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Directors Report of Bemco Hydraulics Ltd.

Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting the 56th ANNUAL REPORT together with the Audited Accounts of the Company for the year-ended 31st March 2014.

FINANCIAL RESULTS:

The Financial results for the year under review in comparison with the previous year are given below:

2013-2014 2012-2013 Rs. Rs.

1 Gross Profit/(Loss) for the year after meeting all operating expenses but before interest and depreciation amounts to: (1,77,34,229) 4,66,50,616

2 Deduction there from: Interest 3,93,10,119 3,04,12,042

3 Profit before depreciation (5,70,44,348) 1,62,38,574

4 Depreciation for the year 1,20,44,807 61,73,918

5 Profit before Taxation - (PBT) (6,90,89,155) 1,00,64,656

6 Provision for Taxation - (21,10,750)

7 Deferred Tax 2,14,97,000 (15,36,000)

8 Profit after Taxation - (PAT) (4,75,92,155) 64,17,906

9 Income tax Earlier Years (72,910) (8,08,629)

10 Net Profit (4,76,65,065) 56,09,277

11 Surplus brought forward 1,04,52,185 1,01,92,783

12 Profit Available for Appropriation (3,72,12,880) 1,58,02,060

13 Transferred to general Reserve - 10,00,000

14 Transferred to Capital redemption Reserve - -

15 Provision of Dividend on Preference Shares - 37,18,000

16 Provision for Income Tax on Dividend - 6,31,874

17 Balance carried to Balance Sheet (3,72,12,880) 1,04,52,186

DIVIDEND:

On Equity:

ON account of loss sustained during the year, the Board regrets its inability to recommend any dividend on equity shares.

On Preference Shares:

Considering the loss for the year under report, the Company proposes not to pay dividend, amounting to Rs. 37,18,000/-, on 3,38,000 Nos of Cumulative Redeemable Preference Shares @11% for the year-ending on 31st March 2014. This contingent liability has been carried forward, which has to be discharged against future profits.

CHANGE IN CAPITAL:

Equity:

During the year under report, your company has raised the equity share capital to the tune of Rs. 34,00,000/ - by issuing 3,40,000 Equity Shares, having face value of Rs. 10/- each @ the price of Rs. 60/- each to the Promoters and other than Promoters, on Preferential Basis. Thus the equity Capital has been increased by Rs. 34,00,000/- and Security Premium has been increased by Rs. 1,70,00,000/-

Preference Shares:

In terms of the issue 18,000/- Redeemable, Cumulative preference Shares which were due on 31st March 2014 have been redeemed from out of the proceeds of fresh issue.

OPERATING RESULTS AND PROFITS:

The estimated Gross revenue, during year under report has been hit by not only by Indian recessionary trend but also by downward trend in Global Economy.

The company''s status in this respect is as under:

* The net Revenue Income during year under review has been decreased by 16.87%

* Gross loss during the year under review is Rs. 177.34 Lakhs as against the Gross profit of Rs. 466.51 Lakhs during the previous year ended on 31st March 2013.

* The Loss for the year 2013-14 contains a Big Impact of:

1. Rs. 108.04 Lakhs on account of Currency Fluctuation on the payables of Foreign Currency to the foreign collaborators, which is not the actual loss but it is notional loss and are required to be accounted for, as per the Indian Accounting Standards.

2. Rs. 36.03 Lakhs on account of Provision for the receivables more than three years which are actually not the bad debts, but, again those are accounted for, as per the Indian Accounting Standards.

* However, looking at future growth, the company has extended the production facilities by investing in additional factory shed, plant and machinery.

FUTURE PROSPECTS:

Your company is in continual process of changing over of product-mix by using the advanced technology & adding some critical components in the product list of the company.

At present your Company has already executed the orders worth Rs. 1287.46 Lakhs till date and the orders worth Rs. 1966.24 Lakhs are in hand to execute in the current year. In addition to this, orders worth Rs. 1591.93 Lakhs are in pipelines. Further healthy enquiries are being received regularly, and the management feels that most of them will be converted into firm orders. However, company is setting the sales target, for 2014-15, of Rs. 3720/- Lakhs on conservative basis.

To sum up, the outlook for the next year looks bright.

DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to Section 217(2AA) of the Companies Act, 1956 (THE Act) the Directors, based on the representation received from the Operating Management, confirm that:

(i) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures from the same.

(ii) They have, in the selection of the accounting policies, consulted the Statutory Auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year and of the loss of the company for that period.

(iii) They have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) They have prepared annual accounts of the Company on a ''Going Concern'' basis.

CHANGE IN EXECUTIVE DIRECTORS

Tenure of Mr. Anirudh Mohta as Joint Managing Director of the Company expired on 31st March 2014 and he has been appointed as the Managing Director, in the Board Meeting held on 1st April 2014.

Mr. M. M. Mohta - Chairman and Managing Director of the Company whose tenure too expired on 31st March 2014 and was reappointed as executive Director in the Board meeting held on 1st April 2014. However, he expressed his unwillingness to continue as Executive Director and resigned from his post. Considering his request, Board has appointed him as Non Executive Chairman of the Company In view of resignation of Mr. M. M. Mohta from his executive post, the Board has revised the remuneration package of Mr. Anirudh Mohta with effect from 1st August 2014 in Board meeting held on 8th August 2014.

APPOINTMENT OF KMPS:

Board has appointed Mr. Anirudh Mohta -Managing Director and Mr. R. B. Patil - CFO of the Company as Key Managerial Persons (KMP) in pursuance of provisions under Section 203 of the Companies Act 2013. The Company has already initiated steps to appoint a whole time Company Secretary in terms of section 203 of the Companies Act, 2013.

SECRETARIAL COMPLIANCE REPORT:

Pursuant to Section 383A (1) of the Companies Act, 1956 secretarial compliance Certificate from a practicing Company Secretary is attached hereto for the year ended 31st March 2014.

