We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Customisable watchlists with full streaming quotes from leading exchanges, such as LSE, NASDAQ, NYSE, AMEX, Bovespa, BIT and more.
| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Dhir India | LSE:DHIR | London | Ordinary Share | IM00B1YC5V43 | ORD 10P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 42.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
Hot Features
Premium
TIDMDHIR
RNS Number : 6417Q
Dhir India Investments plc
06 August 2010
5 August 2010
Dhir India Investments plc
("Dhir India", "DII", or the "Company")
Final Results
Dhir India (AIM: DHIR), the first UK quoted company established to invest in the
US$50 billion Indian non-performing assets sector, announces final results for
the year ended 31 March 2010.
Highlights:
· The portfolio comprises interests in five projects and one quoted
business on the Bombay Stock Exchange
· Headline net asset value per share, including deferred tax provisions,
for Dhir India at the period end was 130p (133p at 31 March 2009).
· Significant progress made in completing the resolution of four of the six
assets
· Three projects have now entered the exit phase, with a part realisation
in one of them achieved at a satisfactory price of GBP2.15 million
· Further realisations are expected over the coming fiscal year
Charlie Hambro, Chairman of Dhir India, commented:
"Dhir India is well placed to take advantage of the hard work done over the past
three years. Your Board now looks forward to a period of tangible progress as
certain of our original investments are realised. Upon completion and the
receipt of investment proceeds, we intend to make further selective investments
as a result of the significant opportunities that are still available in the
Indian non performing asset market."
Alok Dhir, Non-Executive Director of Dhir India, added:
"Having experienced delays, partly as a result of the economic environment, it
is pleasing to be involved in the final exit phase with certain of our original
investments. The Company remains focused on controlling operating costs and
preserving our cash position, and looks forward to the coming year with improved
confidence."
For further information, please contact:
+---------------------+-------------------------+----------------------+
| Shiva Consultants | Evolution Securities | Tavistock |
| | | Communications |
+---------------------+-------------------------+----------------------+
| Alok Dhir | Jeremy Ellis | Jeremy Carey |
+---------------------+-------------------------+----------------------+
| Shivi Agarwal | Chris Clarke | Simon Hudson |
+---------------------+-------------------------+----------------------+
| | | Simon Compton |
+---------------------+-------------------------+----------------------+
| Tel: + 91 11 | Tel: +44 (0) 20 7071 | Tel: + 44 (0) 207 |
| 42410000 | 4300 | 920 3150 |
+---------------------+-------------------------+----------------------+
Chairman's Statement
I am able to report that Dhir India Investments plc ("the Company") has
continued to make progress during the year ended 31 March 2010. However, as is
often the case in this type of company and this type of economic environment,
the progress has been mixed, with some projects continuing to show promise and
moving forward and others proving to be more difficult to unlock. In my interim
report to shareholders in December 2009 I stated that, as a result of the
uncertain global conditions, it was likely that the realisation of our
investments would take longer than envisaged, and this continues to be the case.
I reported previously that we expected some realisations by the middle of 2010.
For reasons mentioned above, the expected realisation timetable has been
extended, but in three projects we have now entered the exit phase, with a part
realisation in one of them now achieved at a satisfactory price. We expect
finalisation of the process during the next few months. The remainder of the
portfolio consists of a spread of investment potential. In one case we remain
quietly confident of a very satisfactory outcome and consequently are looking to
increase our exposure, whilst on the remaining two investments the prognosis
seems to indicate a longer time frame.
As I mentioned in my last report, your Board continues to be aware of the
importance of controlling operating costs and preserving the satisfactory cash
position of the Company. As last year, our Investment Manager, Shiva Consultants
Private Limited, has extended its agreement to reduce its Management Fee for a
further year and the Board is once again grateful for their flexibility in this
matter.
Results
The portfolio now comprises interests in five projects and one quoted business
on the Bombay Stock Exchange. These are reviewed in detail in the Investment
Managers' Review below. The total cost to date of the investments is GBP17.37
million with a possible committed cost of the investments totalling GBP24.08m.
The underlying investments have been valued by PriceWaterhouseCoopers India as
at 31 March 2010. However, as in the previous financial year, given the ever
changing economic outlook and greater visibility on each of the investments, the
Board considered it prudent to take a more conservative and individual approach
to the valuation of the portfolio. After taking into account both individual
issues and the general arithmetic valuation calculations, the Board decided to
continue its cautious policy. However, during the reporting period, the rupee
has appreciated against sterling by some 8.5% and consequently, the fair value
of our share of these underlying investments at the balance sheet date was
GBP20.50 million (GBP19.3 million at 31 March 2009), excluding deferred tax
provisions of GBP2.05 million (GBP1.86 million at 31 March 2009).
Headline net asset value per share, including deferred tax provisions, for Dhir
India at the period end was 130p (133p at 31 March 2009). The adjusted net
asset value, excluding the deferred tax provision of GBP2.05 million, which the
Directors anticipate should not be payable, is 143p (144p at 31 March 2009).
The statement of comprehensive income shows loss attributable to shareholders of
GBP1.0 million and a loss per share of 6.02p. Total consolidated cash balances
at the period end were GBP6.3 million (GBP7.4 million at 31 March 2009), before
taking into account receipt of the GBP2.15 million proceeds of the recent sale
of plant and machinery at Project Cygnet detailed in the Investment Mangers'
review. The Company has no borrowings.
The investments
The investment portfolio is diversified both by regional geography and
realisation strategy. As previously noted, over the past year there has been
progress on a number of our investments. The appropriate exit strategies for
each investment continue to be reviewed and range from the turnaround and resale
of operating businesses to the break-up and sale of underlying assets.
Outlook
Despite a continued stuttering economic performance from the large consumer
economies, the growth economies, unsurprisingly, continue to enjoy a healthier
outlook. India is no exception to this and internally, economic confidence
continues to grow. However, India is not isolated from the knock on effects of
either the economic slowdown or sovereign credit issues that have bedevilled
many of the established economies.
We are now entering a period where your Board anticipates achieving realisations
over the coming fiscal year and the Company is well placed to take advantage of
the hard work done over the past three years. Once these realisations are
effected, your Board expects to make further selective investments in new
projects as the Company continues to see significant opportunities in the Indian
non-performing asset market, subject to taking into consideration the need to
conserve cash in the current environment.
Charlie Hambro
5 August 2010
Investment Managers' Review
Introduction
The Company, through its Investment Manager, has made commitments to invest in
Indian non-performing assets ("NPAs"), which have a potential cost totalling
GBP24.08million. This would represent full investment of the funds raised in the
Placing associated with Admission to AIM in July 2007. The Company's Investment
Manager is Shiva Consultants Private Limited, which is responsible for sourcing,
appraising and managing investment opportunities.
The Investment Manager's senior team between them has over 60 years' experience
in the Indian distressed assets market. This includes the structuring and
resolving of distressed assets transactions on a professional basis, as well as
investing in NPAs as principal and undertaking the turnaround of distressed
assets. The Investment Manager is very well connected within the business and
financial community in India in all the regions in which it operates.
Recently a transaction for the realisation of part of the investment made by one
of its SPV has been finalised for a consideration of approximately GBP2.15
million, all of which has now been received.
Investment Policy
The Company has a risk-diversified portfolio of six current investments in
Indian NPAs, largely sourced from Indian lending banks and financial
institutions. The exits from such investments are based on the different
realisation strategies outlined in the AIM Admission Document; turnaround and
resale or break-up and sale of acquired assets. When determining the appropriate
realisation strategy, the Board considers in each case the nature of the asset,
together with the management skills and resources required for resolution.
Going forward, looking to the current recessionary trends in different parts of
the world which has delayed the exits from current investments, the Board is of
the view that any further investment should appropriately take into
consideration the need to conserve cash.
Project Turquoise (Rajasthan)
The investment is in respect of a company which was originally engaged in the
manufacturing of electrical and electronic meters but ceased production in 1998
due to an inability to restructure the business and invest in plant and
machinery. The plant is located on a 41,000 sqm site in the centre of a
prominent city in Rajasthan.
The total acquisition cost is projected at GBP6.55 million, of which the
Company's share is estimated to be GBP4.91 million. As at 31 March 2010, an
amount of GBP1.84 million had been invested through a special purpose vehicle
("SPV") of which the Company's contribution is GBP1.38 million. The SPV has
entered into an agreement with the first charge holder, holding 33% of the total
secured debt for acquisition of the unit of the said company. The SPV is now
negotiating with the other secured creditors and stakeholders for completing
acquisition of the said unit. Vigorous efforts are being made for the resolution
of the said assets including negotiations with various stakeholders, such as
workers and promoters, to resolve the asset.
Project Aquamarine (Uttar Pradesh)
The investment is in respect of a company which was originally engaged in the
manufacturing of styrene butadiene rubber, nitrite rubber, styrenated phenol and
alcohol. It suspended works in July 1999, due to severe capital constraints and
labour and power supply issues. Its plant is located over 1,200 acres of land
which is situated in a tier II industrial city in Uttar Pradesh, North India.
As at 31 March 2010 an amount of GBP1.88 million had been invested through an
SPV, of which the Company's contribution is GBP1.41 million. The SPV has since
acquired interest in the company through agreements executed with creditors
having 33.46% of the secured debt of the target company. Such interest has been
acquired at a cost lower than the original projected cost and the SPV is
therefore in negotiations with other stakeholders for acquiring further interest
in the target company within the original projected cost.
Project Triton (Gujarat)
The investment is in respect of a company which was engaged in the manufacture
of edible oil at its refining unit in Gujarat. It has a factory, with a daily
capacity of 250 MT per day and is built on a 21,524 sqm site in a prominent city
of Gujarat. The unit has been lying closed since 2006.
The total acquisition cost was originally projected at GBP2.24 million, of which
the Company's share was GBP2.13 million. It was initially proposed that the
edible oil unit could be turned around and managed. However, after extensive
discussions, the Board thought it more appropriate that the exit should be by
way of a re-sale of assets and mandated the Investment Manager to obtain
suitable offers for re-sale of the assets. Accordingly, since the plant is not
required to be operated, the projected costs have been reduced to GBP1.15
million, of which the Company's share is projected at GBP1.09 million. As at 31
March 2010 an amount of GBP1.18 million had been invested through an SPV of
which the Company's contribution was GBP1.12 million. The SPV has entered into
agreements with all the secured creditors of the company in respect of
acquisition / sale of the unit of the said company.
The investment with respect to the said asset is proposed to be realised through
sale of the unit by Public Auction for which advertisements have been released
in the Newspapers.
