Mar 31, 2018
DIRECTORS'' REPORT & MANAGEMENT DISCUSSION & ANALYSIS REPORT
Dear Members,
Your Directors present the Fifty- Fifth Annual Report of the Company together with the Audited Financial Statements for the Financial Year ended 31st March, 2018.
1. FINANCIAL HIGHLIGHTS |
|
(Rs in Lakhs) |
Particulars |
Year ended 31st March, 2018 |
Year ended 31st March, 2017 |
Total Income |
4,305 |
18,387 |
EBIDTA** |
(394) |
1,600 |
Finance Costs |
5,073 |
5,249 |
Depreciation & Amortization |
85 |
170 |
Transfer from Business Re- organization Reserve (BRR) |
(5,353) |
(5,854) |
Profit before Tax |
(479) |
1,430 |
Less: Tax Expense (Current Tax and Tax on Earlier Years) |
0 |
0 |
Less:Deferred Tax Charged/ ( Credit) |
26 |
362 |
Profit after Tax |
(505) |
1,067 |
Other Comprehensive Income |
6A |
(19) |
Total Comprehensive Income |
(499) |
1,049 |
** After transfer of Rs. 230 Lakhs and Rs. 605 lakhs to BRR respectively in the years 2018 and 2017.
* Previous year figures have been re-stated as per Indian Accounting
Standards (Ind AS).
"Rounded off. Actual amount Rs.5.45 Lakhs
2. REVIEW OF OPERATIONS
Your Company is engaged in the business of providing, media, publication services, trading in shares and securities. Your Company has stopped providing management support services to its subsidiaries.
For the year under review, your Company earned a Total Income of Rs.4305.24 Lakhs as against ? 18387.49 Lakhs in the previous year. Company''s earning Profit after Tax of ?(505) Lakhs (including amount transferred before EBIDTA) as against ? 1,067.33 Lakhs in the previous year after transfer of sum of Rs. 5353.17 Lakhs from Business Re-organization Reserve as against? 5,854.02 Lakhs last year. The Company was providing Logistics Services to one of its Subsidiaries i.e Binani Cement Limited (till 24th July 2017). BCL is now taking logistics services from other vendors. The company is in the process of finding alternate business opportunities.
3. DIVIDEND
In view of loss, the Directors do not recommend any dividend on Preference and Equity Shares of the Company for the Financial Year ended 31st March, 2018. In terms of Section 47(2) of Companies
Act, 2013 Triton Trading Company Private Limited (TTCPL), the preference shareholder of the Company shall have a right to vote on all resolutions placed before the Company on account of nonpayment of dividend on 12,298,000 - 0.01% Non -cumulative Redeemable Preference Shares of Rs. 100/- each fully paid-up held by TTCPL in the Company. These shares were allotted on March 31, 2015.
4. RESERVES
No amount is proposed to be transferred to Reserves.
5. SHARE CAPITAL
During the financial year under review there have been no changes in the Authorised, Issues, subscribed and paid up share capital of the Company.
6. CONSOLIDATED FINANCIAL STATEMENTS
A. In accordance with the provisions of sub-section (3) of section 129 of the Companies Act 2013 and the SEBI Listing Obligation and Disclosure Requirements Regulations, 2015, the Consolidated Audited Financial Statements of the Company including the financial details of all the subsidiary companies of the Company forms part of this Annual Report. The Consolidated Financial Statements have been prepared in accordance with applicable Accounting Standards prescribed under Section 133 of the Companies Act 2013, subject to the following :-
1. Binani Cement Limited (BCL), a major subsidiary was admitted under the Corporate Insolvency and Resolution Process (CIRP) in accordance with the Insolvency and Bankruptcy Code, 2016 (IBC) dated July 25, 2017 and a Resolution Professional was appointed. Effective from July 25, 2017 the Board of Directors of BCL were suspended and effectively Binani Industries Limited lost control over BCL with regards to operational and financial decision-making powers and derive economic benefits from its activities. The Company has not received the consolidated management accounts duly signed for the period April 01, 2017 till July 24, 2017 (date up to which the company had control) and accordingly couldn''t draw consolidated financial statement of the group for the year ended March 31,2018 within time.
2. Pending receipt of BCL financial statement stated above, the Company made application to SEBI requesting time to declare Consolidated Financial results for the year ended March 31, 2018. SEBI vide letter dated 25th June, 2018 declined the Company''s request. However, management continue to wait for the BCL financial statement to ensure compliance with the Indian Accounting Standard and also obtained extension for holding Annual General Meeting for adoption of annual accounts vide ROC letter dated 23rd August, 2018.
3. As the Company lost control over BCL it couldn''t obtain the BCL consolidated financial statement till date and prepared these consolidated financial without consolidating BCL financial results for the period; the assets and liabilities and Non-controlling interest of/ in BCL is not derecognized from the consolidated financial statements; and retained interest as of July 24, 2017 is not accounted at fair value.
4. The final order was passed by the National Company Law Tribunal on 14th November 2018 approving the resolution plan submitted by Ultratech Cement Limited and post the dismissal of the application by M/s Rajputana Properties Pvt. Ltd. to the Supreme Court on 19th November 2018, the same became effective. However, pending clarity and implementation of the Resolution Plan by Ultratech Cement limited, no impact has been provided of the said resolution plan in these consolidated financial statements for the year ended March 31, 2018.
5. Accordingly, investment in equity and noncumulative redeemable preference shares of Binani Cement Ltd (BCL) have been carried at the fair value arrived as on March 31,2017 of Rs. 339,738 lakhs and ? 1,621 lakhs for as at March 31, 2018. Also no provision / adjustment have been made toward the outstanding balance of loans and advances of ? 700 lakhs, security deposits of Rs.100 lakhs and trade receivables of Rs. 1362.10 lakhs due from BCL.
6. No impact has been considered on the outstanding liabilities (payable to BCL and to lenders) and guarantees given on behalf BCL or guarantees given by BCL on behalf of Company and its subsidiaries.
B. Having regard to the ongoing Corporate Insolvency and Resolution Process in respect of BCL there are various news being reported / appear in public domain involving/ mentioning about the Company, BCL, Promoters and other group companies however the management of the Company is confident that these allegations are baseless and lacks merit.
7. DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of clause of sub-section (3) and subsection (5) section 134 of the Companies Act 2013 (''the Act'') your Board of Directors state and confirm that:-
a. In the preparation of the annual financial statements for the year ended March 31, 2018, the applicable Accounting Standards read with requirements set out under Schedule III to the Act, have been followed and proper explanation relating to material departures, if any, has been furnished;
b. We have selected such accounting policies as listed in the Financial Statements and have applied them consistently and prudent judgments & estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2018 and of the profits of the Company for the financial year ended on that date;
c. We have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of ''the Act'' for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. We have prepared the annual accounts for the financial year ended on March 31, 2018 on a going concern basis.
e. We have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively and
f. We have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
8. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
a. Exim Bank of India, the Company''s Lender has recalled the loan. Exim Bank of India has also invoked the Corporate Guarantee issued by Binani Cement Limited. Since CIRP of Binani Cement Limited is underway, the Company is expecting a suitable resolution shortly.
b. B T Composites Limited a subsidiary of the Company is in the process of voluntary liquidation and has appointed Mrs. Sara Sancheti, a Company Secretary in Whole Time Practice as the liquidator of the Company. The procedure for voluntary liquidation is underway.
c. Binani Global Cement Holdings Private Limited, Singapore has received approval in July 2017 from the Accounting and Corporate Regulatory Authority of Singapore for closure of the Company and intimation to Reserve Bank of India through the Authorised Dealer has been made.
9. PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED
During the year under review, the loans given, investments made and Guarantees given and securities provided under Section 186 of the Companies Act 2013 are given in the Notes to the Standalone Financial Statements.
10. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All transactions entered into by the Company with related parties were in the ordinary course of business and at arm''s length. The Audit Committee from time to time reviewed and approved the said transactions. The details of existing Related Party Contracts/ Arrangements, modified during 2017-18 are disclosed in form AOC-2 in terms of Section 134 of the Companies Act 2013 is provided as Annexure A and in the notes to the Financial Statements.
11. DEPOSIT
The Company has not accepted any deposit from the public within the meaning of sub-section (31) of section 2 and Section 73 of the Companies Act, 2013 and Rules framed thereunder.
12. OUTLOOK
The year 2017-18 has been a year of mixed bag for the Group.
Edayar Zinc Limited (EZL) operations were shut for the entire year. The Consortium of Banks led by Punjab National Bank have taken symbolic possession of the mortgaged assets on 21st July, 2016 and are conducting / in the process of conducting auctions for sale of the mortgaged properties. Meanwhile, the management of EZL has already entered into settlement agreements with the workers and EZL is hopeful that Creditors and Authorities will take measured stand to safeguard interest of all stakeholders.
The Group''s Glass Fibre business, both in India and abroad have shown considerable improvement for the year under review. Improved business conditions in European Markets with several measures undertaken to improve efficiency across different operating areas, resulted in significantly improved top line as well as bottom-line.
BIL Infratech Limited another subsidiary of your Company continued to report fairly good performance.
13. REPORT ON SUBSIDIARY COMPANIES
In accordance with Proviso to sub-section (3) of Section 129 of the Companies Act, 2013 ("Act"), the salient features of the Financial Statements of Subsidiary Companies are set out in the prescribed Form AOC - 1 which forms part of this Report. The said Financial Statements shall also be kept for inspection by the Members at the Registered Office of the Company. The Company will provide free of cost, a copy of Financial Statements in respect of its subsidiaries to any Member of the Company, upon receipt of a request for the same.
FINANCIAL HIGHLIGHTS AND BUSINESS OUTLOOK OF THE COMPANY''S SUBSIDIARY COMPANIES
Binani Cement Limited (BCL), a major subsidiary was admitted under the Corporate Insolvency and Resolution Process (CIRP) in accordance with the Insolvency and Bankruptcy Code, 2016 (IBC) dated July 25, 2017 and a Resolution Professional was appointed. Effective from July 25, 2017 the Board of Directors of BCL were suspended and effectively Binani Industries Limited lost control over BCL with regards to operational and financial decision-making powers and derive economic benefits from its activities.
Edayar Zinc Limited (formerly Binani Zinc Limited)
Financial Highlights |
|
(Rs. in Lakhs) |
Particulars |
2017-18 |
2016-17 |
Total Revenue |
28 |
201 |
Loss before Interest, Depreciation & Tax |
(238) |
(226) |
Interest and finance charges |
- |
1 |
Provision for Depreciation |
381 |
389 |
Loss before Tax |
(619) |
(616) |
Exceptional Items |
(2857) |
|
Provision for Tax |
- |
- |
Loss after Tax |
(3476) |
(616) |
Review of Operations
During the Financial Year 2017-18 the Company did not operate its plant and pursuant to the repealing of Sick Industrial Companies (Special Provisions) Act, 1985 (SICA), the reference made to Board of Industrial and Financial Reconstruction (BIFR) got abated.
Lenders to the Edayar Zinc Limited ("EZL") a Subsidiary of the Company have initiated action under Section 13(4) of The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act 2002) for recovery of their dues and has taken symbolic possession in July 2016.
EZL where lenders have initiated Sarfaesi Action and are conducting / in the process of conducting auctions for sale of mortgaged property. EZL is hopeful that Lenders, Creditors and Authorities will take a measured stand to safeguard interest of all stakeholders.
During FY 2018 ("the year under review"), total revenue was Rs. 27.84 lakhs as against Rs. 200.74 lakhs during corresponding previous FY 2017. The Company recorded negative EBIDTA of Rs. 237.58 lakhs in FY 2018 vis-a-vis negative EBITDA of Rs. 225.10 lakhs last year.
3B Binani Results Highlights 2018 (including Goa Glass Fibre Limited)
Financial Highlights |
|
Euro in Million) |
Particulars |
2017-18 |
2016-17 |
Total Revenue |
213,37 |
199,70 |
Profit before, Depreciation, Interest & Taxation and Exceptional Items |
45,40 |
43,40 |
Provision for Depreciation |
20,21 |
18,89 |
Interest and Financial Charges |
19,36 |
20,90 |
Profit /(Loss) before Tax & Except items |
16,37 |
-2,77 |
Exceptional items |
1,88 |
4,75 |
Tax & Deferred tax |
1,09 |
0,00 |
Profit /(Loss) after tax |
13,40 |
-7,53 |
Financial Highlights
3B Binani, on a consolidated basis, reported a further improvement in its operating performance in the year 2017-18. The total revenue increased by 6.8% mainly driven by an increase in sales volume. Profit before Depreciation, Interest and Taxation increased also by 4.6% versus last year (2016-17). The improvement is mainly driven by robust market conditions and continuing commercial efforts which enabled us to increase the sales volume. The ongoing implementation of the profitability improvement plan covering all key financial drivers also strongly contributed to the overall performance improvement. On top of these internal factors, the net profit improvement is also partially driven by the weakening of the dollar and the associated impact on the revaluation of the acquisition loan.
Industry Overview
The European Market in 2017 was really strong with an average growth estimated at 7.7% versus 2016. CS grew significantly 13.2% together with Mat 13.0%. The growth in CS was supported by a robust automotive market. On the other hand, DR grew a small 1.7% amid some concern on the back of the wind industry expected to slow down due to the shift in the support mechanism in Germany and the UK. In India, the Glass fibre Industry is estimated to have grown by a CAGR of 7% during the period 2011 -2016. Demand was affected though in 2017, as Indian economy suffered the impact of demonetisation (Oct 16), the GST implementation (July 17) and the temporary slowdown of the Wind Industry. Glass fibre consumption is estimated to have slightly come down, -4.7% from last year. The economy in India is expected to be back on track by 2018. Glass fibre demand will then follow with an expected growth of 7% per year.
Market outlook
3B Binani will continue to focus on its core markets Automotive, Wind and Performance Composites, supplying these markets with high quality Chopped Strands and Direct Roving products, supported by high performance specialty products like HiPer-tex⢠and CFM. 3B Binani still shows a strong focus on innovation to develop value-added products for its customers in order to deliver product differentiation, to improve the profitability and to keep ahead of competition. Looking ahead, the overall demand growth for glass fibre in Europe is expected to continue with the economies remaining robust. In India, the wind market is coming back as expected which is very encouraging for the years to come.
BIL Infratech Limited (BILIL)
BILIL is a wholly owned subsidiary of Binani Industries Ltd. (BIL). BILIL is engaged in construction works on EPC, Design & Build and BOQ Item rate contracts in following fields in all relevant disciplines like Civil & Structure, Inter!or works, Electrical, Building Automation, Mechanical, PHE Plumbing & Sanitary, Firefighting, HVAC, STP/ETP/WTP, Alternative Energy etc.
i. Industrial Units: Material Handling in Mines & Minerals and some processing units.
ii. Infrastructure: Bridges, Hospitals, Institutions, Disaster Management facility, Industrial Park, Tram track, Border out posts etc.
iii. Real Estate : Both Commercial & Residential
Financial Highlights |
|
(Rs. in Lakhs) |
Particulars |
2017-18 |
2016-17 |
Total Revenue |
25127 |
24574 |
Profit before Depreciation, Interest and Tax and Exceptional Items |
1781 |
1156 |
Provision for Depreciation |
138 |
141 |
Interest and Financial Charges |
727 |
332 |
Profit/ (Loss) before Tax |
916 |
859 |
Provision for Tax |
332 |
305 |
Profit /(Loss) after Tax |
584 |
553 |
Operations Review
BILIL reported the total income of Rs. 25,126.92 lacs for the year under review as against Rs. 24,574.40 lacs in the previous year. It reported a Profit after Tax of Rs. 583.88 lacs as compared to Rs. 553.22 lacs in the previous year.
Industry Overview
The Year 2017-18 continued to be challenging for BILIL whereas India achieved 7.36% GDP growth as compared to 6.74% in previous year and was globally acknowledged as the world''s fastest growing economy. Plethora of opportunities predominantly in Infrastructure, Rail, Road and Power & Renewable Energy had been visible. The Smart City Mission with assured budgetary support to create 100 Smart Cities across India had also bolstered the optimism significantly.
Strong signs of economic revival visible with higher consumer confidence, Industry and Infrastructure sector from the beginning of FY2017-18 with lot of construction tenders floating in infrastructure field. BILIL bagged lot of jobs during 2017-18 aggregating to a total value of Rs.440.00 Cr. However due to restrictions in BG limit with Bankers, current financial year i.e. 2018-19 could be a challenging year to bid for further new tenders.
Business Outlook
Stable and visionary Government, policy reforms, strong possibility of simplified Tax regime and continued efforts to improve Ease-of-doing-business have made India a bright spot in global investment map. Higher Govt. spending in key sectors such as Infrastructure, Rail, Road, Port, Power, robust FDI in Manufacturing and defence production will push up growth prospect tremendously.
On-going Policy reforms, divestment of PSU stakes, relaxed FDI norms to allow foreign players in Indian Infrastructure Sector and thrust towards clean Energy and Make-in-lndia initiative will create investment friendly environment and fuel growth momentum further. This will significantly drive demand in key Industry sectors like Cement, Steel, Mining and other Metals. Overall there will be high growth scenario in a wide spectrum of industries.
However, there is possibility of Govt. funding target not being met. At the same time high debt levels of private Infrastructure players, cautious approach of Banks for new investment proposals and RBI''s dictate to banks to be decisive and apply the newly enacted Insolvency and Bankruptcy Code, 2016 (IBC) framework against the erring defaulters with NPA accounts in addition to the traditional land acquisition issues may hold back the pace of private investments and could be potential growth decelerators.
Opportunity and Threats
Higher Govt. spending to build robust infrastructure, single goods and services tax (GST), favorable Govt. approach towards PPP Model, lower fiscal deficit and low interest regime are expected to boost long-term inbound investment actively.
However, rising inflation and high debt levels of large scale Private infrastructure developers may constrain investment in this sector. Inability of Govt. funding through divestment of PSUs may dampen investment scenario further.
Way forward of the Company
In order to ensure growth, we have to book more and more orders and in order to book orders in this competitive market we have no other way but to accept minimum margin. Hence we are looking for more volume and minimum margin in conventional item rate construction contracts.
The only available way of earning more margins is to focus on EPC or Design & Built contracts where there is less competition but it calls for strong credential in respective fields which we are lacking but we have to gradually build it by engaging as JV partner or associate or back to back sub contract.
Company''s Growth Plan for next three years
FY 2018-19 ->Rs. 300 Cr from target Order book position of Rs.800 Cr FY 2019-20 -> Rs.325 Cr from target Order book position of Rs.800 Cr FY 2020-21 -> Rs. 350 Cr from target Order book position of Rs.850 Cr
Global Composite Holdings Inc. formerly known as CPI Binani Inc. (CPI Binani)
Financial Highlights
|
(In mn USD) |
|
Particulars |
2017-18 |
2016-17 |
Total Revenue |
- |
0.001 |
Profit before Depreciation, Interest and Tax and Exceptional Items |
- |
0.001 |
Provision for Depreciation |
- |
- |
Interest and Financial Charges |
- |
- |
Profit/ (Loss) before Tax |
0.004 |
0.038 |
Provision for Tax |
- |
- |
Profit /(Loss) after Tax |
0.004 |
0.038 |
CPI has been incurring losses and in March 2015, it sold its assets to Core Moulding Technologies Inc USA. The Company is looking out for new business opportunities.
B T Composites Limited (BTCL)
BTCL is wholly owned subsidiary of the Company and is under the process of Voluntary winding- up.
OTHER SUBSIDIARIES
a. Royalvision Projects Private Limited wholly owned Subsidiary which was incorporated 3-4 years back, is yet to commence any business activities. The Company made marginal profit for the financial year ended 31st March, 2018. This was on account of certain routine administrative expenses incurred by the Company.
14. AUDIT OBSERVATIONS
The Auditors, in their Report, have made observations in connection with creation of Business Re-organization Reserve (BRR) and transfer of sums to offset certain expenses/write-offs, fair valuation of the Company''s investments done by the Company, and outstanding guarantees issued by the Company to banks and financial institutions on behalf of subsidiaries including one step down subsidiary which are significant in relation to the networth of the Company,
The Board wishes to state as follows:
a. Pursuant to a separate Scheme of Amalgamation approved by the Hon''ble High Court at Calcutta between WIEL and a step down wholly owned subsidiary of the Company on 18th March 2014, being the Company as a successor to WIEL, the Company has applied AS 30, the Accounting Standard on Financial Instruments: Recognition and Measurement, issued by the Institute of Chartered Accountants of India (ICAI), and pursuant thereto has as on March 31, 2014, being the date of conclusion of the first Accounting Year post the provisions of AS 30 becoming applicable to the Company, classified the investments as "available for sale financial assets" and has accordingly, measured such investments at fair value as on that date. All amount required to be taken as per AS 30 to revenue reserve or to an appropriate equity account shall be aggregated and such aggregate shall be taken to the Business Reorganisation Reserve (BRR). In the event of any conflict between the provision of AS 30 and any other Accounting Standards, the provision of AS 30 will be applied in preference to any other Accounting standard. BRR shall constitute a reserve arising as per this Scheme and shall not for any purpose be considered to be a Reserve created by the Company. During the year, the Institute of Chartered Accountants of India (ICAI) has withdrawn Accounting Standard 30 (Accounting Standard on Financial Instruments: Recognition and Measurement). Consequent to this, the Company, backed by legal opinion, has applied principles of notified Ind AS related to Financial Instruments being new accounting standards applicable instead of AS 30. All equity investment including Investment in Subsidiaries are designated as fair value through profit & loss. Accordingly, all amounts required to be taken as per the Financial Instruments Standards under Ind AS to revenue reserve or to an appropriate equity account / Other Comprehensive Income are aggregated and such aggregate is taken to Business Re-organization Reserve (BRR) in line with the afore-cited court order. This matter has been referred to by the auditors.
b. As per the DRT order on the Securitization Application Edayar Zinc Limited (EZL) has paid Rs. 247.25 Lacs by March 31, 2018 and continues to pay Rs. 25000 per day. EZL has not provided interest on banks loans for the year amounting to Rs. 4992.18 Lacs.
c. The Company had given guarantees to banks and financial institutions in the earlier years on behalf of various subsidiaries, for the purpose of expansion projects and working capital requirements. The outstanding aggregate balance of these guarantees is Rs. 590,247 Lacs as on March 31, 2018. The Subsidiaries have sufficient assets to meet their borrowings. Considering the same, in the opinion of the management, these are not expected to result into any financial liability to the Company.
d. The Company was in the process of restructuring its bank borrowings with the Lender. However, in the interim, the said Lender has communicated to the Company that it is recalling its borrowings and has also designated the foreign currency debt into INR denominated debt with higher coupon rate and has demanded repayment of all out standings including corresponding interest and penal interest immediately. The Company has requested the Lender to defer the recall and has in the interim provided alternative mechanism for repayment of its loans in due course. The Company is awaiting response from the Lender in this behalf. Hopeful of a favourable consideration by the Lender of its alternative mechanism, the Company continues to denominate such loans in Foreign currency and has not classified the outstanding Loan as Current Liabilities. Further, it has also not accrued differential and penal interest.
e. The final order was passed by the National Company Law Appellate Tribunal on 14th November 2018 approving the resolution plan submitted by Ultratech Cement Limited and post the dismissal of the application by M/s Rajputana Properties Pvt. Ltd. to the Supreme Court on 19th November 2018, the same became effective. However, pending clarity and implementation of the Resolution Plan by Ultratech Cement Limited, no impact has been provided of the said resolution plan in these consolidated financial statements for the year ended March 31, 2018.
The Group had given corporate guarantees on behalf of BCL of Rs. 3,79,792 Lakhs as on March 31, 2018. BCL has also jointly and severally Guaranteed the loans along with the Company on behalf of 3B Binani Glass Fibre Sari, Luxembourg aggregating to Rs.1,63,061 lakhs as on March 31, 2018. The Lender to 3B Binani Glass Fibre Sari, Luxembourg had submitted its claim to BCL resolution professionals.
The Company was in the process of restructuring its bank borrowings with the lender. However, in the interim, the said lender has communicated to the Company that it is recalling its borrowings and has also designated the foreign currency debt into INR denominated debt with higher coupon rate and has demanded repayment of all outstanding debt balance along with corresponding interest and penal interest, immediately. The Company has requested the lender to defer the recall and has in the interim provided alternative mechanism for repayment of its loans in due course. The lender had filed its claim to BCL (subsidiary till July, 24, 2017) which is under the IBC process and has also invoked the Corporate Guarantee issued by BCL which forms part of Resolution plan alongwith interest payable. As per Resolution plan approved by NCLAT, the Financial Liabilities of Binani Cement Limited and those liabilities which are guaranteed by Binani Cement Limited will be paid with interest up to the date of payment by Ultratech Cement Limited.
15. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP) Directors:
Mr. Braj Binani retires by rotation and being eligible, has offered himself for re-appointment.
The Board of Directors appointed Mr. Rajesh Kumar Bagri as an Additional Director (Non Independent) of the Company with effect from 26th April, 2018 in terms of provision of Section 161 of the Companies Act 2013 (''the Act'')
Mr. Rajesh Kumar Bagri, aged about 60 years, is a B.com (Hons) from St. Xavier''s College and has 38 years of Experience as Consultant and Advisor. His areas of expertise as consultant and as Faculty in varied subjects ranging Information Technology and its use in Human Productivity. He has developed specialised techniques in restoration /rejuvenation of engineering drawings including conversion of raster images to vector and digital formats and reducing imaging errors.
Mr. Bagri was also involved in handling various documentation and legal work and has conducted workshops and specialised studies for Ordnance Factories Steel Plants and other Public and Private Sector Industries.
Mr. Rajesh Kumar Bagri shall hold the office as Director of the Company upto the ensuing Annual General Meeting of the Company. The Company has received a notice along with requisite deposit from a Member signifying its intention to propose the candidature of Mr. Rajesh Kumar Bagri as Director.
Pursuant to the provisions of Sections 152, 161 and other applicable provisions, if any, of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014 (including any statutory amendments, modifications or re-enactments thereof for the time being in force), Mrs. Visalakshi Sridhar (DIN-07325198) was appointed as an Additional Director designated as Managing Director of the Company w.e.f 13th August, 2018 for a period of 3 years effective from 13th August, 2018 till 31st July, 2021 at Rs. 6,24,435/-p.m.
Mrs. Visalakshi Sridhar aged about 52 years is B.com, AICWA and ACS; She has experience of over 28 years in diversified business in the domain of Finance, Strategy, Accounts and Company Secretary. She has been associated with the Group for over 20 years in various capacities. During her association with the Group, the Group has completed organic and inorganic expansion in Cement and Glass Fibre.
In addition to the above she is also a Chief Financial Officer and Company Secretary of the Company.
The term of office of Mrs Sridhar as an Additional Director would expire at the forthcoming Annual General Meeting. Accordingly the approval of the members is sought for appointment and payment of remuneration to Mrs Sridhar as the Managing Director of the Company for a period of three years effective from 13th August, 2018 to 31s1 July, 2021.
The Board recommends the aforesaid appointment/re-appointment of the Directors. Brief profile of the Directors proposed to be appointed /re-appointed is annexed to the Notice convening ensuing Annual General Meeting.
Mrs. Nidhi Binani Singhania and Mrs. Shradha Binani had tendered their resignation on 26th April, 2018. The Board of Directors wishes to place on record their sincere appreciation for the contribution made by them during their tenure with the Company as Directors.
Key Managerial Personnel (KMP)
The details of the Key Managerial Personnel of the Company appointed pursuant to Section 203 of the Companies Act, 2013, are as follows:
Sr. No. |
Name |
Designation |
With effect from |
To |
1 |
Mrs. Visalakshi Sridhar |
Chief Financial Officer |
1st April, 2015 |
|
|
|
Manager |
28th July, 2015 |
13th August 2018 |
|
|
Company Secretary |
24th October, 2015 |
|
|
|
Managing Director |
13th August 2018 |
31st July 2021 |
Board of Directors has formulated a Nomination and Remuneration Policy, annexed hereto as Annexure B, stating the criteria for determining qualifications, positive attributes and independence of a director and recommends to the Board a policy, relating to the remuneration for the directors, key managerial personnel and other employees.
16. AUDITORS
M/s. MSKA & Associates, Chartered Accountants, Mumbai (Firm Registration No.105047W) were appointed as Statutory Auditors of the Company at the 52nd AGM held on 19th December, 2015 for a term from the conclusion of the 52nd Annual General Meeting upto the conclusion of 57th Annual General Meeting, subject to the ratification by the Members at each of the Annual General Meetings. M/s. MSKA & Associates have provided a declaration to the effect that they continue to be eligible and independent in terms of Section 141 of the Companies Act, 2013 read with Rule 10 Companies (Audit & Auditors) Rules, 2014.
Your Board recommends the ratification of appointment of M/s. MSKA & Associates as the Statutory Auditors of the Company at the 55th AGM.
(In terms the Companies Amendment Act 2017, notified on 7th May 2018, ratification of appointment of statutory auditors at every AGM is no more a legal requirement. However, as the resolution passed for appointment of the auditors states that ratification of their appointment in every Annual General Meeting, your Company has recommended their appointment.
17. PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said Rules are provided in the Annexure forming part of the Annual Report.
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure forming part of the Annual Report.
With regard to the provisions of Section 136(1), read with its relevant proviso, of the Companies Act, 2013, the Annual Report excluding the aforesaid information is being sent to the Members of the Company. The said information is available for inspection at the Registered Office and Corporate Office of the Company during working hours on all working days upto the date of AGM and any Member interested in obtaining such information may write to the Company Secretary and the same will be furnished without any fee.
18. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
Earning and Outgo.
The Company is not being engaged in manufacturing activities; hence, the particulars in respect of Conservation of Energy, Technology Absorption are not applicable to the Company.
The details of Foreign Exchange Earnings and Outgo for the Financial Year 2017-18 are as follows:
|
|
(Rs. in Lakhs) |
Particulars |
31st March, 2018 |
31st March, 2017 |
Expenditure |
|
|
Foreign Travelling Expenses |
0.78 |
2.24 |
Interest & Finance Charges on Foreign Currency Loan |
4,667.96 |
4,813.82 |
Total |
4,668.74 |
4,816.06 |
Earnings |
|
|
Advertisement and Media Services |
12.05 |
- |
Total |
12.05 |
- |
19. TRANSFER OF UNCLAIMED DIVIDENDS AND SHARES TO INVESTORS EDUCATION AND PROTECTION FUNDS (IEPF).
During the year under review, your Company has transferred a sum of Rs. 29,56,455/- to the Investors Education and Protection Fund of Central Government, in compliance with Section 125 of the Companies Act, 2013. This amount represents dividends for the financial year 2010-11 which had been lying unclaimed with the Company for a period of 7 years from the due date of the payment, despite reminders sent to concerned shareholders for claiming the amount.
