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நிறுவன பெயரின் முதல் சில எழுத்துக்களை நிரப்பி 'கோ' பட்டனை கிளிக் செய்யவும்

Adani Ports & Special Economic Zone Ltd. இன் கணக்கு குறிப்புகள்

Mar 31, 2018

2.3 Significant accounting judgments, estimates and assumptions

The preparation of the Company''s Ind AS Financial Statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

Impairment of non-financial assets

Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount, which is the higher of its fair value less costs of disposal and its value in use. The fair value less costs of disposal calculation is based on available data for similar assets or observable market prices less incremental costs for disposing of the asset. The value in use calculation is based on a DCF model. The cash flows are derived from the budget for the next five years and do not include restructuring activities that the Company is not yet committed to or significant future investments that will enhance the asset''s performance being tested. The recoverable amount is sensitive to the discount rate used for the DCF model as well as the expected future cash-inflows and the growth rate used for extrapolation purposes. These estimates are most relevant to goodwill with indefinite useful lives recognized by the Company. The key assumptions used to determine the recoverable amount for the CGU, are disclosed and further explained in note 3(d).

Impairment of financial assets

The impairment provisions for Financial Assets are based on assumptions about risk of default and expected cash loss. The Company uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on Company''s past history, existing market conditions as well as forward looking estimates at the end of each reporting period. Refer note 4(c).

Taxes

Deferred tax (including MAT credits) assets are recognized for unused tax credits to the extent that it is probable that taxable profit will be available against which the credits can be utilized. Significant management judgment is required to determine the amount of deferred tax assets that can be recognized, based upon the likely timing and the level of future taxable profits together with future tax planning strategies. Further details on taxes are disclosed in note 26.

Defined benefit plans (gratuity benefits)

The cost of the defined benefit gratuity plan and the present value of the gratuity obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

The parameter most subject to change is the discount rate. In determining the appropriate discount rate for plans operated in India, the management considers the interest rates of government bonds in currencies consistent with the currencies of the post-employment benefit obligation. The underlying bonds are further reviewed for quality. Those having excessive credit spreads are excluded from the analysis of bonds on which the discount rate is based, on the basis that they do not represent high quality corporate bonds.

The mortality rate is based on publicly available mortality tables for the specific countries. Those mortality tables tend to change only at interval in response to demographic changes. Future salary increases and gratuity increases are based on expected future inflation rates for the respective countries.

Further details about gratuity obligations are given in note 29.

Fair value measurement of financial instruments

In estimating the fair value of financial assets and financial liabilities, the Company uses market observable data to the extent available. Where such Level 1 inputs are not available, the Company establishes appropriate valuation techniques and inputs to the model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgment is required in establishing fair values. Judgments include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments. Refer note 33 for further disclosures.

Provision for Decommissioning Liabilities

The management of the Company has estimated that there is no contractual and probable decommissioning liability under the condition / terms of the concession agreement with the GMB.

Depreciation / amortization and useful lives of property plant and equipment / intangible assets

Property, plant and equipment / intangible assets are depreciated / amortized over their estimated useful lives, after taking into account estimated residual value. Management reviews the estimated useful lives and residual values of the assets annually in order to determine the amount of depreciation / amortization to be recorded during any reporting period. The useful lives and residual values are based on the Company''s historical experience with similar assets and take into account anticipated technological changes. The depreciation / amortization for future periods is revised if there are significant changes from previous estimates.

v) As a part of concession agreement for development of port and related infrastructure at Mundra the Company has been allotted land on lease basis by Gujarat Maritime Board (GMB). The Company has recorded rights in the GMB Land at present value of future annual lease payments in the books and classified the same as lease hold land.

vi) Land development cost on leasehold land includes costs incurred towards reclaimed land of Rs, 182.96 crore (previous year Rs, 190.82 crore). The cost has been estimated by the management, being cost allocated out of the dredging activities approximate the actual cost.

vii) Reclaimed land measuring 1,112.80 hectare are pending to be registered in the name of the Company.

viii) Project Assets includes dredgers and earth moving equipments.

ix) Free Hold Land includes Land given on Operating Lease Basis:

Gross Block as at March 31, 2018 - Rs, 6.71 crore (previous year - Rs, 6.71 crore)

Accumulated Depreciation as at March 31, 2018: Rs, 0.24 crore (previous year - Rs, 0.12 crore)

Net Block as at March 31, 2018 - Rs, 6.47 crore (previous year - Rs, 6.59 crore)

x) Refer footnote to note 14 and 17 for security / charges created on property, plant and equipment.

Goodwill acquired through business combination pertains to cash generating units (CGUs) which are part of ''Port and SEZ'' activities segment. The goodwill is tested for impairment annually . As at March 31, 2018 and March 31, 2017, the goodwill is not impaired.

The recoverable amount of the CGUs are determined from value-in-use calculation. The key assumptions for the value-in-use calculations are those regarding the discount rate, growth rates and expected changes to direct costs during the year. Management estimates discount rate using pre-tax rates that reflect current market assessments of the time value of money.

The growth rate are based on management''s forecasts. Changes in selling prices and direct costs are based on past practices and expectations of future changes in the market.

The Company prepares its forecasts based on the most recent financial budget approved by management with projected revenue growth rates ranging from 6% to 20 % the rate used to discount the forecast is 7.5% p.a.

The management believe that any reasonable possible change in any these assumptions would not cause the carrying amount to exceed its recoverable amount.

c) (i) Adani Vizag Coal Terminal Private Limited ("AVCTPL")

- a subsidiary of the Company is engaged in Port services under concession from one of the port trust authorities of the Government of India. The port operations have been suspended since January 2016 due to operational bottlenecks, for which the management of subsidiary company has made representations to the port authorities and Ministry of Shipping for early resolution so as to resume operations expeditiously. The management of the subsidiary company has expressed its inability to operate the terminal on account of various external factors beyond the subsidiary company''s control. Under the circumstances, continuance of the terminal in its present form does not appear to be a viable option and the subsidiary company''s management has requested the port trust authority to take further action including terminating the concession agreement. During the year, APSEZL has assessed the impact of these factors on the appropriateness of the carrying values of investments and loans in AVCTPL. AVCTPL expect to recover Rs, 203.60 crore from concession authority on termination of the contract, in accordance with contact terms, subject to completion of necessary procedures related to the termination. Out of this, the Company expects to recover Rs, 93.60 crore. The total investment and loan advanced to AVCTPL comes to Rs, 390.70 crore. Considering the net amount recoverable from AVCTPL, the Company has recorded impairment amounting to Rs, 297.38 crore (Rs, 228.85 crore net of tax) towards the carrying values of its equity investments and outstanding loans based on best estimates by the management.

(ii) The carrying amounts of long-term investments

in equity shares of wholly owned subsidiary

companies viz. Adani Kandla Bulk Terminal Private Limited ("AKBTPL”) and Adani Murmugao Port Terminal Private Limited ("AMPTPL") is Rs, 235.94 crore as at March 31, 2018 and long term loans include loans given to AKBTPL and AMPTPL aggregating to Rs, 1,559.25 crore as at March 31, 2018. The said subsidiary companies have incurred losses in the recent years and the negative net worth of these companies is Rs, 265.71 crore.

The Company has determined the recoverable amounts of its investments and loans in these subsidiaries as at March 31, 2018. The said determination requires significant estimates & judgements to be made by the management with respect to cargo traffic, port tariffs, inflation, discount rates, etc which are considered reasonable by the Management. On a careful evaluation of the aforesaid factors, the Company''s management has concluded that no provision for impairment in respect of such investments and loans is considered necessary at this stage.

d) During the previous year, the Company has accounted for purchase of 3,12,13,000 numbers of equity shares in Adani Kandla Bulk Terminal Private Limited at consideration of Rs, 31.21 crore. The

equity shares has been purchased from the Adani Enterprises Limited, a group company whereby this entity have become wholly owned subsidiary. As per the management, the transfer has been recorded based on Irrevocable Letter of Affirmation dated March 31, 2017 from the seller and acceptance by the Company although legal transfer of equity share of Adani Kandla Bulk Terminal Private Limited is still in process at year end.

a) No trade or other receivable are due from directors or other officers of the Company either severally or jointly with any other person nor any trade or other receivable are due from firms or private companies in which any director is a partner, a director or a member.

b) Generally, as per credit terms trade receivable are collectable within 30-180 days although the Company provide extended credit period with interest between 8% to 15% considering business and commercial arrangements with the customers including with the related parties. Receivable of Rs, 2.54 crore (previous year Rs, 7.91 crore) are contractually collectable on deferred basis.

c) The Carrying amounts of the trade receivables include receivables amounting to Rs, 713.97 crore (previous year Rs, 663.48 crore) which are subject to a bills discounting arrangement. Under this arrangement, the Company has transferred the relevant receivables to the bank / financial institution in exchange of cash and is prevented from selling or pledging the receivables. The Cost of bill discounting is to the customer''s account as per the arrangement. However, the Company has retained late payment and credit risk. The Company therefore continues to recognize the transferred assets in their entirety in its balance sheet. The amount repayable under the bills discounting arrangement is presented as unsecured borrowing in note 17.

d) Trade receivables include receivables arising from services provided to power companies which are passing through a difficult external environment causing certain delays in payment.

The Company has reviewed these receivables and considering the improving market conditions in the power sector, expects that the power companies will improve their operating effectiveness and recover past dues from Discoms and thereby the Company believes that the amount is good and recoverable.

Loans to others include inter-corporate deposits aggregating ? 1,105.40 crore (previous year Rs, 1,345.14 crore) (Including renewals on due dates) to third parties. These deposits are given at prevailing market interest rates. The inter-corporate deposits have been approved by the Finance committee of the Board of Directors.

The Company has received adequate undertaking on record by its promoters'' company to safeguard the full recovery of this amount together with the interest. In the opinion of the Company, all these loans /deposits are considered good and realizable as at the year end.

Notes:

a) Capital advances includes Rs, 63.57 crore (previous year Rs, 79.10 crore) paid to various private parties and government authorities towards purchase of land.

b) The Company has received bank guarantees of Rs, Nil (previous year Rs, 1.66 crore) against capital advances.

Terms/rights attached to equity shares

(i) The Company has only one class of equity share having par value of Rs, 2 per share. Each holder of equity share is entitled to one vote per share. The Company declares and pays dividends in Indian Rupees.

(ii) In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares

held by the shareholders.

Terms of Non-cumulative redeemable preference shares

(i) The Company has outstanding 28,11,037 0.01 % Non-Cumulative Redeemable Preference Shares (''NCRPS'') of Rs, 10 each issued at a premium of Rs, 990 per share. Each holder of preference shares has a right to vote only on resolutions placed before the company which directly affects the right attached to preference share holders. These shares are redeemable on March 28, 2024 at an aggregate premium of Rs, 278.29 crore (equivalent to Rs, 990.00 per share).

In the event of liquidation of the Company, before redemption the holder of NCRPS will have priority over equity shares in the payment of dividend and repayment of capital. The preference shares carry fixed dividend which is non-discretionary.

(ii) Under Indian GAAP, the preference shares were classified as equity and dividend payable thereon was treated as distribution

of profit. Under Ind AS, the Preference Shares issued by the company classifies as Compound Financial Instrument. These preference shares are separated into liability and equity components based on the terms of the contract. Interest on liability component is recognized as interest expense using the effective interest method.

(iii) The equity component of preference shares includes the securities premium amount received on issue of preference

shares and the preference share capital, redemption premium reserve being created in compliance of the Companies Act, 2013.

Notes:

a) Debentures include Secured Non-Convertible Redeemable Debentures amounting to Rs, 2,090.34 crore (previous year Rs, 2,410.15 crore) which are secured by first Pari-passu charge on all the immovable and movable assets of Multipurpose Terminal, Terminal-II and Container Terminal -II project assets.

b) Debentures include Secured Non-Convertible Redeemable Debentures aggregating to Rs, 49.13 crore (previous year Rs, 93.68 crore) which are secured by exclusive mortgage and charge on entire Single Point Mooring (SPM) facilities serving Indian Oil Corporation Limited - Mundra and the first charge over receivables from Indian Oil Corporation Limited.

c) Debentures include Secured Non-Convertible Redeemable Debentures aggregating to Rs, 1,750.96 crore (previous year '' 1,750.06 crore) which are secured by first pari-passu charge on all the movable and immovable assets pertaining to coal terminal project assets at Wandh.

d) Debentures include Secured Non-Convertible Redeemable Debentures aggregating to t 1,300.00 crore (previous year

Rs, 1,300.00 crore) which are secured by first pari-passu charge on specified assets of certain subsidiary companies

arrangements as per Debenture Trust Deed.

e) Debentures include Secured Non-Convertible Redeemable Debentures aggregating to Rs, 1,582.84 crore (previous

year Rs, Nil) which are secured by first pari-passu charge on specified assets of one of the subsidiary companies arrangements as per Debenture Trust Deed.

f) Foreign currency loan aggregating to Rs, 160.66 crore (previous year Rs, 168.38 crore ) carries interest @ 6 months Euribor plus 95 basis point. The above loan is repayable in 9 Semi-annual instalment of Rs, 17.85 crore from the balance sheet date. The loan is secured by exclusive charge on the Dredgers procured under the facility.

g) Foreign currency loan aggregating to Rs, 70.04 crore (previous year Rs, 75.13 crore ) carries interest @ 6 months Euribor plus 75 basis point. The loan is repayable in 8 semi annually equal installments of approx. Rs, 8.79 crore from the balance sheet date. The loan is secured by exclusive charge on the Cranes purchased under the facility.

h) Foreign currency loan aggregating to Rs, Nil (previous year Rs, 878.22 crore) carried interest @ 6 month labor plus 180 basis point. This loan was secured by first pari-passu charge on all the immovable and movable assets of Multi-purpose Terminal, Terminal-II and Container

Terminal-II project assets. The loan was repaid during the year.

i) Foreign currency letters of credit aggregating to Rs, 570.39 crore (previous year Rs, 555.11 crore) carries interest @ 3 to 6 months libor plus basis point in range of 21 to 46. Loan of Rs, 570.39 crore (previous year Rs, 555.11 crore) payable on maturity in 2019-20 and 2020-21. The loan was secured against exclusive charge on assets purchased under the facility.

j) Unsecured Loan

(i) 5 years Foreign Currency Bond of USD 650 million equivalent to Rs, 4,236.38 crore (previous year Rs, 4,215.25 crore) carries interest @ 3.50 % p.a. with bullet repayment in the year 2020.

(ii) 5 years Foreign Currency Bond of USD 500 million equivalent to Rs, 3,230.33 crore (previous year Rs, 3,207.56 crore) carries interest rate at 3.95% p.a.

with bullet repayment in the year 2022.

(iii) 10 years Foreign Currency Bond of USD 500 million equivalent to Rs, 3,203.06 crore (previous year Rs, Nil) carries interest rate at 4.00% p.a. with bullet repayment in the year 2027.

(iv) Foreign Currency loan of Rs, Nil (previous year Rs, 226.98 crore) carried basis overnight libor plus 120 basis point repaid during the year.

(v) Foreign Currency Loan aggregating to Rs, 1,039.87 crore (previous year Rs, 1,034.68 crore) carries interest at 2.85% fixed for 18 months and than after 6 months Libor plus 2.2% is repayable in the year 2021.

(vi) Foreign Currency Loan aggregating of Rs, Nil (previous year Rs, 12.31 crore) carry interest at 2.12 % p.a. The said loan was repaid during the year.

(vii) Foreign currency letters of credit aggregating to Rs, 23.42 crore (previous year Rs, 31.47 crore) carries interest @ 6 months Libor plus basis point in range of 21 to 51 and 12 months Euribor plus 75 basis points. Rs, 23.42 crore payable on maturity from 2019-20 to 2020-21.

(viii) Foreign currency loan aggregating to Rs, Nil (previous year Rs, 483.45 crore) carried interest 6 months Libor

plus 204 basis point .The loan was repaid during the year 2017-18.

(ix) Foreign currency loan aggregating to Rs, Nil (previous year Rs, 483.23 crore) carried interest @ 3 months

Libor plus 200 basis point. The loan was repaid during the year 2017-18.

(x) Rupee Term Loan aggregating to Rs, 4.86 crore (previous year Rs, Nil) carries interest ranging from 4.70 % p.a. to 7.95 % p.a. repayment beginning from May 2018 and having last repayment date on November 2021.

a) Assets taken under Finance Leases - Land for purposes of developing, constructing, operating and maintaining the

Mundra Port and related infrastructure for providing services to the users in accordance with the terms of the concession agreement with Gujarat Maritime Board (GMB).

The lease rent is subject to revision every three years on April 01st by 20% of the previous amount. The lease rent terms are for the period of 30 years and are renewable accordingly with extention or renewal of the concession agreement. The lease agreement entered is non-cancellable till the termination or expiry of the concession agreement. There is no contingent rent, no sub-leases restrictions imposed by the lease arrangements. Expenses of Rs, 0.59 crore (previous year Rs, 0.59 crore)

incurred under such lease have been expensed in the statement of profit and loss.

b) Disclosure with regards to Amendments to Ind AS 7 Statement of Cash Flows:

The amendments require entities to provide disclosure of changes in their liabilities arising from financing activities, including

both changes arising from cash flows and non-cash changes (such as foreign exchange gains or losses). The Company has provided the information for current period.

a) Suppliers bills accepted under foreign currency letters of credit aggregating to Rs, Nil (previous year Rs, 2.47 crore) carried interest at 1 -12 months Libor plus basis point in the range of 15 to 75 and 6 to 12 Months Euribor plus basis point in range of 38 to 40. The loan was repaid on maturity during the year. The loan was secured against material purchased under the facilities.

b) Suppliers bills accepted under foreign currency letters of credit aggregating to Rs, 1.17 crore (previous year Rs, Nil) carries interest at 6 Months Euribor plus 28 basis point. Subservient charge on movable fixed assets and current assets of the Company, except those secured by exclusive charge in favour of other lenders.

c) Commercial Paper (CP) aggregating Rs, Nil (previous year Rs, 2,531.42 crore) carried interest rate in range of 6.75% p.a. to 10%

p.a. The CP had maturity period of 1 to 9 months and matured during the year.

d) Factored receivables of ? 713.97 crore (previous year Rs, 663.48 crore) have recourse to the Company and interest liability on amount of bill discounted is borne by the customer. The maturity period of the transfer is 1 to 12 months.

Note: Operational Claims are the expected claims against outstanding receivables made/to be made by the customers towards

shortages of stock, handling losses, damages to the cargo, storage and other disputes. The probability and the timing of the outflow/adjustment with regard to above depends on the ultimate settlement / conclusion with the respective customer.

a) Land lease income includes annual income of Rs, 52.01 crore (previous year Rs, 43.77 crore) in respect of land finance lease transaction.

b) Income from Port Operations for the year ended March 31, 2018 includes income of Rs, Nil (previous year Rs, 192.70 crore) towards project related advisory services rendered for the development of Container Terminal Project at Mundra. The income has been recognized based on completion of performance obligation as per the arrangement / agreement entered between the Company, Joint Ventures and the Service Provider. The Container Terminal facilities are developed in Joint ventures.

c) Assets given under Finance Leases - The company has given land on finance lease to various parties. All leases include a clause to enable upward revision of the rental charge every three to five years by 10% to 20%. These leases have terms of between 14 and 50 years. The lease agreements entered are non-cancellable. There is no contingent rent, no subleases and no restrictions imposed by the lease arrangements. The company has also received one-time income of upfront premium ranging from Rs, 625 to Rs, 5,273 per sq. mtr for use of common infrastructure by the parties. Such one-time income of upfront premium is non-refundable. Income of Rs, 537.67 crore (previous year Rs, 267.45 crore) including upfront premium of Rs, 296.33 crore (previous year Rs, 193.46 crore) accrued under such lease have been booked as income in the statement of profit and loss.

d) Land given on operating lease:

The Company has given certain land portions on operating lease. These lease arrangements range for a period between 5 and 60 years and include both cancellable and non-cancellable leases. Most of the leases are renewable for further period on mutually agreeable terms.

Notes:

a) Assets taken under Operating Leases -

An office space and residential houses for staff accommodation are generally obtained on operating leases except that stated under note (b) below. The lease rent terms are generally for an eleven months period and are renewable by mutual agreement. There are no sub-leases and leases are cancellable in nature except that mentioned under note (b) below.

There are no restrictions imposed by the lease arrangements. There is no contingent rent in the lease agreements and there is no escalation clause in the lease agreements except that mentioned under note (b) below. Expenses of Rs, 4.21 crore (previous year Rs, 4.24 crore) incurred under such leases have been expensed in the statement of profit & loss.

b) Assets taken under Operating Leases -

An office premises have been taken on operating leases. The lease rent terms are for the period of 15 years and are renewable by mutual consent. The Company has given deposit of Rs, 100 crore as per the terms in one of the lease transaction. The lease agreement entered is non-cancellable for the period of first 3 years of the lease agreement. As per the lease agreement lease rental is escalated by 10% at every 5 years. There is no contingent rent, no sub-leases and no restrictions imposed by the lease arrangements. Expenses of Rs, 0.05 crore (previous year Rs, 0.10 crore) incurred under such lease have been expensed in the statement of profit and loss.

*- Figures being nullified on conversion of Rs, in crore

# During previous year professional fee of Rs, 0.37 crore paid for the services rendered in respect of the Bond issued by the Company has been accounted as transaction cost in accordance with Ind AS 109 for the year ended March 31, 2017

d) Details of Expenditure on Corporate Social Responsibilities

As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects.

A CSR committee has been formed by the company as per the Act. The funds were primarily allocated to a corpus and utilized throughout the year on these activities which are specified in Schedule VII of the Companies Act, 2013.

i) Gross amount required to spent during the year Rs, 57.13 crore (previous year Rs, 47.78 crore)

b) The company has a defined gratuity plan (funded) and is governed by the Payment of Gratuity Act, 1972. Under the Act, every employee who has completed at least five year of service is entitled to gratuity benefits on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with Life Insurance Corporation of India (LIC) in form of a qualifying insurance policy with effect from September 1, 2010 for future payment of gratuity to thenemployees.

Each year, the management reviews the level of funding in the gratuity fund. Such review includes the asset - liability matching strategy. The management decides its contribution based on the results of this review. The management aims to keep annual contributions relatively stable at a level such that no plan deficits (based on valuation performed) will arise.

The following tables summarise the component of the net benefits expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the respective plan.

The Company expect to contribute Rs, Nil to the gratuity fund in the financial year 2018-19 (previous year Rs, 2.40 crore).

(xi) Asset-Liability Matching Strategies

The Company has purchased insurance policy, which is basically a year-on-year cash accumulation plan in which the interest rate is declared on yearly basis and is guaranteed for a period of one year. The insurance company, as part of the policy rules, makes payment of all gratuity outgoes happening during the year (subject to sufficiency of funds under the

policy).The policy, thus, mitigates the liquidity risk.

However, being a cash accumulation plan, the duration of assets is shorter compared to the duration of liabilities. Thus, the Company is exposed to movement in interest rate (in particular, the significant fall in interest rates, which should result in a increase in liability without corresponding increase in the asset).

30 Segment Information

The Company is primarily engaged in one business segment, namely developing, operating and maintaining the Ports services, Ports related Infrastructure development activities and development of infrastructure at contiguous Special Economic Zone at Mundra, as determined by chief operational decision maker, in accordance with Ind-AS 108 "Operating

Segment”.

Considering the inter relationship of various activities of the business, the chief operational decision maker monitors the operating results of its business segment on overall basis. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss in the financial statements.

