating on bank borrowings/ NCDs to
AA-/Stable from A+/Stable and Short Term Rating to A1 + from A1.
Public Deposits
During the year under review, the Company has neither invited nor
accepted/ renewed any deposits from the public.
Holding Company
Rajdhani Investments & Agencies Private Limited continued to be the
holding company and holds 61.53% of paid-up equity share capital of the Company. The
shareholding of the holding company increased from 60.42% (FY 2020-21) to 61.53% (FY
2021-22), pursuant to Scheme of Amalgamation involving DLF Urva Real Estate Developers
& Services Private Limited (Transferor Company) with Rajdhani Investments &
Agencies Private Limited (Transferee Company), approved by the Hon'ble National Company
Law Tribunal, Ahmedabad Bench vide its Order dated 8 October 2021.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings and Outgo
The information on conservation of energy, technology absorption,
foreign exchange earnings and outgo as stipulated under Section 134(3)(m) of the Act read
with Rule 8(3) of the Companies (Accounts) Rules, 2014, as amended, is given at Annexure-A
hereto and forms part of this Report.
Particulars of Employees
Pursuant to the provisions of Section 197(12) of the Act read with Rule
5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, as amended, a statement listing names of the top 10 employees in terms of the
remuneration drawn and other particulars of the employees drawing remuneration in excess
of the limits set-out in the said Rules, forms part of this report at Annexure-E1 and
E2.
Subsidiaries, Joint Ventures, Associate Companies and Consolidated
Financial Statements
As on 31 March 2022, the Company had 180 subsidiary companies in terms
of the provisions of the Act. Further, details of changes in subsidiaries, joint ventures
and associate companies during the year are given at Annexure-D.
Pursuant to the provisions of Section 129(3) of the Act and the
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015, as amended ('SEBI Listing Regulations'), the Consolidated Financial
Statements of the Company were prepared in accordance with the applicable Ind AS and form
part of the Annual Report. A statement containing the salient features of the financial
statements of the Subsidiaries, Joint Ventures and Associates of the Company in Form
AOC-1, as required under the Companies (Accounts) Rules, 2014, as amended, also forms part
of the Notes to the financial statements. The highlights of the performance of
Subsidiaries, Joint Ventures and Associates and their contribution to the overall
performance of the Company are included as part of this Annual Report.
Pursuant to the provisions of Section 136 of the Act, Audited Financial
Statements of the Company, including Consolidated Financial Statements, other documents
required to be attached thereto and Audited Financial Statements of each of the
subsidiaries, are available on the website of the Company and may be accessed at https://www.dlf.in/investor.php.
Material Unlisted Subsidiary(ies)
In terms of the provisions of the SEBI Listing Regulations, your
Company has a policy for determining 'Material Subsidiary' and the said policy is
available on the Company's website at https://www.
dlf.in/pdf/DLF-Material-Subsidiary-Policy.pdf.
Your Company has four material unlisted subsidiaries namely, DLF Cyber
City Developers Limited (Debt Listed), DLF Assets Limited, DLF Power & Services
Limited and DLF Home Developers Limited.
Amalgamation/ Arrangement
A. Scheme of Amalgamation/ Arrangement sanctioned during the FY by the
Hon'ble National Company Law Tribunal, Chandigarh Bench (NCLT, Chandigarh)
1. DLF Phase-IV Commercial Developers Limited, DLF Real Estate Builders
Limited and DLF Residential Builders Limited (Transferor Companies) and demerger and
transfer/ vesting of real estate undertaking of DLF Utilities Limited (Demerged Company)
with DLF Limited (Transferee Company) vide Order dated 2 February 2022 and the Transferor
Companies stands merged with the Transferee Company w.e.f. the Appointed date of 1 April
2021.
2. Richmond Park Property Management Services Limited (Transferor
Company) with DLF Emporio Limited (Transferee Company) vide Order dated 2 March 2022 and
the Transferor Company stands merged with the Transferee Company w.e.f. the Appointed date
of 1 April 2019.
B. Merger(s) filed/ pending before the Hon'ble National Company Law
Tribunal, Chandigarh Bench (NCLT, Chandigarh)
1. Abhigyan Builders & Developers Private Limited, Abhiraj Real
Estate Private Limited, Benedict Estates Developers Private Limited, Chakradharee Estates
Developers Private Limited, DLF Gayatri Home Developers Private Limited, Lizebeth Builders
& Developers Private Limited, Vkarma Capital Investment Management Company Private
Limited and Vkarma Capital Trustee Company Private Limited (Transferor Companies) with DLF
Residential Partners Limited (Transferee Company) with the Appointed date of 1 October
2019.