Pursuant to the provisions of Section 124(6) of the Companies Act, 2013 and the Investor Education and Protection Fund Authority (Accounting, Auditing, Transfer and Refund) Rules 2016, which have come into effect from 7th September 2016, which stipulates that shares on which dividend has not been paid or claimed for seven consecutive years or more, then such shares are to be transferred to the IEPF a fund constituted by the Government of India under Section 125 of the Companies Act 2013. The Company has intimated to all such shareholders vide letter dated 15th June 2016 about the non-encashment of dividend and transfer of the shares to IEPF at the appropriate date and has transferred 487635 shares to lEPF on 28th December, 2017. Details of shares transferred to IEPF have been uploaded on to the Company''s website.
The Company has intimated to all such shareholders vide letter dated 31st July 2018 about the non-encashment of dividend warrants for last seven years commencing from 2010-2011 and eventual transfer of the shares to IEPF after 24th August 2018 in the event of non-encashment of dividend. Details of shareholders who have not encashed dividend has been uploaded on to the Company''s website.
After the shares have been transferred to IEPF the shareholders can claim the said shares from IEPF authorities by filing e-form No. IEPF-5, as prescribed under the Investor Education and Protection Fund Authority (Accounting, Auditing, Transfer and Refund) Rules 2016.
20. MEETINGS OF THE BOARD
During the year under review 5 meetings of the Board of Directors were held. The details such as the dates of meetings, attendance of the Directors thereat etc. are provided in Report on Corporate Governance, which forms part of this Report.
21. PERFORMANCE EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and SEBI (LODR) Regulations 2015, Independent Directors at their meeting without the participation of the Non-independent Directors and Management, considered/evaluated the Boards'' performance, Performance of the Chairman and other Non-independent Directors. The Board have undergone a formal review which comprised Board effectiveness survey, 360 degree and review of materials. This resulted in a full Board effectiveness report and Directors'' feedback. This is further supported by the Chairman''s Annual Director
Performance Review. The Board subsequently evaluated its own performance, the working of its Committees (Audit, Nomination and Remuneration and Stakeholders Relationship Committee) and Independent Directors (without participation of the relevant Director). The criteria for performance evaluation have been detailed in the Corporate Governance Report.
22. VIGIL MECHANISM / WHISTLE BLOWER POLICY
Pursuant to Section 177(9) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and SEBI (LODR) Regulations, the Board of Directors had approved the Policy on Vigil Mechanism/ Whistle Blower and the same was hosted on the website of the Company. This Policy inter-alia provides a direct access to the Chairman of the Audit Committee. Your Company hereby affirms that no Director/ employee has been denied access to the Chairman of the Audit Committee and that no complaints were received during the year. The said policy has been disclosed on the website of the Company and can be accessed at http://binaniindustries.com/investor-relations/binani-industriesltd/company-policie-codes/
23. AUDIT COMMITTEE
The Audit Committee constituted by the Board complies with the requirements under the Act as well as LODR Regulations. The details with respect of the composition of the Audit Committee are included in the Corporate Governance Report, which forms part of this Report.
There was no recommendation of the Audit Committee which were not accepted by the Board.
24. SECRETARIAL AUDITORS
Pursuant to the provision of Section 204 of the Companies Act, 2013 and Rules made there under, the Company had appointed M/s Uma Lodha & Co., Company Secretaries (CP No.2593) to carry out Secretarial Audit of the Company for the Financial Year 2017- 18. The Secretarial Auditor Report which does not contain any observations or qualifications is annexed to this Report as Annexure C and forms part of the Board''s Report.
25. EXTRACT OF ANNUAL RETURN
An extract of the Annual Return in the prescribed format MGT-9 as required under Section 92 of the Companies Act, 2013 is appended as Annexure D to this Report.
26. INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY
Given the nature of business and size of operations, your company''s internal control system has been designed to provide for
a. Accurate recording of transactions with internal checks and prompt reporting.
b. Adherence to applicable Accounting Standards and Policies.
c. Compliance with applicable statutes, policies and management policies and procedures.
d. Effective use of resources and safeguarding of assets.
The Internal Control Systems provides for well documented policies / guidelines, authorisation and approval procedures. Your Company through a firm of Chartered Accountants carried out periodic audits on all functions based on the plan and brought out any deviation to the Internal Control Procedures. The observations arising out of the audit are periodically reviewed and compliance ensured. The summary of Internal Audit observations and status of implementation are submitted to the Audit Committee. The status of implementation of the recommendations is reviewed by the Audit Committee on a regular basis and concerns, if any, are reported to the Board.
27. RISK MANAGEMENT
The Company had identified certain risk areas with regard to the operations of the Company which was facilitated by a renowned firm of consultants in Mumbai. The Internal Auditors review the steps taken for risk mitigation / minimization wherever ever possible and the status of the same is reviewed by the Audit Committee periodically. The Company''s Board is conscious of the need to periodically review the risks mitigation process.
28. POLICY FOR PREVENTION OF SEXUAL HARASSMENT
The Company has adopted a policy for prevention, prohibition and redressal of Sexual harassment. Pursuant to the provisions of sexual Harassment of Women at Work Place (Preventions, Prohibition & Redressal) Act, 2013. The Policy has been placed on the website of the Companywww.binaniindustries.com.
During the year under review, no complaints were received by the Company, pursuant to the aforesaid Act/ Policy.
29. CORPORATE GOVERNANCE
Your Company is fully compliant with the Corporate Governance guidelines, as laid out in applicable regulations of LODR Regulations. All the Directors (and also the members of the Senior Management) have affirmed in writing their compliance with and adherence to the Code of Conduct adopted by the Company. The Corporate Governance Report is attached as Annexure E to this Report.
The Chief Financial Officer has given a certificate of compliance with the Code of Conduct, which forms part of Corporate Governance Report as Annexure F required under SEBI LODR Regulations.
M/s Uma Lodha & Co., Practising Company Secretary have certified compliance with Corporate Governance clauses of erstwhile Listing Agreement and LODR Regulations and the Certificate in this regard is attached as Annexure G to this Report.
The Chief Financial Officer (CFO) certification as required under erstwhile Clause 41 of the Listing Agreement and Regulation 8(17)
of LODR Regulations is attached and forms part of this Report Annexure H. Related Party disclosures/transactions are detailed in Notes to the financial statements
30. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Braj Binani Group, through its operating Indian Subsidiaries, undertake the activities on an ongoing basis for upliftment of the weaker sections and welfare of the society.
Your Board has constituted a Corporate Social Responsibility Committee (CSR Committee) pursuant to the provisions of Section 135 of the Companies Act, 2013 read with Rules made there under. However, your Company is not obliged to spend any amount on CSR activities under the aforesaid provisions of the Act based on the criteria laid down therein.
1 |
A Brief outline of the Company''s CSR policy, including overview of projects or programs proposed to be undertaken and a reference to the weblink to the CSR policy and projector programs. |
The Company by its CSR Activities has committed to participate in Social cause, be it uplifting the weaker section of the society or communal developments. The key focus area of the Company''s CSR activities are one or more from amongst the activities specified under schedule VII of the Companies Act, 2013 and Rules made thereunder. The Company''s CSR initiatives shall be integrated with its business practices with an overall objective of the growth and development of the society and the Country The CSR Policy of the Company is available at the company''s website |
2 |
The Composition of the |
Mr. Nilesh R Doshi - Chairman |
|
CSR Committee. |
Mr. Shardul D. Shah - Member |
|
|
Mr. Rajesh Kumar Bagri - Member |
|
|
Mrs. Visalakshi Sridhar - Member |
3 |
Average net profit of the Company for last three financial years |
-ve (refer notes to the Audited Accounts) |
4 |
Prescribed CSR Expenditure (two per cent of the amount as in item 3 above). |
-ve |
5 |
Details of CSR spent during the financial |
Not applicable in view of point 3 above |
|
year: a) Total amount to be spent for the financial |
|
|
year b) Amount unspent, if |
|
|
any; c) Manner in which the |
|
|
amount spent during the financial year is detailed below |
|
6 |
Reason for shortfall in spend |
Not applicable |
7 |
Responsibility statement of the CSR Committee |
We hereby confirm that the implementation and monitoring of CSR Policy, is in compliance with CSR objectives and CSR policy of the Company |
Goa Glass Fibre Limited (GGFL)
The provisions of Section 135 of the Companies Act, 2013 and Rules there under with respect to CSR are presently applicable to the Company. In the year 2017-18 the CSR expenditure required by the Company was Rs. 27.94 Lakhs, being 2% of the average net profits of the Company for the preceding three financial years However due to paucity of time; the Company could spend Rs. 26.56 Lakhs on CSR activities by undertaking operations and surgeries for the poor, conducting blood donation camps, promoting education and providing infrastructural support to local schools besides contributing to PM''s National Relief Fund, Clean Ganga Fund and Swach Bharat Kosh. The shortfall of Rs.1.38 Lakhs in CSR spending was however spent by the Company in the month of April 2018. (2018-19).
BIL Infra tech Limited
BIL Infratech Ltd., the wholly owned subsidiary of Binani Industries Limited had taken an important steps in the year 2017-18 to strengthen and enhance its footprint in the adjoining areas where the Company is currently executing its flagship projects at:
1. Budge Budge (WBIDC''s Garment Park project) and
2. New Town, Rajarhat (NBCC-NICL Project).
At the same time Company wishes to explore opportunities and further expand to new focus areas aiming at community development around its areas of operation.
The initiatives adopted by the company were sustainable development in the areas of Health Care & safe and clean Drinking Water. The Company identified the beneficiaries on the basis of extensive survey made by the CSR initiatives Executing Partner NIRVANA FOUNDATION and accordingly finalised its social outreach while complying with its CSR mandate as per Companies Act, 2013.
The Company had taken up numerous CSR initiatives in collaboration with an NGO, Nirvana Foundation, in the vicinity of Budge Budge and Pujali Municipal area. The Company had adopted a focused and structured approach towards implementing its CSR initiatives and were addressing the need of Children studying in Govt. Schools of Rajibpur High School, Kalipur Girls High School and Pujali Shikshayatan. Most of the children studying in those schools were coming from BPL families and they were the first generation learners. The Company had recently installed RO Filtration plant for safe and clean drinking water and Sanitary Napkin Vending Machines in those schools. Inauguration ceremony of RO Plants and Vending Machines were held by Chairperson of Pujali Municipality, in the presence of Managing Director of BIL Infratech Ltd., Members of Nirvana Foundation and School Authorities. Besides, numerous free health check-up camps and distribution of spectacles after eye check-up were organized by the Company in Budge Budge and Rajarhat area.
As per provisions of section 135 and other applicable provisions of the Companies Act,2013 the Company is required to spend Rs. 19.93 lakhs during the financial year 2017-18, but the Company had spent Rs. 21.86 Lakhs on above CSR activities under the head 1) Promoting health care including preventive health care under clause I of Schedule VII of the Companies Act, 2013 (''Act'').
31. OTHER DISCLOSURES
Your Directors state that no disclosures or reporting is required in respect of the following items, as the same is either not applicable to the Company or relevant transactions / event have not taken place during the year under review.
a. Issue of Equity shares with differential rights as to dividend, voting or otherwise.
b. Issue of shares (including sweat equity shares) to employees of the Company under any scheme.
c. Except for the one stated above no significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.
32. HUMAN RESOURCES
Across the Companies in the Group, Employee Relation continues to remain cordial. The Group''s emphasis on safe work practices and productivity improvement is unrelenting.
As per Section 197 of the Companies Act, 2013 read with Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the median remuneration of our employees as at March 31, 2018 is Rs.5,90,769.
The Company had 31 permanent employees on its rolls as on March 31, 2018. The Board places on record its sincere appreciation for the valuable contribution made by the employees across all levels in the organization.
33. CAUTIONARY STATEMENT
Statements made in this Report, describing the company''s objectives, projections, expectations and estimates regarding future performance may be "forward looking statements" within the meaning of applicable laws and regulations and are based on currently available information. The Management believes them to be true to the best of its knowledge at the time of preparation of this Report. However, these statements are subject to future events and uncertainties which inter-alia include regulatory changes, tax laws, economic developments within the Country and other incidental factors, that could cause actual results to differ materially from those as may be indicated under such statements.
34. ACKNOWLEDGEMENTS
The Directors wish to express their appreciation for the continued co-operation of the Central and State Governments, bankers, financial institutions, customers, dealers and suppliers and also the valuable assistance and advice received from the joint venture partners, and all the shareholders. The Directors also wish to thank all the employees for their contribution, support and continued cooperation throughout the year.
|
For and on behalf of Board of Directors of |
|
|
Binani Industries Ltd. |
|
|
Visalakshi Sridhar |
|
|
Managing Director, CFO & Company Secretary |
|
|
DIN: 07325198 |
|
|
Membership No.lCSI-A13849 |
|
|
AICWA-M2113 |
|
Date: 23rd November, 2018 |
|
|
Place: Mumbai |
|
|
ANNEXURE A
FORM NO.AOC-2
(Pursuant to clause (h) of sub-section (3) of Section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014)
Particulars of contracts/arrangements entered into by the Company with related parties referred to in sub-section (1) of Section 188 of the Companies Act, 2013 including certain arm''s length transactions under third proviso thereto
Details of contracts or arrangements or transactions at Arm''s length basis.
Name (s) of the related party & nature of relationship |
Binani Cement Limited (BCL) Nature of relationship - subsidiary. BCL was admitted under the Corporate Insolvency Resolution Process w.e.f July 25, 2017. |
Nature of contracts/arrangements/transaction |
Providing of Transportation & other Logistic Services |
Duration of the contracts/arrangements/transaction |
1st April, 2017 to 24th July 2017 |
Salient terms of the contracts or arrangements or transaction including the value, if any |
Providing of transportation and logistics solutions on day to day basis at the BCLs manufacturing plants. The value of transaction for financial year 2017-18 was Rs.12327 Lakhs. |
Date of approval by the Board |
Up to 31st December, 2014, the services were provided pursuant to the contract dated 16th March, 2012. Post 1st January, 2015, the services were provided in accordance with generally accepted commercial practices. |
Amount paid as advances, if any |
Nil |
Details of modifications to contracts or arrangements or transactions being modifications not at arm''s length basis:
The details of the contracts or arrangements or transactions which were earlier on arms length but varied to suit business requirements is as follows:-
Name(s) of the related party |
Edayar Zinc Ltd. |
Binani Cement Limited |
|
Nature of relationship |
Subsidiary |
Subsidiary |
Subsidiary (as inducted into the Corporate Insolvency Resolution Process w.e.f July 25, 2017) |
Nature of contracts/ arrangements/ transactions |
Mr. R.S. Joshi who is employed as Executive Director in the Company was appointed in EZL as Managing Director. He resigned as Managing Director of EZL on 24th January 2018 |
Mr. Saurabh Tiwari, who is employed as Officer in the Company was appointed as Company Secretary of EZL. He resigned from the Company on 24th October 2017. |
Mr. Umesh Lathi, who was employed as Chief Commercial Officer was appointed as Chief Financial Officer w.e.f. May 29, 2017 till 31st December, 2017. |
Duration of the contracts / arrangements/ transactions |
From 29th September, 2016 till 24th January 2018. |
From 27th October, 2016 till 24th October 2017. |
May 29, 2017 till 31st December, 2017. |
Salient terms of the contracts or arrangements or transactions including the value, if any |
There were no variation in the existing contract There were no provision of recovery of remuneration paid to Mr. Joshi from EZL |
There were no variation in the existing contract There were no provision of recovery of remuneration paid to Mr. Saurabh Tiwari from EZL |
There were no variation in the existing contract. There were no provision of recovery of remuneration paid to Mr. Umesh Lathi from BCL. |
Justification for Variation done in contract during the year |
No variation made from entering into the transaction with the subsidiary. |
No variation made from entering into the transaction with the subsidiary. |
No variation made from entering into the transaction with the subsidiary |
Date(s) of approval by the Board |
29th July, 2016 |
27th October, 2016 |
May 29, 2017 |
Name(s) of the related party |
Edayar Zinc Ltd. |
Binani Cement Limited |
|
Nature of relationship |
Subsidiary |
Subsidiary |
Subsidiary (as inducted into the Corporate Insolvency Resolution Process w.e.f July 25, 2017) |
Amount paid as advances, if any |
Nil |
Nil |
Nil |
Date on which the special resolution was passed in general meeting as required under first proviso to Section 188 |
Not Applicable |
Not Applicable |
Not applicable |
|
For and on behalf of Board of Directors |
|
of Binani Industries Limited |
|
Visalakshi Sridhar |
|
Managing Director, CFO & Company Secretary |
|
DIN: 07325198 |
|
Membership No.lCSI-A13849 |
|
AICWA-M2113 |
Date: 23rd November, 2018 |
|
Place: Mumbai |
|
Mar 31, 2016
Dear Members,
The Directors present the Fifty Third Annual Report of the Company together with the Audited Financial Statements for the Financial Year ended 31st March, 2016
1. FINANCIAL HIGHLIGHTS
(Rs. in Lacs)
Particulars |
31st March, 2016 |
31st March, 2015 |
Total Income |
52513.62 |
5514.21 |
Finance Costs |
4620.81 |
18459.17 |
Depreciation & Amortization |
265.96 |
177.25 |
Transfer from Business Reorganization Reserve |
(8841.05) |
(19802.74) |
Profit/(Loss) before Tax & Exceptional items |
1647.68 |
1204.79 |
Less: Tax expense (current tax and tax on earlier years) |
(21.20) |
|
Less: Deferred tax Asset |
34.43 |
- |
Profit after Tax |
1634.45 |
1204.79 |
Transfer to General Reserve |
- |
(121.00) |
Reversal of undeclared dividend and Dividend Distribution tax of 2014-15 |
1068.65 |
|
Proposed Dividend |
Nil |
(887.90) |
Dividend distribution Tax |
Nil |
(180.75) |
*brought forward from last year |
1922.52 |
(1988.65) |
Transferred from General Reserve |
- |
121.00 |
Profit/(Loss) carried to balance sheet |
1922.52 |
(1872.33) |
*Includes Rs.1,091.75 Addition during the period pursuant to Scheme of Amalgamation
2. REVIEW OF OPERATIONS
Your Company is engaged in the business of providing logistics solutions, media, publication services, trading in shares and securities and trading and export of goods and management support services and has also sub-licensed to its major subsidiaries for use of its Intellectual Property Rights such as Brand, Logo & Trade Mark etc. The Board of Directors of the Company (âBoard") has not charged any fees for management support services and royalty to all its subsidiaries during the current year.
For the year under review, your Company earned a Total Income of Rs.52514 Lacs as against Rs.5514 Lacs in the previous year. The Total Income for the year 2015-16 was significantly higher on account of Amalgamation of Binani Metals Limited with the Company effective April 01, 2015 (Appointed Date). This resulted in the Company earning Profit after Tax of Rs.1634 Lacs as against Rs.1205 Lacs in the previous year after transfer of sum of Rs.8841 Lacs from Business Re-organization Reserve as against Rs.19803 Lacs last year.
3. DIVIDEND
Considering the present financial position of the Company, the Board of Directors do not recommend dividend for the financial year 2015-16.
4. RESERVES
No amount is proposed to be transferred to Reserves.
5. SHARE CAPITAL
During the financial year under review, there have been no changes in the Authorized, Issued, Subscribed and Paid-up Share Capital of the Company.
6. SCHEME OF AMALGAMATION
Pursuant to the approval of Scheme of Amalgamation of Binani Metals Limited (BML) with the Company by the Hon''ble High Court of Judicature at Kolkata vide its order dated 21st January, 2016, the Scheme became effective on 5th April, 2016.
The Board of Directors at its meeting held on 21st April, 2016 approved issue of :-
- 17,71,600 Equity Shares of Rs.10/- each to the eligible shareholders of BML as on 22nd April, 2016 the record date fixed for the said purpose
- 2,98,000 0.01% Non-cumulative Redeemable Preference Shares of Rs.100/- each to Preference Share holders of BML
The Board at its above-mentioned meeting constituted Share Allotment Committee for the purpose of allotment of Equity and Preference Shares to Shareholders of BML.
Consequent upon allotment of following shares by the Allotment Committee at its meeting held on 29th April, 2016, the Authorized, Issued, Subscribed and Paid-up Capital of the Company stands increased as below:-
1 |
Authorized Share Capital |
4,40,00,000 Equity Shares of Rs.10/- each |
|
1,24,00,000 Preference Shares of Rs.100/- each |
|
2 |
Issued Share Capital |
3,13,68,025 Equity Shares of Rs.10/- each |
|
1,22,98,000 Preference Shares of Rs.100/- each |
|
3 |
Subscribed and Paid up Capital |
3,13,66,175 Equity Shares of Rs.10/- each |
|
1,22,98,000 Preference Shares of Rs.100/- each |
7. CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the provisions of sub-section (3) of section 129 of the Companies Act 2013 and the SEBI Listing Obligation Disclosure Requirements) Regulations, 2015, the Consolidated Audited Financial Statements of the Company including the financial details of all the subsidiary companies of the Company forms part of this Annual Report. The Consolidated Financial Statements have been prepared in accordance with applicable Accounting Standards prescribed under Section 133 of the Companies Act 2013.
8. DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of clause of sub-section (3) and subsection (5) section 134 of the Companies Act 2013 (''the Act'') your Board of Directors state and confirm that:-
a. In the preparation of the annual financial statements for the year ended March 31, 2016, the applicable Accounting Standards read with requirements set out under Schedule III to the Act, have been followed and proper explanation relating to material departures, if any, has been furnished;
b. they have selected such accounting policies as listed in the Note 2 to the Financial Statements and have applied them consistently and prudent judgments & estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2016 and of the profits of the Company for the financial year ended on that date;
c. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of ''the Act'' for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. they have prepared the annual accounts for the financial year ended on March 31, 2016 on a going concern basis.
e. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively and
f. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
9. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
1. Edayar Zinc Limited (EZL) subsidiary of the Company was referred to Board for Industrial and Financial Reconstruction (BIFR) for determination of sickness. During the year under review, the matter pending before BIFR for determination of sickness of the Company could not see much progress due to intermittent sitting of BIFR. EZL has already applied to BIFR seeking, inter alia, urgent listing of the main case and declaration of the Company as a sick company under Section 22(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 (SICA) and appoint an operating agency for formulation of draft rehabilitation scheme.
Since the plant was not operational for sanction of suitable revival and rehabilitation package for a considerable length of time and there was no possibility of resumption of operation in the immediate future, the Company retrenched its management staff during June 2015 and applied to State Government of Kerala for closure of plant to facilitate revival of business. EZL has moved for adjudication.
During the third quarter of the year under review, the Secured Creditors initiated the action under Section 13(4) of The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act 2002) for recovery of their dues and has issued notice of taking symbolic possession. EZL is in the process of making an application to the Debt Recovery Tribunal seeking, inter alia, to set aside the notice under section 13(4) of SARFAESI Act, 2002. EZL has also challenged the notice received from the banks for declaration of the Company as a willful defaulter.
EZL is hopeful that Creditors and Authorities will take measured stand to safeguard interest of all stakeholders by allowing EZL to revive under a suitable revival package.
2. Your subsidiary B T Composites Limited is in the process of voluntary liquidation and has appointed Mrs. Sara Sancheti, a Company Secretary in Whole Time Practice as the liquidator of the Company. The procedure for voluntary liquidation is underway.
10. PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED
During the year under review, the loans given, investments made and Guarantees given and securities provided under Section 186 of the Companies Act 2013 are given in the Notes to the Standalone Financial Statements.
11. CONTRACTS OR ARRANGMENTS WITH RELATED PARTIES
All transactions entered into by the Company with related parties were in the ordinary course of business and at arm''s length. The Audit Committee from time to time reviewed and approved the said transactions. Disclosures as required under AS- 18 have been made in Notes to the Financial Statements.
The Company has not entered into any fresh material contracts with any of the related parties during the year under review. The details of existing Related Party Contracts/Arrangements, modified during 2015-16, are provided as Annexure A to this report in Form AOC-2
12. DEPOSIT
The Company has not accepted any deposit from the public within the meaning of sub-section (31) of section 2 and Section 73 of the Companies Act, 2013 and Rules framed there under.
13. OUTLOOK
The year 2015-16 has been a year of mixed bag for the Group. BCL suffered set back as the industry continued to go through a phase of poor demand scenario. The Company paid almost the entire principal demand to the Rajasthan VAT Authorities (RVAT) in connection with the past dues which were in dispute. With improvements in demand, the year 2016-17 is expected to be a good year.
EZL operations were shut for the entire year and as explained above, EZL is hopeful that Creditors and Authorities will take measured stand to safeguard interest of all stakeholders by allowing EZL to revive under a suitable revival package.
The Group''s Glass Fibre business, both in India and abroad have shown considerable improvement for the year under review. Improved business conditions in European Markets with several measures undertaken to improve efficiency across different operating areas, resulted in significantly improved top line as well as bottom-line.
BIL Infratech Limited another subsidiary of your Company continued to report significantly improved performance though relatively smaller in volume.
14. REPORT ON SUBSIDIARY COMPANIES
In accordance with Proviso to sub-section (3) of Section 129 of the Companies Act, 2013 (âAct"), the salient features of the Financial Statements of subsidiary Companies are set out in the prescribed Form AOC - 1 which forms part of this Report. The said Financial Statements shall also be kept for inspection by the Members at the Registered Office of the Company. The Company will provide free of cost, a copy of Financial Statements in respect of its subsidiaries to any Member of the Company, upon receipt of a request for the same.
FINANCIAL HIGHLIGHTS AND BUSINESS OUTLOOK OF The Companyâs SUBSIDIARY COMPANIES
The Financial Highlights and Business Outlook in respect of the Company''s major subsidiaries are given below:-Binani Cement Limited (BCL)
Financial Highlights
Rs. in Lacs
Particulars |
2015-16 |
2014-15 |
Total Revenue |
152,425 |
183,998 |
Profit before Depreciation, Interest and Tax and Exceptional Items |
8,751 |
29,347 |
Provision for Depreciation |
6,807 |
7,471 |
Interest and Financial Charges |
36,848 |
35,325 |
Profit / (Loss) before Tax and Exceptional Items |
(34,904) |
(13,449) |
Exceptional Items |
- |
1,283 |
Provision for Tax (Deferred Tax) |
(6,007) |
(4,244) |
Profit / (Loss) after Tax |
(28,897) |
(10,488) |
Review of Operations
Demand for cement is highly correlated with cyclical activities like construction and infrastructure development. The sluggish demand of cement continued in 2015-16 and which has been further affected due to Cash Flow constraints owing to coercive measures initiated by the Rajasthan VAT Authorities, the Company could achieve production of 4.326 million MT as compared to 4.501 million MT in the Financial Year 2014-15; lower by about 4%.
Consequently, cement sales were also lower by 13% at 4.313 million MT as against 4.473 million MT in the previous year. Share of Portland Pozzolana Cement (PPC) as a percentage to total sales, reduced from 43% to 37% as per market scenario. The Cement industry has been passing through a difficult year. Due to sluggish demand, the gross sales realization (net of VAT/ CST & discount) of the Company has been lower to
Rs.4,084/ MT as compared to Rs.4,373/ MT in previous financial year. Because of the lower realization, the margins have been adversely affected.
The Hon''ble High Court at Calcutta has recalled its earlier order sanctioning the Scheme of Arrangement for hive-off of the BCL''s Power Undertaking to its wholly owned subsidiary namely Binani Energy Private Limited. and permitted to withdraw the Scheme vide its order dated 16th October, 2015.
Business Outlook Indian Cement Industry
The cement industry in India, the second-largest in the world, is a study in hope. The sector, which has been facing depressed demand, is hoping that business from government-driven projects will get their engines back into high gear. Currently, India''s cement production capacity is about 390 million tons per annum (MTPA) accounting for around 6.7% of world''s output. The cement production capacity is estimated to touch 550 MTPA by the end of 2020.
The Government of India is strongly focused on infrastructure development to boost economic growth and is aiming for 100 smart cities. It plans to increase investment in infrastructure to US$ 1 trillion in the 12th Five Year Plan (2012-17) and it is expected that the investment figure will increase significantly in next Five Year Plan. The government also intends to expand the capacity of the railways and the facilities for handling and storage to ease the transportation of cement and reduce transportation costs. These measures would lead to increased construction activity thereby boosting cement demand.
The lion''s share of cement demand is created by the housing market, which is also facing a depressed future. The good news it that the RBI is expected to lower interest rates in 2016, which could create increased housing demand. Further, government projects include the Housing for All initiative (on which it plans to spend $50 billion) and the smart city push which would help in boosting the muted growth of the cement industry. The cement market in India is expected to grow at a Compounded annual growth rate (CAGR) of 9.7% during 2006-2017.
With the positive sentiments prevailing, consequent upon a stable Government at the Centre, coupled with large planned investments in infrastructure and housing /real estate sectors, the demand for cement is likely to get a boost in the coming years. Opportunities also exist in terms of technology innovations for improving efficiency and installation of Waste Heat Recovery System.
BCL has strategized to focus on the nearby markets to optimize its logistic costs and streamline and strengthen its distribution network. In addition, the Company continues to streamline the processes with a view to bring all around efficiencies which will facilitate yielding better margin.
With Indian Economy progressing towards the growth trajectory, still economy might take some time to stabilize completely. Intense competition, over capacity situation in the regions where the Company operates coupled with expansion plans of global giants and increasing small players, will pose challenge and put pressure on the price realization.
Overall, BCL is hopeful of reporting better performance in the years ahead, barring unforeseen circumstances.