31 Related Party Disclosures

A. Related parties where control exists.

Wholly owned Subsidiary Companies Adani Ennore Container Terminal Private Limited

Adani Hazira Port Private Limited

Adani Hospitals Mundra Private Limited_

Adani Logistics Limited Adani Vizag Coal Terminal Private Limited Adani Warehousing Services Private Limited Karnavati Aviation Private Limited

MPSEZ Utilities Private Limited__

Mundra International Airport Private Limited_

The Dhamra Port Company Limited

Adani Vizhinjam Port Private Limited

Mundra International Gateway Terminal Private Limited

Mundra LPG Infrastructure Private Limited [w.e.f March 22, 2017] (formerly

known as Hazira Road Infrastructure Private Limited)

Adani Kattupalli Port Private Limited_

Adani International Terminals Pte Limited, Singapore

Adani Kandla Bulk Terminal Private Limited [w.e.f March 31, 2017]

Adani Murmugao Port Terminal Private Limited [w.e.f March 31, 2017]

Shanti Sagar International Dredging Private Limited (formerly known as Adani

Food and Agro Processing Park Private Limited)_

Abbot Point Operations Pty Limited_

The Adani Harbour Services Private Limited [acquired on December 07, 2016 (formerly known as TM Harbour Services Private Limited)

Adani Petroleum Terminal Private Limited [incorporated on April 26, 2016] Adinath Polyfills Private Limited Other Subsidiary Companies Dholera Infrastructure Private Limited (Controlling interest)

Adani Petronet (Dahej) Port Private Limited_

_Mundra SEZ Textile And Apparel Park Private Limited_

Step down Subsidiary Hazira Infrastructure Private Limited

Mundra LPG Terminal Private Limited [incorporated June 02, 2016] (formerly known as Adani LPG terminal Private Limited)

Adani Dhamra LPG Terminal Private Limited

Dholera Port and Special Economic Zone Limited (Controlling Interest)

Dhamra LNG Terminal Private Limited _Abott Point Bulk Coal Pty Limited [acquired on October 04, 2016]_

B. Other related parties with whom transactions have been taken place during the year.

Joint Venture Entities Adani CMA Mundra Terminal Private Limited__

Adani International Container Terminal Private Limited

Key Managerial Personnel and their relatives Mr. Gautam S. Adani - Chairman and Managing Director_

Mr. Rajesh S. Adani - Director and Brother of Mr Gautam S. Adani_

Dr. Malay Mahadevia - Wholetime Director_

Mr Karan G. Adani - Chief Executive Officer and son of Mr Gautam S. Adani

Mr. A.K. Rakesh, IAS - Non-Executive Director [upto September 07, 2016]_

Prof. G. Raghuram - Non-Executive Director_

Mr. Sanjay S. Lalbhai - Non-Executive Director_

Ms. Radhika Haribhakti - Non-Executive Director_

Mr. Gopal Krishna Pillai - Non-Executive Director_

Mr. B. Ravi - Chief Finance Officer ( till February 12, 2018)_

_Ms. Dipti Shah - Company Secretary_

Entities over which Key Management Personnel and Adani Foundation

their relatives having significant influence / major Adani Institute of Infrastructure Management shareholders of the Company are able to exercise Adani Properties Private Limited significant influence through voting powers. Delhi Golf Link Properties Private Limited

Adani Infrastructure and Developers Private Limited_

Adani Mundra SEZ Infrastructure Private Limited__

Adani Townships And Real Estate Company Private Limited

Abbot Point Port Holdings Pte Limited, Singapore_

Mundra Port Pty Limited, Australia_

Shanti Builders Adani Agri Fresh Limited

Adani Bunkering Private Limited_

Adani Enterprises Limited

Mundra Solar PV Limited

Adani Cementation Limited

Mundra Solar Technopark Private Limited

Adani Shipping Pte Limited

Adani Green Energy Limited

Adani Gas Limited

Adani Global F.Z.E.

Adani Infra (India) Limited_

Belvedere Golf and Country Club Private Limited_

Sunanda Agri Trade Private Limited_

Adani Skill Development Center_

Adani Power Dahej Limited

Adani Power (Mundra) Limited

Adani Power Maharashtra Limited

Adani Power Limited

Adani Power Rajasthan Limited

Adani Wilmar Limited

Kutch Power Generation Limited

Adani Institute for Education and Research__

_Gujarat Adani Institute Of Medical Sciences_

Terms and conditions of transactions with related parties

(i) Outstanding balances of related parties at the year end are unsecured and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. During the year, the Company has not recorded any impairment of receivables relating to amounts owed by related parties except provision has been made for loans given to a subsidiary of Rs, 196.10 crore (previous year Rs, 15.51 crore). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

(ii) All loans are given on interest bearing within the range of 6.25% p.a. to 11.50% p.a. except loan to Adani Logistics Limited, The Dhamra Port Company Limited (part of loan) , Dholera Infrastructure Private Limited, Dholera Port & Special Economic Zone Limited, Karnavati Aviation Private Limited, Adani Hospitals Mundra Private Limited, Mundra International Airport Private Limited, Abbot Point Operations Pty Limited, Adani International Terminals Pte Limited whereby loan transaction aggregating to Rs, 1,774.54 crore (previous year Rs, 1,519.58 crore) are interest free. During the previous year, the Company had relinquished its rights on payment of interest on loan amounting to Rs, 2,671.64 crore given to certain subsidiaries, in earlier period and outstanding as at April 1, 2016 i.e. Adani Ennore Container Terminal Private Limited; Adani Hazira Port Private Limited; Adani Kandla Bulk Terminal Private Limited; Adani Kattupalli Port Private Limited; Adani Murmugao Port Terminal Private Limited; Adani Vizag Coal Terminal Private Limited; Mundra SEZ Textile and Apparel Park Private Limited; Shanti Sagar International Dredging Private Limited and The Dhamra Port Company Limited to support the operation of these subsidiaries.

(i) The names of the related parties and nature of the relationships where control exists are disclosed irrespective of whether or not there have been transactions between the related parties. For others, the names and the nature of relationships is disclosed only when the transactions are entered into by the Company with the related parties during the existence of the related party relationship.

(ii) Aggregate of transactions for the year ended with these parties have been given below.

# Entities over which Key Managerial Personnel and their relatives having significant influence / major shareholders of the Company are able to exercise

significant influence through voting powers

Notes:

a) The Company has allowed to some of its subsidiaries, joint ventures and other group company to avail non fund based bank guarantee facilities out of its credit facilities. The aggregate of such transaction amounts to Rs, 1,778.45 crore (previous year Rs, 1,918.63 crore) is not disclosed in above schedule.

b) During the previous year, out of total advance of Rs, 302 crore given to Adani Enterprises Limited for acquisition of equity, the Company has adjusted Rs, 52 crore for the purpose of acquisition of Non-Controlling interest in two subsidiaries. (refer note 4 (d)) and balance amount is received back.

c) Pass through transactions/payable relating to railway freight, water front charges and other payable to third parties have not been considered for the purpose of related party disclosure.

c) Financial Instrument measured at Amortized Cost

The carrying amount of financial assets and financial liabilities measured at amortized cost in the financial statements are a reasonable approximation of their fair values since the Company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or settled.

33.3 Financial Risk objective and policies

The Company''s principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other payables, and financial guarantee contracts. The main purpose of these financial liabilities is to finance the Company''s operations/projects and to provide guarantees to support its operations and its subsidiaries and joint ventures. The Company’s principal financial assets include loans, investment including mutual funds, trade and other receivables, and cash and cash equivalents which is derived from its operations. The Company also holds FVTOCI investments and enters into derivative transactions.

In the ordinary course of business, the Company is mainly exposed to risks resulting from exchange rate fluctuation (currency risk), interest rate movements (interest rate risk) collectively referred as Market Risk, Credit Risk, Liquidity Risk and other price risks such as equity price risk. The Company’s senior management oversees the management of these risks. It manages its exposure to these risks through derivative financial instruments by hedging transactions. It uses derivative instruments such as Cross Currency Swaps, Full Currency swaps, Interest rate swaps, foreign currency future options and foreign currency forward contract to manage these risks. These derivative instruments reduce the impact of both favorable and unfavorable fluctuations.

The Company''s risk management activities are subject to the management, direction and control of Central Treasury Team of the Company under the framework of Risk Management Policy for Currency and Interest rate risk as approved by the Board of Directors of the Company. The Company''s central treasury team ensures appropriate financial risk governance framework for the

Company through appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives. It is the Company''s policy that no trading in derivatives for speculative purposes may be undertaken.

The decision of whether and when to execute derivative financial instruments along with its tenure can vary from period to period depending on market conditions and the relative costs of the instruments. The tenure is linked to the timing of the underlying exposure, with the connection between the two being regularly monitored. The Company is exposed to losses in the event of nonperformance by the counterparties to the derivative contracts. All derivative contracts are executed with counterparties that, in our judgment, are creditworthy. The outstanding derivatives are reviewed periodically to ensure that there is no inappropriate concentration of outstanding to any particular counterparty.

Further, all currency and interest risk as identified above is measured on a daily basis by monitoring the mark to market (MTM) of open and hedged position. The MTM is derived basis underlying market curves on closing basis of relevant instrument quoted on Bloomberg/Reuters.

For quarter ends, the MTM for each derivative instrument outstanding is obtained from respective banks. All gain / loss arising from MTM for open derivative contracts and gain / loss on settlement / cancellation / roll over of derivative contracts is recorded in the statement of profit and loss.

a) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk. Financial instruments affected by market risk include loans and borrowings, deposits, FVTOCI investments, short term Investments and derivative financial instruments.

The sensitivity analysis in the following sections relate to the position as at March 31, 2018 and March 31, 2017.

The sensitivity analysis have been prepared on the basis that the amount of net debt, the ratio of fixed to floating interest rates of the debt and derivatives and the proportion of financial instruments in foreign currencies are all constant as at March 31, 2018 and March 31, 2017. The analysis exclude the impact of movements in market variables on: the carrying values of gratuity and other post-retirement obligations; provisions.

The following assumptions have been made in calculating the sensitivity analysis:

-The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at March 31, 2018 and March 31, 2017

(i) Interest rate risk

The Company is exposed to changes in market interest rates due to financing, investing and cash management activities. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s long-term debt obligations with floating interest rates and period of borrowings. The Company manages its interest rate risk by having a balanced portfolio of fixed and variable rate loans and borrowings. The Company enters into interest rate swap contracts or interest rate future contracts to manage its exposure to changes in the underlying benchmark interest rates.

Interest rate sensitivity

The following paragraph demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected. With all other variables held constant, the Company''s profit before tax is affected through the impact on floating rate borrowings, as follows:

If interest rates had been 50 basis points higher / lower and all other variables were held constant, the Company''s profit for the year ended March 31, 2018 would decrease / increase by Rs, 9.33 crore (previous year Rs, 19.74 crore). This

is mainly attributable to interest rates on variable rate of long term borrowings.

(ii) Foreign currency risk

Exchange rate movements, particularly the United States Dollar (USD) and Euro (EUR) against Indian Rupee (INR), have an impact on the Company''s operating results. The Company manages its foreign currency risk by entering into currency swap for converting INR loan into other foreign currency for taking advantage of lower cost of borrowing in stable currency environment. The Company also enters into various foreign exchange contracts to mitigate the risk arising out of foreign exchange rate movement on foreign currency borrowings or trade payables. Further, to hedge foreign currency future transactions in respect of which firm commitment are made or which are highly probable forecast transactions (for instance, foreign exchange denominated income) the Company has entered into foreign currency forward contracts as per the policy of the Company.

The Company is mainly exposed to changes in USD, EURO, AUD, SGD and JPY. The below table demonstrates the sensitivity to a 1% increase or decrease in the respective foreign currency rates against INR, with all other variables held constant. The sensitivity analysis is prepared on the net unhedged exposure of the Company as at the reporting date. 1% represents management''s assessment of reasonably possible change in foreign exchange rate.

(III) Equity price risk

The Company''s non-listed equity securities are susceptible to market price risk arising from uncertainties about future values of the investment securities. The Company manages the equity price risk through diversification and by placing limits on individual and total equity instruments. Reports on the equity portfolio are submitted to the Company''s senior management on a regular basis. The Company’s Board of Directors reviews and approves all equity investment decisions.

The Company has given corporate guarantees and pledged part of its investment in equity in order to fulfill the collateral requirements of the subsidiaries and joint ventures companies. The counterparties have an obligation to return the guarantees/securities to the Company. There are no other significant terms and conditions associated with the use of collateral.

b) Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables and other financial assets) and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.

Customer credit risk is managed by the Company''s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on an extensive evaluation and individual credit limits are defined in accordance with this assessment.

An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The calculation is based on exchange losses historical data.

Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in accordance with the Company''s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the Company''s Board of Directors on an annual basis, and may be updated throughout the year subject to approval of the Company’s Finance Committee. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through counterparty’s potential failure to make payments.

Concentrations of Credit Risk form part of Credit Risk

Considering that the Company operates the port services and provide related infrastructure services, the Company is significantly dependent on such customers located at Mundra. Out of total income from port operations, the Company earns 28 % revenue (previous year 43%) from such customers, and with some of these customers, the Company has long term cargo contracts. As at March 31, 2018, receivables from such customer constitute 50% (previous year 66%) of total trade receivables. A loss of these customer could adversely affect the operating result or cash flow of the Company.

c) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in raising funds to meet commitments associated with financial instruments that are settled by delivering cash or another financial asset. Liquidity risk may result from an inability to sell a financial asset quickly at close to its fair value.

The Company has an established liquidity risk management framework for managing its short term, medium term and long term funding and liquidity management requirements. The Company’s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. The Company manages the liquidity risk by maintaining adequate funds in cash and cash equivalents. The Company also has adequate credit facilities agreed with banks to ensure that there is sufficient cash to meet all its normal operating commitments in a timely and cost-effective manner.

The table below analyses derivative and non-derivative financial liabilities of the Company into relevant maturity groupings based on the remaining period from the reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

Other Commitments

a) The port projects of subsidiary companies viz. Adani Petronet (Dahej) Port Private Limited, ("APDPPL") Adani Hazira Port Private Limited("AHPPL"), The Dhamra Port Company Limited ("DPCL") and joint venture Adani International Container

Terminal Private Limited (”AICTPL”) have been funded through various credit facility agreements with banks. Against the said facilities availed by the aforesaid entities from the banks, the Company has executed a Sponsor Undertaking and Pledge Agreements whereby 51% of the holding would be retained by the Company (In case of AICTPL jointly with the Joint Venture partner) at all points of time. Further, the Company is also required to pledge 30% (26% from the date of commencement of the operation) of its shareholding in the respective entities. (In case of AICTPL, jointly with Joint Venture partner of which 12.98% share held by Joint Venture partner are yet to be pledged with bank).

During the year, Adani Petronet (Dahej) Port Private Limited ("APDPPL") and Adani Hazira Port Private Limited ("AHPPL") has repaid loan to lenders and process for release of share pledge is in progress.

b) Contract/ Commitment for purchase of certain supplies. Advance given Rs, 231.19 crore (previous year Rs, 251.81 crore)

c) The Company has, through its subsidiary Adani Kattupalli Port Private Limited ("AKPPL"), entered into an in principle agreement on November 1, 2015 for strategic acquisition of the Kattupalli Port in Tamil Nadu from L&T Shipbuilding Limited ("LTSB") a subsidiary of Larsen & Toubro Limited. The transaction is subject to receiving the necessary government and regulatory approvals and the port business being demerged from LTSB. While awaiting all the necessary approvals, APSEZL

through its subsidiary AKPPL has an arrangement to operate the Port w.e.f November 1, 2015 through AKPPL.

37 Assets Held for sale

During the previous year, the Board of Directors of the Company in their meeting held on February 14, 2017 has approved to transfer Maintenance Dredging Operations of the Company consisting of fleet of dredgers and relevant support facilities to Shanti Sagar International Dredging Private Limited, a wholly owned subsidiary. The Business Transfer Agreement has been entered between the parties on April 1, 2017 to transfer the following assets and liabilities of the Maintenance Dredging Operations to the subsidiary at a consideration of Rs, 96.00 crore:

k) The Company''s tax assessments is completed till assessment year 2014-15, pending appeals with Appellate Tribunal for Assessment Year 2009-10 to 2011-12 and CIT (Appeals) for Assessment Year 2012-13 to 2014-15. During the year, the Company has received a favourable order from Appellate Tribunal for assessment year 2008-09. Further, Hon''ble HC has approved the order of Tribunal for allowability of net interest income/expense under section 80-IAB. The management is reasonably confident that no liability will devolve on the Company. l) The Company had initiated and recorded the divestment of its entire equity holding in Adani Abbot Point Terminal Holdings Pty Limited ("AAPTHPL'') and entire Redeemable Preference Shares holding in Mundra Port Pty Limited ("MPPL'') representing Australia Abbot Point Port operations to Abbot Point Port Holdings Pte Limited, Singapore during the year ended March 31, 2013. The sale of securities transaction was recorded as per Share Purchase Agreement (''SPA'') entered on March 30, 2013 including subsequent amendments thereto, with a condition to have regulatory and lenders approvals. The Company has all the approvals except in respect of approval from one of the lenders who has given specific line of credit to MPPL. The Company received entire sale consideration except AUD 17.17 Million as on reporting date. The Company expect to receive the said amount in next year. The Company also has outstanding corporate guarantee to a lender of USD 800 million against line of credit to MPPL, which is still outstanding and has also pledged its entire equity holding of 1,000 equity shares of AUD 1 each in MPPL at the reporting date in favour of lender. Outstanding loan against said corporate guarantee as on March 31, 2018 is USD 288.00 million (previous year USD 453.00 million). Since financial year 2013-14, the Company has received corporate guarantee (’Deed of Indemnity’) against above outstanding corporate guarantee from Abbot Point Port Holding Pte Limited, Singapore which is effective till discharge of underlying liability.

41 The Company has entered into preliminary agreement with a party for development and maintenance of Liquefied Natural Gas ("LNG") terminal infrastructure facilities at Mundra ("the LNG Project") vide an agreement dated September 30, 2014. Pursuant to the said agreement, the Company had received mobilization advance amounting to '' 50 crore. Construction activities by the Company and other party are currently in progress. The Company had, during the quarter ended September 30, 2014, recognized project service revenue of Rs, 200 crore towards land reclamation pending conclusion of a definitive agreement based on the activities completed. The implementation of the LNG Project is progressing as per the Company''s expectations and the Company and the other party have spent substantial amounts on their respective areas as per the agreement on the LNG Project which are within their scope. The Management based on its assessment of ongoing activities, is of the view that a definitive agreement would be concluded shortly and the Company expects to sell / lease the LNG Project facilities once the definitive agreement is concluded. Accordingly, accrued revenue and the value of assets being constructed by the Company with respect of the LNG Project are considered fully recoverable.

42 During the year, the Company transferred Container Terminal Infrastructure Assets to Adani CMA Mundra Terminal Private Limited and Adani International Container Terminal Private Limited (AICTPL), a (50:50) joint venture entities, w.e.f. May 15, 2017 and November 1, 2017 respectively. The income from sale /sub-lease of core port assets aggregating to '' 2,258.85 crore are included in revenue from operations and corresponding related costs are shown under head "Operating Expenses".

43 During the year ended March 31, 2017, the Board of Directors of APSEZL (hereinafter referred as "the Transferor Company") and The Adani Harbour Service Private Limited (Formerly known as "TM Harbour Services

Private Limited") (hereinafter referred as "the Transferee company" or AHSPL''), a wholly owned subsidiary of the Company had approved a Scheme of Arrangement ("the Scheme") between the Transferor Company and the Transferee Company. Pursuant to the Scheme, the Marine Business Undertaking ("Demerged Business") of the Transferor Company was transferred on slump sale basis to the Transferee Company with appointed date of April 1, 2016. After necessary approvals from the relevant stakeholders of both the companies, the Scheme was sanctioned by National Company Law Tribunal ("NCLT") at Ahmedabad vide its order dated August 18, 2017. The Scheme became operative from August 23, 2017 upon filing of certified copy of the order of the NCLT, Ahmadabad with the Registrar of Companies.

The Company has accounted for the transaction in accordance with the accounting treatment prescribed in the Scheme as approved by the NCLT, Ahmedabad whereby the net assets of the Marine Business Undertaking amounting to Rs, 397.18 crore of the Transferor Company as at April 1, 2016, being the appointed date, have been transferred to the transferee company for a consideration of Rs, 200 crore. The shortage of the amount received as consideration and the net assets i.e. Rs, 197.18 crore, as at the appointed date is adjusted to the balance of retained earnings.

Furthermore, pursuant to the demerger, the financial results of the Marine business undertaking w.e.f the appointed date till March 31, 2017 also stands transferred to the transferee company and is presented as an adjustment to the retained earnings.

APSEZL has not given effect in the comparative numbers for the period ended March 31, 2017, hence the figures for the current year are not comparable with the previous year. However, Statement of Profit and Loss and

Statement of Cash flows of Marine Business Undertaking for the year ended March 31, 2017 would be as below:

44 Exposure Drafts and Accounting Standards not yet notified

On March 28, 2018, the Ministry of Corporate Affairs notified the Companies (Indian Accounting Standards) Amendment Rules, 2018, notifying amendments to the following Ind AS''s. These amendments are applicable from April 1, 2018.

Appendix B to Ind AS 21, foreign currency transactions and advance consideration

The Appendix B to Ind AS 21 clarifies the date of the transaction for the purpose of determining the exchange rate to use on initial recog


Mar 31, 2017

1 CORPORATE INFORMATION

The financial statements comprise financial statements of Adani Ports and Special Economic Zone Limited (the “Company, APSEZL”) for the year ended March 31, 2017. The Company is a public company domiciled in India and is incorporated under the provisions of the Companies Act applicable in India. Its shares are listed on two recognized stock exchanges in India. The registered office of the Company is located at “Adani House”, Mithakhali Six Roads, Navrangpura, Ahmedabad-380009 The Company is in the business of development, operations and maintenance of port infrastructure (port services and related infrastructure development) and has linked multi product Special Economic Zone (SEZ) and related infrastructure contiguous to Port at Mundra. The initial port infrastructure facilities at Mundra including expansion thereof through development of additional port terminals and south port terminal infrastructure facilities are developed pursuant to the concession agreement with Government of Gujarat (GoG) and Gujarat Maritime Board (GMB) for 30 years period effective from February 17, 2001. At Mundra, the Company has expanded port infrastructure facilities through approved supplementary concession agreement (pending to be concluded) which will be effective till the year 2040, whereby port infrastructure has been developed at Wandh at Mundra to handle coal cargo. The said agreement is in the process of getting signed with GoG and GMB although Coal terminal at Wandh is recognized as commercially operational w.e.f, February 01, 2011.

The first Container terminal facilities (CT-1) developed at Mundra, was transferred under sub-concession agreement entered into on January 7, 2003 between Mundra International Container Terminal Limited (MICTL) (erstwhile Adani Container (Mundra) Terminals Limited) and the Company wherein the Company has given rights to MICTL to handle the container cargo for a period of 28 years i.e. up to February 17, 2031. The container terminal facilities developed at South Port location (CT-3) has been leased under approved sub concession agreement dated October 17, 2011 to (50:50) joint venture company, Adani International Container Terminal Private Limited (AICTPL), co-terminate with main concession agreement with GMB. The said sub-concession agreement is pending to be concluded with GOG and GMB. Another Container Terminal developed at south port location i.e. CT-4 has been developed in terms of (50:50) joint venture arrangement with CMA Terminals, France since July 30, 2014. The said container terminal is currently temporary operated, pending approval of sub concession agreement by the GMB.

The Multi Product Special Economic Zone developed at Mundra by the Company along with port infrastructure facilities is approved by the Government of India vide their letter no. F-2/11/2003/EPZ dated April 12, 2006 and subsequently amended from time to time till date. The Company has also set up Free Trade and Warehousing Zone at Mundra based on approval of Ministry of Commerce and Industry vide letter no.F.1/16/2011-SEZ dated January 04, 2012. The Company has also set up additional Multi Product Special Economic Zone at Mundra Taluka over an area of 1,856 hectares as per approval from Ministry of Commerce and Industry vide approval letter dated April 24, 2015. The Company has received single notification consolidating three notified SEZ in Mundra vide letter dated March 15, 2016 of Ministry of Commerce and Industry, Department of Commerce (SEZ Section).

The financial statements were authorised for issue in accordance with a resolution of the directors on May 24, 2017.

2 BASIS OF PREPARATION

2.1 The financial statements of the Company has been prepared in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 (as amended).

For all periods up to and including the year ended March 31, 2016, the Company prepared its financial statements in accordance accounting standards notified under the section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP). These financial statements for the year ended March 31, 2017

are the first the Company has prepared in accordance with Ind AS. Refer note 44 for information on how the Company adopted Ind AS.