2. Adeline Builders & Developers Private Limited, Armand Builders
& Constructions Private Limited, Americus Real Estate Private Limited, DLF Commercial
Developers Limited, Elvira Builders & Constructions Private Limited, Eastern India
Powertech Limited, Lada Estates Private Limited, Lear Builders & Developers Private
Limited, Melosa Builders & Developers Private Limited, Mens Buildcon Private Limited,
Narooma Builders & Developers Private Limited, Nudhar Builders & Developers
Private Limited, Rachelle Builders & Constructions Private Limited, Royalton Builders
& Developers Private Limited and Saket Holidays Resorts Private Limited
(Transferor Companies) with DLF Home Developers Limited (Transferee
Company) with the Appointed date of 1 October 2019.
3. Bellanca Builders & Developers Private Limited, Garv Promoters
Private Limited and Lempo Buildwell Private Limited (Transferor Companies) with Naja
Estates Developers Private Limited (Transferee Company) with the Appointed date of 1 April
2021.
4. Pyrite Builders & Constructions Private Limited and Webcity
Builders & Developers Private Limited (Transferor Companies) with Nadish Real Estate
Private Limited (Transferee Company) with the Appointed date of 1 April 2021.
5. Faye Builders & Constructions Private Limited and Garv Realtors
Private Limited (Transferor Companies) with Garv Developers Private Limited (Transferee
Company) with the Appointed date of 1 April 2021.
6. Dome Builders & Developers Private Limited and Qabil Builders
& Constructions Private Limited (Transferor Companies) with Skyrise Home Developers
Private Limited (Transferee Company) with the Appointed date of 1 April 2021.
7. Ariadne Builders & Developers Private Limited, Dae Real Estates
Private Limited, Liber Buildwell Private Limited, Mariabella Builders & Developers
Private Limited, Phoena Builders & Developers Private Limited and Vibodh Developers
Private Limited (Transferor Companies) with Raeks Estates Developers Private Limited
(Transferee Company) with the Appointed date of 1 April 2021.
8. Pariksha Builders & Developers Private Limited (Transferor
Company) with Unicorn Real Estate Developers Private Limited (Transferee Company) with the
Appointed date of 1 April 2021.
9. Adsila Builders & Developers Private Limited, Alana Builders
& Developers Private Limited, Beyla Builders & Developers Private Limited, Hansel
Builders & Developers Private Limited and Seamless Constructions Private Limited
(Transferor Companies) with Milda Buildwell Private Limited (Transferee Company) with the
Appointed date of 1 April 2021.
10. Gavel Builders & Constructions Private Limited, Jesen Builders
& Developers Private Limited, Jingle Builders & Developers Private Limited, Keyna
Builders & Constructions Private Limited, Morgan Builders & Developers Private
Limited, Morina Builders & Developers Private Limited and Morven Builders &
Developers Private Limited (Transferor Companies) with DLF Homes Panchkula Private Limited
(Transferee Company) with the Appointed date of 1 April 2021.
C. Scheme of Amalgamation sanctioned during the FY by the
Hon'ble Regional Director, Northern Region, Ministry of Corporate Affairs, New
Delhi (Central Government) with the Appointed Date of 1 April 2020
1. Laxmibanta Estates Developers Private Limited (Transferor Company)
with Sagardutt Builders & Developers Private Limited (Transferee Company) and the
Transferor Company stands merged with the Transferee Company vide Order dated 7 September
2021.
2. Cirila Builders and Constructions Private Limited (Transferor
Company) with Verano Builders & Developers Private Limited (Transferee Company) and
the Transferor Company stands merged with the Transferee Company vide Order dated 7
September 2021.
3. Kambod Real Estates Private Limited and Shikhi Estates Private
Limited (Transferor Companies) with Qabil Builders & Developers Private Limited
(Transferee Company) and the Transferor Companies stands merged with the Transferee
Company vide Order dated 7 September 2021.
4. Fabrizio Real Estates Private Limited and Karena Estates Developers
Private Limited (Transferor Companies) with Vamil Builders & Developers Private
Limited (Transferee Company) and the Transferor Companies stands merged with the
Transferee Company vide Order dated 8 September 2021.
5. Rajika Estate Developers Private Limited (Transferor Company) with
Uncial Builders & Constructions Private Limited (Transferee Company) and the
Transferor Company stands merged with the Transferee Company vide Order dated 9 September
2021.
