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Directors Report of 20 Microns Ltd.

Mar 31, 2015

Dear Members,

The Directors have pleasure to present their 28th Annual Report and the Audited Annual Accounts for the year ended 31st March, 2015.

Financial Results

The Company's financial performance for the year ended 31st March, 2015 is summarized below:

(Rs. in Lacs)

Particulars 2014-15 2013-14

Total Revenue 31966.42 29915.28

Profit before Depreciation, Interest and Tax (PBDITA) 2975.98 3185.69

Interest for the year 2492.05 2168.96

Depreciation for the year 945.20 1007.51

Profit/(Loss) before tax and Exceptional item (461.27) 9.12

Exceptional items - -

Profit/(loss) for the year (461.27) 9.12

Tax liability :-

Current Year's Tax - 9.00

MAT Credit - (9.00)

Deferred Tax Liability/(Asset) (55.57) (4.99)

Wealth Tax 1.71 1.05

Net Profit/(Loss) for the year (407.41) 13.06

State of Company's Affairs

During the year under consideration, following important developments have taken place,

a) Debt Restructuring by Consortium Bank :- As the capacity utilization of newly expanded capacity was very low due to sluggish demand the expected cash generation was not taking place and it was expected to have impact on the repayment schedule of various term loans availed by the Company. Company had approached its Bankers with a request to restructure repayment schedule of various terms loans, consortium bank approved the same in the Month of March 2015 giving effective date as 1st April 2014 and as a result the installment which were due during the year were restructured along with interest payable there on.

b) The restructuring of various term loans will help improvement in liquidity position of the Company over a period of time.

c) During the year various cost factors such as Raw Material, Energy Cost, Freight Cost and Finance cost have given negative impact on the overall margin of the business which has impacted overall profitability of the business.

d) Company had devised a strategy to ensure higher capacity utilization of various plants during the coming year which will increase overall performance of the Company in future.

e) Net Worth of the Company is reduced to Rs. 6967.44 Lacs as on 31st March, 2015 compared to Rs. 7440.81 Lacs as on 31st March, 2014.

Dividend

Due to loss, your directors have not recommended dividend during the year under consideration.

Material Changes and commitments affecting financial position between the end of the financial year and the date of report

The Company has issued and allotted 14,70,600 Equity shares of the face value of Rs. 5/- each at a premium of Rs. 29/- per share upon conversion of equivalent Compulsorily Convertible Warrants of the face value of Rs. 34/- each.

FIXED DEPOSITS

The Company has started accepting the deposits only from the shareholders of the company pursuant to the provisions of Companies Act, 2013 and Rules made thereunder. The said Scheme was approved by you at your Extra-ordinary General Meeting held on 24th May, 2014

As on 31.03.2015, Fixed Deposits from Shareholders stood at the total of Rs. 917.31 Lacs. No deposits are due for repayment on or before 31.03.2015.

The company has not made any default in repayment of deposits or interest due thereon.

The deposits accepted upto the 31st March, 2014 pursuant to Companies Act, 1956 and interest thereon will be repaid to the depositors on the date of maturity of respective deposits. In this regard, the Company has filed petition with Company Law Board praying to allow the repayment as per maturity of respective deposit only. Matter is pending before Company law Board. The details of outstanding amount of unsecured deposits accepted by the Company upto 31st March, 2014 and interest thereon, as per the then scheme of the Company, pursuant to Companies Act, 1956 is as under -

Number of Deposit Interest Depositors Rs. in lacs Rs. in lacs

(a) From Share Holders 269 273.09 22.03

(b) From Public 1148 606.91 49.42

TOTAL 1417 880.00 71.45

The Company is liable to comply with the provisions relating to acceptance of deposits under the Companies Act, 2013 and Rules made there-under and any amendments made from time to time.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Companies Act, 2013 ("the Act") and Accounting Standard (AS - 21) on Consolidated Financial

Statements, the audited consolidated financial statement is provided in the Annual Report.

Subsidiaries, Joint Ventures and Associates

As on 31st March, 2015, we have 03 subsidiaries. During the year, the Board of Directors (the Board) reviewed the affairs of the subsidiaries. In accordance with Section 129(3) of the Companies Act, 2013, we have prepared consolidated financial statements of the Company and all its subsidiaries, which form part of the Annual Report. Further, a statement in the prescribed format AOC-1 is appended as Annexure A to the Board's Report. The statement also provides the details of performance, financial positions of each of the subsidiaries.

In accordance with Section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and related information of the Company and audited accounts of each of its subsidiaries are available on our website www.20microns.com. These documents will also be available for inspection during business hours at our registered office in Waghodia, Vadodara, India.

Directors' Responsibility Statement

The directors report that

i) In the preparation of the annual accounts for the year ended 31st March, 2015, the applicable accounting standards have been followed and there are no material departures from the same.

ii) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at 31st March, 2015 and of the profit of the Company for the year ended on that date.

iii) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

iv) The Directors have prepared the annual accounts on a going concern basis.

v) the Directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

vi) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

General Shareholders Information

General Shareholder Information is given in the Report on Corporate Governance forming part of the Annual Report.

Particulars Regarding Employees

The table containing the names and other particulars of employees in accordance with the provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is appended as Annexure B to the Board's Report.

In terms of Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, we have to state that since there are no employees falling within the purview of the said requirements, the same has not been annexed herewith.

Corporate Governance

As required by Clause 49 of the Listing Agreement with the Stock Exchanges, the Corporate Governance Report and the Auditor's Certificate regarding compliance of conditions of Corporate Governance, form part of the Annual Report.

Secretarial Audit

Secretarial Audit Report as per Section 204 of Companies Act 2013 is placed as annexure to this report. No adverse comments have been made in the said report by the Practicing Company Secretary.

Cost Audit Compliance

Pursuant to Sec. 209 (1)(d) of the Companies Act, 1956, Cost Audit Report for the financial year ended 31/03/2014 was submitted to the Central Government on 29/09/2014.

