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Directors Report of Bajaj Steel Industries Ltd.

Mar 31, 2014

Dear Members,

The Directors are pleased to present the 53rd Annual Report and the Audited Accounts of the Company for the Financial Year ended 31st March, 2014. The New Companies Act, 2013 has been passed which replaced the Companies Act, 1956 and since this Report as to Financial year that commenced prior to 1st April, 2014, the contents therein are governed by the relevant provisions / schedules / rules of the Companies Act, 1956, in compliance with the General Circular No 08/2014 dated 4th April, 2014 issued by the Ministry of Corporate Affairs, Government of India, New Delhi.

The Highlights of the Financial performance for the year under review are as below:

FINANCIAL RESULTS : (In Rs.)

31.03.2014 31.03.2013

SALES AND OTHER INCOME 4,11,44,65,108 2,88,59,81,619

Profitbeforelnterest&Depreciation 34,79,76,297 17,89,69,137

Less: Interest 7,09,16,187 6,61,28,559

Depreciation 8,83,27,927 5,91,77,574

18.87,32,183 5,36,63,004

Add : Extra Ordinary Item

Profit Before Tax (-) (-)

18,87,32,183 5,36,63,004

Provision for Taxation :

Current Year : 6,54,93,000 1,69,19,866

Deferred Tax : 5,13,000 (58,61,000)

Tax for Earlier : - -

Year/ Adjustment :

6,60,06,000 1,10,58,866

Net Profit 12,27,26,183 4,26,04,138

Add : Balance Brought Forward from previous year

1,77,43,784 1,83,33,332

14,04,69,967 6,09,37,470

Less : Appropriations :

Proposed Dividend 94,00,000 70,50,000

Corporate Dividend Tax 15,97,530 11,43,686

Transfer to General Reserve 10,00,00,000 3,50,00,000 Balance Carried Forward to

Balance Sheet 2,94,72,437 1,77,43,784

14,04,69,967 6,09,37,470

DIVIDEND:

Your Directors are pleased to recommend the Equity Dividend @ 40% i.e. Rs. 4/- per share. The Dividend as recommended would involve an outflow of Rs. 94,00,000/- (Rupees Ninety Four Lacs only) towards Dividend and Rs. 15,97,530/- (Rupees Fifteen Lacs Ninety Seven Thousand Five Hundred and Thirty only) towards Corporate Dividend Tax, resulting in a total outflow of Rs. 1,09,97,530/- (Rupees One Crore Nine Lacs Ninety Seven Thousand Five Hundred and Thirty only). The dividend will be distributed to the members whose names appear on the register of members as on record date.

WORKING & FUTURE PROSPECTS :

During the year under review, the turnover of the Company increased gradually from Rs. 285.23 crores in 2012-13 to Rs. 406.94 Crores in 2013-14 representing a growth of 42.67%. The increase in turnover is attributable to the new developed products as well as to explore the new markets. The profitability of the Company has also been increased from Rs. 4.26 Crores in 2012-13 to Rs. 12.27 Crores in 2013-14.

The working of both the Divisions of the Company is given as below:

STEEL DIVISION :

The Steel Division is concentrating in its core business of manufacturing Cotton ginning and Pressing machineries which has a great potential to expand, considering the increasing cotton cultivation in India & abroad. The Company had successfully launched few new products like Cotton Delinting Machines and Decorticating Machines, Pre-fabricated Industrial Sheds etc.

PLASTIC DIVISION (SUPERPACK):

The sale/ disposal of the Superpack Division is expected to complete at the earliest. However, the performance of the unit has improved during the year achieving the Gross Turnover of Rs. 129.38 Crores in 2013-14 against Rs. 112.96 Crores during the Financial Year 2012-13.

Shri Vinod Kumar Bajaj and Shri Ashish Bajaj are looking after the Superpack Division of the Company. Looking at the valuable experience and background of Shri Ashish Bajaj, the Board of Directors has re-appointed Shri Ashish Bajaj for further period of One (1) year w.e.f. 20.03.2014, in compliance with Section 314(1B) of the Companies Act, 1956 read with Director''s Relative (Office or Place of Profit), Rules, 2011 subject to approval of the members at the ensuing AGM. Further, Shri Ashish Bajaj, Chief Executive Officer of Superpack Division of the Company is solely responsible & liable for all the operations (including Day to Day operations), activities and all the compliances including Statutory & Labour compliances applicable to the Superpack Division of the Company from time to time and necessary forms /papers in relation thereof shall be filed with the concerned authorities.

FOREIGN SUBSIDIARY :

During the year 2012-13, the Company had incorporated its 100% Foreign Subsidiary namely M/s BAJAJ CONEAGLE LLC, A Limited Liability Company having its office at Prattville, Alabama, USA. With the physical presence at USA, the Company is able to tap the US & International Market of Continental Products.