Edayar Zinc Limited (formerly Binani Zinc Limited)
Financial Highlights
Rs. in Lacs
Particulars |
2015-16 |
2014-15 |
Total Revenue |
9.04 |
113.15 |
Profit before Depreciation, Interest and Tax and Exceptional Items |
(7.06) |
(18.28) |
Provision for Depreciation |
4.01 |
8.14 |
Interest and Financial Charges |
36.36 |
25.60 |
Profit / (Loss) before Tax and Exceptional Items |
(47.44) |
(52.03) |
Exceptional Items |
- |
- |
Provision for Tax |
- |
- |
Profit / (Loss) after Tax |
(47.44) |
(52.03) |
Balance carried forward |
(145.54) |
(98.10) |
Review of Operations
During Financial Year 2015-16 (FY 2016), the Company did not operate its plant and the reference made to Board for Industrial and Financial Reconstruction (BIFR) in terms of Section 15 of the Sick Industrial Companies (Special Provisions) Act, 1985 (SICA) was pending as at the end of financial year for determination of its sickness.
During FY 2016 (âthe year under review"), total revenue was Rs.9.04 lacs as against Rs.113.15 lacs during corresponding previous FY 2015. The Company recorded negative EBIDTA of Rs.7.06 lacs in FY 2016 vis-a-vis negative EBITDA of Rs.18.28 lacs last year.
3B Binani Glass Fibre S.a.r.l (3B Binani)
Financial Highlights
In Million Euros
Particulars |
2015-16 |
2014-15 |
Total Revenue |
194.76 |
195.72 |
Profit/(Loss) before Depreciation, Interest & Tax |
39.21 |
26.71 |
Provision for Depreciation |
17.88 |
12.67 |
Interest and Financial Charges |
18.58 |
17.43 |
Loss before Tax |
(0.62) |
(28.81) |
Provision for Tax |
0.03 |
(00.40) |
Loss after Tax |
(0.66) |
(28.41) |
Review of Operations
3B Binani, on a consolidated basis, reported significant improvement in its operating performance in the year 2015-16. The strict implementation of the Profitability Improvement Plan covering all key financial drivers strongly contributed to the overall performance improvement. Solid market conditions enabled to stabilize the sales volume at a high level while recording price increases. The net loss has been reduced significantly also thanks to the impact of the unrealized foreign exchange gain (non-cash) on the IDBI debt associated with the weakening of the dollar versus last year against the Euro.
Industry Overview
The EU reinforcement market remains solid with decent growth across all segments and across the entire product line. The industry has been growing steadily above 5% over the last 3 years. In 2015, imports have reduced at the beginning of the year but then resumed with higher level later on and closed with a growing trend.
In 2016, Europe is starting with a reasonable level of shipments even if the optimism observed in 2015 has slowly transformed into more cautious expectations. Overall, the EU Wind market is still developing very well even if some OEM''s are doing better than others. China is also expected to be weaker due to a change in their support system. In Automotive, the number of cars produced is expected to grow by another 2% in 2016, which is lower than 2015 but still showing a certain level of optimism. The Indian reinforcement market remains strong and is expected to grow by another low double digit figure in 2016. The government''s push for wind energy will be the main driver for growth in the next few years. CSM is expected to grow by a high single digit figure in 2016, with railway coaches, bus body and Marine industry driving the growth.
Market outlook
3B Binani will continue to focus on its core markets Automotive, Wind and Performance Composites, supplying these markets with high quality Chopped Strands and Direct Roving products, supported by high performance specialty products like HiPer-tex⢠and CFM. 3B Binani still shows a strong focus on innovation to develop value-added products for its customers in order to deliver product differentiation, to improve the profitability and to keep ahead of competition. All 3B plants are focusing on improving their cost structure by optimizing production to reach the best efficiencies within the industry. Looking ahead, overall demand growth is expected to continue in glassfibre in both Europe and India with the economies gaining some momentum. The market growth for glassfibre in both automotive and wind applications continue to be encouraging and 3B Binani is well positioned to take advantage of this BIL Infratech Limited (BILIL)
BILIL is a wholly owned subsidiary of the Company. BILIL is engaged in execution of EPC contracts for Industrial, Civil Construction, and Power & Renewable Energy Projects. Financial Highlights
Rs. in Lacs
Particulars |
2015-16 |
2014-15 |
Total Revenue |
32640 |
31689 |
Profit before Depreciation, Interest and Tax and Exceptional Items |
1825 |
1293 |
Provision for Depreciation |
264 |
132 |
Interest and Financial Charges |
335 |
256 |
Profit / (Loss) before Tax |
1227 |
905 |
Provision for Tax |
484 |
341 |
Profit / (Loss) after Tax |
711 |
553 |
Operations Review
BILIL reported the total revenue of Rs.32640 lacs for the year under review as against Rs.31689 lacs in the previous year. It earned a decent Profit after Tax of Rs.711 lacs as compared to Rs.553 lacs in the previous year.
Industry Overview
The Year 2015-16 continued to be challenging for BILIL even though India achieved robust 7.6% GDP growth and was globally acknowledged as the world''s fastest growing economy. Plethora of opportunities predominantly in Infrastructure, Rail and Power & Renewable Energy had been visible. The Smart City Mission with assured budgetary support to create 100 Smart Cities across India had also bolstered the optimism significantly.
In spite of strong signs of economic revival with higher consumer confidence Industry and Infrastructure sector remained sluggish in general. The optimism was not translated into realistic opportunity level as it was promising to be earlier.
Outlook
Stable and visionary Government, policy reforms, strong possibility of simplified Tax regime and continuous efforts to improve Ease-of-doing-business have made India a bright spot in global investment map. Higher Govt. spending in key sectors such as Infrastructure, Rail, Road, Port, Power, robust FDI in Manufacturing and Defense production will push up growth prospect tremendously.
On-going Policy reforms, divestment of PSU stakes, relaxed FDI norms to allow foreign players in Indian Infrastructure Sector and thrust towards clean Energy and Make-in-India will create investment friendly environment and fuel growth momentum further. This will significantly drive demand in key Industry sectors like Cement, Steel, Mining and other Metals. Overall there will be high growth scenario in a wide spectrum of industries.
However there is possibility of Govt. funding target not being met. At the same time high debt levels of private Infrastructure players, cautious approach of Banks for new investment due to mounting NPAs and land acquisition issues may discourage private investment and could be potential growth decelerators. Global Composite Holdings Inc. formerly known as CPI Binani Inc. (CPI Binani)
Financial Highlights
In Million USD
Particulars |
2015-16 |
2014-15 |
Total Revenue |
- |
20.45 |
Profit before Depreciation, Interest and Tax and Exceptional Items |
(0.21) |
(0.25) |
Provision for Depreciation |
- |
2.10 |
Interest and Financial Charges |
- |
1.03 |
Profit / (Loss) before Tax |
(0.21) |
(3.39) |
Provision for Tax |
- |
2.40 |
Profit / (Loss) after Tax |
(0.21) |
(5.78) |
CPI has been incurring losses and in March 2015, it sold its assets to Core Moulding Technologies Inc USA.
B T COMPOSITES LIMITED (BTCL)
BTCL is wholly owned subsidiary of the Company and is under the process of Voluntary winding- up.
OTHER SUBSIDIARIES
Following wholly owned Subsidiaries which were incorporated 1-2 years back, are yet to commence any business activities:
a. Royalvision Projects Private Limited
b. Binani Global Cement Holdings Private Limited (Singapore) The above companies incurred marginal loss for the financial year ended 31st March, 2016. This was on account of certain routine administrative expenses incurred by them.
M/s Royalvision Concrete Private Limited and Royalvision Infratech Private Limited have been closed under Section 560 of the Companies Act, 1956 (strike off) and the guidelines issued by the Ministry of Corporate Affairs under the Fast Track Exit mode.
15. AUDIT OBSERVATIONS
The Auditors, in their Report, have made observations in connection with fair valuation of the Company''s investments done by the Company, creation of Business Re-organization Reserve (BRR) and transfer of sums to offset certain expenses/ write-offs and outstanding guarantees issued by the Company to banks and financial institutions on behalf of subsidiaries including one step down subsidiary which are significant in relation to the networth of the Company.
The Board wishes to state as follows:
a. In accordance with the accounting policies applicable to erstwhile Wada Industrial Estate Limited (WIEL) and to the Company as a successor to WIEL, being accounting policies adopted as per the Scheme of Amalgamation approved by the Hon''ble High Court at Kolkata on 18th March 2014, the Company has applied AS 30, the Accounting Standard on Financial Instruments: Recognition and Measurement, issued by the Institute of Chartered Accountants of India (ICAI), and pursuant thereto has as on March 31, 2014, being the date of conclusion of the first Accounting Year, classified the investments as âavailable for sale financial assets" and has accordingly, measured such investments at fair value as on that date (except for those investments whose fair value cannot be reliably measured, which investments in accordance with AS 30 are continued to be measured at cost and their cost is considered as the fair value). Similar treatment has been given in the current year ended March 31, 2016.
b. Similarly, in accordance with the aforesaid, the Company has withdrawn the amounts from BRR arising pursuant to the merger and adoption of AS 30 to meet the expenses like Interest and Financial Charges, Foreign Exchange Loss, Fixed Assets written-off, Value of Investments in subsidiaries written-off, expenses related to Scheme of Amalgamation and Advances to subsidiary written-off.
c. As explained above, the subsidiary companies are already working out a restructuring / resolution package with the banks and institutions and hence in the opinion of the management, the guarantees are not expected to result into any financial liability to the Company.
16. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP) DIRECTORS:
Pursuant to the provisions of Section 149 of the Act Mr. S. Sridhar and Mr. Rahul Asthana were appointed as Additional Director on May 30, 2014 and 28th September 2013 respectively and they held office until the date of the ensuing Annual General Meeting. In the 51st Annual General Meeting held on 29th September, 2014, their appointments were confirmed. They will hold office upto the conclusion of 53rd Annual General Meeting of the Company to be held in the calendar year 2016 and are not liable to retire by rotation. They have submitted a declaration that each of them continue to meet the criteria of independence as provided U/s 149(6) of the Act. The Company has received notices from a Member alongwith requisite deposit amounts proposing the appointment of Mr. S Sridhar and Mr. Rahul Asthana as Independent Directors of the Company at the ensuing Annual General Meeting. The Board has recommended the re appointment of Mr. S Sridhar and Mr. Rahul Asthana for a another period of 2 years up to the conclusion of 55th Annual General Meeting to be held in the calendar year 2018. (Refer Notice of AGM Resolution No. 5 & 6)
Mrs. Nidhi Binani Singhania retires by rotation and being eligible, has offered herself for re-appointment.
The Board of Directors appointed Dr. (Mrs.) Sangeeta Pandit as an Additional Director designated as Independent Director of the Company with effect from 21st April, 2016 in terms of provision of Section 161 of the Companies Act 2013 (''the Act''). Dr. Pandit aged about 56 years is a Chartered Accountant. She was a partner in P.D. Kunte & Co. and her work included audit, consultancy and representing clients at the Income Tax office and as counsel before the Commissioner of Income Tax and Income Tax Tribunal.
She is now in academics and obtained her PhD in Management. She is Head of Finance at Sydenham Institute of Management. She is visiting faculty in management institutes of repute in Mumbai like Jamnalal Bajaj Institute of Management Studies and Xavier''s Institute of Management Research and in US like University of Wisconsin and California State University. She was part of the start-up team of Unitedworld School of Management and BSE Management programme. She does consultancy in business strategy and involved in corporate training.
Dr. Pandit shall hold the office up to the date of ensuing Annual General Meeting. The Company has received a notice along with requisite deposit from a Member signifying its intention to propose the candidature of Dr. Pandit as an Independent Director. Your directors recommend appointment of Dr. (Mrs.) Sangeeta Pandit for a term of upto the conclusion of 55th AGM to be held in the calendar year 2018.
Dr. Pandit has given declaration that she meets the criteria of Independence laid down under Section 149(6) of the Companies Act 2013.
The Board recommends the aforesaid appointment / reappointment of the Directors. Brief profile of the Directors proposed to be appointed / re-appointed is annexed to the Notice convening ensuing Annual General Meeting.
Mrs. Jayantika Dave tendered her resignation vide her letter dated 10th March, 2016 which was received by the Company on 20th March, 2016 and was considered by the Board of Directors in their meeting held on 21st April, 2016.The Board of Directors wish to place on record their sincere appreciation for the contribution made by Mrs. Jayantika Dave during her tenure with the Company as Director. Consequently she also ceases to be member of the Audit Committee, Nomination and Remuneration Committee and Stakeholders Relationship Committee.
Consequent to the resignation of Mrs. Jayantika Dave, there were two Independent Directors and three Promoter Directors; thereby having less than 50% representation of Independent Directors. The requirement of Independent Directors in Board of Directors has been fulfilled by filling the vacancy created by the resignation of Mrs. Dave by appointment of Dr. (Mrs.) Sangeeta Pandit at the meeting of the Board of Directors held on 21st April, 2016 in compliance of Regulation 25(6) of SEBI (LODR) Regulations, 2015.
KEY MANAGERIAL PERSONNEL (KMP)
The details of the Key Managerial Personnel of the Company appointed pursuant to Section 203 of the Companies Act, 2013, are as follows:
Sr. No. |
Name |
Designation |
With effect from |
To |
1 |
Mr. K K Saraf |
Company Secretary |
1st August, 2012 |
30th September, 2015 |
2 |
Mr. Sushil Bhatter |
Manager |
1st June,2014 |
30th June,2015 |
3 |
Ms. Visalakshi Sridhar |
Chief Financial Officer, Manager Company Secretary |
1st April, 2015 28th July, 2015 24th October, 2015 |
- |
Board of Directors has formulated a Nomination and Remuneration Policy, annexed hereto as Annexure B, stating the criteria for determining qualifications, positive attributes and independence of a director and recommends to the Board a policy, relating to the remuneration for the directors, key managerial personnel and other employees.
17. AUDITORS
M/s. MZSK & Associates, Chartered Accountants, Mumbai (Firm Registration No.105047W) were appointed as Statutory Auditors of the Company at the 52nd AGM held on 19th December, 2015 for a term from the conclusion of the 52nd Annual General Meeting upto the conclusion of 57th Annual General Meeting, subject to the ratification by the Members at each of the Annual General Meetings. M/s. MZSK & Associates have provided a declaration to the effect that they continue to be eligible and independent in terms of Section 141 of the Companies Act, 2013 read with Rule 10 Companies (Audit & Auditors) Rules, 2014.
Your Board recommends the ratification of appointment of M/s. MZSK & Associates as the Statutory Auditors of the Company at the 53rd AGM.
18. PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said Rules are provided in the Annexure forming part of the Annual Report.
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure forming part of this Report.
Having regard to the provisions of Section 136(1) read with its relevant proviso of the Companies Act, 2013, the Annual Report excluding the aforesaid information is being sent to the members of the Company. The said information is available for inspection at the Registered Office and Corporate Office of the Company during working hours on all working days (except Saturdays) upto the date of AGM and any member interested in obtaining such information may write to the Company Secretary and the same will be furnished without any fee.
19. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO.
The Company is not being engaged in manufacturing activities, hence, the particulars in respect of Conservation of Energy, Technology Absorption are not applicable to the Company.
The details of Foreign Exchange Earnings and Outgo for the Financial Year 2015-16 are as follows:
Rs. in Lacs
Foreign Exchange Outgo |
Amount |
|
Foreign Travelling Expenses |
0.27 |
|
Interest & Finance Charges on Foreign Currency Loan |
4,460.63 |
|
TOTAL |
4,460.90 |
|
Foreign Exchange Earning |
Amount |
|
Export Sales (FOB) |
85.31 |
|
Advertisement and Media Services |
10.21 |
|
TOTAL |
95.52 |
20. TRANSFER OF UNCLAIMED DIVIDENDS TO INVESTORS EDUCATION AND PROTECTION FUNDS (IEPF).
During the year under review, your Company has transferred a sum of Rs.27,96,432 to the Investors Education and Protection Fund of Central Government, in compliance with Section 205C of the Companies Act, 1956. This amount represents dividends for the financial year 2008-09 which had been lying unclaimed with the Company for a period of 7 years from the due date of the payment, despite reminders sent to concerned shareholders for claiming the amount.
21. MEETINGS OF THE BOARD
During the year under review 6 meetings of the Board of Directors were held. The details such as the dates of meetings, attendance of the Directors thereat etc are provided in Report on Corporate Governance, which forms part of this Report.
22. PERFORMANCE EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and LODR Regulations, Independent Directors at their meeting without the participation of the Non-Independent Directors and Management, considered/evaluated the Boards'' performance, Performance of the Chairman and other Non-independent Directors. The Board have undergone a formal review which comprised Board effectiveness survey, 360 degree and review of materials. This resulted in a full Board effectiveness report and Directors'' feedback. This is further supported by the Chairman''s Annual Director Performance Review. The Board subsequently evaluated its own performance, the working of its Committees (Audit, Nomination and Remuneration and Stakeholders Relationship Committee) and Independent Directors (without participation of the relevant Director). The criteria for performance evaluation have been detailed in the Corporate Governance Report.
23. Vigil Mechanism/ Whistle Blower Policy
Pursuant to Section 177(9) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and LODR Regulations, the Board of Directors had approved the Policy on Vigil Mechanism/ Whistle Blower and the same was hosted on the website of the Company. This Policy inter-alia provides a direct access to the Chairman of the Audit Committee. Your Company hereby affirms that no Director/ employee has been denied access to the Chairman of the Audit Committee and that no complaints were received during the year. The said policy has been disclosed on the website of the Company and can be accessed at http://binaniindustries. com/investor-relations/binani-industries-Limited/company-policies-codes/
24. AUDIT COMMITTEE
The Audit Committee constituted by the Board complies with the requirements under the Act as well as LODR Regulations. The details with respect of the composition of the Audit Committee are included in the Corporate Governance Report, which forms part of this Report.
There was no recommendation of the Audit Committee which were not accepted by the Board.
25. SECRETARIAL AUDITORS
Pursuant to the provision of Section 204 of the Companies Act, 2013 and Rules made there under, the Company had appointed M/s Uma Lodha & Co., Company Secretaries (CP No.2593) to carry out Secretarial Audit of the Company for the Financial Year 2015-16. The Secretarial Auditor Report is annexed to this Report as Annexure C.
26. EXTRACT OF ANNUAL RETURN
An extract of the Annual Return in the prescribed format MGT-9 as required under Section 92 of the Companies Act, 2013 is appended as Annexure D to this Report.
27. INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY
Given the nature of business and size of operations, your company''s internal control system has been designed to provide for
a. Accurate recording of transactions with internal checks and prompt reporting.
b. Adherence to applicable Accounting Standards and Policies.
c. Compliance with applicable statutes, policies and management policies and procedures.
d. Effective use of resources and safeguarding of assets.
The Internal Control Systems provides for well documented policies / guidelines, authorization and approval procedures. Your Company through a firm of Chartered Accountants carried out periodic audits on all functions based on the plan and brought out any deviation to the Internal Control Procedures. The observations arising out of the audit are periodically reviewed and compliance ensured. The summary of Internal Audit observations and status of implementation are submitted to the Audit Committee. The status of implementation of the recommendations is reviewed by the Audit Committee on a regular basis and concerns, if any, are reported to the Board.
28. RISK MANAGEMENT
The Company had identified certain risk areas with regard to the operations of the Company which was facilitated by a renowned firm of consultants in Mumbai. The Internal Auditors review the steps taken for risk mitigation/ minimization wherever ever possible and the status of the same is reviewed by the Audit Committee periodically. The Company''s Board is conscious of the need to periodically review the risks mitigation process.
29. ANTI SEXUAL HARASSMENT POLICY
The Company has adopted a an Anti Sexual Harassment Policy or a policy for prevention, prohibition and redressal of Sexual harassment. pursuant to the provisions of sexual harassment of women at work place (Preventions, Prohibition & Redressal) Act, 2013. The Policy has been placed on the website of the Company www.binaniindustries.com.
During the year under review, no complaints were received by the Company, pursuant to the aforesaid Act / Policy.
30. CORPORATE GOVERNANCE
Your Company is fully compliant with the Corporate Governance guidelines, as laid out in erstwhile Clause 49 of the Listing Agreement and applicable regulations of LODR Regulations. All the Directors (and also the members of the Senior Management) have affirmed in writing their compliance with and adherence to the Code of Conduct adopted by the Company. The Corporate Governance Report is attached as Annexure E to this Report.
The Chief Financial Officer has given a certificate of compliance with the Code of Conduct, which forms part of Corporate Governance Report as Annexure F required under SEBI LODR Regulations.
M/s Uma Lodha & Co., Practising Company Secretary have certified compliance with Corporate Governance clauses of erstwhile Listing Agreement and LODR Regulations and the Certificate in this regard is attached as Annexure G to this Report.
The Chief Financial Officer (CFO) certification as required under erstwhile Clause 41 of the Listing Agreement and Regulation 8)17) of LODR Regulations is attached and forms part of this Report (Annexure H). Related Party disclosures/transactions are detailed in Notes to the financial statements
31. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Braj Binani Group, through its operating Indian Subsidiaries, undertake the activities on an ongoing basis for upliftment of the weaker sections and welfare of the society.
Your Board has constituted a Corporate Social Responsibility Committee (CSR Committee) pursuant to the provisions of Section 135 of the Companies Act, 2013 read with Rules made there under. However, your Company is not obliged to spend any amount on CSR activities under the aforesaid provisions of the Act based on the criteria laid down therein.
BINANI CEMENT LIMITED (BCL)
The Braj Binani Group, for several years, spends considerable amount on an ongoing basis through its operating companies, for social cause and upliftment and welfare of the weaker section of the society and on education of the underprivileged children.
In accordance with the provisions of Section 135 read with Schedule VII of the Companies Act, 2013, the Company, as a part of its initiative under the âCorporate Social Responsibility" drive, has adopted a CSR Policy outlining various CSR activities to be undertaken by the Company in the area of preventive health care, making available safe drinking water, promoting education, ensuring environmental sustainability etc. The CSR policy of the Company can be accessed on the Company''s weblink http://www.binanicement.in/investor-relations.
Edayar Zinc Limited (EZL)
The Braj Binani Group, through its operating Indian Subsidiaries, undertakes the activities on an ongoing basis for upliftment of the weaker sections and welfare of the society.
The mandatory provisions of Section 135 of the Act, and Rules made there under, with respect to Corporate Social Responsibility, are not applicable to EZL. The Company is socially conscious about its participative role in development of society. The Group continues to undertake CSR activities in Binanipuram where the plant is situated and the same are well appreciated by the local community at large.
Goa Glass Fibre Limited (GGFL)
The provisions of Section 135 of the Companies Act, 2013 and Rules there under with respect to CSR are presently not applicable to the Company. However as a part of Corporate Social Responsibility, educational program with respect to safety, health and environment was organized in nearby village Colvale where the Company also conducted free medical camps.
32. OTHER DISCLOSURES
Your Directors state that no disclosures or reporting is required in respect of the following items, as the same is either not applicable to the Company or relevant transactions / event have not taken place during the year under review.
a. Issue of Equity shares with differential rights as to dividend, voting or otherwise.
b. Issue of shares (including sweat equity shares) to employees of the Company under any scheme.
c. The Managing Director of the Company has not received any remuneration or commission from any of its subsidiaries.
d. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.
33. RECOGNITION AND REWARDS
The Company''s Subsidiaries both in India and abroad have been rewarded by prestigious Bodies / Government in recognition of various initiatives taken by them. Some of them are as follows:-Binani Cement Limited
During the year Binani Cement Limited was honoured to receive the following awards.
- Best Quality Excellence 2014-15
- Second Best Environmental Excellence in Limestone Mines 2014-15
- Second Best Environmental Excellence in Plant Operation 2014-15
- Best Environmental Excellence in Plant operation 2013-14
- Second Best Environmental Excellence in Limestone Mines 2013-14
- Second Best Quality Excellence 2013-14
34. HUMAN RESOURCES
Across the Companies in the Group, Employee Relation continues to remain cordial. The Group''s emphasis on safe work practices and productivity improvement is unrelenting.
The Company had 33 permanent employees on its roll as on March 31, 2016. The Board places on record its sincere appreciation for the valuable contribution made by the employees across all levels in the organization.
35. CAUTIONARY STATEMENT
Statements made in this Report, describing the Company''s objectives, projections, expectations and estimates regarding future performance may be âforward looking statements" within the meaning of applicable laws and regulations and are based on currently available information. The Management believes them to be true to the best of its knowledge at the time of preparation of this Report. However, these statements are subject to future events and uncertainties which inter-alia include regulatory changes, tax laws, economic developments within the Country and other incidental factors, that could cause actual results to differ materially from those as may be indicated under such statements.
36. ACKNOWLEDGEMENTS
The Directors wish to express their appreciation for the continued co-operation of the Central and State Governments, bankers, financial institutions, customers, dealers and suppliers and also the valuable assistance and advice received from the joint venture partners, and all the shareholders. The Directors also wish to thank all the employees for their contribution, support and continued co-operation throughout the year.
For and on behalf of Board of Directors of
Binani Industries Limited.
Braj Binani
Chairman
Date : 29th July, 2016
Place: Mumbai
Mar 31, 2015
Dear Members,
The Directors present the Fifty-Second Annual Report of the Company
together with the Audited Financial Statements for the Financial Year
ended 31st March, 2015
1. FINANCIAL HIGHLIGHTS
(in Lacs)
Particulars Year ended Year ended
31st March,
2015 31st March,
2014
Total Revenue 5,514 13,264
Finance Costs 18,459 26,818
Depreciation & 177 127
Amortisation
Transfer from Business (19,803) (28,852)
Reorganisation Reserve
Profit/(Loss) before tax 1,205 1,960
Profit after tax 1,205 1,960
Loss pursuant to - (506)
Amalgamation of a
Subsidiary Company
Transfer to General (121) (196)
Reserve
Proposed Dividend (888) (888)
Dividend Distribution Tax (181) (151)
(Loss) brought forward (1,989) (2,404)
from last year
Transferred from General 121 196
Reserve
(Loss) carried to Balance (1,872) (1,989)
Sheet
2. REVIEW OF OPERATIONS
Your Company, being a Holding Company, has no manufacturing activities.
It provides management support services and also sub-licensed its
Intellectual Property Rights to its major subsidiaries for use such as
Brand, Logo & Trade Mark etc. Its main revenue stream was from
management support service charges and royalty from its major
subsidiaries and dividend, if any, from investments. The Company has
not charged any fees for management support services and royalty to all
its subsidiaries except Binani Cement Limited (BCL) in the year under
review. In case of BCL, the Board of Directors has not charged any fees
for management support services and royalty for the year with effect
from 13th December, 2014.
For the year under review, your Company earned Total Income of Rs. 5,514
Lacs as against Rs. 13,264 Lacs in the corresponding previous year. The
Total Income for the year 2014-15 was significantly lower on account of
not charging of management support service fees and royalty for the
whole / part of the year. This resulted in the Company earning Profit
After Tax of Rs. 1,205 Lacs during year 2014-15 as against Rs. 1,960 Lacs
in the previous year after transfer of sum of Rs. 19,803 Lacs from
Business Re-organisation Reserve as against Rs. 28,852 Lacs last year.
Your Directors had approached the Registrar of Companies (ROC), West
Bengal (Kolkata) for extension of time to hold the Annual General
Meeting for the year under review. The ROC had granted the extension
till 28th December, 2015.
3. DIVIDEND
Your Directors have recommended a dividend of Rs. 3/- per share (30%),
same as last year, which, if declared at the next AGM, will have an
outgo of Rs. 1,069 lacs (including Dividend Distribution Tax).
Declaration of dividend as aforesaid by the Members in the next AGM is
subject to approval of Lenders of the Company.
4. SHARE CAPITAL
During the year under review, the Company increased its Authorised
Preference Share Capital from 60,00,000 Preference Shares of Rs. 100/-
each aggregating to Rs. 6,000 lacs to 1,20,00,000 Preference Shares of Rs.
100/- each aggregating to Rs. 12,000 lacs. Thereby the total Authorised
Share Capital was increased from Rs. 10,000 lacs to Rs. 16,000 lacs.
During the year under review, the Company issued and allotted
1,20,00,000 0.01% Non-Cumulative Redeemable Preference Shares of Rs.
100/- each, aggregating to Rs. 12,000 lacs to one of the Promoters of the
Company viz., Triton Trading Company Pvt. Ltd. The proceeds from the
said issue of Preference Shares were utilised for the purpose of
meeting the Promoters' contribution in Binani Cement Ltd as part of the
commitment under the restructuring package sanctioned under the Joint
Lenders' Forum and also for the purpose of meeting working capital
requirements of the Company. Consequently, the total Paid-up Share
Capital of the Company stood at Rs. 14,962 lacs as on 31st March, 2015
(previous year Rs. 2,962 lacs).
5. CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Audited Financial Statements of the Company have been
prepared in accordance with the applicable Accounting Standards issued
by the Institute of Chartered Accountants of India and forms part of
this Annual Report.
6. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(3)(c) of the Companies Act,
2013 ('the Act') your Directors state that:- a. In the preparation of
the annual Financial Statements for the year ended 31st March, 2015,
the applicable Accounting Standards read with requirements set out
under Schedule III to the Act, have been followed and proper
explanation relating to material departures, if any, has been
furnished;
b. they have selected such accounting policies as listed in the Note 2
to the Financial Statements and have applied them consistently and
prudent judgments & 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, 2015
and of the Profits of the Company for the financial year ended on that
date;
c. they have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Act for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities;
d. they have prepared the annual accounts on a going concern basis;
e. they have laid down internal financial controls to be followed by
the Company and that such internal financial controls are adequate and
were operating effectively; and
f. they have devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate
and operating effectively.
7. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION
OF THE COMPANY
1. Your Company has proposed a Scheme of Amalgamation of Binani Metals
Limited with your Company under Section 391 to 394 of the Companies
Act, 1956 (including any statutory modification or re-enactment or
amendment thereof). The appointed date for the Scheme is 1st April,
2015 or such other date as may be decided by the High Court or any
other appropriate authority. The notice for the Court Convened Meeting
and for Postal Ballot/E-voting has been despatched to the Shareholders
of the Company on 19th October, 2015 and the Court Convened Meeting is
scheduled to be held on 23rd November, 2015 at Rotary Sadan, 94/2
Chowringhee Road, Kolkata-700 020.
2. Edayar Zinc Ltd (EZL), subsidiary of the Company, has been
incurring huge fixed costs due to shut down of the plant from April 2014
onwards, except for a brief period of 59 days when the plant operated.