Project Destination India (Goa)
The investment is in respect of a company which had proposed to set up a resort
in Goa on 369,814 sqm of land, for which the company obtained all permissions
and consents and had commenced construction. Goa is a popular tourist
destination and the land, with its planning consent, is an attractive site with
significant development potential.
The total acquisition cost was originally projected at GBP8.10 million, of which
the Company's share was proposed at GBP7.70 million. However, in view of various
litigations, the offer to secured creditors for the purchase of the hotel assets
has been reduced. Consequently, the projected acquisition cost has come down to
GBP5.56 million of which the Company's share is proposed at GBP5.28 million. As
at 31 March 2010 an amount of GBP1.94 million had been invested through an SPV
of which the Company's contribution was GBP1.85 million. The SPV has entered
into an agreement with the first charge holder, holding just over 25% of the
total secured debt for acquisition of the hotel asset of the said company. The
SPV is now negotiating with the other secured creditors and promoters /
stakeholders for completing the acquisition of the said hotel asset.
Project LCAL (Alwar, Rajasthan)
LCAL manufactures caustic soda based products, supplying the paper, soap, dyes,
chemicals and plastic industries. It performed satisfactorily until 1997 when it
incurred significant losses as a result of lengthy power cuts and increases in
input production costs. Thereafter, from 2003, a new management team has
effected a recovery of the business.
The Company acquired 1,500,000 new equity shares in LCAL at a price of 74p per
share, representing 5.96% of the issued share capital, for a total of GBP1.1
million. The proceeds of the issue were utilised by LCAL, inter alia, towards
the purchase of 230 TPD plant of Standard Industries, Mumbai. Of this, LCAL has
completed installation of 130 TPD plant, which along with its existing capacity
has taken the total installed capacity to 230 TPD and the balance 100 TPD plant
shall be installed in due course.
The shares of the LCAL have been listed at the Bombay Stock Exchange; however,
they are presently being thinly traded. The Company plans to exit from its
investments by sale of the said shares at the appropriate time.
Project Cygnet (Haryana)
The investment is in respect of a company which was originally engaged in the
manufacture of stainless steel located on a 51 acre site in Haryana, on the
outskirts of Delhi.
The total acquisition cost was originally projected at GBP12.79 million, of
which the Company's share was proposed at GBP11.51 million. As at 31 March 2010
an amount of GBP12.26 million had been invested through an SPV of which the
Company's contribution was GBP11.04 million. The SPV has entered into
agreements with all the secured creditors of the company for acquisition of the
unit of the said company. Recently a transaction for realisation of its
investment by way of sale of Plant & Machinery of the said unit has been
finalised for a consideration of approximately GBP2.15 million, of which all of
the funds have now been received. Process for realisation of the remaining
investment is also under way.
Risks
In spite of the Company investing in diversified assets and industries, the
investments are exposed to certain illiquidity and market risks as they are
principally investments in assets and liabilities of distressed companies and
unquoted equity securities. Further, investments in such companies are
inherently difficult to value. In addition, the Company's operations are
conducted in jurisdictions which generate revenue, expenses, assets and
liabilities in currencies other than Sterling. As a result, the Company is
subject to the effects of exchange rate fluctuations with respect to these
currencies. The currency giving rise to this risk is primarily the Indian
Rupee.
Outlook
The Company was able to commit a large part of the IPO proceeds within a short
period post Admission and has progressed significantly in completing the
resolution of four of the six assets that it has invested into, with the
remaining two indicating a longer time frame. There has been some delay in exits
from such assets, partly on account of recession and liquidity issues in
economies across the world, including India. Therefore, while the Investment
Manager is taking more intensive steps for realisation of such assets, the
valuations provided in this Annual Report reflect suitable discounts on account
of such illiquidity and delay in realisation.
Change to Investing Policy
In relation to the Investing Restrictions set out in the investing policy below,
under the terms of the Management Agreement the Board has discretion to consider
deviation from these parameters while evaluating specific proposals. Any such
deviation has been and would be in line with the objectives to achieve the
Company's target return to Shareholders and an appropriate mitigation of risk.
The AIM Rule changes in relation to investing companies, which were published on
1 June 2009, required shareholder approval for any material changes to investing
policy necessary to meet the new requirements. The Company therefore sought and
obtained shareholder approval for the following new investing policy, largely
based on the information contained in the Company's AIM Admission Document dated
6 July 2007, which details inter alia the Board's discretion to consider
deviation from the stated investing restriction parameters at the Annual General
Meeting of the Company held on 26 October 2009.
New Investing Policy
Investing Objective
The Company intends to invest in distressed companies and distressed assets in
India with the objective of providing shareholders with income and capital
growth.
Investing Strategy
The investmentswill be structured primarily in the following four types of tran
action:
Turnaround of companies
In these transactions, the objective is to acquire an interest in a target
company through its secured debt (and a minority equity interest where
appropriate). The aim will be to benefit from the control taken of the target
company, its operations and its assets and, if appropriate, to change or
motivate existing management and implement a new strategy to turn around the
business.
Target companies will typically be under-performing due to financial,
operational or management constraints and an overhang of debt, but with the
potential for achieving a turnaround through restructuring. In such
transactions, the Manager may arrange to provide the target company with a range
of technical, legal, management and financial inputs, as required.
The Directors believe that exits from such an investment will be achieved
principally through selling the controlling interest in the target company to a
third party or to the target's existing management or via public offering. The
Company intends to work to a time frame of 24-36 months from acquisition to exit
in such transactions.
Re-sale of assets or companies
The objective in these transactions is to obtain benefit from a change in
control of the target company or its assets through the secured debt. The
Company and its subsidiaries (the "Group") will consider acquiring a minority
equity interest in target companies and/or assets but the Company would not
acquire a majority of the equity interest.
The value in such transactions lies in being able to acquire or settle the debts
of the target company at a discount to the market value of the underlying assets
of the business as a whole and then to restructure the debts so as to achieve
the desired return upon a sale of the target company or its assets.
An exit is achieved through the sale of its assets to a third party purchaser
and/or the equity when sold. The Manager will seek to identify such transactions
in sectors where there is demand for consolidation and capacity addition.
The Company intends to work to a time frame of 9-12 months from acquisition to
exit in such transactions.
Break-up and sale of assets
The objective of these transactions is to obtain benefit from a change in
control of the target company or its assets by taking a secured debt position
with a view to realising latent value through the sale of individual assets or
parts of the business to different buyers. The Group will consider acquiring a
minority equity interest in target companies and / or assets, but the Company
would not acquire a majority of the equity interest. This process will entail
the negotiation and restructuring of debts with creditors and lenders, the
consolidation of security and the sale of assets to third party buyers.
The Directors consider that this type of transaction is particularly attractive
where there are high value assets in the target company, and the Company expects
that the debt can be settled at a discount to market value. The Company intends
to work to a time frame of 12-15 months from acquisition to exit in such
transactions.
Bridge financing
In these transactions the objective is to provide short term bridge financing to
target companies that are in need of immediate funds to complete one time
settlements with secured creditors and which have cash flows to support the
repayment of the financing (together with the Company's desired return) to the
Group over a period of 6-9 months.
Gearing
The Directors anticipate that, due to a lack of sophisticated distress lenders
in India and with the exception of bridge financing transactions, the Group's
transactions will generally be funded by the Group from the proceeds of equity
investments into the Group and not through debt.
Investing Restrictions
The Company will only invest in Indian distressed companies and distressed
assets. The Company will not have a predetermined preference of allocation in
the type of transactions outlined above, but will aim to build a diversified
portfolio by:
· investing no more than GBP5 million in transactions relating to one
single entity;
· investing no more than 50 per cent. of the net asset value of its
portfolio in one single transaction type; and
· not investing in transactions where the intrinsic value of the underlying
assets is believed to be less than the amount of the investment required.
The Board may however consider deviation from the above parameters while
evaluating specific proposals. These investment restrictions will apply at the
time of the initial investment in a particular opportunity and subsequent
transactions which affect these ratios will not lead to a requirement to divest
any investment to rebalance the portfolio. There are no obligations on the
Company or the Manager to make any investments or to return monies to
shareholders within a minimum period of time.
Note: The amounts mentioned in the Investment Managers Review may vary from year
to year due to exchange rate differences.
Consolidated Statement of Comprehensive Income
For the year ended 31 March 2010
+-------------------------------+------+-------------+--+-----------+
| | | Year ended | | Year |
| | | 31 March | | ended |
| | | 2010 | | 31 March |
| | | | | 2009 |
+-------------------------------+------+-------------+--+-----------+
| | | GBP'000 | | GBP'000 |
+-------------------------------+------+-------------+--+-----------+
| Interest income on cash | | 42 | | 304 |
| balances | | | | |
+-------------------------------+------+-------------+--+-----------+
| Dividend income | | 107 | | 86 |
+-------------------------------+------+-------------+--+-----------+
| Excess provision written-off | | 2 | | 1 |
+-------------------------------+------+-------------+--+-----------+
| Investment income | | 151 | | 391 |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Investment management fees | | (445) | | (649) |
+-------------------------------+------+-------------+--+-----------+
| Other administration expenses | | (683) | | (777) |
+-------------------------------+------+-------------+--+-----------+
| Total expenses | | (1,128) | | (1,426) |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Loss before taxation | | (977) | | (1,035) |
+-------------------------------+------+-------------+--+-----------+
| Taxation | | (48) | | - |
+-------------------------------+------+-------------+--+-----------+
| Loss for the year | | (1,025) | | (1,035) |
+-------------------------------+------+-------------+--+-----------+
| Other comprehensive | | | | |
| (loss)/income | | | | |
+-------------------------------+------+-------------+--+-----------+
| Unrealised change in fair | | (1,273) | | (6,750) |
| value of available-for-sale | | | | |
| financial assets | | | | |
+-------------------------------+------+-------------+--+-----------+
| (Less)/add deferred | | (190) | | 840 |
| taxation | | | | |
+-------------------------------+------+-------------+--+-----------+
| Add performance fee | | - | | 1,088 |
| provision | | | | |
+-------------------------------+------+-------------+--+-----------+
| Foreign currency translation | | 2,185 | | 853 |
| differences for foreign | | | | |
| operations | | | | |
+-------------------------------+------+-------------+--+-----------+
| Other comprehensive | | 722 | | (3,969) |
| income/(loss) for the year, | | | | |
| net of income tax | | | | |
+-------------------------------+------+-------------+--+-----------+
| Total comprehensive loss for | | (303) | | (5,004) |
| the year | | | | |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Loss attributable to: | | | | |
+-------------------------------+------+-------------+--+-----------+
| Equity holders of the Company | | (1,003) | | (1,002) |
+-------------------------------+------+-------------+--+-----------+
| Non-controlling interest | | (22) | | (33) |
+-------------------------------+------+-------------+--+-----------+
| Loss for the year | | (1,025) | | (1,035) |
+-------------------------------+------+-------------+--+-----------+
+-------------------------------+------+-------------+--+-----------+
| Total comprehensive loss | | | |
| attributable to: | | | |
+--------------------------------------+-------------+--+-----------+
| Equity holders of the Company | | (537) | | (4,282) |
+-------------------------------+------+-------------+--+-----------+
| Non-controlling interest | | 234 | | (722) |
+-------------------------------+------+-------------+--+-----------+
| Total comprehensive loss for | | (303) | | (5,004) |
| the year | | | | |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Basic and diluted loss per | | (6.02) | | (6.01) |
| share (pence) | | | | |
+-------------------------------+------+-------------+--+-----------+
The Directors consider that all results derive from continuing
activities.