6. Arva Builders & Developers Private Limited, Balint Real Estates
Private Limited, Havard Builders & Developers Private Limited and Mujaddid Builders
& Developers Private Limited (Transferor Companies) with Akina Builders &
Developers Private Limited (Transferee Company) and the Transferor Companies stands merged
with the Transferee Company vide Order dated 14 September 2021.
7. Abheek Real Estate Private Limited, Anuroop Builders &
Developers Private Limited, Charon Elevators Private Limited, Grism Builders &
Developers Private Limited, Luvkush Builders Private Limited, Peace Buildcon Private
Limited and Vismay Builders & Developers
Private Limited (Transferor Companies) with Ananti Builders &
Construction Private Limited (Transferee Company) and the Transferor Companies stands
merged with the Transferee Company vide Order dated 22 September 2021.
8. Abjayoni Estates Developers Private Limited, Camden Builders &
Developers Private Limited, Nilima Real Estate Developers Private Limited and Rosalind
Builders & Constructions Private Limited (Transferor Companies) with Atherol Builders
& Developers Private Limited (Transferee Company) and the Transferor Companies stands
merged with the Transferee Company vide Order dated 27 September 2021.
9. Alfonso Builders & Developers Private Limited and Rinji Estates
Developers Private Limited (Transferor Companies) with Hoshi Builders & Developers
Private Limited (Transferee Company) and the Transferor Companies stands merged with the
Transferee Company vide Order dated 27 September 2021.
10. Chrysilla Builders & Developers Private Limited (Transferor
Company) with Arlie Builders & Developers Private Limited (Transferee Company) and the
Transferor Company stands merged with the Transferee Company vide Order dated 27 September
2021.
D. Merger filed/ pending before the Hon'ble Regional Director, Northern
Region, Ministry of Corporate Affairs, New Delhi (Central Government) with the Appointed
Date of 1 April 2021
DLF Aspinwal Hotels Private Limited and DLF Cochin Hotels Private
Limited (Transferor Companies) with Lodhi Property Company Limited (Transferee Company).
Listing at Stock Exchanges
The equity shares of your Company are listed on National Stock Exchange
of India Limited (NSE) and BSE Limited (BSE). The Non-convertible Debentures issued by
your Company are also listed on the Wholesale Debt Market (WDM) segment of BSE.
Management Discussion and Analysis Report
The Management Discussion and Analysis Report, as required under
Regulation 34 read with Schedule V to the SEBI Listing Regulations, forms part of the
Annual Report.
Corporate Governance Report
The Company is committed to sound corporate governance practices as
well as compliance with all applicable laws and regulations. The Board believes that
combining the highest level of ethical principles with our unmatched brand, experience and
expertise, will ensure that DLF will continue to be the leading Company in the real estate
sector. The Corporate Governance Report, as stipulated under Regulations 17 to 27 &
46(2) and Paragraphs C, D and E of Schedule V to the SEBI Listing Regulations, forms part
of the Annual Report.
The requisite certificate from S.R. Batliboi & Co. LLP, Chartered
Accountants, Statutory Auditors of the Company, confirming compliance with the conditions
of corporate governance as stipulated under the SEBI Listing Regulations, is attached to
the Corporate Governance Report.
Directors' Responsibility Statement
In terms of the provisions of Section 134(5) of the Act, your Directors
confirm that:
(i) in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation relating to material
departures;
(ii) they have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as at 31 March 2022 and
the profit of the Company for that period;
(iii) they have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of this Act for safeguarding
the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) they have prepared the annual accounts on a going concern basis;
(v) they have laid down internal financial controls to be followed by
the Company and that such internal financial controls are adequate and are operating
effectively; and
(vi) they have devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems are adequate and operating
effectively.
Declaration by Independent Directors
The Independent Directors in their disclosures have confirmed that they
are not aware of any circumstances or situation which exists or may be reasonably
anticipated that could impair or impact their ability to discharge their duties. Based on
the disclosures received from Independent Directors, the Board of Directors has confirmed
that they fulfilled conditions specified in Section 149(6) of the Act and Regulation 16(1
)(b) of the SEBI Listing Regulations and were independent of the Management.
Confirmation by Directors regarding Directorship/ Committee Positions
Based on the disclosures received, none of the Directors on the Board
holds directorships in more than ten public companies and none of the Independent
Directors served as an Independent Director in more than seven listed entities as on 31
March 2022. Further, no Whole-time Director served as an Independent Director in any other
listed company. Necessary disclosures regarding Committee positions in other public
companies as on 31 March 2022 have been made by the Directors and have been reported in
the Corporate Governance Report and forms part of the Annual Report.