CREDIT RATING:

Your Directors are glad to inform that CRSIL has further reviewed and rated in respect of Bank facilities of the Company. The ratings are as under:

Total Bank Loan Facilities Rated Rs. 82.00 Crores

Long - Term Rating CRISILA/Stable (Reaffirmed)

Short-Term Rating CRISILA1 (Reaffirmed)

AUDITORS AND AUDITORS'' REPORT:

M/s B. Chhawchharia & Co., Chartered Accountants, Nagpur retires at the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The Company has received letters from all of them to the effect that their re-appointment, if made would be within the prescribed limits under Section 141 of the Companies Act, 2013 and that they are not disqualified for the re-appointment.

The observations made by the auditors read together with the relevant notes thereon, are self- explanatory and do not call any comments.

COST AUDITORS AND COST AUDIT REPORT :

M/s Rakesh Mishra & Co, Cost Accountants, was appointed as Cost Auditors of the Company to conduct the audit of cost Accounts maintained by the Company. The Company has received the Cost Audit Report dated 07.08.2014 from the Cost Auditor for the Financial Year 2013-14 and the same is being filed with the Ministry of Corporate Affairs in terms of the provisions of the Companies Act, 1956.

PUBLIC DEPOSITS :

The total public deposits as on 31st March, 2014 amounted to Rs. 2, 83,000/- (Rupees Two Lacs Eighty Three Thousand only) and the same has repaid in the current financial year. As on date, there is no deposit lying due, unpaid and unclaimed with the Company. The Company has also filed necessary returns with MCA.

INDUSTRIAL RELATIONS :

Industrial relations remained cordial during the year. Employees'' competencies and skills were enhanced by exposing them to several internal and external training programs. Various measures were taken to improve motivation level of employees.

DIRECTORS :

In view of the provisions of the Companies Act, 2013 (''Act'') Shri Vinod Kumar Bajaj (DIN 00519541) has now become retiring Director and retires from the Board by rotation this year and being eligible, offers himself for re-appointment. The information as required to be disclosed under Clause 49 of the Listing Agreement in case of re-appointment of Directors is provided in the Notice of the ensuing Annual General Meeting.

Pursuant to Section 149(4) of the said Act, every listed company is required to appoint at least one third of its Directors as Independent Directors. The Board already has more than half of its Directors in the category of Independent Directors in terms of the provisions of Clause 49 of the Listing Agreement. Further, as per Section 149(10) & (11) of the Act, an Independent Director shall hold office for a term upto five consecutive years on the Board and shall not hold office in the Company for more than two consecutive Terms of five years each. However, any tenure of existing independent Director on the date of commencement of the Act shall not be counted as a term under those sub-sections.

In view of the same, it becomes necessary to appoint & fix the term of existing Independent Directors of the Company in accordance with Section 149 of the Act and therefore, the Board, in its meeting held on 7th August, 2014 appointed existing Independent Directors under Clause 49 as ''Independent Directors'' pursuant to provisions of the said Act, subject to approval of shareholders. As required under the said Act and the rules made there under, the same is now put up for approval of the members at the ensuring AGM. Necessary details have been annexed to the notice of the Meeting in terms of Section 102 of the said Act. The Independent Directors have submitted the Declaration of Independence, as required under Section 149(6) of the Act, declaring that they meet the criteria of Independence.

Further, the Board has re-appointed Shri Rohit Bajaj as Chairman & Managing Director of the Company and Shri Sunil Bajaj as a Executive Directors at their meeting held on 29th May, 2014 for a period of five years with effect from 1st July, 2014 whose period of office were expiring on 30th June, 2014. The re-appointment shall be subject to approval of the members of the Company at ensuing AGM. The Board has recommended the re-appointment at the ensuing AGM.

CORPORATE GOVERNANCE :

Your Directors wish to inform you that your Company is committed to achieve the standards of Corporate Governance and continue to lay emphasis on the same. Disclosures required to made under the heading ''Corporate Governance'' Under Clause (IV)sub-Clause (E) of Clause 49 of the Listing agreement are made herein below:

i) The Company does not pay any remuneration to it''s Non-Executive Director. The elements of remuneration package payable to Shri Rohit Bajaj, Managing Director and Shri Sunil Bajaj, Executive Director are detailed out in the Corporate Governance Report which has been part of this Annual Report.

ii) Various components of remuneration payable to Shri Rohit Bajaj, Managing Director and Shri Sunil Bajaj, Executive Director are detailed out in the Corporate Governance Report which has been a part of this Annual Report.

iii) No stock options are offered by the Company.