PARTICULARS OF EMPLOYEES:

Information in accordance with the provisions of section 217 (2A) of the Companies Act 1956, read with the Companies (Particular of the Employees Rules) 1975 as amended, regarding particulars of employees is not applicable as none of the employees of the Company is given remuneration in the scale specified by that section

PUBLIC DEPOSITS: U/S 58A of the Companies Act, 1956:

There is no Fixed Deposit liability as on 31st March 2014, further, the Board declares that during the financial year 2013-14, the Company has not accepted any public deposits or unsecured loans falling within the purview of section 58A of the Companies Act, 1956.

RETIRING DIRECTORS BY ROTATION:

Smt. U. D. Mohta and Mr. N. K. Daga retire by rotation and are eligible for re-appointment. Nonetheless, taking note of the provisions of section 149 of the Companies Act, 2013 governing independent Directors, the Board has proposed appointments of all three existing non executive independent Directors as such as they are eligible to be so appointed.

AUDITOR & AUDIT REPORT:

M/S A. C. Bhuteria & Co., Chartered Accountants, Kolkata statutory Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. The Auditors have confirmed their eligibility and willingness to accept the audit assignment, if re-appointed.

The Auditors have at clause XI in annexure to their report pointed out delay in repayment of dues to bank and financial institution, the board would like to stress the fact that on account of non recovery of timely dues from the company''s customers, small delay occurred in repayment of bank dues this is temporary aberration and the account is now regular. The Bankers have confirmed that this does not constitute default under banking norms.

The Auditors Report is attached which is self explanatory.

COST AUDITOR & COST AUDIT REPORT:

The company has appointed Mr. UMESH NARASIMHA KINI, Cost Accountant, for conducting Cost Audit for the F.Y. 2013-14. The due date for filing of the Cost report is 30th September 2014. The report is under preparation.

PERSONNEL:

The industrial relations during the year remained extremely harmonious. The Directors wish to place on record their appreciation of the hard work and continuous efforts as well as valuable support rendered by the employees at all levels under review.

HEALTH AND SAFETY OF THE EMPLOYEE:

Health and safety of the employee has always been prime concern of the company and company has a medical officer to have routine checkup on the health of the employees.

B. Technology absorption:

e. Efforts made in technology absorption. As per Form B given below

Form B

Research and development (R & D)

1. Specific areas in which R & D carried out NIL by the company

2. Benefits derived as a result of the above R NIL & D

3. Future plan of action NIL

4. Expenditure on R & D

a. Capital NIL

b. Recurring NIL

c. Total NIL

d. Total R & D expenditure as per NIL

percentage of total turnover

Technology absorption, adaptation and innovation

1. Efforts, in brief, made towards technology Nil absorption, adaptation and innovation

2. Benefits derived as a result of the above Nil. efforts, e.g. product improvement, cost reduction, product development, import substitution etc.

3. In case of imported technology (imported Nil during the last five years reckoned from the beginning of the financial year), following information may be furnished:

a. Technology imported.

b. Year of import.

c. Has technology been fully absorbed?

d. If not fully absorbed, areas where this has not taken place, reasons Not Applicable therefore and future plans of action

CORPORATE GOVERNANCE:

As per Clause 49 of the Listing Agreement with the Stock Exchanges, a separate Chapter on Corporate Governance practices followed by the Company together with a Certificate from the Practicing Company Secretary confirming compliance forms part of this Report.

APPOINTMENT OF COMMON AGENCY FOR SHARE REGISTRY WORK

The Company has appointed M/S Adroit Corporate Services Private Limited, Mumbai to handle all the work related to Share Registry in terms of both Physical and Electronic mode, w.e.f. 1st February 2003, in pursuance with the Circular No. 15 dated December 27, 2002 issued by the Securities and Exchange Board of India.

DISCLOSURE AS PER LISTING AGREEMENT

The equity share of the company is listed on The Bombay Stock Exchange, and the company has paid the listing fees for the year 2013-2014. During the year there was no suspension in trading of the securities of the Company.

DISCLOSURE PURSUANT TO SECTION 22 OF SEXUAL HARASSMENT OF WOMAN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal) Act, 2013 is notified w.e.f. 22nd April 2013 and requires every employer to comply with its provisions and make a disclosure of the number of cases occurring under the Act. Your Company has already constituted an internal committee and as on date there were no complaints received as shall be apparent from the table of complaints mentioned below.

Sr. No of cases filed under the Act No of disposal under the Act No. before the internal committee

1 nil nil

ACKNOWLEDGEMENT:

The Directors wish to convey their appreciation to all of the Company''s Employees for their enormous personal efforts as well as their collective contribution to the Company''s performance. The Directors would also like to thank the shareholders, customers, suppliers, bankers, Government and all other business associates for their continuous support given by them to the Company and their confidence in management.

For and on behalf of the Board

M. M. MOHTA ANIRUDH MOHTA Chairman Managing Director DIN-00068884 DIN-00065302 2 Mohanam, 10th Cross, 2 Mohanam, 10th Cross, Bhagya Nagar, Bhagya Nagar, Belgaum, 590006, Belgaum, 590006, Karnataka, Karnataka, Place : BELGAUM Dated : 08th August 2014


Mar 31, 2013

To Dear Shareholders,

The Directors have pleasure in presenting the 55th ANNUAL REPORT together with the Audited Accounts of the Company for the year-ended 31st March 2013.

FINANCIAL RESULTS:

The Financial results for the year under review in comparison with the previous year are given below:

2012-2013 2011-2012 Rs. Rs.

1 Gross Profit for the year after meeting all operating expenses but before interest and depreciation amounts to: 4,66,50,616 3,64,95,496

2 Deduction there from: Interest 3,04,12,042 2,07,80,657

3 Profit before depreciation 1,62,38,574 1,57,14,839

4 Depreciation for the year 61,73,918 88,38,333

5 Profit before Taxation - (PBT) 1,00,64,656 68,76,506

6 Provision for Taxation (21,10,750) (41,18,400)

7 Deferred Tax (15,36,000) 14,94,000

8 Profit after Taxation - (PAT) 64,17,906 42,52,106

9 Income tax Earlier Years (8,08,629) (1,88,402)

10 Net Profit 56,09,277 40,63,704

11 Surplus brought forward 1,01,92,783 1,18,33,325

12 Profit Available for Appropriation 1,58,02,060 1,58,97,029

13 Transferred to general Reserve 10,00,000 10,00,000

14 Transferred to Capital redemption Reserve - 14,73,200

15 Provision of Dividend on Preference Shares 37,18,000 27,80,052

16 Provision for Income Tax on Dividend 6,31,874 4,50,994

17 Balance carried to Balance Sheet 1,04,52,186 1,01,92,783

DIVIDEND:

On Equity:

Taking in to account the huge fund requirement for the large number of orders on hand, and to conserve the resources, the Directors do not recommend any dividend on equity shares.