Certification from Company Secretary in Practice
A certificate has been received from AS & Associates, Company
Secretaries in practice that none of the Directors on the Board of the Company had been
debarred or disqualified from being appointed or continuing as Directors of companies by
SEBI, Ministry of Corporate Affairs or any such other Statutory/ Regulatory authority.
Board and its Committees
The Board of Directors met four times during the FY 2021-22. The
details on the composition of the Board, Committees, meetings held and related attendance
are provided in the Corporate Governance Report and forms part of the Annual Report.
Auditors and Audit Reports
S.R. Batliboi & Co. LLP, Chartered Accountants (FRN: 301003E/
E300005) were appointed as Statutory Auditors of the Company for a term of five
consecutive years from the conclusion of 52nd Annual General Meeting (AGM) till
the conclusion of 57th AGM.
The Board of Directors of the Company at its meeting held on 17 May
2022, on the recommendations of the Audit Committee, have recommended for re-appointment
of S.R. Batliboi & Co. LLP, Chartered Accountants (FRN: 301003E/E300005) as the
Statutory Auditors of the Company, subject to approval of the members, for the second term
of five consecutive years i.e. from the conclusion of 57th AGM till the
conclusion of 62nd AGM of the Company and the same is included in the notice
convening the AGM. The Company has received their written consent along with a certificate
that they satisfy the criteria provided under Section 141 of the Act and that the
appointment, if made, shall be in accordance with the applicable provisions of the Act and
rules framed thereunder.
The Notes on financial statements (including the Consolidated Financial
Statements) referred to in the Auditors Report are self-explanatory and do not call for
any further comments. The Auditors' Report does not contain any qualification,
reservation, adverse remarks or disclaimer.
Cost Auditors
During the year, M/s R.J. Goel & Co., Cost Accountants (FRN:
000026) were appointed as Cost Auditors of the Company for the FY 2021-22 for conducting
the audit of cost records of the Company pertaining to real estate development activities.
Your Company is maintaining the requisite cost records and the Cost Audit Report for the
FY 2021-22 which shall be filed with the Ministry of Corporate Affairs in due course.
A certificate from the Cost Auditors, certifying their independence and
arm's length relationship has been received by the Company.
As per provisions of the Act, the remuneration payable to Cost Auditors
is required to be approved by the members in a General Meeting. Accordingly, a resolution
seeking members' ratification for the remuneration payable to M/s R.J. Goel & Co.,
Cost Accountants is included in the notice convening the AGM.
Secretarial Auditor
Dr. K.R. Chandratre, Company Secretary in practice was appointed as
Secretarial Auditor of the Company to conduct Secretarial Audit for the FY 2021-22. The
Secretarial Audit Report and Secretarial Compliance Report for the FY ended 31 March 2022
is annexed herewith at Annexure-B. The Secretarial Audit Report does not contain
any qualification, reservation, adverse remarks or disclaimers. The Secretarial Compliance
Report has been filed with the stock exchanges.
DLF Cyber City Developers Limited, DLF Assets Limited, DLF Power &
Services Limited and DLF Home Developers Limited, material subsidiaries of the Company,
have also undergone Secretarial Audit under Section 204 of the Act and Regulation 24A of
the SEBI Listing Regulations.
Accordingly, the Secretarial Audit Reports for the FY ended 31 March
2022 of DLF Cyber City Developers Limited, DLF Assets Limited, DLF Power & Services
Limited and DLF Home Developers Limited, issued by Dr. K.R. Chandratre, Practicing Company
Secretary are at Annexure-B. The said reports are self-explanatory and do not
contain any qualifications, reservations, adverse remarks or disclaimers.
Reporting of Fraud by Statutory Auditors
During the year under review, the Statutory Auditors have not reported
any instance of fraud in respect of the Company, its officers or employees under Section
143(12) of the Act.
Secretarial Standards
The Secretarial Standards i.e. SS-1 & SS-2 relating to meetings of
the Board of Directors and General Meetings, respectively have been duly followed by the
Company.
Directors and Key Managerial Personnel
During the FY 2021-22, Mr. Ashok Kumar Tyagi and Mr. Devinder Singh,
Whole-time Directors, on the recommendations of the Nomination and Remuneration Committee,
were redesignated/ appointed by the Board of Directors as Chief Executive Officer and
Whole-time Directors w.e.f. 11 June 2021 for a term co-terminus with their appointment as
Whole-time Directors and their appointment was approved by the members of the Company at
the AGM held on 31 August 2021.
During the period under review, the Board of Directors of the Company
based on the recommendations of Nomination and Remuneration Committee has appointed Ms.