A separate report on Corporate Governance is provided in this Annual Report together with a Certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under clause 49 of the Listing Agreement. A Certificate of the CEO/MD & CFO of the Company in terms of sub-clause (v) of Clause 49 of the Listing Agreement, interalia confirming the correctness of the financial Statements, adequacy of the internal control measures and reporting of matters to the Audit committee is also annexed. All Board members and Senior management personnel have affirmed compliance with the code of conduct for the year2013-14.

CORPORATE SOCIAL RESPONSIBILITY (CSR) COMMITTEE:

During the year under review, pursuant to Section 135 of the Companies Act, 2013 the Company has constituted the Corporate Social Responsibility (CSR) committee under the Chairmanship of Shri Deepak Batra, Chartered Accountant, an Independent Director of the Company and consisting of other Independent Directors viz. Shri Rajiv Ranka and Shri Alok Goenka.

AUDIT COMMITTEE:

The Audit committee of the Board is under Chairmanship of Shri Deepak Batra, Chartered Accountant, who is an independent Director of the Company and consisting of other independent Directors viz. Shri Rajiv Ranka and Shri Alok Goenka as a practice of good Corporate Governance.

COMMITTEES IN TERMS OF COMPANIES ACT 2013 & REVISED CLAUSE 49 - CORPORATE GOVERNANCE OF THE LISTING AGREEEMENT:

The Company has already constituted the Remuneration & Shareholder / Investor Grievance& Share Transfer Committee in terms of Clause 49 of the Listing Agreement. Pursuant to Section 178 of the Companies Act, 2013 and revised Clause 49 of the Listing Agreement, the Board at their Meeting held on 29th May, 2014, has re-designated & constituted the ''Nomination & Remuneration Committee'', Stakeholders Relationship Committee / Shareholder / Investors Grievance Committee and Share Transfer Committee in terms of Section 178 of the Act and Revised Clause 49 of the Listing Agreement.

With the re-designation/constitution of the Committees as stated above, the Company has all the committees in terms of Companies Act, 2013 and Revised Clause 49 of the Listing Agreement.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT :

A Management & Discussion Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement, is presented in a separate section forming part of the Annual Report

PARTICULARS OF EMPLOYEES :

As per Annexure attached with this Report.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION & PROTECTION FUND:

The Dividends declared by the Company which remain unpaid / unclaimed for a period of Seven (7) years are required to transferred to the Investor Education & Protection Fund (IEPF) established by the Central Government pursuant to Section 205C of the Companies Act, 1956. The Members are requested to claim their unpaid / unclaimed Dividend, if any, declares and paid for the financial years 2006-07, 2007-08, 2008-09, 2009-10, 2010-11, 2011-12 & 2012-13.

The Company has already transferred unpaid / unclaimed balance for the year 2005-06 to Investor Education & Protection Fund (IEPF) pursuant to Section 205C of the Companies Act, 1956. Further, the unpaid/unclaimed balance of year 2006-07 would be transferred to the Investor Education and Protection Fund Account in the current Financial Year by the Company.

CONSERVATION OF ENERGY :

The Company lays great emphasis on savings in the cost of energy consumption. Achieving reduction in the per unit consumption of energy is an ongoing exercise in the Company. Effective measures have been taken to minimize the loss of energy as far as possible. Further, the details of Rule 2(A)(d) of Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are not applicable to the Company.

TECHNOLOGY ABSORPTION :

The technological developments on Ginning & Pressing Machinery has acted as an driving force in structural shift from old outdated to more productive advance machinery. The technology used by the Company is updated as a continuous exercise. The Company recognizes that focused initiative on the development of new products would form the backbone of the Company''s future business performance and profitability. Keeping this in view, the Company has increased its efforts in terms of development of new products. At present, the Company is working on various products under the able leadership of Shri Sunil Bajaj, Executive Director. Research and Development is a continuous phenomenon in the Company and due to which the Company is able to launch successfully various new products to trap the market throughout the year.

LISTING OF SHARES :

The Equity Shares of the Company are listed on the Bombay Stock Exchange Ltd, Delhi Stock Exchange Limited and the Calcutta Stock Exchange Limited. The Company has paid annual listing fees of the Stock Exchanges for the financial year 2013- 2014. There are no trading of Company''s shares at Delhi Stock Exchange and the Calcutta Stock Exchange.

DIRECTORS RESPONSIBILITY STATEMENT :

As per provision of Section 217(2AA) of the Companies Act, 1956, the Directors confirm that :

a) In the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures and in compliance with the laws.

b) The accounting policies have been consistently applied and reasonable and prudent judgment and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2014 and the Profit and Loss Account of the Company for the period.

c) Proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 has been taken for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The Annual Accounts have been prepared on agoing concern basis.