Related Party Transactions

Particulars of transactions with related parties referred to in Section 188(1) of the Companies Act, 2013, in the prescribed Form AOC-2 is annexed in Annexure C to the Board's Report.

Extract of Annual Return and other disclosures under Companies (appointment and Remuneration) Rules, 2014

The Extract of Annual Return in form No. MGT-9 as per Section 134 (3) (a) of the Companies Act, 2013 read with Rule 8 of Companies Act (Accounts) Rules 2014 and Rule 12 of Companies (Management and Administration) Rules, 2014 is annexed in Annexure D hereto and forms part of this report.

Particulars of Loans, guarantees or investments

Loans, guarantee and investment covered under Section 186 of the Companies Act, 2013 form part of the notes to the financial statements provided in this Annual Report.

Conservation of Energy, technology absorption, foreign exchange earnings and outgo

Information as per Companies(Disclosure of particulars in the Report of Board of Directors) Rules, 1988 relating to conservation of energy, technology absorption, foreign exchange earnings and outgo are given in Annexure E forming part of this report.

Risk Management Policy implementation

In today's economic environment, Risk Management is a very important part of business. The main aim of risk management is to identify, monitor and take precautionary measures in respect of the events that may pose risks for the business. Your Company's risk management is embedded in the business processes. The Board of Directors of the Company has identified the following risks:

Sr. Department Risk Factor No.

1. Mining - Increase in Regulatory and legislative Compliance

- High Fuel Cost

- Local Community activist

2. Source/Purchase - Change in Rules/Regulations relating to Tariff

- Quality Compliance

- Fluctuation in Logistic Cost

- High risk that our vendor may sell same products to our competitor and grab our newly developed market, for developing such product we have spent much time and money

3. Operation/Production - Quality Compliance of plant

- Compliance to various laws relating to environment, health and safety, electricity etc

- Obtaining and renewing various licenses

4. Logistics - increase in railway freight

- Change in policies by Road and Transport Authority

5. Marketing / Sales - Competition

- Quality Problem. Frequent Quality Issues leading to Customer Loss

- Attrition Ratio and losing key employees to competition

- Logistic Cost

- Threat of Import Sales

6. Finance - Dependency on workbanker

- Frequent change in bank interest rate, exchange rate and taxation rates

7. Research and Development - Maintenance of database of ongoing Research

- Leakage of information

8. HR and Administration - Employee Turnover

- Selection of wrong person

- information leakage

- Compliance of various labour laws and deduction of TDS

9. Legal, Secretarial, - changes in corporate laws and Trade Marks non-compliance penalty involved therein

10. Insurance - exclusions given in each policy

- hidden terms and conditions of policies

11. Export - Change in Government Policy

- change in exchange rate

- issues relating to Quality of Material and Packaging of material (especially after reaching foreign warehouses)

12. Information Technology - Data backup and its security,

- insufficient software licenses,

- frequent change in Technology

- Risk of Data Loss/hacking

Corporate Social Responsibility:

The Corporate Social Responsibility Committee (CSR Committee) has been formulated. The Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, has been approved by the Board.

The CSR Policy may be accessed on the Company's Website at the link: http://www.20microns.com/admin/upload/csr/ CSR%20Policy.pdf

As part of the Corporate Social Responsibility, initiatives through the years, the Company established its arm - 20 Microns Foundation Trust in 2001 for the earthquake affected people. Post-earthquake rehabilitation, continuing the CSR activates in mind company thought to focus its activates on a very commonly spread health disease i.e. Diabetes. As a step forward under the 20 Microns foundation a charitable trust and the company support, "The Diabetes Centre" was inaugurated by 20 Microns Foundation Trust on 14th November, 2008 being World Diabetes Day.

During the year, the company has not spent any amount on CSR activities. The Company faced the financial crisis and restructuring of advances was approved by the Consortium Banks i.e. State Bank of India and IDBI Bank. In such a gloomy situation, it was not possible for the Company to spend for CSR activities. However, as reported earlier in Management Discussion & Analysis, CSR activities being carried out by the management of the Company, the said activities were carried on with the donations collected by the Trust from other sources. The Company will try to contribute to Corporate Social Responsibility to serve the general public at large during current fiscal year. The annual report on our CSR activities is appended as Annexure F to the Board's Report.

Internal Control System Adequacy

The Company has established proper and adequate system of internal control to ensure that all resources are put to optimum use and are well protected against loss and all transactions are authorized, recorded and reported correctly and there is proper adherence to policies and guidelines, processes in terms of efficiencies and effectiveness. The Company's internal control systems are supplemented by an extensive programme of internal audit by an independent firm.

All the transactions are conducted using the IT interface and the business processes are further audited by internal auditors.

The Company's internal control systems are also periodically tested and certified by the internal auditors. The Audit Committee constituted by the Board constantly reviews the internal control systems.

Directors and Key Managerial Personnel

The Board has appointed Dr. Ajay I. Ranka as an Additional Director w.e.f. 27th September, 2014. He holds office of Additional Director up to the ensuing Annual General Meeting of the Company The Company has received a notice u/s 160 of the Companies Act, 2013 from a shareholder of the Company proposing the candidature of Dr. Ajay I. Ranka for the office of an Independent Director to hold the office upto the conclusion of the annual general meeting of the Company to be held in the calendar year 2019.

In accordance with the Articles of association of the Company, Mr. Rajesh C. Parikh, Chief Executive Officer and Managing Director of the company, retire by rotation at this Annual General Meeting and being eligible offers himself for re- appointment.

During the year under review, the Members approved the appointments of Mr. Pravinchandra M. Shah, Mr. Ram Devidayal, Mr. Atul H. Patel and Mrs. Darsha R. Kinani as Independent Directors of the Company who are not liable to retire by rotation. Mr. Bharat Kanani appointed as Chief Financial Officer of the Company w.e.f. 06th August, 2014.