Due to erosion of the Net Worth, EZL was referred to Board for
Industrial and Financial Reconstruction (BIFR). Unfortunately, the
proceedings at BIFR has been getting considerably delayed. The
operations are therefore at a standstill. Meanwhile, from May 2015
onwards, employees of EZL have been given stay-at-home notice. EZL is
pursuing vigorously with BIFR for an early hearing and appointment of
an Operating Agency so that a rehabilitation package can be finalized
for resumption of operations. Further, the proceedings at BIFR are
likely to get delayed before a Rehabilitation Package could be
approved.
3. The members of Binani Zinc Limited had at their Annual General
Meeting held on 25th September, 2015 adopted the proposed name 'Edayar
Zinc Limited'. Consequently, the Registrar of Companies has issued a
fresh Certificate of Incorporation consequent to change in name from
'Binani Zinc Ltd.' to 'Edayar Zinc Limited' with effect from 6th
October, 2015.
4. The Lenders of Edayar Zinc Limited (EZL) have issued notice under
section 13(2) of SARFAESI Act, 2002. EZL has suitably replied
requesting them to withdraw the notice as the matter is pending with
BIFR under Sick Industrial Companies (Special Provisions) Act, 1985.
5. B T Composites Limited, subsidiary of the Company, is in the
process of voluntary liquidation and has appointed Mrs. Sara Sancheti,
Company Secretary in Whole Time Practice as the liquidator of the
Company.
8. PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND
SECURITIES PROVIDED
The details of loans given, investments made and guarantees given and
securities provided, during the year under review, under Section 186 of
the Companies Act, 2013 are given under Note 36 - Related Party
Disclosure as per AS 18 issued under the Accounting Standard Rules,
2006 (as amended).
9. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All transactions entered into by the Company with related parties were
in the ordinary course of business and at arm's length basis except
those disclosed herein. The Audit Committee from time to time reviewed
and approved the said transactions. Disclosures as required under AS-18
have been made in Note No.36 to the Financial Statements
The Company has not entered into any fresh material contracts with any
of the related parties during the year under review. The details of
existing Related Party Contracts/ Arrangements, modified during 2014-15,
are provided as Annexure-A to this report in Form AOC-2
10. DEPOSIT
The Company has not accepted any deposit from public within the meaning
of the provisions of Section 73 of the Companies Act, 2013 and Rules
made there under
11. OUTLOOK
The year 2014-15 had been a challenging year for the Company's major
Indian subsidiaries, namely, Binan Cement Limited (BCL) and Edayar Zinc
Limited (EZL)
BCL suffered major setback in its performance due to poor demand
scenario that prevailed in the Cement Industry owing to reduced
activities in Infrastructure and Real Estate sectors. The situation was
further aggravated due to certain coercive actions initiated in the
last quarter of FY'14, by the Rajasthan VAT Authorities (RVAT), in
connection with all past dues which were earlier in dispute. This lead
to intermittent stoppage of production and dispatches of cement
Furthermore, liquidity constraints have also affected the smooth
operations of BCL. BCL has paid Rs. 278 crore to the RVAT authorities
during February 2014 to September 2015. BCL has been sanctioned a
restructuring package by the lenders in the Joint Lenders Forum for
funding the sales tax liability. Lenders' have disbursed only part of
the sanctioned amount. Immediate disbursement of the entire sanctioned
loans will facilitate settling of issues with the RVAT authorities and
normalization of operations
The Group's Glass Fibre business, both in India and abroad have shown
considerable improvement for the year under review. Improved business
conditions in European markets, with several measures undertaken to
improve efficiency across different operating areas, resulted in
significant improvement in top-line as well as bottom-line EZL became a
sick company within the meaning of Sick Industrial Companies (Special
Provisions) Act, 1985 (SICA) and has been referred to Board for
Industrial and Financial Reconstruction (BIFR). EZL faced tough
challenges to sustain its business operations and the plant remained
shut for almost 9 months due to liquidity crunch. Due to erosion of the
Net Worth, EZL was referred to BIFR. Unfortunately, the proceedings at
BIFR has been getting considerably delayed. The operations are
therefore at a standstill. Meanwhile, from May 2015 onwards, employees
of EZL have been given stay-at-home notice. EZL is pursuing vigorously
with BIFR for an early hearing and appointment of an Operating Agency
so that a rehabilitation package can be finalized for resumption of
operations. Further, the proceedings at BIFR are likely to get delayed
before a Rehabilitation Package could be approved.
The Bankers of EZL have issued a notice under Section 13(2) of SARFAESI
Act, 2002. EZL has suitably replied requesting them to withdraw the
notice as the matter is pending with BIFR under SICA.
BIL Infratech Limited, subsidiary of your Company, continued to report
significantly improved performance though relatively smaller in volume.
12. REPORT ON SUBSIDIARY COMPANIES
In accordance with proviso to sub-section (3) of Section 129 of the
Companies Act, 2013 ("Act"), the salient features of the Financial
Statements of subsidiary companies are set out in the prescribed Form
AOC Â 1 which forms part of the Annual Report. The said Financial
Statements shall also be kept for inspection of Members at the
Registered Office and Corporate Office of the Company. The Company will
provide, free of cost, a copy of Financial Statements in respect of its
subsidiaries to any Member of the Company upon receipt of a request for
the same.
13. AUDIT OBSERVATIONS
A. The Statutory Auditors, in their Report, have made observations in
connection with fair valuation of the investments done by the Company,
creation of Business Re-organization Reserve (BRR) and transfer of sums
to offset certain expenses/write-offs.
The Board wishes to state as follows:
a. In accordance with the accounting policies applicable to erstwhile
Wada Industrial Estate Limited (WIEL) and to the Company as a successor
to WIEL, being accounting policies adopted as per the Scheme of
Amalgamation approved by the Hon'ble High Court at Kolkata on 18th
March 2014, the Company has applied AS 30, the Accounting Standard on
Financial Instruments: Recognition and Measurement, issued by the
Institute of Chartered Accountants of India (ICAI), and pursuant
thereto has as on 31st March, 2014, being the date of conclusion of the
first accounting year, classified the investments as "available for sale
financial assets" and has accordingly, measured such investments at fair
value as on that date (except for those investments whose fair value
cannot be reliably measured, which investments in accordance with AS 30
are continued to be measured at cost and their cost is considered as
the fair value). Similar treatment has been given in the current year
ended 31st March, 2015.
b. Similarly, in accordance with the aforesaid, the Company has
withdrawn the amounts from BRR arising pursuant to the merger and
adoption of AS 30 to meet the expenses like Interest and Financial
Charges, Foreign Exchange Loss, Fixed Assets written-off, Value of
Investments in subsidiaries written-off, expenses related to Scheme of
Amalgamation and Advances to subsidiary written-off.
B. Pursuant to the provisions of Section 204 of the Companies Act, 2013
and Rules made there under, the Company had appointed M/s Vinod Kothari
& Company, Company Secretaries (CP No.1391) to carry out Secretarial
Audit of the Company for the Financial Year 2014-15. The Secretarial
Audit Report is annexed to this Report as Annexure-C.
The Secretarial Auditors in their Report have made an observation
relating to a postal ballot notice for the transaction relating to
obtaining of approval for providing corporate guarantee and security by
way of pledge of shares to BCL, a subsidiary of the Company, for an
amount not exceeding Rs. 4,000 crore wherein the notice did not specify
that the related parties shall abstain from voting as required under
Clause 49(VII)(E) read with explanation (ii) thereto of Equity Listing
Agreement. Secretarial Auditors have further clarifed that even if the
votes casted by the promoters are disregarded, the resolution would
have been passed by requisite majority by unrelated parties.
The Secretarial Auditors have recommended to disclose the nature of the
interested parties as a matter of best practice.
14. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)
DIRECTORS:
Pursuant to the provisions of Section 149 of the Companies Act, 2013
and the approval of Shareholders at 51st AGM, Mr. S. Sridhar and Mr.
Rahul Asthana shall be Independent Directors of the Company till the
53rd AGM of the Company to be held in 2017. They have submitted a
declaration that each of them continue to meet the criteria of
independence as provided u/s 149(6) of the Companies Act, 2013.
Mr. Sudhakar Rao, Non-Executive Director resigned w.e.f. 30th May,
2014 due to preoccupation. Mr. V. Subramanian, Non-Executive Director
retired on 30th June, 2014. Mr. Sunil Sethy Executive Vice Chairman
and Managing Director also retired on 31st May, 2014. The Board places
on record its sincere appreciation for the said Directors for their
contribution made by respective Directors during their association with
the Company.
Ms. Shradha Binani retires by rotation and being eligible, has offered
herself for re-appointment.
The Board of Directors appointed Mrs. Jayantika Dave as an Additional
Director designated as Independent Director of the Company with effect
from 3rd July, 2015 in terms of provisions of Section 161 of the
Companies Act, 2013.
Mrs. Dave shall hold the office up to the date of ensuing AGM. The
Company has received a notice along with requisite deposit from a
Member signifying its intention to propose the candidature of Mrs. Dave
as an Independent Director. Board of Directors recommends appointment
of Mrs. Jayantika Dave for a term of up to the conclusion of 54th AGM to
be held in 2017.
Mrs. Dave has given declaration that she meets the criteria of
independence laid down under Section 149(6) of the Companies Act, 2013.
The Board recommends the aforesaid appointment / re- appointment of the
Directors. Brief profile of the Directors proposed to be appointed /
re-appointed is annexed to the Notice convening ensuing Annual General
Meeting.
Mr. N C Singhal tendered his resignation on 15th October, 2015 in view
of spirit of recent regulatory changes and was considered by the Board
of Directors at their meeting held on 24th October, 2015. The Board of
Directors wish to place on record their sincere appreciation for the
contribution made by Mr. N. C. Singhal during his tenure with the
Company as Director since 2008. Consequently, he also ceases to be
Member / Chairman of the Audit Committee, Nomination and Remuneration
Committee, Stakeholders' Relationship Committee and Finance Committee.
Consequent to the resignation of Mr. N. C. Singhal, there are three
Independent Directors and three Promoter Directors, thereby having 50%
representation of Independent Directors. Hence the requirement for
appointment of new independent director shall not apply.
KEY MANAGERIAL PERSONNEL (KMP)
The details of the Key Managerial Personnel of the Company, appointed
and ceased to be as such during the year under review, are as follows:
Sr. KMP position Appointed Resigned
Name
No. held on on
1. Mr. Sunil Sethy Managing 10th Nov, 31st May,
Director 2013 2014
2 Mr. R Chief Financial 20th Sept, 15th Jun,
Venkiteswaran Officer 2010 2014
3 Mr. K K Saraf Company 1st Aug, 30th Sept,
Secretary 2012 2015
4 Mr. Hemant Chief Financial 7th Aug, 30th Mar,
Mogra Officer 2014 2015
5 Mr. Sushil Manager 1st Jun, 30th Jun,
Bhatter 2014 2015
6 Ms. Visalakshi Chief Financial 1st Apr, -
Sridhar Officer, 2015
Manager 28th Jul, -
2015
Company 24th Oct, -
Secretary 2015
Board of Directors has formulated a Nomination and Remuneration Policy,
annexed hereto as Annexure-B, stating the criteria for determining
qualifcations, positive attributes and independence of a director and
recommend to the Board a policy, relating to the remuneration for the
directors, key managerial personnel and other employees.
15. AUDITORS
M/s. Kanu Doshi Associates, Chartered Accountants, (Firm Registration
No. 104746W) Statutory Auditors of the Company hold office until the
conclusion of ensuing Annual General Meeting and are eligible for
re-appointment. However, they have expressed their unwillingness to be
re-appointed as Statutory Auditors of the Company at the ensuing AGM.
In view of the above and based on the recommendation of the Audit
Committee, your Directors have proposed appointment of M/s. MZSK &
Associates, Chartered Accountants, Mumbai (Firm Registration
No.105047W) for a term from the conclusion of the 52nd AGM up to the
conclusion of 57th AGM, subject to the ratification by the Members at
each of the AGMs. M/s. MZSK & Associates have furnished a Certificate of
their eligibility and requisite consent under the provisions of Section
139 read with Section 141 of the Companies Act, 2013.
Your Board recommends their appointment.
16. PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Companies Act,
2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, a statement showing
the names and other particulars of the employees drawing remuneration
in excess of the limits set out in the said Rules are provided in the
Annexure forming part of this Report. Disclosures pertaining to
remuneration and other details as required under Section 197(12) of the
Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014 are also provided
in the Annexure forming part of this Report. Having regard to the
provisions of Section 136(1), read with its relevant proviso, of the
Companies Act, 2013, the Annual Report excluding the aforesaid
information is being sent to the Members of the Company. The said
information is available for inspection at the Registered Office and
Corporate Office of the Company during working hours on all working days
up to the date of AGM and any Member interested in obtaining such
information may write to the Company Secretary and the same will be
furnished without any fee.
17. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNING AND OUTGO
The Company is not being engaged in manufacturing activities. Hence,
the particulars in respect of Conservation of Energy and Technology
Absorption are not applicable to the Company.
The details of Foreign Exchange Earnings and Outgo for the Financial
Year 2014-15 are as follows:
Foreign Exchange Earning
Interest Received - 32.95 lacs
Foreign Exchange Outgo
Interest - 2342.65 lacs
Other Expenses - 4.41 lacs
18. TRANSFER OF UNCLAIMED DIVIDENDS TO INVESTORS EDUCATION AND
PROTECTION FUND (IEPF).
During the year under review, your Company has transferred a sum of Rs.
24,91,107/- to the Investors Education and Protection Fund of Central
Government, in compliance with Section 205C of the Companies Act, 1956.
This amount represents dividends for the financial year 2007-08 which
had been lying unclaimed with the Company for a period of 7 years from
the due date of the payment, despite reminders sent to concerned
shareholders for claiming the amount.
19. MEETINGS OF THE BOARD
During the year under review, 10 meetings of the Board of Directors
were held. The details such as the dates of meetings, attendance of the
Directors thereat etc. are provided in Report on Corporate Governance,
which forms part of this Report.
20. PERFORMANCE EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, Independent Directors at their meeting held,
without the participation of the Non- Independent Directors and
Management, considered/ evaluated the performance of Board, Chairman
and other Non-Independent Directors. The Board has undergone a formal
review which comprised Board effectiveness survey, 360 degree and
review of materials. This resulted in a full Board effectiveness report
and Directors' feedback. This is further supported by the Chairman's
Annual Director Performance Review. The Board subsequently evaluated
its own performance, the working of its Committees (Audit, Nomination
and Remuneration and Stakeholders' Relationship Committee) and
Independent Directors (without participation of the relevant Director).
The criteria for performance evaluation have been detailed in the
Corporate Governance Report .
21. VIGIL MECHANISM/ WHISTLE BLOWER POLICY
Pursuant to Section 177(9) of the Companies Act, 2013 read with Rule 7
of the Companies (Meetings of Board and its Powers) Rules, 2014 and
Clause 49 of the Listing Agreement, the Board of Directors had approved
the Policy on Vigil Mechanism/ Whistle Blower and the same is hosted on
the website of the Company. This Policy inter-alia provides a direct
access to the Chairman of the Audit Committee. Your Company hereby
affirms that no Director/ employee has been denied access to the
Chairman of the Audit Committee and that no complaints were received
during the year.
Brief details about the policy are provided in the Corporate Governance
Report .
22. AUDIT COMMITTEE
The Audit Committee constituted by the Board complies with the
requirements under the Companies Act, 2013 as well as Clause 49 of the
Listing Agreement. The details with respect to the composition of the
Audit Committee are included in the Corporate Governance Report, which
forms part of this Report.
There were no recommendation of the Audit Committee which were not
accepted by the Board.
23. EXTRACT OF ANNUAL RETURN
An extract of the Annual Return in the prescribed format MGT-9 as
required under Section 92 of the Companies Act, 2013 is appended as
Annexure-D to this Report.
24. INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY
Given the nature of business and size of operations, your Company's
internal control system has been designed to provide for:
a. Accurate recording of transactions with internal checks and prompt
reporting;
b. Adherence to applicable Accounting Standards and Policies;
c. Compliance with applicable statutes, policies and management
policies and procedures;
d. Effective use of resources and safeguarding of assets.
The Internal Control Systems provide for well documented policies /
guidelines, authorisation and approval procedures. Your Company
through a frm of Chartered Accountants carried out periodic audits on
all functions based on the plan and brought out any deviation to the
Internal Control Procedures. The observations arising out of the audit
are periodically reviewed and compliance ensured. The summary of
Internal Audit observations and status of implementation are submitted
to the Audit Committee. The status of implementation of the
recommendations is reviewed by the Audit Committee on a regular basis
and concerns, if any, are reported to the Board.
25. RISK MANAGEMENT
The Company had identified certain risk areas with regard to the
operations of the Company which was facilitated by a renowned frm of
consultants in Mumbai. The Internal Auditors review the steps taken for
risk mitigation/ minimization wherever possible and the status of the
same is reviewed by the Audit Committee periodically. The Company's
Board is conscious of the need to periodically review the risks
mitigation process.
26. SEXUAL HARASSMENT POLICY
The Company has adopted a Sexual Harassment Policy, pursuant to the
provisions of Sexual Harassment of Women at Work Place (Prevention,
Prohibition & Redressal) Act, 2013.
During the year under review, no complaints were received by the
Company, pursuant to the aforesaid Act / Policy.
27. CORPORATE GOVERNANCE:
Your Company is fully compliant with the Corporate Governance
guidelines, as laid out in Clause 49 of the Listing Agreement. All the
Directors (and also the members of the Senior Management) have affrmed
in writing their compliance with and adherence to the Code of Conduct
adopted by the Company. The Corporate Governance Report attached as
Annexure-E to this Report.
Mrs. Visalakshi Sridhar, CFO, Manager & Company Secretary, has given a
Certificate of compliance with the Code of Conduct, which forms part of
Corporate Governance Report as Annexure-F required under Clause 49 of
the Listing Agreement.
M/s Aabid & Co, Practising Company Secretaries, have examined the
requirements of Corporate Governance with reference to Clause 49 of the
Listing Agreement and have certifed the compliance, as required under
Clause 49 of the Listing Agreement. The Certificate in this regard is
attached as Annexure-G to this Report.
The Chief Financial Officer (CFO) certifcation as required under Clause
41 of the Listing Agreement is attached and forms part of this Report
as Annexure-H. Related Party disclosures/transactions are detailed in
Note 36 of the Notes to the Financial Statements.
28. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Braj Binani Group, through its operating Indian Subsidiaries,
undertakes the activities on an ongoing basis for upliftment of the
weaker sections and welfare of the society.
The mandatory provisions of Section 135 of the Companies Act, 2013 and
Rules made there under, with respect to CSR, are not applicable to your
Company. The details of CSR activities of the Indian Subsidiaries are
as below:
Binani Cement Limited (BCL)
In accordance with the provisions of Section 135 read with Schedule VII
of the Companies Act, 2013, as a part of its initiative under the
"Corporate Social Responsibility" drive, BCL has adopted a CSR Policy
outlining various CSR activities to be undertaken in the area of
preventive health care, making available safe drinking water, promoting
education, ensuring environmental sustainability etc.
The CSR policy of can be accessed on the BCL's web link
http://www.binanicement.in/investor-relations.
Edayar Zinc Limited (EZL)
The mandatory provisions of Section 135 of the Companies Act, 2013 and
Rules made there under, with respect to Corporate Social Responsibility,
are not applicable to EZL. However, it is socially conscious about its
participative role in development of society. The Group continues to
undertake CSR activities in Binanipuram where the plant is situated and
the same are well appreciated by the local community at large.
Goa Glass Fibre Limited (GGFL)
The provisions of Section 135 of the Companies Act, 2013 and Rules
there under with respect to CSR are presently not applicable to GGFL.
However, as a part of Corporate Social Responsibility, educational
program with respect to safety, health and environment was organized in
nearby village, Colvale, where GGFL also conducted free medical camps.
29. OTHER DISCLOSURES
Your Directors state that no disclosures or reporting is required in
respect of the following items, as the same is either not applicable to
the Company or relevant transactions / events have not taken place
during the year under review.
a. Issue of equity shares with differential rights as to dividend,
voting or otherwise.
b. Issue of shares (including sweat equity shares) to employees of the
Company under any scheme.
c. The Managing Director of the Company did not receive any
remuneration or commission from any of its subsidiaries.
d. No significant or material orders were passed by the Regulators or
Courts or Tribunals which impact the going concern status and Company's
operations in future.
30. RECOGNITION AND REWARDS
The Company's Subsidiaries both in India and abroad have been rewarded
by prestigious Bodies / Governments in recognition of various
initiatives taken by them. Some of them are as follows:-
Binani Cement Limited
National Award for Prevention of Pollution in Cement Category for year
2010-11 by Ministry of Environment and Forest, New Delhi.
Greentech Environment Excellence Silver Award - 2014 from Greentech
Foundation, New Delhi.
Best Employer Award for the year 2013 given by the Employers
Association, Rajasthan.
Environment Protection & CSR Award from DM (Sirohi), Rajasthan.
District Level Trees Booster Award 2014-15 from Forest Department,
Government of Rajasthan for BCL's Neem-Ka- Thana Grinding Unit.
Shandong Binani Rongan Cement Company Limited
Economy work contribution bronze award and Enterprise of integrity
award from CPC Ju County Party Committee and Ju County People's
Government during the year 2014-15.
31. HUMAN RESOURCES
Across the Companies in the Group, Employee Relation continues to
remain cordial. The Group's emphasis on safe work practices and
productivity improvement is unrelenting.
The Company had 38 permanent employees on its roll as on 31st March,
2015. The Board places on record its sincere appreciation for the
valuable contribution made by the employees across all levels in the
organization.
32. CAUTIONARY STATEMENT
Statements made in this Report, describing the Company's objectives,
projections, expectations and estimates regarding future performance
may be "forward looking statements" within the meaning of applicable
laws and regulations and are based on currently available information.
The Management believes them to be true to the best of its knowledge at
the time of preparation of this Report. However, these statements are
subject to future events and uncertainties which inter-alia include
regulatory changes, tax laws, economic developments within the Country
and other incidental factors, that could cause actual results to differ
materially from those as may be indicated under such statements.
33. ACKNOWLEDGEMENTS
The Directors wish to express their appreciation for the continued
co-operation of the Central and State Governments, bankers, financial
institutions, customers, dealers and suppliers and also the valuable
assistance and advice received from the joint venture partners, and all
the shareholders. The Directors also wish to thank all the employees
for their contribution, support and continued co-operation throughout
the year.
For and on behalf of Board of Directors of
Binani Industries Ltd
Braj Binani
Chairman
Date : 24th October, 2015
Place: Mumbai
Mar 31, 2014
Dear Member,
The Directors present the Fifty-first Annual Report of the Company
together with the Audited Financial Statements for the Financial Year
ended 31st March, 2014
1. FINANCIAL HIGHLIGHTS
(Rs. in Lacs)
Particulars Year ended Year ended
31.3.2014 31.3.2013
Total Revenue 13,264.06 18,734.19
Finance Costs 26,818.09 9,384.00
Depreciation & Amortisation 126.70 119.17
Transfer from Business (28,852.38) -
Reorganisation Reserve
Profit/(Loss) before Tax & 1,960 .24 (2,618.33)
Exceptional items
Less: Provision for Tax - 255.20
Add: Exceptional Items - 4,111.87
Profit after Tax 1,960 .24 1,238.34
Loss pursuant to amalgamation (506.39) -
of a Subsidiary Company
Transfer to General Reserve (196.25) (124.00)
Proposed Dividend (887.89) (887.89)
Dividend distribution Tax (150.90) (150.90)
(Loss) brought forward from last (2,403.71) (2,603.25)
year
Transferred from General Reserve 196.25 124.00
(Loss) carried to balance sheet (1,988.65) (2,403.71)
2. REVIEW OF OPERATIONS
Your Company, being a Holding Company, has no manufacturing activities.
It provided management and support services to its major Subsidiaries
and granted license for use of its Intellectual Property Rights such as
Brand, Logo & Trade Mark, by the Subsidiaries. Therefore, its main
revenue resources are Management Support Service charges and Royalty
from its major Subsidiaries and dividend from investments.
For providing management and support services to the Subsidiaries, the
Company had created a Talent Pool comprising of Professionals with rich
and varied experience in different functional areas. The Company
provided expertise and support services to its Subsidiaries in all
support functional areas including Risk Management and strategic
matters etc. The Company also regularly takes initiatives in Brand
Promotion & Brand Building exercise and spends considerable amount on
advertisement which help the Subsidiaries derive significant benefits.
For the year under review, Company earned total Income of Rs. 13,264.06
Lacs which included Management Services fee of Rs. 5,182.00 Lacs,
Royalty of Rs. 6,883.57 Lacs and Interest and other income amounting to
Rs. 1,198.49 Lacs. During the year 2013-14, the Company''s performance
suffered sharp set back due to substantially lower revenue owing to
lower Royalty income in view of lower sales of the major Indian
Subsidiaries, Binani Cement Limited(BCL) and Binani Zinc Limited(BZL)
and higher finance costs. This resulted in Company earning Profit after
Tax of Rs. 1,960.24 Lacs (after transfer of a sum of Rs. 28,852.38 Lacs
from Business Reorganisation Reserve) for the financial year under
review, as against Rs. 1,238.34 Lacs in the previous year.
3. DIVIDEND
Your Directors have recommended a Dividend of Rs. 3/- per share (30%)
same as last year, which will have an outgo of Rs. 1,038.79 Lacs,
inclusive of Dividend Distribution Tax.
The Dividend, if approved by the Members at the ensuing Annual General
Meeting, would be paid to those Members whose names appear in the
Register of Members/ Beneficial Holders as on 23rd September, 2014.
4. OUTLOOK
The year 2013-14 has been a challenging year particularly for BCL and
BZL.
BCL suffered initially due to poor demand scenario that prevailed in
the Cement Industry coupled with increased input costs and finance
costs. The situation aggravated further in the last quarter of the year
2013-14 when the business crippled due to coercive measures taken by
the Rajasthan VAT Authorities for recovery of the VAT dues for the past
years, resulting in the Company shutting down its plants in Rajasthan.
BZL also had to shut its unit intermittently during the year under
review, due to steep increase in input costs and non availability of
concentrates.
The Group''s Glass Fibre business, however, has shown improvement from
the later part of the financial year 2013-14, as a result of several
measures undertaken to improve efficiency parameters, supported by the
improved business conditions in the European Markets.
Your Company''s another Subsidiary, BIL Infratech Limited continued to
report significantly improved performance, though relatively smaller in
volume.
During the financial year 2012-13, your Directors had decided, to
divest the Company''s stake in Binani Cement Limited ( BCL) to the
extent of 40% of the share capital of BCL, mainly with the objective of
improving the cash flow position of the Company, reducing the interest
cost significantly by retiring some of its debts. The Company although
initiated necessary steps, the divestment could not materialise
primarily due to poor investment sentiments and political uncertainties
that prevailed in the Country . With the expected improvement in the
investment climate and prospects for the cement industry, your
Directors are hopeful of concluding at least part of the proposed
divestment towards later part of the current financial year.
With a view to cut down overall costs during the current financial
year, the Company has undertaken major exercise for rationalisation of
manpower in the common talent pool thereby substantially bringing down
the overheads. Consequently, the Company has decided to discontinue the
current practice of recovery of Management Support Service charges from
the Subsidiaries and continue to provide advisory support from its own
resources, free of any recovery therefor.
In view of the uncertainty prevailing relating to settlement of VAT tax
matters of BCL, ongoing process for restructuring of the debts of BCL
and BZL through respective Joint Lenders'' Forum and current tight
liquidity situation your Directors expect the current financial year to
be a challenging one.
5. AUDITORS'' OBSERVATIONS
The Auditors, in their Report, have made observations in connection
with fair valuation of the Company''s investments done by the Company,
creation of Business Reorganisation Reserve(BRR) and transfer of sums
to offset certain expenses/write-offs.
The Board wishes to state as follows:
A. In accordance with the accounting policies applicable to erstwhile
Wada Industrial Estate Limited (WIEL) and to the Company as a successor
to WIEL, being accounting policies adopted as per the Scheme of
Amalgamation approved by the Hon''ble High Court at Kolkata on 18th
March 2014, the Company has applied AS 30, the Accounting Standard on
Financial Instruments: Recognition and Measurement, issued by the
Institute of Chartered Accountants of India (ICAI), and pursuant
thereto has as on March 31, 2014, being the date of conclusion of the
first Accounting Year, classified the investments as "available for
sale financial assets" and has accordingly, measured such investments
at fair value as on that date (except for those investments whose fair
value cannot be reliably measured, which investments in accordance with
AS 30 are continued to be measured at cost and their cost is considered
as the fair value).
B. Similarly, in accordance with the aforesaid, the Company has
withdrawn the amounts from BRR arising pursuant to the merger and
adoption of AS 30 to meet the expenses like Interest and Financial
Charges, Foreign Exchange Loss, Fixed Assets written-off, Value of
Investments in subsidiaries written-off, expenses related to Scheme of
Amalgamation and Advances to subsidiary written-off.
6. CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company, prepared in
accordance with relevant Accounting Standards viz. AS21, AS23 and AS27
issued by the Institute of Chartered Accountants of India, form part of
this Annual Report.
7. SUBSIDIARIES
7.1 Report on Subsidiary Companies
In accordance with the General Circular No. 2/2011 dated 8th February
2011 issued by the Ministry of Corporate Affairs, Government of India,
under Section 212 of the Companies Act, 1956, the Balance Sheet,
Statement of Profit and Loss and other documents of the Subsidiary
Companies are not being attached to the Balance Sheet of the Company.
However, the financial information of the Subsidiary and also the step
down Subsidiary Companies, are disclosed in this Annual Report in
compliance with the said Circular. The Annual Accounts of the
Subsidiary and Step Down Subsidiary Companies are kept for inspection
by the Members, at the Registered Office and Corporate Office of the
Company. The Copies of the aforesaid Annual Accounts of the Subsidiary
Companies shall be provided to any Member of the Company, who may be
interested in receiving the same.
A brief note on the Company''s major operating Subsidiaries are covered
in the Management Discussion & Analysis Report, forming part of this
Report.
7.2. Loans/Investments in Subsidiaries
During the year under review, the Company made following loans/
investments in its Subsidiaries:
7.2.1 Aggregate sum equivalent to Euro 3.82 million (Equivalent to Rs.
2985 Lacs) in 3B Binani Glass Fibre S.a.r.l, Luxembourg and US $ 3.574
millions ( equivalent to Rs. 2106 Lacs) in CPI Binani Inc, USA to
provide support in meeting their fund requirements.