The financial statements have been prepared on a historical cost basis, except for the following assets and liabilities which have been measured at fair value or revalued amount:

- Derivative financial instruments,

- Defined Benefit Plans - Plan Assets measured at fair value; and

- Certain financial assets and liabilities measured at fair value (refer accounting policy regarding financial instruments).

In addition, the financial statements are presented in INR and all values are rounded to the nearest Crore (INR 00,00,000), except when otherwise indicated.

2.2 Significant accounting judgments, estimates and assumptions

The preparation of the Company’s Ind AS Financial Statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Judgements

In the process of applying the Company’s accounting policies, Management has made the following judgement, which has the most significant effect on the financial statements.

Proposed sale of Marine Business Undertaking under the Scheme of Arrangement:

On February 14, 2017, the Board of Directors announced its decision to demerge Marine Business Operations of piloting and movement of vessels using tugs, berthing and de-berthing of vessels using tugs, marine logistic support services, towage and transshipment within in-land waterways, in coastal waters and sea, through the proposed Scheme of Arrangement to a wholly owned subsidiary. The demerger transaction under the scheme is subject to the approval of creditors, shareholders and National Company Law Tribunal (“NCLT”) and said approval are pending at year end. Considering the above approvals to be substantive requirements, no adjustment has been made for the accounting treatment proposed in the aforesaid scheme, in the financial statements.

Carrying value of net assets of the Marine Business Operations as at March 31, 2017 is RS.397.16 crores (excluding borrowings of RS.111.21 crores). Also refer note 42(a).

Entity in which the Company holds less than a majority of voting rights (de facto control:)

The Company considers that it controls Dholera Infrastructure Private Limited (DIPL) even though it owns less than 50% of the voting rights. The Company is holding 49% equity interest in DIPL with the remaining 51% being held by another shareholder. Based on evaluation of terms and conditions of share purchase agreement, the Company is exposed and has rights to variable returns of DIPL and has ability to affect those returns through its power given under share purchase agreements.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

Impairment of non-financial assets

Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount, which is the higher of its fair value less costs of disposal and its value in use. The fair value less costs of disposal calculation is based on available data for similar assets or observable market prices less incremental costs for disposing of the asset. The value in use calculation is based on a DCF model. The cash flows are derived from the budget for the next five years and do not include restructuring activities that the Company is not yet committed to or significant future investments that will enhance the asset’s performance being tested. The recoverable amount is sensitive to the discount rate used for the DCF model as well as the expected future cash-inflows and the growth rate used for extrapolation purposes. These estimates are most relevant to goodwill with indefinite useful lives recognised by the Company. The key assumptions used to determine the recoverable amount for the CGU, are disclosed and further explained in note 3(b).

Taxes

Deferred tax assets are recognised for unused tax credits to the extent that it is probable that taxable profit will be available against which the credits can be utilised. Significant management judgment is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits together with future tax planning strategies. Further details on taxes are disclosed in note 26.

Defined benefit plans (gratuity benefits)

The cost of the defined benefit gratuity plan and the present value of the gratuity obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.

The parameter most subject to change is the discount rate. In determining the appropriate discount rate for plans operated in India, the management considers the interest rates of government bonds in currencies consistent with the currencies of the post-employment benefit obligation. The underlying bonds are further reviewed for quality. Those having excessive credit spreads are excluded from the analysis of bonds on which the discount rate is based, on the basis that they do not represent high quality corporate bonds.

The mortality rate is based on publicly available mortality tables for the specific countries. Those mortality tables tend to change only at interval in response to demographic changes. Future salary increases and gratuity increases are based on expected future inflation rates for the respective countries.

Further details about gratuity obligations are given in note 29.

Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the DCF model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgment is required in establishing fair values. Judgments include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments. refer note 33 for further disclosures.

Provision for Decommissioning Liabilities

The management of the Company has estimated that there is no probable decommissioning liability under the condition/ terms of the concession agreement with the GMB.

Note 3(a) Property Plant and Equipment (contd.)

i) Depreciation of RS.71.11 crore (previous year RS.61.52 crore) relating to the project assets has been allocated to Capitalisation / Capital Work in progress.

ii) Freehold Land includes land development cost of RS.12.56 crore (previous year RS.12.56 crore).

iii) Plant and Equipment includes cost of Water Pipeline amounting to RS.6.65 crore (Gross) (previous year RS.6.65 crore), accumulated depreciation RS.4.07 crore (previous year RS.3.67 crore) which is constructed on land not owned by the Company.

iv) Buildings includes 612 residential flats (previous year 588 flats) and a hostel building valuing RS.139.94 crore (previous year RS.131.04 crore) at Samudra Township, Mundra, which are pending to be registered in Company’s name. Further an advance of RS.8.19 crores (previous year RS.22 crore) is also paid to purchase additional flats / hostel building.

v) As a part of concession agreement for development of port and related infrastructure at Mundra the Company has been allotted land on lease basis by Gujarat Maritime Board (GMB). The Company has recorded rights in the GMB Land at present value of future annual lease payments in the books and classified the same as lease hold land.

vi) Land development cost on leasehold land includes costs incurred towards reclaimed land of RS.202.21 crore (previous year RS.202.21 crore). The cost has been estimated by the management, being cost allocated out of the dredging activities approximate the actual cost.

vii) Reclaimed land measuring 1,271.58 hectare are pending to be registered in the name of the Company.

viii) Project Assets include dredgers and earth moving equipments.

ix) Land Development cost and Right to use on Leasehold Land includes Land taken on Finance Lease Basis:

Gross Block as at March 31, 2017 - RS.4.11 crore (previous year - RS.4.11 crore and April 01, 2015 - RS.4.11 crores)

Depreciation for the year: RS.0.26 crore (previous year - RS.0.27 crore)

Accumulated Deprecation as at March 31, 2017 - RS.0.53 crore (previous year - RS.0.27 crores and April 01, 2015 - NIL)

Net Block as at March 31, 2017 - RS.3.58 crores (previous year - RS.3.85 crores and April 01, 2015 - RS.4.11 crores)

x) Free hold Land includes Land given on Operating Lease Basis:

Gross Block as at March 31, 2017 - RS.7.02 crore (previous year - RS.6.68 crore and April 01, 2015 - RS.6.68 crores)

Accumulated Depreciation for the year: RS.0.43 crore (previous year - RS.0.37 crore and April 01, 2015 RS.0.31 crore)

Net Block as at March 31, 2017 - H 6.59 crores (previous year - RS.6.31 crores and April 01, 2015 - RS.6.37 crores)

Note 3(a) Intangible Assets

Goodwill acquired through business combination pertains to cash generating units (CGUs) which are part of ‘Port and SEZ activities segment. The goodwill is tested for impairment annually. As at March 31, 2017, March 31, 2016 and April 01, 2015, the goodwill is not impaired.

The recoverable amount of the CGUs are determined from value -in-use calculation. The key assumptions for the value-in-use calculations are those regarding the discount rate, growth rates and expected changes to direct costs during the year. Management estimates discount rate using pre-tax rates that reflect current market assessments of the time value of money.

The growth rate are based management’s forecasts . Changes in selling prices and direct costs are based on past practices and expectations of future changes in the market.

The Company prepares its forecasts based on the most recent financial budget approved by management with projected revenue growth rates raging from 6% to 20 % the rate used to discount the forecast is 8.5% p.a.

The management believe that any reasonable possible change in any these assumptions would not cause the carrying amount to exceed its recoverable amount.

Notes:

a) Aggregate cost of unquoted investments as at March 31, 2017 RS.9,515.65 crore (previous year RS.5,184.77 crore and April 01, 2015 RS.4,889.33 crore).

b) Number of Share pledged with banks against borrowings by the respective companies as per below.

c) (i) The Company is carrying equity investment of RS.101.28 crore and has outstanding net term loan of RS.290.09 crore in a subsidiary, engaged in Port services under concession from one of the port trust authorities of the Government of India. This subsidiary company is temporarily not operating the port operations since January 2016 due to various operational bottlenecks, unviability of operating the port terminal, pending resolution to management’s representation to port regulatory authorities and Ministry of Shipping in the matter. The management of the subsidiary company expects to have early resolution to operational issues at Port terminal whereby long term sustainability of the operations is achievable with adequate cash flows. The subsidiary had incurred net cash loss in current year as well as previous year and has accumulated losses of RS.137.99 crores as at March 31, 2017, whereby subsidiary company’s net worth has become negative. The Company has undertaken to provide such financial support, as necessary, to enable the subsidiary company to meet the operational requirements as they arise and to meet its liabilities as and when they fall due and does not expect any impairment provision against its exposure. Accordingly, financial statements of the subsidiary company have been prepared on a ‘going concern’ basis, no provision/adjustments to the carrying value of the said investments/loans is considered necessary by the management as at March 31, 2017.

(ii) The Company is carrying equity investments of RS.122.50 crore and has outstanding net term loans and advances of RS.1,170.51 crore, in subsidiary companies engaged in Port services under concession agreement with the port trust authorities of Government of India and in business of development of integrated textile park at Mundra SEZ. The net worth of these Companies have been eroded based on the latest financial Statements.

As per the management, considering the gestation period required for break even for such infrastructure investment projects, expected higher cash flows based on future business projections prepared by the management and the strategic nature of these investments, no provision/adjustment to the carrying value of such investment project / loans is considered necessary by the management as at March 31, 2017.

d) During the year ended March 31, 2017, the Company has accounted for purchase of 31,213,000 and 30,131,014 numbers of equity shares in two subsidiaries, Adani Kandla Bulk Terminal Private Limited and Adani Murmugao Port Terminal Private Limited, respectively at total consideration of RS.61.34 crores. The equity shares has been purchased from the Adani Enterprises Limited, a group company whereby these entities have become wholly owned subsidiaries. As per the management, the transfer has been recorded based on Irrevocable Letter of Affirmation dated March 31, 2017 from the seller and acceptance by the Company although legal transfer of such equity share is still in process at year end.(Also refer note 31).

e) Reconciliation of Fair value measurement of the investment in unquoted equity shares

f) Value of Deemed Investment accounted in subsidiaries and jointly controlled entities in terms of fair valuation under Ind AS 109

g) Investment in Perpetual Non-convertible Debenture is redeemable at issuer’s option and redemption can be deferred indefinitely.

Notes:

a) No trade or other receivable are due from directors or other officers of the Company either severally or jointly with any other person; nor any trade or other receivable are due from firms or private companies in which any director is a partner, a director or a member.

b) Generally, as per credit terms trade receivable are collectable within 30-180 days although the Company provide extended credit period with interest between 8% to 10% considering business and commercial arrangements with the customers including with the related parties. Receivable of RS.7.91 crore (previous year RS.16.09 crore and April 01, 2015 RS.35.52 crore) are contractually collectable on deferred basis.

c) The Carrying amounts of the trade receivables include receivables which are subject to a bills discounting arrangement. Under this arrangement, the Company has transferred the relevant receivables to the bank / financial institution in exchange of cash and is prevented from selling or pledging the receivables. The Cost of bill discounting has been to the customer’s account as per the arrangement. However, the Company has retained late payment and credit risk. The Company therefore continues to recognise the transferred assets in their entirety in its balance sheet. The amount repayable under the bills discounting arrangement is presented as unsecured borrowing.

Notes:

a) The Company has granted interest bearing loans in the nature of inter-corporate loans and deposits aggregating NIL (previous year RS.2,325.84 crore and April 01, 2015 RS.2,137.87 crore)(including renewals on due dates) as at March 31, 2017 to its subsidiaries and other related parties, excluding loans / deposits granted to subsidiaries towards funding of development of specific ports and related infrastructure. The funds are advanced based on the business needs and exigencies and other cases to invest surplus fund or gave loans / deposits to avail future commercial benefits with an option to purchase underlying assets.

b) Further, the Company has also extended inter-corporate deposits aggregating RS.1,345.14 crore (previous year RS.1,217.37 and April 01, 2015 RS.1,261.35 crore) (Including renewals on due dates) to third parties. The deposits are given at prevailing market interest rates. The inter-corporate deposits have been approved by the Finance committee of the Board of Directors .

The Company has received adequate undertaking on record by its promotors’ company to safeguard the full recovery of this amount together with the interest. In the opinion of the Company, all these loans /deposits are considered good and realisable as at the year end.

Notes:

a) Capital advance includes RS.79.10 crore (previous year RS.72.85 and April 01,2015 RS.64.87 crore) paid to various private parties and government authorities towards purchase of land.

b) The Company has received bank guarantees of RS.1.66 crore (previous year RS.119.86 crore and April 01,2015 RS.42.64 crore) against capital advances.

4 EQUITY

a) Reconciliation of the shares outstanding at the beginning and at the end of the reporting year

Terms/rights attached to equity shares

(i) The Company has only one class of equity share having par value of RS.2 per share. Each holder of equity share is entitled to one vote per share. The Company declares and pays dividends in Indian Rupees.

(ii) For the current financial year 2016-17, the Company has proposed dividend per share to equity shareholder of RS.1.30 (declared for the previous financial year interim dividend per share RS.1.10)

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

b) During the year ended March 31, 2016, the Company had given effect of composite scheme of arrangement w.e.f. April 01, 2015 as per sanction of Honorable High Court of Gujarat and filing of scheme with Registrar of Companies. In accordance with the terms of the scheme of arrangement, the Company has issued new equity shares to the equity shareholders of Adani Enterprises Limited (“AEL”) in the ratio of 14,123 equity shares having face value of RS.2 each for every 10,000 equity shares with a face value of RS.1 held by each of the equity shareholders of AEL on June 08, 2015 without payment being received in cash (refer note 42(b)).

c) Equity Component of convertible preference share

Terms of Non-cumulative redeemable preference shares

(i) The Company has outstanding 28,11,037 0.01 % Non-Cumulative Redeemable Preference Shares (‘NCRPS’) of RS.10 each issued at a premium of RS.990 per share. Each holder of preference shares has a right to vote only on resolutions placed before the company which directly affects the right attached to preference share holders. These shares are redeemable on March 28, 2024 at an aggregate premium of RS.278.29 crore (equivalent to RS.990.00 per share). In the event of liquidation of the Company, before redemption the holder of NCRPS will have priority over equity shares in the payment of dividend and repayment of capital. The preference shares carry fixed dividend which is non-discretionary.

(ii) Under Indian GAAP, the preference shares were classified as equity and dividend payable thereon was treated as distribution of profit. Under Ind AS, the Preference Shares issued by the company classifies as Compound Financial Instrument. These non-convertible preference shares are separated into liability and equity components based on the terms of the contract. Interest on liability component is recognised as interest expense using the effective interest method.

(iii) The equity component of convertible preference shares includes the securities premium amount received on issue of preference shares and the preference share capital, redemption premium reserve being created in compliance of the Companies Act, 2013.

d) Details of shareholders holding more than 5% shares in the company

5 LONG TERM BORROWINGS

a) Debentures include Secured Non-Convertible Redeemable Debentures amounting to RS.2,410.15 crore (previous year RS.2,583.49 crore and April 01, 2015 RS.1989.10 crore) are secured by first Pari-passu charge on all the immovable and movable assets of Multi-purpose Terminal, Terminal-II and Container Terminal -II project assets and specific charge over land (valued at market value)

b) Debentures include Secured Non-Convertible Redeemable Debentures aggregating to RS.93.68 crore (previous year RS.148.64 crore and April 01, 2015 RS.634.13 crore) are secured by exclusive mortgage and charge on entire Single Point Mooring (SPM) facilities serving Indian Oil Corporation Limited - Mundra and the first charge over receivables from Indian Oil Corporation Limited.

c) (i) Debentures include Secured Non-Convertible Redeemable Debentures aggregating to NIL (previous year RS.400.00 crore and April 01, 2015 RS.1,000.00) are secured by first specific charge over 138 hectares land situated at Navinal Island, Mundra Taluka Kutch District, Gujarat (valued at market value).

(ii) Debentures include Secured Non-Convertible Redeemable Debentures aggregating to NIL (previous year RS.500.00 crore and April 01, 2015 RS.500.00) are secured by first specific charge over 79 hectares land situated at Mundra Taluka, Kutch District, Gujarat (valued at market value).

d) Debentures include Secured Non-Convertible Redeemable Debentures aggregating to RS.1,750.06 crore (previous year NIL and April 01, 2015 NIL) are secured by first pari-passu charge on all the movable and immovable assets pertaining to coal terminal project assets at Wandh.

e) Debentures include Secured Non-Convertible Redeemable Debentures aggregating to RS.1,300 crore (previous year NIL and April 01, 2015 NIL) are secured by first pari-passu charge on specified assets of certain subsidiary companies arrangements as per Debenture Trust Deed.

f) Foreign currency loan aggregating to RS.168.38 crore (previous year RS.233.37 crore and April 01, 2015 RS.255.84 crore) carries interest @ 6 months Euribor plus basis point in the range of 95 to 140. Further, out of the above loan is repayable in 11 Semi-annual instalment of RS.15.31 crore from the balance sheet date. The loan is secured by exclusive charge on the Dredgers procured under the facility.

g) Foreign Currency loan aggregating to NIL crore (previous year RS.16.40 crore and April 01, 2015 RS.30.45 crore) carries interest @ 6 months libor plus 225 basis point. The loan is repaid during the year. The loan was secured by exclusive charge on the dredgers and is further secured by way of second pari passu charge on the entire movable and immovable assets pertaining to Multi purpose Terminal, Terminal-II and Container Terminal -II project assets and Single Point Mooring.

h) Foreign currency loans aggregating to RS.75.13 crore (previous year RS.98.14 crore and April 01, 2015 RS.102.07 crore) carries interest @ 6 months Euribor plus 75 basis point. The loan is repayable in 10 semi annually equal instalments of approx. RS.7.51 crore from the balance sheet date. The loan is secured by exclusive charge on the Cranes purchased under the facility

i) Foreign Currency Loans from Banks aggregating to NIL (previous year NIL and April 01, 2015 RS.1,873.86 crore) was secured by the first pari passu charge on all the immovable and movable assets pertaining to Multi purpose terminal, Terminal II, Container Terminal II, project assets of the company and carry interest @ 3 to 6 Months libor plus basis point in range of 260 to 380. The Loan is repaid during the year 2015-16.

j) Foreign currency Loans from bank aggregating to NIL (previous year NIL and April 01, 2015 RS.274.95 crore) was secured by first pari passu charge on all the movable and immovable assets pertaining to Coal terminal project assets at Wandh and carries interest @ 3 Months libor plus 330 basis point. The Loan is repaid during the year 2015-16.

k) Foreign currency Loans from bank aggregating to NIL (previous year NIL and April 01, 2015 RS.1,850.42 crore) carries interest @ 3 months libor plus basis point in range of 310 to 370, These loans were secured by first pari passu charge on all the movable and immovable assets pertaining to Coal Terminal project assets at Wandh and specific charge over land admeasuring to 175 hectares situated at Mundra Taluka, Kutch district, Gujarat. The Loan is repaid during the year 2015-16.

l) Foreign Currency Loans from banks aggregating to NIL (previous year RS.93.25 crore and April 01, 2015 RS.94.49 crore) carries interest @ 4.6% p.a. The Loan is repaid during the year. These loans were secured by exclusive charge on the Tug assets.

m) Foreign currency loan aggregating to NIL (previous year RS.130.62 crore and April 01, 2015 RS.344.00 crore) carries interest @ 3 to 6 months Libor plus 310 basis point and 6 months Euribor plus a margin of 290 basis point. The loans were secured by first Pari-passu charge on all the immovable and movable assets of Multi purpose terminal, Terminal-II and Container Terminal -II project assets. The Loan is repaid during the year 2015-16 and 2016-17.

n) Foreign currency Loans from bank aggregating to NIL (previous year RS.388.64 crore and April 01, 2015 RS.554.46 crore) is secured by first pari passu charge on all the movable and immovable assets pertaining to Coal terminal project assets at Wandh and carries interest @ 3 months Libor plus basis point in the range of 225 to 305. The Loan is repaid during the year 2015-16 and 2016-17.

o) Foreign Currency Loan aggregating to RS.878.22 crore (previous year RS.1,001.17 crore and April 01, 2015 NIL) carries interest at 6 month libor plus 180 basis point. The Loan is repayable in 3 annual instalment of RS.206.64 crore and an instalment of RS.258.29 crore at balance sheet date. This loan is secured by first pari-passu charge on all the immovable and movable assets of Multi-purpose Terminal, Terminal-II and Container Terminal-II project assets.

p) Rupee Term Loan from bank aggregating to NIL (previous year NIL and April 01, 2015 RS.102.00 crore) was secured by first pari passu charge on all the movable and immovable assets pertaining to Agripark project assets and carries interest @ 10.50% p.a. The loan was repaid during the year 2015-16.

q) Rupee term loan amounting to NIL (previous year NIL and April 01, 2015 RS.448.93 crore) carrying interest rate at 11.45% p.a were secured by exclusive charge on land parcel of 90 hectares situated at Mundra Taluka Kutch District, Gujarat. The loan is repaid during the year 2015-16.

r) Rupee term loan amounting to NIL (previous year NIL and April 01, 2015 RS.200.00 crore) carrying interest rate at 9.70% p.a was secured by first pari passu charge on Multi purpose Terminal, Terminal II and Container Terminal II .The Loan is repaid during the year 2015-16.

s) Suppliers bills accepted under foreign currency letters of credit aggregating to RS.555.11 (previous year RS.82.65 and April 01, 2015 RS.121.59 crore) carries interest @ 3 to 12 months libor plus basis point in range of 16 to 215 and 6 to 12 months Euribor plus basis point in the rage of 30 to 35. Loan of RS.121.59 crore and RS.82.65 crore repaid on maturity the year 2015-16 and 2016-17 respectively and RS.555.11 payable on maturity from 2017-18 to 2019-20. The loan was secured against exclusive charge on assets purchased under the facility,

t) Unsecured Loan

(i) 5 years Foreign Currency Bond of USD 650 million equivalent to RS.4,215.25 crore (previous year RS.4,306.58 crore and April 01, 2015 NIL) carries interest @ 3.50 % p.a. with bullet repayment in the year 2020.

(ii) 5 years Foreign Currency Bond of USD 500 million equivalent to RS.3,207.56 crore (previous year NIL and April 01, 2015 NIL) carries interest rate at 3.95% p.a. with bullet repayment in the year 2022.

(iii) Foreign Currency loan NIL (previous year RS.993.83.crore and April 01, 2015 NIL) carries interest rate at 1.95% p.a. to 2.30 % for six months is paid during the year 2016-17.

(iv) Foreign Currency loan of RS.226.98 crores (previous year RS.231.89 crore and April 01, 2015 NIL) carries basis overnight libor plus 120 basis point repayable at maturity during the year 2017-18.

(v) Foreign Currency Loan aggregating to RS.1034.68 crore (previous year RS.1,057.10 crore and April 01, 2015 NIL) carries interest at 2.85% fixed for 18 months and than after 6 months Libor plus 2.2%. is repayment in the year 2021.

(vi) Foreign Currency Loan aggregating of RS.12.31 crore (previous year RS.16.69 crore and April 01, 2015 RS.18.44 crore) carry interest at 2.12 % p.a. The outstanding loan amount is repayable in 6 semi- annual equal instalment of RS.2.05 crore from the balance sheet date.

(vii) Suppliers bills accepted under foreign currency letters of credit aggregating to RS.31.47 crore (previous year RS.14.55 crore and April 01, 2015 NIL) carries interest at 6 months Libor plus basis point in range of 10 to 51 and 12 months Euribor plus basis point in the range of 35 to 75 basis points. Loan of RS.14.55 crore repaid on maturity in the year 2016-17 and RS.31.47 payable on maturity from 2017-18 to 2019-20.

(viii) Foreign currency loan aggregating to RS.483.45 crore (previous year NIL and April 01, 2015 NIL) carried interest 6 months Libor plus 204 basis point .The loan is repayable in 3 annual instalments of RS.128.92 crore, RS.161.15 crore and Rs. 193.38 crore from the balance sheet date.