ACKNOWLEDGEMENT :

The Directors are grateful to the Bankers and Financial Institutions for their continued support, co- operation and assistance during the year. The Directors express their thanks for the sincere and dedicated efforts put in by the workers, staff and officers during the year.

FOR AND ON BEHALF OF THE BOARD FOR BAJAJ STEEL INDUSTRIES LIMITED

DATED : 07.08.2014 ROHIT BAJAJ PLACE : NAGPUR CHAIRMAN & MANAGING DIRECTOR


Mar 31, 2012

The Directors of the Company are please to present their Fifty First Annual Report on the affairs of the Company together with the Audited Accounts for the year ended 31st March, 2012.

The Highlights of the Financial performance for the year under review are as below :

FINANCIAL RESULTS :

(In Rupees)

31.03.2012 31.03.2011

SALES AND OTHER 3,16,45,25,756 2,06,02,23,037

INCOME

Profit before Interest & 24,05,64,249 14,21,53,915 Depreciation

Less : Interest 6,92,73,631 5,89,74,317

Depreciation 6,54,58,923 5,72,95,421

10,58,31,695 2,58,87,177

Add : Extra Ordinary Item (-) (-)

Profit before Tax 10,58,31,695 2,58,87,177

Provision for Taxation :

Current Year : 4,16,06,000 1,27,16,593

Deferred Tax : (72,88,000) (20,30,000)

Tax for Earlier : - 1,06,23,894

year/Adjustment 3,43,18,000 2,13,10,487

Net Profit 7,15,13,695 45,76,690

Add : Balance Brought Forward from previous year 2,50,13,323 3,58,99,091

9.65.27.018 4,04,75,781

Less : Appropriations :

Proposed Dividend 70,50,000 47,00,000

Corporate Dividend Tax 11,43,686 7,62,458

Transfer to General Reserve 7,00,00,000 1,00,00,000

Balance Carried Forward to 1,83,33,332 2,50,13,323

Balance Sheet

9.65.27.018 4,04,75,781

DIVIDEND :

Your Directors are pleased to recommend a Equity Dividend of Rs 3/- per share. The Dividend as recommended would involve an outflow of Rs 70,50,000/- (Rupees Seventy Lacs Fifty Thousand only) towards Dividend and Rs 11,43,686/- (Rupees Eleven Lacs Forty Three Thousand Six Hundred and Eighty Six only) towards Corporate Dividend Tax, resulting in a total outflow of Rs 81,93,686/- (Rupees Eighty One Lacs Ninety Three Thousand Six Hundred and Eighty Six only). The dividend will be distributed to the members whose names appear on the register of members as on record date.

WORKING & FUTURE PROSPECTS :

During the year under review, the gross turnover of the Company increased gradually from Rs 206.02 crores in 2010 -11 to Rs 316.45 crores in 2011 -2012 representing a growth of 53.60 % .The increase in turnover is attributable to the new developed products as well as to the better explorements to new markets The profit after tax has also been increased from Rs 0.46 crores in 2010 - 11 to Rs 7.15 crores in 2011- 12. The profitability of the Company has increased due to the increase in turnover which has resulted in better allocation of Fixed Expenses

The working of both the division of the Company is given as below:

- STEEL DIVISION:

The Steel Division is concentrating in its core business of manufacturing Cotton ginning and Pressing machineries which has a great potential to expand, considering the increasing cotton cultivation in India & abroad. The Company had successfully launched few new products like Cotton Delinting Machines and Decorticating Machines, Pre- fabricated Industrial Sheds etc.

- PLASTIC DIVISION (SUPERPACK) :

The sale / disposal of the Superpack Division is expected to complete at the earliest . However the performance of the unit has improved during the year achieving the gross turnover of Rs 100.00 crores.

Shri Vinod Kumar Bajaj and Shri Ashish Bajaj are looking at the Superpack Division of the Company. Looking at the valuable experience and background of Shri Ashish Bajaj, the Board of Directors vide circular resolution further re-appointed Shri Ashish Bajaj for period of One (1) year w.e.f. 20.03.2012, in compliance with Section 314(1B) of the Companies Act, 1956 read with Director's Relative (Office or Place of Profit), Rules, 2011, subject to the approval of members /shareholders at the ensuing annual general meeting of the Company.