7.2.2 A sum of Rs. 25 crores in 6% Redeemable Non- cumulative
Preference Shares of Rs. 100/- each in Goa Glass Fibre Limited by
converting part of the Company''s outstanding loan to them.
7.2.3 A sum of Rs. 88,160/- in Royal Vision Projects Limited (RVPL) for
acquisition of the entire Share Capital of RVPL, thereby making RVPL a
wholly owned subsidiary of the Company.
7.3. Merger/Liquidation of the Subsidiaries/Step-down Subsidiaries
During the year under review, Scintillating Buildtech Private Limited,
a Step-down subsidiary of the Company merged with Wada Industrial
Estate Limited, a wholly owned subsidiary with the Appointed Date being
1st November, 2013, pursuant to the Scheme of Amalgamation as approved
by the Hon''ble Calcutta High Court. Further, Wada Industrial Estate
Limited was merged with the Company with the Appointed Date being 1st
December, 2013, pursuant to the Scheme of Amalgamation approved by the
Hon''ble Calcutta High Court. Necessary effects, as a result of the
aforesaid mergers, have been given in the Financial Statements for the
year 2013-14.
The Company also liquidated its two overseas Subsidiaries namely BIL
Holdings I S.a.r.l, and BIL Holdings II S.a.r.l, which were
incorporated in Luxembourg in the year 2012 as Special Purpose
Vehicles, in connection with the acquisition of 3B Group.
Further, the Company''s step-down subsidiaries viz. Project Bird
Holdings S.a.r.l, Luxembourg and Project Bird Holding II S.a.r.l,
Luxembourg were merged with Project Bird Holding IIIB S.a.r.l
Luxembourg in December, 2013.
7.4 Financial Highlights and Business Outlook of the Company''s
Subsidiary Companies
The Financial Highlights and Business Outlook in respect of the
Company''s major Subsidiaries and also of Step Down Subsidiary, Goa
Glass Fibre Limited, are given below:
7.4.1 Binani Cement Limited ( BCL)
Financial Highlights
(Rs. in Lacs)
Particulars 2013-14 2012-13
Total Revenue 196,224 228,019
Profit before Depreciation,
Interest & Tax and Exceptional
Items 24,452 47,132
Provision for Depreciation 10,533 10,543
Interest and Financial Charges 27,325 21,090
Profit/(Loss) before Tax &
Exceptional items (13,407) 15,500
Exceptional Items (15,928) -
Provision for Tax 9,623 3,517
Profit/(Loss) after Tax (19,712) 11,982
Operations Review
During the year under review, BCL''s performance suffered severe
set-back due to the poor demand scenario prevailed due to economic
slowdown and Infrastructure development activities being at low ebb.
The situation worsened for BCL owing to coercive actions initiated by
the Rajasthan VAT Authorities in the last quarter of FY 2014 for
recovery of past VAT dues which forced BCL to shut-down its Plant at
Binanigram for a period of 23 days in March 2014.
During the financial year 2013-14, volume of cement produced and power
generated were as follows:-
Production 2013-14 2012-13
Cement (Lacs MT) 50 57
Power Generation (net)-Lacs kWh 3083 3520
During the year under review, BCL decided, subject to approval of
Hon''ble High Court, Kolkata and consent of Lenders, to hive- off its
Power Undertaking to Binani Energy Pvt Limited (BEPL), a wholly owned
subsidiary.
The Scheme for Hive-off has been duly approved by Hon''ble High Court at
Kolkata. Certified copy of the Order is awaited.
Business Outlook
Indian Cement Industry
Following the downtrend in the GDP growth of the Country, the cement
demand scenario has been sluggish for the last few years. The poor
demand of Cement is attributable to steep cut in the Government''s
spending in infrastructure and sluggish housing activity due to weak
investment cycle.
On the back of stable Government at the centre, with the anticipated
trend of revival in economic growth and higher Government spending, the
trend is expected to reverse and significantly boost the demand growth
for Cement.
The increase in logistic costs due to increase in diesel process and
rail freight will however, put pressure on the margins. Dependence on
international coal is another uncertainty that the cement industry
needs to grapple with.
Outlook
Closure of BCL''s plant at Binanigram for about 48 days during
March-April 2014, has resulted in the loss of market share. BCL has
strategized to focus aggressively on cost deduction and maximizing the
margins by focusing on its core markets. The extensive focus is also
planned by BCL to drive fixed costs down by reducing dependency upon
self provided services through outsourcing.
BCL''s international operations through its Subsidiaries in Dubai have
turned profitable and it is focusing now to enhance its market share in
untapped areas. Its China operations are also turning profitable and
its endeavour is to enhance cement capacity to 4 Million Tonnes per
annum going forward.
With the current ongoing uncertainties caused by the Government
actions, the outlook for the current Financial Year 2014-15 of BCL''s
Indian operations appear challenging.
7.4.2 3B Binani Glassfibre S.a.r.l (3B Binani)
Financial Highlights
(Consolidated Unaudited)
(Euro in Million)
Particulars 2013-14 2012-13
Total Revenue 183.02 169.79
Profit/(Loss) before 19.13 12.50
Depreciation, Interest
& Tax
Provision for Depreciation 14.13 15.71
Interest and Financial 20.66 23.00
Charges
Profit/(Loss) before Tax (15.66) (26.20)
Provision for Tax 0.52 0.55
Profit/(Loss) after Tax (16.18) (26.75)
Operations Overview
3B Binani on a consolidated basis, reported marked improvement in its
performance in the year 2013-14 over the last year. The total revenue
went up by about 7.8%; the loss after tax was reduced to Euro 16.18
Million, significantly lower by about 40% over previous year. The
European markets have started showing signs of recovery towards the end
of the year 2013, while India stagnated. 3B Binani has taken
significant steps to further improve efficiencies across all functions
and across 3 manufacturing locations in Europe and India, which already
led to improved performance during the year while the full impact will
be delivered in 2014-15.
Industry Overview
During 2013-14, the global glassfibre industry still carried a high
inventory level and some overcapacity from the previous years. This
unbalanced situation continued to put pressure on glassfibre prices
throughout 2013. Nevertheless, the good global demand combined with
limited additional capacity led to improved capacity utilization in the
latter part of 2013 and gives a positive perspective for the future.
The year 2013 for the European Industry showed the continued impact of
the economic crisis over the last two years. The overall economic
climate remained uncertain and unpredictable. Around mid-2013 macro-
economic indicators started to turnaround indicating a slight recovery
through the second half of 2013 and continuing during the first half of
the year 2014. Starting at a reasonable level in 2013, the demand for
glassfibre in European countries grew, fuelled by the economic recovery
in the second half of 2013 and ended up at a good level compared to
previous years. This robust demand level has been sustained so far in
the current year.
In European Union, Automotive did follow the trend with a slow start
and a recovery towards the second half of 2013 and positive growth
beginning of 2014. The increased use of glass fibre in automotive parts
at the expense of steel is supporting higher demand in this segment.
The Wind business was impacted by project delays in offshore but showed
overall stability. The demand growth in the Indian Composites Industry
has remained virtually stagnant due to sluggish growth globally and
political uncertainty in India. Although it is difficult to predict the
long term growth of this Industry in India, we remain positive about
its prospects with an estimated growth of 7-9% per year over the next 5
years.
Business Outlook
3B Binani continues to focus on its core markets Automotive, Wind and
Performance Composites, supplying these markets with high quality
Chopped Strands and Direct Roving products supported by high
performance specialty products like HiPer-tex and CFM. 3B Binani has a
strong focus on innovation to develop value added products for its
customers in order to deliver product differentiation, to improve the
profitability and keep ahead of competition. All of its 3 plants are
focusing on improving their cost structure by optimizing production to
reach the best efficiencies within the industry.
3B Binani is well positioned in Europe and India to enjoy the market
growth when the market bounces back in 2014-15.The quality of the asset
and the Know- How together with the state-of-the art R&D Center in
Belgium, makes 3B Binani an ideal partner to address the challenges in
the automotive and wind industry.
7.4.3 Binani Zinc Limited( BZL)
Financial Highlights
(Rs. in Lacs)
Particulars 2013-14 2012-13
Total Revenue 36,096 44,860
Profit/(Loss) before (1,048) (1,451)
Depreciation, Interest & Tax
and Exceptional Items
Provision for Depreciation 763 887
Interest and Financial 937 1021
Charges
Profit/(Loss) before Tax & (2,748) (3,360)
Exceptional items
Exceptional Items - 2,052
Provision for Tax (244) (263)
Profit/(Loss) after Tax (2,504) (1,044)
Review of Operations
BZL''s performance for the year 2013-14 suffered set back on account of
lower production and sales which was largely attributed to intermittent
shut down of the plant due to non availability of Zinc Concentrates
owing to liquidity constraints and certain break-downs. The total Zinc
production for the year stood at 24,131 MT as compared to 32,836 MT in
the previous year. However, various measures taken by the Company to
improve the performance, helped containing the Loss before tax and
exceptional items at Rs. 2,748 Lacs as against Rs. 3,360 Lacs.
BZL has become a Potentially Sick Industrial Company within the meaning
of the provisions of Sick Industrial Companies ( Special Provisions)
Act, 1985. The Directors of BZL have planned various strategic measures
to achieve a turnaround at the earliest.
BZL''s Plant is currently under shut down since 29th March, 2014 owing
to non-availability of concentrate. Steps are being taken to restore
the manufacturing operations at the earliest.
Industry Overview
The Indian economy remained in a ''go slow'' mode throughout the year
2013-14. GDP growth estimates had to be revised downwards several times
by RBI and other rating agencies. High interest rates due to high
inflation have stalled the industrial growth in the Country and this
was reflected in the low demand of metal. However, the BZL''s strategy
to be a "supplier of choice" continued to pay rich dividends in terms
of premium achieved on metal sales.
London Metal Exchange (LME) prices of Zinc remained low throughout the
year, at an average price of $1910/ MT during 2013-14 as compared to
the previous year''s average of $1950.
The concentrate supply position continued to be influenced by Chinese
spot purchases. Almost 80-85% of concentrate production is tied-up
under long term contracts or for captive supply. Spot markets suffered
from inadequate supply of treatable concentrates. Treatment charges
therefore, continued to be significantly below Benchmark terms.
Business Outlook
Zinc consumption, world-wide, has bounced back from the modest
expansion of 2.1% seen last year to a more robust 3.6% during the year
under review. The gradual recovery in economic activity seems to have
become sustainable and the global economy should continue its recovery
in 2014. The stabilization of the global economy in 2014 and 2015 is
expected to result in accelerated zinc consumption growth of 5.6% and
4.8% respectively.
LME Prices recently have shown uptrend which will have positive impact
on BZL in the current year.
It is expected that India will regain its lost momentum, during the
current year, with major investments scheduled in infra projects like
telecom & power.
7.4.4 BIL Infratech Limited ( BILIL)
Financial Highlights
(Rs. in Lacs)
Particulars 2013-14 2012-13
Total Revenue 33,608 12,783
Profit before Depreciation, 1,755 417
Interest & Tax and
Exceptional Items
Provision for Depreciation 230 153
Interest and Financial Charges 251 137
Profit before Tax 1,274 127
Provision for Tax 478 46
Profit after Tax 796 81
Operations Review
For the year under review, BILIL reported significantly improved
performance with the total income moving up by 162% over the last year.
Profit after Tax registered a quantum jump to Rs. 796 Lacs as against
Rs. 81 Lacs. At the close of Financial Year 2013-14, BILIL had healthy
order backlog of over Rs. 45,500 Lacs which mainly comprised of the
construction projects.
Industry Overview
The year 2013-14 was one of the toughest years in the recent past
mainly due to lack of investment opportunities and political
instability in the Country. The infrastructure business segment on
which BILIL dependent upon, was one of the worst affected business
segments during the year 2013-14. However, with the change in the
Government at the Centre, the business prospects going forward, is
likely to be highly encouraging.
Business Outlook
The Government''s recent announcement of construction of Freight
Corridors, High Speed Trains, Metros in Tier-2 Cities, and building up
of health & sanitation facilities, will offer extensive opportunities
in infrastructure sector, which in turn, is expected to enhance the
prospects of BILIL business.
7.4.5 CPI Binani Inc. ( CPI)
Financial Highlights:
(Amount USD in Million)
Particulars 2013-14 2012-13
Total Revenue 14.86 15.42
Profit/(Loss) before 0.44 0.69
Depreciation, Interest & Tax
and Exceptional Items
Provision for Depreciation 1.36 1.27
Interest and Financial Charges 0.81 0.49
Profit/(Loss) before Tax (1.73) (1.07)
Provision for Tax 0.56 0.49
Profit/(Loss) after Tax (1.17) (0.58)
Operations Overview
CPI''s performance for the year 2013-14 had more or less, remained
stagnant. During the year 2013- 14, CPI has taken effective steps for
improving the performance, which is expected to yield better results in
the current year.
Industry Overview
The US economy is showing positive signs now with the economy estimates
for the second quarter growth having been upgraded with growth
projections now hovering around 3%. This augers well for CPI, which
will result in higher sales from its key customer segments of marine
recreational vehicles, agriculture and construction equipments and
automobiles.
Business Outlook
CPI Binani has focused on its core competence of composite based
solutions and diversified in to new segments beyond automobiles. This
has given better results with growth in sales during the current year.
In addition to the growth with existing customer base, steady stream of
new opportunities are coming in, which is expected to facilitate
improved performance in the current year.
7.4.6 BT Composites Limited(BTCL)
Financial Highlights
(Rs. in Lacs.)
Particulars 2013-14 2012-13
Total Revenue 217 454
Profit / (Loss) before
Depreciation, Interest & Tax (441) (88)
Provision for Depreciation 36 56
Interest and Financial - -
Charges
Profit / (Loss) before Tax (476) (144)
Provision for Tax (1) -
Profit / (Loss) after Tax (477) (144)
In view of the continuing losses incurred , BTCL in November 2013
decided to discontinue the manufacturing operations and dispose-off all
its moveable and immovable assets. BTCL has already disposed/agreed to
dispose of all its assets and also relieved all its employees/workers.
The Company has now decided to dissolve BTCL through voluntary
winding-up process, subject to necessary approvals, upon conclusion of
the exercise for disposal of assets.
7.4.7 Sankalp Holdings Limited (SHL)
SHL is an Investment Holding Company. For the year 2013, SHL incurred a
loss of US$ 47,972 as against US$ 10,914 in the previous year. SHL is
currently under liquidation process.
7.4.8 Binani Global Cement Holdings Private Limited (BGCHPL)
BGCHPL was incorporated in Singapore on 1st March, 2013. BGCHPL is yet
to commence the activity. For the year ended 31.3.2014 BGCHPL incurred
a loss of US$ 2017.
7.4.9 Royalvision Projects Private Limited (RPPL)
RPPL was acquired by the Company on 10th January, 2014 and it has
become a wholly owned subsidiary of the Company. RPPL is yet to
commence the business activity. For the period ended 31st March 2014,
RPPL incurred a loss of Rs. 0.27 Lac.
8. DIRECTORS
Mr. Sudhakar Rao resigned from the Board effective 30th May, 2014 since
he did not qualify to be an Independent Director under Section 149 of
the Companies Act, 2013 ("Act"). Mr. V.Subramanian, retired during the
current financial year effective 30 th June, 2014 after serving the
Board for a long tenure.
Your Directors place on record their sincere appreciation for the
fruitful contribution made by outgoing Directors.
Mr. Sunil Sethy, Executive Vice-Chairman & Managing Director of the
Company, opted for premature retirement during the current financial
year effective 1st June, 2014 after serving for over 5 years with the
Company.
During the current financial year, pursuant to the provisions of
Section 161(1) of the Act, and the Articles of Association of the
Company, the Board of Directors appointed Mr..S. Sridhar as an
Additional Director, designated as an Independent Director of the
Company effective 30th May, 2014. Mr. Sridhar shall hold Office up to
the date of the ensuing Annual General Meeting.
As per the provisions of the Section 149 of the Act, an Independent
Director can hold office for a term up to five consecutive years and
shall not be liable to retire by rotation. In view of these enabling
provisions, the Board of Directors have proposed the appointment of all
Independent Directors namely, Mr. N.C. Singhal, Mr. Rahul Asthana and
Mr. S.Sridhar, to hold office upto the conclusion of Fifty Third Annual
General Meeting of the Company and they shall not be liable to retire
by rotation.
The Company has received declarations from all the aforesaid
Independent Directors confirming that they meet the criteria of
independence as prescribed both under sub-section (6) of Section 149 of
the Act and Clause 49 of the Listing Agreement with the Stock
Exchanges.
The Company has received Notices from a Member along with requisite
deposit amounts proposing the appointment of Mr. Singhal, Mr. Asthana
and Mr. Sridhar as the Independent Directors of the Company, at the
ensuing Annual General Meeting .
Mr. Braj Binani, Chairman retires by rotation at the forthcoming Annual
General Meeting and being eligible, offers himself for reappointment.
Your Directors recommend the aforesaid appointments/ reappointments of
the Directors.
9. AUDITORS
The Statutory Auditors, M/s. Kanu Doshi Associates, Chartered
Accountants (Firm Regn. No. 104746W), hold office up to the conclusion
of the ensuing Annual General Meeting and have offered themselves for
re- appointment. They have confirmed that, if reappointed, their
appointment will be within the limits prescribed under Section 141 of
the Companies Act, 2013.
Your Directors recommend the re-appointment of M/s. Kanu Doshi
Associates, as the Statutory Auditors of the Company.
10. CORPORATE GOVERNANCE
Your Company is committed to lay thrust in achieving higher standard of
governance in all functional areas across the organization and
adherence to the Corporate Governance norms, as set out by SEBI.
A detailed Report on Corporate Governance, as stipulated under Clause
49 of the Listing Agreement together with the Certificate of M/s. Aabid
& Co, Mumbai, Practicing Company Secretaries, is annexed and forms part
of this Report.
11. MANAGEMENT DISCUSSIONS & ANALYSIS
The Management Discussion and Analysis form part of this report.
12. DIRECTORS'' RESPONSIBILITY STATEMENT
In accordance with Section 217 (2AA) of the Companies Act, 1956 the
Directors state that:-
a) in the preparation of the annual accounts , all applicable
Accounting Standards have been followed and proper explanation relating
to material departures, if any, have been furnished;
b) accounting policies as listed in Note-2 to the Financial Statements
have been selected & consistently applied and prudent judgments &
estimates have been made so as to give a true and fair view of the
state of affairs of the Company as on 31st March, 2014 and of the
Profit of the Company for the Accounting Year ended on that date;
c) proper and sufficient care for the maintenance of adequate
accounting records has been taken in accordance with the provisions of
this Act so as to safeguard the assets of the Company and to prevent &
detect fraud and other irregularities; and
d) the annual accounts have been prepared on a going concern basis.
13. INTERNAL CONTROL SYSTEM & RISK MANAGEMENT
Your Company has adequate internal control mechanism and procedures
commensurate with the size and nature of its business. The Audit
Committee reviews periodically the observations of the Internal
Auditors and the corrective actions, wherever applicable. In addition,
the effectiveness of Internal control mechanism and actions taken with
respect to Risk Mitigation, are also reviewed by the Internal Auditors,
independently and also by the Statutory Auditors.
14. CORPORATE SOCIAL RESPONSIBILITY
The Braj Binani Group, through its operating Indian Subsidiaries, have
been striving to achieve a fine balance of economic, environmental and
social imperatives, while paying attention to the needs and
expectations of the community at large. Its corporate social
responsibility initiatives encompasses holistic community development,
institution building and sustainability related.
Some of such initiatives undertaken by Group''s major Indian
Subsidiaries are as follows:-
Binani Cement Limited (BCL)
BCL is carrying out various community development activities in the
nearby villages of mines, plant and colony in particular and for the
community as a whole. The focus areas under our community development
program are broadly categorized as under:
A. Infrastructure Development
* Boring and Installation of Hand Pumps at various locations in the
adjacent villages.
* Construction of check dams for recharging ground water.
* Concretization of water wells located in the nearby villages.
* Development of Gardens.
* Construction of water trough for Cattle in the nearby villages.
B. Health
* "Eye Testing Camp" are being organized with the association of
specialized hospital in the nearby villages.
* "World Breast Feeding Week" was celebrated by the Company''s Ladies
Club at Amli Village with the association of Rajasthan Health
Department.
* Organised seven days residential training camp for moral and physical
development of children in association with NGO.
* On "World Population Day", a Workshop was organized to spread
awareness among local people and tribal people on population explosion
and its consequent problems.
C. Education
* Financial support to schools for renovation and refurbishment in the
adjoining villages.
* Distribution of sweater, utensils and other items in schools of
adjoining villages
D. Stakeholder Engagement Program
* Financial support / organizing various sports events, functions and
fair.
* Construction / Maintenance of various buildings for use of general
public.
Binani Zinc Limited (BZL)
Major CSR initiatives including Binanipuram Social Development
Programme, BZL sponsored Hi-Tech Class Room, Rotary-Binani CSR Award,
Hi-Tech Class Room (the first of this kind in the community) was highly
appreciated by media and public at large.As a part of promoting the
concept of CSR in other industries, BZL has been sponsoring CSR Award
in association with Rotary International for the best CSR practices.
Higher Education Scholarship Scheme is a flagship project of
Binanipuram Social Development Programme (BSDP), and 25 students from
various educational streams were selected for Education Scholarship.
The unique Pakalveedu Project (Day care centre for elderly people)
supported various initiatives such as nutritious food supply, medical
camps and Tour Programmes. Around 530 resident families of Edayar
community are covered under the drinking water supply scheme and
Mediclaim assistance scheme were successfully organised.
Under the provisions of Section 135 of the Companies Act, 2013 ("Act"),
it is mandatory for your Company to constitute a Corporate Social
Responsibility Committee ("CSR Committee"). Aligning with the
guidelines in the Act and the Rules notified related thereto, the Board
has constituted a CSR Committee to formulate a CSR Policy and review
and monitor the CSR activities of the Company.
15. SECRETARIAL AUDITOR
Pursuant to the provisions of the Section 204 of the Companies Act,
2013, your Directors have appointed M/s. Vinod Kothari & Company, a
firm of Practising Company Secretaries to carry out the Secretarial
Audit in the Company, as prescribed under the Act, for the financial
year 2014-15.
16. RECOGNITION & REWARDS
The Company''s Subsidiaries both in India and abroad have been rewarded
by the prestigious Bodies / Government, in recognition of various
initiatives taken by them. Some of them are as follows:
Binani Cement Limited (BCL]
* National Awards for "Best Thermal Energy Performance 2012-13" by
National Council for Cement & Building Material, New Delhi.
* National Award for "Second Best Environmental Excellence in Limestone
Mines(2011-12)" by National Council for Cement & Building Material, New
Delhi.
* National Award for "Best Quality Excellence for the year 2012-13" by
National Council for Cement & Building Material, New Delhi.
* "Best Employer Award for the year 2012" given by Employers
Association, Rajasthan.
* "Udyog Bharti Award, 2012-13" by Indian Achievers Forum, New Delhi.
* Energy Management System (ISO-50001) Certification by Det Norske
Veritas (DNV), Kolkata.
BCL''s China operations bestowed with the following Awards/Honors during
the year 2013-14- Award from CPC Ju Country Party Committee and Ju
Country People''s Government:
* Foreign investment in special contribution award;
* Economy work contribution bronze award;
* Growth type enterprise in the year 2013;
Honors issued by Rozhao Safety Production Administration Bureau-
* Third Grade enterprise of safety production standardization of
line-1:
* Third grade enterprise of safety production standardization of
Fujiazhuang Mine.
Binani Zinc Limited (BZL)
BZL has won the following State Level awards and accolades during the
year 2013-14.
* Kerala State Pollution Control Board Award for securing first
position among very large industries -2013 for substantial and
sustained efforts in pollution control .
* Safety Award-2013 from Department of Factories and Boilers.
* Outstanding Safety Performance Award -2014 from National Safety
Council.
* Excellent Safety Conscious Worker Award from National Safety Council
In addition to the above, BZL employees and family members have won
awards in different categories like safety slogan and Safety Essay
competitions organized by National Safety Council.
17. REGISTERED OFFICE
Your Board of Directors, with a view to reduce overall administrative
cost, has proposed to shift the Company''s Registered Office to 37/2,
Chinar Park, Rajarhat, New Town Road, P.O. Hatiara, Kolkata 700157
effective 1st September, 2014.
18. PARTICULARS AS REQUIRED UNDER SECTION 217 OF THE COMPANIES ACT,1956
The Statement of particulars as required, under Section 217(1) (e)
relating to Conservation of Energy and Technology Absorption and
activities relating to Exports etc. are not applicable to the Company.
Details of foreign exchange earnings and outgo are annexed to this
Report.
The Statement of particulars of Employees under Section 217 (2A) of the
Companies Act, 1956 read with Companies(Particulars of Employees)
Rules, 1975, as amended is annexed and forms part of this Report.
However, in accordance with the provisions of Section 219(1 )(b)(iv) of
the Companies Act, 1956, the Report and Accounts are being sent to all
the Members of the Company excluding the aforesaid Statement of
Particulars of Employees. Any Member, who is interested in obtaining
these particulars, may write to the Company Secretary at the Registered
Office of the Company.
19. TRANSFER OF UNCLAIMED DIVIDENDS TO INVESTORS EDUCATION AND
PROTECTION FUND (IEPF)
Pursuant to Section 205(C) of the Companies Act, 1956, the Company has
transferred a sum of Rs. 18,15,090/- being the dividends for the
financial year 2005-06, which remained unclaimed and unpaid for a
period of seven years from the date they became due.
20. HUMAN RESOURCES
Across the Companies in the Group, Employee Relation continues to
remain cordial. The Group''s emphasis on safe work practices and
productivity improvement is unrelenting.
21. GREEN INITIATIVES
As a part of the Green Initiatives, copies of this Annual Report and
Notice of the Fifty First Annual General Meeting of the Company are
being sent to all those Members whose email addresses are registered
with the Company/Depository Participants. For other Members copies in
physical form are being sent through the permitted mode of despatch.
Further, pursuant to the provisions of the Section 108 of the Act, Rule
20 of the Companies ( Management and Administration ) Rules, 2014 and
Clause 49 of the Listing Agreements with Stock Exchanges, the Company
has provided e-voting facility to all Members to enable them to cast
their votes electronically with respect to all the Resolutions as set
out in the Notice.
22. ACKNOWLEDGEMENTS
Your Directors take this opportunity to thank the Financial
Institutions, Banks, the Government Authorities, and other stakeholders
for their support and the contributions and the Employees at all levels
and look forward to their continued support.
For and on behalf of the Board
Mumbai, BRAJ BINANI
7th August, 2014 Chairman
Mar 31, 2013
Dear Members,
The Directors present the Fiftieth Annual Report of the Company
together with the Audited Financial Statements for the Financial Year
ended 31st March, 2013
1. FINANCIAL HIGHLIGHTS
(Rs.in Lacs)
Particulars Year ended Year ended
31.3.2013 31.3.2012
Total Revenue 18,734.19 19,004.05
Proft before, Depreciation, 6,884.83 9,112.54
Interest & Taxation and
Exceptional Items.
Provision for Depreciation 119.17 64.63
Interest and Financial Charges 9,384.00 10,672.01
Loss before Tax & Exceptional (2,618.34) (1,624.10)
items
Exceptional Items 4,111.87 3,626.70
Provision for Tax 255.20 634.42
Proft after Tax 1,238.33 1,368.18
APPROPRIATIONS:
Transfer to General Reserve (124.00) (137.00)
Proposed Dividend (887.89) (887.89)
Tax on Dividend (150.90) (144.04)
Loss Brought Forward from (2,603.25) (2,939.50)
Previous Year
Transferred from General Reserve 124.00 137.00
Loss carried to Balance Sheet (2,403.71) (2,603.25)
2. REVIEW OF OPERATIONS
The Company, being a Holding Company, has no manufacturing activities.
Its main revenue streams are the income from management services fees
for the management and support services provided to its major
Subsidiaries, Income from Royalty for use of its Intellectual Property
Rights such as Brand Logo and Trade Mark by the Subsidiaries & Brand
promotion/ development expenses incurred by the Company and dividend
from investments.
For providing management and support services to the Subsidiaries, the
Company has created a Talent Pool comprising of Professionals with rich
experience in different functional areas. This facilitates the Company
in providing expertise and support services to its Subsidiaries in the
areas of Accounts, Finance, Treasury, Audit, Forex / Commodity, Risk
Management,
IT, HR, Secretarial and Legal, Purchase, Taxation, Corporate Strategy,
Media Services etc. The Company regularly takes initiatives in Brand
Promotion & Brand Building exercise and spends considerable amount on
advertisement which help the Subsidiaries derive signifcant benefts.
During the year under review, the Company earned total Revenue of Rs.
18,734.19 Lacs which included Management Services fee of Rs. 5,251.50
Lacs, Royalty of Rs.12,676.66 Lacs and Interest/Dividend and other income
amounting to Rs. 806.03 Lacs.
During last year, the Company had sold 49% stake in its Subsidiary, Goa
Glass Fibre Limited (GGFL) to 3B Binani Glass Fibre S.a.r.l. (3B
Binani), a wholly owned subsidiary of the Company in order to
consolidate its Glass Fibre business and to leverage on technology and
product strength of 3B Fibreglass SPRL, Belgium. During the year under
review, the Company sold its balance 51% stake in GGFL to 3B Binani,
which resulted in proft of Rs.4 ,112 .16 L ac s .
For the year, 2012-13, the Company earned Proft after Tax of Rs.1,238.33
Lacs as against Rs.1,368.18 Lacs in the previous year.
3. DIVIDEND
Your Directors have recommended a dividend of Rs. 3/- per share (30%) the
same as last year, which will have an outgo of Rs.1,038.79 Lacs,
inclusive of Dividend Distribution Tax.
4. OUTLOOK
The year 2012-13 has been a challenging year particularly for Glass
Fibre and Zinc business. Glass Fibre business was affected due to
uncertainty in the European economy, Chinese imports despite anti-
dumping duty, high inventory and low capacity utilisation etc.
Proftability in case of Zinc business was severely affected due to
various factors which included lower zinc prices on LME, variations in
Exchange rates and steep hike in power tariff etc.
Various steps have been taken to improve the revenue and proftability
of the Glass Fibre and Zinc business in particular, which include
change in product-mix, effciency in manufacturing operations through
technological improvement etc. All these steps are expected to start
yielding returns in the coming years which would help the Company earn
dividend on its investments in the years to come.