(ix) Foreign currency loan aggregating to RS.483.23 crore (previous year NIL and April 01, 2015 NIL) carried interest 3 months Libor plus 200 basis point .The loan has bullet repayment in the year 2021.

a) Suppliers bills accepted under foreign currency letters of credit aggregating to NIL (previous year NIL and April 01, 2015 RS.119.85 crore) carries interest @ 6 months Libor plus basis point in range of 35 to 40 which was paid on maturity in year 2015-16. The loan was secured against exclusive charge on assets and materials purchased under the facility.

b) Supplier Bills aggregating to NIL (previous year NIL and April 01, 2015 RS.35.03 crore) carries interest @ 6 Months Libor plus basis point in range of 35 to 65 which was paid on maturity in 2015-16 The loan was secured against subservient charge on movable assets and current assets except those secured by exclusive charge in favour of other lenders .

c) Suppliers bills accepted under foreign currency letters of credit aggregating to RS.2.47 crore (previous year RS.15.91 crore and April 01, 2015 NIL) carries interest at 1 -12 months Libor plus basis point in the range of 15 to 75 and 6 to 12 Months Euribor plus basis point in range of 38 to 40. The loan is repaid on maturity in the year 2016-17. The loan was secured against material purchased under the facilities.

d) Suppliers bills accepted under foreign currency letters of credit aggregating to NIL (previous year RS.2.25 crore and April 01, 2015 NIL) carries interest at 6 months Libor plus 45 basis point and 12 month Euribor plus 38 basis point. The loan is unsecured and paid during the year.

e) Commercial Paper (CP) aggregating RS.2,531. 42 crore (previous year RS.3,115.65 crore and April 01, 2015 RS.1,133.13 crore) carries interest rate in range of 6.75 % to 10 % pa. The CP has maturity period of 1 to 9 months period.

f) Factored receivables of RS.663.48 crore (previous year RS.379.79 crore and April 01, 2015 RS.449.67 crore) have recourse to the Company and interest liability on amount of bill discounted is borne by the customer. The maturity period of the transfer is 1 to 12 months period.

a) Assets taken under Operating Leases - an office space and residential houses for staff accommodation are generally obtained on operating leases except that stated under note (b) below. The lease rent terms are generally for an eleven months period and are renewable by mutual agreement. There are no sub-leases and leases are cancellable in nature except that mentioned under note (b) below. There are no restrictions imposed by the lease arrangements. There is no contingent rent in the lease agreements and there is no escalation clause in the lease agreements except that mentioned under note (b) below. Expenses of RS.4.24 crore (previous year RS.4.09 crore) incurred under such leases have been expensed in the statement of profit & loss.

b) Assets taken under Operating Leases

i) an office premises have been taken on operating leases. The lease rent terms are for the period of 15 years and are renewable by mutual consent. The Company has given deposit of RS.100 crore as per the terms one of the lease transaction. The lease agreement entered is non-cancellable for the period of first 3 years of the lease agreement. As per the lease agreement lease rental is escalated by 10% at every 5 years. There is no contingent rent, no sub-leases and no restrictions imposed by the lease arrangements. Expenses of RS.0.10 crore (previous year RS.0.10 crore) incurred under such lease have been expensed in the statement of profit and loss.

ii) Land for purpose of constructing corporate office has been taken on operating lease basis during the year. The lease term is for the period of 20 years and is renewable by the mutual consent. The lease agreement entered is non-cancellable for the period of first 5 years of the lease agreement. There is no contingent rent, no sub-leases and no restrictions imposed by lease arrangements. Rental charges of RS.3.54 crore incurred under such lease have been expensed in the statement of profit and loss.

iii) The Company has taken parcel of Land aggregating to 49,416 Sq. Mtrs on lease basis. The lease shall be for an initial period of 20 years with annual lease rent of RS.7 crore. A lease rent expenses of RS.3.50 crore (previous year NIL) has been expensed in the statement of profit and loss and the Company has also paid advance of RS.140 crore as per terms of agreement,

c) Payment to Auditors

* Note- Professional fee of RS.0.37 crore paid for the services rendered in respect of the Bond issued by the Company has been accounted as transaction cost in accordance with Ind AS 109 for the year ended March 31, 2017 and fee of RS.0.26 crore paid during the previous year ended March 31, 2016 has been adjusted against securities premium in accordance with section 52 of the Companies Act 2013.

d) Details of Expenditure on Corporate Social Responsibilities

g) The Company has been availing tax holiday benefit u/s 80IAB of the Income Tax Act, 1961 on the taxable income. However, in view of the amendment in Income Tax Act, 1961 w.e.f. April 1, 2011 by Finance Act 2011, the Company is liable to pay Minimum Alternate Tax (MAT) on income from the financial year 2011-12. Based on the amendment, the Company has made provision of RS.704.24 crore (previous year RS.624.34 crore) for current taxation based on its book profit for the financial year 2016-17 and has recognised MAT credit of RS.571.28 crore (previous year RS.607.82 crore) (read with note 38(l)) as the management believes, in view of strategic volumes of cargo available with the Company and higher depreciation charge for accounting purposes than the depreciation for income tax purposes in the future period, it is possible that the MAT credit will be utilized post tax holiday period w.e.f. financial year 2017-18.

h) The Company has following unutilised MAT credit under the Income Tax Act, 1961 for which deferred tax assets has been recongnised in the Balance Sheet at.

i) During the year ended March 31, 2016, the Company has paid dividend to its shareholders. This has resulted in payment of Dividend Distribution Tax (DDT) to the taxation authorities. The Company believes that DDT represents additional payment to taxation authority on behalf of the shareholders. Hence DDT paid is charged to equity.

6 DISCLOSURES AS REQUIRED BY IND AS - 19 EMPLOYEE BENEFITS

a) The company has recognised, in the Statement of Profit and Loss for the current year, an amount of RS.7.70 crore (previous year RS.6.41 crore) as expenses under the following defined contribution plan.

b) The company has a defined gratuity plan (funded) and is governed by the Payment of Gratuity Act, 1972. Under the Act, every employee who has completed at least five year of service is entitled to gratuity benefits on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with Life Insurance Company of India (LIC) in form of a qualifying insurance policy with effect from September 01, 2010 for future payment of gratuity to the employees.

Each year, the management reviews the level of funding in the gratuity fund. Such review includes the assets-liability matching strategy. The management decides its contribution based on the results of this review. The management aims to keep annual contributions relatively stable at a level such that no plan deficits (based on valuation performed) will arise.

The following tables summarise the component of the net benefits expense recognised in the statement of profit and loss account and the funded status and amounts recognized in the balance sheet for the respective plan.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled. There has been significant change in expected rate of return on assets due to change in the market scenario.

7 SEGMENT INFORMATION

The Company is primarily engaged in one business segment, namely developing, operating and maintaining the Ports services, Ports related Infrastructure development activities and development of infrastructure at contiguous Special Economic Zone at Mundra, as determined by chief operational decision maker, in accordance with Ind-AS 108 “Operating Segment”.

Considering the inter relationship of various activities of the business, the chief operational decision maker monitors the operating results of its business segment on overall basis. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss in the financial statements.

Terms and conditions of transactions with related parties

(i) Outstanding balances of related parties at the year-end are unsecured and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the year ended March 31, 2017, the Company has not recorded any impairment of receivables relating to amounts owed by related parties except provision has been made for loans given to subsidiaries of RS.15.51 crore (March 31, 2016 - NIL, April 01, 2015 - NIL). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

(ii) All loans are given on interest bearing within the range of 7.50 % to 11.50% except loan to Adani Logistics Limited; The Dhamra Port Company Limited; Dholera Infrastructure Private Limited; Dholera Port & Special Economic Zone Limited;Karnavati Aviation Private Limited; Adani Hospitals Mundra Private Limited whereby loan transaction amounting to RS.1,519.58 crore (previous year RS.1,005.14 crore) are interest free. During the year Company has granted relinquish current year on payment of interest on loan amounting to RS.2,671.64 crore given to certain subsidiaries, in earlier period and outstanding as at April 01,2016 i.e. Adani Ennore Container Terminal Private Limited; Adani Hazira Port Private Limited; Adani Kandla Bulk Terminal Private Limited; Adani Kattupalli Port Private Limited; Adani Murmugao Port Terminal Private Limited; Adani Vizag Coal Terminal Private Limited; Mundra SEZ Textile and Apparel Park Private Limited; Shanti Sagar International Dredging Private Limited and The Dhamra Port Company Limited to support the operation of these subsidiaries.

Notes:

(i) The names of the related parties and nature of the relationships where control exists are disclosed irrespective of whether or not there have been transactions between the related parties. For others, the names and the nature of relationships is disclosed only when the transactions are entered into by the Company with the related parties during the existence of the related party relationship.

(ii) Aggregate of transactions for the year ended with these parties have been given below.

8.1 Financial Risk objective and policies

The Company’s principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other payables, and financial guarantee contracts. The main purpose of these financial liabilities is to finance the Company’s operations/ projects and to provide guarantees to support its operations and its subsidiaries and jointly controlled entities. The Company’s principal financial assets include loans, investment including mutual funds, trade and other receivables, and cash and cash equivalents that derive directly from its operations. The Company also holds FVTOCI investments and enters into derivative transactions.

In the ordinary course of business, the Company is mainly exposed to risks resulting from exchange rate fluctuation (currency risk), interest rate movements (interest rate risk) collectively referred as Market Risk, Credit Risk, Liquidity Risk and other price risks such as equity price risk. The Company’s senior management oversees the management of these risks. It manages its exposure to these risks through derivative financial instruments by hedging transactions. It uses derivative instruments such as Cross Currency Swaps, Full Currency swaps, Interest rate swaps, foreign currency future options and foreign currency forward contract to manage these risks. These derivative instruments reduce the impact of both favourable and unfavourable fluctuations.

The Company’s risk management activities are subject to the management, direction and control of Central Treasury Team of the Company under the framework of Risk Management Policy for Currency and Interest rate risk as approved by the Board of Directors of the Company. The Company’s central treasury team ensures appropriate financial risk governance framework for the Company through appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. It is the Company’s policy that no trading in derivatives for speculative purposes may be undertaken.

The decision of whether and when to execute derivative financial instruments along with its tenure can vary from period to period depending on market conditions and the relative costs of the instruments. The tenure is linked to the timing of the underlying exposure, with the connection between the two being regularly monitored. The Company is exposed to losses in the event of non-performance by the counterparties to the derivative contracts. All derivative contracts are executed with counterparties that, in our judgment, are creditworthy. The outstanding derivatives are reviewed periodically to ensure that there is no inappropriate concentration of outstanding to any particular counterparty.

Further, all currency and interest risk as identified above is measured on a daily basis by monitoring the mark to market (MTM) of open and hedged position. The MTM is derived basis underlying market curves on closing basis of relevant instrument quoted on Bloomberg/Reuters. For quarter ends, the MTM for each derivative instrument outstanding is obtained from respective banks. All gain / loss arising from MTM for open derivative contracts and gain / loss on settlement / cancellation / roll over of derivative contracts is recorded in statement of profit and loss.

a) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk. Financial instruments affected by market risk include loans and borrowings, deposits, FVTOCI investments, short term Investments and derivative financial instruments.

The sensitivity analyses in the following sections relate to the position as at March 31, 2017 and March 31, 2016.

The sensitivity analyses have been prepared on the basis that the amount of net debt, the ratio of fixed to floating interest rates of the debt and derivatives and the proportion of financial instruments in foreign currencies are all constant as at March 31, 2017. The analyses exclude the impact of movements in market variables on: the carrying values of gratuity and other post-retirement obligations; provisions.

The following assumptions have been made in calculating the sensitivity analyses:

The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at March 31, 2017 and March 31, 2016.

(i) Interest rate risk

The Company is exposed to changes in market interest rates due to financing, investing and cash management activities. The Company’s exposure to the risk of changes in market interest rates relates primarily to The Company’s long-term debt obligations with floating interest rates and period of borrowings. The Company manages its interest rate risk by having a balanced portfolio of fixed and variable rate loans and borrowings. The Company enters into interest rate swap contracts or interest rate future contracts to manage its exposure to changes in the underlying benchmark interest rates.

Interest rate sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected. With all other variables held constant, the Company’s profit before tax is affected through the impact on floating rate borrowings, as follows:

If interest rates had been 50 basis points higher / lower and all other variables were held constant, the Company’s profit for the year ended March 31, 2017 would decrease / increase by RS.39.49 crore (previous year RS.19.76 crore). This is mainly attributable to interest rates on variable rate long term borrowings.

(ii) Foreign currency risk

Exchange rate movements, particularly the United States Dollar (USD) and Euro (EUR) against Indian Rupee (INR), have an impact on the Company’s operating results. The Company manages its foreign currency risk by entering into currency swap for converting INR loan into other foreign currency for taking advantage of lower cost of borrowing in stable currency environment. The Company also enters into various foreign exchange contracts to mitigate the risk arising out of foreign exchange rate movement on foreign currency borrowings or trade payables. Further, to hedge foreign currency future transactions in respect of which firm commitment are made or which are highly probable forecast transactions (for instance, foreign exchange denominated income) the Company has entered into foreign currency forward contracts as per the policy of the Company,

The carrying amounts of the Company’s foreign currency denominated monetary items are as follows:

The above table represents total exposure of the Company towards foreign exchange denominated liabilities (net). The details of exposures hedged using forward exchange contracts are given as a part of Note 32(a) and the details of unhedged exposures are given as part of Note 32(b).

The Company is mainly exposed to changes in USD, EURO, AUD and JPY. The below table demonstrates the sensitivity to a 1% increase or decrease in the respective foreign currency rates against INR, with all other variables held constant. The sensitivity analysis is prepared on the net unhedged exposure of the Company as at the reporting date. 1% represents management’s assessment of reasonably possible change in foreign exchange rate.

(III) Equity price risk

The Company’s non-listed equity securities are susceptible to market price risk arising from uncertainties about future values of the investment securities. The Company manages the equity price risk through diversification and by placing limits on individual and total equity instruments. Reports on the equity portfolio are submitted to the Company’s senior management on a regular basis. The Company’s Board of Directors reviews and approves all equity investment decisions.

The Company has given corporate guarantees and pledged part of its investment in equity in order to fulfil the collateral requirements of the subsidiaries and jointly controlled companies. The counterparties have an obligation to return the guarantees/ securities to the Company. There are no other significant terms and conditions associated with the use of collateral.

b) Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables and other financial assets) and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.

Customer credit risk is managed by the Company’s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on an extensive evaluation and individual credit limits are defined in accordance with this assessment.

An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The calculation is based on exchange losses historical data.

Credit risk from balances with banks and financial institutions is managed by the Company’s treasury department in accordance with the Company’s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the Company’s Board of Directors on an annual basis, and may be updated throughout the year subject to approval of the Company’s Finance Committee. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through counterparty’s potential failure to make payments.

Concentrations of Credit Risk form part of Credit Risk

Considering that the Company operates the port services and related infrastructure contiguous to Port at Mundra, the Company is significantly dependent on cargo from or to such large port user customer located at Mundra. Out of total revenue, the Company earns RS.2,102.22 crore of revenue during the year ended March 31, 2017 (previous year RS.1,692.66 crore) from such port users which constitute 66% (previous year 60%). Accounts receivable from such customer approximated RS.744.31 crore as at March 31, 2017 and RS.707.93 crore as at March 31, 2016. A loss of these customer could adversely affect the operating result or cash flow of the Company,

c) Liquidity Risk

Liquidity risk is the risk that the Company will encounter difficulty in raising funds to meet commitments associated with financial instruments that are settled by delivering cash or another financial asset. Liquidity risk may result from an inability to sell a financial asset quickly at close to its fair value.

The Company has an established liquidity risk management framework for managing its short term, medium term and long term funding and liquidity management requirements. The Company’s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. The Company manages the liquidity risk by maintaining adequate funds in cash and cash equivalents. The Company also has adequate credit facilities agreed with banks to ensure that there is sufficient cash to meet all its normal operating commitments in a timely and cost-effective manner.

The table below analysis derivative and non-derivative financial liabilities of the Company into relevant maturity groupings based on the remaining period from the reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

8.2 Capital management

For the purposes of the company’s capital management, capital includes issued capital and all other equity. The primary objective of the company’s capital management is to maximize shareholder value. The company manages its capital structure and makes adjustments in the light of changes in economic environment and the requirements of the financial covenants.

The company monitors capital using gearing ratio, which is net debt (total debt less cash and bank balance) divided by total capital plus net debt.

In order to achieve this overall objective, the Company’s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current period.

No changes were made in the objectives, policies or processes for managing capital during the years ended March 31, 2017 and March 31, 2016.

9 Information required to be furnished as per Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) and Schedule III the Companies Act, 2013 for the year ended March 31, 2017. This information has been determined to the extent such parties have been identified on the basis of information available with the Company and relied upon by auditors.

10 Detail of Capital Work in Progress including certain expenses of revenue nature allocable to New Projects and Capital Inventory, consequently expenses disclosed under the respective notes are net of such amount.

11 CAPITAL COMMITMENTS AND OTHER COMMITMENTS

Capital Commitments

Other Commitments

a) The port projects of subsidiary companies viz. Adani Hazira Port Private Limited, Adani Petronet (Dahej) Port Private Limited, Adani Murmugao Port Terminal Private Limited (“AMPTPL’), Adani Vizag Coal Terminal Private Limited, The Dhamra Port Company Limited (“DPCL”) and jointly controlled entity Adani International Container Terminal Private Limited (“AICTPL”) have been funded through various credit facility agreements with banks. Against the said facilities availed by the aforesaid entities from the banks, the Company has executed a Sponsor Undertaking and Pledge Agreements whereby 51% of the holding would be retained by the Company (In case of AICTPL jointly with the Joint Venture partner) at all points of time. Further, the Company is also required to pledge 30% (26% from the date of commencement of the operation) of its shareholding in the respective entities. (In case of AICTPL, jointly with Joint Venture partner of which 12.98% share held by Joint Venture partner are yet to be pledged with bank).

b) Contract/ Commitment for purchase of certain supplies. Advance given RS.251.81 crore (previous year RS.300 crore)

c) The Company has, through its subsidiary Adani Kattupalli Port Private Limited (AKPPL), entered into an in principle agreement on November 01, 2015 for strategic acquisition of the Kattupalli Port in Tamil Nadu from L&T Shipbuilding Limited (LTSB) a subsidiary of Larsen & Toubro Limited. The transaction is subject to receiving the necessary government and regulatory approvals and the port business being demerged from LTSB. While awaiting all the necessary approvals, APSEZ through its subsidiary AKPPL has an arrangement to operate the Port w.e.f November 01, 2015 through AKPPL.

12 ASSETS HELD FOR SALE

The Board of Directors of the Company in their meeting held on February 14, 2017 has approved to transfer Maintenance Dredging Operations of the Company consisting of fleet of dredgers and relevant support facilities to Shanti Sagar International Dredging Private Limited, a wholly owned subsidiary. The Business Transfer Agreement has been entered between the parties on April 1, 2017 to transfer the following assets and liabilities of the Maintenance Dredging Operations to the subsidiary at a consideration of RS.96.00 crore:

Considering the management’s consideration to transfer the aforesaid assets to its wholly owned subsidiary, the relevant property, plant and equipment of RS.93.12 crore has been classified as ‘Asset Held for Sale’ (refer note 8).

13 The following are the details of loans and advances in the nature of loans given to subsidiaries, associates and other entities in which directors are interested in terms of regulation 53 (F) read together with para A of Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

14 a) The Company has entered into preliminary agreement with one of the party for development and maintenance of Liquefied Natural Gas (LNG) terminal infrastructure facilities at Mundra (Mundra LNG Project) vide agreement dated September 30, 2014. The Company had during the quarter ended September 30, 2014, recognised project service revenue of RS.200 crore pending conclusion of definitive agreement towards land reclamation based on the activities completed. Based on the agreement the Company and the party are still in the process of concluding a definitive agreement for Mundra LNG Project relating to development and lease of infrastructure facilities (including lease of land)


Mar 31, 2015

1 The Cash Flow Statement has been prepared under the Indirect method as set out in Accounting Standard-3 on Cash Flow Statements notified by the Companies Accounting Standard Rule 2006 (as amended).

2 Previous year''s figures have been regrouped where necessary to confirm to this year''s classification.

3 During the year ended March 31,2015, the Company has converted interest free loan Rs 500.00 crore given to a wholly owned subsidiary (The Dhamra Port Company Limited) into equity shares of Rs 500.00 crore equivalent to 50,00,00,000 equity shares of Rs 10 each. In the previous year ended March 31, 2014, the Company has converted interest free loan of Rs 346.32 crore given to a wholly owned subsidiary into advance towards share application money and interest bearing loan of Rs 248.00 crore given to a fellow subsidiary into capital advance and interest bearing loan of Rs 307.00 crore given to a third party into capital advance. Thus the impact of these transactions have not been given in the cash flow statement.

1. Corporate information

Adani Ports and Special Economic Zone Limited (''the Company'', ''APSEZL'') is in the business of development, operations and maintenance of port infrastructure has linked multi product Special Economic Zone (SEZ) and related infrastructure contiguous to Mundra port. The initial port infrastructure facilities at Mundra including expansion thereof through development of additional terminals and south port infrastructure facilities are developed pursuant to the concession agreement with Government of Gujarat (GoG) and Gujarat Maritime Board (GMB) for 30 years period effective from February 17, 2001. The Company has expanded port infrastructure facilities through approved supplementary concession agreement (pending to be concluded) which will be effective till the year 2040, whereby port infrastructure has been developed at Wandh, Mundra to handle coal cargo. The said agreement is in the process of getting signed with GoG and GMB although the part of the Coal terminal at Wandh is recognised as commercially operational w.e.f. February 1,2011.

The Container terminal facilities (CT-1) initially developed by the Company was transferred under sub- concession agreement between Mundra International Container Terminal Limited (MICTL) (erstwhile Adani Container (Mundra)Terminals Limited) and APSEZL entered into, on January 7, 2003 wherein APSEZL has given rights to MICTL to handle the container cargo for a period of 28 years i.e. up to February 17, 2031. Similarly container facilities developed as South Port location (CT-3) has been leased under approved sub concession agreement dated October 17, 2011 to (50:50) joint venture company, Adani International Container Terminal Private Limited (AICTPL) co-terminate with main concession agreement with GMB. The sub-concession agreement is pending to be concluded with GOG and GMB.

The Multi Product Special Economic Zone at Mundra is developed by the Company as per approval of Government of India vide their letter no. F-2/11/2003/EPZ dated April 12, 2006 as amended from time to time till date. The Company has also taken approval of Ministry of Commerce and Industry to set up Free Trade and Warehousing Zone vide letter no. F.1/16/2011-SEZ dated January 04, 2012. Subsequent to year end, the Company has received approval from Ministry of Commerce and Industry for setting up of additional Multi Product Special Economic Zone at Mundra taluka over an area of 1,856 hectares.

2. Basis of Preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under section 133 of the Companies Act 2013 read with paragraph 7 of the Companies (Accounts) Rules, 2014. The financial statements have been prepared on an accrual basis under the historical cost convention. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year except for the change in accounting policy explained below.

b. Terms/rights attached to equity shares

The company has only one class of equity shares having a par value of Rs. 2 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The final dividend recommended by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

For the current financial year 2014-15 the amount of proposed dividend per share distribution to equity shareholders is Rs 1.10 (for the previous financial year dividend per share Rs 1.00).

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

c. Terms of Non-cumulative redeemable preference shares

The Company has outstanding 28,11,037 0.01% Non-Cumulative Redeemable Preference Shares (''NCRPS'') of Rs 10 each issued at a premium of Rs 990 per share. Each holder of preference shares has a right to vote only on resolutions placed before the company which directly affects the right attached to preference share holders. These shares are redeemable on March 28, 2024 at an aggregate premium of Rs 278.29 crore (equivalent to Rs 990.00 per share). The Company credits the redemption premium on proportionate basis every year to Preference Share Capital Redemption Premium Reserve and debits the same to Securities Premium Account as permitted by Section 52 of the Companies Act, 2013.