The Company has set criteria for performance evaluation of Independent Directors, Board, Committees and other individual Directors. The note on familiarization programme to Independent Directors are put on the website of the Company at the link http://www.20microns.com/admin/upload/ Miscellaneous/Familiarization%20Programme%20for% 20Independent%20Directors.pdf

The Company has also prepared a Remuneration Policy for the Directors, Key Managerial Personnel and Senior Management Employees which is put on the website of the Company at the link -

http://www.20microns.com/admin/upload/

Remuneration_Policy/20ML_Remuneration%20Policy.pdf

None of the Directors of the Company is disqualified under Section 164(2) of the Companies act, 2013. As required by law, this position is also reflected in the Auditors' Report.

In accordance with provisions of Section 149 of the Companies Act, 2013 and the Listing Agreement with the Stock Exchanges, Mr. P M. Shah, Mr. Ram Devidayal, Mr. Atul Patel Mrs. Darsha Kikani and Dr. Ajay Ranka have given a declaration to the Company that they meet the criteria of independence as mentioned in Section 149(6) of the Companies Act, 2013 read with Clause 49(I)(A)(iii) of the Listing Agreement.

Auditors

A. Statutory Auditors

The Company Auditors, M/s Manubhai and Shah, Chartered Accountants, retire at the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. In accordance with Section 139(1) of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, it is proposed to appoint Manubhai and Shah as Statutory Auditors of the Company for one year at this Annual General Meeting.

B. Internal Auditors

The Company has appointed M/s. N C Vaishanav and Co., M/s. P Mani and Co. and M/s. Deopura and Associates, Chartered Accountants as Internal Auditors of the Company for the F.Y 2015-16, for the Western Region and Eastern Region, South Region and North Region, respectively.

C. Cost Auditors

The Company has appointed M/s Y.S. Thakar and Co., Cost Accountants, to audit its cost accounting records relating to Mining and Metallurgy of ferrous and non- ferrous metals for the Financial Year 2015-16 subject to ratification of his remuneration by shareholders of the Company.

The Company is seeking the ratification of the Shareholders for the remuneration payable to M/s YS. Thakar and Co., Cost Accountants as the Cost Auditors of the Company for the Financial Year 2015-16 vide resolution no. 4 of the Notice of AGM.

D. Secretarial Auditors

As per provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company is required to appoint Secretarial Auditor to carry out Secretarial Audit of the Company. The Company has appointed M/s. J.J. Gandhi and Co., Practicing Company Secretaries as Secretarial Auditors of the Company for the FY 2015-16.

Significant and material orders

There are no significant and material orders passed by the regulator or courts or tribunal impacting the going concern status and Company's operations in future.

Disclosures:

CSR Committee

The CSR Committee comprises of Mr. PM. Shah, Mr. Chandresh Parikh and Mr. Sudhir Parikh, as Members of the Committee.

Audit Committee

The Audit Committee comprises Independent Directors namely Mr. Ram Devidayal, Mr. PM. Shah and Mr. Atul Patel as Members of the Committee. All the recommendations made by the Audit Committee were accepted by the Board.

Vigil Mechanism

The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in terms of the Listing Agreement. Vigil Disclosures can made by a whistle blower through an email to the Chairman of the audit Committee. The policy of vigil mechanism may be assessed on the Company's website at the link: http://www.20microns.com/admin/upload/ Miscellaneous/Vigilence%20policy.pdf

Meeting of the Board

Six meetings of Board of Directors were held during the year. For further details, please refer report on Corporate Governance annexed to this Annual Report.

Acknowledgement

Your Directors wish to express their grateful appreciation for the co-operation and support received from customers, vendors, shareholders, Financial Institutions, Banks, Regulatory Authorities and the Society at large.

Deep appreciation is also recorded for the dedicated efforts and contribution of Executives, Staff and Workers of the Company.

For and on behalf of the Board of Directors

Chandresh S. Parikh

Executive Chairman

Place : Waghodia, Vadodara

Date : 07th August, 2015




Mar 31, 2014

Dear Members,

The Directors'' are pleased to present the 27th Annual Report and the Audited Accounts for the year ended 31st March, 2014.

1. FINANCIAL HIGHLIGHTS

[Rs. In Lacs]

Particulars 2013-14 2012-13

Total Revenue 29915.28 28123.26

Profit before Depreciation, Interest and Tax (PBDITA) 3185.59 3720.38

Interest for the year 2168.96 1554.68

Depreciation for the year 1007.51 748.42

Profit before tax and Exceptional item 9.12 1417.28

Exceptional items 0.00 851.93

Profit/(loss) for the year 9.12 565.35

Tax liability : Current Year''s Tax 10.05 148.01

MAT Credit (9.00) 147.00

Deferred Tax Liability/(Asset) (4.99) 239.97

Net Profit for the year 13.06 324.37

2. DIVIDEND

In view of the paucity of resources, the Directors have not

recommended any Dividend.

3. MANAGEMENT DISCUSSIONS AND ANALYSIS

4. FIXED DEPOSITS

As on 31.03.2014, Fixed Deposits from Public and Shareholders stood at the total of Rs. 2135.88 Lacs. 56 deposits totaling to Rs. 26.58 Lacs due for repayment on or before 31.03.2014 were not claimed by the depositors as on that day. The Company is liable to comply with the provisions relating to acceptance of deposits under the Companies Act, 2013 and Rules made thereunder and any amendments made from time to time.

5. SUBSIDIARIES

20 Microns Nano Minerals Limited Your Company holds 99.17% equity shares of 20 Microns Nano Minerals Limited. The said Company is having a state of the art In-house Research & Development facility which is registered with Department of Science & Industrial Research (DSIR), Ministry of Science and Technology, Government of India. During the year under review, the said Company reported revenue from operations of Rs. 1966.27 Lacs and incurred Net Loss of Rs. 16.72 Lacs. 20 Microns SDN. BHD.