Your Directors have also initiated various strategic measures in the
year under review to improve the earnings and the overall proftability
of the Company. In this direction, the Directors have decided, ''in-
principle'' to divest the Company''s stake in Binani Cement Limited (BCL)
to the extent of 40% of the share capital of BCL, which will improve
the cash fow of the Company, reducing the interest cost signifcantly by
retiring some of its debts. The Company initiated necessary steps such
as appointment of Advisors, Investment Banker, Legal Advisor,
preparation and circulation of information Memorandum to key fnancial
Investors. Both Vendor due Âdiligence and discussion with prospective
Investors are in progress. The entire process is expected to be
completed during second half of the current Financial Ye a r.
Your Directors therefore, are hopeful of much improved performance for
the current Financial Year, barring unforeseen circumstances.
4. SUBSIDIARIES
4.1 Report on Subsidiary Companies
In accordance with the general Circular No. 2/2011 dated 8th February
2011 issued by the Ministry of Corporate Affairs, Government of India,
under Section 212 of the Companies Act, 1956,the Balance Sheet and
Statement of Proft and Loss and other documents of the Subsidiary
Companies are not being attached to the Balance Sheet of the Company.
However, the fnancial information of the Subsidiary and also the step
down Subsidiary Companies are disclosed in this Annual Report in
compliance with the said Circular. The Annual Accounts of the
Subsidiary and Step Down Subsidiary Companies are kept for inspection
by the Shareholders, at the Registered Offce and Head Offce of the
Company. The Copies of the aforesaid Annual Accounts of the Subsidiary
Companies shall be provided to any Member of the Company who may be
interested in receiving the same.
A brief note on the Company''s major operating Subsidiaries are covered
in the Management Discussion & Analysis Report, forming part of this
Report.
4.2. Loans/Investments in Subsidiaries
During the year under review, the Company made following loans/
investments with a view to provide backup support to operating
subsidiaries:
4.2.1 Invested an aggregate sum equivalent to Rs. 31,198.28 lacs in 3B
Binani Glassfbre S.a.r.l, Luxembourg and provided loan Rs. 77.45 lacs to
CPI Binani Inc, USA.
4.2.2 A total amount of Rs. 4,575 lacs was paid as loan to Goa Glass
Fibre Limited out of which a sum of Rs. 25 crores was converted into 6%
Redeemable Non-cumulative Preference Shares of Rs. 100/- each.
4.2.3 Invested a sum of US $ 1000 in Binani Global Cement Holdings Pvt.
Limited in Singapore towards initial capital at the time of its
incorporation.
4.2.4 An aggregate of Rs. 54.70 lacs paid as loan to Wada Industrial
Estate Limited.
4.3 Financial Highlights and Business Outlook of the Company''s major
Subsidiary Companies
The Financial Highlights and Business Outlook in respect of the
Company''s major Subsidiaries and also of Step Down Subsidiary, Goa
Glass Fibre Limited, are given below:
4.3.1 Binani Cement Limited (BCL)
Financial Highlights
(Rs.in Lacs)
Particulars Year ended Year ended
31.3.2013 31.3.2012
Total Revenue 228,017.84 205,667.58
Proft before, Depreciation,
Interest & Taxation and
Exceptional Items. 47,132.33 33,060.18
Provision for Depreciation 10,542.86 10,354.61
Interest and Financial
Charges 21,089.69 16,140.07
Proft/(Loss) before Tax &
Exceptional items 15,499.78 6,565.50
Exceptional Items 1,250.34
Provision for Tax 3,517.30 475.37
Proft after Tax 11,982.48 4,839.79
Operations Review
During the year under review, BCL reported robust performance both in
terms of top line as well as the bottom line. It has achieved highest
ever production of 56.56 lacs MT & sold 56.81 lacs MT of cement as
against 55.84 lacs MT & 56.12 lacs MT respectively in the previous
year.
Despite higher input costs and logistics expenses, BCL earned
signifcantly higher Profts after Tax at Rs. 11,9 8 2 . 4 8 lacs as
against Rs. 4,839.79 lacs in the previous year. This is mainly attributed
to better realizations and lower fuel costs.
The cement production and power generation details are
as under :- Production 2012-13 2 011-12 Cement (Lacs MT) 56.56 55.84
Power Generation (net) - Lacs kWh 3,520.47 3,281.65
In line with the previous years, BCL continued to reduce its dependence
on Grid Power.
Business Outlook
Indian Cement Industry :
The Indian Economy is currently witnessing its lowest GDP growth in
recent years leading to sluggish demand and capacity utilization. This
has impacted the Cement Industry especially in the Industrial and
Infrastructure segment. However, various measures taken by the
Government in recent past to fuel the economy may lead to a more
positive impact in the later part of the year. The pressure on the
bottom-line will however, remain in short term due to over supply
situation and increase in logistic costs.
Company Outlook
Given the supply overhang, muted demand and high price volatility
conditions, BCL plans to improve margins by changing its product mix by
increasing share of Pozzolona Portland Cement (PPC) to Ordinary
Portland Cement (OPC) and volume enhancement by focusing on its primary
markets where it has good brand equity. With all these steps, BCL is
reasonably confdent of fostering improved results in FY''14.
BCL has also chalked out plans to implement its different expansion and
new projects in India and Overseas in high growth markets. The above
projects, upon commissioning,are expected to help BCL achieving boost
in its performance on long term sustainable basis.
During the current year, with a view to give thrust to the Power
Business, as a part of the business strategy of the Group, BCL has also
decided to hive-off its Power Business to its wholly owned subsidiary,
Binani Energy Private Limited.
4.3.2 3B Binani Glassfbre S.a.r.l (3B Binani)
Financial Highlights
(Consolidated excluding Goa Glass Fibre Ltd.)
(Euro in Million)
Particulars Year ended
31.3.2013
Total Revenue 154.27
Proft before, Depreciation, Interest 13.43
& Taxation and Exceptional
Items.
Provision for Depreciation 13.63
Interest and Financial Charges 20.87
Loss before Tax & Exceptional items (21.07)
Exceptional Items
Provision for Tax 0.55
Loss after Tax (21.62)
Industry Overview
During 2012-13, the European industry continued facing major challenges
which started in the year 2011 such as fnancial and economic crisis. As
a consequence, the overall climate remained negatively impacted by an
overall sentiment of uncertainty and unpredictability. Demand remained
relatively fat over the period and pricing suffered due to cheap
Chinese imports into Europe. Major uses of fbreglass products can be
seen in the automotive, construction and wind energy industries. The
Glass Fibre Automotive market was signifcantly down in 2012 due to
lower production of cars. This drop was mostly compensated with more
plastic use into the cars. The wind energy and construction markets
were however stable.
Operations Overview
The overall performance of the 2 manufacturing units at Belgium and
Norway is considered good and capacity was partially constrained to
cope with the lower market demand. The production ramp upto normal
effciencies went on well. Average realization was however, on the lower
side due to cheap Asian imports.
Business Outlook
The year 2013 is expected to remain in line with 2012. Market scenario
is expected to show sign of improvement from the year 2014.
3B Binani continues to focus on its core markets (Automotive,
Electronics and Consumer Goods) for Chopped Strands products and on
Construction for its
Direct Roving products. It is in the process of optimizing the product
mix with the continuous intent to move towards value added products in
order to improve the proftability and keep ahead of Asian competition.
Both Units are also focusing on improving their cost structure by
optimizing their production to reach the best effciencies within the
Industry.
4.3.3 Goa Glass Fibre Limited (GGFL)
Financial Highlights
(Rs. in Lacs)
Particulars Year Year
ended ended
31.3.2013 31. 3.2012
Total Revenue 11,085.41 10,095.25
Proft/(Loss) before, ( 5 7 7.94) 1,266.28
Depreciation, Interest &
Taxation and Exceptional Items.
Provision for Depreciation 1,482.28 1,382.74
Interest and Financial 1,521.92 1,209.45
Charges
Loss before Tax & (3, 5 8 2 .14) (1,325.91)
Exceptional items
Exceptional Items (29.86)
Provision for Tax (0.01) 5.49
Loss after Tax (3,582.13) (1,361.26)
Operations Review
During the year 2012-13, GGFL produced 14,590 MT. It sold 15,503 MT as
against 13,386 MT in the previous year. Chinese imports put the
pricing pressure and slow down in Automotive and Infrastructure Sectors
also impacted the demand for the glass fbre products.
During the year under review, GGFL ceased to be a direct subsidiary of
the Company, consequent upon the sale of the balance stake of 51% in
GGFL by the Company to 3B Binani Glassfbre Sarl (3B Binani),
Luxembourg, a wholly owned subsidiary of the Company. Therefore, GGFL
has become a wholly owned subsidiary of 3B Binani and a step-down
subsidiary of the Company.
Business Outlook
The Indian market for the glass fbre products is expected to remain
soft. The challenging competitive environment will continue to put
pressure on margins due to Chinese Imports.
GGFL is currently focusing on optimizing the product mix by giving
thrust to the products with better margins,
thereby improving proftability. This will also improve capacity
utilisation and contain the operational cost. With this perspective,
focus was on Chopped Strand Mat during the year 2012-13 which provided
better margin and will also help maximizing the production and sales in
future.
With the integration of India Operations with 3B Europe to leverage on
synergies in marketing and the strong technology base of the European
facilities, GGFL is looking forward to optimize its product portfolio
by adding high value export sales.
With the projected availability of natural gas in Goa, GGFL targets
achieving signifcant reduction in energy costs which would enable the
business to be more competitive. Further, a modernization plan aiming
at a 20% capacity increase based on higher technology equipments
(bushings, automatic triple winders) is under way. This together with
higher exports and developing a new product for wind energy for India
is the base of the next year plan. Consequently, the performance of
GGFL is expected to improve substantially in the years to come.
4.3.4 Binani Zinc Limited (BZL)
Financial Highlights
(Rs. in Lacs)
Particulars Year Year
ended ended
31.3.2013 31. 3.2012
Total Revenue 44,860.00 40,709.05
Loss before , Depreciation, (1,450.80) (1,194.46)
Interest & Taxation
and Exceptional Items.
Provision for Depreciation 887.42 904.01
Interest and Financial 1,021.41 1,518.74
Charges
Loss before Tax & (3,359.63) (3,617.21)
Exceptional items
Exceptional Items 2,052.20 1,908.13
Provision for Tax (263.00) (253.12)
Loss after Tax (1,044.43) (1,455.96)
Operations Review
India''s economic growth rate in 2012-13 was the lowest in a decade. The
slowdown in the Indian Economy impacted the industrial growth in the
Country which in turn, affected the pace of growth in zinc consumption.
For the year 2012-13, BZL produced higher volume of Zinc at 32,836 MT
as against 30,824 MT in the previous
year. However, the steep hike in the power tariff and adverse variation
in the exchange rates affected the performance of the Company. The
decline in zinc prices on LME (Average price of US$1950/MT during the
year 2012-13 as compared to average price of US $2150 in 2011-12)
affected all stand-alone Smelters. Slow Down in Automotive and Telecom
Sectors also resulted in low Zinc demand. Despite this, BZL contained
its loss at Rs. 1,044.43 lacs as against Rs. 1,455.96 lacs in the previous
year.
Industry Overview
Demand for Zinc metal, world-wide, continued to record robust growth
rates. However, the accelerated growth of previous years was muted, due
to lower than expected growth in China.
The Euro-zone crisis dampened price sentiments and with Funds keeping
away from the metals sector, LME prices recorded lower levels,
resulting in an average price of $1950/MT during 2012-13 as compared to
the previous year''s average of $2101.
The Indian economy struggled to achieve the decadal growth rates. The
GDP growth rates are positively correlated to Zinc demand. However,
BZL''s to be a "supplier of choice" continued to pay rich dividends in
terms of premium achieved on metal sales.
The power scenario in Kerala was a cause of concern & continues to be
so. Tariff hike of 35% effective from 1st July 2012, severely affected
proftability. Restrictions on power supply were also introduced which
has recently been withdrawn.
With revival of monsoon in 2013, expected Hydel Generation at normal
levels thus, restoring the balance of power in the state of Kerala.
BZL is actively interacting with the Regulatory Authorities, Kerala
State Electricity Board (KSEB) & Government, to mitigate further tariff
hikes/restrictions.
Business Outlook
The recent monetary easing, pullback in infation rates & expected
investments in infra projects like telecom & power should assist in
restoring the growth momentum for zinc demand.
During the frst half of 2012, concentrate supply was squeezed leading
to low Treatment Charges (TC). The situation has eased out since then.
Higher TC levels are expected during 2013-14.
BZL has entered into an Agreement with an established Technology
provider (M/s Tamzinco) for introducing a
process step whereby Lead-Silver (Pb-Ag) separation can be achieved
from the leach streams. The process will enable recovery of
value-adding Pb-Ag as well as generation of cleaner Jarosite of
non-hazardous nature. The process is also designed to improve the
smelter fexibility to treat concentrates with higher level of
impurities.
With the successful commissioning of the above project by 2014-15, BZL
is hopeful of growth in both the top line & bottom line.
BZL is actively working to ensure that the RBG mines start functioning
within the next couple of years. It is also pursuing its plans for
capacity expansion as well as, mini-Hydel projects. It will continue to
focus on development of value added products, from existing products as
well as solid wastes.
With the implementation of above plans, BZL is expected to report
substantially improved results in the years ahead.
4.3.5 BIL Infratech Limited ( BILIL)
Financial Highlights:
(Rs. in Lacs)
Particulars Year Year
ended ended
31.3.2013 31. 3.2012
Total Revenue 12,783.17 6,549.29
Proft before , Depreciation,
Interest & Taxation and
Exceptional Items. 417.02 136.68
Provision for Depreciation 152.83 45.67
Interest and Financial 137.39 42.28
Charges
Proft before Tax &
Exceptional items 126.80 48.73
Exceptional Items
Provision for Tax 46.05 14.09
Proft after Tax 80.75 34.64
Operations Overview
During the year under review, BIL Infratech Ltd. (BILIL) earned
Revenue of Rs.12,783.17 lacs as against Rs. 6,549.29 lacs in the previous
year. The order backlog of BILIL at the end of the year 2012-13 stood
at Rs.53,000 lacs. During the year, the Company was awarded a prestigious
work by the Government of West Bengal for construction of Aliah
University Campus of the value of Rs.2 2,10 0 l ac s .
Industry Overview
The Construction Industry has been passing through sluggish phase in
the absence of clearance of various infrastructure projects by the
Government. Similarly, there have not been too many opportunities in
EPC sector except for a few tenders which are currently in pipelines by
large corporates. Some of the engineering contracts were put on hold by
the Customers for various reasons.
Business Outlook
BILIL has participated in a number of Tenders and expect to clock a
revenue of Rs.700 Crores by FY''16. BILIL has planned various strategies
which inter-alia include concentrating on construction of residential
and commercial buildings, industrial structures , focus on EPC projects
wherever possible and strengthen its core team. BILIL hopes to achieve
total revenue of around Rs.390 Crores in 2013-14 with signifcantly
improved EBIDTA, barring unforeseen circumstances.
4.3.6 CPI Binani Inc. (CPI Binani)
Financial Highlights
(USD in Million)
Particulars Year Year
ended ended
31.3.2013 31. 3.2012
Total Revenue 13.94 10.19
Proft/(Loss) before,
Depreciation, Interest &
Taxation and Exceptional Items 0.97 (1.18)
Provision for Depreciation 1.26 1.01
Interest and Financial 0.44 0.19
Charges
Loss before Tax & (0.73) (2.38)
Exceptional items
Exceptional Items
Provision for Tax (0.30) (0.84)
Loss after Tax (0.43) (1.54)
Operations Overview
The year 2012 had been a diffcult year for CPI Binani, Inc, USA which
incurred an operating loss. The Company''s performance got affected due
to an anticipated increase in Sales not materializing in view of the
overall business scenario prevailing in USA and European Countries.
Business Outlook
CPI Team has taken various steps to improve overall performance of the
Company. These include bringing down the material cost and process
improvement, which
will signifcantly improve the contribution margins and overall
proftability. In addition, thrust is also being given on cost
containment wherever feasible. New product developments in
co-ordination with key customers are in advance stages and expected to
be fully commercialized in the coming years.
4.3.7 BT Composites Limited (BTCL)
Financial Highlights
(Rs. in Lacs)
Particulars Year Year
ended ended
31.3.2013 31. 3.2012
Total Revenue 435.60 598.74
Loss before, Depreciation,
Interest & Taxation and
Exceptional Items. (88.07) (64.72)
Provision for Depreciation 55.69 66.80
Interest and Financial 0.18 2.40
Charges
Loss before Tax & (143.94) (133.92)
Exceptional items
Exceptional Items (20.90)
Provision for Tax
Loss after Tax (143.94) (154.82)
Operations Overview
During the year 2012-13, the products manufactured by BTCL were well
received in the markets. Total Revenue was lower at Rs.435.60 Lacs
compared to Rs.598.74 Lacs in the previous year. During the year, sales
of Sheet Moulding Compound (SMC) Products was 199 MT as compared to 317
MT in the last year.
Business Outlook
BTCL has been able to focus on private construction companies and South
Central Railway. It is also looking at expanding sales operations in
other Countries where awareness of SMC (GRP) has already been
established.
4.3.8 Wada Industrial Estate Limited (WIEL)
WIEL did not undertake any business activity during the year 2012-13.
It is in the process of identifying an appropriate business
opportunity.
For the year ended 31st March, 2013, WIEL incurred a loss of Rs.39.29
Lacs as against Rs.21.05 Lacs in the previous y ear.
4.3.9 Sankalp Holdings Limited (SHL)
SHL is an investment holding Company. For the year 2012, SHL incurred a
loss of US$ 10,914 as against US$ 11,177 in the previous year.
4 . 3 .1 0 Binani Global Cement Holdings Private Limited (BGCHPL)
BGCHPL was incorporated in Singapore on 1st March, 2013 with an initial
capital of US$ 1,000. It is yet to commence any activity.
5. DIRECTORS
The Board of Directors appointed Miss Shradha Binani and Mr. Rahul
Asthana as the Additional Directors of the Company effective 5th August
2012 and 6th April 2013 respectively. They hold Offce up to the date of
the ensuing Annual General Meeting.
Miss Shradha Binani, aged 25 years, holds a Bachelors Degree in Science
and International Politics from the City University, London. She
belongs to the Promoter Group. She has, during her studies, undertaken
keen interest in international marketing. Miss Shradha Binani has been
associated with acquisition of 3B, the rebuild of furnace and expansion
of capacity in Glassfbre business of the Group.
Mr. Rahul Asthana, aged 60 years, a B. Tech from IIT, Kanpur and
Masters in Business Administration from University of Ljubljana,
Slovenia. Mr. Asthana brings with him reach experience of over 35 years
in administration of public enterprises and worked in various
departments of the Government of Maharashtra and had been Chairman of
Mumbai Port Trust. He was involved in the implementation of large
infrastructural projects. He was earlier Director of the Company before
taking up positions in Government Organisations. He retired as the
Metropolitan Commissioner, Mumbai Metropolitan Regional Development
Authority (MMRDA) before joining the Board of the Company.
The Company has received notices from a Shareholder along with a
deposit of Rs.500/- each proposing the appointment of Miss Shradha Binani
and Mr. Rahul Asthana as Directors of the Company at the ensuing Annual
General Meeting .
Mr. Jitender Balakrishnan, retires by rotation at the ensuing Annual
General Meeting. However, he has not sought reappointment. Accordingly,
Mr. Balakrishnan will cease to be a Director of the Company upon
conclusion of the Annual General Meeting. The Directors place on record
their appreciation for the invaluable contribution made by Mr.
Balakrishnan during his tenure of 3 years as a Director of the Company.
Directors do not propose to fll the vacancy arising out of the
retirement of Mr. Balakrishnan.
Mrs. Nidhi Singhania, Director retires by rotation at the forthcoming
Annual General Meeting and being eligible, has offered herself for
reappointment.
Your Directors recommend appointment of Miss Shradha Binani and Mr.
Rahul Asthana and re-appointment of Mrs. Nidhi Singhania as the
Directors of the Company.
6. EXIT OPPORTUNITY TO THE SHAREHOLDERS OF BINANI CEMENT LTD. (BCL).
Members are aw are that Shares of Binani Cement Limited (BCL) were
delisted on 23rd May, 2011 consequent upon completion of the Reverse
Book Building process by BCL for voluntary delisting of its Equity
Shares in terms of SEBI (Delisting of Equity Shares), Regulations,
2009.
With a view to provide exit opportunity to the public shareholders of
BCL under SEBI (Delisting of Equity Shares), Regulations, 2009, the
Company had sent an Exit Offer to the remaining public Shareholders to
tender their shares in the Offer. The Exit Offer closed on 29th May
2012. During the year under review, the Company thus purchased
39,63,463 shares of BCL from the public Shareholders at a price of Rs. 90
per share valued at Rs. 3,567.11 lacs. Consequently, the Company''s stake
in BCL has gone up marginally to 98.43%.
7. AUDITORS
The Statutory Auditors, M/s. Kanu Doshi Associates, Chartered
Accountants, hold offce upto the conclusion of the forthcoming Annual
General Meeting and have offered themselves for re-appointment. They
have confrmed that, if reappointed, their appointment will be within
the limits prescribed under Section 224(1B) of the Companies Act, 1956.
Your Directors recommend their re-appointment as Statutory Auditors of
the Company.
8. AUDITORS'' OBSERVATIONS
The observations in the Auditors'' Report on standalone and consolidated
accounts are self explanatory and need no further explanations. With
regard to the Qualifed Opinion of the Auditors, the justifcation for
the accounting treatment adopted by the Company, has been provided
under Note no. 34 of the annexed Accounts.
9. CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company, prepared in
accordance with relevant Accounting Standards viz. AS21, AS23 and AS27
issued by the Institute of Chartered Accountants of India, form part of
this Annual Report.
10. CORPORATE GOVERNANCE
Your Company lays strong emphasis on observance of Corporate Governance
in all functional areas across the organization.
A detailed Report on Corporate Governance together with a Certifcate of
the Compliance of Clause 49 of the Listing Agreement received from the
Practising Company Secretary, M/s. Uma Lodha & Associates, is annexed
and forms part of this Report.
11. MANAGEMENT DISCUSSIONS & ANALYSIS
The Management Discussion and Analysis form part of this Report.
12. SECRETARIAL COMPLIANCE
The Company has obtained a Certifcate of Compliance from M/s. Uma Lodha
& Associates, Practising Company Secretary which reassures that the
Company has complied with all the requirements under the provisions of
the Companies Act, 1956 and also the Stock Exchange Listing Agreement.
This refects the Company''s continued emphasis on Governance and
Compliances.
13. DIRECTORS'' RESPONSIBILITY STATEMENT
In accordance with Section 217 (2AA) of the Companies Act, 1956 the
Directors state that:- a) in the preparation of the annual accounts ,
all applicable Accounting Standards have been followed and proper
explanation relating to material departures, if any, have been
furnished;
b) accounting policies as listed in Note 2 to the standalone fnancial
statements have been selected & consistently applied and prudent
judgments & estimates have been made so as to give a true and fair view
of the state of affairs of the Company as on 31st March, 2013 and of
the Proft of the Company for the Accounting Year ended on that date;
c) proper and suffcient care for the maintenance of adequate accounting
records has been taken in accordance with the provisions of this Act so
as to safeguard the assets of the Company and to prevent & detect fraud
and other irregularities; and
d) the annual accounts have been prepared on a going concern basis.
14. INTERNAL CONTROL SYSTEM & RISK MANAGEMENT
The Company believes that a strong Internal Controls framework is one
of the important pillers of Corporate Governance. The Group has
embedded internal control in the processes and operations across all
the Companies in the Group. The Company had also undertaken Risk
Assessment exercise earlier in respect of all the operational areas in
its major Indian Subsidiaries which was facilitated by a renowned frm
of Consultants. The effectiveness of Internal control mechanism and
actions taken for Risk Mitigation, are reviewed by the Internal
Auditors, Independently and also by the Statutory Auditors. The Audit
Committees of Directors of the respective Companies review the
observations of the Internal Auditors at its meetings periodically.
The Company is also currently in the process of creating a Corporate
Cell to oversee the Internal Controls in the business processes across
the Group.
15. CORPORATE SOCIAL RESPONSIBILITY
The Braj Binani Group upholds deep conviction in Corporate Social
Responsibility(CSR). Social welfare and community development is at the
core of the Group''s CSR philosophy and continue to draw regular
attention of the Top Management. It focuses not only on protecting
health and ensuring the well-being and security of its Employees, but
that of up-liftment of the local communities also, in which its various
manufacturing units operate.
Some of the main CSR activities undertaken by the major Subsidiary
Companies are mentioned below:
15.1 Binani Cement Limited ( BCL)
BCL is carrying out various community development activities in
partnership with M/s. Rajasthan Bal Kendra Sansthan (RBKS), a NGO. The
focus areas under its community development programme are broadly
categorized as :
a. Development of infrastructure  Existing Well Development, farm
Pond, cattle Troughs, Roof Rain Water harvesting, irrigation facility
creation through providing diesel pumps to the group of benefciary.
b. Increase in literacy / awareness levels by imparting education to
children and community -
Assisting the villagers, including old-age residents and widows, for
opening post offce pension accounts under the Mahatma Gandhi National
Rural Employment Guarantee Act (NREGA)
c. Poverty alleviation and sustaining livelihood through employment
creation and skill development  Improved seeds distribution, up-
liftment of rural women through setting up of training centers wherein
women are provided training in tailoring with additional monetary
support for purchase of sewing machines. The farmers are trained with
new improved agriculture technology.
d. Improvement of medical and health services Â
Regular awareness on health Issues are provided through meetings and
awareness camps.
e. Development and expansion of green cover in the surrounding area
ÂAwareness is spread on Natural Resource Management and soil water
conservation.
f. Micro Credit- Assisted in the organization and operation of
Self-Help Groups (SHG) across the surrounding villages. The SHG members
are provided with training on aspects such as book- keeping and opening
bank accounts to enable them take control of their own fnances.
15.2 Binani Zinc Limited ( BZL)
In BZL, the CSR initiatives are undertaken through Ghanshyam Binani
Occupational Health Centre and Ghanshyam Binani Community Hall.
Over the years, BZL has emerged as a model for CSR initiatives in
Kerala. This was also recognized by ASSOCHAM .
16. RECOGNITION & REWARDS
The efforts made and various initiatives taken by the Company''s
Subsidiaries have been well recognised by the prestigious
Bodies/Government. Some of such signifcant achievements are as under:
BCL
- Rajiv Gandhi National Quality Excellence - 2010
Commendation Certifcate from Bureau of Indian Standards, New Delhi, for
quality excellence
- Bhamashah Award from Depar tment of Education, Govt. of Rajasthan
- NSCI Safety Award - 2011 from National Safety Council, Mumbai for
developing & implementing effective Management System & procedures and
achieving good performance in Organisation Safety and Health for the
assessment period of three years -2008 to 2010.
BZL
- National CSR Excellence Award from ASSOCHAM
- Green Tech Environment Excellence Award.
17. REGISTERED OFFICE
The Company has taken on lease new offce premises at 601, Axis Mall,
Block C, Action Area-1, New Town, Rajarhat, Kolkata - 700 156 and
shifted its Registered Offce to the above premises effective 1st April,
2013.
18. FIXED DEPOSITS
During the year, your Company has neither invited nor accepted/renewed
Deposits from the public.
19. PARTICULARS UNDER SECTION 217 OF THE COMPANIES ACT,1956
The Statement of particulars as required, under Section 217(1) (e)
relating to Conservation of Energy and Technology Absorption and
activities relating to Exports etc. are not applicable to the Company.
Details of foreign exchange earnings and outgo are annexed to this
Report.
The Statement of particulars of Employees under Section 217 (2A) of the
Companies Act, 1956 read with Companies(Particulars of Employees)
Rules, 1975 (as amended) is annexed and forms part of this Report.
However, in accordance with the provisions of Section 219(1)(b)(iv) of
the Companies Act, 1956, the Report and Accounts are being sent to all
the Members of the Company excluding the aforesaid Statement of
Particulars of Employees. Any Member, who is interested in obtaining
these particulars, may write to the Company Secretary at the Registered
Offce of the Company.
20. INVESTOR SUPPORT SCHEME
Your Directors have decided to introduce an Investor Support Scheme for
the beneft of small Shareholders holding upto 100 Shares of Rs. 10 each
in physical form. Under the Scheme, the eligible Shareholders, if they
so desire, will be able to dispose-off their holding and realize the
sale proceeds without going through the process of dematerialisation of
Shares and other costs related thereto.
21. HUMAN RESOURCES
As the Organisation continues to grow exponentially and takes
signifcant strides towards global expansion, there is an increasing
focus on Human Resource training and development and functional
alignment with the business and building & enhancing people capability.
There has been considerable focus on Leadership hiring to cater to both
our current and future requirements. The Company has also embarked on
hiring younger talents/leaders to reduce the average age of the
Employees and to have a right mix of experience and dynamism.
Across the Companies in the Group, Employee Relation continues to
remain cordial. The Group''s emphasis on safe work practices and
productivity improvement is unrelenting.
22. ACKNOWLEDGEMENTS
Your Directors take this opportunity to thank the Financial
Institutions, Banks, State and Central Government Authorities, and
other stakeholders for their unstinted support and the Employees for
their co-operation & continued support.
FOR AND ON BEHALF OF THE BOARD
Mumbai BRAJ BINANI
27th July, 2013 CHAIRMAN
Mar 31, 2012
The Directors present the Forty Ninth Annual Report of the Company
together with the Audited Statement of the Accounts for the year ended
31st March, 2012
1. FINANCIAL PERFORMANCE
(Rs. in Lakhs)
Particulars 2011-12 2010-11
Revenue from operation / 19,004 8,591
other income
Profit before Depreciation, 9,113 4,570
Interest, Exceptional Items,
Extraordinary Items and Tax.
Depreciation and 65 40
amortization expenses
Profit before Interest, 9,048 4,530
Exceptional Items,
Extraordinary Items and Tax.