In the event of liquidation of the Company, before redemption the holder of NCRPS will have priority over equity shares in the payment of dividend and repayment of capital.

d. Shares held by holding/ultimate holding company and/or their subsidiaries/associates

Out of equity shares issued by the company, shares held by its holding company, are as below:

As per records of the company, including its register of shareholders/members and other declarations received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownerships of shares.

1 Debentures include Secured Non-Convertible Redeemable Debentures amounting to Rs 1,999.00 crore (previous year Rs 1,289.00 crore) are secured by first Pari-passu charge on all the immovable and movable assets of Multi-purpose, Terminal-II and Container Terminal -II project assets & first specific charge over land ( valued at market value )

2 Debentures include Secured Non-Convertible Redeemable Debentures aggregating to Rs 645.00 crore (previous year Rs 704.00 crore) are secured by exclusive mortgage and charge on entire Single Point Mooring (SPM) facilities serving Indian Oil Corporation Limited - Mundra and the first charge over receivables from Indian Oil Corporation Limited.

3 Debentures include Secured Non-Convertible Redeemable Debentures aggregating to Rs 1,000 crore (previous year Nil) are secured by first specific charge over 138 hectares land situated at Navinal Island, Mundra Taluka, Kutch District, Gujarat (valued at market value).

Debentures include Secured Non-Convertible Redeemable Debentures aggregating to Rs 500 crore (previous year Nil) are secured by first specific charge over 79 hectares land situated at Mundra Taluka, Kutch District , Gujarat (valued at market value).

4 Foreign currency loan aggregating to Rs Nil crore (previous year Rs 57.64 crore) carried interest @ 6M Libor plus basis point in range of 165 to 315. The loan was secured by exclusive charge on the Dredgers.

5 Foreign currency loan aggregating to Rs 255.84 crore (previous year Rs 373.74 crore) carries interest @ 6M Euribor plus basis point in the range of 95 to 140. Further, out of the above loan Rs 222.65 crore is repayable in 15 semi-annual installments of approx Rs 14.84 crore, loan Rs 23.70 crore is repayable in 4 semi-annual equal installments of Rs 5.92 crore, Rs 9.49 crore is repayable in 3 semiannual equal installment of Rs 3.16 crore from the balance sheet date. The loan is secured by exclusive charge on the Dredgers procured under the facility.

6 Foreign Currency loan aggregating to Rs 30.94 crore (previous year Rs 44.49 crore) carries interest @ 6M Libor plus 225 basis point. The loan is repayable in 8 quarterly equal installments of Rs 3.86 crore from the balance sheet date .The loan is secured by exclusive charge on the dredgers and is further secured by way of second pari passu charge on the entire movable and immovable fixed assets pertaining to Multipurpose, Terminal-II and Container Terminal-II project assets and Single Point Mooring.

7 Foreign currency loans aggregating to Rs 102.07 crore (previous year Rs 143.59 crore) carries interest @ 6M Euribor plus 75 basis point. The loan is repayable in 14 semi annually equal installments of Rs 7.30 crore from the balance sheet date. The loan is secured by exclusive charge on the Cranes purchased under the facility.

8 Foreign Currency Loans from Banks aggregating to Rs 1,879.69 crore (previous year Rs 1,881.33 crore) is secured by the first pari passu charge on all the immovable and movable assets pertaining

to Multipurpose Terminal, Terminal-II, Container Terminal-II, project assets of the company and carry interest @ 6M Libor plus basis point in range of 300 to 380. Further, out of the above loan as aggregating to Rs 520.31 crore are repayable in 13 Quarterly equal installments of approx Rs 40.02 crore from the balance sheet date, Rs 937.50 crore are repayable in 3 annual equal installments of Rs 312.50 crore starting repayment year 2015-16, Rs 171.88 crore are repayable in 11 semi-annual equal installments of Rs 15.62 crore from the date of the balance sheet. The balance amount of Rs 250 crore is bullet repayment on maturity of the loan in 2016.

9 Foreign currency loans from bank aggregating to Rs 275.00 crore (previous year Rs 290.59 crore) is secured by first pari passu charge on all the movable and immovable assets pertaining to Coal terminal project assets at Wandh and carries interest @ 3 Months Libor plus basis point in range of 310 to 380. These loans are repayable in 17 quarterly equal installments of approx Rs 16.17 crore from the balance sheet date.

10 Foreign currency Loans from bank aggregating to Rs 1,875.00 crore (previous year Rs 1,797.45 crore) carries interest @ 3M Libor plus basis point in range of 310 to 370, is repayable in 3 equal installments of Rs 208.33 crore and Rs 416.67 crore each starting repayment year 2015-16 and 2016-17 respectively. These loans are secured by first pari passu charge on all the movable and immovable assets pertaining to Coal Terminal project assets at Wandh and specific charge over land admeasuring to 175 hectares situated at Mundra Taluka, Kutch District, Gujarat.

11 Foreign Currency Loans from Banks aggregating to Rs 97.64 crore (previous year Rs 125.47 crore) carries interest @ 4.6% p.a . Out of these loans, Rs 43.91 crore are repayable in 12 semi-annual equal installments of approx Rs 3.65 crore, Rs 16.39 crore are repayable in 13 semi-annual equal installments of Rs 1.26 crore, Rs 18.44 crore are repayable in 14 semiannual equal installments of Rs. 1.31 crore, Rs 18.91 crore are repayable in 15 semi-annual equal installments of Rs 1.26 crore from the balance sheet date. These loans are secured by exclusive charge on the individual Tug.

12 Foreign currency loan aggregating to Rs 210.94 crore (previous year Rs 232.17 crore) carries interest @ 6M Libor plus 300 to 330 basis point . The loan is repayable in 27 quarterly equal installments of approx. Rs 7.81 crore from the balance sheet date. The loan are secured by first Pari-passu charge on all the immovable and movable assets of Multipurpose, Terminal-II and Container Terminal-II project assets.

13 Foreign currency Loans from bank aggregating to Rs 250.00 crore (previous year Rs 239.66 crore) is secured by first pari passu charge on all the movable and immovable assets pertaining to Coal terminal project assets at Wandh and carries interest @ 3M Libor plus basis point in range of 260 to 310. The Loan is repayable in single installment on maturity in year 2017-18.

14 Foreign Currency Loan aggregating to Rs 134.38 Crore (previous year Rs 165.37 Crore) carries interest @ 6 months Euribor plus a margin of 290 basis point. This loan is secured by first pari- passu charge on movable and immovable assets pertaining to Multipurpose, Terminal-II and Container Terminal-II project assets. The loan is repayable in 16 semi- annual equal installments of Rs 8.40 crore starting from year 2015-16.

15 Foreign Currency Loan aggregating to Rs 312.50 Crore (previous year Rs 299.58 Crore) carries interest @ 3 month libor plus 300 basis point. This loan is secured by First pari-passu charge on movable and immovable assets pertaining to coal terminal project assets. The Loan is repayable in single installment on maturity in year 2018-19.

16 Rupee Term Loan from bank aggregating to Rs 102.00 crore (previous year Rs 114.00 crore) is secured by first pari passu charge on all the movable and immovable assets pertaining to Agripark project assets and carries interest @ 10.25% p.a. The loan is repayable in 18 quarterly equal installments of Rs 5.67 crore from the balance sheet date.

17 Rupee term loan amounting to Rs 450.00 crore (previous year Rs 475.00 crore) are secured by exclusive charge on land parcel of 90 hectares situated at Mundra Taluka, Kutch District, Gujarat. The loan is repayable in 10 semi-annual equal installments of Rs 45.00 crore from the balance sheet date.

18 Rupee term loan amounting to Rs 200.00 crore (previous year Nil) for which charge creation on Multi-purpose Terminal, Termianal II and Container Terminal II (Excluding immoveble assets relating to SPM project, west basin, south basin and SEZ land) is under process. The Loan is repayable in 2 semi- annual equal installments of Rs 100.00 crore from the balance sheet date.

19 Suppliers bills accepted under foreign currency letters from bank aggregating to Rs Nil crore (previous year Rs 17.68 crore) carries interest @ 6 M Libor plus basis point in range of 100 to 310 The Loan was secured against exclusive charge on the goods, materials, assets acquired or procured under the facility.

20 Suppliers bills accepted under foreign currency letters of credit aggregating to Rs 94.88 crore (previous year Rs 100.02 crore) carries interest @ 6M Libor plus basis point in range of 100 to 200 which is repayable on maturity in 2015-16. The loan is secured against exclusive charge on assets purchased under the facility.

21 Suppliers bills accepted under foreign currency letters of credit aggregating to Rs 26.71 crore (previous year Nil crore) carries interest @ 6M Libor plus basis point in range of 35 to 105 which is repayable on maturity in 2015-16. The loan is secured against exclusive charge on fixed assets purchased under the facility.

22 a) Rupee term loan of Rs Nil (previous year Rs 125.00 crore) carries interest @ 11% p.a. The loan was unsecured.

b) Foreign Currency Loan aggregating of Rs 18.44 crore (previous year Rs 24.64 crore) carries interest @ 2.12 % p.a. The outstanding loan amount is repayable in 10 semi- annual equal installment of Rs 1.84 crore from the balance sheet date. The loan is unsecured .

Note: Operational Claims are the expected claims against outstanding receivables made/to be made by the customers towards shortages of stock, handling losses, damages to the cargo, storage and other disputes. The probability and the timing of the outflow / adjustment with regard to above depends on the ultimate settlement / conclusion with the respective customer.

1 Suppliers bills accepted under foreign currency letters of credit aggregating to Rs 119.85 crore (previous year Rs 94.49 crore) carries interest @ 6M Libor plus basis point in range of 49 to 105 which are repayable on maturity in 2015-16. The loan is secured against exclusive charge on assets and materials purchased under the facility.

2 Supplier Bills aggregating to Rs 35.03 crore ( previous year Rs 86.06 crore) carries interest @ 6M Libor plus basis point in range of 65 to 170 and one year libor plus basis point in range of 100-225 which is repayable on maturity in 2015-16. The loan is secured against subservient charge on movable fixed assets and current assets except those secured by exclusive charge in favour of other lenders.

1) Aggregate cost of unquoted investments as at March 31, 2015Rs.4,762.28 crore (previous year- Rs 1,786.26 crore).

2) No. of Shares pledged with banks against borrowings by the respective companies as per below.

Capital advance includes Rs 64.87 crore (previous year Rs 369.91 crore) paid to various private parties and government authorities for acquisition of land.

The Company has bank guarantees of Rs 42.64 crore (previous year Rs 8.76 crore) against capital advances.

The Company has granted interest bearing inter-corporate loans and deposits aggregating Rs 2,137.87 crore (previous year Rs 1,999.67 crore) (including renewals on due dates) as at March 31, 2015 to its subsidiaries and other related parties, excluding loans granted to subsidiaries towards funding of development of specific ports and related infrastructure. The funds are advanced based on the business needs and exigencies and other cases to invest surplus fund or gave deposits to avail future commercial benefits with an option to purchase underlying assets.

Further, the Company has also extended inter-corporate deposits aggregating Rs 1,261.35 crore (previous year Rs 1,666.10 crore (including renewals on due dates) to third parties. The deposits are given at prevailing market interest rates. The inter-corporate deposits have been approved by the Finance committee of the Board of Directors .

The Company has received adequate undertaking on record to safeguard the full recovery of this amount together with the interest. In the opinion of the Company, all these loans /deposits are considered good and realisable as at the year end .

Note: a) Assets taken under Operating Leases - Office space and residential houses for staff accommodation are generally obtained on operating leases. The lease rent terms are generally for eleven months period and are renewable by mutual agreement. There are no sub-leases and leases are cancellable in nature except that mentioned under note b) below. There are no restrictions imposed by the lease arrangements. There is no contingent rent in the lease agreements and there is no escalation clause in the lease agreements except that mentioned under note b) below. Expenses of Rs 3.33 crore (previous Year Rs 3.34 crore) incurred under such leases have been expensed in the statement of profit & loss.

b) Assets taken under Operating Leases - One office premises have been taken on operating leases. The lease rent terms are for the period of 15 years and are renewable by mutual consent. The lease agreement entered is non-cancellable for the period of first 3 years of the lease agreement. As per the lease agreement lease rental is escalated by 10% at every 5 years. There is no contingent rent, no sub-leases and no restrictions imposed by the lease arrangements. Expenses of Rs 0.10 crore (previous year Rs 0.05 crore) incurred under such lease have been expensed in the statement of profit and loss.

Future minimum rentals payable under non-cancellable operating leases are as follows: *

* Rs 0.34 crore paid for professional fee for services rendered in respect of Institutional Placement Program (IPP) of the Company, was adjusted against securities premium in accordance with Section 78 of the Companies Act 1956. (also refer note -4)

23. Details of employee benefits

1. The company has recognised, in the statement of profit and loss for the current year, an amount of Rs 5.54 crore (previous year Rs 4.69 crore) as expenses under the following defined contribution plan.

2. The Company has a defined gratuity plan. Every employee who has completed at least five years of services gets a gratuity on departure @ 15 days salary (last drawn basic salary) for each completed year of service. The scheme is funded with Life Insurance Corporation of India (LIC) in the form of a qualifying insurance policy.

The following tables summaries the components of net benefit expense recognised in the Statement of Profit and Loss and the funded status and amounts recognised in the balance sheet for the respective plans.

Note:

1) The present value of the plan assets represents the balance available with the LIC as at the end of the period. The total value of plan assets amounting to Rs 8.73 crore (previous year Rs 6.86 crore) is as certified by the LIC.

2) The Company''s expected contribution to the fund in the next financial year is Rs 4.08 crore (previous year 2.08 crore)

The estimates of future salary increases considered in actuarial valuation and take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

The overall expected rate of return on assets is determined based on the market price prevailing on that date, applicable to the period over which the obligation has to be settled. There has been change in expected rate of return on asset due to change in the market scenario.

24. Segment Information

The Company is primarily engaged in the business of developing, operating and maintaining the Port and Port based related infrastructure services including Multi product Special Economic Zone at port location. The entire business has been considered as a single segment in terms of Accounting Standard- 17 on Segment Reporting notified under the Companies (Accounting Standard) Rule 2006 (as amended). There being no business outside India, the entire business has been considered as single geographic segment.

25. Related Party Disclosures

The Management has identified the following entities and individuals as related parties of the Company for the year ended March 31, 2015 for the purposes of reporting as per (AS) 18 - Related Party Transactions, which are as under:

A. Related parties where control exists.

Trust Controlling Holding Company : S.B. Adani Family Trust

Holding Company : Adani Enterprises Ltd.

Subsidiary Companies :

Mundra SEZ Textile and Apparel Park Pvt. Ltd.

MPSEZ Utilities Pvt. Ltd.

Adani Logistics Ltd.

Karnavati Aviation Pvt. Ltd.

Adani Murmugao Port Terminal Pvt. Ltd.

Mundra International Airport Pvt. Ltd.

Adani Hazira Port Pvt. Ltd.

Adani Petronet (Dahej) Port Pvt. Ltd.

Adani Vizag Coal Terminal Pvt. Ltd.

Adani Kandla Bulk Terminal Pvt. Ltd.

Adani Warehousing Service Pvt. Ltd.

Adani Ennore Container Terminal Pvt. Ltd.

Adani Hospitals Mundra Pvt. Ltd.

The Dhamra Port Company Ltd. ( w.e.f. June 23, 2014)

Mundra Solar Technopark Pvt. Ltd.* (w.e.f. March 10, 2015)

Entity held through Controlling Interest : Adinath Polyfills Pvt. Ltd.

Step down Subsidiary :

Hazira Infrastructure Pvt. Ltd.

Hazira Road Infrastructure Pvt. Ltd.

B. Related parties with whom transaction have been taken place during the year.

Joint Venture :

Adani International Container Terminal Pvt. Ltd.

Adani CMA Mundra Terminal Pvt. Ltd. (w.e.f. July 30, 2014)

Associate Dholera Infrastructure Pvt. Ltd.

Fellow Subsidiary Adani Power Ltd.

Adani Power Dahej Ltd.

Adani Mining Pvt. Ltd.

Adani Gas Ltd.

Chemoil Adani Pvt. Ltd.

Adani Global FZE, Dubai Adani Infra (India) Ltd.

Adani Power Rajasthan Ltd.

Adani Welspun Exploration Ltd.

Kutchh Power Generation Ltd.

Adani Agri Fresh Ltd.

Adani Power Maharashtra Ltd.

Adani Properties Pvt. Ltd.

Key Management Personnel

Mr. Gautam S. Adani, Chairman and Managing Director

Mr. Rajeeva Ranjan Sinha, Whole time Director (up to May 16, 2014)

Mr. Sudipta Bhattacharya, Whole time Director ( w.e.f. May 15, 2014)

Dr. Malay R. Mahadevia, Whole time Director

Relative of Key Management Personnel

Mr. Rajesh S. Adani, Director

Entities over which Key Management Personnel, Directors and their relatives are able to exercise Significant Influence

Adani Institute of Infrastructure Management Adani Wilmar Ltd.

Shanti Builders Adani Foundation Adani Shipyard Pvt. Ltd.

Dholera Port and Special Economic Zone Ltd.

Mundra Port Pty Ltd., Australia

Abbott Point Port Holdings Pte Ltd., Singapore

* These entities have been incorporated/formed during the year.

# The entity is acquired during the year.

Aggregate of transactions for the year ended with these parties have been given below.

Sub Notes:

1 The names of the related parties and nature of the relationships where control exists are disclosed irrespective of whether or not there have been transactions between the related parties. For others, the names and the nature of relationships is disclosed only when the transactions are entered into by the Company with the related parties during the existence of the related party relationship.

2 Pass through transaction/payable relating to railway freight, water front charges and other payable to third parties have not been considered for the purpose of related party disclosure.

3 For the purpose of comparison, the previous year''s transactions have been re-classified in the current year.

Note:

1. The Company has allowed to some of its subsidiaries to avail non fund based bank guarantee facilities out of its credit facilities. The aggregate of such transactions amount Rs 471.41 crore (previous year Rs 538.99 crore) is not disclosed in above schedule.

2. During the previous year, the company converted loan of Rs 346.32 crore given to Adani Hazira Port Pvt Ltd. into share application money out of which equity share of Rs 280.85 crore was issued by subsidiary company during the previous year and Rs 65.47 crore in the current year. Similary loan amount of Rs 500.00 crore given to The Dhamra Port Company Limited, got converted into equity shares of Rs 500.00 crore, issued by the subsidiary company during the year.

26. Details as per Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act).This information has been determined to the extent such parties have been identified on the basis of information available with the Company.

27. The Company avails tax holiday benefit u/s 80IAB of the Income Tax Act, 1961 on the taxable income. However, in view of the amendment in Income Tax Act, 1961 w.e.f. April 1,2011 by Finance Act, 2011, the Company is liable to pay Minimum Alternate Tax (MAT) on income from the financial year 2011-12. Based on the amendment, the Company has made provision of Rs 450.60 crore (previous year Rs 463.63 crore) for current taxation based on its book profit for the financial year 2014-15 and considered credit for MAT of Rs 510.79 crore (previous year Rs 387.37 crore) (read with note 37(o)) as the management believes, it has convincing evidence in view of strategic volumes of cargo available with the Company and higher depreciation charge for accounting purposes than the depreciation for income tax purposes in the future period, whereby, the MAT credit will be utilized post tax holiday period.

28. During previous year ended March 31, 2014, the revenue from operations include the income from sale/ sub-lease of core port assets i.e. port container infrastructure, upfront infrastructure development fee and proportionate portion of deferred usages charges aggregating to Rs 890.92 crore on transfer of port terminal assets to Adani International Container Terminal Private Limited ("AICTPL"), a (50:50) Joint Venture entity between the Company and Mundi Limited. The corresponding related costs to the income were shown under head "Operating Expenses" and the value of port equipments and other miscellaneous assets related to port terminal sold to AICTPL was netted against the cost in the books of account as such assets were being acquired specifically for AICTPL and transferred on cost basis. The value of such asset was Rs 597.67 crore.

29. Detail of Capital Work in Progress including certain expenses of revenue nature allocable to New Projects and Capital Inventory, consequently expenses disclosed under the respective notes are net of such amount .

Other Commitments

a) The port projects of subsidiary companies viz. Adani Hazira Port Private Limited, Adani Petronet (Dahej) Port Private Limited, Adani Murmugao Port Terminal Private Limited ("AMPTPL"), Adani Vizag Coal Terminal Private Limited, The Dhamra Port Company Limited ("DPCL") and joint venture company Adani International Container Terminal Private Limited ("AICTPL") have been funded through various credit facility agreements with banks. Against the said facilities availed by the subsidiary companies/joint venture company from the banks, the Company has executed a Sponsor Undertaking and Pledge Agreements whereby 51% of the holding would be retained by the Company at all points of time. Further, the company is also required to pledge 30% (26% from the date of commencement of the operation) of its shareholding in the respective entities. The details of shareholding pledged by the Company is as follows :

b) In terms of arrangement with Adani Enterprises Limited, the holding company, the Company has proposed to purchase equity share and consequential economic interest / ownership rights thereunder in respect of Adani Murmugao Port Terminal Private Limited, subsidiary company where equity shares to the extent of 26% are also held by holding company. The Company is in the process of obtaining regulatory approvals to get the share transferred in it''s own name. In the meantime, the Company has advanced unsecured loans to this subsidiary as promoter''s contribution for funding the ongoing projects.

c) The Company has entered into an agreement / MOU with the Holding Company to either purchase or lease corporate office space of 5 lacs square feet. The Company has given deposit of Rs 250 crore as per the agreement / MOU to secure its rights till March 31,2017.

Particulars As at As at March 31,2015 March 31,2014

Corporate Guarantees given to banks and financial institutions against credit 1,595.51 787.77 facilities availed by the subsidiaries and joint venture entities. Amount outstanding there against Rs 1,515.68 crore (previous year Rs 727.09 crore)

Corporate Guarantee given to a bank for credit facility availed by Port Pty Ltd, (Refer note p) (Refer note p) erstwhile subsidiary company, Mundra Australia read with note (p) below. (Amount outstanding there against Rs 3,043.75 crore (previous year Rs 4,793.20

Bank Guarantees and Letter of Credit facilities availed by the subsidiaries 471.41 538.99 against credit facilities sanctioned to the Company.

Bank Guarantees given to government 129.01 121.68 authorities and banks (also includes DSRA bank guarantees given to bank on behalf of subsidiaries and erstwhile subsidiaries.)

Civil suits filed by the Customers for 0.94 30.49 recovery of damages against certain performance obligations. The said civil suits are currently pending with various Civil Courts in Gujarat. The management is reasonably confident that no liability will devolve on the Company in this regard and hence no provision is made in the books of accounts towards these suits.

Show cause notices from the Custom 0.19 0.46 Authorities against duty on port related cargo. The Company has given deposit of Rs 0.05 crore (previous year Rs 0.05 crore) against the demand. The management is reasonably confident that no liability will devolve on the Company and hence no liability has been recognised in the books of accounts.

Customs department notice for wrongly availing 0.25 0.25 duty benefit exemption under DFCEC Scheme on import of equipment.

The Company has filed its reply to the show cause notice with Deputy Commissioner of Customs, Mundra and Commissioner of Customs, Mumbai against order in original. The management is of view that no liability shall arise on the Company.

Various show cause notices received from 111.80 101.64 Commissioner/ Additional Commissioner/ Joint Commissioner/ Deputy Commissioner of Customs and Central Excise, Rajkot and Commissioner of Service Tax, Ahmedabad, for wrongly availing of Cenvat credit/ Service tax credit and Education Cess credit on input services and steel, cement and other misc. fixed assets during financial year 2006-07 to 2014-15. The Excise department has demanded recovery of the duty along with penalty and interest thereon. The Company has given deposit of Rs 4.50 crore (previous year: Rs 4.50 crore) against the demand. The matters are pending before High Court of Gujarat, Commissioner of Central Excise (Appeals), Rajkot and Commissioner of Service Tax, Ahmedabad. The Company has taken an external opinion in the matter based on which the management is of the view that no liability shall arise on the Company. Subsequent to year end, the Company has received favourable order from High Court of Gujarat against demand in respect of dispute relating to financial year 2005-06.