Savitri Devi Singh and Ms. Anushka Singh as Additional Directors of the Company w.e.f. 11
June 2021. Further, the members of the Company at the AGM held on 31 August 2021 appointed
Ms. Savitri Devi Singh and Ms. Anushka Singh, as Non-executive Directors of the Company,
liable to retire by rotation.
Pursuant to the provisions of Section 152 of the Act read with Articles
of Association of the Company, Ms. Pia Singh, Non-executive Director who was liable to
retire by rotation was re-appointed by the members vide ordinary resolution at the AGM
held on 31 August 2021.
Pursuant to the provisions of Section 152 of the Act read with Articles
of Association of the Company, Mr. Devinder Singh, Chief Executive Officer and Whole-time
Director and Mr. Gurvirendra Singh Talwar, Non-executive Director are liable to retire by
rotation at the ensuing AGM and being eligible, have offered themselves for
re-appointment. The resolution seeking members approval for their re-appointment forms
part of the AGM Notice. The Board of Directors of your Company has recommended their
re-appointment.
Lt. Gen. Aditya Singh (Retd.) would be attaining the age of 75 (seventy
five) years during the FY 2022-23 and in accordance with the provisions of the Regulation
17(1 A) of the SEBI Listing Regulations, the Board considering his knowledge, acumen,
expertise, experience, valuable contribution to the deliberations of the meetings of the
Board/ Committees and based on recommendations of the Nomination and Remuneration
Committee, has recommended his continuation as the Independent Director of the Company,
subject to the members approval, which forms part of the AGM Notice.
A brief resume of the Director(s) seeking re-appointment, along with
other details as stipulated under Regulation 36(3) of the SEBI Listing Regulations read
with the Secretarial Standards on General Meetings, is provided in the Corporate
Governance Report and Notice convening the AGM.
Pursuant to the provisions of Section 203 of the Act, the Key
Managerial Personnel of the Company are Mr. Rajiv Singh, Chairman (Whole-time Director),
Mr. Ashok Kumar Tyagi, Mr. Devinder Singh, Chief Executive Officer and Whole-time
Directors,
Mr. Vivek Anand, Group Chief Financial Officer and Mr. R.P Punjani,
Company Secretary & Compliance Officer of the Company.
Corporate Social Responsibility (CSR)
The DLF Group implements its CSR initiatives primarily through DLF
Foundation, which plays an indispensable role along with the Government, civil society and
communities to resolve critical development challenges faced by the communities. Its
programmes are aligned with the immediate ongoing priorities of the Government on CSR.
DLF believes that it needs to empower communities across various
domains through an integrated and holistic approach so that they are able to realise their
full potential as also, make a difference to the society. The Company believes in creating
value for the stakeholders, including the underprivileged sections of the society and that
everyone should be able to lead a life with dignity.
The Company has been contributing continuously towards building
sustainable capacities and creating resources for the marginalised people near its
operational areas.
DLF Foundation addresses Social Development Projects with an integrated
holistic approach to ensure that its programmes impact critical aspects of the lives of
the underserved in the areas of Education, Healthcare, Environment Preservation and
Promotion of Sports, as also for Animal Welfare.
The Board, based on the recommendations of the CSR Committee, approved
the CSR Policy of the Company in accordance with Section 135 of the Act and Rules made
thereunder. During the FY, Company has updated CSR Policy in line with the Act as amended.
A copy of the CSR policy is available on the Company's website at https://www.dlf.in/pdf/Corporate-Social-Responsibility-Policy.pdf
and CSR Annual Action Plan is at https://www.dlf.in/pdf/CSR-Annual-Action-Plan.pdf.
The Annual Report on CSR activities, as per the prescribed format under
the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, is annexed
at Annexure - C.
Environment and Sustainability
DLF recognises its unique position as industry pioneers to re-write the
Indian Real Estate narrative. It thus takes pride in enacting, exemplifying and exceeding
the highest environmental, social and governance standards and thus, addresses the
pressing challenges faced by our Nation.
Currently, world economy is in the midst of COVID-19 pandemic, reeling
under the impacts of rising inflation, bottlenecks in supply chains and effects of climate
change. Thus 'business as usual' is not an option. Consequently, building a resilient and
sustainable value chain is the forefront business strategy, in order to provide an agile
response to the challenges at an economic, environmental and social level.
To realise this business vision, the Company strives to excel in the
three dimensions of ESG i.e. Environmental, Social and Governance. In order to do that, it
has mapped the issues relevant to its business and stakeholders. The endeavour is to
strive for operational excellence, while pursuing growth that is environmentally and
socially sustainable. Therefore, sustainability strategy is centred around three key
pillars: Sustainable Business, Environmental Stewardship and Social Stewardship.