Consolidated Statement of Financial Position
As at 31 March 2010
+-------------------------------+------+-------------+--+-----------+
| | | At 31 March | | At 31 |
| | | 2010 | | March |
| | | | | 2009 |
+-------------------------------+------+-------------+--+-----------+
| | | GBP'000 | | GBP'000 |
+-------------------------------+------+-------------+--+-----------+
| Current assets | | | | |
+-------------------------------+------+-------------+--+-----------+
| Available-for-sale financial | | 20,502 | | 19,296 |
| assets | | | | |
+-------------------------------+------+-------------+--+-----------+
| Trade and other receivables | | 56 | | 152 |
+-------------------------------+------+-------------+--+-----------+
| Cash and cash equivalents | | 6,304 | | 7,408 |
+-------------------------------+------+-------------+--+-----------+
| Total assets | | 26,862 | | 26,856 |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Equity | | | | |
+-------------------------------+------+-------------+--+-----------+
| Share capital | | 1,667 | | 1,667 |
+-------------------------------+------+-------------+--+-----------+
| Share premium | | 21,355 | | 21,355 |
+-------------------------------+------+-------------+--+-----------+
| Fair value reserve | | (2,112) | | (640) |
+-------------------------------+------+-------------+--+-----------+
| Foreign currency translation | | 2,793 | | 855 |
| reserve | | | | |
+-------------------------------+------+-------------+--+-----------+
| Retained loss | | (2,080) | | (1,077) |
+-------------------------------+------+-------------+--+-----------+
| Total equity attributable to | | 21,623 | | 22,160 |
| equity holders of the Company | | | | |
+-------------------------------+------+-------------+--+-----------+
| Non-controlling interest | | 3,019 | | 2,674 |
+-------------------------------+------+-------------+--+-----------+
| Total equity | | 24,642 | | 24,834 |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Non-current liabilities | | | | |
+-------------------------------+------+-------------+--+-----------+
| Deferred tax liabilities | | 2,052 | | 1,862 |
+-------------------------------+------+-------------+--+-----------+
| Total non-current liabilities | | 2,052 | | 1,862 |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Current liabilities | | | | |
+-------------------------------+------+-------------+--+-----------+
| Trade and other payables | | 168 | | 160 |
+-------------------------------+------+-------------+--+-----------+
| Total current liabilities | | 168 | | 160 |
+-------------------------------+------+-------------+--+-----------+
| Total liabilities | | 2,220 | | 2,022 |
+-------------------------------+------+-------------+--+-----------+
| Total equity and liabilities | | 26,862 | | 26,856 |
+-------------------------------+------+-------------+--+-----------+
Approved by the Board of Directors on 5th August 2010
Arun Singh John Bourbon
Director Director
Company Statement of Financial Position
As at 31 March 2010
+-------------------------------+------+-------------+--+-----------+
| | | At 31 March | | At 31 |
| | | 2010 | | March |
| | | | | 2009 |
+-------------------------------+------+-------------+--+-----------+
| | | GBP'000 | | GBP'000 |
+-------------------------------+------+-------------+--+-----------+
| Non-current assets | | | | |
+-------------------------------+------+-------------+--+-----------+
| Investment in subsidiary | | 19,998 | | 20,839 |
+-------------------------------+------+-------------+--+-----------+
| Total non-current assets | | 19,998 | | 20,839 |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Current assets | | | | |
+-------------------------------+------+-------------+--+-----------+
| Trade and other receivables | | 6 | | 9 |
+-------------------------------+------+-------------+--+-----------+
| Cash and cash equivalents | | 1,100 | | 1,119 |
+-------------------------------+------+-------------+--+-----------+
| Total current assets | | 1,106 | | 1,128 |
+-------------------------------+------+-------------+--+-----------+
| Total assets | | 21,104 | | 21,967 |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Equity | | | | |
+-------------------------------+------+-------------+--+-----------+
| Share capital | | 1,667 | | 1,667 |
+-------------------------------+------+-------------+--+-----------+
| Share premium | | 21,355 | | 21,355 |
+-------------------------------+------+-------------+--+-----------+
| Retained loss | | (2,029) | | (1,110) |
+-------------------------------+------+-------------+--+-----------+
| Total equity | | 20,993 | | 21,912 |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Current liabilities | | | | |
+-------------------------------+------+-------------+--+-----------+
| Trade and other payables | | 111 | | 55 |
+-------------------------------+------+-------------+--+-----------+
| Total current liabilities | | 111 | | 55 |
+-------------------------------+------+-------------+--+-----------+
| Total liabilities | | 111 | | 55 |
+-------------------------------+------+-------------+--+-----------+
| Total equity and liabilities | | 21,104 | | 21,967 |
+-------------------------------+------+-------------+--+-----------+
The Company made a loss for the year of GBP919,627 (2009: profit of GBP90,062)
Approved by the Board of Directors on 5th August 2010
Arun Singh John Bourbon
Director Director
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------+--+--------+
| Consolidated Statement of Changes in Equity | |
| | |
| For the year ended 31 March 2010 | |
+---------------------------------------------------------------------------------------------------------------------------+-----------+
| | Share | Share | Foreign | Fair | Retained | Total | Non-controlling | Total | |
| | capital | premium | Currency | value | loss | shareholders' | interest | equity | |
| | | | Translation | reserve | | funds | | | |
| | | | reserve | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+---------+--------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Balance as at 1 April | 1,667 | 21,355 | 205 | 3,290 | (75) | 26,442 | 2,727 | 29,169 |
| 2008 | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Total comprehensive loss | | | | | | | | |
| for the year: | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Loss for the year | - | - | - | - | (1,002) | (1,002) | (33) | (1,035) |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Other comprehensive | | | | | | | | |
| income | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Foreign currency | - | - | 650 | - | - | 650 | 203 | 853 |
| translation differences | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Net change in fair value | | | | | | | | |
| of available-for-sale | | | | | | | | |
| financial assets net of | - | - | - | (3,930) | - | (3,930) | (892) | (4,822) |
| tax and performance fee | | | | | | | | |
| provision | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Total other | - | - | 650 | (3,930) | - | (3,280) | (689) | (3,969) |
| comprehensive | | | | | | | | |
| income/(loss) | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Total comprehensive | | | | | | (4,282) | | |
| income/(loss) for the | - | - | 650 | (3,930) | (1,002) | | (722) | (5,004) |
| year | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Transactions with owners | | | | | | | | |
| recorded directly in | | | | | | | | |
| equity: | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Contributions from | | | | | | | | |
| non-controlling interest | - | - | - | - | - | - | 669 | 669 |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Total transactions with | - | - | - | - | - | - | 669 | 669 |
| owners | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| Balance at 31 March 2009 | 1,667 | 21,355 | 855 | (640) | (1,077) | 22,160 | 2,674 | 24,834 |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------------------+
| | | | | | | | | | | |
+--------------------------+---------+---------+-------------+----------+----------+---------------+-----------------+------+--+--------+
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+------+--------+
| Consolidated Statement of Changes in Equity (continued) | |
| | |
| For the year ended 31 March 2010 | |
+----------------------------------------------------------------------------------------------------------------------------+--------+
| | Share | Share | Foreign | Fair | Retained | Total | Non-controlling | Total equity |
| | capital | premium | Currency | value | loss | shareholders' | interest | |
| | | | Translation | reserve | | funds | | |
| | | | reserve | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Balance as at 1 April | 1,667 | 21,355 | 855 | (640) | (1,077) | 22,160 | 2,674 | 24,834 |
| 2009 | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Total comprehensive loss | | | | | | | | |
| for the year: | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Loss for the year | - | - | - | - | (1,003) | (1,003) | (22) | (1,025) |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Other comprehensive | | | | | | | | |
| income | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Foreign currency | - | - | 1,938 | - | - | 1,938 | 247 | 2,185 |
| translation differences | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Net change in fair value | | | | | | | | |
| of available-for-sale | | | | | | | | |
| financial assets net of | - | - | - | (1,472) | - | (1,472) | 9 | (1,463) |
| tax and performance fee | | | | | | | | |
| provision | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Total other | - | - | 1,938 | (1,472) | - | 466 | 256 | 722 |
| comprehensive | | | | | | | | |
| income/(loss) | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Total comprehensive | | | | | | (537) | | |
| income/(loss) for the | - | - | 1,938 | (1,472) | (1,003) | | 234 | (303) |
| year | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Transactions with owners | | | | | | | | |
| recorded directly in | | | | | | | | |
| equity: | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Contributions from | | | | | | | | |
| non-controlling interest | - | - | - | - | - | - | 111 | 111 |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Total transactions with | - | - | - | - | - | - | 111 | 111 |
| owners | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| Balance at 31 March 2010 | 1,667 | 21,355 | 2,793 | (2,112) | (2,080) | 21,623 | 3,019 | 24,642 |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+---------------+
| | | | | | | | | | |
+--------------------------+----------+---------+-------------+----------+----------+---------------+-----------------+------+--------+
Company Statement of Changes in Equity
For the year ended 31 March 2010
+---------------+---------+---------+----------+---------+
| | Share | Share | Retained | Total |
| | capital | premium | | |
| | | | loss | |
+---------------+---------+---------+----------+---------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------+---------+---------+----------+---------+
| | | | | |
+---------------+---------+---------+----------+---------+
| Balance | 1,667 | 21,355 | (1,200) | 21,822 |
| as at 1 | | | | |
| April | | | | |
| 2008 | | | | |
+---------------+---------+---------+----------+---------+
| | | | | |
+---------------+---------+---------+----------+---------+
| Total | | | | |
| comprehensive | | | | |
| income for | | | | |
| the year: | | | | |
+---------------+---------+---------+----------+---------+
| Profit | - | - | 90 | 90 |
| for | | | | |
| the | | | | |
| year | | | | |
+---------------+---------+---------+----------+---------+
| | | | | |
+---------------+---------+---------+----------+---------+
| Other | - | - | - | - |
| comprehensive | | | | |
| income | | | | |
+---------------+---------+---------+----------+---------+
| Total | | | | |
| comprehensive | - | - | 90 | 90 |
| income for | | | | |
| the year | | | | |
+---------------+---------+---------+----------+---------+
| Balance | 1,667 | 21,355 | (1,110) | 21,912 |
| as at | | | | |
| 31 | | | | |
| March | | | | |
| 2009 | | | | |
+---------------+---------+---------+----------+---------+
| | | | | |
+---------------+---------+---------+----------+---------+
| | | | | |
+---------------+---------+---------+----------+---------+