Show cause notices received from Commissioner of 6.90 6.90 Customs and Central Excise, Rajkot in respect of levy of service tax on various services provided by the Company and wrong availment of CENVAT credit by the Company during financial year 2009-10 to 2011-12. The matter is currently pending at High Court of Gujarat Rs 6.72 crore (previous year Rs 6.72 crore); and Customs, Excise and Service Tax Appellate Tribunal, Ahmedabad Rs 0.15 crore (previous year Rs 0.15 crore) and Commissioner of Service Tax Ahmedabad Rs 0.03 crore (previous year Rs 0.03 crore).

The Company has taken an external opinion in the matter based on which the management is of the view that no liability shall arise on the Company.

Commissioner of Customs, Ahmedabad has demanded 2.00 2.00 vide letter no.4/Comm./SIIB/2009 dated 25/11/2009 for recovery of penalty in connection with import of Air Craft which is owned by Karnavati Aviation Private Limited (Formerly Gujarat Adani Aviation Private Limited.), subsidiary of the Company.

Company has filed an appeal before the Customs, Excise and Service Tax Appellate Tribunal against the demand order, the management is reasonably confident that no liability will devolve on the Company and hence no liability has been recognized in the books of account.

Show cause notice received from Commissioner of 11.15 - Customs, Mundra in respect of recovery of cost recovery charges of customs establishment at Mundra Port Rs 11.15 crore (previous year Nil) from the Company for the financial year 2013-14 and 2014-15.

The Company has given deposit of Rs 4.99 crore (previous year Nil) against the demand. The Company had filed proposal for waiver of cost recovery charges claiming fulfilment of conditions prescribed under the board Circular No.16/2013-Cus dated 10.04.2013. The management is reasonably confident that proposal for waiver of cost recovery charges has been accepted by the department. Hence no liability has been recognised in the books of accounts.

Company has imported Tamping Machine & Spare parts 2.95 2.95 system

Plasser Theurer duty free under the EPCG Scheme for which an export obligation of Rs 17.73 crore that is equivalent to 6 times of duty saved. The export obligation has to be completed by F.Y. 2019-20.

The Company has disputed tax demand for assessment refer note (o) 52.01 years 2008-09, 2009-10, 2010-11 and 2011-12. below The management is reasonably confident that no liability will be devolve on the Company.

Bills discounted with banks 449.67 -

(o) The Company earns interest income on funds lend to various parties. The Company contends that such interest income are earned from existing and potential business associates and whereby concluded that such interest income has arisen from the Company''s business activities and can be netted off with the total interest expenditure which are incurred for business purposes while computing the deduction as per the provisions of section 80IAB of the Income Tax Act, 1961. The Company has been assessed on similar basis by the income tax authorities in respect of assessment years up to 2011-12 based on order of CIT (Appeals). The income tax authorities have filed appeal with Income Tax Appellate Tribunal in the matter as regards netting off interest income with interest expenditure.

Considering the representation of facts in the matter made by the Company, CIT (Appeals) order upholding the claims of the Company for the earlier years, and based on the expert''s advice, the management does not expect the tax liabilities to crystallise on certain interest income earned during financials year 2012-13, 2013-14 and 2014-15 and hence no provision is made in the books of account against such interest income. Based on this the Company has accounted higher Minimum Alternate Tax (''MAT'') credit of Rs. 136.96 crores during the year (including Rs 59 crores in respect of earlier years).

(p) The Company had initiated and recorded the divestment of its entire equity holding in Adani Abbot Point Terminal Holdings Pty Ltd ("AAPTHPL") and entire Redeemable Preference Shares holding in Mundra Port Pty Ltd ("MPPL") representing Australia Abbot Point Port operations to Abbot Point Port Holdings Pte Ltd, Singapore during the year ended March 31, 2013. The sale of securities transaction was recorded as per Share Purchase Agreement (''SPA'') entered on March 30, 2013 with a condition to have regulatory and lenders approvals. The Company has all the approvals except in respect of approval from one of the lenders who has given specific line of credit to MPPL. The Company received entire sale consideration except AUD 17.17 Million as on reporting date. The Company also has outstanding corporate guarantee to lender of USD 800 million against line of credit to MPPL, which is still outstanding and has also pledged its entire equity holding of 1,000 equity shares of AUD 1 each in MPPL at the reporting date in favour of lender. Outstanding loan against said corporate guarantee as on March 31,2015 is USD 487.00 million.

During previous year, the Company has received corporate guarantee (''Deed of Indemnity'') against above outstanding corporate guarantee from Abbot Point Port Holding Pte Ltd, Singapore.

30. The following are the details of loans and advances in the nature of loans given to subsidiaries, associates and other entities in which directors are interested in terms of clause 32 of listing agreement.

Note :

All loans are given on interest free basis except loan to Adani Agri Fresh Limited, Adani Power Limited, Adani Logistics Limited (part of the loan), Adani Enterprises Limited, The Dhamra Port Company Limited, Adani Kandla Bulk Terminal Private Limited, Adani Petronet (Dahej) Port Private Limited and Chemoil Adani Private Limited.

31. The Company has entered into preliminary agreement with one of the party for development and maintenance of Liquefied Natural Gas (LNG) infrastructure facilities at Mundra (Mundra LNG Project) vide agreement dated September 30, 2014. The Company and the party are in the process of concluding a definitive agreement for Mundra LNG Project relating to development and lease of infrastructure facilities (including lease of land). Pending conclusion of definitive agreement, the Company has recognised project service revenue of Rs 200 crore towards land reclamation based on the activities completed and land being made available to the party for setting up the project facilities. The cost of service is expensed in statement of Profit and loss. The possible adjustments, if any, will be accounted later on execution of definitive agreement although the management does not expect any further adjustment.

32. The Company had received a show cause notice from Ministry of Environment and Forest ("MoEF") during the previous year wherein, the Company was asked to meet certain condition and compliance thereof. The Company had filed its reply to the aforesaid show cause notice and is confident of having no liability in the matter. Subsequently, the Company has received environment & CRZ clearance for multi - product SEZ at Mundra from MoEF vide their order dated July 15, 2014. Also, the management is confident of recovery of certain receivables from customers which remained overdue as at year end on account of pending environment clearance.

33. The board of directors of Adani Ports and Special Economic Zone Ltd. ("APSEZ") in their meeting held on January 30, 2015, approved the composite scheme of arrangement for demerger of the diversified businesses of its parent company, Adani Enterprises Limited ("AEL"), involving demerger of the Port undertaking of AEL comprising the undertaking, businesses, activities, operations, assets (moveable and immoveable) and liabilities pertaining to the Belekeri port and the shareholding of AEL in APSEZ. As per the scheme, the shareholding of AEL in APSEZ shall be cancelled once being made effective and APSEZ shall issue new equity Shares to the equity shareholders of AEL in the ratio of 14,123 Equity Shares in APSEZ for every 10,000 equity shares held by such equity shareholder of AEL in AEL as of the "Record Date" to be determined for the purpose of the scheme. The appointed date of the scheme, being the date on which the Port undertaking shall vest in the APSEZ, has been fixed as April 01,2015.

During the year, the Company had received the approval of Bombay Stock Exchange (India) Limited and the National Stock Exchange of India Limited for the composite scheme. The shareholders of the Company have approved the above Composite Scheme of Arrangement by Postal Ballot and Court Convened Meeting on April 19, 2015 and April 20, 2015 respectively. The said scheme is subject to the approval of Hon''ble High court of Gujarat and such other regulatory and statutory approvals as may be required.

34. In terms of approval of Board of Trustees of Kandla Port Trust dated July 19, 2014 regarding change of shareholding pattern ("Ownership structure") of Adani Kandla Bulk Terminal Private Limited ("AKBTPL") (a subsidiary of the Company ) from 51:49 to 74:26 between the Company and Adani Enterprise Limited, an addendum to the Concession Agreement has been executed with Kandla Port Trust on August 22, 2014 giving effect of the changed shareholding. The related equity contribution due to change in shareholding was effected on December 26, 2014.

Further, the Company has entered into agreement on December 20, 2014 with AKBTPL whereby interest free loan of Rs 879.12 crore paid by the Company to AKBTPL over the period since June 28, 2013 has been converted into interest bearing loan as the Company has received approval from Kandla Port Trust to have 74% equity share holding in AKBTPL. Company has accounted interest income of Rs 96.84 crore in the books of account including interest of Rs 13.66 crore relating to period prior to March 31, 2014.

35. Interest in a joint venture

The company holds 50% interest in Adani International Container Terminal Private Limited and Adani CMA Mundra Terminal Private Limited, respectively, jointly controlled entities.


Mar 31, 2014

1. Corporate information

Adani Ports and Special Economic Zone Limited (''the Company'', ''APSEZL'') is in the business of development, operations and maintenance of port infrastructure has linked multi product Special Economic Zone (SEZ) and related infrastructure contiguous to Mundra port. The initial port infrastructure facilities at Mundra including expansion thereof through development of additional terminals and south port infrastructure facilities are developed pursuant to the concession agreement with Government of Gujarat (GoG) and Gujarat Maritime Board (GMB) for 30 years period effective from February 17, 2001. The Company has expanded port infrastructure facilities through approved supplementary concession agreement (pending to be concluded) which will be effective till the year 2040, whereby port infrastructure has been developed at Wandh, Mundra to handle coal cargo. The said agreement is in the process of getting signed with GoG and GMB as at the year end although the part of the Coal terminal at Wandh is recognised as commercially operational w.e.f. February 1, 2011. The Container terminal facilities (CT-1) initially developed by the Company was transferred under sub- concession agreement between Mundra International Container Terminal Limited (MICTL) (erstwhile Adani Container (Mundra)Terminals Limited) and APSEZL entered into, on January 7, 2003 wherein APSEZL has given rights to MICTL to handle the container cargo for a period of 28 years i.e. up to February 17, 2031. Similarly container facilities developed as South Port (CT-3) has been leased under approved sub concession agreement dated October 17, 2011 to (50:50) joint venture Company Adani International Container Terminal Private Limited (AICTPL) as per co-termination with main concession agreement with GMB.The sub-concession agreement is pending to be concluded with GMB. The Multi Product Special Economic Zone at Mundra and surrounding areas is developed by the Company as per approval of Government of India vide their letter no. F-2/11/2003/EPZ dated April 12, 2006 as amended from time to time till date. The Company has also taken approval of Ministry of Commerce and Industry to set up Free Trade and Warehousing Zone vide letter no. F.1/16/2011-SEZ dated March 26, 2012. During the year, the Company has applied to Ministry of Commerce and Industry for further notification of 1856 hectares of land as a Multi Product Special Economic Zone.

2. Basis of Preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended), the provisions of the Companies Act, 2013 (to the extent notified) read with general Circular 08/2014 dated April 04, 2014 issued by Ministry of Corporate Affairs and the relevant provisions of the Companies Act, 1956 (to the extent applicable). The financial statements have been prepared on an accrual basis under the historical cost convention. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year .

3. Segment Information

The Company is primarily engaged in one business segment, namely developing, operating and maintaining the Port and Port based related infrastructure services including Multi product Special Economic Zone in accordance with Accounting Standard (AS) 17 on Segment Reporting notified under the Companies (Accounting Standard) Rule 2006 (as amended). There being no business outside India, the entire business has been considered as single geographic segment.

4. Related Party Disclosures

The Management has identified the following entities and individuals as related parties of the Company for the year ended March 31, 2014 for the purposes of reporting as per Accounting Standard (AS) 18 – Related Party Transactions, which are as under:

A. Related parties where control exists.

Holding Company Adani Enterprises Ltd.

Subsidiary Companies

Mundra SEZ Textile and Apparel Park Pvt. Ltd.

MPSEZ Utilities Pvt. Ltd.

Rajasthan SEZ Pvt. Ltd. (upto February 9, 2013)

Adani Logistics Ltd.

Karnavati Aviation Pvt. Ltd.

Adani Murmugao Port Terminal Pvt. Ltd.

Mundra International Airport Pvt. Ltd.

Adani Hazira Port Pvt. Ltd.

Adani Petronet (Dahej) Port Pvt. Ltd.

Adani Vizag Coal Terminal Pvt. Ltd.

Adani Kandla Bulk Terminal Pvt. Ltd.

Adani Warehousing Service Pvt. Ltd.

Adani Ennore Container Terminal Pvt. Ltd.* (18/02/2014)

Adani Hospitals Mundra Pvt. Ltd.* (01/11/2013)

Entity held through Controlling Interest

Adinath Polyfills Pvt. Ltd.

Step down Subsidiary

Hazira Infrastructure Pvt. Ltd. Hazira Road Infrastructure Pvt. Ltd.

B. Related parties with whom transaction have been taken place during the year.

Joint Venture Adani International Container Terminal Pvt. Ltd.

Associate Dholera Infrastructure Pvt. Ltd.

Fellow Subsidiary

Adani Power Ltd.

Adani Power Dahej Ltd.

Adani Mining Pvt. Ltd.

Adani Gas Ltd.

Chemoil Adani Pvt. Ltd.

Adani Global FZE, Dubai.

Adani Infra (India) Ltd.

Adani Power Rajasthan Ltd.

Adani Welspun Exploration Ltd.

Kutchh Power Generation Ltd.

Adani Agri Fresh Ltd.

Adani Power Maharashtra Ltd.

Adani Mundra SEZ Infrastructure Pvt. Ltd.

Adani Properties Pvt. Ltd.

Key Management Personnel

Mr. Gautam S. Adani, Chairman and Managing Director Mr. Rajeeva Ranjan Sinha, Whole time Director Dr. Malay R. Mahadevia, Whole time Director

Relative of Key Management Personnel

Mr. Rajesh S. Adani, Director

Entities over which Key Management Personnel, Directors and their relatives are able to exercise Significant Influence

Gujarat Adani Institute of Medical Science

Adani Wilmar Ltd.

Shanti Builders

Adani Foundation

Dholera Port and Special Economic Zone Ltd.

Mundra Port Pty Ltd., Australia

Adani Abbot Point Terminal Pty Ltd, Australia

Abbott Point Port Holdings Pte Ltd, Singapore

* These entities have been incorporated/formed during the year.

Aggregate of transactions for the year ended with these parties have been given below.

Sub Notes:

1 The names of the related parties and nature of the relationships where control exists are disclosed irrespective of whether or not there have been transactions between the related parties. For others, the names and the nature of relationships is disclosed only when the transactions are entered into by the Company with the related parties during the existence of the related party relationship.

2 Pass through transaction payable relating to railway freight, water front charges and other payable to third parties have not been considered for the purpose of related party disclosure.

3 For the purpose of comparison, the previous year''s transactions have been re-classified in the current year

5. The Company has been availing benefit u/s 80IAB of the Income Tax Act, 1961 on the taxable income. In view of the amendment in Income Tax Act, 1961 w.e.f. April 1, 2011 by Finance Act 2011, the Company is liable to pay Minimum Alternate Tax (MAT) on income from the financial year 2011-12. Based on the amendment, the Company has made provision of Rs. 463.63 crore (previous year Rs. 377.36 crore) for current taxation based on its book profit for the financial year 2013-14 and considered credit for MAT of Rs. 387.37 crore (previous year Rs. 365.58 crore) as the management believes, it has convincing evidence in the nature of strategic volumes of cargo available with the Company and higher depreciation charge for accounting purposes than the depreciation for income tax purposes in the future period, thereby, the MAT credit will be utilized post tax holiday period.

6. During the year Company transferred Container Terminal Infrastructure Assets (earlier included as "Fixed assets held for sale") to Adani International Container Terminal Private Limited (AICTPL ), a (50:50) joint venture entity between Company and Mundi Limited on approval of government and regulatory authorities under the approved sub-concession agreement by Gujarat Maritime Board (GMB) w.e.f. July 1, 2013. The income from sale /sub-lease of core port assets i.e. port container infrastructure, upfront infrastructure development fee and proportionate portion of deferred usages charges aggregating to Rs. 890.92 crore are included in revenue from operations and corresponding related costs are shown under head "Operating Expenses". The value of port equipments and other miscellaneous assets related to port terminal sold to AICTPL is netted against the cost in the financial statement as such assets were being acquiared specifically for AICTPL and transferred on cost basis . The value of such asset is Rs. 597.67 crore . The details of assets included as "Fixed assets held for sales" is as follows.

7. Capital Commitments and Other Commitments Capital Commitments

Other Commitments

a) The port projects of subsidiary companies viz. Adani Hazira Port Private Limited, Adani Petronet (Dahej) Port Private Limited, Adani Murmugao Port Terminal Private Limited and Adani Vizag Coal Terminal Private Limited has been funded through various credit facility agreements with banks. Against the said facilities availed by the subsidiary companies from the banks, the Company has executed a Sponsor Undertaking and Pledge Agreement whereby 51% of the holding would be retained by the Company at all points of time and of which 30% holding is pledged (except in case of AICTPL where the company has pledged 1,64,59,755 equity shares (equivalent to 5.31 %) and balance share are in process of being pledged) and for the balance 21% holding, the Company has given a non-disposal undertaking to the lenders of respective subsidiary companies.

b) In terms of arrangement with Adani Enterprises Limited, the holding company, the Company has proposed to purchase equity share and consequential economic interest /ownership rights there under in respect of some of the companies where equity shares are also held by holding company. The Company is in the process of obtaining regulatory approvals to get the share transferred in it''s own name . In the meantime, the Company has advances unsecured loans to these companies as promoter''s contribution for funding the ongoing projects.

c) An agreement has been entered between Adani Petronet (Dahej) Port Private Limited (APDPPL - subsidiary company), Adani Power Limited (fellow subsidiary), Adani Enterprises Limited (holding company), Adani Power Dahej Limited (fellow subsidiary) and the Company, wherein Adani Power Dahej Limited has agreed to transfer under suitable arrangements, certain assets to APDPPL. Based on the agreement, the Company has given Rs. 248.00 crore as an capital advance to Adani Power Limited. The transaction is recorded as capital advance in the books of accounts. As per agreement, the transaction is expected to consummate by March 31, 2015.

d) The Company has entered into an agreement / MOU with a party to purchase or lease corporate office space of 5 lacs square feets. The Company has given deposit of Rs. 250.00 crore as per the agreement / MOU to secure its rights.

8. Contingent Liabilities not provided for (Rs. In Crore)

Sr. Particulars As at As at No. March 31, 2014 March 31, 2013

a. Corporate Guarantees given to banks and financial institutions 787.77 578.04 against credit facilities availed by the subsidiaries - Amount outstanding there against Rs. 727.09 crore (previous year Rs. 195.19 crore)

b. Corporate Guarantee given to Bank for credit facility availed by (Refer note 40) 4,342.80 erstwhile subsidiary company, Mundra Port Pty Limited, Australia. (Amount outstanding there against Rs. 4,793.20 crore (previous year Rs. 4,342.80 crore)

c. Bank Guarantees and Letter of Credit outstanding against credit 538.99 645.35 facilities availed by the subsidiaries

d. Bank Guarantees given to government authorities and bank (also 121.68 77.02 includes DSRA bank guarantees given to Bank on behalf of subsidiaries and erstwhile subsidiaries.

e. Civil suits filed by the Customers for recovery of damages caused 30.49 30.49 to machinery in earthquake Rs. 0.37 crore (previous year Rs. 0.37 crore), to cargo stored in Company''s godown Rs. 0.94 crore (previous year Rs. 0.94 crore), loss due to mis-handling of wheat cargo Rs. 6.20 crore (previous year Rs. 6.20 crore) and loss due to non-performance of dredging contract Rs. 22.98 crore (previous year Rs. 22.98). The said civil suits are currently pending with various Civil Courts in Gujarat. The management is reasonably confident that no liability will devolve on the Company in this regard and hence no provision is made in the books of accounts towards these suits.

f. The Company received show cause notices from the Custom 0.46 0.46 Authorities for import of various Cargos at Port Rs. 0.46 crore (previous year Rs. 0.46 crore). The Customs cases are currently pending with, Assistant Commissioner of Customs, Mundra (Rs. 0.14 crore), Customs, Excise and Service Tax Appellate Tribunal, Mumbai (Rs. 0.27 crore) and Addl. Director General, DRI (Rs. 0.05 crore) respectively. The Company has given deposit of Rs. 0.05 crore (previous year Rs. 0.05 crore) against the demand. The management is reasonably confident that no liability will devolve on the Company and hence no liability has been recognised in the books of accounts.

g. Deputy Commissioner of Customs, Mundra and Assistant 0.25 0.25 Commissioner of Customs, Mumbai have held that the Company wrongly availed duty benefit exemption under DFCEC Scheme on import of equipment and demanded duty payment of Rs. 0.25 crore (previous year Rs. 0.25 crore). The Company has filed its reply to the show cause notice with Deputy Commissioner of Customs, Mundra and Commissioner of Customs, Mumbai against order in original. The management is of view that no liability shall arise on the Company.

h. Various show cause notices received from Commissioner/ 73.20 69.19 Additional Commissioner/ Joint Commissioner / Deputy Commissioner of Customs and Central Excise, Rajkot and Commissioner of Service Tax, Ahmedabad, for wrongly availing of Cenvat credit/ Service tax credit and Education Cess credit on input services and steel, cement and other misc. fixed assets during financial year 2006-07 to 2013-14. The Excise department has demanded recovery of the duty along with penalty and interest thereon. The Company has given deposit of Rs. 4.50 crore (previous year: Rs. 4.50 crore) against the demand. The matters are pending before High Court of Gujarat, Commissioner of Central Excise (Appeals), Rajkot and Commissioner of Service Tax, Ahmedabad. The Company has taken an external opinion in the matter based on which the management is of the view that no liability shall arise on the Company.

I. Show cause notices received from Commissioner of Customs and 6.90 6.90 Central Excise, Rajkot in respect of levy of service tax on various services provided by the Company and wrong availment of CENVAT credit by the Company during financial year 2009-10 to 2011-12. The matter is currently pending at High Court of Gujarat Rs. 6.72 crore (previous year Rs. 6.72 crore); and Customs, Excise and Service Tax Appellate Tribunal, Ahmedabad Rs. 0.15 crore (previous year Rs. 0.15 crore) and Commissioner of Service Tax Ahmedabad Rs. 0.02 crore (previous year Rs. 0.02 crore). The Company has taken an external opinion in the matter based on which the management is of the view that no liability shall arise on the Company.

j. Commissioner of Customs, Ahmedabad has demanded vide letter 2.00 2.00 no.4/Comm./SIIB/2009 dated 25/11/2009 for recovery of penalty in connection with import of Air Craft which is owned by Karnavati Aviation Private Limited (Formerly Gujarat Adani Aviation Private Limited.), subsidiary of the Company. Company has filed an appeal before the Customs, Excise and Service Tax Appellate Tribunal against the demand order, the management is reasonably confident that no liability will devolve on the Company and hence no liability has been recognized in the books of account.

k. Company has imported Tamping Machine & Spare parts system 2.95 - Plasser Theurer duty free under the EPCG Scheme for which an export obligation of Rs. 17.73 crore that is equivalent to 6 times of duty saved of Rs. 2.95 crore. The export obligation has to be completed by F.Y. 2019-20.

l. During the year the Company has received order from Addl. 52.01 - Commissioner of Income Tax and Dy. Commissioner of Income tax for recovery of income tax of Rs. 33.27 crore and interest of Rs. 18.74 crore for assessment years 2009-10, 2010-11 and 2011-12.The management is reasonably confident that no liability will be devolve on the Company.

9. During the previous year, the Company had initiated and recorded the divestment of its entire equity holding in Adani Abbot Point Terminal Holdings Pty Limited (AAPTHPL) and entire Redeemable Preference Shares holding in Mundra Port Pty Ltd (MPPL) representing Australia Abbot Point operations to Abbot Point Port Holdings Pte Ltd, Singapore. The Company entered Share Purchase Agreement (''SPA'') on March 30, 2013 to sell its holding in AAPTHPL and MPPL. In terms of the SPA the conditionality as regards regulatory and lenders approvals were obtained except in respect of approval from one of the lenders who have given specific line of credit to MPPL. The Company has also extended a corporate guarantee of USD 800 million against this line of credit to MPPL, which is outstanding as at the year end and the Company has pledged its entire equity holding of 1,000 equity shares of AUD 1 each at the reporting date in favour of lender.