Care for the environment is a core focus area as the Company continues
to contribute in shaping a better future, which is safe, inclusive and sustainable.
Furthermore, the Company has designed business processes that incorporate social
well-being in everything that it does. It is adopting innovative means to promote resource
efficiency, emission reduction, water conservation, waste minimisation and biodiversity
protection. It also positively engages with communities surrounding its operations,
helping to enrich their lives through CSR programmes and employment opportunities.
The Company is deeply committed to the health, well-being and
prosperity of its customers, partners, employees and all other stakeholders. It is
continuously innovating to create safer workplaces and intelligent energy-efficient
infrastructure. This is necessary to promote smarter cities and sustainable communities
across India as also, achieve long-term value for all its stakeholders.
While the Company focuses on expanding its footprints and increasing
its revenue, it also continues to assess and monitor the risks and opportunities. This
includes assessing the emerging trends and addressing environmental and social issues as
it moves forward. Therefore, the approach to sustainability includes monitoring growth in
alignment with its targets and commitments towards ESG.
The Company's efforts towards the environment and society are backed by
robust governance that supports its values of integrity, accountability and transparency.
DLF takes pride in the fact that it has striven to exceed legal compliance requirements
and ensured that policies and procedures supporting responsible business practices are
implemented in their true spirit.
The Company has maintained rigorous safety standards vetted by
world-class independent organisations like British Safety Council. Testimony of this is
that it is the only Group globally, conferred 17 'Sword of Honour' Awards by them, a
pinnacle of safety standards across the world. DLF Buildings have also been conferred with
'Five Star Certifications for Occupational Health and Safety' by British Safety Council.
As a recognition of your Company's policies on governance, social and
environmental initiatives, your
Company once again has been recognised as Index component in the Dow
Jones Sustainability Indices in the emerging markets category for the second consecutive
year. DLF is the only real estate Company from India to be included in this index.
Global Real Estate Sustainability Benchmark (GRESB), an international
organisation considered a Global standard for ESG benchmarking and reporting for real
estate, recognised DLF as Regional Sector Leader with highest ranking of 5 Star rating
under Development Category, for its developments across the office space.
Our Environment, Social and Governance Report is available at https://www.dlf.in/investor.php.
Annual Return
The Annual Return under Section 92(3) of the Act read with Companies
(Management and Administration) Rules, 2014, is available at https://www.dlf.in/annual_docket/
ANNUAL_RETURN_2021_2022.pdf.
Awards and Accolades
Your Company continues to lead its sector and has received several
awards. The details of the major awards and accolades received during the year are given
at Annexure-F.
Business Responsibility Report (BRR)
The BRR describes the initiatives taken by the Company from social,
environmental and governance perspectives. Details are given at Annexure-G.
Particulars of Loans, Guarantees, Securities and Investments
Particulars of loans, guarantees, securities and investments have been
disclosed in the notes to the Standalone Financial Statements.
Transactions with Related Parties
The Company has robust processes and procedures for identification and
monitoring related party(ies) and related party transactions.
The Board of Directors of the Company has revised the Policy for
Related Party Transactions in line with SEBI Listing Regulations, as amended, which
regulates the transactions between the Company and its related parties. The said policy is
available on the Company's website at https://www.dlf.in/pdf/Related%20Party%20Transaction%20Policy.pdf.
The Policy intends to ensure that proper reporting, approval and disclosure processes are
in place for all related party transactions.
During the year, none of the transactions with related parties came
under the purview of Section 188(1) of the Act. Accordingly, the disclosure of related
party transactions as required under Section 134(3)(h) of the Act in Form AOC-2 is not
applicable to the Company for FY 2021-22 and hence, does not form part of this report.
Nomination and Remuneration Policy
The Nomination and Remuneration Policy was devised in accordance with
Section 178 of the Act and the SEBI Listing Regulations, as amended. The Nomination and
Remuneration Policy of the Company is aimed at inculcating a performance-driven culture.
Through its comprehensive compensation programme, the Company endeavours to attract,
retain, develop and motivate a high-performance workforce. The said policy is available on
the Company's website at https://www.dlf.in/pdf/Nomination%20
and%20Remuneration%20Policy.pdf.
The Company pays remuneration to its Chief Executive Officers,
Whole-time Directors by way of salary, benefits, perquisites and allowances (fixed
component) and commission (variable component). Annual increments are approved by the
Board of Directors based on the recommendations of the Nomination and Remuneration
Committee.