Your Company holds 99.99% of 20 Microns Sdn. Bhd. During the year under review, the said Company reported Gross Revenue of RM 28.79 Lacs and earned Net profit of RM 4.22 Lacs (Malaysian currency).

20 Microns FZE

Your Company owns 100 percent of 20 Microns FZE. During the year ending 31/03/2014, the said Company reported Revenue was AED 113.35 Lacs and the Net Profit was AED 21.00 Lacs.

As per Section 212(1) of the Companies Act, 1956, the Company is required to attach to its Accounts, the Directors'' Report, Balance Sheet and Profit & Loss Account of each of its Subsidiaries. As the Consolidated Accounts present a complete picture of the financial results of the Company and its Subsidiaries and in view of General Circular No. 2/2011 dated 08.02.2011 and No.

3/2011 dated 21.02.2011 issued by Ministry of Corporate Affairs, the Annual Report of the Company does not contain the individual financial statements of its Subsidiaries. However, the statement of your Company''s interest in the Subsidiaries as at 31st March, 2014, prepared in accordance with the provisions of Section 212 of the Companies Act, 1956 is attached to the Balance Sheet.

The Annual Accounts of the Subsidiary Companies along with the related detailed information are available for inspection by the shareholders of the Company and of the Subsidiary Companies at the Company''s Registered Office and at the registered office of the concerned Subsidiaries and copies of the same shall be provided to any shareholder on demand.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Audited Financial Statements, based on the same received from the Subsidiary Companies, as approved by its Board of Directors, have been prepared in accordance with AS - 21 on Consolidated Financial Statement read with AS - 23 on Accounting for Investments in Associates.

6. AUDITORS'' REPORT

The Auditors'' Report is clean and there is no qualification in their Report.

7. DIRECTORS

The Board has appointed Mrs. Darsha R. Kikani as an Additional Director w.e.f. 06th August, 2014. She holds office of Additional Director up to the ensuing Annual General Meeting of the Company. The Company has received a notice u/s 160 of the Companies Act, 2013 from a shareholder of the Company proposing the candidature of Mrs. Darsha R. Kikani for the office of an Independent Director to hold the office for 5 [five] consecutive years for a term upto the conclusion of the annual general meeting of the Company to be held in the calendar year 2019.

Mr. PM. Shah, Mr. Ram Devidayal & Mr. Atul Patel, the Independent Directors of the Company, were liable to retire by rotation in terms of provisions of Companies Act, 1956. However, as per provisions of the Companies Act, 2013, the Independent Directors are required to be appointed by Shareholders for a term of upto five consecutive years and they shall not be liable to retire by rotation. Accordingly, it is proposed to appoint them as Independent Directors to hold their respective offices for 5 [five] consecutive years for a term upto the conclusion of the annual general meeting of the Company to be held in the calendar year 2019.

In accordance with the Articles of Association of the Company, Mr. Sudhir R. Parikh, Director - Finance & Mr. Atil C. Parikh, Managing Director, retire by rotation at this Annual General Meeting and being eligible offer themselves for re-appointment.

None of the Directors of the Company is disqualified under

Section 274(1)(g) of the Companies act, 1956. As required by law, this position is also reflected in the Auditors'' Report. In accordance with provisions of Section 149 of the Companies Act, 2013 and the Listing Agreement with the Stock Exchanges, Mr. P. M. Shah, Mr. Ram Devidayal, Mr. Atul Patel & Mrs. Darsha Kikani have given a declaration to the Company that they meet the criteria of independence as mentioned in Section 149(6) of the Companies Act, 2013 read with Clause 49(I)(A)(iii) of the Listing Agreement.

8. CORPORATE GOVERNANCE

As required by the existing Clause 49 VII of the Listing Agreements entered into with the Stock Exchanges, a detailed report on Corporate Governance is given as a part of the Annual Report. The Company is in full compliance with the requirements and disclosures that have to be made in this regard. The Auditors'' Certificate of the compliance with Corporate Governance requirements by the Company is attached to the Report on Corporate Governance.

9. GENERAL SHAREHOLDERS INFORMATION General

Shareholder Information is given in the Report on Corporate Governance forming part of the Annual Report.

10. PARTICULARS REGARDING EMPLOYEES

In terms of the provisions of Section 217(2A) of the Companies Act, 1956 read with The Companies [Particulars of Employees] Rules, 1975, as amended, we have to state that since there are no employees falling within the purview of the said requirements, the same has not been annexed herewith.

11. DIRECTORS'' RESPONSIBILITY STATEMENT

As stipulated under the provisions contained in Section 217(2AA) of the Companies Act, 1956, the Directors hereby confirm as under:

i. The applicable accounting standards have been followed in the preparation of the Annual Accounts along with proper explanations relating to material departures;

ii. Accounting policies are selected and applied consistently and judgments and estimates are made which are reasonable and prudent so as to give a true and fair view of the state of the affairs as at the end of financial year and of the profit of the Company for the year under review;

iii. The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. The Directors have prepared the accounts on a "going concern" basis.

12. ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE

Statement giving the particulars relating to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under the Section 217(1)(e) of the Companies Act, 1956 read with The Companies [Disclosure of Particulars in the Report of Board of Directors] Rules, 1988 is annexed.

13. AUDITORS

A. Statutory Auditors

The Company Auditors, M/s. Manubhai & Shah, Chartered Accountants, retire at the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. In accordance with Section 139(1) of the Companies Act, 2013 read with the Companies (Audit & Auditors) Rules, 2014, it is proposed to appoint Manubhai & Shah as Statutory Auditors of the Company for one year at this Annual General Meeting.

B. Internal Auditors

The Company has appointed M/s. N C Vaishnav & Co., M/s. P Mani & Co. & Deopura & Associates, Chartered Accountants as Internal Auditors of the Company for the F.Y 2014-15, for the Western Region & Eastern Region, South Region and North Region, respectively.