On Preference Shares:

In terms of issue, the Company proposes to pay dividend on 3,38,000 Preference Shares @11% for the year-ending on 31st March 2013, absorbing a sum of Rs. 37,18,000.

The total cash outflow because of Dividend and Tax thereon amounts to Rs. 43.50 Lakhs.

REVIEW OF OPERATION:

Since recent past few years, the Company has seen upward trend of business and the same has been maintained during year under report.

The company''s status in this respect is as under:

- The net Revenue Income during year under review increased by 53.53%

- Gross profit during the year under review is Rs. 466.51 Lakhs as against the Gross profit of Rs. 364.95 Lakhs during the previous year which is 27.83 % higher than the previous year

- Profit after tax (PAT) increased by 50.93 % from Rs. 42.52 Lakhs in 2011-2012 to Rs. 64.18 Lakhs in 2012-2013.

- Company could discharge the liability of Dividend on Preference shares & tax thereon to the tune of Rs. 43.50 Lakhs for the year under report i.e. for the year ending on 31st March 2013.

- Also company has extended the production facilities by investing in additional factory shed and plant & machinery.

FUTURE PROSPECTS:

Your company is in continual process of changing over of product-mix by using the advanced technology & adding some critical components in the product list of the company.

At present your Company has already executed the orders worth Rs. 305.24 Lakhs till date and the orders worth Rs. 3378.54 Lakhs are in hand to execute in the current year. In addition to this, orders worth Rs. 2580. 90 Lakhs are in pipelines. Further healthy enquiries are being received regularly, and the management feels that most of them will be converted into firm orders. However, company is setting the sales target, for 2013-14, of Rs. 4500/- Lakhs on conservative basis.

Company is studying the possibilities of adding the line of Mechanical Presses in its product mix which may help to grow its sales turnover.

To sum up, the outlook for the next year looks bright.

DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to Section 217(2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility Statement, it is hereby confirmed that:

(i) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to 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 true and fair view of the state of affairs of the Company as at 31st March 2013.

(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; and

(iv) The Directors have prepared annual accounts of the Company on a ''Going Concern'' basis.

SECRETARIAL COMPLIANCE REPORT:

Pursuant to Section 383A (1) of the Companies Act, 1956 secretarial compliance Certificate from a practicing Company Secretary is attached hereto.

PARTICULARS OF EMPLOYEES:

Information in accordance with the provisions of section 217 (2A) of the Companies Act 1956, read with the Companies (Particular of the Employees Rules) 1975 as amended, regarding particulars of employees is not applicable as none of the employees of the Company is given remuneration in the scale specified by that section

PUBLIC DEPOSITS: U/S 58A of the Companies Act, 1956:

There is no Fixed Deposit liability as on 31st March 2013, further, the Board declares that during the financial year 2012-13, the Company has not accepted any public deposits or unsecured loans falling within the purview of section 58A of the Companies Act, 1956.

RETIRING DIRECTORS BY ROTATION:

Mr. R. M. Shah and Dilip Chandak, retire by rotation and are eligible for re-appointment.

AUDITOR & AUDIT REPORT:

M/S A. C. Bhuteria & Co., Chartered Accountants, Kolkata statutory Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. The Auditors have confirmed their eligibility and willingness to accept the audit assignment, if re-appointed.

The Auditors have at clause XI in annexure to their report pointed out defaults in repayment of dues to bank and financial institution, the board would like to stress the fact that on account of non recovery of timely dues from the company''s customers, small delay occurred in repayment of bank dues this is temporary aberration and the account is now regular.

The Auditors Report is attached which is self explanatory.

COST AUDITOR & COST AUDIT REPORT:

The company has appointed Mr. Umesh Narasimha Kini, Cost Accountant, for conducting Cost Audit for the F. Y. 2012-13 The due date for filing of the Cost report is 27th September 2013. The report is under Preparation.

PERSONNEL:

The industrial relations during the year remained extremely harmonious. The Directors wish to place on record their appreciation of the hard work and continuous efforts as well as valuable support rendered by the employees at all levels under review.

HEALTH AND SAFETY OF THE EMPLOYEE:

Health and safety of the employee has always been prime concern of the company and company has a medical officer to have routine checkup on the health of the employees.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

A. CONSERVATION OF ENERGY:

a. Energy conservation measures taken The present manufacturing process employed is not energy intensive and hence, there is limited scope for conservation of energy. However, efforts are being made to keep the consumption of power and fuel at minimum.

b. Additional investments and proposals, if any, being implemented for reduction of consumption of energy;

NIL

c. Impact of measures at (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods;

NIL

d. Total energy consumption and energy consumption per unit of production as per Form A.

No statement in Form A pursuant to Companies (Disclosure of Particulars in the Report of the Board) 1988 is annexed as the company is not engaged in the activity specified in the schedule A to the said Rules.

B. Technology absorption:

e. Efforts made in technology absorption. As per Form B given below

Form B

Research and development (R & D)

1. Specific areas in which R & D carried out by the company NIL

2. Benefits derived as a result of the above R & D NIL

3. Future plan of action NIL

4. Expenditure on R & D

a. Capital NIL

b. Recurring NIL

c. Total NIL

d. Total R & D expenditure as per Percentage of total turnover NIL

Technology absorption, adaptation and innovation

1. Efforts, in brief, made towards technology adsorption,, adaptation and innovation

Nil

2. Benefits derived as a result of the above efforts, e.g. product improvement, cost reduction, product development, import substitution etc.

Nil.