Based on the recommendations of the Nomination and Remuneration
Committee, the Board of Directors decides the commission payable to the Chief Executive
Officers, Whole-time Directors and Non-executive Directors, out of the profits for the FY
within the ceiling as prescribed under the Act.
Annual Evaluation of the Board, its Committees and Individual Directors
The Nomination and Remuneration Committee has formulated criteria for
Board evaluation, its committees' functioning and individual Directors including
Independent Directors and also specified that such evaluation will be done by the
Nomination and Remuneration Committee and the Board, pursuant to the Act and the Rules
made thereunder read with the SEBI Listing Regulations, as amended.
DLF believes that it is the collective effectiveness of the Board that
impacts Company's performance, as a whole. The Board's performance is assessed against the
role and responsibilities as provided in the Act and the SEBI Listing Regulations. The
parameters for the Board's performance evaluation have been derived from the Board's core
role of trusteeship to protect and enhance shareholders' value as well as to fulfil
expectations of other stakeholders through strategic supervision of the Company.
Evaluation of functioning of Board Committees is based on discussions
amongst Committee members and shared by the respective Committee Chairperson with the
Board.
Individual Directors are evaluated in the context of the role played by
each Director as a member of the Board at its meetings, in assisting the Board in
realising its role of strategic supervision of the functioning of the Company in pursuit
of its purpose and goals. While the Board evaluated its performance as per the parameters
laid down by the Nomination and Remuneration Committee, the evaluation of Individual
Directors was carried out as per the laid down parameters, anonymously in order to ensure
objectivity. The Independent Directors of the Board also reviewed the performance of the
Non-Independent Directors and the Board, pursuant to Schedule IV to the Act and Regulation
25 of the SEBI Listing Regulations.
Internal Financial Control
The Company has a robust and well embedded system of internal controls.
This ensures that all assets are safeguarded and protected against loss from unauthorised
use or disposition and all transactions are authorised, recorded and reported correctly.
An extensive risk based programme of internal audit and management reviews provides
assurance on the effectiveness of internal financial controls, which are continuously
monitored through management reviews, self-assessment, functional experts as well as by
the Statutory/ Internal Auditors during the course of their audits.
The internal audit of development business was entrusted to Grant
Thornton Bharat LLP and of rental business to KPMG Assurance and Consulting Services LLP
The main thrust of internal audit was to test and review controls, appraisal of risks and
business processes, as also benchmarking controls with the best industry practices.
The internal control system ensures compliance with all applicable laws
and regulations and facilitates optimum utilisation of available resources and protects
the interests of all stakeholders. The Company has clearly defined Policies, Standard
Operating Procedures (SOPs), Financial and Operational Delegation of Authority (DOA) and
Organisational Structure for its business functions to ensure a smooth conduct of its
business. The Enterprise Resource Planning (ERP) system supports in standardisation of
processes and automation. The Compliance initiatives taken by the Company have been
reported in the Corporate Governance Report, which forms part of this Report.
The internal audit plan is also aligned to the business objectives of
the Company, which is reviewed and approved by the Audit Committee. Further, the Audit
Committee monitors the adequacy and effectiveness of your Company's internal control
framework. Significant audit observations are followed-up and the actions taken are
reported to the Audit Committee.
The Company's internal control system is commensurate with the nature,
size and complexities of operations.
Insider Trading Code
The 'DLF Code of Conduct to Regulate, Monitor and Report by Designated
Persons and Immediate Relatives' is in compliance with the SEBI (Prohibition of Insider
Trading) Regulations, 2015, as amended ('the PIT Regulations'). The said Code lays down
guidelines for Designated Persons on the procedures to be followed and disclosures to be
made in dealing with the securities of the Company and cautions them on consequences of
non-compliances.
The Code of Practices and Procedures of Fair Disclosures of Unpublished
Price Sensitive Information including a Policy for determination of legitimate purposes is
also in line with the PIT Regulations. Further, the Company has put in place an adequate
and effective system of internal controls including maintenance of structured digital
database, standard processes to ensure compliance with the requirements of the PIT
Regulations to prevent insider trading.
Risk Management
The Board of Directors of the Company have formed a Risk Management
Committee to frame, implement and monitor the Risk Management Plan for the Company. The
Committee is responsible for monitoring and reviewing the Risk Management Plan and
ensuring its effectiveness. The major business and process risks are identified from time
to time by the businesses and functional heads. The Audit Committee has additional
oversight in the area of financial risks and controls. The major risks identified by the
businesses and functions are systematically addressed through mitigating actions on a
continuing basis.
Risk management forms an integral part of the management policies and
is an ongoing process integrated deeply into everyday operations.