| Balance | 1,667 | 21,355 | (1,110) | 21,912 |
| as at 1 | | | | |
| April | | | | |
| 2009 | | | | |
+---------------+---------+---------+----------+---------+
| | | | | |
+---------------+---------+---------+----------+---------+
| Total | | | | |
| comprehensive | | | | |
| loss for the | | | | |
| year: | | | | |
+---------------+---------+---------+----------+---------+
| Loss | - | - | (919) | (919) |
| for | | | | |
| the | | | | |
| year | | | | |
+---------------+---------+---------+----------+---------+
| | | | | |
+---------------+---------+---------+----------+---------+
| Other | - | - | - | - |
| comprehensive | | | | |
| income | | | | |
+---------------+---------+---------+----------+---------+
| | | | | |
| Total | - | - | (919) | (919) |
| comprehensive | | | | |
| loss for the | | | | |
| year | | | | |
+---------------+---------+---------+----------+---------+
| Balance | 1,667 | 21,355 | (2,029) | 20,993 |
| as at | | | | |
| 31 | | | | |
| March | | | | |
| 2010 | | | | |
+---------------+---------+---------+----------+---------+
Consolidated Statement of Cash Flows
For the year ended 31 March 2010
+-------------------------------+------+-------------+--+-----------+
| | | Year ended | | Year |
| | | 31 March | | ended |
| | | 2010 | | 31 March |
| | | | | 2009 |
+-------------------------------+------+-------------+--+-----------+
| | | GBP'000 | | GBP'000 |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Cash flows from operating | | | | |
| activities | | | | |
+-------------------------------+------+-------------+--+-----------+
| Loss for the year | | (1,025) | | (1,035) |
+-------------------------------+------+-------------+--+-----------+
| Adjustments for: | | | | |
+-------------------------------+------+-------------+--+-----------+
| Interest income on cash | | (42) | | (304) |
| balances | | | | |
+-------------------------------+------+-------------+--+-----------+
| Dividend income | | (107) | | (86) |
+-------------------------------+------+-------------+--+-----------+
| | | (1,174) | | (1,425) |
+-------------------------------+------+-------------+--+-----------+
| Increase in trade and other | | (19) | | (6) |
| receivables | | | | |
+-------------------------------+------+-------------+--+-----------+
| Increase in trade and other | | 8 | | 39 |
| payables | | | | |
+-------------------------------+------+-------------+--+-----------+
| Interest and dividends | | 264 | | 308 |
| received | | | | |
+-------------------------------+------+-------------+--+-----------+
| Net cash used in operating | | (921) | | (1,084) |
| activities | | | | |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Cash flows from investing | | | | |
| activities | | | | |
+-------------------------------+------+-------------+--+-----------+
| Receipt of refund from asset | | 628 | | - |
| reconstruction company | | | | |
+-------------------------------+------+-------------+--+-----------+
| Acquisition of investments | | (1,251) | | (3,954) |
+-------------------------------+------+-------------+--+-----------+
| Net cash used in investing | | (623) | | (3,954) |
| activities | | | | |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Cash flows from financing | | | | |
| activities | | | | |
+-------------------------------+------+-------------+--+-----------+
| Proceeds from non-controlling | | 111 | | 669 |
| interest | | | | |
+-------------------------------+------+-------------+--+-----------+
| Net cash flow from financing | | 111 | | 669 |
| activities | | | | |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
| Net decrease in cash and cash | | (1,433) | | (4,369) |
| equivalents | | | | |
+-------------------------------+------+-------------+--+-----------+
| Cash and cash equivalents at | | 7,408 | | 11,232 |
| start of year | | | | |
+-------------------------------+------+-------------+--+-----------+
| Effect of foreign exchange | | 329 | | 545 |
| rate changes on cash and cash | | | | |
| equivalents | | | | |
+-------------------------------+------+-------------+--+-----------+
| Cash and cash equivalents at | | 6,304 | | 7,408 |
| 31 March | | | | |
+-------------------------------+------+-------------+--+-----------+
| | | | | |
+-------------------------------+------+-------------+--+-----------+
Notes to the preliminary results
1 The Company
Dhir India Investments Plc ("the company") was incorporated and registered in
the Isle of Man under the Isle of Man Companies Acts 1931 to 2004 on 20 June
2007 as a public company with registered number 120065C.
Following the close of the placing on 12 July 2007, 16,666,665 shares were
issued.
The Shares of the Company were admitted to trading on the Alternative Investment
Market of the London Stock Exchange ("AIM") on 12 July 2007 when dealings also
commenced.
The Company's agents and the investment manager perform all significant
functions. Accordingly, the company itself has no employees.
The annual report of the Company for the year ended 31 March 2010 comprises the
Company and its subsidiaries (together referred to as the "Group").
2 Basis of preparation
(a) Statement of compliance
The consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRSs).
These preliminary results were authorised for issue by the Board of Directors on
5 August 2010.
(b) Basis of measurement
The consolidated financial statements have been prepared on the historical cost
basis except for available-for-sale financial instruments that are measured at
fair value in the statement of financial position.
(c) Functional and presentation currency
These consolidated financial statements are presented in Sterling, which is the
Company's functional currency. All financial information presented in Sterling
has been rounded to the nearest thousand.
(d) Use of estimates and judgements
The preparation of the consolidated financial statements in conformity with
IFRSs requires management to make judgements, estimates and assumptions that
affect the application of accounting policies and the reported amounts of
assets, liabilities, income and expenses. Actual results may differ from these
estimates. Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates arerecognised in the period in which
the estimates are revised and in any future periods affected.
The areas involving a higher degree of judgment or complexity, or areas where
assumptions and estimates are significant to the consolidated financial
statements are disclosed in Note 5 and 12 (assessment of fair value of
available-for-sale financial assets).
(e) Changes in accounting policy
Presentation of financial statements
The Group applied revised IAS 1 Presentation of Financial Statements (2007),
which became effective as of 1 January 2009. As a result, the Group presents in
the consolidated statement of changes in equity all owner changes in equity,
whereas all non-owner changes in equity are presented in the consolidated
statement of comprehensive income.
Comparative information has been re-presented so that it also is in conformity
with the revised standard. Since the change in accounting policy only impacts
presentation aspects, there is no impact on earnings per share.
(f) Other accounting developments
Disclosures pertaining to fair values and liquidity of financial instruments
The Company has applied Improving Disclosures about Financial Instruments
(Amendments to IFRS 7), issued in March 2009, that require enhanced disclosures
about fair value measurements and liquidity risk in respect of financial
instruments.
The amendments require that fair value measurement disclosures use a three-level
fair value hierarchy that reflects the significance of the inputs used in
measuring fair values of financial instruments. Specific disclosures are
required when fair value measurements arecategorisedas Level 3 (significant
unobservable inputs) in the fair value hierarchy. The amendments require that
any significant transfers between Level 1 and Level 2 of the fair value
hierarchy be disclosed separately, distinguishing between transfers into and out
of each level. Furthermore, changes in valuation techniques from one period to
another, including the reasons therefore, are required to be disclosed for each
class of financial instruments. Disclosures in respect of fair values of
financial instruments are included in notes 5 and 12.
Furthermore the definition of liquidity risk has been amended and it is now
defined as the risk that an entity will encounter difficulty in meeting
obligations associated with financial liabilities that are settled by delivering
cash or another financial asset.
The amendments require disclosure of a maturity analysis for non-derivative and
derivative financial liabilities, but contractual maturities are required to be
disclosed for derivative financial liabilities only when contractual maturities
are essential for an understanding of the timing of cash flows. For issued
financial guarantee contracts, the amendments require maximum amount of the
guarantee to be disclosed in the earliest period in which the guarantee could be
called. Disclosures in respect of liquidity risk are included in note 20.
3 Summary of significant accounting policies
3.1 Basis of consolidation
Subsidiaries
Subsidiaries are those enterprises controlled by the Company. Control exists
where the Company has the power, directly or indirectly, to govern the financial
and operating policies of an enterprise so as to obtain benefits from its
activities. The financial statements of subsidiaries are included in the
consolidated financial statements from the date that control effectively
commences until the date that control effectively ceases.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised gains arising from
intra-group transactions, are eliminated in preparing the consolidated financial
statements.
3.2 Foreign currency
Foreign currency transactions
Transactions in foreign currencies are translated to the presentation currencies
of Group entities at exchange rates at the dates of the transactions. Monetary
assets and liabilities denominated in foreign currencies at the reporting date
are retranslated to the presentation currency at the exchange rate at that date.
Non-monetary assets and liabilities denominated in foreign currencies that are
measured at fair value are retranslated to the presentation currency at the
exchange rate at the date that the fair value was determined. Foreign currency
differences arising on retranslation are recognised in profit or loss, except
for differences arising on the retranslation of available-for-sale equity
instruments, which are recognised in other comprehensive income.
Foreign operations
The assets and liabilities of foreign operations, including goodwill and fair
value adjustments arising on acquisition, are translated to Sterling at exchange
rates at the reporting date. The income and expenses of foreign operations,
excluding foreign operations in hyperinflationary economies, are translated to
Sterling at exchange rates at the dates of the transactions.
Foreign currency differences are recognised in other comprehensive income. When
a foreign operation is disposed of, in part or in full, the relevant amount in
the Foreign Currency Translation Reserve (FCTR) is transferred to profit or loss
as part of the profit or loss on disposal.
3.3 Investments
The Group recognises financial assets initially on the trade date at which the
Group becomes a party to the contractual provisions of the instrument. The Group
derecognises a financial asset when the contractual rights to the cash flows
from the asset expire, or it transfers the rights to receive the contractual
cash flows on the financial asset in a transaction in which substantially all
the risks and rewards of ownership of the financial asset are transferred. Any
interest in transferred financial assets that is created or retained by the
Group isrecognised as a separate asset or liability. Financial assets and
liabilities are offset and the net amount presented in the statement of
financial position when, and only when, the Group has a legal right to offset
the amounts and intends either to settle on a net basis or torealise the asset
and settle the liability simultaneously. The Group has the following
non-derivative financial assets, available-for-sale financial assets.