Further, Shri Ashish Bajaj Chief Executive Officer of Superpack Division of the Company is solely responsible for the operations (including Day to Day operations), activities and all the compliances including statutory compliances of Superpack Division of the Company

TECHNICAL COLLABORATIONS :

The Company has the following Technical Collaborations to manufacture the Cotton Processing Machines:

Sr No. Name of the Products Name of the Collaborators

1. Ginning & Pressing Machines Central Institute for Research on Cotton Technology (CIRCOT), ICAR, Govt of India, Mumbai

2. Humidification System Samuel Jackson Inc, USA

* During the Financial year 2011-12, the Company has took over the Business of Continental Eagle Corporation including keep all rights of Sales & marketing of Continental Eagle Corporation. Now, the Company will manufacture and sales all products of Continental Eagle Corp. on its own exclusively.

FOREIGN SUBSIDIARY :

The Company has already acquired the Business of Continental Eagle Corporation, USA.

To trap more markets for the products of Continental and own Products, the Company thought to form a 100% Subsidiary through which the Continental Products will be sold.

The Company complied with all the provisions of Title 10A of Code of Alabama, 1975 and fulfilled the necessary compliance's as required to form WOS in foreign state including compliance's of FEMA and RBI guidelines and has formed / incorporated its 100% subsidiary with the name and style as " BAJAJ CONEAGLE LLC"at the State of Alabama, USA on April 02,2012

AWARDS & RECOGNITION :

Your Directors are glad to inform you that, Shri Sunil Bajaj, Executive Director of the Company Bajaj has been awarded Honorary Fellowship of ISCI in appreciation of his outstanding contribution to Cotton Ginning & Pressing by the Hands of Hon'ble Justice Chandrashekhar Dharmadhikari on 14th June, 2011,

RATING AGAINST BANK FACILITIES :

Your Directors are glad to inform that CRISIL has further reviewed and rated in respect of Bank facilities of the Company. The ratings are as under :

Total Bank Loan Facilities Rated Rs 82.00 Crores

Long - Term Rating CRISIL A /Stable (Reaffirmed)

Short- Term Rating CRISIL A1 (Reassigned )

FORFIETURE OF SHARE WARRANTS :

During the year under review, the Company has forfeited the share application of Rs 99.00 Lacs of the below mentioned warrant holders.

Sr. No. Name of the Warrant Holders Amount (In Rs.)

1 Vidarbha Tradelinks Private Limited 66,00,000

2 Nissan Merchandise Private Limited 33,00,000

As warrant holders failed to exercise their conversion options and the Company didn't received the balance amount of 75% in respect of Balance 1,50,000 Share Warrants on or before 10th November, 2011, the Company forfeited the 25% amount paid by the respective allottees as share application money in terms of Regulation 75 and 77(4) of the SEBI (Issue of Capital and Disclosure Requirements) Regulations 2009.

AUDITORS' REPORT :

The observations made by the auditors read together with the relevant notes thereon, are self-explanatory.

PUBLIC DEPOSITS :

The total public deposits as on 31st March, 2012 amounted to Rs 22,19,000/- (Rupees Twenty Two Lacs Nineteen Thousand Only). Six deposits amounting to Rs 42,000/- (Rupees Forty Two Thousand only) though matured before 31st March, 2012 were not claimed by the depositors. As on date all the Six Unclaimed Deposits have been paid and no unclaimed deposits are lying with the Company

INDUSTRIAL RELATIONS :

Industrial relations remained cordial during the year. Employees' competencies and skills were enhanced by exposing them to several internal and external training programs. Various measures were taken to improve motivation level of employees.

DIRECTORS:

Shri Deepak Batra and Shri Kamal Kishore Kela retires by rotation and being eligible offers themselves for re-appointment.

Except above, there is no change in Board of Directors during the year under review.

CORPORATE GOVERNANCE REPORT :

A Certificate from the Statutory Auditors- M/s B.Chhawchharia & Co, Chartered Accountants, Nagpur; confirming compliance with conditions as stipulated under the aforesaid Clause 49 is annexed to the Report of Corporate Governance.

Disclosures required to made under the heading 'Corporate Governance' Under Clause (IV) (1) & (2) of the proviso under the table (B) of Sub-Section 1 of Section II of part II of Schedule XIII of the Companies Act, 1956, are made herein below :

(i) The Company does not pay any remuneration to its's Non-Executive Director. The elements of remuneration package payable to Shri Rohit Bajaj, Managing Director and Shri Sunil Bajaj, Executive Director are detailed out in the explanatory statement annexed to the notice calling the ensuing Annual General Meeting which has been made a part of this Annual Report & Corporate Governance Report.

(ii) Various components of remuneration payable to Shri Rohit Bajaj, Managing Director and Shri Sunil Bajaj, Executive Director are detailed out in the explanatory statement annexed to the notice calling the ensuing Annual General Meeting which has been made a part of this Annual Report & Corporate Governance Report.

(iii) No stock options are offered by the Company.

(iv) The Corporate Governance Report and Management Discussion Analysis Report are attached with this Annual Report under Clause 49 of the Listing Agreement.