3. In case of imported technology (imported during the last five years reckoned from the beginning of the financial year), following information may be furnished:

a. Technology imported.

b. Year of import.

c. Has technology been fully absorbed?

d. If not fully absorbed, areas where this has not taken place, reasons therefore and future plans of action

Not Applicable

CORPORATE GOVERNANCE:

As per Clause 49 of the Listing Agreement with the Stock Exchanges, a separate Chapter on Corporate Governance practices followed by the Company together with a Certificate from the Practicing Company Secretary confirming compliance forms part of this Report.

APPOINTMENT OF COMMON AGENCY FOR SHARE REGISTRY WORK

The Company has appointed M/S Adroit Corporate Services Private Limited, Mumbai to handle all the work related to Share Registry in terms of both Physical and Electronic mode, w. e. f. 1st February 2003, in pursuance with the Circular No. 15 dated December 27, 2002 issued by the Securities and Exchange Board of India.

DISCLOSURE AS PER LISTING AGREEMENT

The equity share of the company is listed on The Bombay Stock Exchange, and the company has paid the listing fees for the year 2013-2014. During the year there was no suspension in trading of the securities of the Company.

DISCLOSURE PURSUANT TO SECTION 22 OF SEXUAL HARASSMENT OF WOMAN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal) Act, 2013 is notified w. e. f. 22nd April 2013 and requires every employer to comply with its provisions and make a disclosure of the number of cases occurring under the Act. Your Company has already constituted a internal committee and as on date there were no complaints received as shall be apparent from the table of complaints mentioned below.

Sr. No of cases filed under the Act before the internal No of disposal under the No. committee Act

1 NIL NIL

ACKNOWLEDGEMENT:

Your Directors wish to place on record their appreciation of the services rendered by the employees during the year.

Your Directors also place on record their sincere appreciation for the assistance and co-operation received from Financial Institutions, Bankers and other Institutions, Government Authorities, vendors, customers and members during the year under review. Your Directors wish to place on record their appreciation for the committed services of the executives, staff and workers of the Company.

For and on behalf of the Board of Directors

Place: BELGAUM M. M. MOHTA ANIRUDH MOHTA

Date: 28.05.2013 Chairman & Managing Director Joint Managing Director


Mar 31, 2012

The Directors have pleasure in presenting the 54th ANNUAL REPORT together with the Audited Accounts of the Company for the year-ended 31st MARCH 2012.

FINANCIAL RESULTS:

The Financial results for the year under review in comparison with the previous year are given below:

2011-2012 2010-2011 Rs. Rs.

1 Gross Profit for the year after meeting all operating expenses but before interest and depreciation amounts to: 35,238,568 35,142,342

2 Deduction there from: Interest 19,523,729 17,284,157

3 Profit before depreciation 15,714,839 17,858,186

4 Depreciation for the year 8,838,333 10,028,070

5 Profit before Taxation - (PBT) 6,876,506 7,830,116

6 Provision for Taxation (4,118,400) (4,012,000)

7 Deferred Tax 1,494,000 929,000

8 Profit after Taxation - (PAT) 4,252,106 4,747,116

9 Income tax Earlier Years (188,402) (554,294)

10 Net Profit 4,063,704 4,192,822

11 Surplus brought forward 11,833,325 9,314,654

12 Profit Available for Appropriation 15,897,029 13,507,476

13 Transferred to general Reserve 1,000,000 1,000,000

14 Transferred to Capital redemption Reserve 1,473,200 -

15 Provision of Dividend on Preference Shares 2,780,052 580,052

16 Provision for Income Tax on Dividend 450,994 94,099

17 Balance carried to Balance Sheet 10,192,783 11,833,325

DIVIDEND:

On Equity:

Taking in to account the huge fund requirement for the large number of orders on hand, and to conserve the resources, the Directors do not recommend any dividend

On Preference Shares:

Company proposes to pay dividend on Preference Shares @11% for the year-ending on 31st March 2012, the dividend on 3, 00,000 redeemable preference shares allotted on 05.08.2011 is on pro rate basis.

The total cash outflow because of Dividend and Tax thereon amounts to Rs. 32.31 Lakhs.

REVIEW OF OPERATION:

Since recent past few years, the Company has seen upward trend of business and the same has been maintained during year under report.

The company's status in this respect is as under:

- The net Revenue Income during year under review increased by 2.70%

- Gross profit during the year under review Is Rs. 352.39 Lakhs as against the Gross profit of Rs. 315.42 Lakhs during the previous year which is 0.27 % higher than the previous year

- Profit after tax (PAT) decreased by 10.43 % from Rs. 47.47 Lakhs in 2010-2011 to Rs. 42.52 Lakhs in 2011-2012.

- Company could discharge the liability of Dividend on Preference shares & tax thereon to the tune of Rs. 32.31 Lakhs for the year under report i.e. for the year ending on 31st March 2012.

- During the year under report 3,00,000 11% redeemable preference shares of Rs. 100/- each were issued on preferential basis, to a Company in promoter group.

- During the year under report 14,732 Preference shares of Rs.100/- each have been redeemed on 31st March 2012, in terms of conditions of the issue of the said preference shares. On account of this redemption the total cash outflow works out to Rs.23,57,120/-, however the dividend amounting to Rs. 1,62,052/- on these redeemed shares will be paid along with dividend on other preference shares, after approval in the forthcoming 54th AGM.

FUTURE PROSPECTS:

Your company is in continual process of changing over of product-mix by using the advanced technology & adding some critical components in the product list of the company.

At present your Company has already executed a record breaking orders worth Rs.683.04 Lakhs till date and the orders worth Rs. 3829.77 Lakhs are in hand to execute in the current year. In addition to this, orders worth Rs. 1724. 75 Lakhs are in pipelines. Further healthy enquiries are being received regularly, and the management feels that most of them will be converted into firm orders.

To sum up, the outlook for the next year looks bright.

ALTERATION IN CAPITAL STRUCTURE:

During the year under Report, company has increased its authorized share capital from Rs. 400/- lakhs to Rs. 800/- Lakhs comprising of 40 lakhs equity shares of Rs. 10/- each and 40,000 Preference shares of Rs. 100/- each.