Investments represent investments for acquisition of assets/units and unquoted
shares. The investments are designated in the category of 'available for sale'
and stated at fair value. In valuing these investments, the Directors follow the
principles recommended in the International Private Equity and Venture Capital
Valuation Guidelines which were effective from January 2005. Subsequent to
initial recognition, the investments are measured at fair value and changes
therein, other than impairment losses (see note 3.10) and foreign currency
differences on available-for-sale equity instruments (see note 3.2),
arerecognised in other comprehensive income and presented within equity in the
fair value reserve. When an investment isderecognised, the cumulative gain or
loss in other comprehensive income is transferred to profit or loss. In the
small minority of cases where fair value cannot be reliably measured, existing
book value, less any impairment, is used as the basis of valuation.
Fair value represents the amount for which an asset could be exchanged between
knowledgeable, willing parties in an arm's length transaction. In estimating
fair value, the Directors use a methodology which is appropriate in light of the
nature, facts and circumstances of the investment and its materiality in the
context of the total investment portfolio. Methodologies are applied
consistently from one period to another except where a change results in a
better estimate of fair value. Because of the inherent uncertainties in
estimating the value of private equity investments, the Directors exercise due
caution in applying the various methodologies. See note 12 regarding valuation
methodology.
3.4 Share capital
Ordinary shares are classified as equity. Incremental costs directly
attributable to the issue of ordinary shares and share options are recognisedas
a deduction from equity, net of any tax effects.
3.5 Cash and cash equivalents
Cash in hand and in banks and short-term deposits, which are held to maturity,
are carried at cost. Cash and cash equivalents are defined as cash in hand,
demand deposits and short-term, highly liquid investments readily convertible to
known amounts of cash and subject to insignificant risk of changes in value.
For the purpose of the cash flow statement, cash and cash equivalents consist of
cash in hand and deposits at banks.
3.6 Revenue and expense recognition
Interest income isrecognisedin the financial statements on an accruals basis
using the effective interest rate basis. Dividend income is recorded when
declared.
Expenses are accounted for on an accrual basis. Expenses are charged to the
profit or loss except for expenses incurred on the acquisition of an investment
which are included within the cost of that investment. Expenses arising on the
disposal of an investment are deducted from the disposal proceeds.
3.7 Dividends
Dividends arerecognisedas a liability in the period in which they are declared
and approved.
3.8 Trade and other receivables
Trade receivables are recognised initially at fair value and subsequently
measured at amortised cost using the effective interest method, less provision
for impairment.
3.9 Trade and other payables
Trade and other payables are stated at their cost.
3.10 Impairment
A financial asset not carried at fair value through profit or loss is assessed
at each reporting date to determine whether there is objective evidence that it
is impaired. A financial asset is impaired if objective evidence indicates that
a loss event has occurred after the initial recognition of the asset, and that
the loss event had a negative effect on the estimated future cash flows of that
asset that can be estimated reliably. Objective evidence that financial assets
(including equity securities) are impaired can include default or delinquency by
a debtor, restructuring of an amount due to the Group on terms that the Group
would not consider otherwise, indications that a debtor or issuer will enter
bankruptcy, the disappearance of an active market for a security. In addition,
for an investment in an equity security, a significant or prolonged decline in
its fair value below its cost is objective evidence of impairment.
Impairment losses on available-for-sale investment securities arerecognised by
transferring the cumulative loss that has beenrecognised in other comprehensive
income, and presented in the fair value reserve in equity, to profit or loss.
The cumulative loss that is removed from other comprehensive income and
recognised in profit or loss is the difference between the acquisition cost and
the current fair value, less any impairment loss previously recognisedin profit
or loss.
If, in a subsequent period, the fair value of an impaired available-for-sale
debt security increases and the increase can be related objectively to an event
occurring after the impairment loss was recognisedin profit or loss, then the
impairment loss is reversed, with the amount of the reversal recognised in
profit or loss. However, any subsequent recovery in the fair value of an
impaired available-for-sale equity security is recognised in other comprehensive
income.
3.11 Income tax expense
Income tax expense comprises current and deferred tax. Income tax expense is
recognised in profit or loss except to the extent that it relates to items
recognised directly in equity, in which case it is recognised in equity. Current
tax is the expected tax payable on the taxable income for the year, using tax
rates enacted or substantively enacted at the reporting date, and any adjustment
to tax payable in respect of previous years.
Deferred tax isrecognisedusing the balance sheet method, providing for temporary
differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for taxation purposes. Deferred tax is
not recognised for the following temporary differences: the initial recognition
of goodwill, the initial recognition of assets or liabilities in a transaction
that is not a business combination and that affects neither accounting nor
taxable profit, and differences relating to investments in subsidiaries and
jointly controlled entities to the extent that they probably will not reverse in
the foreseeable future. Deferred tax is measured at the tax rates that are
expected to be applied to the temporary differences when they reverse, based on
the laws that have been enacted or substantively enacted by the reporting date.
A deferred tax asset isrecognisedto the extent that it is probable that future
taxable profits will be available against which temporary difference can be
utilised. Deferred tax assets are reviewed at each reporting date and are
reduced to the extent that it is no longer probable that the related tax benefit
will be realised.
Additional income taxes that arise from the distribution of dividends are
recognised at the same time as the liability to pay the related dividend is
recognised.
3.12 Future changes in accounting policies
IASB (International Accounting Standards Board) and IFRIC (International
Financial Reporting Interpretations Committee) have issued the following
standards and interpretations with an effective date after the date of these
financial statements:
+---------------------------------------------------+----------------+
| New/Revised International Financial Reporting | Effective date |
| Standards (IAS/IFRS) | (accounting |
| | periods |
| | commencing |
| | after) |
+---------------------------------------------------+----------------+
| IAS 1 Presentation of Financial Statements | 1 January 2010 |
| (Revised April 2009)* | |
+---------------------------------------------------+----------------+
| IAS 7 Statement of Cash Flows (Revised April | 1 January 2010 |
| 2009)* | |
+---------------------------------------------------+----------------+
| IAS 24 Related Party Disclosures - Revised | 1 January 2011 |
| definition of related parties | |
+---------------------------------------------------+----------------+
| IAS 32 Financial Instruments: Presentation - | 1 February |
| Amendments relating to classification of rights | 2010 |
| issues | |
+---------------------------------------------------+----------------+
| IAS 36 Impairment of Assets (Revised April 2009)* | 1 January 2010 |
+---------------------------------------------------+----------------+
| IAS 39 Financial Instruments: Recognition and | 30 June 2009 |
| Measurement - Amendments for embedded derivatives | |
| when reclassifying financial instruments | |
+---------------------------------------------------+----------------+
| IAS 39 Financial Instruments: Recognition and | 1 July 2009 |
| Measurement - Amendments for eligible hedged | |
| items | |
+---------------------------------------------------+----------------+
| IAS 39 Financial Instruments: Recognition and | 1 January 2010 |
| Measurement (Revised April 2009)* | |
+---------------------------------------------------+----------------+
| IFRS 3 Business Combinations - Comprehensive | 1 July 2009 |
| revision on applying the acquisition method | |
+---------------------------------------------------+----------------+
| IFRS 5 Non-current Assets Held for Sale and | 1 January 2010 |
| Discontinued Operations (Revised April 2009)* | |
+---------------------------------------------------+----------------+
| IFRS 8 Operating Segments (Revised April 2009)* | 1 January 2010 |
+---------------------------------------------------+----------------+
| IFRS 9 Financial Instruments - Classification and | 1 January 2013 |
| Measurement | |
+---------------------------------------------------+----------------+
| IFRIC Interpretation | |
+---------------------------------------------------+----------------+
| IFRIC 17 Distributions of Non-Cash Assets to | 1 July 2009 |
| Owners | |
+---------------------------------------------------+----------------+
| IFRIC 18 Transfers of Assets from Customers | 1 July 2009 |
+---------------------------------------------------+----------------+
| IFRIC 19 Extinguishing Financial Liabilities with | 1 July 2010 |
| Equity Instruments | |
+---------------------------------------------------+----------------+
*Amendments resulting from April 2009 Annual Improvements to IFRSs
The Directors do not expect the adoption of the standards and interpretations to
have a material impact on the Group's financial statements in the period of
initial application.
4. Segment reporting
The Group operates as one business and geographic segment, being investment in
distressed debt, in India.
5. Critical accounting estimates and assumptions
These disclosures supplement the commentary on financial risk management (see
note 20).
Key sources of estimation uncertainty
Determining fair values
The determination of fair values for financial assets for which there is no
observable market prices requires the use of valuation techniques as described
in accounting policy 3.3 and note 12. For financial instruments that trade
infrequently and have little price transparency, fair value is less objective,
and requires varying degrees of judgement depending on liquidity, concentration,
uncertainty of market factors, pricing assumptions and other risks affecting the
specific instrument. See also "Valuation of financial instruments" below.
Critical judgements in applying the Group's accounting policies
Critical judgements made in applying the Group's accounting policies include:
Valuation of financial instruments
The Group's accounting policy on fair value measurements is discussed in
accounting policy 3.3. The Company measures fair value using the following
hierarchy that reflects the significance of inputs used in making the
measurements:
· Level 1: Quoted market price (unadjusted) in an active market for and
identical instrument.
· Level 2: Valuation techniques based on observable inputs, either directly
(i.e., as prices) or indirectly (i.e., derived from prices). This category
includes instruments valued using: quoted market prices in active markets for
similar instruments: quoted market prices for identical or similar instruments
in markets that are considered less than active; or other valuation techniques
where all significant inputs are directly or indirectly observable from market
data.
· Level 3: Valuation techniques using significant unobservable inputs. This
category includes all instruments where the valuation technique includes inputs
not based on observable data and the unobservable inputs have a significant
effect on the instrument's valuation. This category includes instruments that
are valued based on quoted prices for similar instruments where significant
unobservable adjustments or assumptions are required to reflect differences
between the instruments.
Fair values of financial assets and financial liabilities that are traded in
active markets are based on quoted market prices or dealer price quotations. For
all other financial instruments the Group determines fair values using valuation
techniques.
The Group holds ownership interests in the debt of certain unquoted Indian
distressed companies and one direct investment in the equity of one listed
distressed company. The fair value of investments, as shown in note 12, is
based on independent valuations.