Interest and Financial 10,672 3,384
Charges
Profit / (Loss) before (1,624) 1,146
Exceptional items,
Extraordinary items and Tax
Exceptional Items 3,627 -
Profit before Extraordinary 2,003 1,146
items and Tax
Extraordinary Items - -
Profit before Tax 2,003 1,146
Tax (634) -
Profit after Tax 1,368 1,146
APPROPRIATIONS /
ADJUSTMENTS
Transfer to General Reserve (137) (115)
Proposed Dividend (888) (888)
Tax on Dividend (144) NIL
(Loss) brought forward from (2,940) (3,198)
last year
Adjusted with credit balance 137 115
of General Reserve
(Loss) carried to balance (2,603) (2,940)
sheet
Previous years' figures have been regrouped/reclassified wherever
necessary.
1 Review of Operations
The Company, being a holding Company, has no manufacturing activities.
Its main source of revenue is income from Management fees for
management and support services provided to all its subsidiaries in the
areas of Accounts, Finance, Treasury, Audit, Forex / Commodity, Risk
Management, Secretarial and Legal, Purchase, Taxation, Corporate
Strategy, Media Services etc. and income from Royalty for use of its
Brand Logo and Trade Mark by its Subsidiaries apart from dividend from
its subsidiaries.
During the year under review, the Company, as registered owner of the
trade mark and logo "Binani" and "Braj Binani Group" (registered
with permission from Braj Binani Family), entered into an agreement
with its major operating subsidiaries for licensing of the trade
mark/logo on a non exclusive basis against payment of royalty as a
percentage of net turnover and the Company incurred expenditure on
advertisement, brand identity, brand promotion and development exercise
etc. related to all the companies under the Braj Binani Group, of which
a ten percent share is being paid to the Promoters under an Agreement.
During the year under review, Company received Management Service fee
from all its subsidiaries aggregating to Rs. 4,403.29 Lakhs, and
Royalty for the use of Binani Logo aggregating to Rs. 9,525.53 Lakhs.
During the year under review, the Company acquired 3B Fibreglass
Belgium and 3B Fibreglass Norway through its Wholly Owned Subsidiary,
Glass Fibre Holding I Sarl, a Company incorporated in Luxembourg. The
acquisition was financed by way of Term Loans from IDBI; Dubai Branch
and Exim Bank at a cost of 275 mio Euros.
In order to consolidate its Glass Fibre business as well as to leverage
on technology and product strength of 3B-Fibreglass, the Company sold
49% of its equity stake in Goa Glass Fibre Limited to Glass Fibre
Holding I SARL.
The Company also sold its entire stake in Binani Ready Mix Concrete
Limited to Binani Cement Limited.
The above sale of shares has resulted in gain of Rs. 3,626.70 Lakhs.
During the year, the Company earned a Net Profit of Rs. 1,368 Lakhs
compared to Rs. 1,146 Lakhs in the previous years. Out of the profit of
Rs. 1,368 Lakhs, Rs. 137 Lakhs has been transferred to General
Reserve.
1.2 Future Prospects
1.2.1 Glass Fibre & Composite businesses
- With the integration of India Operations with Europe to leverage on
synergies in marketing and the strong technology base of the European
facilities, we look forward to optimizing the product portfolio to
drive capacity growth in India. The Indian market for glass
reinforcements is expected to maintain its healthy growth with
increasing pace in the Wind Energy segment and sustained growth of the
automotive sector.
- While the construction and E&E sectors in Europe are expected to
record a 2% growth in 2012 and the automobile sector poised to contract
marginally, the wind energy sector in Europe is expected to grow in
double digits. The new range of products developed by the European SBUs
for wind energy applications are expected to deliver well.
- With the projected availability of natural gas in Goa, the Company
targets achieving significant reduction in energy costs which would
enable the business to be more competitive.
- The US based composites producing subsidiary of the Company is
looking forward to improved markets against the backdrop of the USA
demonstrating signs of economic recovery. The Company's move towards
integrating the Composite businesses in USA and India will help the
Company focus better in this vertical.
1.2.2 Cement Business
Overseas
- The growth in cement consumption in China is expected to remain
robust. With the new Clinkerisation Plant of Shandong Binani Rong'An
Cement Co.Ltd. (SBRCC), which commenced operations in December 2011 now
stable and operating at 90% capacity utilization with improved thermal
efficiency following the successful commissioning of the new waste heat
recovery system, the Company plans to keep pace with the demand by
setting up a split-CGU to ramp up the cement output.
- The East African markets that have been tapped by the Company are
expected to continue growing at a healthy pace fuelled by investments
in Construction. As the Company's Grinding Unit in the UAE is ideally
located to supply the East African markets, the Company targets a
clinkerisation facility in the Middle East either through organic or
inorganic route, to feed this Grinding Unit.
India
- Inflationary pressures and weak Government finances are expected to
adversely impact the growth of the infrastructure and housing sectors
during the next Financial Year. Some recovery is expected in the latter
half of the year with marginal softening of the interest rates.
However, the Company believes that the long- term growth prospects of
our economy are intact. The Company's growth agenda for this vertical
includes continued efforts towards setting up Greenfield opportunities
for Grey Cement in the western part of India.
- While energy and transportation costs are expected to continue on a
higher trend and put pressure on a pricing in the near term, the
Company firmly believes that the markets have the capacity to absorb
cost increases in the long run. To mitigate the risks associated with
energy cost and availability, the Company recognizes that investing in
Captive Coal Assets is an important step. Efforts are on to identify
and pursue investments in such assets from a long term perspective.
- Company has been allotted Nimbri lignite mine. A detailed
techno-economic study is underway for an early exploitation of lignite.
- Binani Cement Limited is consciously improving its Pozzolana
Portland Cement (PPC) share to capitalize on the perceived
opportunities associated with Kyoto protocol and its CDM which can
additionally bring financial benefits.
- With the acquisition of Ready Mix Concrete (RMC) business from the
Company (BIL) the way forward is to leverage on the synergies and grow
the business.
1.2.3 Zinc Business
- During the next fiscal year, the growth in domestic consumption of
this metal is expected to weaken in line with the country's economic
growth on account of inflationary pressures and reduced government
spending. This however, is unlikely to affect the Company's output.
- The metal prices are expected to trend higher due to supply side
constraints, but will witness increased volatility in the near term.
This is expected to adversely impact raw material pricing in the near
term.
- The long term prospects of this metal remain robust and the Company
looks forward to growing this business through capacity expansions,
increased focus on value-added products and strategic investments in
the mining space and technology to fortify raw material security and
business sustainability.
1.2.4 Engineering & Project Construction business
The Company firmly believes that infrastructure will be a key driver of
the country's economic growth. With a well established presence in the
commodity space, a strong brand and a vast pool of talented, well
trained and experienced work force, the Company looks forward to
positioning itself as a strategic player in the EPC business through
its recently established subsidiary BIL Infratech Ltd. The Company's
move to employ modern construction methods backed by frontline
technologies to be sourced through partnerships with leading overseas
construction firms will aid the Company differentiate itself in this
competitive space.
2. SUBSIDIARIES
We present below brief report on the Operations of the Company's major
subsidiaries.
2.1. BINANI CEMENT LIMITED (BCL)
2.1.1 Industry Overview
Cement demand growth has lagged GDP growth in past two years due to
slowdown in real estate sector and lack of order inflows from
infrastructure sector. Lower-than- expected demand coupled with
incremental supplies has also resulted in declining capacity
utilizations for the Companies. Sector has also witnessed continued
cost pressures in terms of higher power, fuel and freight costs.
However it is expected that Interest rates will soften in the coming
months leading to higher demand from housing sector.
2.1.2 Financial Performance
The financial performance for the year ended 31st March, 2012 is
summarized below:
(Rs in Lakhs)
Particulars 2011-12 2010-11
Net Sales and other Income 2,05,668 1,74,335
Operating Costs 1,72,607 1,45,814
EBIDTA 31,810 28,521
Interest & Financial Charges 16,140 10,344
Cash Profit 15,670 18,177
Depreciation and Amortization 10,355 9,950
Profit before Tax 5,315 8,227
Profit after Tax 4,840 9,051
2.1.3 Review of Operations
The Company is continuing its efficient operating performance. During
the year under review the Company has surpassed all its previous
highest achievements.
The production of the cement has increased by 2.31% over 2010-11. The
Company produced 55.84 Lakhs MT cement as compared to 54.58 Lakhs MT in
2010-11. During the year share of PPC increased to 40.27% of total
cement production from 38.63% during 2010-11.
The sales of the cement has increased by 3.20% over the previous year
sales. The Company sold 56.12 Lakhs MT of cement as against 54.38 Lakhs
MT in the previous year.
Captive power generation (net) during the year under review was 3281.65
Lakhs KWh as against 3056.69 Lakhs KWh in 2010-11.
The Company's profitability could not match previous years performance
in line with Industry trends, primarily because of increased cost of
Fuel, Raw Materials, Power and logistics costs which the markets could
not absorb fully. However, January 2012 onwards there is sign of
improvement in prices resulting in improved bottom- line. Company has
registered net profit (before tax) of Rs. 5,315 Lakhs as compared to
Rs. 8,227 Lakhs during the year 2010-11.
2.1.4 Internal Control System
The Company's internal control system provides high level of system
based checks and controls commensurate with the nature and size of
operations. Regular internal audits and checks ensure that
responsibilities are executed efficiently. The Audit Committee of Board
of Directors reviews the adequacy and effectiveness of internal control
system and suggests improvement for strengthening them from time to
time. The Company has a robust risk management policy in place. The
internal audit report provides for a regular review of risk management.
2.1.5 Opportunities/ Risks/ Threats/ Concerns
Demand for Cement in India is likely to see a recovery process and will
touch levels of 6-8 percent in 2012. The increase in growth will be
triggered by the government's drive to revive economic activity by
initiating investment in infrastructure projects. A correction is
foreseen in interest rates and improved regulation as regards land
acquisition and environmental clearance leading to revival of several
on-hold projects. Cement prices are likely to maintain an upward curve
due to increasing production and ownership costs.
The Union Budget's focus on developing infrastructure and on affordable
and rural housing should provide a boost to cement demand over the next
few quarters.
Despite a strong GDP growth forecast of 8-9% in next 3-4 years,
Industry is likely to see pressures on prices due to higher demand
supply gap and increased cost of inputs, Fuel, and Logistics, denting
the bottom-line in short to medium term.
2.1.6 Recognition & Rewards
During the year 2011-12 BCL was bestowed with various awards /
recognitions in a wide variety of functional areas - Safety,
Productivity, Quality, Employee Relations, Energy Excellence and
Environment and Water Management :
2.1.7 Corporate Social Responsibility
The focus areas under our community development programme are broadly
categorized as :
1. Development of infrastructure
2. Increase in literacy levels by imparting education to children.
3. Poverty alleviation and sustaining livelihood through employment
creation and skill development.
4. Improvement of medical and health services and
5. Development and expansion of green cover in the surrounding area.
During the reporting period, the following notable additions were made
to our pre-existing Community Development Programme :
- We launched a programme on 'Educating Communities on Livelihood
Skills' covering four nearby villages in the initial phase.
- Skill Development: Among our programme initiatives aimed towards
empowering the rural community with skills for generating livelihood,
we have successfully contributed towards upliftment of rural women
through setting up of training centre's wherein women are provided
training in tailoring with additional monetary support for purchase of
sewing machines.
- Economic Sustenance: We provided assistance to the villagers,
including old-age residents and widows, for opening post office pension
accounts under the Mahatma Gandhi National Rural Employment Guarantee
Act (NREGA) scheme.
- SHGs & Savings Schemes: We assisted in the organization and operation
of self-help groups across the surrounding villages. The SHG members
are provided with training on aspects such as book-keeping, M.I.C.
development and opening bank accounts to enable them take control of
their own finances.
- Educating Farmers: Through effective public- private partnership and
in association with a non-governmental organization, we are working
extensively with the local agricultural community to educate them on
efficient agricultural and irrigation practices aimed at making optimal
use of fertilizer and cropping patterns that can maximize the yield of
their crops.
- Water Resource Development: Construction of various water harvesting
and water resource development schemes such as check dams, Tanka, farm
ponds, water troughs for cattle, renovation of ponds and wells in the
surrounding villages.
2.1.8 Human Relations/ Industrial Relations
Employee / industrial relationship have been cordial during the year.
We enjoy very healthy relationship with workmen and union which is
authenticated by zero man day's loss due to IR problem for four
consecutive years. Mutual trust and mutual understanding are neatly
blended in peaceful IR culture.
Measures taken for the safety of employees' training and development
continue to get top priority at all levels, which are reflected in the
improved quality and efficiency.
The Company's training programmes as per TNI (Training Need
Identification) and on value-based teachings enhance motivational
levels among its people.
The Company aims at making every employee to contribute to their full
potential in their job. To have robust relationship with employees the
Company launched a communication platform named "Rubaru" (Interface)
with all employees. It will be helpful in evolving a value system based
on trust, transparency and fairness within the organization.
2.1.9 Subsidiaries of Binani Cement Limited (BCL)
BCL's Subsidiaries and step down subsidiaries are operational in
various parts of the globe. Summarized financial performance of all
these subsidiaries and step down subsidiaries are given in the Annual
Report of the Company as per statement attached under Section 212(3)
and (5) of the Companies Act, 1956.
2.2. BINANI ZINC LIMITED (BZL)
2.2.1 Industry Overview
During 2011-12, low zinc prices on LME (Avg:$2101) and a tight
concentrate market, affected all stand-alone Smelters.
The Indian economy slowed down to 6.9%, after having grown at 8.4% in
each of the two preceding years. Weakening industrial growth
contributed significantly to the slowdown.
Demand for zinc grew at 7.8% during 2011-12. As per 12th Five Year Plan
projections (by the Ministerial Working group) zinc demand is expected
to reach 9,00,000 MT per annum i.e.(AGR of approximately 9%. Duty of 5%
continues in import of zinc metal, while the basic import duty on
concentrate remains @ 2.5%.
Investment opportunities are expected to continue in Power, Telecom and
Infrastructure. All end use segments of zinc are expected to register
high growth rates during 2012-13.
2.2.2 Review of Operations
(Rs in Lakhs)
Particulars 2011-12 2010-11
Net Sales & other Income 40,709 41,519
EBIDTA 714 761
Cash Profit/(Loss) (805) (296)
Profit/ (Loss) before Tax (1,709) (1,156)
Profit/ (Loss) after Tax (1,456) (857)
2.2.3 Future Plans
In line with the industry projection of market deficit by 2015-16, the
Company plans to go ahead with its capacity augmentation plan to 100
KTY. Simultaneously precious metal recovery program is being
implemented during the year which will contribute substantially to the
bottom line. Also Various options are being evaluated for acquisition
of mining assets to improve the profitability of the existing operating
and to support the development Plans of the Company.
The Company will continue to focus on value added products like alloys
to increase its realization. During the year 2011-12, the sale of
alloys grew over 250% as compared to the previous year.
The Company has also formed an "Application Team" in the R & D
department which will interact closely with present and potential
customers to develop new and value added products.
2.2.4 Strengths/Opportunities/Threats/Risks/Concerns
Raw material availability at long-term benchmark terms, power at
affordable costs and access to key market segments are the key drivers
of growth. Company has drawn up plans that address all these concerns.
In the near to medium-term, significant factors will be full-load
operations, mitigating the risks of price fluctuations, ensuring
100% raw material feed and increasing market penetration of alloys.
Zinc market is bullish on LME prices and we expect prices to pick up
significantly.
The Company enjoys a high level of brand equity for its products. With
the focus on value adds Company's margins have been strengthened, while
offering value to quality-conscious customers.
To ensure that desired blend of concentrates is available, Company has
been pursuing a policy of tying up 60 - 70% of its feed through
long-term tie-up with principal traders. Balance is sought to be
covered through spot purchases.
2.2.5 Internal Controls relating to accounting system
The Company has adequate internal control systems. External agency has
been appointed for periodic internal audit to the Management Systems.
2.2.6 Human Resource Development / Industrial Relations
Employee hiring especially, recruitment of management trainees have
been done during the year. The recruitment process focused on
identifying talents from tier II institutes. Pertinent to say the
mixture of young minds with experience will bring BZL a facelift.
Focused and well driven employee engagement initiatives have smoothened
the employee relations during the period. A win-win situation in the
industrial relations space in the Company is being maintained which
brings healthy and productive work environment.
Safety and Environment initiatives were taken in the form of awareness
programmes, competitions; training programmes etc SHE initiatives
topped the agenda of the Company and its people. Our efforts in this
area were recognized and Binani Zinc bagged 1 National level and 3
state level safety awards from Government of Kerala and National Safety
Council during this year.
Retaining critical talent and acquiring new talent for meeting business
requirements was one of the biggest challenges last year.
Focused training programmes on topics/ areas assessed were undertaken
principally for knowledge and skill up gradation of operatives,
Management Development, Change Management programme for specific target
groups and "Seven habits of highly effective people" for selected
managers. Internal trainers also played an effective role. Management
Workshops on Personal & Professional Effectiveness' and Hazard and
Operability Studies rendered better results this year. Average time
spent on learning & development this year rose to 4.3 man days per
employee.
2.2.7 Corporate Social Responsibility
As part of its commitment to the society, the Company has extended
support for improving health and hygiene of the local people living in
and around the Company. Mainly through the launch-pad of Ghanshyam
Binani Occupational Health Centre and Ghanshyam Binani Community Hall.
This year also, Ghanshyam Binani Occupational Health Centre (GBHC)
catered to the health care / medical advice needs of employees, their
families, community around, besides rendering annual health check up
service to employees of several industries around.
Further the Company is also providing need based support around the
plant location focusing on education, medical and welfare. Corporate
Social Responsibility at Binani Zinc has evolved in to a new shape were
the participation of community living around are fully ensured.
GBHC. in partnership with Indian Medical Association and National
Safety Council, conducted State Level First Aiders training programme
this year; thus completing a total of 11 batches and training a total
of 392 industrial employees across industries in Kerala.
GBHC serves the community, employees and their family members through
Health Talks, Multi-Specialty Medical Camps and Medical Specialists'
Camps. GBHC continued to be recognized as "Centre of Public Health
Importance" this year also. Medical and nursing students regularly
visit here and through their extension service wings, serve the
community and school students.
Empowerment programmes for the children, women and the aged are
regularly conducted, and annual Camps are organized focusing on the
personality development of school children. Assemblages in the
Pakalveedu on all Tuesdays have become an active part of the 43-odd
old- aged of the community, where the meaningful presence of the Chief
Medical Officer and by Company officers is cherished by the inmates.
Rotary Binani CSR award was instituted by the Company with a view of
encouraging and inspiring other corporate to take up CSR activities.
This year also, Company's partnership interventions continued for the
Binanipuram Government High School students, where the SSLC students
bagged 100% results; thus repeating history in the sixth year in
succession. The Company's association with Government Hospital,
Binanipuram continued this year also.
2.2.8 Awards/ Recognition
The Company has won the National, Regional and State Level awards and
accolades:
2.3. GOA GLASS FIBRE LIMITED (GGFL)
2.3.1 Industry Overview
During 2011-12, the Industry faced pricing pressure due to cheaper
imports from China. India today is the fourth largest economy in the
world and the second fastest growing market in Asia. The fiberglass
demand in Indian Composites industry has increased at a rate more than
twice that of the GDP growth rate, reflecting the upbeat economy and
strong fundamental drives for growth. Within the composite sector
again, glass fibre is the dominant reinforcement materials with 85-90%
share compared to carbon, aramide and other fibres.
Major usage of fiberglass materials in Indian Composites Industry
occurs in Pipe & Tank, Transportation, Wind Energy and Construction
segments.
2.3.1 Financial Performance
(Rs in Lakhs)
Particulars 2011-12 2010-11
Gross Sales & Related Income 10,758 10,482
EBIDTA 1,266 1,273
Interest and Finance 1,209 942
Charges
Cash Profit / ( Loss) 57 331
Depreciation 1,383 1,238
Extra ordinary/ Prior period item 30 182
Net Profit / (Loss) before Tax (1,356) (1,089)
Net Profit / (Loss) after Tax (1,361) (1,089)
2.3.2. Performance Review:
Operations:
During the year under review, the Company has produced 14,926 MT.
Introduced a new product called "Wet used Chopped Strands" for Tissue
manufacturing.
Sales:
During the year, Company sold 13,386 MT with a revenue of Rs. 10,758
Lakhs as compared to sales of 14,429 MT and revenue of Rs. 10,482 Lakhs
in the previous year. The Finished Goods inventory at end of the year
31st March'12 is 2,386 MT.
2.3.3 Future Prospects
The Company focuses on optimizing the product mix with manufacture of
value-added products thereby attaining flexibility in product mix. This
will also maximize capacity utilization and maintain low operational
cost. Also focus on improving efficiencies based on automation of
certain processes.
In order to reduce Energy cost, the Company is targeting to avail
benefit of Natural Gas & improving reliability of power supply systems.
Adding to above, the Company is targeting to establish direct relations
with OEM customers and expand the existing Distribution Network for
better coverage & economy.
2.3.4 Swot Analysis
- Strengths
The Company has capability to incorporate different product mix and
developing know-how on latest technologies. The Flagship product
Chopped Strand Mat (CSM) of the Company continues to be well accepted
in the Global Market.
- Weakness
The Company's main weakness is the scale of operation which is small
and has a limited product range with a relatively high dependency on
CSM.
- Opportunities
There are many opportunities like availability of natural gas for
energy conservation, capability for brown field expansion at current
location to reduce the cost of production. Tie up with OEM's providing
another opportunity to the Company to increase reach and end-use of
product.
- Threats
The Major threat is appearing to be low scale of operation and high
cost of production due to high fuel prices. Plants coming up in Middle
East & India with large volumes.
2.3.5 Human Resources/ Industrial Relations
Industrial relations continued to be harmonious with the active
participation of the Union in all the programmes. Long term
settlements are in progress by healthy & amicable discussions. Various
training programmes were identified in technical and behavioral trades
as an employee development initiative.
As a part of corporate social responsibility, educational program with
respect to safety, health and environment was organized in nearby
village Colvale where we also conducted free medical camps.
2.4. BT COMPOSITES LIMITED (BTCL)
2.4.1 Financial Performance
(Rs in Lakhs)
Particulars 2011-12 2010-11
Net Sales and Other Income 598.74 584.30
Profit / (Loss) before (64.72) 19.52
Depreciation & Amortization and Interest
Interest and Financial 2.40 0.77
charges
Depreciation & Amortization 66.80 71.80
of Miscellaneous Expenses
Net Profit / (Loss) before (133.92) (53.05)
Extraordinary Items and Tax
Extraordinary Items 20.90 224.25
Provision for Taxation 0 0
Net Profit / (Loss)
for the year (154.82) (277.30)
Loss brought forward
(1,324.34) (1,047.04)
Loss carried to Balance Sheet (1,479.16) (1,324.34)
2.4.2 Review of Operations
During the year under review the products manufactured by the Company
were very well received in the markets. The net Sales and other Income
was at Rs. 598.74 Lakhs compared to Rs.586.75 Lakhs in the previous
year. During the year sales of SMC Molded Products was 317 MT as
compared to 317 MT in the last year.
During the year, prices of Raw materials (mainly resins), wages have
gone up steeply, but they said cost increase could not be passed on
fully to our customers due to severe competition. As a result, EBIDTA
for the year was at Rs. (64.72) Lakhs as compared to Rs. 19.52 Lakhs
last year.
The Company has carried out various process improvements to upgrade the
quality of the products. Efforts have been put in upgrading the raw
material selection and testing procedures to ensure consistency and
reliability of supplies. Introduction of woven roving in water tanks
further optimizes the product and effective saving of Rs 0.20 per litre
is achieved.
The product optimization shall help us more competitive in export
market.
2.4.3 Future Prospects
The Company has been able to focus on Private Construction companies
and South Central Railways.
The Company has been able to achieve good result of RCC/Steel tank
conversion to SMC (GRP) panel tanks in SC Railways and North Eastern
Railways. Presently Company is focusing on expanding sales operations
in Gulf countries where awareness of SMC (GRP) is already been
established.
We are specifying our products with engineering consultants so that we
can tap engineering segment, where our presence is not significant.
One of the products under development is pallet for material handling
applications. Initial feedback is encouraging. We have successfully
introduced SMC to cooling tower application. We are eying automotive
segment/bus body builders to convert present hand-lay- up applications
into SMC. We have also got reasonable success in selling chequered
plates and hope to do well in this segment.
2.5. WADA INDUSTRIAL ESTATE LIMITED (WIEL)
2.5.1 Financial Performance
(Rs in Lakhs)
Particulars 2011-12 2010-11
Other Income 0.40 0.33
Loss before tax (21.05) (24.14)
Loss brought forward from (446.06) (421.92)
last year
Balance Carried to Balance (467.11) (446.06)
Sheet
The Company is evaluating options for the effective use of the land for
developing it for commercial activities.
During the year under review the Company earned Income of Rs.0.40
Lakhsas compared to Income of Rs.
0.33 Lakhs earned in the previous year. During the year the Company has
incurred loss of Rs. 21.05 Lakhs as compared to Loss of Rs. 24.14 Lakhs
in the previous year.
2.6 BIL INFRATECH LIMITED [Wholly Owned Subsidiary of BIL]
2.6.1 Financial Performance (Rs in Lakhs)
Particulars For the Period from
Financial 29-07-2010
Year 2011-12 to 31.03.2011
Turnover 6,549.29 551.73
Profit/(Loss) before, 136.68 1.70
Depreciation, Interest,
extraordinary items and
Taxation.
Provision for 45.67 2.87
Depreciation
Profit/(Loss) before 91.01 (1.17)
interest, extraor
dinary items
and Taxation.
Interest and Financial 42.28 1.98
Charges
Profit/(Loss) before 48.73 (3.15)
Exceptional items and
Taxation
Provision for Taxation 14.09 Nil
including Deferred Tax
Profit/(Loss) after Tax 34.64 (3.15)
but before extraordinary
items
Extraordinary items Nil Nil
Profit/(Loss) for the year 34.64 (3.15)
2.6.2 Review of Operations
The Company was incorporated during the last quarter of 2010-11 with
the objective of becoming one of the leading EPC Company in the
Infrastructure sector.
During the year, the Company has secured nearly Rs.200 crores of
outside orders besides the order for building In-house Cement and Power
plants.
2.6.3 Future Prospects
The Company has already created alliance with a number of
internationally reputed technology providers to enhance its growth
rapidly.
2.7 BINANI READY MIX CONCRETE LIMITED[ Now Wholly Owned Subsidiary of
BCL)
2.7.1 Financial Performance
(Rs in Lakhs)
2011-12 2010-11
Net Sales & Other Income 1,874.62 207.01
Operating costs 2,217.56 224.77
EBIDTA (342.94) (17.76)
Interest & Financial Charges -- --
Cash Profit / (Loss) (342.94) (17.76)
Depreciation 6.03 0.39
Profit / (Loss)
before Tax (348.97) (18.15)
Profit / (Loss) after Tax (348.97) (18.15)
2.7.2. Performance Review
During the year under review, the Company has taken one plant on lease
at Thane. Thus, the Company was servicing its customers with two
plants. The sales volume for the year was 43859 Cum.
2.7.3. Industry Overview
During the year under review, the demand of Ready Mix Concrete (RMC)
has been moderate mainly driven by real estate projects lead by
housing. Due to slow down in launching Government projects and also
delay in approval of various projects the demand growth has been slowed
down. However, the industry demand growth in the long run remains
strong.
2.7.4. Future Plans
The long term plan of the Company to become a pan India player remains
unaltered.
The Company plans to set up 6 to 8 plants during the year 2012-13 in
Western and Northern part of the country.
2.8. R.B.G.MINERALS INDUSTRIES LIMITED - [Wholly Owned Subsidiary of
Binani Zinc Ltd.]
2.8.1 Review of Operations
The Company intends to develop 3 mines which are located near each
other in State of Rajasthan/Gujarat. In respect of Deri and Basantgarh
Mines the mining operations will commence on transfer of Ambaji Mine.
As regards Ambaji Mine the mining lease has been renewed in favour of
GMDC. GMDC Board and Government of Gujarat has approved the project as
a Joint Venture and Mine will be transferred after approval of
valuation of assets by GMDC Board which is expected by May 2012.
Further the land required for all the Mines has been acquired.
3. DIVIDEND
In view of the overall performance, prospects and income earned during
the year, your Directors recommend a dividend 030% (Rs.3/- per Equity
Share of Rs.10/- each), the outgo on dividend will be Rs.888 Lakhs.
4. DIRECTORS
In accordance with Article 100 of the Articles of Association of the
Company, Mr. Braj Binani, Director retires by rotation at the
forthcoming Annual General Meeting and being eligible, offers himself
for reappointment. Your Directors recommend re-appointment of Mr. Braj
Binani as Director on the Board of the Company.
During the year, the Board of Directors appointed Mr. V.Subramanian
and Mr. Sudhakar Rao as Additional Directors on the Board. They hold
office upto the date of the ensuing Annual General Meeting. The Company
has received notices from a shareholder along with a deposit of
Rs.500/- each proposing the appointment of Mr. V.Subramanian and Mr.
Sudhakar Rao as regular Directors at the ensuing 49th Annual General
Meeting. Your Directors recommend appointment of Mr V.Subramanian and
Mr. Sudhakar Rao as regular Directors on the Board of the Company.
During the year under review, Mr. S. Padmakumar, Dr. V.C.Shah and Mr.
A.C. Chakrabortti retired as Directors of the Company with effect from
20th November, 2011. The Directors wish to record their appreciation
for the significant and valuable contribution made by the Directors
during their tenure as Directors on the Board of the Company.
Further Ms. Shradha Binani has been appointed as an Alternate Director
to Ms. Nidhi Singhania.
5. AUDITORS' OBSERVATIONS
The management response to the Auditors observations in the Standalone
and Consolidated Accounts of the Company in respect of appointment of
Company Secretary is stated by way of Note No. 38 in notes to accounts
which is self explanatory.
6. EXIT OPPORTUNITY TO THE SHAREHOLDERS OF BINANI CEMENT LIMITED (BCL)
EXIT OFFER OF SHARES
Binani Cement Limited (BCL) had last year applied for delisting of the
shares from Bombay Stock Exchange Limited and National Stock Exchange
of India Limited. Both the Stock Exchanges have granted approval and
BCL's shares have been delisted with effect from 30th May, 2011 .
The Company has consequently sent an exit offer to the remaining public
shareholders to tender their shares in the exit offer. The exit offer
has been open from 30th May, 2011 and shall close on 29th May, 2012.