C. Cost Auditors

The Company has appointed M/s. Y S. Thakar & Co., Cost Accountants, to audit its cost accounting records relating to Mining & Metallurgy of ferrous & non-ferrous metals for the Financial Year 2012-13. The Cost Audit Report was filed with Ministry of Corporate Affairs.

The Company is seeking the ratification of the Shareholders for the appointment of M/s. YS. Thakar & Co., Cost Accountants as the Cost Auditors of the Company for the Financial Year 2014-15 vide resolution no. 5 of the Notice of AGM.

D. Secretarial Auditors

As per provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company is required to appoint Secretarial Auditor to carry out Secretarial Audit of the Company. The Company has appointed M/s. J. J. Gandhi & Co., Practicing Company Secretaries as Secretarial Auditors of the Company for the F.Y 2014-15.

14. ACKNOWLEDGEMENTS

Your Directors wish to express their grateful appreciation for the co-operation and support received from customers, vendors, shareholders, Financial Institutions, Banks, Regulatory Authorities and the Society at large.

Deep appreciation is also recorded for the dedicated efforts and contribution of Executives, Staff & Workers of the Company.

For and on behalf of the Board of Directors

Chandresh S. Parikh Executive Chairman

Place: Waghodia, Dist. Vadodara Date:06.08.2014


Mar 31, 2013

To The Members of 20 MICRONS LIMITED

The Directors are pleased to present 26th Annual Report together with the Audited Statement of Accounts for the year ended 31stMarch,2013.

RESULTS OF OPERATIONS

(Rs.in Lacs)

Particulars 2012-13 2011-12

Total Revenue 28123.26 26770.17

Profit before Depreciation, Interest and Tax (PBDITA) 3720.38 3525.90

Interest forthe year 1554.68 1408.52

Depreciation for the year 748.42 631.80

Profit before tax and Exceptional item 1417.28 1485.58

Exceptional items 851.93 -

Profit/(loss) for the year 565.35 1485.58

Tax liability :-

Current Year''s Tax 148.01 363.25

MAT Credit 147.00 -

Deferred Tax Liability/(Asset] 239.97 44.26

Net Profit/(loss) for the year 324.37 1078.08

OVERVIEW OF ECONOMY

The world economy would grow 3.1 percent this year before accelerating to 4 percent in 2014. The estimates marked a slightly more pessimistic view after November in the Paris-based think tank forecast global growth of 3.4 percent this year and 4.2 percent next year. Notwithstanding policy action aimed at resolving it, the Euro Area crisis has deepened and new interventions have been necessary to prevent matters from deteriorating rapidly. At the end of the fiscal year, due to the high inflation rate, the growth rate of Indian Economy came to around 5.0 per cent is much lower than what was projected.

In this generally depressed scenario, the Company has achieved Gross Sales which stood atRs. 28,516.81 Lacs for the year. The management has taken measures as part of its continuous improvements to strengthen operations and viability. It has widened and improved the product range and price points in domestic as well as international markets to enlarge the customer base.

PERFORMANCE REVIEW

The Indian economy in April 2012 started with a certain flair but after the second quarter, the economy started to slow down and sluggishly ended the financial year with all the sectors of the economy being affected. Your company managed to register a satisfactory growth in spite of the challenging environment. Your Company witnessed slowdown in demand conditions in the last quarter. Industrial coatings segment continues to be impacted due to economic slowdown. Automotive coatings growth was affected due to subdued demand in the auto sector. Your Company''s International Business has recorded a good performance despite all the world''s major economies facing a slowdown. Plastics sector has done well even though economic uncertainty in some sub-sectors continues. Paper also has been through a sinusoidal ride as more competition of imported readymade papers are eating the market share of the domestic paper mills. Rubber was sluggish right throughout the year. Foundry and steel sectors also witnessed a flat curve as a result of the restrictive policies of coal and iron ore mining and pricing by the government.

Your company registered a nominal growth in top line of 6.5%. The bottom lines could have been better. However, higher depreciation, interest cost and overheads resulting from the commissioning of the Company''s fully mechanized jumbo milling manufacturing facility at Alwar, Rajasthan and Hosur, Tamil Nadu had an impact on the profit margins during the second half of this year.

The working of the Company during the year 2012-13 has been impacted due to adverse effect on the operations of the Bhuj Plant because of the shift of fuel source from imported coal base producer gas to Furnace oil. This was done to comply with the requirement of pollution control laws. The functioning has now been stabilized and it is expected that the loss of turnover would be regained in the Financial Year 2013-14.

During the year under report, your Company has achieved a Gross Turnover of Rs. 28516.81 Lacs (Up by 6.5% from Rs. 26768.68 Lacs of the previous year). The operations have resulted in a Net Profit before Depreciation, Interest and Tax [PBDITA] of Rs. 3,720.38 lacs as compared toRs.3,525.90 Lacs of the previous year.

With reference to the exceptional item in respect of loss on derivative contracts of Rs. 851.93 lakhs as included in the Statement of profit and loss of the Company, your Company has taken a pragmatic view, based on legal advice, not to litigate the issue further with the banks for which bank has provided liquidity comfort to the Company.

The company has invested in overseas subsidiary companies for expanding its business and during the year company at Sharjaha FZE has remitted dividend of Rs. 191.43 lakhs (Rs. 252.49 lakhs during the previous year).

PROJECT

During the year the Company has invested total amount of Rs. 72.32 Cr. to expand its micronized minerals and specialty chemical products totaling 89400 M.T.P.A. installing Jumbo mills at Alwar and Hosur and imported Wet grinding mill at Vadadla and calcined clay capacity by 16800 M.T.P.A. installing calciners and refined clay processing plants with 6000 M.T.P.A. for captive use at Bhuj & Tirunelvelly. The project cost has been financed by the Company from term loan borrowing and companies contribution by raising -quasi equity funds. It is expected to result into additional sale of manufactured products of approx. Rs. 99 Cr. subject to market conditions.