The table below analyses financial instruments measured at fair value at the end
of the reporting period, by the level in the fair value hierarchy into which the
fair value measurements arecategorised:
+------------------------------------+---------+---------+---------+---------+
| | Level | Level | Level | Total |
| | 1 | 2 | 3 | |
+------------------------------------+---------+---------+---------+---------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+------------------------------------+---------+---------+---------+---------+
| Available-for-sale financial | | | | |
| assets | | | | |
+------------------------------------+---------+---------+---------+---------+
| Turquoise Metals and Electricals | - | - | 5,701 | 5,701 |
| Private Limited | | | | |
+------------------------------------+---------+---------+---------+---------+
| Aquamarine Synthetics and | - | - | 4,119 | 4,119 |
| Chemicals Private Limited | | | | |
+------------------------------------+---------+---------+---------+---------+
| Triton Projects India Private | - | - | 573 | 573 |
| Limited | | | | |
+------------------------------------+---------+---------+---------+---------+
| Destination India Projects Private | - | - | 1,047 | 1,047 |
| Limited | | | | |
+------------------------------------+---------+---------+---------+---------+
| Cygnet Projects Private Limited | - | - | 8,551 | 8,551 |
+------------------------------------+---------+---------+---------+---------+
| Lords Choloro Alkali Limited | - | - | 511 | 511 |
+------------------------------------+---------+---------+---------+---------+
| | - | - | 20,502 | 20,502 |
+------------------------------------+---------+---------+---------+---------+
The following table shows a reconciliation from the beginning balances to the
ending balances for fair value measurements in level 3 of the fair value
hierarchy:
+--------+--------+--------+--------+---------+
| | | | | 31 |
| | | | | March |
| | | | | 2010 |
+--------+--------+--------+--------+---------+
| | | | | GBP'000 |
+--------+--------+--------+--------+---------+
| Fair value brought | | 19,296 |
| forward | | |
+--------------------------+--------+---------+
| Additional investment | | 1,251 |
+--------------------------+--------+---------+
| Refund from asset | | (628) |
| reconstruction company | | |
+--------------------------+--------+---------+
| Movement in fair value | | (1,273) |
+--------------------------+--------+---------+
| Effect of foreign | | 1,856 |
| exchange fluctuations | | |
+--------------------------+--------+---------+
| Fair | | | | 20,502 |
| value | | | | |
| at | | | | |
| year | | | | |
| end | | | | |
+--------+--------+--------+--------+---------+
6. Investment management fees
Management fee
Shiva Consultants Private Limited (the "Investment Manager") was entitled to a
management fee of 1.8 per cent per annum of the NAV (payable quarterly in
advance) in the first year and a management fee of 2 per cent per annum of the
NAV (payable quarterly in advance) thereafter, provided that any fee for any
commencing or terminating period shall be the pro-rated amount. The Investment
Manager agreed to reduce the management fee for the year from 2% to 1.5%, and
has agreed to do the same for a further year.
The NAV calculation of each financial year is based on semi-annual independent
valuations of such investments in accordance with IFRS as at the end of the
relevant financial year and at the date which is six months after the relevant
financial year end. Throughout the relevant financial year, the management fee
paid on each quarter date is based on the latest NAV calculation. The
management fee payments are then adjusted retrospectively following the next NAV
calculation.
Annual management fees paid during the year ended 31 March 2010 amounted to
GBP445,588 (2009: GBP649,153) and no fees were outstanding as at 31 March 2010
(2009: GBPnil).
Performance fee
The Investment Manager is entitled to a performance fee, calculated as follows,
in respect of net proceeds received by the relevant member of the Group in
respect of an investment:
· the net investment proceeds will first be allocated to the Group, until
the Group has received an amount equal to the investment outlay and an
investment IRR of 12 per cent.
· any remaining balance of the net investment proceeds will then be
allocated to the Investment Manager until the Investment Manager has received an
amount equal to 25 per cent of the return already allocated to the Group;
· any remaining balance of the net investment proceeds will then be
allocated between the Group and the Investment Manager in the ratio 80:20 up to
an investment IRR of 25 per cent; and
· any remaining balance of the net investment proceeds will then be
allocated between the Group and the Investment Manager in the ratio 65:35.
Due to decrease in the fair value of investments, relative to their cost, no
performance fee has been provided in the financial statements or those for the
year ended 31 March 2009. The performance fee recognised in 2008 was period was
accordingly reversed in 2009.
7. Other administration expenses
+-------------------------------+------+-------------+--+-------------+
| | | Year ended | | Year ended |
| | | 31 March | | 31 March |
| | | 2010 | | 2009 |
+-------------------------------+------+-------------+--+-------------+
| | | GBP'000 | | GBP'000 |
+-------------------------------+------+-------------+--+-------------+
| Professional fees | | 224 | | 317 |
+-------------------------------+------+-------------+--+-------------+
| Directors' fees (note 17) | | 127 | | 133 |
+-------------------------------+------+-------------+--+-------------+
| Administration fees | | 77 | | 76 |
+-------------------------------+------+-------------+--+-------------+
| Nominated and broker fees | | 45 | | 49 |
+-------------------------------+------+-------------+--+-------------+
| Public relations fees | | 13 | | 70 |
+-------------------------------+------+-------------+--+-------------+
| Accounting fees | | 33 | | 6 |
+-------------------------------+------+-------------+--+-------------+
| Audit fees | | 53 | | 58 |
+-------------------------------+------+-------------+--+-------------+
| Other expenses | | 111 | | 68 |
+-------------------------------+------+-------------+--+-------------+
| Total | | 683 | | 777 |
+-------------------------------+------+-------------+--+-------------+
8. Taxation
The standard rate of income tax for companies in the Isle of Man is 0%. No
provision for taxation has, therefore, been made in the Company.
The Mauritian entity is a Global Business License Category 1 (GBL1) company in
Mauritius and under the current laws and regulations is liable to pay income tax
on their net income at a rate of 15%. The entity is however entitled to a tax
credit equivalent to the higher of actual foreign tax suffered and 80% of the
Mauritian tax payable in respect of the foreign source income thus reducing the
maximum effective tax rate to 3%. No Mauritian capital gains tax is payable on
profits arising from the sale of securities, and any dividends and redemption
proceeds paid by the entity to their members will be exempt in Mauritius from
any withholding tax.
The Indian subsidiaries are incorporated for acquiring assets of targeted
companies. As such, the funds remitted by Agate India Investments Limited, are
utilized for acquiring the secured assets of the target companies. Only surplus
funds are held in short-term deposits and short-term liquid mutual funds. The
income earned in the form of interest on deposits is taxable as "Income from
other Sources". The income earned in the form of Dividend on funds invested in
short term liquid mutual funds is exempt from tax as per section 10(23G) of the
Income Tax Act.
For the Assessment year 2010-11, the five Indian subsidiaries - Turquoise Metal
& Electricals Pvt. Ltd., Aquamarine Synthetics & Chemicals Pvt. Ltd., Triton
Projects Private Limited, DestinationIndia Projects Private Limited and Cygnet
Projects Private Limited - do not have taxable income under the Income Tax Act
1961. As such, no income tax is levied on them.
Deferred taxation has beenrecognisedwithin each individual subsidiary on the
basis that the fair valued investments are realised within the subsidiary rather
than as a sale of the shares of the subsidiary.
The actual income tax expense is as follows:
+-------------------------------+------+-------------+--+-------------+
| | | Year ended | | Year ended |
| | | 31 March | | 31 March |
| | | 2010 | | 2009 |
+-------------------------------+------+-------------+--+-------------+
| | | GBP'000 | | GBP'000 |
+-------------------------------+------+-------------+--+-------------+
| Income tax expense | | 48 | | - |
+-------------------------------+------+-------------+--+-------------+
| Deferred tax charge/(credit) | | 190 | | (840) |
+-------------------------------+------+-------------+--+-------------+
| | | 238 | | (840) |
+-------------------------------+------+-------------+--+-------------+
Deferred Taxation
The movement in deferred tax during the year was as follows:
+-------------------------------+------+-------------+--+-------------+
| | | 31 March | | 31 March |
| | | 2010 | | 2009 |
+-------------------------------+------+-------------+--+-------------+
| | | GBP'000 | | GBP'000 |
+-------------------------------+------+-------------+--+-------------+
| Opening balance | | 1,862 | | 2,702 |
+-------------------------------+------+-------------+--+-------------+
| Charge/(credit) for the year | | 190 | | (840) |
+-------------------------------+------+-------------+--+-------------+
| Balance at 31 March | | 2,052 | | 1,862 |
+-------------------------------+------+-------------+--+-------------+
Deferred taxation provided in the financial statements is as follows:
+-------------------------------+------+-------------+--+-------------+
| | | 31 March | | 31 March |
| | | 2010 | | 2009 |
+-------------------------------+------+-------------+--+-------------+
| | | GBP'000 | | GBP'000 |
+-------------------------------+------+-------------+--+-------------+
| Revaluation of available-for-sale | 2,052 | | 1,862 |
| financial assets | | | |
+-------------------------------+------+-------------+--+-------------+
The deferred taxation has been provided at the standard rate for the
subsidiaries of 33.66%. The Company has no deferred taxation.
9. Loss per share
Basic loss per share is calculated by dividing the loss attributable to equity
holders of the Company by the weighted average number of ordinary shares in
issue during the year.
+-----------------------------+-------+-------------+--+-------------+
| | | Year ended | | Year ended |
| | | 31 March | | 31 March |
| | | 2010 | | 2009 |
+-----------------------------+-------+-------------+--+-------------+
| Loss attributable to equity | | | | |
| holders of the Company | | (1,003) | | (1,002) |
| (GBP'000) | | | | |
+-----------------------------+-------+-------------+--+-------------+
| Number of ordinary shares | | 16,666,667 | | 16,666,667 |
| in issue | | | | |
+-----------------------------+-------+-------------+--+-------------+
| Basic loss per share | | (6.02) | | (6.01) |
| (pence) | | | | |
+-----------------------------+-------+-------------+--+-------------+
There is no dilutive earnings per share number shown as there are no share
options in issue and the warrants have expired.
10. Net asset value per share
Net Asset Value (NAV) per share is calculated by dividing the net assets
attributable to equity holders of the Company by the number of ordinary shares
in issue as at 31 March 2010.