Company has issued 3 lakhs of Preference shares of Rs. 100/- each on preferential basis.

Also the company has redeemed 14,372 preference shares of Rs. 100/- each, in terms of the issue.

DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to Section 217(2AA) of the Companies Act, 1956, with respect to Directors' Responsibility Statement, it is hereby confirmed that:

(i) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to 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 true and fair view of the state of affairs of the Company as at 31st March 2012.

(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; and

(iv) The Directors have prepared annual accounts of the Company on a 'Going Concern' basis. SECRETARIAL REPORT:

Pursuant to Section 383A (1) of the Companies Act, 1956 secretarial compliance Certificate from a practicing Company Secretary is attached hereto.

PARTICULARS OF EMPLOYEES:

Information in accordance with the provisions 217 (2A) of the Companies Act 1956, read with the Companies (Particular of the Employees Rules) 1975 as amended, regarding particulars of employees is not applicable as none of the employees of the Company is given remuneration in the scale specified by that section

PUBLIC DEPOSITS: U/S 58A of the Companies Act, 1956:

There is no Fixed Deposit liability as on 31st March 2012, further, the Board declares that during the financial year 2011-12, the Company has not accepted any public deposits or unsecured loans falling within the purview of section 58A of the Companies Act, 1956.

RETIRING DIRECTORS BY ROTATION:

Mrs. Urmila Devi Mohta and Shri N. K. Daga retire by rotation and are eligible for re-appointment.

AUDITOR 8t AUDIT REPORT:

M/S A. C. Bhuteria & Co., Chartered Accountants, Kolkata 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 letters from them to the effect that their reappointment, if made, would be within the prescribed limits under section 224(1B) of the Companies Act, 1956 and they are not disqualified for such reappointment within the meaning of Section 226 of the said Act, Auditors have at clause XI in annexure to their report pointed out two defaults in repayment of dues to bank and financial institution, the board would like to stress the fact that on account of non recovery of timely dues from the company's

customers, small delay occurred in repayment of bank dues this is temporally aberration and the accounts are now regular

The Auditors Report is attached which is self explanatory.

PERSONNEL:

The industrial relations during the year remained extremely harmonious. The Directors wish to place on record their appreciation of the hard work and continuous efforts as well as valuable support rendered by the employees at all levels under review.

HEALTH AND SAFETY OF THE EMPLOYEE:

Health and safety of the employee has always been prime concern of the company and company has a medical officer to have routine checkup on the health of the employees.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

A. CONSERVATION OF ENERGY:

a. Energy conservation measures taken The present manufacturing process employed is not energy intensive and hence, there is limited scope for conservation of energy. However, efforts are being made to keep the consumption of power and fuel at minimum. B. Additional investments and proposals, if NIL any, being implemented for reduction of Consumption of energy;

c. impact of measures at (a) and (b) above NIL for reduction of energy consumption and consequent impact on the cost of production of goods; d. Total energy consumption and energy No statement in Form A pursuant to Companies consumption per unit of production as per (Disclosure of Particulars in the Report of the Form A. Board) 1988 is annexed as the company is not engaged in the activity specified in the schedule A to the said Rules.

B. Technology absorption:

e. Efforts made in technology absorption. As per Form B given below

Form B

Research and development (R & D)

1.Specific areas in which R & D carried out by the company NIL

2.Benefits derived as a result of the above R & D NIL

3.Future plan of action NIL

4.Expenditure on R & D a. Capital NIL

b. Recurring NIL

c. Total NIL d. Total R & D expenditure as per percentage of total turnover NIL

Technology absorption, adaptation and innovation

1. Efforts, in brief, made towards technology adsorption,, adaptation and Nil innovation 2. Benefits derived as a result of the above efforts, e.g. product improvement, Nil. cost reduction, product development, import substitution etc. 3. In case of imported technology ( imported during the last five years reckoned Nil from the beginning of the financial year), following information may be furnished: a. Technology imported.

b. Year of import.

c. Has technology been fully absorbed?

d. If not fully absorbed, areas where this has not taken place, reasons Not Applicable therefore and future plans of action

C. Foreign exchange earning and outgo:

f. Activities relating to exports; initiatives The Company is exploring the possibilities / avenues taken to increase exports; development for increasing Export earnings in foreign currency, of new export markets for products and Company has its own website services; and export plans; www.bemcohvdraulics.net for global marketing. q. Total foreign exchange used and earned. As per the table below

C.I.F. VALUE OF IMPORTS, EXPENDITURE AND EARNING IN FOREIGN CURRENCY

Particulars 2011-2012 2010-2011 Rs. Rs.

i). C.I.F. Value of Imports: Raw Materials And Components 1,02,70,897 13,57,472

ii). Expenditure in Foreign Currency:(paid/payable) Traveling 5,71,016 3,17,948 Exhibition Expenses - 4,24,444 (InnoTrans Berlin Germany) 23,75,538 - Technical Know How (incl. exchange Fluctuation) 23,03,320 2,06,436 Agency Commission

iii) Earnings in Foreign Exchange: FOB value of Exports 1,68,08,693 56,02,500

CORPORATE GOVERNANCE:

Your Company is committed to maintain the highest standards of Corporate Governance. Your Directors adhere to the stipulations set out in the Listing Agreement with the Stock Exchanges. BEMCO is compliant with the provisions of Clause 49 of the Listing Agreement even when the clause was not mandatory to it However, the Company could not comply with the following requirements of clause 49 since that clause became applicable to the Company for the first time and the Management had no clarity about the applicability of clause 49.

i) Non constitution of Audit Committee during the financial year.

ii) Non constitution of Investors' Grievance Committee.

iii) Non furnishing of quarterly compliance reports on corporate governance in terms of sub clause VI (ii) of clause 49 to Stock Exchanges for the quarters ended 30th September 2011, 31st December 2011 and 31st March 2012,

iv) Non forming of code of conduct for senior employees in the financial year.

The Management has taken necessary steps to fully comply clause 49 during current financial year, in the letter and spirit.