The exit offer payments are being made on fortnight settlement cycle
and till 31st March, 2012 the promoters shareholding has increased to
97.49%. The offer shall close on 29th May, 2012 and thereafter there
shall be no exit option for the shareholders.
7. AUDITORS
The Statutory Auditors, M/s. Kanu Doshi Associates, Chartered
Accountants, hold office up to the conclusion of the forthcoming Annual
General Meeting and have offered themselves for re-appointment. They
have confirmed that, if reappointed, their appointment will be within
the limits prescribed under Section 224(1 B) of the Companies Act,
1956. Your Directors recommend their re-appointment as Statutory
Auditors of the Company.
8. SUBSIDIARY COMPANIES
The Audited Accounts of the aforesaid Companies along with the report
of the Board of Directors and the Auditors Report thereon which are
required to be attached with the Annual Report of the Company have not
been attached as the Board of Directors have given consent not to
attach the Annual Accounts of the Company's Subsidiaries and step down
subsidiaries with the Annual Accounts of the Company in accordance with
the Ministry of Corporate Affairs, Government of India Circular No.
2/2011 dated 8th February, 2011 under Section 212 of the Companies Act,
1956.
The Statement pursuant to Section 212 of the Companies Act 1956,
relating to Company's subsidiaries and step down subsidiaries are
annexed to this report.
9. PARTICULARS UNDER SECTION 217 OF THE COMPANIES ACT,1956
The Statement of particulars under Section 217(1) (e) relating to
Conservation of Energy and Technology Absorption and activities
relating to Exports etc. are not applicable to the Company. Details of
foreign exchange earnings and outgo are annexed to this report. The
Statement of particulars of employees under Section 217 (2A) of the
Companies Act, 1956 read with Companies(Particulars of Employees)
Rules, 1975 (as amended) is annexed herewith and form part of this
report.
10. CORPORATE GOVERNANCE
In accordance with Clause 49 of the Listing Agreement, your Company has
ensured continued compliance of Corporate Governance requirements
during the Financial Year. Your Company lays strong emphasis on
transparency and independent supervision to increase various
Stakeholders' value.
The Report on Corporate Governance for the Financial Year 2012-2013 is
given as a separate Section titled "Corporate Governance Report". As
required under the said clause, a certificate from the Practicing
Company Secretary, M/s. Uma Lodha & Co. has been obtained. The
Certificate is appended herewith and form part of this report.
11. MANAGEMENT DISCUSSIONS & ANALYSIS
The Management Discussion and Analysis form part of this report.
12. FIXED DEPOSIT
During the year, your Company has neither invited nor accepted/renewed
deposits from the public within the meaning of Sections 58A, 58AA and
other applicable provisions of the Companies Act, 1956.
13. DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with Section 217 (2AA) of the Companies Act, 1956 the
Directors state that:-
a) in the preparation of the annual accounts , all applicable
Accounting Standards have been followed and proper explanation relating
to material departures, if any, have been furnished;
b) accounting policies as listed in Note 2 to the financial statements
have been selected and consistently applied and prudent judgments and
estimates have been made so as to give a true and fair view of the
state of affairs of the Company as on 31st March, 2012 and of the
Profit of the Company for the Accounting Year ended on that day;
c) proper and sufficient care for the maintenance of adequate
accounting records has been taken in accordance with the provisions of
this Act so as to safeguard the assets of the Company and to prevent
and detect fraud and other irregularities; and
d) the annual accounts have been prepared on a going concern basis.
14. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
The Company and its all subsidiaries have effective internal control
systems which are evaluated periodically by the Internal Auditors and
the systems are adequate commensuration with the operations of each of
the Companies.
15. ACKNOWLEDGEMENT
Your Directors are pleased to acknowledge the assistance and
co-operation received from the concerned departments of the State and
Central Government, Financial Institutions, Banks, Customers, Selling
Agents, Dealers, Distributors, Employees at all levels and the
Shareholders.
For and on behalf of the Board
Mumbai BRAJ BINANI
21st April, 2012 CHAIRMAN
Mar 31, 2011
The Directors present the Forty Eighth Annual Report of the Company
together with the Audited Statement of the Accounts for the year ended
31st March, 2011
1. FINANCIAL PERFORMANCE
(Rs. in Lacs)
Particulars Year ended Year ended
31.3.2011 31.03.2010
Sales/Profit on sale of fixed 8,591 5,104
assets, investments/ other
Income
Profit before, Depreciation, 4,570 2,216
Interest, extraordinary Items
and Taxation.
Provision for Depreciation 40 27
Profit before Interest, 4,530 2,189
extraordinary Items and
Taxation
Interest and Financial 3,384 524
Charges
Profit before Exceptional 1,146 1,665
items and Taxation
Provision for Taxation - -
including Deferred Tax and
Fringe Benefit Tax
Profit After Tax but before 1,146 1,665
extraordinary items
Extra Ordinary Items - -
Profit for the year 1,146 1,665
APPROPRIATIONS /
ADJUSTMENTS
Transfer to General Reserve (115) (167)
Proposed Dividend (888) (888)
Tax on Dividend NIL NIL
(Loss) brought forward from (3,198) (3,975)
last year
Adjusted with credit balance 115 167
of General Reserve
(Loss) carried to balance (2,940) (3,198)
sheet
Previous years figures have been regrouped/reclassified wherever
necessary.
3. Dividend
In view of the overall performance, prospects and income earned during
the year, your Directors recommend a dividend @30%(Rs.3/- per Equity
Share of Rs.10/- each), the outgo on dividend will be Rs.888 Lacs.
4. Directors
In accordance with Article 100 of the Articles of Association of the
Company, Mr. N.C.Singhal and Ms. Nidhi Singhania, Directors retire by
rotation at the forthcoming Annual General Meeting and being eligible,
offer themselves for reappointment. Your Directors recommend
re-appointment of Mr. N.C.Singhal and Ms. Nidhi Singhania as Directors
on the Board of the Company.
During the year, the Board of Directors appointed Mr. Jitender
Balakrishnan as an Additional Director on the Board. Mr. Jitender
Balakrishnan holds office upto the date of the ensuing Annual General
Meeting. Company has received a notice from a Shareholder along with a
deposit of Rs.500 proposing the appointment of Mr. Jitender
Balakrishnan as regular Director at the ensuing 48th Annual General
Meeting of the Company. Your Directors recommend appointment of Mr.
Jitender Balakrishnan as regular Director on the Board of the Company.
5. Auditors Observations
The management response to the Auditors observations in the
consolidated Balance Sheet in respect of Binani Zinc Limited is given
below.
5.1 Binani Zinc Limited (BZL)
Regarding the pre-82 tariff concession, as clarifed in Note No. 10 of
Schedule 16 (Notes to Accounts), the management is of the view that the
Company is entitled to the concession which is sub-judice and hence no
provision has been considered necessary.
6. Exit opportunity to the shareholders of Binani Cement Limited
During the year, the Company had given exit opportunity to the public
shareholders of Binani Cement Limited (BCL) for the acquisition of
equity shares under the SEBI (Delisting of Equity Shares) Regulations,
2009, (Delisting Regulations). The delisting offer was successful and
the Company received 268 valid bids from BCL Shareholders for
4,73,58,222 shares. The Company has acquired shares of BCL at the price
of Rs, 90/- which was determined through the reserve book building
process and paid the entire consideration to the shareholders of BCL
who had bid in the reverse book building process in terms of the
delisting regulations. Consequent upon the success of the offer, the
shareholding of the Company in BCL has increased to 95.01% of the total
paid up and issued sharecapital of BCL.
7. Auditors
The Statutory Auditors, M/s. Kanu Doshi Associates, Chartered
Accountants, hold office upto the conclusion of the forthcoming Annual
General Meeting and have offered themselves for re-appointment. They
have confrmed that, if reappointed, their appointment will be within
the limits prescribed under Section 224(1B) of the Companies Act, 1956.
Your Directors recommend their re-appointment as Statutory Auditors of
the Company.
8. Subsidiary Companies
The Statement pursuant to Section 212 of the Companies Act 1956,
relating to Companys subsidiaries and step down subsidiaries are
annexed to this report.
The Audited Accounts of the aforesaid Companies along with the report
of the Board of Directors and the Auditors Report thereon which are
required to be attached with the Annual Report of the Company have not
been attached as the Board of Directors have given consent not to
attach the Annual Accounts of the Companys Subsidiaries and step down
subsidiaries with the Annual Accounts of the Company in accordance with
the Ministry of Corporate Affairs, Government of India circular No.
2/2011 dated 8th February, 2011 under Section 212 of the Companies Act,
1956.
9. Particulars under Section 217 of the Companies Act,1956
The Statement of particulars under Section 217(1) (e) relating to
Conservation of Energy and Technology Absorption and activities
relating to Exports etc. are not applicable to the Company. Details of
foreign exchange earnings and outgo are annexed to this report. The
Statement of particulars of employees under Section 217 (2A) of the
Companies Act, 1956 read with Companies(Particulars of Employees)
Rules, 1975 (as amended) is annexed herewith and form part of this
report.
10. Corporate Governance
In accordance with Clause 49 of the Listing Agreement, your Company has
ensured continued compliance of Corporate Governance requirements
during the financial year. Your Company lays strong emphasis on
transparency and independent supervision to increase various
Stakeholders value.
The Report on Corporate Governance for the financial year 2010-2011 is
given as a separate Section titled "Corporate Governance Report". As
required under the said clause, a certifcate from the Practicing
Company Secretary, M/s. Uma Lodha & Associates has been obtained. The
Certifcate is appended herewith and form part of this report.
11. Management Discussions & Analysis
The Management Discussion and Analysis form part of this report.
12. Fixed Deposit
During the year, your Company has neither invited nor accepted/renewed
deposits from the public within the meaning of Sections 58A, 58AA and
other applicable provisions of the Companies Act, 1956.
13. Directors Responsibility Statement
In accordance with Section 217 (2AA) of the Companies Act, 1956 the
Directors state that:- a) in the preparation of the annual accounts ,
all applicable Accounting Standards have been followed and proper
explanation relating to material departures, if any, have been
furnished;
b) accounting policies as listed in Schedule 12 to the financial
statements have been selected and consistently applied and prudent
judgments and estimates have been made so as to give a true and fair
view of the state of affairs of the Company as on 31st March, 2011 and
of the Profit of the Company for the Accounting Year ended on that day;
c) proper and suffcient care for the maintenance of adequate accounting
records has been taken in accordance with the provisions of this Act so
as to safeguard the assets of the Company and to prevent and detect
fraud and other irregularities; and
d) the annual accounts have been prepared on a going concern basis.
14. Internal Control System and their Adequacy
The Company and its all subsidiaries have adequate internal control
systems which are evaluated periodically by the Internal Auditors and
the systems are adequate commensurating with the operations of each of
the Companies.
15. Acknowledgement
Your Directors acknowledge the assistance and co- operation received
from the concerned departments of the State and Central Government,
Financial Institutions, Banks, Customers, Selling Agents, Dealers,
Distributors, Employees at all levels and the Shareholders.
For and on behalf of the Board
Mumbai Braj Binani
22nd April, 2011 Chairman
Mar 31, 2010
The Directors present the Forty Seventh Annual Report of the Company
together with the Audited Statement of the Accounts for the year ended
31st March, 2010.
1. Financial Performance
(Rs in Lakhs)
Particulars Year Year
ended ended
31.03.2010 31.03.2009
Sales/Profit on sale of fixed 5,104 5,118
assets, investments/other Income
Profit before, Depreciation,
Interest, extraordinary Items and 2,216 2,859
Taxation.
Provision for Depreciation 27 33
Profit before Interest,
extraordinary 2,189 2,826
Items and Taxation
Interest and Financial Charges 524 702
Profit before Exceptional items 1,665 2,124
and Taxation
Provision for Taxation including
Deferred Tax and Fringe Benefit - 13
Tax
Profit after Tax but before 1,665 2,111
extraordinary items
Extra ordinary Items - 1,266
Profit for the year 1,665 3,377
APPROPRIATIONS/ADJUSTMENTS
Transfer to General Reserve (167) (350)
Proposed Dividend (888) (888)
Tax on Dividend NIL Nil
(Loss) brought forward from last (3,975) (6,464)
year
Adjusted with credit
balance of 167 350
General Reserve
(Loss) carried to balance sheet (3,198) (3,975)
Previous yearsà figures have been regrouped/reclassified wherever
necessary.
1.1 Review of Operations
The Company being a holding company has no manufacturing activities.
Its main source of income is Dividend from its Subsidiaries and income
earned by providing Management and support services to all its
Subsidiaries in the areas of Accounts, Finance, Treasury, Audit,
Forex/Commodity, Risk Management, Purchase, Taxation, Corporate
Strategy, Media Services, Project Management, etc. During the year
under review, Company received from its Subsidiary, Binani Cement
Limited, dividend income of Rs. 2,768 Lakhs and Management Services fee
from all its subsidiaries aggregating to Rs. 2,300 Lakhs. During the
year, the Company earned a Net Profit of Rs. 1,665 Lakhs, compared to
Rs. 3,377 Lakhs in the previous year. Out of the profit of Rs. 1,665
Lakhs, Rs. 167 Lakhs has been transferred to General Reserve.
1.2 Future Prospects
The CompanyÃs flagship Subsidiary, Binani Cement Limited (BCL) has done
exceptionally well and is expected to maintain the exceptional
performance in the coming years as well. Binani Zinc Limited (BZL) has
also done reasonably well and has earned a Net profit of Rs.169 lakh.
As the LME prices has increased gradually during the year and has now
become stable, it is expected that BZLÃs performance in the coming
years will be reasonable. Goa Glass Fibre Limited (GGFL) has not done
well and has incurred losses during the year. This was mainly due to
dumping of Glass Fibre Products by China in the Country. Besides,
submitting representation to the Government of India to levy Anti
Dumping Duty on the Glass Fibre products, Company has taken remedial
measures to improve both the production and sales of glass fibre
products and also measures to reduce costs. With the above measures, it
is expected to pull out itself from the present situation, in the
coming years.
2. SUBSIDIARIES
We present below a brief report on the operations of CompanyÃs major
subsidiaries:
2.1. BINANI CEMENT LIMITED (BCL)
2.1.1 Industry Overview
The Cement Sector is expected to grow by 9-10% in the Financial Year
2010-11 compared to IndiaÃs expected GDP of 8.5%. The housing and
construction sector generates 50% of the overall demand of cement in
the country and the demand is expected to continue in the coming years
as well. But the expected capacity additions, increased cost of raw
material, fuel and logistics, proposed service tax on housing sector
and gradual withdrawal of stimulus package granted to the Cement
Industry will have pressure on margins in the coming years.
2.1.2 Financial Performance
The financial performance for the year ended 31st March, 2010 is
summarized below:
Rs. in Lakhs
Particulars 2009-10 2008-09 % Change
Sales & Other Income 1,87,216 1,50,270 25
EBIDTA 59,178 30,639 93
Cash Profit 51,327 23,487 119
Profit before Tax 40,800 15,456 164
Profit after Tax 28,192 10,867 159
2.1.3 Review of Operations
During the year under review, the company surpassed all previous bests
in all areas and continue to maintain its growth path. Company produced
52.80 lac MT of cement compared to 42.92 Lac MT in the previous year,
an increase of 23%. Sales was 52.95 lac MT compared to 42.43 MT in the
previous year, an increase of 25%, Captive power generation was
2,449.07 lac KWh (net) compared to 1,876.39 lac KWh in 2008-09. Profit
before Tax was the highest ever at Rs.40,800 Lakhs, an impressive
growth of 164% compared to Rs.15,456 Lakhs during 2008-09. The higher
profit could be achieved mainly due to increase sales volumes, low coal
price and higher net realization.
2.1.4 Future Outlook
Growth in domestic cement demand is expected to remain strong, given
the revival in the housing sector, continued Government spending on the
rural infrastructure, and gradual increase in the number of
infrastructure projects being executed by the private sector. The trend
in demand growth seen during the last five years is expected to
continue over the medium term. Further, with Government targeting 8-10%
GDP growth rate, cement demand should grow at 9-10% over the next few
years.
The key drivers of Cement Industry in India are:
- Buoyant real estate market in non metro cities;
- Increase in infrastructure spending in power, road, port and urban
infrastructure;
- Increase in rural demand driven by National Rural Employment
Guarantee Act (NREGA);
- Low-cost housing in urban and rural areas under schemes like
Jawaharlal Nehru National Urban Renewal Mission (JNNURM) and Indira
Aawas Yojana;
- Favourable interest rates and tax benefits on housing.
- Domestic Industrial growth and major expansion plans announced across
different segments;
2.1.5 Project Overview Expansion Projects/Railway Sidings
Binanigram Unit : During the year, the 4th Cement Mill of 110 TPH
capacity was commissioned in December 2009. Packing plant expansion by
installation of fifth packer and four additional truck loaders
completed in JanuaryÃ10. 22.3 MW Captive Power Plant (Unit II)
commissioned in the month of June 2009.
Further, to achieve enhanced capacity upto 8,000 TPD from Kiln II and
to enable the use of Pet coke, following modifications in the plant are
under progress:
- Upgradation of existing Pre-heater fans;
- Modification of Raw Mill-II separator;
- Building construction for installation of pre-crushing system for
reduction of feed size.
Up-gradation of wagon loading system is being undertaken by introducing
third loading point with four additional wagon loaders. This will
reduce rake loading time increase dispatches through railway resulting
in savings in costs. Proposed expansion of railway yard by adding
fifth line for clinker/coal/gypsum handling.
Neem Ka Thana unit:
Wagon unloading for clinker with wagon tippler started in the month of
September 2009. Balance work of railway siding is under progress,
expected to be completed by Aprilà 2010. Work of 132 KVA power line is
in progress and is expected to be completed by JuneÃ10.
Overseas Projects
Shandong Binani RongÃAn Cement Co. Ltd, China (SBRCC)
SBRCCL, China plant capacity is being expanded from the present 0.5
MTPA to 3.0 MTPA. Land has been acquired and necessary Government
permission from the Republic of China have been received. Orders for
the plant and machinery have been placed on the local Chinese Company
on a turnkey basis. Contract for civil construction has also been
awarded. The Project is expected to be commissioned in the first half
of 2011.
Binani Cement Factory LLC, Dubai ( BCFLLC)
The project for expanding the capacity for Cement Grinding from 1.2
MTPA to 2.00 MTPA has been completed during the year. But the
construction industry in Dubai suffered a serious setback in the 2nd
half of 2009 resulting in a slump in the demand of cement and the price
of Cement also fell sharply. The construction industry in Dubai is not
expected to improve in the near future. But there is substantial demand
of Cement in the neighbouring Middle East Countries and in Africa. To
capitalize on the demand of Cement in Africa and other neighbouring
Countries, the Company plans to set up marketing offices through its
subsidiaries. Further, the Company is setting up a 1.00 MTPA cement
grinding unit at Mauritius.
2.1.6 Future Plans
Cement Project at Sutrapada, Dist, Junagad in Gujarat The Company
proposes to set up a Greenfield Cement plant of 2.5 million tonnes per
annum capacity.
Orders for the long delivery major equipment and the engineering for
the project have been initiated. No further progress could be made as
CompanyÃs application for the lease of mines and government land for
the plant are held up pending revision of the mineral policy by
Government of Gujarat. Although, the Government of Gujarat has
announced the new mineral policy, the notification of ML blocks for
Saurashtra is yet to be finalized.
Lignite Project at Nimbri-Chandawatan Dist. Nagaur, Rajasthan
The Government of India allocated lignite Block in Dist-Nagaur,
Rajasthan on 7th February, 2007 for use of lignite as raw material
captively for power generation. 64 Ha private Land has been acquired by
the Company for the project. Most of the Government clearances for the
setting up of the project have been obtained. Site location for 120 MW
Power Plant has been finalized. The project is expected to be completed
by March, 2011.
2.1.7 Internal Control System
The management maintains adequate internal controls commensurate with
the nature and size of operations of the company, which is designed to
provide reasonable assurance that assets are safe-guarded, transactions
are correctly executed and recorded in accordance with managementsÃ
authorization, applicable accounting standards and selected accounting
policies which are being applied consistently. The companyÃs ÃSAPÃ
software at its works and in marketing functions is working
satisfactorily. To further strengthen the internal controls and
integration, the company is in the process of implementing plant
maintenance and Human Capital Management (HCM) and payroll system. Also
to document the procedures, the company is in the process of
preparation of SOP document.
The companyÃs internal control system provides high level of system
based checks and controls. Regular internal audits and checks ensure
that responsibilities are executed efficiently. The Audit Committee of
the Board of Directors review the adequacy and effectiveness of
internal control system and suggest improvement for strengthening them,
from time to time.
2.1.8 Opportunities/Risks/Threats/Concerns
Opportunities
Despite second largest producer of Cement in the world after China,
IndiaÃs per capita consumption of Cement is very low to about 130 Kg
per year, much lower than the global average of about 355 Kg, leaving
large room for growth .The Company with its brand image, large dealer
network and being a major player in Rajasthan and Gujarat will continue
its participation in this growth. Industry will receive a further boost
by increased Government and Private Sector spending on infrastructure.
Threats, Risks and Concerns
Large capacity additions, increasing cost of inputs, gradual withdrawal
of stimulus granted to Industry, inflation and upward trend in interest
rates may have pressure on margins in the medium term affecting the
bottomline of the Company in the coming years.
2.1.9 Recognition & Rewards
During the year 2009-10, the company received following
awards/recognitions: NCCBM instituted National Award for Energy
Efficiency in Indian Cement Industries in recognition of the Best
Electrical Energy & the Best Thermal Energy Performance for the year
2007-08 and National Quality Excellence Award 2008-09 in Indian Cement
Industries in recognition towards its excellence in the field of
Quality Management.
ITC CII Sustainability Award 2009 for significant contribution in the
field of environment, society and economics.
Greentech Environment Excellence Gold Award 2009 in recognition of its
exemplary initiatives in Environment Management.
CII Godrej Green Business Centre, Hyderabad instituted National Award
for Excellence in Water Management 2009 and Energy Management 2009 for
ÃExcellent Water Efficient Unità and ÃEnergy Efficient UnitÃ.
Certificate of Merit for 2007-08 for Productivity Improvements in
recognition of companyÃs sustained initiatives towards productivity
improvements.
Certificate of Excellence à Best Employer Award Competition 2008 in
recognition of companyÃs excellence towards maintaining good
Employee-Employer Relationship for the year 2008.
All India Business & Community Foundation (AIBCF) instituted Udyog
Bharati Award 2009 and Indian Achievers Award for Quality Excellence
for entrepreneurship development leading to economic growth that
greatly contributes to generate long term opportunities for the
communities.
2.1.10 Corporate Social Responsibility
As a responsible corporate, the Company continues to adopt best CSR
practices. In the recent past, the Company has joined hands with M/s
RBKS, an NGO for initiating an integrated village development programme
titled ÃLife Skill Education to Communityà covering 5 of the nearby
adivasi villages viz., Amli, Thandiberi, Malap, Sabela and Varli. The
joint venture is aimed at achieving the objective of provision of food
and shelter, closed toilets, use of smokeless stoves, to motivate the
villagers towards plantation with a view to divert them from
deforestation, provision of training to Adivasis on stitching of
traditional dresses which can be sold to consumers through cooperative
societies and cattle & poultry development. The programme will not only
improve life style of target villagers but also cater to their
financial needs.
Besides, the company continues to provide necessary support to
economically backward people of the adjoining villages through various
community development, education and health care programmes. These
include providing donation/ contributions, small constructions,
repairing works, etc. Drinking water is being also supplied to local
people in the summer.
The Binani Ladies Club regularly contributes towards community
development and charities through distribution of school uniforms,
books, clothes to needy tribal people and blankets, mattresses and
pillows to Adivasi hostel at Pindwara.
2.1.11 Human Relations/Industrial Relations
Employees of the Company are the key assets and the company
continuously strives towards the development of its employees, to
upgrade their skills and to boost the motivation levels of its human
resources through various mechanisms. This reflects in the fact that on
an average 3.70 man days per person have been spent on training during
the year under review.
Employees are motivated and team spirit strengthened through various
departmental quality circles and other awareness programmes being
organized from time to time. The company continues to maintain healthy
working environment and cordial industrial relations throughout the
year. In order to encourage total employees involvement in the
production process, Company has introduced ÃEmployee of the MonthÃ
scheme, which inspire employees to be innovative.
The efforts put in by employees at all levels have contributed to the
excellent performance of the company. Employee/Industrial Relations
have been cordial during the year.
2.1.12 Subsidiaries of Binani Cement Limited
Shandong Binani Rong An Cement Company Ltd. China (SBRCC) Shandong
Binani Rong An Company Ltd. is a Company incorporated under the laws of
peoples Republic of China. At present, the Company has facilities for
manufacture of 0.5 milion TPA Cement at Shandong Province of China
which is being expanded by a further 2.5 Million TPA.
Binani Cement Factory LLC, Dubai (BCFLLC)
Binani Cement Factory LLC is a Company incorporated under the laws of
United Arab Emirates. The Company has facilities for the manufacture of
2 MTPA of Cement grinding capacity.
Krishna Holdings Pte Ltd., Singapore (KHL)
KHL is an investment Company incorporated in Singapore. The Company
holds 50% investment in KHL. The balance 50% is held by MHL.
Mukundan Holdings Limited, BVI (MHL)
MHL is an investment Company incorporated in British Virgin Islands.
MHL is a wholly-owned subsidiary of the Company. MHL holds 49% shares
in Binani Cement Factory LLC, Dubai.
Murari Holdings Limited, BVI (MUHL)
Mu HL is an investment Company incorporated in British Virgin Islands
for holding 51% of the beneficial interest in the paid up share capital
of BCFLLC. Mu HL is a wholly-owned subsidiary of the Company.
Bhumi Resources (Singapore) Pte. Ltd., Singapore (BRSL)
BRSL is a Company incorporated in Singapore for acquisition of Coal
Mines in Indonesia, Coal being a critical raw material for energy for
the Company. BRSL is a wholly owned subsidiary of the Company.
6. Auditors
The Statutory Auditors, M/s. Kanu Doshi Associates, Chartered
Accountants, hold office upto the conclusion of the forthcoming Annual
General Meeting and have offered themselves for re- appointment. They
have confirmed that, if reappointed, their appointment will be within
the limits prescribed under Section 224(1B) of the Companies Act, 1956.
Your Directors recommend their re-appointment as Statutory Auditors of
the Company.
7. Subsidiary Companies
The Statement pursuant to Section 212 of the Companies Act 1956
relating to CompanyÃs subsidiaries and stepdown subsidiaries viz.Binani
Cement Limited, Goa Glass Fibre Limited, Binani Zinc Limited, BT
Composites Limited, Ess Vee Alloys Pvt. Limited, Wada Industrial Estate
Limited, R.B.G. Minerals Industries Limited, Binani Energy Pvt.
Limited, Binani Cement Factory LLC, Dubai, Shandong Binani Rong An
Cement Co. Ltd., China, Krishna Holding Pte. Limited Singapore,
Mukundan Holdings Limited, Murari Holdings Limited, Bhumi Resources
(Singapore) Pte Ltd.,Sankalp Holdings Limited and Abhinav Holdings Ltd.
are annexed to this report.
The Audited Accounts of the aforesaid Companies along with the report
of the Board of Directors and the Auditors Report thereon which are
required to be attached with the Annual Report of the Company have not
been attached as the Department of Corporate Affairs, Government of
India have granted exemption to the Company from attaching the
aforesaid documents of the aforesaid subsidiaries pursuant to Section
212(8) of the Companies Act, 1956. Bhumi Resources(Singapore) Pte Ltd.
which was incorporated on 26th October, 2009 and its first Accounting
period will end on 31st December, 2010. In the absence of Financial
Statement of BRSL as on 31st March, 2010, the financial statement have
not been considered for consolidation and therefore not attached.
8. Particulars under Section 217 of the Companies Act,1956
The Statement of particulars under Section 217(1) (e) relating to
Conservation of Energy and Technology Absorption and activities
relating to Exports etc. are not applicable to the Company. Details of
foreign exchange earnings and outgo are annexed to this report. The
Statement of particulars of employees under Section 217 (2A) of the
Companies Act, 1956 read with Companies(Particulars of Employees)
Rules, 1975 (as amended) is annexed herewith and form part of this
report.
9. Corporate Governance
In accordance with Clause 49 of the Listing Agreement, your Company has
ensured continued compliance of Corporate Governance requirements
during the financial year. Your Company lays strong emphasis on
Transparency and Independent supervision to increase various
stakeholdersà value.
The Report on Corporate Governance for the financial year 2009-2010 is
given as a separate Section titled ÃCorporate Governance ReportÃ. As
required under the said Clause, a Certificate from the Statutory
Auditors of the Company has been obtained. The Certificate is appended
herewith and form part of this Report.
10. Management Discussions & Analysis
The Management Discussion and Analysis form part of this Report.
11. Fixed Deposit
During the year, your Company has neither invited nor accepted/renewed
deposits from the public within the meaning of Sections 58A, 58AA and
other applicable provisions of the Companies Act, 1956.
12. Directorsà Responsibility Statement
In accordance with Section 217 (2AA) of the Companies Act, 1956 the
Directors state that:- a) in the preparation of the annual accounts,
all applicable Accounting Standards have been followed and proper
explanation relating to material departures, if any, have been
furnished.
b) accounting policies as listed in Schedule 16 to the financial
statements have been selected and consistently applied and prudent
judgments and estimates have been made so as to give a true and fair
view of the state of affairs of the Company as on 31st March, 2010 and
of the Profit of the Company for the Accounting Year ended on that day.
c) proper and sufficient care for the maintenance of adequate
accounting records has been taken in accordance with the provisions of
this act so as to safeguard the assets of the Company and to prevent
and detect fraud and other irregularities and the annual accounts have
been prepared on a going concern basis.
d) the annual accounts have been prepared on a going concern basis.
13. Internal Control System and their Adequacy
The Company and all its subsidiaries have adequate internal control
systems which are evaluated periodically by the Internal Auditors and
the systems are adequate commensurating with the operations of each of
the Companies.
14. Acknowledgement
Your Directors acknowledge the assistance and co-operation received
from the concerned departments of the State and Central Government,
Financial Institutions, Banks, Customers, Selling Agents, Dealers,
Distributors, Employees at all levels and the Shareholders.
For and on behalf of the Board
Place : Mumbai Braj Binani
Date : 23rd April, 2010 Chairman
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