During the year the Company has received corporate guarantee (''Deed of Indemnity'') against this outstanding corporate guarantee from Abbot Point Port Holding Pte Limited, Singapore.

10. During the year, the Company had received a show cause notice from Ministry of Environment and Forest. The Company has filed its reply to the aforesaid show cause notice and is confident of having no liability in the matter. Also, the management is confident of recovery of certain receivables from customers which remained overdue as at year end on account of the pending environment clearances.

11. Interest in a joint venture

The company holds 50% interest in Adani International Container Terminal Private Limited, a joint controlled entity which is developing container terminal and associated facility.

The company''s share of the assets, liabilities, income and expenses of the jointly controlled entity for the year ended March 31, 2014

12. previous year figures

previous year''s figures have been regrouped wherever necessary to conform to this year''s classification.


Mar 31, 2013

1. Corporate information

Adani Ports and Special Economic Zone Limited (''the Company'', ''APSEZL'') (formerly known as Mundra Port and Special Economic Zone Ltd.) is in the business of development, operations and maintenance of port infrastructure and linked multi product SEZ and related infrastructure contiguous to Mundra port. The initial port infrastructure facilities at Mundra including expansion thereof through development of additional terminals and south port infrastructure facilities are developed pursuant to the concession agreement with the Government of Gujarat (GoG) and Gujarat Maritime Board (GMB) for 30 years effective from February 17, 2001. The Company has expanded port infrastructure facilities through proposed supplementary concession agreement, which will be effective till 2040, for coal terminal at Wandh, Mundra with the right and authority to develop, design, finance, construct, operate and maintain the port and related infrastructure. The said agreement is in the process of getting signed with GoG and GMB as at the year end although the part of the Coal terminal at Wandh is recognised as commercially operational w.e.f. February 1, 2011.

The Container terminal facilities (CT-1) initially developed by the Company was transferred under sub- concession agreement between Mundra International Container Terminal Limited (MICTL) (erstwhile Adani Container Terminal Limited) and APSEZL entered into, on January 7, 2003 wherein APSEZL has given rights to MICTL to handle the container cargo for a period of 28 years i.e. up to February 17, 2031. For the new container facilities developed as South Port (CT-3) has been agreed to be transferred to Adani International Container Terminal Private Limited (AICTPL).

The Multi Product Special Economic Zone at Mundra and surrounding areas is developed by the Company as per approval of the Government of India vide their letter no. F-2/11/2003/EPZ dated April 12, 2006 as amended from time to time till date. The Company has also taken approval of Ministry of Commerce and Industry to set up Free Trade and Warehousing Zone vide letter no. F.1/16/2011-SEZ dated March 26, 2012.

2. Basis of Preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis under the historical cost convention. The accounting policies have been consistently applied by the Company.

3. Details of employee benefits

1. The company has recognised, in the statement of profit and loss for the current year, an amount of Rs. 3.81 crores (Previous Year Rs. 3.56 crores) as expenses under the following defined contribution plan.

2. The Company has a defined gratuity plan. Every employee gets a gratuity on departure at 15 days salary (last drawn basic salary) for each completed year of service. The scheme is funded with Life Insurance Corporation of India (LIC) in the form of a qualifying insurance policy.

The following tables summarise the components of net benefit expense recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for the respective plans.

4. Segment Information

The Company is primarily engaged in the business of developing, operating and maintaining the Port and Port based related infrastructure facilities including Multi product Special Economic Zone. The entire business has been considered as a single segment in terms of Accounting Standard (AS) 17 on Segment Reporting notified under the Companies (Accounting Standard) Rule 2006 (as amended). There being no business outside India, the entire business has been considered as single geographic segment.

5. Related Party Disclosures

The Management has identified the following entities and individuals as related parties of the Company for the year ended March 31, 2013 for the purposes of reporting as per Accounting Standard (AS) 18 - Related Party Disclosures notified under the Companies (Accounting Standard) Rule 2006 (as amended), which are as under:

Holding Company Adani Enterprises Ltd.

Subsidiary Companies Mundra SEZ Textile and Apparel Park Pvt. Ltd.

MPSEZ Utilities Pvt. Ltd.

Rajasthan SEZ Pvt. Ltd. (upto February 9, 2013)

Adani Logistics Ltd.

Karnavati Aviation Pvt. Ltd.

Adani Murmugao Port Terminal Pvt. Ltd.

Mundra International Airport Pvt. Ltd.

Adani Hazira Port Pvt. Ltd.

Adani Petronet (Dahej) Port Pvt. Ltd.

Adani Vizag Coal Terminal Pvt. Ltd.

Adani Kandla Bulk Terminal Pvt. Ltd.

Mundra Port Pty Ltd. (upto March 30, 2013)

Adani Abbot Point Terminal Holdings Pty Ltd. (upto March 30, 2013)

Adani Warehousing Service Pvt. Ltd. [w.e.f. April 19, 2012]*

Entity held through Controlling Interest

Adinath Polyfills Pvt. Ltd.

Joint Venture Adani International Container Terminal Pvt. Ltd.

Associate Dholera Infrastructure Pvt. Ltd.

Step down Subsidiary Hazira Infrastructure Pvt. Ltd.

Hazira Road Infrastructure Pvt. Ltd.

Mundra Port Holdings Trust (trust entity) (upto March 30, 2013) Mundra Port Holdings Pty Ltd. (upto March 30, 2013)

Adani Abbot Point Terminal Pty Ltd. (upto March 30, 2013)

Fellow Subsidiary Adani Power Ltd.

Adani Agri Logistics Ltd.

Adani Power Dahej Ltd.

Adani Gas Ltd.

Chemoil Adani Pvt. Ltd.

Adani Global FZE, Dubai.

Adani Global Pte Ltd.

Adani Infra (India) Ltd.

Adani Power Rajasthan Ltd.

Adani Welspun Exploration Ltd.

Kutchh Power Generation Ltd.

Adani Agri Fresh Ltd.

Adani Energy Ltd.

Mundra LNG Ltd.

Adani Power Maharashtra Ltd.

Adani Mundra SEZ Infrastructure Pvt. Ltd. (upto June 29, 2012)

Adani Agro Pvt. Ltd. (upto June 29, 2012)

Adani Properties Pvt. Ltd. (upto June 29, 2012)

Key Management Personnel Mr. Gautam S. Adani, Chairman and Managing Director

Mr. Rajeeva Ranjan Sinha, Whole time Director

Dr. Malay R. Mahadevia, Whole time Director

6. Information required to be furnished as per Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) for the year ended March 31, 2013. This information has been determined to the extent such parties have been identified on the basis of information available with the Company.

7. The Company has been availing benefit u/s 80IAB of the Income Tax Act, 1961 on the taxable income. In view of the amendment in Income Tax Act, 1961 w.e.f. April 1, 2011 by Finance Act 2011, the Company is liable to pay Minimum Alternate Tax (MAT) on income from the financial year 2011-12. Based on the amendment, the Company has made provision of Rs. 377.36 crores (Previous year Rs. 254.33 crores) for current taxation based on its book profit for the financial year 2012-13 and considered credit for MAT of Rs. 365.58 crores (Previous year Rs. 242.17 crores) as the management believes, it has convincing evidence in the nature of strategic volumes of cargo available with the Company and higher depreciation charge for accounting purposes than the depreciation for income tax purposes in the future period, thereby, the MAT credit will be utilized post tax holiday period.

8. Fixed assets held for sale represent new container terminal at Mundra (CT-3), pending transfer to Adani International Container Terminal Private Limited (AICTPL), a Joint Venture entity between the Company and Global Terminal Limited. The container terminal will get transferred to AICTPL on receiving the necessary regulatory approvals from the government authorities. Further till the time the asset are transfer to AICTPL, the company continues to operate the asset.

9. Capital Commitments and Other Commitments

Capital Commitments (Rs. In Crores)

Particulars As at As at March 31, 2013 March 31, 2012

Estimated amount of contracts (Net of advances) remaining to be 233.05 661.02 executed on capital account and not provided for

Other Commitments

a) The port projects of subsidiary companies viz. Adani Hazira Port Private Limited, Adani Petronet (Dahej) Port Private Limited and Adani Murmugao Port Terminal Private Limited has been funded through various credit facility agreements with banks. Against the said facilities availed by the subsidiary companies from the banks, the Company has executed a Sponsor Undertaking and Pledge Agreement whereby 51% of the holding would be retained by the Company at all points of time of which 30% holding is pledged and for the balance 21% holding, the Company has given a non-disposal undertaking to the lenders of respective subsidiary companies.

b) As per terms of sanction of US$ 800 millions facility by State Bank of India (SBI) to Mundra Port Pty Limited (MPPL), an entity in which company remain invested through 1000 Equity Share of AUD 1 each at the reporting date. The Company has pledged its Equity holding in MPPL in favour of SBI. (Also Refer Note 40)

c) The Company has entered into an "Equity Subscription Agreement" to contribute equity in Mundra Port Pty Limited (MPPL), in which company has transferred substantial voting right to promoter entity during the year, for meeting capital expenditure requirements of Abbot Point Terminal assets, as and when required. In order to ensure timely subscription to equity, the bankers to the MPPL had required a stand by letter of credit facility. Accordingly, APSEZL procured stand by letter of credit from Standard Chartered Bank and State Bank of India, which in-turn is backed by a corporate guarantee issued by the Company in favor of Standard Chartered Bank and State Bank of India amounting to AUD 22.03 millions and USD 800.00 millions respectively. As at March 31, 2013, MPPL has availed loan of USD 800.00 millions from State Bank of India but no financing facility has been availed from Standard Chartered Bank.

10. During the year, the Company had initiated and recorded the divestment of its entire equity holding in Adani Abbot Point Terminal Holdings Pty Limited (AAPTHPL) and entire Redeemable Preference Shares holding in Mundra Port Pty Ltd (MPPL) representing Australia Abbot Point operations to promoter Company, Abbot Point Port Holdings Pte Ltd, Singapore for consideration of AUD 235.71 millions. The Company entered Share Purchase Agreement (''SPA'') on March 30, 2013 to sell its holdings in AAPTHPL and MPPL. In terms of the SPA the conditionality as regards regulatory and lenders approvals was obtained except in respect of approval from one of the lenders who have given specific line of credit to MPPL, which the Company is following up with the lender and is confident of obtaining the same.

The Company, based on the legal counsel opinion, concluded that on the date of signing of SPA, AAPTHPL and MPPL cease to be subsidiaries of the Company w.e.f. March 31, 2013. The Company has accounted income of Rs. 70.01 crores against the sale of said investment which is included under the head "Other Income".

11. During the year, the Company has applied to Ministry of Commerce, SEZ Division for re-notification of 1840 hectare of land which was earlier denotified by the authorities, for the technical reasons.

12. Interest in a joint venture

The company holds 50% interest in Adani International Container Terminal Private Limited, a joint controlled entity which is developing container terminal and associated facility.

The company''s share of the assets, liabilities, income and expenses of the jointly controlled entity for the year ended March 31, 2013

13. Previous year figures

Previous year''s figures have been regrouped wherever necessary to conform to this year''s classification.


Mar 31, 2012

1 Corporate information

Adani Ports and Special Economic Zone Limited ('the Company', 'APSEZL!) (formerly known as Mundra Port and Special Economic Zone Limited) is in the business of development, operations and maintenance of multi product SEZ and related infrastructure. The initial port infrastructure facilities including expansion thereof through development of additional berths and south port infrastructure facilities are developed pursuant to the concession agreement with Government of Gujarat (GoG) and Gujarat Maritime Board (GMB) for 30 years effective from February 17, 2001. The Company is doing expansion of port infrastructure facilities through proposed supplementary concession agreement, which will be effective till 2040, for coal terminal at Wandh, Mundra with the right and authority to develop, design, finance, construct, operate and maintain the port and related infrastructure. The said agreement is in the process of getting signed with GoG and GMB as at the year end although the part of the coal terminal at Wandh is recognized as commercially operational w.e.f. February 1, 2011.

Part of the port facilities initially developed by the Company was transferred under sub-concession agreement between Mundra International Container Terminal Limited (MICTL) (erstwhile Adani Container Terminal Limited) and APSEZL entered into, on January 7, 2003 wherein APSEZL has given rights to MICTL to handle the container cargo for a period of 28 years i.e. up to February 17, 2031.

The Company is developer of Multi Product Special Economic Zone at Mundra and surrounding areas as per approval of Government of India vide their letter no. F-2/11/2003/EPZ dated April 12, 2006 as amended from time to time till date.

2 Basis of Preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company.

a. Terms/rights attached to equity shares

The company has only one class of equity shares having a par value of Rs 2 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The final dividend recommended by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

For the current financial year 2011-12, the Company declared and paid an Interim dividend of Rs 0.30 per share and proposed a final dividend of Rs 0.70 per share. (For the previous financial year two interim dividends of Rs 0.40 per share and Rs 0.50 per share were declared and paid in 2010-11 and 2011-12 respectively).

b. Terms of Non-cumulative redeemable preference shares

The Company has 28,11,037 outstanding 0.01% Non-Cumulative Redeemable Preference Shares ('NCRPS') of Rs 10 each issued at a premium of Rs 990 per share. Each holder of preference shares has a right to vote only on resolutions placed before the company which directly affects the right attached to his preference shares. These shares are redeemable on March 28, 2024 at an aggregate premium of Rs 27,829.27 lacs. The Company credits the redemption premium on proportionate basis every year to Preference Share Capital Redemption Premium Reserve and debits the same to Securities Premium Account as permitted by Section 78 of the Companies Act, 1956.

In the event of liquidation of the company the holder of NCRPS will have priority over equity shares in the payment of dividend and repayment of capital.

1. Debentures include Secured Non-Convertible Redeemable Debentures amounting to Rs42,500.00 lacs (Previous Year Rs85,000.00 lacs) are secured by first Pari-passu charge on all the immovable and movable assets of Container Terminal - II, Terminal -II and Multipurpose Terminal (MPT).

2. Debentures include Secured Non-Convertible Redeemable Debentures aggregating to Rs4,630.12 lacs (Previous Year Rs13,310.33 lacs) are secured by exclusive mortgage and charge on entire Single Point Mooring (SPM) facilities and the first charge over receivables from Indian Oil Corporation Limited.

3. Foreign currency term loan from banks aggregating to Rs 192.99 lacs (Previous Year Rs 9,143.55 lacs) carries interest @ 6M Libor plus 62.5 bps which are repayable on maturity in 2012-13. The same are secured by exclusive charge on the Cranes.

Further, of the above loan, Rs Nil (Previous year Rs 8,638.23 lacs) were further secured by pari-passu second charge on the entire fixed assets of the company over which the first security is created in favour of existing lenders.

4. Foreign currency term loan from banks aggregating to Rs 15,142.32 lacs (Previous Year loan from banks Rs 14,538.04 lacs; Suppliers bills accepted under foreign currency letters of credit Rs 6,188.49 lacs) carries interest @ 6M Libor plus basis point in range of 165 to 315. The same are repayable in 10 semiannual instalments of approx Rs 1,514.23 lacs from the balance sheet date and are secured by exclusive charge on the Dredgers.

5. Foreign currency term loan from banks aggregating to Rs 8,922.55 lacs (Previous Year Rs 9,967.54 lacs) carries interest @ 6M Euribor plus 140 bps. Further, out of the above loan Rs 2,896.01 lacs is repayable in 9 semiannual instalments of Rs 321.78 lacs; Rs 2,945.96 lacs is repayable in 10 semiannual instalment of Rs 294.60 lacs and balance Rs 3,080.58 lacs is repayable in 10 semiannual instalments of Rs 308.06 lacs from the balance sheet date. The same are secured by exclusive charge on the Dredgers.

6. Foreign currency term loan from banks aggregating to Rs 26,873.09 lacs (Previous year Rs NIL) carries interest @ 6M Euribor plus 95 bps. The same are repayable in 20 semiannual instalments of approx. Rs 1,343.65 lacs from the date of balance sheet and are secured by exclusive charge on the Dredgers.

7. Foreign Currency term loan from banks aggregating to Rs6,330.62 lacs (Previous Year Rs6,630.53 lacs) carries interest @ 6M LIBOR plus 225 basis point. The same are secured by exclusive charge on the dredgers and is further secured by way of second pari passu charge on the entire movable and immovable fixed assets pertaining to Multi Purpose Terminal, Terminal II, Container Terminal II and SPM projects assets.

8. Foreign currency term loan from banks aggregating to Rs14,860.87 lacs (Previous Year Rs Nil) carries interest @ 6M Euribor plus 75 bps. The same are repayable in 20 semi annually instalments of Rs 743.04 lacs (Previous Year Rs Nil) from the balance sheet date and are secured by exclusive charge on the Cranes purchased under the facility.

9. Foreign Currency term loan from banks aggregating to Rs 1,68,816.45 lacs (Previous Year Rs 11,162.50 lacs) are secured by the first pari passu charge on all the immovable and movable assets pertaining to Multi Purpose Terminal, Terminal II, Container Terminal II, project assets of the company and carry interest @ 6M Libor plus basis point in range of 300 to 380. Further, out of the above loan as aggregating to Rs 51,156.50 lacs (Previous Year Rs11,162.50 lacs ) are repayable in 24 quarterly instalments of approx Rs 2,131.52 lacs from the balance sheet date; Rs 76,734.75 lacs (Previous Year Rs Nil) are repayable in 3 annual instalment of Rs 25,578.26 lacs starting repayment from 2015-16; Rs 20,462.60 lacs (Previous Year Rs Nil) are repayable in 16 semi-annual instalments ofRs 1,278.91 lacs from the date of the balance sheet. The balance amount of Rs 20,462.60 lacs (Previous Year Rs Nil) is repayable on maturity of the loan in 2016-17.

10. Foreign currency term loan from banks aggregating to Rs25,578.25 lacs (Previous Year Rs Nil ) are secured by first pari passu charge on all the movable and immovable assets pertaining to Coal Terminal project assets at Wandh and carries interest @ Libor plus basis point in range of 310 to 380. These loans are repayable in 24 quarterly instalments of approx Rs 1,065.76 lacs from the balance sheet date.

11. Foreign currency term loan from bank aggregating to Rs 1,40,680.38 lacs (Previous Year Rs Nil) carries interest @ 3M Libor plus basis point in range of 310 to 368. Of the above loan Rs 51,156.50 lacs (Previous Year Rs Nil) is repayable in 3 equal instalments of Rs 17,052.17 lacs each starting from 2015-16; balance loan of Rs 89,523.88 lacs (Previous Year Rs Nil ) is repayable in 3 equal instalments of Rs 29,841.29 lacs each starting from 2016-17. These loans are secured by first pari passu charge on all the movable and immovable assets pertaining to Coal Terminal project assets at Wandh and specific charge over land. As at March 31, 2012; security creation on land is pending to be executed by the Company.

12. Foreign currency term loan from banks aggregating to Rs 17,082.84 lacs (Previous Year Rs 10,327.62 lacs) carries interest @ 4.6% p.a. Out of these loans, Rs 7,888.60 lacs are repayable in 18 semiannual instalments of approx Rs 438.26 lacs; Rs 6,023.92 lacs are repayable in 20 semiannual instalments of approx. Rs 301.20 lacs; Rs 3,170.31 lacs are repayable in 21 semiannual instalments of Rs 150.97 lacs, from the date of balance sheet.

Suppliers bills accepted under foreign currency letters of credit from banks aggregating to Rs 7,652.93 lacs (Previous Year Rs 14,632.97 lacs) carries interest @ 6M LIBOR plus basis point in range of 100 to 325 which are repayable on maturity in 2012-13.

These loans are secured by exclusive charge on the individual Tugs.

13. Foreign currency term loan amounting to Rs Nil (Previous Year Rs 1,110.87 lacs) from financial institutions were secured by first pari passu charge on all the movable assets of the Company (save & except assets on which exclusive charged is created as stated elsewhere), both present and future and further secured by first charge on immovable assets pertaining to Container Terminal - II, Terminal - II, Multi Purpose Terminal and are further secured by a second charge on assets pertaining to the SPM Project.

14. Suppliers bills accepted under foreign currency letters of credit from banks aggregating to Rs2,535.55 lacs (Previous Year Rs 5,220.00 lacs) carries interest @ 6M Libor plus basis points in range of 25 to 315 are repayable on maturity in 2012. Further, the same are secured by first charge on goods procured under the facility and second pari passu charge on the entire movable and immovable fixed assets pertaining to Multi Purpose Terminal, Terminal II, Container Terminal II and SPM projects assets.

15. Suppliers bills accepted under foreign currency letters of credit from banks aggregating to Rs14,888.24 lacs (Previous year Rs 16,618.16 lacs) carries interest @ 6M Libor plus basis point in range of 110 to 350. Of the above, Rs 700.19 lacs are repayable on maturity in 2013-14; Rs 13,623.25 lacs are repayable on maturity in 2012-13 and balance Rs 564.80 lacs are repayable on maturity in 2014-15. The same are secured against subservient charge on movable fixed assets and current assets except those secured by exclusive charge in favor of other lenders

16. Suppliers bills accepted under foreign currency letters of credit from banks aggregating to Rs5,359.89 lacs (Previous Year Rs Nil ); carries interest @ 6M Libor plus basis point in range of 195 to 350 which is repayable on maturity in 2014-15. The same are secured against exclusive charge on the goods, materials, assets acquired or procured under the facility.

Note: Operational Claims are the expected claims against outstanding receivables made/to be made by the customers towards shortages of stock, handling loss, damages to the cargo, storage and other disputes. The probability and the timing of the outflow / adjustment with regard to above depends on the ultimate settlement / conclusion with the respective customer.

1. Suppliers bills accepted under foreign currency letters of credit from banks aggregating to Rs 987.50 lacs (Previous Year Rs Nil ) carries interest @ 6M Libor basis point in range of 150 to 300 are repayable on maturity in 2012-13. The same are secured against exclusive charge on assets purchased under the facility.

2. Suppliers bills accepted under foreign currency letters of credit from banks aggregating to Rs 14,620.49 lacs (Previous year Rs Nil ). Of the above loan Rs 10,016.42 lacs (Previous Year Rs Nil lacs) carries interest @ 6M Libor plus basis point in range of 185 to 300 which is repayable on maturity in 2012-13, balance Rs 4,604.07 lacs (Previous Year Rs Nil lacs) carries interest @ 5M Libor plus 170 basis point is repayable on maturity in 2012-13. The same are secured against exclusive charge on assets purchased under the facility.

3. Suppliers bills accepted under foreign currency letters of credit from banks aggregating to Rs492.72 lacs (Previous Year Rs 6,122.24 lacs) carries interest @ 6M Libor plus basis points in range of 25 to 315 which is repayable on maturity in 2012-13. Further, the same are secured by first charge on goods procured under the facility and second pari passu charge on the entire movable and immovable fixed assets pertaining to Multi Purpose Terminal, Terminal II, Container Terminal II and SPM projects assets.

4. Suppliers bills accepted under foreign currency letters of credit from banks aggregating to Rs 3,019.64 lacs (Previous year Rs 8,501.40 lacs) carries interest @ 6M Libor plus basis point in range of 110 to 350 which is repayable on maturity in 2012-13. The same are secured against subservient charge on movable fixed assets and current assets except those secured by exclusive charge in favor of other lender.

5. Of the suppliers bills accepted under foreign currency letters of credit from banks aggregating to Rs 935.82 lacs (Previous Year Rs Nil ); Rs 259.25 lacs (Previous Year Rs Nil ) carries interest @ 6M Libor plus basis point in range of 195 to 350 which is repayable on maturity in 2012-13, balance Rs 676.57 lacs (Previous Year Rs Nil ) carries interest @ 1 year Libor plus 135 basis point and is repayable on maturity in 2012-13. The same are secured against exclusive charge on the goods, materials, assets acquired or procured under the facility.

6. Short Term loan from banks aggregating to Rs 35,000.00 lacs (pending security creation) (previous year Rs Nil) are to be secured by first pari passu charge on Multi Purpose Terminal, Terminal II, Container Terminal II project assets.