During the period under review, the Board of Directors of the Company
has revised roles and responsibilities of the Committee which are in keeping with SEBI
Listing Regulations and to ensure that the whole process of risk management is well
coordinated and carried out as per mitigation plan.
The development and implementation of Risk Management Policy has been
covered in the Management Discussion and Analysis Report, which forms part of this report.
Significant and Material Orders passed by Regulators or Courts or
Tribunals
During the year under review, no significant and material order was
passed by the regulators/ courts/ tribunals which would impact the going concern status of
the Company and its future operations. However, some significant orders passed previously,
forms part of Note 50 to the Standalone Financial Statements.
A petition under Section 9 of the Insolvency and Bankruptcy Code, 2016
('IBC') was filed by IL & FS Engineering Construction Company Limited ('IL & FS')
praying that the Corporate Debtor is liable to pay approximately Rs 46.34 crore in
connection with a road project contract at Sector 56, Gurugram. The Company has filed its
reply, inter-alia that the said amount is not payable and hence, the petition is liable to
be dismissed. The Company without prejudice to its rights, submitted its claims of Rs
381.49 crore against IL & FS as on 15 October 2018 (cut-off date) to Claims Management
Advisor i.e. Grant Thornton Bharat LLP, out of total claim of ~Rs 607.04 crore.
With respect to claims after 15 October 2018, the Company has also
filed an application under Section 11 of the IBC before the Hon'ble Delhi High Court
praying to appoint a sole arbitrator to adjudicate the disputes between the parties.
Vigil Mechanism
The Company has a Whistle Blower Policy and has established the
necessary vigil mechanism for directors and employees in confirmation with Section 177(9)
of the Act and Regulation 22 of SEBI Listing Regulations, to report concerns about
unethical behaviour.
The Whistle Blower Policy is available on the Company's website at https://www.dlf.in/corporate-governance-
policies/DLFWBP.pdf.
Policy for Prevention, Prohibition and Redressal of Sexual Harassment
of Women at Workplace
The Company continues to follow a robust anti-sexual harassment policy
on 'Prevention, Prohibition and Redressal of Sexual Harassment of Women at Workplace' in
accordance with The Sexual Harassment of Women at Workplace (Prevention, Prohibition &
Redressal) Act, 2013 ('POSH') and Rules made thereunder. Internal Complaints Committee has
been set-up to redress complaints received regarding sexual harassment at various
workplaces in accordance with POSH. The Committee constituted in compliance with POSH
ensures a free and fair enquiry process with clear timelines for resolution. To build
awareness in this area, the Company has been conducting programmes on regular basis.
All employees, including those of subsidiaries (permanent, contractual,
temporary, trainees) are covered under this Policy. The Policy is gender neutral.
During the FY, one case was reported which has undergone the due
process as per the Policy. The Company continues to promote the cause of women colleagues,
through 'Jagruti', all-women's forum for experience sharing, creating awareness on women's
safety/ related issues, celebrating important days dedicated to women and organising
workshops on gender sensitivity.
Other Information
During the FY, no disclosure or reporting is required in respect of the
following matters:
• Issue of equity shares with differential rights as to dividend,
voting or otherwise;
• Issue of shares (including sweat equity shares) to employees of
the Company under any scheme save and except Employees' Stock Options Scheme referred to
in this Report;
• There has been no change in the nature of business of the
Company; and
• There was no instance of one time settlement with any Bank or
Financial Institution.
Acknowledgements
The Board of Directors wish to place on record their sincere
appreciation to all the employees for their dedication and commitment. Their hard work and
unstinted efforts enabled the Company to sustain its performance and consolidate its
sectoral leadership.
The Board of Directors would like to express their sincere appreciation
for assistance and co-operation received from vendors and stakeholders, including
financial institutions, banks, Central and State Government authorities, customers and
other business associates, who continued to extend their valuable support during the year
under review. It will be the Company's endeavour to nurture these relationships in
strengthening business sustainability.
The Board of Directors offers their deepest condolences to the family
members for loss of their loved ones due to second wave of COVID-19 pandemic and are
grateful and have immense respect for every person who risked his/ her life and safety to
fight this pandemic.
The Board of Directors appreciate and value the contribution made by
every member of DLF family who remain dedicated to the Company during these difficult
times.
|
For and on behalf of the Board of Directors |
|
|
(Ashok Kumar Tyagi) |
(Devinder Singh) |
|
CEO and Whole-time |
CEO and Whole-time |
| 17 May 2022 |
Director |
Director |
| Gurugram |
(DIN: 00254161) |
(DIN: 02569464) |
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