APPOINTMENT OF COMMON AGENCY FOR SHARE REGISTRY WORK

The Company has appointed M/S Adroit Corporate Services Private Limited, Mumbai to handle all the work related to Share Registry in terms of both Physical and Electronic mode, w. e. f. 1st February 2003, in pursuance with the Circular No. 15 dated December 27, 2002 issued by the Securities and Exchange Board of India.

DISCLOSURE AS PER LISTING AGREEMENT

The equity share of the company is listed on The Bombay Stock Exchange, and the company has paid the listing fees for the year 2012-2013. During the year there was no suspension in trading of the securities of the Company.

ACKNOWLEDGEMENT:

Your Directors wish to place on record their appreciation of the services rendered by the employees during the year.

Your Directors also place on record their sincere appreciation for the assistance and co-operation received from Financial Institutions, Bankers and other Institutions, Government Authorities, vendors, customers and members during the year under review. Your Directors wish to place on record their appreciation for the committed services of the executives, staff and workers of the Company.

For and on behalf of the Board of Directors

Place: BELGAUM M. M. MOHTA ANIRUDH MOHTA

Date: 28.05.2012 Chairman & Managing Director Joint Managing Director


Mar 31, 2011

Dear Shareholders,

The Directors have pleasure in presenting the 53rd ANNUAL REPORT together with the Audited Accounts of the Company for the year- ended 31st MARCH 2011.

FINANCIAL RESULTS:

The Financial results for the year under review in comparison with the previous year are given below:

2010-2011 2009-2010 Rs. Rs.

1 Gross Profit for the year after meeting all operating 31,303,404 28,472,316 expenses but before interest and depreciation amounts to:

2 Deduction there from: Interest 13,445,219 11,829,469

3 Profit before depreciation 17,858,186 16,642,847

4 Depreciation for the year 10,028,070 9,503,299

5 Profit before Taxation - (PBT) 7,830,116 7,139,548

6 Provision for Taxation (4,012,000) (2,835,500)

7 Deferred Tax 929,000 1,564,000

8 Profit after Taxation - (PAT) 4,747,116 5,868,048

9 Income tax Earlier Years (554,294) (25,514)

10 Net Profit 4,192,822 5,842,534

11 Surplus brought forward 9,314,654 5,148,512

12 Profit Available for Appropriation 13,507,476 10,991,046

13 Transferred to general Reserve 1,000,000 1,000,000

14 Provision of Dividend on Preference Shares 580,052 580,052

15 Provision for Income Tax on Dividend 94,099 96,340

16 Balance carried to Balance Sheet 11,833,325 9,314,654

DIVIDEND:

On Equity:

Taking in to account the huge fund requirement for the large number of orders on hand, and to conserve the resources, the Directors do not recommend any dividend on Equity Shares.

On Preference Shares:

Company proposes to pay dividend on Preference Shares @ 11% for the year-ending on 31st March 2011.

The total cash outflow because of Dividend and Tax thereon amounts to Rs. 6.74 Lakhs.

REVIEW OF OPERATION:

Since recent past few years, the Company is on upward trend of business and the same has been maintained during year under report.

The companys status in this respect is as under:

- The net Revenue Income during year under review increased by 19.43%

- Gross profit during the year under review is Rs. 313.03 Lakhs as against the Gross profit of Rs. 284.72 Lakhs during the previous year which is 9.94% higher than the previous year

- Profit after tax (PAT) decreased by 19.10 % from Rs. 58.68 Lakhs in 2009-2010 to Rs. 47.47 Lakhs in 2010-2011.

- Company could discharge the liability of Dividend on Preference shares & tax thereon to the tune of Rs. 6.74 Lakhs for the year under report i.e. for the year ending on 31st March 2011.

- During the year under report your Company has got ISO 9001:2008 Certificate from International Certification Services Pvt. Ltd. Mumbai.

FUTURE PROSPECTS:

The year under report 2010-11, was good year for your company as compared with 2009-10. Further your company is in continual process of changing over of product-mix by using the advanced technology & adding some critical components in the product list of the company. The Company has withstood the financial meltdown in the economy.

At present your Company has already executed orders worth Rs. 150.07 Lakhs till date and the orders worth Rs. 3346.84 Lakhs are in hand to execute in the current year. In addition to this, orders worth Rs. 1273.47 Lakhs are in pipelines. Further healthy enquiries are being received regularly, and the management feels that most of them will be converted into firm orders.

To sum up, the outlook for the next couple of years looks bright.

ALTERATION IN CAPITAL STRUCTURE:

During the year under Report, there is no change in Authorised, Issued & Subscribed and paid Capital Structure of the Company.

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 217(2AA) of the Companies Act, 1956, with respect to Directors Responsibility Statement, it is hereby confirmed that:

(i) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures from the same.

(ii) The Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company as at 31st March 2011.

(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; and

(iv) The Directors have prepared annual accounts of the Company on a Going Concern basis.

SECRETARIAL REPORT:

Pursuant to Section 383A (1) of the Companies Act, 1956 secretarial compliance Certificate from a practicing Company Secretary is attached hereto.

PARTICULARS OF EMPLOYEES:

Information in accordance with the provisions 217 (2A) of the Companies Act 1956, read with the Companies (Particular of the Employees Rules) 1975 as amended, regarding particulars of employees is not applicable as none of the employees of the Company is given remuneration in the scale specified by that section

PUBLIC DEPOSITS: U/S 58A of the Companies Act, 1956:

There is no Fixed Deposit liability as on 31st March 2011, further, the Board declares that during the financial year 2009-10, the Company has not accepted any public deposits or unsecured loans falling within the purview of section 58A of the Companies Act, 1956.

RETIRING DIRECTORS BY ROTATION:

Shri R. M. Shah and Shri Dilip Chandak retire by rotation and are eligible for re- appointment.

AUDITOR & AUDIT REPORT:

M/S A. C. Bhuteria & Co., Chartered Accountants, Kolkata 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 letters from them to the effect that their reappointment, if made, would be within the prescribed limits under section 224(1B) of the Companies Act, 1956 and they are not disqualified for such reappointment within the meaning of Section 226 of the said Act.

The Auditors Report is attached which is self explanatory.