Further, short term loan aggregating to Rs Nil (Previous year Rs 50,000 lacs) from Bank were secured by first pari passu charge on all assets pertaining to Multi Purpose Terminal, Terminal - II and Container Terminal - II Project assets of the Company and were further secured by a second charge on assets pertaining to the SPM Project.

Note:

1) Aggregate cost of unquoted investments as at March 31, 2012 Rs 1,83,755.13 lacs (Previous year - Rs 71,503.51 lacs).

2) 1,92,33,000 equity shares (Previous year - 1,92,33,000 equity shares) of Adani Petronet (Dahej) Port Private Limited and 15,000 equity shares (Previous year - 15,000) of Adani Murmugao Port Terminal Private Limited and 72,00,000 equity shares (Previous year - Nil) of Adani Hazira Port Private Limited, subsidiary companies, has been pledged with banks against borrowings by the respective companies.

Note: a) Assets taken under Operating Leases - office space and residential houses for staff accommodation are obtained on operating leases. The lease rent terms are generally for eleven months period and are renewable by mutual agreement. There are no sub-leases and leases are cancellable in nature. There are no restrictions imposed by the lease arrangements. There is no contingent rent in the lease agreements and there is no escalation clause in the lease agreements. Expenses of Rs 184.25 lacs (Previous Year Rs111.26 lacs) incurred under such leases have been expensed in the statement of profit & loss.

17. Segment Information

The Company is primarily engaged in the business of developing, operating and maintaining the Mundra Port and Port based related infrastructure facilities including Multi product Special Economic Zone. The entire business has been considered as a single segment in terms of Accounting Standard-17 on Segment Reporting issued by the Institute of Chartered Accountants of India. There being no business outside India, the entire business has been considered as single geographic segment.

18. Related Party Disclosures

The Management has identified the following entities and individuals as related parties of the Company for the year ended March 31, 2012 for the purposes of reporting as per AS 18 - Related Party Transactions, which are as under:

Sub Notes:

1 The names of the related parties and nature of the relationships where control exists are disclosed irrespective of whether or not there have been transactions between the related parties. For others, the names and the nature of relationships is disclosed only when the transactions are entered into by the Company with the related parties during the existence of the related party relationship.

2 Pass through charges relating to railway freight and other charges payable to third parties have not been considered for the purpose of related party disclosure.

3 For the purpose of comparison, the previous year's transactions have been re-classified in the current year.

19. The Government of India (GOI) has, vide its letter dated April 12, 2006, granted approval to the Company's proposal for development, operation and maintenance of a Multi-product Special Economic Zone (SEZ) at Mundra, Gujarat. Subsequently through a Notification dated June 23, 2006 and additional notifications from time to time, the Ministry of Commerce & Industry (Department of Commerce) has included Mundra Port and Port Limits in notified Special Economic Zone.

The Company has been availing benefit u/s 80IAB of the Income Tax Act, 1961 on the taxable income. In view of the amendment in Income Tax Act, 1961 w.e.f. April 1, 2011 by Finance Act 2011, the Company is liable to pay Minimum Alternate Tax (MAT) on income from the financial year 2011-12. Based on the amendment, the Company has made provision of Rs 25,433.00 lacs for current taxation based on its book profit for the financial year 2011-12 and considered credit for MAT of Rs 24,217.46 lacs as the management believes, it has convincing evidence in the nature of strategic volumes of cargo available with the Company and higher depreciation charge for accounting purposes than the depreciation for income tax purposes in the future period, thereby, the MAT credit will be utilized post tax holiday period.

20. During the year, the Company has entered into arrangement for proposed joint venture with strategic investor for the development and operation of container terminal (CT-3) at Mundra Port. As per the terms of the arrangement, both APSEZL and strategic investor will hold stake of 50% each in Adani International Container Terminal Private Limited (AICTPL). Pursuant to the terms of the arrangement, APSEZL has identified fixed assets viz. 810 metres jetty and back up yard at south port worth Rs 25,712.77 lacs (under construction) to be transferred to AICTPL and has accordingly accounted as "Assets held for sale".

Other Commitments

a) The port projects of subsidiary companies viz. Adani Hazira Port Private Limited, Adani Petronet (Dahej) Port Private Limited and Adani Murmugao Port Terminal Private Limited has been funded through various facility agreements from banks and financial institutions. Against the said facilities availed by the subsidiary companies from the banks & financial institutions, the Company has executed a Sponsor Undertaking and Pledge Agreement whereby 51% of the holding would be retained by the Company at all points of time of which 30% holding is pledged and for the balance 21% holding, the Company has given a non-disposal undertaking to the lenders of respective subsidiary companies.

b) As per terms of sanction of US$ 800 million facility by State Bank of India (SBI) to Mundra Port Pty Limited (MPPL), a wholly owned subsidiary, the Company is committed to pledge its holding in MPPL and Adani Abbot Point Terminal Holding Pty Limited (AAPTHPL), subsidiary of the Company, in favour of SBI. The execution of pledge documents is pending as at March 31, 2012.

c) During the year, the Company has entered into an "Equity Subscription Agreement" to contribute equity in Mundra Port Pty Limited (MPPL), a wholly owned subsidiary for meeting capital expenditure requirements of Abbot Point transaction as and when required. In order to ensure timely subscription to equity, the bankers to the subsidiary had required a stand by letter of credit facility. Accordingly, APSEZL procured stand by letter of credit from Standard Chartered Bank, which in-turn is backed by a corporate guarantee issued by the Company in favor of Standard Chartered Bank amounting to AUD 51.75 Millions. As at March 31, 2012, no financing facility has been disbursed against the said credit facility and the same needs to be availed in case the Company does not bring the committed equity contribution in MPPL.

B) Contract revenue accrued in excess of billing amounting Rs 816.92 lacs (Previous Year Rs 593.30 lacs) has been reflected under the head "Other Assets" and billing in excess of contract revenue amounting to Rs Nil (Previous Year Rs 1,044.00 lacs) has been reflected under the head "Other Current Liabilities".

21. Contingent Liabilities not provided for

(Rs In Lacs)

Sr. Particulars As at As at No March 31, 2012 March 31,2011

a. Corporate Guarantees given to banks and financial institutions 4,73,324.15 26,372.00 against credit facilities availed by the subsidiaries and an entity over which key management personnel, directors and their relatives are able to exercise significant influence - Amount outstanding there against Rs 4,14,898.97 lacs (Previous Year Rs 16,411.14 lacs).

b. In earlier years, civil suits have been filed by the Customers for 751.50 751.50 recovery of damages caused to machinery in earthquake Rs 37.10 lacs (Previous Year Rs 37.10 lacs), to cargo stored in Company's godown Rs 94.40 lacs (Previous Year Rs 94.40 lacs) and loss due to mis-handling of wheat cargo Rs 620.00 lacs (Previous Year Rs 620.00 lacs). The said civil suits are currently pending with various Civil Courts in Gujarat. The management is reasonably confident that no liability will devolve on the Company in this regard and hence no provision is made in the books of accounts towards these suits c. In earlier years, the Company had received show cause 257.57 260.19 notices from the Custom Authorities for recovery of custom duty and interest thereon on the import of a tug and bunkers by the Company Rs 207.15 lacs (Previous Year Rs 207.15 lacs), import of various Cargos at Port Rs 50.42 lacs (Previous Year Rs 53.04 lacs). The Customs cases are currently pending with, Custom, Excise and Service Tax Appellate Tribunal, Ahmedabad (Rs 207.15 lacs), Assistant Commissioner of Customs, Mundra (Rs 14.20 lacs), Customs, Excise and Service Tax Appellate Tribunal, Mumbai (Rs 26.60 lacs), Commissioner of Customs (Appeals), Kandla (Rs 5.00 lacs) and Deputy Commissioner of Customs Mundra, (Rs 4.62 lacs), respectively. The management is reasonably confident that no liability will devolve on the Company and hence no liability has been recognised in the books of accounts.

d. oint Commissioner Customs, Mundra has held the Company - 7.59 liable for custom duty on short delivery of imported goods of various Customers namely, H.M.S. through Mundra Port. The Company has been directed to remit the differential duty of Rs 7.09 lacs and penalty of Rs 0.50 lacs - under section 117 of the Customs Act. During the current year, the matter has been settled and APSEZL has paid the full amount along with interest to the concerned authorities.

e. Deputy Commissioner of Customs, Mundra and Assistant 26.31 26.31 Commissioner of Customs, Mumbai have held that the Company wrongly availed duty benefit exemption under DFCEC Scheme on import of equipment and demanded duty payment of Rs 26.31 lacs (Previous Year Rs 26.31 lacs). The Company has filed its reply to the show cause notice with Deputy Commissioner of Customs, Mundra and Commissioner of Customs, Mumbai against order in original. The management is of view that no liability shall arise on the Company.

f. Various show cause notices received from Commissioner/ Additional 6,723.23 6,528.30 Commissioner/ Joint Commissioner/ Deputy Commissioner of Customs and Central Excise, Rajkot and Commissioner of Service Tax, Ahmedabad, for wrongly availing of Cenvat credit/ Service tax credit and Education Cess credit on input services and steel, cement and other misc. fixed assets. The Excise department has demanded recovery of the duty along with penalty and interest thereon. The Company has given deposit of Rs 450 lacs (Previous Year, Rs 250 lacs) against the demand. The matters are pending before High Court of Gujarat, Commissioner of Central Excise (Appeals), Rajkot and Commissioner of Service Tax, Ahmedabad.

The Company has taken an external opinion in the matter based on which the management is of the view that no liability shall arise on the Company.

g. Show cause notices received from Commissioner of Customs 689.72 1,681.57 and Central Excise, Rajkot in respect of levy of service tax on

various services provided by the Company and wrong availment of Cenvat credit by the Company. The matter is currently pending at High Court of Gujarat Rs 672.47 lacs (Previous Year Rs Nil); Customs,

Excise and Service Tax Appellate Tribunal, Ahmedabad Rs 15.47 lacs (Previous Year Rs 851.70 Lacs) and Commissioner of Service Tax Ahmedabad Rs 1.78 lacs (Previous Year Rs 829.87 lacs). The Company has taken an external opinion in the matter based on which the management is of the view that no liability shall arise on the Company.

h. Commissioner of Customs, Ahmedabad has demanded vide letter 200.00 200.00 no.4/Comm./SIIB/2009 dated 25/11/2009 for recovery

of penalty in connection with import of Air Craft which is owned by Karnavati Aviation Private Limited (Formerly Gujarat Adani Aviation Private Limited), subsidiary of the Company.

Company has filed an appeal before the Customs, Excise and Service Tax Appellate Tribunal against the demand order, the management is reasonably confident that no liability will devolve on the Company and hence no liability has been recognized in the books of accounts .

22. a) During the year, the Company acquired assets of Abbot Point Coal Terminal in Australia from North Queensland Bulk Ports Corporation Limited, Australia at total consideration of AUD 1,829 million. The terminal asset are held through subsidiaries including step down subsidiaries formed during the year.

b) During the year, the Company was awarded Concession for development of Port Infrastructure facilities by Vizag Port Trust and Kandla Port Trust.

Note :

1. All loans are given on interest free basis except loan to Adani Petronet (Dahej) Port Private Limited and Mundra SEZ Textiles and Apparel Park Private Limited.

2. All the above loans are repayable as per the terms of the agreement entered into and are in the nature of long term loans.

23. Previous year figures

Till the year ended March 31, 2011, the company was using pre-revised Schedule VI to the Companies Act 1956, for preparation and presentation of its financial statements. During the year ended March 31, 2012, the revised Schedule VI notified under the Companies Act 1956, has become applicable to the company. The company has reclassified previous year's figures to conform to this year's classification. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However, it significantly impacts presentation and disclosures made in the financial statements, particularly presentation of balance sheet.


Mar 31, 2011

1. (Note No. 3 of Sechedule 23)

Segment Information

The Company is primarily engaged in the business of developing, operating and maintaining the Mundra Port and Port based related infrastructure facilities including Multi product Special Economic Zone. The entire business has been considered as a single segment in terms of Accounting Standard-17 on Segment Reporting issued by the Institute of Chartered Accountants of India (ICAI). There being no business outside India, the entire business has been considered as single geographic segment.

2. (Note No. 7 of Schedule 23)

Information required to be furnished as per Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) for the year ended March 31, 2011. This information has been determined to the extent such parties have been identified on the basis of information available with the Company. This has been relied upon by the auditors.

3. (Note No. 8 of Schedule 23)

Prior period item includes reversal of Income from Lease / Infrastructure Usage Rs. Nil (Previous Year Rs. 2,215.66 Lacs)

4. (Note No. 9 of Schedule 23)

The Government of India (GOI) has, vide its letter dated April 12, 2006, granted approval to the Companys proposal for development, operation and maintenance of a Multi-product Special Economic Zone (SEZ) at Mundra, Gujarat. Subsequently through a Notification dated June 23, 2006, the Ministry of Commerce & Industry (Department of Commerce) has included Mundra Port and Port Limits in notified Special Economic Zone.

Based on the opinion obtained by the Company, the Company has been availing benefit u/s 80IAB of the Income Tax Act, 1961 on the taxable income of the Company including Special Economic Zone operations w.e.f. accounting year 2007-08, and tax provision is made in accordance, therewith.

Accordingly, the Company has made provision of Rs. 2,234.74 Lacs for current taxation based on its profit excluding SEZ (including notified port area) profit for the year ended March 31, 2011. Provision for dividend distribution tax has not been made as Company is not liable to pay dividend distribution tax in terms of section 115-O (6) of the Income Tax Act, 1961.

As per the assessment order for the financial year 2007-08, the tax authorities have passed order accepting Companys claim under section 80 -IAB of Income Tax Act, 1961.

5. (Note No. 10 of Schedule 23)

Details of employee benefits

1. The company has recognised, in the Profit and Loss Account for the current year, an amount of Rs. 274.26 Lacs (Previous Year Rs. 223.96 Lacs) as expenses under the following defined contribution plan.

2. The Company has a defined benefit gratuity plan. Every employee gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with Life Insurance Company of India (LIC) in the form of a qualifying insurance policy.

The following tables summarise the components of net benefit expense recognised in the Profit and Loss Account and the funded status and amounts recognised in the Balance Sheet for the respective plans.

6. Operating Expenses includes Handling and Storage Expenses of Rs. 16,489.97 Lacs (Previous Year Rs. 10,026.17 Lacs).

7. (Note No. 12 of Schedule 23)

a) For the purpose of recognition of income on lease / sub-lease transactions relating to land and related infrastructure, the Company has applied the principles of finance leases and operating leases as per Accounting Standard - 19 Leases. However, no disclosure has been made in terms of said Accounting Standard as lease arrangements to use land have been scoped out of the Standard. The future receivables on land transactions are disclosed under Other Current Assets. The liability relating to Lease Land is disclosed under Current Liabilities.

The cost of leased / sub-leased land is expensed under Operating expenses and annual income on land given on finance lease basis have been recognised under Income from operations. Annual discounting on GMB Land is expensed as rent as a part of Administrative and Other Expenses.

b) Assets taken under Operating Leases - office space and residential houses for staff accommodation are obtained on operating leases. The lease rent terms are generally for eleven months period and are renewable by mutual agreement. There are no sub- leases and leases are cancelable in nature. There are no restrictions imposed by the lease arrangements. There is no contingent rent in the lease agreements and there is no escalation clause in the lease agreements. Expenses of Rs. 168.52 Lacs (Previous Year Rs. 126.90 Lacs) incurred under such leases have been expensed in the Profit & Loss Account.

B) Contract revenue accrued in excess of billing amounting Rs. 593.30 Lacs (Previous Year Rs. 4,080.24 Lacs) has been reflected under the head "Other Current Assets" and billing in excess of contract revenue amounting to Rs. 1,044.00 Lacs (Previous Year Rs. Nil) has been reflected under the head "Current Liabilities".

8. (Note No. 16 of Schedule 23)

Contingent Liabilities not provided for (Rs. in Lacs)

Particulars As at As at March 31, 2011 March 31,2010

Corporate Guarantees given to banks and financial institutions against credit facilities availed 26,372.00 26,328.32 by the subsidiaries and an associate entity- Amount outstanding there against Rs. 16,411.14 Lacs (Previous Year Rs. 22,157.75 Lacs). Total amount of Contigent Liabilities not provided for 9,455.46 8,867.70

9. (Note No. 20 of Schedule 23)

The Company has 2,811,037 outstanding 0.01 % Non-Cumulative Redeemable Preference Shares of Rs. 10/- each issued at a premium of Rs. 990 per share. These shares are to be redeemed on March 28, 2024 at an aggregate premium of Rs. 27,829.27 Lacs. The Company credits the redemption premium on proportionate basis every year to Preference Share Capital, Redemption Premium Reserve (in earlier year termed as Preference Share Capital Redemption Reserve) and debits the same to Securities Premium Account as permitted by Section 78 of the Companies Act, 1956.

10. (Note No. 21 of Schedule 23)

Miscellaneous Expenditure - Share Issue Expenses

The Company reversed excess provision of Rs. Nil (Previous Year: Expenses of Rs. 228.73 Lacs) during the year, in connection with its Initial Public Offer (IPO). In terms of Section 78 of the Companies Act, 1956 the Company has adjusted the said share issue expense against the Securities Premium received from the said IPO.

11. (Note No. 22 of Schedule 23) Previous Year Comparative

Previous years figures have been regrouped where necessary to conform to this years classification.

iii) Depreciation on individual assets costing up to Rs. 5,000 and mobile phones, included under office equipments are provided at the rate of 100% in the month of purchase.

iv) Insurance spares/standby equipments are depreciated prospectively over the remaining useful lives of the respective mother assets.


Mar 31, 2010

1. (Note No. 3 of Schedule 23)

Segment Information

The Company is primarily engaged in the business of developing, operating and maintaining the Mundra Port and port based related infrastructure facilities including Multi product Special Economic Zone. The entire business has been considered as a single segment in terms of Accounting Standard-17 on Segment Reporting issued by the Institute of Chartered Accountants of India. There being no business outside India, the entire business has been considered as single geographic segment.

2. (Note No. 4 of Schedule 23)

Related Party Disclosures

The Management has identified the following Companies and individuals as related parties of the Company for the year ended March 31, 2010 for the purposes of reporting as per AS 18 - Related Party Transactions:

List of related parties (As certified by the management)

List of related parties of Mundra Port And Special Economic Zone Limited as on March 31,2010

Holding Company Adani Infrastructure Services Private Limited

Subsidiary Companies

Mundra SEZ Textile and Apparel Park Private Limited

MPSEZ Utilities Private Limited

Rajasthan SEZ Private Limited

Adani Logistics Limited [upto June 8,2009]

Adani Logistics Limited [Formerly Inland Conware Private Limited]

Karnavati Aviation Private Limited [Formerly Gujarat Adani Aviation Private Limited]

Adani Murmugao Port Terminal Private Limited [w.e.f. August 7, 2009]*

Mundra International Airport Private Limited [w.e.f. August 7,2009]*

Adani Hazira Port Private Limited [w.e.f. December 7,2009]*

Adani Petronet (Dahei) Port Private Limited [w.e.f. January 4,20101

Step down Subsidiary_Inland Conware (Ludhiana) Private Limited [upto June 8,2009]

Fellow Subsidiary

Baramati Power Private Limited [upto December 29,2009] Shankheshwar Buildwell Private Limited [upto December 14,2009] Adani Tradelinks Private Limited [w.e.f March 3, 2010]

Associates and Joint VenturesAdani Petronet (Dahej) Port Private Ltd. [upto January 3, 2010]

Key Management Personnel

Mr. Gautam S. Adani, Chairman and Managing Director

Mr. Rajeeva Ranjan Sinha, Whole time Director

Dr. Malay R. Mahadevia, Whole time Director [w.e.f May 20,2009]

Mr. Ameet H. Desai, Executive Director [upto October 31, 2009]

Relative of Key Management Personnel Mr. Rajesh S. Adani, Director

Entities over which Key Management Personnel, Directors and their relatives are able to exercise significant influence

Adani Enterprises Limited

Adani Power Limited

Adani Gas Limited [w.e.f. January 8,2010]

Adani Welspun Exploration Limited

Adani Wilmar Limited

Adani Agro Private Limited

Adani Properties Private Limited

Adani Shipyard Private Limited [upto March 31,2010]

Dholera Infrastructure Private Limited [w.e.f March 31,2010]

Shantikrupa Estates Private Limited

Adani Energy Limited [upto January 6, 2010]

Adani Foundation

Adani Tradelinks [upto March 2, 2010]

Dholera Port and Special Economic Zone Limited [w.e.f March 31,2010]

Adani Education and Research Foundation

Gujarat Adani Institute of Medical Science

* These entities have been incorporated/formed during the year.

Aggregate of transactions for the year ended with these parties have been given below.

Notes:

1. The names of the related parties and nature of the relationships where control exists are disclosed irrespective of whether or not there have been transactions between the related parties. For others, the names and the nature of relationships is disclosed only when the transactions were entered into by the Company with the related parties during the existence of the related party relationship.

2. No amount has been provided as doubtful debts or advances/written off or written back in the period in respect of debts due from/ to above related parties.

3. Pass through charges relating to railway freight and other charges payable to third parties have not been considered for the purpose of related party disclosure.

3. (Note No. 9 of Schedule 23)

The Government of India (GOI) has, vide its letter dated April 12, 2006, granted approval to the Companys proposal for development, operation and maintenance of a Multi-product Special Economic Zone (SEZ) at Mundra, Gujarat. Subsequently through a Notification dated June 23, 2006, the Ministry of Commerce & Industry (Department of Commerce) has included Mundra Port and Port Limits in notified Special Economic Zone.

The Company is of the view, supported by an external opinion, that it may avail benefit u/s 80IAB of the Income Tax Act, 1961 on the entire income of the Company including the Special Economic Zone Operations. Accordingly, the Company has decided to avail benefits u/s 80IAB of the Income Tax Act, 1961 from accounting year 2007-08, and tax provision are made in accordance, therewith.

2. The Company has a defined gratuity plan. Every employee gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with Life Insurance Company of India (LIC) in the form of a qualifying insurance policy.

The following tables summarise the components of net benefit expense recognised in the profit and loss account and the funded status and amounts recognised in the balance sheet for the respective plans.

4. (Note No. 12 of Schedule 23) Income from Operations includes:

a. Land Lease Income, Upfront Premium, Long-term Infrastructure Usage Income and Income incidental thereto of Rs. 11,415.17 lacs (Previous Year Rs. 10,370.46 lacs).

b. Construction contract revenue income of Rs. 10,941.82 lacs (Previous Year Rs. 3,696.42 lacs)

5. Operating Expenses includes Handling and Storage Expenses of Rs.10,026.17 lacs (Previous Year Rs.12,040.96 lacs).

6. (Note No. 18 of Schedule 23)

Contingent Liabilities

(Rs. in lacs)

Particulars March 31,2010 March 31,2009

Corporate Guarantees given to banks and financial institutions against credit facilities 26,328.32 6,200.00 availed by subsidiaries and an associate entity - Amount outstanding there against Rs. 22,157.75 lacs (Previous Year Rs. 6,200.00 lacs)

Total amount of Contingent Liabilities not provided for 8,867.70 10,195.08

7. (Note No. 25 of Schedule 23)

The Company has 2,811,037 outstanding 0.01 % Non-Cumulative Redeemable Preference Shares of Rs.10 each issued at a premium of Rs.990 per share. These shares are to be redeemed on March 28, 2024 at an aggregate premium of Rs.27,829.27 lacs. The Company credits the redemption premium on proportionate basis every year to Preference Share Capital, Redemption Premium Reserve (in earlier year termed as Preference Share Capital Redemption Reserve) and debits the same to Securities Premium Account as permitted by Section 78 of the Companies Act, 1956.

8. (Note No. 26 of Schedule 23)

Miscellaneous Expenditure - Share Issue Expenses

The Company reversed excess provision of Rs.228.73 lacs (Previous Year: Expenses of Rs.754.25 lacs) during the year, in connection with its Initial Public Offer (IPO). In terms of Section 78 of the Companies Act, 1956 the Company has adjusted the said share issue expense against the Securities Premium received from the said IPO.

9. (Note No. 27 of Schedule 23) Previous Year Comparative

Previous years figures have been regrouped where necessary to conform to this years classification.

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