The growth rate is expected to continue along with higher profitability and inspire the Company and its dedicated staff to focus more attention on all its applications. The Current

year and all-coming years would walk on the foot prints with highest earnings and the continued support of effective sales force, improvement in production facilities and implementation of innovative ideas.

During the year, your Company vigorously followed steps to improve plant efficiency, customers'' satisfaction, cost reduction and exploitation of new applications. The Company is still continuing to consolidate, relocate and outsource manufacturing by constantly reviewing market scenario. Product development is an ongoing process carried out in a well equipped R&D Centre. This will enable the Company to review the range of products offered to the Customers.

The Company is always looking on enhancing the interest of all the stakeholders by better utilization of all its resources.

Your Company expects robust growth in existing products and contribution from new products by adopting the following strategies:

- Expansion of Mineral Portfolio by adding new products;

- Enhance value chain by launching new synthetic minerals products by leveraging R&D strength;

- Expand Geographical locations by acquiring Mines and infrastructure facilities in Mineral rich countries in Middle East & South East Asia.

DIVIDEND

Your Directors are pleased to recommend the payment of dividend 0 10% i.e.Rs. 0.50 per Equity Share of the face value of Rs. 5/- for the year under review. The dividend, subject to approval of shareholders, will be paid to the Shareholders whose name appears on the Register of Members as on the Book Closure dates.

SUB-DIVISION OFSHARES

The Shareholders of the Company, through Postal Ballot, considered and approved the sub-division of the Equity Shares of your Company whereby 01 (one) Equity Share having a nominal face value of Rs. 10/- (Rupees Ten Only) is sub-divided into 01 (one) Equity Share of nominal face value of Rs.5/- (Rupees Five Only).

FINANCE

Your Directors convey their grateful thanks to State Bank of India and IDBI Bank Limited for their continued support and co-operation.

FIXED DEPOSITS

As on 31.03.2013, Fixed Deposits from Public and Shareholders stood at the total of Rs. 1760.15 Lacs, 44 deposits totaling to Rs. 22.30 Lacs due for repayment on or before 31.03.2013 were not claimed by the depositors on that day. Out of these, deposits of Rs. 7.90 Lacs have since been repaid or renewed at the option of 19 depositors. No instructions have been received so far for the balance of Rs. 14.40 Lacs from 15 depositors. These deposits, if not claimed in future, shall be deposited in the ''Investors Education and Protection Fund'' in due course, as per the provisions of the Companies Act, 1956.

SUBSIDIARIES

a) 20 Microns Nano Minerals Limited

Your Company owns 99.17 percent of 20 Microns Nano Minerals Limited. The said Company is having a state of the art In-house Research & Development facility which is registered with Department of Science & Industrial Research (DSIR), Ministry of Science and Technology, Government of India. During the year under review, the said Company reported revenue from operations of Rs. 2,854.82 Lacs and Net loss of Rs. 35.39 Lacs.

b) 20MicronsSdn.Bhd.

Your Company owns 99.99 percent of 20 Microns Sdn. Bhd. During the year under review, the said Company reported Gross Revenue of RM 14.42 Lacs and Net loss of RM 0.10 Lacs.

c) 20 Microns FZE

Your Company owns 100 percent of 20 Microns FZE. During the year ending 31/03/2013, the said Company reported Gross Revenue of AED 116.35 Lacs and achieved Net profit of AED 28.96 Lacs.

As per Section 212(1] of the Companies Act, 1956, the Company is required to attach to its Accounts, the Directors'' Report, Balance Sheet and Profit & Loss Account of each of its Subsidiaries. As the Consolidated Accounts present a complete picture of the financial results of the Company and its Subsidiaries and in view of General Circular No. 2/2011 dated 08.02.2011 and No. 3/2011 dated 21.02.2011 issued by Ministry of Corporate Affairs, the Annual Report of the Company does not contain the individual financial statements of its Subsidiaries. However, the statement of your Company''s interest in the Subsidiaries as at 31st March, 2013, prepared in accordance with the

provisions of Section 212 of the Companies Act, 1956 is attached to the Balance Sheet.

The Annual Accounts of the Subsidiary Companies along with the related detailed information are available for inspection by the shareholders of the Company and of the Subsidiary Companies at the Company''s Registered Office and at the registered office of the concerned Subsidiaries and copies of the same shall be provided to any shareholder on demand.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Audited Financial Statements, based on the same received from the Subsidiary Companies, as approved by its Board of Directors, have been prepared in accordance with AS - 21 on Consolidated Financial Statement read with AS - 23 on Accounting for Investments in Associates.

CORPORATE GOVERNANCE

Pursuant to the requirements of the Listing Agreements with Stock Exchanges, your Directors are pleased to annex the following:

1. Management Discussions and Analysis Report

2. A report on Corporate Governance along with Auditors'' Certificate relating to compliance of conditions thereof. CEO Certificate regarding compliance with the Code of Conduct, are annexure forms part of this report.

PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 217(2A) of the Companies Act, 1956 read with The Companies [Particulars of Employees] Rules, 1975, as amended, we have to state that since there are no employees falling within the purview of the said requirements, the same has not been annexed herewith.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO.

In terms of the provisions of Section 217(1 ](e) of the Companies Act, 1956 read with The Companies [Disclosure of Particulars in the Report of Board of Directors] Rules, 1988, as amended, the particulars of Energy Conservation, Technology Absorption & Foreign Exchange Earnings and Out go are given in the Annexure-A to this Report.

INDUSTRIAL RELATIONS

Industrial relations remain cordial and peaceful at all levels of the Company throughout the year.

DIRECTORATE

Mr. Ram Devidayaland Mr. Rajesh C. Parikh, retire by rotation and being eligible, offer themselves for reappointment.