AUDIT COMMITTEE :

The Audit committee of the Board is under Chairmanship of Shri Deepak Batra, Chartered Accountant, an Independent Director of the Company and consisting of other Independent Directors viz. Shri Rajiv Ranka and Shri Alok Goenka as a practice of good Corporate Governance.

NEW PRODUCTS LINE :

The Company is having distinguished manufacturing facilities in India for Cotton Ginning & Pressing Plants / Machineries. The facilities are equipped with state of art machines with latest technologies and managed by team of engineers. Moreover, the Company is in the process of executing various new projects for wider product range,value additions and to make its product more competitive.

- Delinting & Decorticating Machines (Capacity ranging from 100-800 TPD)

- Continental Products based on Continental Eagle Corp, USA Technology

The Company has also proposed to develop Oil Mill Machineries (Capacity ranging from 100-300 TPD).

The above products are logical extension to the existing product lines.

For the above said expansion cum diversification, the Company has already acquired the land admn 37000 Sq Mtrs in Butibori Industrial Area, Nagpur. The Company has the distinct logistics advantages being a central place well connected by rail, road and air. Inland Container Depot and proposed International Cargo Hub is also very nearby.

During the Financial year 2011- 12 the Company has sold one Delinting Machine (200 TPD cotton delinting) to its customers and it was successfully commissioned.

PARTICULARS OF EMPLOYEES U/s 217 (2A) :

As per Annexure attached with the Directors Report .

RESEARCH AND DEVELOPMENT :

The Company recognizes that focused initiative on the development of new products would form the backbone of the Company's future business performance and profitability. Keeping this in view, the Company has increased its efforts in terms of development of new products in the Company's in House Research and Development Center. At present, the Company is working on various products under the able leadership of Shri Sunil Bajaj , Executive Director .

Research and Development is a continuous phenomenon in the Company and due to which the Company is able to launch successfully various new products like Auto Feeder,Overhead Distribution Conveyor Raw Cotton Feeding System Cotton Delinting Machines and Decorticating Machines, Pre- fabricated Industrial Shed etc.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION & PROTECTION FUND:

The Dividends declared by the Company which remain unpaid / unclaimed for a period of Seven (7) years are required to transferred to the Investor Education & Protection Fund ( IEPF) established by the Central Government pursuant to Section 205C of the Companies Act, 1956. The Members are requested to claim their unpaid / unclaimed Dividend , if any, declares and paid for the financial years 2005-06, 2006 - 07, 2007- 08, 2008- 09 , 2009 -10 & 2010 -11

However, the unpaid/unclaimed balance of year 2004 - 05 would be transferred to the Investor Education and Protection Fund Account by the Company.

CONSERVATION OF ENERGY :

The Company lays great emphasis on savings in the cost of energy consumption. Achieving reduction in the per unit consumption of energy is an ongoing exercise in the Company. Effective measures have been taken to minimize the loss of energy as far as possible.

TECHNOLOGY ABSORPTION, :.

The technological developments on Ginning & Pressing Machinery has acted as an driving force in structural shift from old outdated to more productive advance machinery. The technology used by the Company is updated as a continuous exercise.

FOREIGN EXCHANGE EARNINGS AND OUTGO :

Details of foreign exchange earnings through exports and foreign exchange outgo on account of imports, expenditure on Traveling and other matters etc. are shown in the Notes No. 12(b), 12(c ) and 12(d) respectively of Notes on Accounts. To avoid repetition, the members are requested to refer to these Notes.

LISTING OF SHARES :

The Equity Shares of the Company are listed on the Bombay Stock Exchange Ltd, The Delhi Stock Exchange Limited and The Calcutta Stock Exchange Limited.

The Company has paid annual listing fees of the Stock Exchange for the financial year 2011- 2012. There are no trading of Company's shares at The Delhi Stock Exchange and The Calcutta Stock Exchange.

DIRECTORS RESPONSIBILITY STATEMENT:

As per provision of Section 217(2AA) of the Companies Act, 1956, the Directors confirm that :

a. In the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.

b. The accounting policies have been consistently applied and reasonable and prudent judgment and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2012 and the Profit and Loss Account of the Company for the period.

c. Proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 has been taken for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d. The annual accounts have been prepared on a going concern basis.

AUDITORS :

M/s B. Chhawchharia & Co., Chartered Accountants, Nagpur retires at the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The Company had received the Peer Review Certificate from M/s B.Chhawchharia & Co, issued by the Institute of Chartered Accountants of India(ICAI), as it is mandatory for the statutory auditors to hold peer review certificate for carrying out audit of the listed companies.