+------------------------------+------+--------------+--+-------------+
| | | 31 March | | 31 March |
| | | 2010 | | 2009 |
+------------------------------+------+--------------+--+-------------+
| Net assets attributable to | 21,623 | | 22,160 |
| shareholders (GBP'000) | | | |
+-------------------------------------+--------------+--+-------------+
| Number of ordinary shares in | | 16,666,667 | | 16,666,667 |
| issue | | | | |
+------------------------------+------+--------------+--+-------------+
| Net asset value per share | | 130 | | 133 |
| (pence) | | | | |
+------------------------------+------+--------------+--+-------------+
11. Investments in subsidiaries
For efficient portfolio management purposes, the Company has established the
following subsidiary companies:
+------------------------------------+-----------------+---------------+
| Name | Country of | Ownership |
| | Incorporation | interest |
+------------------------------------+-----------------+---------------+
| Agate India Investments Limited | Mauritius | 100% |
+------------------------------------+-----------------+---------------+
| Turquoise Metal and Electricals | India | 75% |
| Private Limited* | | |
+------------------------------------+-----------------+---------------+
| Aquamarine Synthetics & Chemical | India | 75% |
| Private Limited* | | |
+------------------------------------+-----------------+---------------+
| Triton Project India Private | India | 95% |
| Limited* | | |
+------------------------------------+-----------------+---------------+
| Destination India Projects Private | India | 95% |
| Limited* | | |
+------------------------------------+-----------------+---------------+
| Cygnet Projects Private Limited* | India | 90% |
+------------------------------------+-----------------+---------------+
*Subsidiaries of Agate India Investments Limited
12. Available-for-sale financial assets
Investments in unquoted Indian incorporated investee companies are designated as
available-for-sale financial assets and are carried at fair value in the
statement of financial position. The Group has invested in the debt of
identified distressed companies (secured by way of charges on the assets) with
the intention of acquiring the assets of these companies.
The Group's investments in the underlying investee companies are as follows as
at 31 March 2010:
+-------------+----------+------------+----------+---------+
| Investments | Capital | Fair | Foreign | Fair |
| | invested | value | exchange | value |
| | | adjustment | rate | |
| | | | effect | |
+-------------+----------+------------+----------+---------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-------------+----------+------------+----------+---------+
| Indirect | | | | |
| investments | | | | |
+-------------+----------+------------+----------+---------+
| Turquoise | 1,630 | 3,855 | 216 | 5,701 |
| Metals | | | | |
| and | | | | |
| Electricals | | | | |
| Private | | | | |
| Limited | | | | |
+-------------+----------+------------+----------+---------+
| Aquamarine | 1,612 | 2,232 | 275 | 4,119 |
| Synthetics | | | | |
| and | | | | |
| Chemicals | | | | |
| Private. | | | | |
| Limited | | | | |
+-------------+----------+------------+----------+---------+
| Triton | 1,020 | (608) | 161 | 573 |
| Projects | | | | |
| India | | | | |
| Private | | | | |
| Limited | | | | |
+-------------+----------+------------+----------+---------+
| Destination | 1,592 | (896) | 351 | 1,047 |
| India | | | | |
| Projects | | | | |
| Private | | | | |
| Limited | | | | |
+-------------+----------+------------+----------+---------+
| Cygnet | 10,414 | (3,711) | 1,848 | 8,551 |
| Projects | | | | |
| Private | | | | |
| Limited | | | | |
+-------------+----------+------------+----------+---------+
| | | | | |
+-------------+----------+------------+----------+---------+
| Direct | | | | |
| investments | | | | |
+-------------+----------+------------+----------+---------+
| Lords | 1,108 | (815) | 218 | 511 |
| Choloro | | | | |
| Alkali | | | | |
| Limited | | | | |
+-------------+----------+------------+----------+---------+
| | 17,376 | 57 | 3,069 | 20,502 |
+-------------+----------+------------+----------+---------+
The movements in the fair value of the financial assets held by the above
investee companies are as follows:
+----------------+--------+--------+---------+---------+
| | | | 31 | 31 |
| | | | March | March |
| | | | 2010 | 2009 |
+----------------+--------+--------+---------+---------+
| | | | GBP'000 | GBP'000 |
+----------------+--------+--------+---------+---------+
| Fair | | | 19,296 | 21,779 |
| value | | | | |
| brought | | | | |
| forward | | | | |
+----------------+--------+--------+---------+---------+
| Additional | | | 1,251 | 3,177 |
| investment | | | | |
+----------------+--------+--------+---------+---------+
| Refund | | | (628) | - |
| from | | | | |
| asset | | | | |
| reconstruction | | | | |
| company | | | | |
+----------------+--------+--------+---------+---------+
| Movement | | | (1,273) | (6,750) |
| in fair | | | | |
| value | | | | |
+----------------+--------+--------+---------+---------+
| Effect | | | 1,856 | 1,090 |
| of | | | | |
| foreign | | | | |
| exchange | | | | |
| fluctuations | | | | |
+----------------+--------+--------+---------+---------+
| Fair | | | 20,502 | 19,296 |
| value | | | | |
| at end | | | | |
| of the | | | | |
| year | | | | |
+----------------+--------+--------+---------+---------+
Valuation methodology
The value of the Group's interest in the assets of the underlying investee
companies had been determined by the Directors with the advice of an independent
valuer. The value of the assets of the distressed companies is based on the
Directors' best estimate of a fair value basis in a forced sale scenario.
Physical assets of the distressed companies, against which the debts are
secured, are valued by independent valuers and the fair value is discounted at
appropriate rates taking into account costs to dispose the assets and time
ofrealisation of the assets. Statutory liabilities which have a preference over
secured debt, and resolution costs of between 1% and 10% (based on the valuer's
opinion of the asset) of realisable value are deducted from therealisable value.
Discounts are also applied based on the level of aggregation of debt achieved.
The investment in Lords Choloro Alkali Limited has been valued based on the
lowest mid-market share price quoted in the period from 31 March 2010 to the
date of agreement of the valuations by the Directors on 26 July 2010.The lowest
mid-market share price during the period was INR23.1 per share on 11 June 2010.
13. Trade and other receivables
+---------------------------+-----------+---------+----------+---------+
| | Group | Company | Group | Company |
+---------------------------+-----------+---------+----------+---------+
| | 31 March | 31 | 31 March | 31 |
| | 2010 | March | | March |
| | | 2010 | 2009 | 2009 |
+---------------------------+-----------+---------+----------+---------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------------------+-----------+---------+----------+---------+
| Loan to subsidiary | - | - | - | 2 |
+---------------------------+-----------+---------+----------+---------+
| Prepayments and accrued | 56 | 6 | 152 | 7 |
| income | | | | |
+---------------------------+-----------+---------+----------+---------+
| | 56 | 6 | 152 | 9 |
+---------------------------+-----------+---------+----------+---------+
14. Cash and cash equivalents
+---------------------------+-----------+---------+----------+---------+
| | Group | Company | Group | Company |
+---------------------------+-----------+---------+----------+---------+
| | 31 March | 31 | 31 March | 31 |
| | 2010 | March | | March |
| | | 2010 | 2009 | 2009 |
+---------------------------+-----------+---------+----------+---------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------------------+-----------+---------+----------+---------+
| Bank balances | 909 | 99 | 2,444 | 177 |
+---------------------------+-----------+---------+----------+---------+
| Short-term deposits | 5,395 | 1,001 | 4,964 | 942 |
+---------------------------+-----------+---------+----------+---------+
| Cash and cash equivalents | 6,304 | 1,100 | 7,408 | 1,119 |
+---------------------------+-----------+---------+----------+---------+
15. Share capital
+------------------------------------+------------+----------+-----------+
| | No. of | Share | Share |
| | shares | capital | premium |
+------------------------------------+------------+----------+-----------+
| | | GBP'000 | GBP'000 |
+------------------------------------+------------+----------+-----------+
| Ordinary shares of GBP 0.10 each | 16,666,667 | 1,667 | 21,355 |
+------------------------------------+------------+----------+-----------+
| | 16,666,667 | 1,667 | 21,355 |
+------------------------------------+------------+----------+-----------+
The authorised share capital of the Company is GBP10,000,000, divided into
100,000,000 Ordinary Shares of GBP0.10 each. The holders of Ordinary Shares are
entitled to receive dividends as declared from time to time and are entitled to
one vote per share at meetings of the Company. All shares rank equally with
regard to the Company's assets.
Warrants originally issued expired on 12 July 2009.
16. Trade and other payables
+---------------------------+-----------+---------+----------+---------+
| | Group | Company | Group | Company |
+---------------------------+-----------+---------+----------+---------+
| | 31 March | 31 | 31 March | 31 |
| | 2010 | March | | March |
| | | 2010 | 2009 | 2009 |
+---------------------------+-----------+---------+----------+---------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------------------+-----------+---------+----------+---------+
| Trade payables | 128 | 35 | 145 | 11 |
+---------------------------+-----------+---------+----------+---------+
| Accruals | 40 | 76 | 15 | 44 |
+---------------------------+-----------+---------+----------+---------+
| | 168 | 111 | 160 | 55 |
+---------------------------+-----------+---------+----------+---------+
17. Directors' remuneration
Details of the Directors' annual remuneration are as follows:
+--------------------+--------------------+--------------+-------------+
| Name of Director | Fee for Dhir India | Directorship | Total |
| | Investments plc | fee as | |
| | | member of | |
| | | audit | |
| | | committee | |
+--------------------+--------------------+--------------+-------------+
| | GBP | GBP | GBP |
+--------------------+--------------------+--------------+-------------+
| C E Hambro | 30,000 | - | 30,000 |
+--------------------+--------------------+--------------+-------------+
| A Singh | 28,172 | 5,781 | 33,953 |
+--------------------+--------------------+--------------+-------------+
| J Bourbon | 28,907 | 5,781 | 34,688 |
+--------------------+--------------------+--------------+-------------+
| M Y Khan | 25,000 | - | 25,000 |
+--------------------+--------------------+--------------+-------------+
| Total | 112,079 | 11,562 | 123,641 |
+--------------------+--------------------+--------------+-------------+
The Directors are each entitled to receive reimbursement of any expenses in
relation to their appointment. Total fees paid to the Directors for the year
ended 31 March 2010 is GBP126,790 (2009: GBP132,784).
18. Related party transactions
Management arrangement
Alok Dhir and his associates are the significant shareholders of Shiva
Consultants Private Limited (the Investment Manager) and a Director of Dhir
India Investments plc. The management fee and performance fee arrangements are
set out in note 6.
Legal services
Alok Dhir is also one of the partners of Dhir & Dhir Associates, the Company's
lawyers in India. During the year the Company used the legal services of Dhir &
Dhir Associates and incurred the following charges:
+---------------------------------------+-------------+--+------------+
| | Year ended | | Year ended |
| | 31 March | | 31 March |
| | 2010 | | 2009 |
+---------------------------------------+-------------+--+------------+
| | GBP'000 | | GBP'000 |
+---------------------------------------+-------------+--+------------+
| Legal and professional fees | 23 | | 113 |
+---------------------------------------+-------------+--+------------+
| Balance outstanding as at 31 March | 21 | | 36 |
+---------------------------------------+-------------+--+------------+
Amounts were billed based on normal market rates for such services and were due
and payable under normal payment terms.