PERSONNEL:

The industrial relations during the year remained extremely harmonious. The Directors wish to place on record their appreciation of the hard work and continuous efforts as well as valuable support rendered by the employees at all levels under review.

HEALTH AND SAFETY OF THE EMPOLYEE:

Health and safety of the employee has always been prime concern of the company and company has a medical officer to have routine checkup on the health of the employees.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

A. CONSERVATION OF ENERGY:

a. Energy conservation measures taken The present manufacturing process employed is not energy intensive and hence, there is limited scope for conservation of energy. However, efforts are being made to keep the consumption of power and fuel at minimum.

b. Additional investments and proposals, NIL if any, being implemented for reduction of consumption of energy;

c. Impact of measures at (a) and (b) NIL above for reduction of energy consumption and consequent impact on the cost of production of goods;

d. Total energy consumption and energy No statement in Form A pursuant to consumption per unit of production as Companies (Disclosure of Particulars in the per Form A. Report of the Board) 1988 is annexed as the company is not engaged in the activity specified in the schedule A to the said Rules.

B. Technology absorption:

e. Efforts made in technology absorption. As per Form B given below

Form B

Research and development (R & D)

1. Specific areas in which R&D carried NIL out by the company

2. Benefits derived as a result of the NIL above R&D

3. Future plan of action NIL

4. Expenditure on R & D

a. Capital NIL

b. Recurring NIL

c. Total NIL

d. Total R&D expenditure as per NIL percentage of total turnover

Technology absorption, adaptation and innovation

1. Efforts, in brief, made towards Nil technology adsorption,, adaptation and innovation

1. Benefits derived as a result of the Nil above efforts, e.g. product improvement, cost reduction, product development, import substitution etc.

3. In case of imported technology Nil (imported during the last five years reckoned from the beginning of the financial year), following information : may be furnished:

a. Technology imported.

b. Year of import.

c. Has technology been fully absorbed?

d. If not fully absorbed, areas Not Applicable where this has not taken place, reasons therefore and future plans of action

C. Foreign exchange earning and outgo:

f. Activities relating to exports; The Company is exploring the possibilities / initiatives taken to increase exports; avenues for increasing Export earnings in development of new export markets foreign currency. Company has its own for products and services; and export plans; website www.bemcohvdraulics.net for global marketing.

g.Total foreign exchange used and As per the table below earned.

C.I.F. VALUE OF IMPORTS, EXPENDITURE AND EARNING IN FOREIGN CURRENCY

Particulars 2010-2011 2009-2010 RS. RS.

i). C.I.F. Value of Imports:

Raw Materials And Components 13,57,472 NIL

ii). Expenditure in Foreign Currency:(paid/payable)

Traveling 3,17,948 28,653

Exhibition Expenses 4,24,444 NIL (Inno Trans Berlin Germany)

iii). Earnings in Foreign Exchange:

FOB value of Export 56,02,500 NIL

CORPORATE GOVERNANCE:

Your Company is committed to maintain the highest standards of Corporate Governance. Your Directors adhere to the stipulations set out in the Listing Agreement with the Stock Exchanges.

A report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges forms part of the Annual Report.

The company believes in good corporate practices to enable the Board to direct and control the affairs of the company in an efficient manner and to achieve its ultimate goal of maximizing shareholder value. Realizing this, the company has adopted many practices over the last few years, even when there are no mandatory requirements in this regard. As a result, a number of provisions regarding Corporate Governances prescribed by the Listing Agreements have already been complied with and steps are being taken to comply with the balance provisions. A separate note on Corporate Governance is enclosed herewith.

APPOINTMENT OF COMMON AGENCY FOR SHARE REGISTRY WORK

The Company has appointed M/S Adroit Corporate Services Private Limited, Mumbai to handle all the work related to Share Registry in terms of both Physical and Electronic mode, w. e. f. 1st February 2003, in pursuance with the Circular No. 15 dated December 27, 2002 issued by the Securities and Exchange Board of India.

DISCLOSURE AS PER LISTING AGREEMENT

The equity share of the company is listed on The Bombay Stock Exchange, and the company has paid the listing fees for the year 2011-2012. During the year there was no suspension in trading of the securities of the Company.

ACKNOWLEDGEMENT:

Your Directors wish to place on record their appreciation of the services rendered by the employees during the year.

Your Directors also place on record their sincere appreciation for the assistance and co- operation received from Financial Institutions, Bankers and other Institutions, Government Authorities, vendors, customers and members during the year under review. Your Directors wish to place on record their appreciation for the committed services of the executives, staff and workers of the Company.

For and on behalf of the Board of Directors

M. M. MOHTA ANIRUDH MOHTA Chairman & Managing Director Joint Managing Director



Place: BELGAUM Date : 27.05.2011








Mar 31, 2010

The Directors have pleasure in presenting the 52nd annual REPORT together with the Audited Accounts of the Company for the year-ended 31st MARCH 2010.

FINANCIAL RESULTS:

The Financial results for the year under review in comparison with the previous year are given below:

2009-2010 2008-2009

Rs. Rs.

1 Gross Profit for the year after meeting all operating 28,472,316 26,023,904 expenses but before interest and depreciation amounts to:

2 Deduction there from: Interest 11,829,469 10,852,043

3 Profit before depreciation 16,642,847 15,171,861

4 Depreciation for the year 9,503,299 9,023,883

5 Profit before Taxation - (PBT) 7,139,548 6,147,978

6 Provision for Taxation (2,835,500) (2,709,500)

7 Provision for FBT - (729,500)

8 Deferred Tax 1,564,000 90,000

9 Profit after Taxation - (PAT) 5,868,048 2,798,978

10 Income tax Earlier Years (25,514) 523,484

11 Net Profit 5,842,534 3,322,462

12 Surplus brought forward 5,148,512 3,504,682

13 Profit Available for Appropriation 10,991,046 6,827,144

14 Transferred to general Reserve 1,000,000 10,00,000

15 Provision of Dividend on Preference Shares 580,052 5,80,052

16 Provision for Income Tax on Dividend 96,340 98,580

17 Balance carried to Balance Sheet 9,314,654 5,148,512

DIVIDEND:

On Equity:

Taking in to account the huge fund requirement for the large number of orders on hand, and to conserve the resources, the Directors do not recommend any dividend on Equity Shares.