RESPONSIBILITY STATEMENT

Your Directors make following statements in terms of Section 217(2AA) of the Companies Act, 1956:

1. The applicable accounting standards have been followed in the preparation of the Annual Accounts along with proper explanations relating to material departures;

2. Accounting policies are selected and applied consistently and judgments and estimates are made which are reasonable and prudent so as to give a true and fair view of the state of the affairs as at the end of financial year and of the profit of the Company for the year under review;

3. The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. The Directors have prepared the accounts on a "going concern" basis.

AUDITORS

M/s. Manubhai & Co., Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. The Company has received a letter from Statutory Auditors to the effect that, in case their appointment is made, it would be within the specified limit under Section 224(1 B] of the Companies Act, 1956.

ACKNOWLEDGEMENT

Your Directors would like to express their grateful appreciation for assistance & co-operation received from the Government Authorities; Banks and Financial Institutions; Customers; Vendors; Investors; Depositors and all others.

Your Directors also wish to place on record deep sense of their appreciation for the valuable and committed services of the Executives, Staff & Workers of the Company.

For and on behalf of the Board of Directors

Chandresh S. Parikh

Chairman and Managing Director



Place: Waghodia, Dist. Vadodara

Date : 28.05.2013


Mar 31, 2012

To The Members of 20 MICRONS LIMITED

The Directors are pleased to present 25th Annual Report together with the Audited Statement of Accounts for the year ended 31st March, 2012.

RESULTS OF OPERATIONS: [Rs. in Lacs]

Particulars 2011-12 2010-11

Total Revenue 26770.19 23741.12

Profit before Depreciation, Interest 3525.91 2555.41

and Tax (PBDITA)

Interest for the year 1408.52 1061.61

Depreciation for the year 631.80 533.30

Profit before tax and Exceptional 1485.58 960.50

item

Exceptional items - 39.42

Profit/(loss) for the year 1485.58 921.08

Tax liability :-

Current Year's Tax & FBT 363.25 245.40

Earlier Years Tax Adjustments/MAT 65.61

Credit 44.26 60.28

Deferred Tax Liability/(Asset)

Net Profit/(loss) for the year 1078.08 550.19

OVERVIEW OF ECONOMY

The world economy has been passing through stress. Financial turmoil in Europe has affected other countries. This contagion has pushed up borrowing costs and slowed growth in many parts of the world, and capital flows to developing countries have fallen. As a result, and despite a strengthening of activity in the United States and Japan, world trade has slowed down. Under this scenario, the forecast for global economic growth has been revised downward to about 2.5% in 2012. Indian economy also slowed down in 2011-12 mainly due to weak industrial growth. Inflation remained a major concern constraining RBI to pursue tight monetary policy.

In this generally depressed scenario, the Company has achieved about 13% growth in Gross sales value which stood at Rs. 26770.19 Lacs for the year. The management has taken measures as part of its continuous improvements to strengthen operations and viability. It has widened and improved the product range and price points in domestic as well as international markets to enlarge the customer base.

PERFORMANCE REVIEW:

During the year under report, your Company has achieved a Total Revenue of Rs. 26770.19 Lacs (Up by 12.76% from Rs. 23741.12 Lacs of the previous year). The operations have resulted in a net Profit before Depreciation, Interest and Tax (PBDITA) of Rs. 3525.90 Lacs (Up by 37.97% from Rs. 2555.41 Lacs of the previous year).

DIVIDEND:

Your Directors are pleased to recommend the payment of dividend @ 18% i.e. Rs. 1.80 per Equity Share of the face value of Rs. 10/- each for the year under review. The dividend, subject to approval of shareholders, will be paid to the Shareholders whose name appears on the Register of Members as on the Book Closure dates.

FUTURE OUTLOOK

The Company has achieved a growth rate of 13% in Gross Sales during the year. This growth rate is expected to continue along with higher profitability and inspire the Company and its dedicated staff to focus more attention on all its applications. The Current year and all-coming years would walk on the foot prints of with highest earnings and the continued support of effective sales force, improvement in production facilities and implementation of innovative ideas.

During the year, the Company vigorously followed steps to improve plant efficiency, customers' satisfaction, cost reduction and exploitation of new applications. The Company is still continuing to consolidate, relocate and outsource manufacturing by constantly reviewing market scenario. Product development is an ongoing process carried out in a well equipped R & D Centre. This will enable the Company to review the range of products offered to the Customers.

The Company is always looking on enhancing the interest of all the stakeholders by better utilization of all its resources.

Your Company expects robust growth in existing Products and contribution of new products by adopting the following strategies:

Expansion of Mineral Portfolio by adding new products;

Enhance value chain by launching new synthetic minerals products by leveraging R&D strength;

Expand Geographical locations by acquiring Mines and infrastructure facilities in Mineral rich countries in Middle East & South East Asia.

FINANCE

It is gratifying to note that State Bank of India, in consortium with IDBI Bank Limited has enhanced the aggregate credit facilities from Rs.6278 Lacs to Rs. 7258 Lacs and IDBI Bank Ltd. (IDBI) has also given the working capital finance of Rs. 500 Lacs.

Your Directors convey their grateful thanks to SBI and IDBI for their continued support and co-operation.

FIXED DEPOSITS

As on 31.03.2012, Fixed Deposits from Public and Shareholders stood at the total of Rs. 1475.05 Lacs. 23 deposits totaling to Rs.10.81 Lacs due for repayment on or before 31.03.2012 were not claimed by the depositors on that day. Out of these, deposits of Rs. 2.90 Lacs have since been repaid or renewed at the option of 8 depositors. No instructions have been received so far for the balance of Rs. 7.91 Lacs from 15 depositors. These deposits, if not claimed in future, shall be deposited in the 'Investors Education and Protection Fund' in due course, as per the provisions of the Companies Act, 1956.