APPOINTMENT OF COST AUDITOR :

The Ministry of Corporate Affairs (MCA) vide its circular dated 2nd May , 2011 mandated all the Listed Companies to get its cost accounting records audited by the Cost Auditor who shall be the Cost Accountant, holding valid certificate of practice under the provisions of Cost & Works Accountant Act, 1959.

In this context the Company has appointed M/s Rakesh Misra & Co, Kanpur, Cost Accounts, for undertaking cost compliance for the Financial Year 2011- 12. The Cost Compliance report is attached herewith.

ACKNOWLEDGEMENT :

The Directors are grateful to the Bankers and Financial Institutions for their continued support, co-operation and assistance during the year.

The Directors express their thanks for the sincere and dedicated efforts put in by the workers, staff and officers during the year.

FOR AND ON BEHALF OF THE BOARD

PLACE : NAGPUR HARGOVIND BAJAJ

DATED : 13.08.2012 CHAIRMAN


Mar 31, 2010

The Directors presents their Forty-Ninth Annual Report on the affairs of the Company together with the Audited Accounts for the year ended 31 th March, 2010:





FINANCIAL RESULTS : RUPEES

31.03.2010 31.03.2009

SALES AND OTHER INCOME 2,282,240,338 2,616,613,376

Profit before Interest & Depreciation 259,966,140 321,271,215

Less : Interest 55,999,830 44,729,064

Depreciation 51,392,407 43.138,545

152,573,903 233,403,606

Add : Extra Ordinary Item (-) (-)

Profit before Tax 152,573,903 233,403,606

Provision for Taxation 50,131,000 82,225,500

Net Profit 102,442,903 151,148,606 Add : Balance Brought Forward

from previous year 18,586,973 12,586,147

121,029,876 163,734,753 Less : Appropr ations :

Proposed Dividend 4,400,000 4,400,000

Corporate Dividend Tax 730,785 747,780

Transfer to General Reserve 80,000,000 140.000,000

Balance Carried Forward to Balance Sheet 35,899,091 18,586,973

121,029,876 163,734,753



DIVIDEND :

Your Directors are pleased to recommend a Equity Dividend of Rs. 2.00/- per share. The Dividend as recommended would involve an outflow of Rs. 44.00 Lacs towards Dividend and Rs. 7.31 Lacs towards corporate dividend tax, resulting in a total outflow of Rs. 51.31 Lacs. The dividend will be distributed to the members whose names appears on the register of members as on record date.

WORKING & FUTURE PROSPECTS :

The Companys Performance was effected due to a very long dry spell in the country. During the year under review, the turnover of the Company has been gradually decreased from Rs, 261.66 crores in the year 2008-09 to Rs. 228.22 crores in the year 2009-10 representing a fall of 12.78% The profitability of the Company has also been affected as the profit of the Company has decreased from Rs. 15.11 crores for the year 2008-09 to Rs.10.24 crores in 2009-10. The Board of Directors are trying their best to improve the performance of the Company. The working of both the division of the Company is given below:

- STEEL DIVISION:

The steel division is concentrating in its core business of manufacturing Cotton ginning ynrf Pressing machines which has a great potential to expand, considering the increasing cotton cultivation in India & abroad The company is also exploring addition of Newer machine and developing new technologies in coming days.

- PLASTIC DIVISION (SUPERPACK) :

The Sale / Disposal of Superpack Division has been approved by the Shareholders of the company on 10lh July, 2009 and authorised the Board of Directors to dispose off the Division at such price as it may deem fit.

Pursuant to the approval, the sale / disposal of the Superpack Division is under process and expected to complete during the current financial year.

PREFRENTIAL ALLOTMENT :

The Company is in the process of expanding its business activities by way of expansion plans. In view of the need of Long term working capital to cater the need of the consistent expansion plans undertaken by the Company, the company has issued and allotted 3,00,000 Lacs Share Warrants on 11" May, 2010 to meet the funds requirement. The Company has passed the special resolution Under Section 81(1A) of the Companies Act, 1956 and pursuant to SEBI Regulations vide Extra-ordinary general Meeting held on 30 th April, 2010. The Company has received 25% application money towards share warrants amounting to Rs 1.98 Crores. The aforesaid share warrants will be convertible into equity share on exercise of conversion option by the allottees within the period of 18 months from the dale of allotment and balance payment thereof.

RATING AGAINST THE BANKING FACILITIES :

Your Directors are glad to inform you that the Company has been rated with A+(Adequate safety- stable} by CRISIL in respect of Bank borrowings.

AUDITORS REPORT:

The observations made by the auditors read together with the relevant notes thereon, are self - explanatory.