Save as disclosed above, none of the Directors had any interest during the year
in any material contract for the provision of services which was significant to
the business of the Company.
Alchemist Asset Reconstruction Company Limited (formerly Dhir & Dhir Asset
Reconstruction andSecuritisation Company Limited)
One of the Directors of the Company, Alok Dhir, is also a director of Alchemist
Asset Reconstruction Company Limited ("AARCL"). The SPVs have entered into
transactions with AARCL for acquisition of various assets/units in respect of
the companies in which investments have been made. The details of outstanding
balance of advances made by the SPVs to AARCL are as below:
+---------------------------------------+-------------+--+------------+
| | 31 March | | 31 March |
| | 2010 | | 2009 |
+---------------------------------------+-------------+--+------------+
| | GBP'000 | | GBP'000 |
+---------------------------------------+-------------+--+------------+
| Turquoise Metals and Electrical | 1,846 | | 1,689 |
| Private Limited | | | |
+---------------------------------------+-------------+--+------------+
| Aquamarine Synthetics and Chemicals | 427 | | 391 |
| Private Limited | | | |
+---------------------------------------+-------------+--+------------+
| Triton Projects India Private Limited | 71 | | 65 |
+---------------------------------------+-------------+--+------------+
| Destination India Projects Private | - | | 646 |
| Limited | | | |
+---------------------------------------+-------------+--+------------+
| Cygnet Projects Private Limited | 2,873 | | 2,616 |
+---------------------------------------+-------------+--+------------+
| Total | 5,217 | | 5,407 |
+---------------------------------------+-------------+--+------------+
Co-investment
During the year to 31 March 2010, Alok Dhir has in terms of the co-investment
commitments along with Turnaround Consultants Private Limited and Sopan
Securities Private Limited, which are some of his connected persons, co-invested
with the Group's subsidiary Agate India Investments Limited in the following
Group SPVs subsidiaries:
+---------------------------------------+-------------+--+------------+
| | Equity | | Investment |
| | Holding (%) | | GBP'000 |
+---------------------------------------+-------------+--+------------+
| Turquoise Metals and Electrical | 25% | | 510.79 |
| Private Limited | | | |
+---------------------------------------+-------------+--+------------+
| Aquamarine Synthetics and Chemicals | 25% | | 572.43 |
| Private Limited | | | |
+---------------------------------------+-------------+--+------------+
| Triton Projects India Private Limited | 5% | | 64.28 |
+---------------------------------------+-------------+--+------------+
| Destination India Projects Private | 5% | | 112.95 |
| Limited | | | |
+---------------------------------------+-------------+--+------------+
| Cygnet Projects Private Limited | 10% | | 913.30 |
+---------------------------------------+-------------+--+------------+
Lords Chloro Alkali Limited
Alok Dhir is also a shareholder in Lords Chloro Alkali Limited. As at 31 March
2010, the Group has subscribed for 1.5 million equity shares at INR 60 per share
in Lords Chloro Alkali Limited (see note 12).
19. Exchange rates
The following exchange rates were used to translate assets and liabilities into
the reporting currency at 31 March 2010:
+---------------------------+-----------+----------+----------+----------+
| | 2010 | 2010 | 2009 | 2009 |
+---------------------------+-----------+----------+----------+----------+
| | Closing | Average | Closing | Average |
| | rate | rate | rate | rate |
+---------------------------+-----------+----------+----------+----------+
| UK Sterling : Indian | 67.8685 | 76.19825 | 74.1579 | 79.13275 |
| Rupee | | | | |
+---------------------------+-----------+----------+----------+----------+
20. Financial risk management
The Group's activities expose it to a variety of financial risks: market risk
(including market price risk, foreign currency risk and interest rate risk),
credit risk and liquidity risk. This note presents information about the
Group's exposure to each of the above risks and the Group's objectives, policies
and processes for measuring and managing risk.
The Board of Directors has overall responsibility for the establishment and
oversight of the Group's risk management framework.
The Group's risk management policies are established to identify and analyse the
risks faced by the Group, to set appropriate risk limits and controls, and to
monitor risks and adherence to limits. Risk management policies and systems are
reviewed regularly to reflect changes in market conditions and the Group's
activities. The Group Audit Committee oversees how management monitors
compliance with the Group's risk management policies and procedures and reviews
the adequacy of the risk management framework in relation to the risks faced by
the Group.
Market risk
Market risk embodies the potential for both losses and gains and includes
currency risk, interest risk and price risk. The Group invests in the distressed
debt of unquoted companies. The Group's strategy on the management of market
risk is driven by its investment objective as outlined in the Investment
Manager's report.
Price risk
The Group invests in a range of investments including unquoted equity securities
and secured debt in a range of sectors. The Board monitors the Group's
investment exposure against internal guidelines specifying the proportion of
total assets that may be invested in various sectors. Investments in such
companies are inherently difficult to value.
Currency risk
The Groups' operations are conducted in jurisdictions which generate revenue,
expenses, assets and liabilities in currencies other than Sterling. As a
result, the Group is subject to the effects of exchange rate fluctuations with
respect to these currencies. The currency giving rise to this risk is primarily
Indian Rupee.
An analysis of net assets by currency exposure is as follows:
+---------------------------------------+-------------+--+------------+
| | 31 March | | 31 March |
| | 2010 | | 2009 |
+---------------------------------------+-------------+--+------------+
| | GBP'000 | | GBP'000 |
+---------------------------------------+-------------+--+------------+
| UK Sterling | 1,983 | | 1,073 |
+---------------------------------------+-------------+--+------------+
| India Rupee | 22,659 | | 23,761 |
+---------------------------------------+-------------+--+------------+
| | 24,642 | | 24,834 |
+---------------------------------------+-------------+--+------------+
The Group's exposure to foreign currency risk was as follows based on notional
amounts:
+---------------------------------------+-------------+--+------------+
| | 31 March | | 31 March |
| | 2010 | | 2009 |
+---------------------------------------+-------------+--+------------+
| | GBP'000 | | GBP'000 |
+---------------------------------------+-------------+--+------------+
| Available-for-sale financial assets | 20,502 | | 19,296 |
+---------------------------------------+-------------+--+------------+
| Trade and other receivables | 49 | | 143 |
+---------------------------------------+-------------+--+------------+
| Cash and cash equivalents | 4,189 | | 6,289 |
+---------------------------------------+-------------+--+------------+
| Trade and other payables | (29) | | (105) |
+---------------------------------------+-------------+--+------------+
| Provisions for other liabilities | (2,052) | | (1,862) |
+---------------------------------------+-------------+--+------------+
| Net balance sheet exposure | 22,659 | | 23,761 |
+---------------------------------------+-------------+--+------------+
The significant exchange rates applied during the year are shown in note 19.
A 10 percent strengthening / weakening of Sterling against the following
currencies at 31 March would have increased / (decreased) equity and profit or
loss by the amounts shown below. This analysis assumes that all other variables,
in particular interest rates, remain constant.
+---------------------------------------+-------------+--+------------+
| | Profit | | Equity |
+---------------------------------------+-------------+--+------------+
| | GBP'000 | | GBP'000 |
+---------------------------------------+-------------+--+------------+
| 31 March 2009: INR | 90 | | 2,160 |
+---------------------------------------+-------------+--+------------+
| 31 March 2010: INR | 9 | | 2,266 |
+---------------------------------------+-------------+--+------------+
Interest rate risk
The Company is exposed to risks associated with the effects of fluctuations in
prevailing market interest rates on its cash balances. Cash is invested at
short-term market interest rates.
At the reporting date the interest rate profile of the Group's interest-bearing
financial instruments was:
+---------------------------------------+-------------+--+------------+
| | 31 March | | 31 March |
| | 2010 | | 2009 |
+---------------------------------------+-------------+--+------------+
| | GBP'000 | | GBP'000 |
+---------------------------------------+-------------+--+------------+
| Variable rate instruments | | | |
+---------------------------------------+-------------+--+------------+
| Financial assets | 6,304 | | 7,408 |
+---------------------------------------+-------------+--+------------+
The Group does not account for any fixed rate financial assets and liabilities
at fair value through profit or loss, and the Group does not designate
derivatives (interest rate swaps) as hedging instruments under a fair value
hedge accounting model. Therefore a change in interest rates at the reporting
date would not affect profit or loss.
A change of 100 basis points in interest rates would
have increased or decreased equity by GBP63,000 (2009: GBP74,000).
Credit risk
The maximum exposure to credit risk is represented by the carrying amount of
each financial asset in the balance sheet. Management does not expect any
counterparty to fail to meet its obligations.
The carrying amount of financial assets represents the maximum credit exposure.
The maximum exposure to credit risk at the reporting date was:
+---------------------------------------+-------------+--+------------+
| | Carrying amount |
+---------------------------------------+-----------------------------+
| | 31 March | | 31 March |
| | 2010 | | 2009 |
+---------------------------------------+-------------+--+------------+
| | GBP'000 | | GBP'000 |
+---------------------------------------+-------------+--+------------+
| Available-for-sale financial assets | 20,502 | | 19,296 |
| at fair value | | | |
+---------------------------------------+-------------+--+------------+
| Trade and other receivables | 56 | | 152 |
+---------------------------------------+-------------+--+------------+
| Cash and cash equivalents | 6,304 | | 7,408 |
+---------------------------------------+-------------+--+------------+
| Total | 26,862 | | 26,856 |
+---------------------------------------+-------------+--+------------+
There was no significant concentration of credit risk at 31 March 2009.
Liquidity risk
The Group maintains sufficient cash balances for working capital, and had no
financial liabilities other than trade payables and provisions for liabilities
and charges. The Group had no derivative financial liabilities. The contractual
cash flows are considered to be due within six months and equal to their
carrying amount.
Fair values
All assets and liabilities at 31 March 2010 are considered to be stated at fair
value.
Capital Management
The Board's policy is to maintain a strong capital base. Group capital comprises
share capital and reserves.
There has been no change in the Groups approach to capital management in the
year. Neither the Company nor any of its subsidiaries are subject to any
externally forced capital requirements.
21. Capital commitment
As at 31 March 2010 the Company had committed a total of GBP24.08million (2009:
GBP24.08million) representing full investment of the funds raised in the Placing
associated with Admission to AIM in July 2007. The Capital Commitment as at 31
March 2010 is therefore GBP6.70million (2009: GBP6.77million).
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR KKPDBABKDCFK
1 Year Dhir India Chart |
1 Month Dhir India Chart |
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