SUBSIDIARIES

a) 20 Microns Nano Minerals Limited

Your Company owns 99.17 percent of 20 Microns Nano Minerals Limited. The said Company is having a state of the art In-house Research & Development facility which is registered with Department of Science & Industrial Research (DSIR), Ministry of Science and Technology, Government of India. During the year under review, the said Company reported revenue from operations of Rs. 3035.04 Lacs and achieved Net Profit of Rs. 30.15 Lacs.

b) 20 Microns Sdn. Bhd.

Your Company owns 99.99 percent of 20 Microns Sdn. Bhd. During the year under review, the said Company reported Gross Revenue of RM 13.56 Lacs and achieved Net profit of RM 1.90 Lacs.

c) 20 Microns FZE

Your Company owns 100 percent of 20 Microns FZE. During the period ending 31/03/2012, the said Company reported Gross Revenue of AED 70.72 Lacs and achieved Net profit of AED 18.07 Lacs.

As per Section 212(1) of the Companies Act, 1956, the Company is required to attach to its Accounts, the Directors' Report, Balance Sheet and Profit & Loss Account of each of its Subsidiaries. As the Consolidated Accounts present a complete picture of the financial results of the Company and its Subsidiaries and in view of General Circular No. 2/2011 dated 08.02.2011 and No. 3/2011 dated 21.02.2011 issued by Ministry of Corporate Affairs, the Annual Report of the Company does not contain the individual financial statements of its Subsidiaries. However, the statement of your Company's interest in the Subsidiaries as at 31st March, 2012, prepared in accordance with the provisions of Section 212 of the Companies Act, 1956 is attached to the Balance Sheet.

The Annual Accounts of the Subsidiary Companies along with the related detailed information are available for inspection by the shareholders of the Company and of the Subsidiary Companies at the Company's Registered Office and at the registered office of the concerned Subsidiary and copies of the same shall be provided to any shareholder on demand.

CONSOLIDATED FINANCIAL STATEMENTS

The Audited Financial Statements, based on the same received from the Subsidiary Companies, as approved by its Board of Directors, have been prepared in accordance with AS - 21 on Consolidated Financial Statement read with AS - 23 on Accounting for Investments in Associates.

CORPORATE GOVERNANCE

Pursuant to the requirements of the Listing Agreements with Stock Exchanges, your Directors are pleased to annex the following:

1. Management Discussion and Analysis Report

2. A report on Corporate Governance along with Auditors' Certificate relating to compliance of conditions thereof.

3. CEO Certificate regarding compliance with the Code of Conduct.

These annexure forms part of this report.

PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 217(2A) of the Companies Act, 1956 read with The Companies [Particulars of Employees] Rules, 1975, as amended, the names and other particulars of the employees are required to be set out in the Annexure to the Report of the Board of Directors. We have to state that since there are no employees falling within the purview of the said requirements, the same has not been annexed herewith.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUT GO.

In terms of the provisions of Section 217(1)(e) of the Companies Act, 1956 read with The Companies [Disclosure of Particulars in the Report of Board of Directors] Rules, 1988, as amended, the particulars of Energy Conservation, Technology Absorption & Foreign Exchange Earnings and Out go are given in the Annexure - A to this Report.

INDUSTRIAL RELATIONS

Industrial relations remain cordial and peaceful at all levels of the Company throughout the year.

EMPLOYEES STOCK OPTION SCHEME [ESOS]

Details of the option granted, accepted and lapsed under Employees Stock Option Scheme - 2007 of the Company, as also the disclosures in compliance with the clause 12 of Securities and Exchange Board of India (Employees Stock Option Scheme & Employees Stock Purchase Scheme) Guidelines, 1999 are set out in the Annexure - B to this Report. The Auditors' Certificate relating thereto have been set out in the said Annexure.

DIRECTORATE

With effect from 29.04.2011, the Nomination of Mr. Munish Mohan had been withdrawn by IDBI Bank Limited and in his stead and place, Mr. Naresh Makhija was Nominated as the IDBI Nominee Director on the Board of the Company.

Moreover, with effect from 22.10.2011, the Nomination of Mr. Mihir Joshi had been withdrawn by GVFL Limited and ceased to be a GVFL Nominee Director on the Board of the Company. Further, Mr. Vithaldas D. talati had resigned and ceased to be a Director on the Board of the Company with effect from 22.10.2011.

The Board appreciated and took on records the assistance and guidance received by the Company during the tenure of the respective Directorships of Mr. Munish Mohan, Mr. Mihir Joshi and Mr. Vithaldas Talati.

Mr. Atul H. Patel and Mr. Pravinchandra M. Shah, retire by rotation and being eligible, offer themselves for reappointment.

RESPONSIBILITY STATEMENT:

Your Directors make following statements in terms of Section 217(2AA) of the Companies Act, 1956:

1. The applicable accounting standards have been followed in the preparation of the Annual Accounts along with proper explanations relating to material departures;

2. Accounting policies are selected and applied consistently and judgments and estimates are made which are reasonable and prudent so as to give a true and fair view of the state of the affairs as at the end of financial year and of the profit of the Company for the year under review;

3. The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. The Directors have prepared the accounts on a "going concern" basis.

AUDITORS

M/s. Manubhai & Co., Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. The Company has received a letter from Statutory Auditors to the effect that, in case their appointment is made, it would be within the specified limit under Section 224(1B) of the Companies Act, 1956.

ACKNOWLEDGEMENT

Your Directors would like to express their grateful appreciation for assistance & co-operation received from the Government Authorities; GVFL; Banks and Financial Institutions; Customers; Vendors; Investors; Depositors and all others.

Your Directors also wish to place on record deep sense of their appreciation for the valuable and committed services of the Executives, Staff & Workers of the Company.

For and on behalf of the Board of Directors

Place: Waghodia, Vadodara Chandresh S. Parikh

Date: 28.05.2012 Chairman and Managing Director

 
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