On Preference Shares:

Company proposes to pay dividend on Preference Shares @11% for the year-ending on 31st March 2010.

The total cash outflow because of Dividend and Tax thereon amounts to Rs. 6.76 Lakhs.

REVIEW OF OPERATION:

The year 2009-10 has witnessed recovery from the global economic slowdown during 2008-09 for most of the Engineering & other Auto Component industries. As a result your company was able to maintain its gross performance at par with previous the year (2008-09).

The companys status in this respect is as under:

- The net Revenue Income during year under review decreased by 0.84 %

- Gross profit during the year under review is Rs, 284,72 Lakhs as against the Gross profit of Rs. 260.23 Lakhs during the previous year which is 9.41% higher than the previous year

- Profit after tax (PAT) increased by 109.65 % from Rs. 27.99 Lakhs in 2008- 2009 to Rs. 58.68 Lakhs in 2009-2010.

- Company could discharge the liability of Dividend on Preference shares & tax thereon to the tune of Rs. 6.76 Lakhs for the year under report i.e. for the year ending on 31st March 2010.

- During the year under report your Company has got ISO 9001:2008 Certificate from International Certification Services Pvt. Ltd. Mumbai.

FUTURE PROSPECTS:

The year under report 2009-10, was good year for your company as compared with 2008-09. Further your company is in continual process of changing over of product-mix by using the advanced technology & adding some critical components in the product list of the company. The Company has withstood the financial meltdown in the economy.

At present your Company has already executed orders worth Rs.75.47 Lakhs till date and the orders worth Rs. 2537.89 Lakhs are in hand to execute in the current year. In addition to this, orders worth Rs. 2495.38 Lakhs are in pipelines, which are to be executed in the year 2011-12. Further healthy enquiries are being received regularly, and the management feels that most of them will be converted into firm orders,

To sum up, the outlook for the next few years looks bright.

ALTERATION IN CAPITAL STRUCTURE:

During the year under Report, there is no change in Authorised, Issued & Subscribed and paid Capital Structure of the Company.

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 217(2AA) of the Companies Act, 1956, with respect to Directorsd Responsibility Statement, it is hereby confirmed that:

(i) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departuress from the same.

(ii) The Directors have selected such accounting policies and applied them consistentlyis and made judgements and estimates that are reasonable and prudent so as tQs give true and fair view of the state of affairs of the Company as at 31st March 2010.

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

(iv) The Directors have prepared annual accounts of the Company on a Going Concern basis.

SECRETARIAL REPORT:

Pursuant to Section 383A (1) of the Companies Act, 1956 secretarial compliance Certificate from a practicing Company Secretary is attached hereto.

PARTICULARS OF EMPLOYEES:

Information in accordance with the provisions 217 (2A) of the Companies Act 1956, read with the Companies (Particular of the Employees Rules) 1975 as amended, regarding particulars of employees is not applicable as none of the employees of the Company is given remuneration in the scale specified by that section

PUBLIC DEPOSITS: U/S 58A of the Companies Act, 1956:

There is no Fixed Deposit liability as on 31st March 2010, further, the Board declares that during the financial year 2009-10, the Company has not accepted any public deposits or unsecured loans falling within the purview of section 58A of the Companies Act, 1956.

RETIRING DIRECTORS BY ROTATION:

Smt. Urmila Devi Mohta and Shri N. K. Daga retire by rotation and are eligible for re- appointment.

AUDITOR & AUDIT REPORT:

M/S A. C. Bhuteria & Co., Chartered Accountants, Kolkata 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 letters from them to the effect that their reappointment, if made, would be within the prescribed limits under section 224(1B) of the Companies Act, 1956 and they are not disqualified for such reappointment within the meaning of 5ection 226 of the said Act.

The Auditors Report is attached which is self explanatory.

PERSONNEL:

The industrial relations during the year remained extremely harmonious. The Directors wish to place on record their appreciation of the hard work and continuous efforts as well as valuable support rendered by the employees at ail levels under review.

HEALTH AND SAFETY OF THE EMPOLYEE:

Health and safety of the employee has always been prime concern of the company and company has a medical officer to have routine checkup on the health of the employees.

CORPORATE GOVERNANCE :

Your Company is committed to maintain the highest standards of Corporate Governance. Your Directors adhere to the stipulations set out in the Listing Agreement with the Stock Exchanges.

A report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges forms part of the Annual Report.

The company believes in good corporate practices to enable the Board to direct and control the affairs of the company in an efficient manner and to achieve its ultimate goal of maximizing shareholder value. Realizing this, the company has adopted many practices over the last few years, even when there are no mandatory requirements in this regard. As a result, a number of provisions regarding Corporate Governances prescribed by the Listing Agreements have already been complied with and steps are being taken to comply with the balance provisions. A separate note on Corporate Governance is enclosed herewith.

APPOINTMENT OF COMMON AGENCY FOR SHARE REGISTRY WORK

The Company has appointed M/S Adroit Corporate Services Private Limited, Mumbai to handle all the work related to Share Registry in terms of both Physical and Electronic mode, w. e. f. 1st February 2003, in pursuance with the Circular No. 15 dated December 27, 2002 issued by the Securities and Exchange Board of India.

DISCLOSURE AS PER LISTING AGREEMENT

The equity share of the company is listed on The Bombay Stock Exchange, and the company has paid the listing fees for the year 2010-2011. During the year there was no suspension in trading of the securities of the Company.

ACKNOWLEDGEMENT:

Your Directors wish to place on record their appreciation of the services rendered by the employees during the year.

Your Directors also place on record their sincere appreciation for the assistance and co- operation received from Financial Institutions, Bankers and other Institutions, Government Authorities, vendors, customers and members during the year under review. Your Directors wish to place on record their appreciation for the committed services of the executives, staff and workers of the Company.

For and on behalf of the Board of Directors

Place: BELGAUM

Date: 26.05.2010 M. M. MOHTA ANIRUDH MOHTA Chairman & Managing Director Joint Managing Director

 
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