PUBLIC DEPOSITS :

The total public deposits as on 31th March, 2010 amounted to Rs 10,882,000/-. Two deposits amounting to Rs. 15,000/-though matured before 31st March, 2010 were not claimed bythe depositors. As on date all the two unclaimed deposits have been paid. On or after 15th September, 2009 the Company has decided not to accept public deposits unless otherwise further decided by the Company.

INDUSTRIAL RELATIONS :

Industrial relations remained cordial during the year. Employees competencies and skills were enhanced by exposing them to several internal and external training programs. Various measures were taken to improve motivation level of employees.

DIRECTORS :

Shri Alok Goenka and Shri Rajiv Ranka retires by rotation and being eligible offers themselves for re-appointment.

Shri Ashish Bajaj was the whole Time Director (WTD) of the company for Superpack division and his term of office as WTD expired on 29.10,2009. Subsequently company has requested him to look after Superpack Division till its final disposal / sale of the same. Thereafter, Shri Ashish Bajaj was appointed as a Chief Executive Officer (CEO) of Superpack Division, for the period of two years w.e.f. 20.03.2010 which was recommended by the Selection Committee fo the Board subject to the approval of Shareholders of the Company and Central Government. The Company obtained the approval of the Shareholders with requisite majority through postal ballot process as declared by the Scrutinizer in his report on 1st April, 2010 The company has filed the requisite forms for taking Central Government approval and the same is awaited During the year, Shri Deepak Batra was appointed as an Additional Director (Independent-Non executive) of the Company on 3" March, 2010 and further reappointed on TV" May, 2010. In terms of Section 260 of the Companies Act, 1956, the term of Shri DeepaK Balanas an Additional Director of the Company expires at the ensuing Annual General Meeting. The resolution for his appointment as an Independent Directors have been included in the notice for approval of the members, Further, Smt Ramadevi Ruia has resigned from the Board of Directors of the Company with effect from 29.07.2010. She has resigned due to the old age and health problems. The Board has accepted her resignation and relieved her at its Board Meeting held on 29.07.2010. The Board of Directors extends their sincere appreciation to Smt Ramadevi Ruia for her contribution to the Company. The Board of Directors also wish for her good health and long life.

CORPORATE GOVERNANCE REPORT :

Your Directors are pleased to report that the Clause-49(Corporate Governance) is applicable to the Company during the year 2009 -2010 in view of net worth of the Company crossed the limit of Rs 25 crores. Accordingly , the Company had taken steps for appointment of Independent Directors on the Board of the Company and also constituted the Audit Committee, Remuneration Committee and Investor Grievance/ Share Transfer Committee.

A certificate from the Statutory Auditors- M/s B.Chhawchharia & Co, Chartered Accountants, Nagpur; confirming compliance with conditions as stipulated under the aforesaid Clause 49 is annexed to the Report of Corporate Governance.

AUDIT COMMITTEE:

As the Clause 49 (Corporate Governance) is applicable to the Company during the year 2009-2010, the Company constituted the audit committee of the board under Chairmanship of Shri Deepak Batra, Chartered Accountant consisting of Independent members Shri Rajiv Ranka and Shri Alok Goenka as a practice of good Corporate Governance.

PROJECTS:

The Company is having distinguished manufacturing facilities in India for Cotton Ginning & Pressing Plants/Machineries. The facilities are equipped with state of art machines with latest technologiesand managed by team of engineers. Moreover, the Company is in the process of expanding its business activities by way of expansion plans. The Company has acquired land admeasuring 38757,50 sq. meters at Plot No. G-108 atButibori Industrial Area, Nagpur, where the Company is planning to manufacture new machineries like Cotton Seed Delinting Machines/Decorticating Machines, Oil Mill Machineries, Steel Structure Buildings and Electrical Intelligent Panels for increased volume.

DIRECTORS RESPONSIBILITY STATEMENT:

As per provision of Section 217(2AAj of the Companies Act, 1956, the Directors confirm thai:

a. In the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.

b. The accounting policies have been consistently applied and reasonable and prudent judgement and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2010 and the Profit and Loss Account of the Company for the period.

c. Proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, f 956 has been taken for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d. The annual accounts have been prepared on a going concern basis.

AUDITORS :

M/s B. Chhawchharia & Co., Chartered Accountants, Nagpur retires at the conclusion of the ensuing Annual

General Meeting and are eligible for re-appointment,

ACKNOWLEDGEMENT:

The Directors are grateful to the Bankers and Financial Institutions for their continued support, co-operation and assistance during the year,

Tne Directors express their thanks for the sincere and dedicated efforts put in by the workers, staff and officers during the year.



FOR AND ON BEHALF OF THE BOARD

HARGOVIND BAJAJ

PLACE : NAGPUR CHARMAN Dated : 29.07.2010

 
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