Mar 31, 2018
Dear Members,
The Directors have pleasure in presenting the Twenty Fifth Annual Report of the Company together with the Audited Annual Accounts for the year ended 31st March, 2018.
1. FINANCIAL AND OPERATIONAL PERFORMANCE:
a. Financial Results
Financial and Operational Results of the Company for the year ended 31st March, 2018 as compared to the previous financial year, is summarized below:
(Rs. in crores)
Particulars |
Standalone For the Financial Year Ended |
||
31-03-2018 |
31-03-2017 |
||
Revenue from Operations |
3088.36 |
3876.96 |
|
Profit before Interest, Depreciation and Tax |
218.58 |
620.74 |
|
Less: Interest |
422.12 |
671.75 |
|
Profit/(Loss) before Depreciation and Tax |
(203.54) |
(51.01) |
|
Less: Depreciation and Amortization |
(154.80) |
(161.51) |
|
Profit / (Loss) before Tax |
(358.34) |
(212.52) |
|
Tax Provisions |
76.27 |
61.29 |
|
Profit / (Loss) after tax |
(282.07) |
(151.23) |
b. Operations:
The total sales of the Company for the year under review were Rs. 3088.36 crores as compared to Rs. 3876.96 Crores in previous financial year lower by approx. 20%. The reduction in sales is due to general market conditions and stress on working capital. The net loss after tax for the year under review was Rs.282.07 crores, compared to loss of Rs. 151.23 crores of previous financial year.
c. Report on Performance of Subsidiaries:
A report on the performance and financial position of each of the subsidiaries are provided as Annexure - I and forms part of this report.
Additional information on Subsidiary companies:
i. Bombay Rayon Holdings Limited (BRHL)
BRHL holds 100% Equity of foreign subsidiaries i.e. BRFL Italia S.R.L. &, BRFL Italia Licensee S.R.L.
BRHL registered a net Profit of Rs. 3.77 crores for the year ended March 31, 2018.
ii. STI India Limited (STI).
The Company is running the unit of STI on job work basis for the manufacturing of yarn and knitted fabric. The manufactured yarn is used for captive consumption and some part is sold in the open market.
STI registered a net Loss of Rs. 7.33 crores for the year ended March 31, 2018.
iii. DPJ Clothing Ltd, U.K.
DPJ Clothing Limited is engaged in business of wholesale marketing and distribution of clothing products. However, at present, there are no operations being conducted.
iv. BRFL Italia S.R.L, Italy.
The Company owns the brand âGURUâ for readymade garments as well as for other accessories.
The retail operations, being not viable in the current prevailing economic scenario, are totally closed and the company is in process of rearrangements.
v. BRFL Italia Licensee S.R.L, Italy.
BRFL Italia licensee S.R.L is presently having the licenses for brand âGURU.â The operations are presently suspended.
vi. BRFL Bangladesh Private Limited.
The Company has not commenced its operations.
d. Consolidated Accounts
The Consolidated Financial Statements of your Company for the financial year 2017-18 have been prepared in compliance with applicable provisions of the Companies Act, 2013 read with the Rules issued thereunder, applicable Accounting Standards and the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as the âListing Regulationsâ). The consolidated financial statements have been prepared on the basis of audited financial statements of your Company and audited and/or provisional financial statements of its subsidiaries, as approved by the Board of Directors of the said Companies. The Consolidated Financial Statement does not include the financials of BRFL Italia S.r.l, BRFL Italia Licensee S.r.l, DPJ Clothing Limited & BRFL Bangladesh Pvt Limited as the financials statements of these companies are not available due to suspension of operations.
e. Dividend:
In view of the losses incurred during the year under review, the Board of Directors have not recommended any dividend for the financial year ended March 31, 2018.
f. Transfer to reserve:
In view of loss incurred during the year under review, the Board of Directors has not recommended any amount to be transferred to Reserves.
2. DISCLOSURE OF INTERNAL FINANCIAL CONTROLS:
The Internal Financial Controls with reference to financial statements as designed and implemented by the Company are adequate. During the year under review, no material or serious observation has been received from the Internal Auditors of the Company for inefficiency or inadequacy of such controls.
3. PARTICULARS OF LOANS, GUARANTEES,
INVESTMENTS AND SECURITIES:
Full Particulars of Loans & Guarantees Given, Investments made and Securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the financial statement (Please refer to Notes of the Standalone Financial Statements.)
4. PARTICULARS OF CONTRACTS/ ARRANGEMENTS/ TRANSACTIONS WITH RELATED PARTIES:
All contracts / arrangements / transactions, falling within the purview of Section 188 of the Companies Act, 2013, entered into by the Company during the financial year with related parties were in the ordinary course of business and on an armâs length basis. None of the transactions entered into by the Company with related party were material in nature exceeding the limit 10% of annual standalone/consolidated turnover of the Company.
The particulars of contracts or arrangements with related parties are forming part of Notes to Accounts in this Annual Report.
All Related party transactions are placed before the Audit Committee and subsequently before the Board for its approval. Omnibus approval is obtained on yearly basis for transactions which are of repetitive nature as per the policy on Materiality of and Dealing with Related Party Transactions. The policy on related party transactions as approved by the Board of Directors has been uploaded on the website of the Company.
5. PAYMENT TO BANKERS AND STATUTORY AUTHORITIES:
During the year under review, there were delays in payment of dues to bankers as well as to statutory authorities.
6. MATTERS RELATED TO CHANGE IN DIRECTORS AND KEY MANAGERIAL PERSONNEL AND DECLARATION BY INDEPENDENT DIRECTORS:
a. Changes in Board of Directors & Key Managerial Personnel:
I. Vacation of Office
During the year, there were no changes in the Directors or Key Managerial Personnel of the Company.
After the end of the financial year, Mr. Janardhan Agrawal, Chairman, due to his age & health factors, has expressed his inability to continue as the Chairman & Director in the Company and has tendered his resignation w.e.f 19th April 2018. Mr. Janardhan Agrawal was the founder of Bombay Rayon and has steered the growth of the Company. The Board of Directors placed on record, the fact that Mr. Janardhan Agrawal the founder of the Bombay Rayon has remained a guiding strength to make the company as a force to reckon by his leadership in the textile industry of India and expressed its gratitude and appreciation for his contribution and guidance in building up the Organisation.
Consequent to the resignation of Mr. Janardhan Agrawal, Mr. Aman Agrawal has been appointed as the Chairman of the Company by the Board of Directors in its meeting held on 29th May, 2018.
II. Directors Retiring by Rotation
Pursuant to the provisions of Section 152 of the Companies Act, 2013, Mr. Aman Agrawal and Mr. Prashant Agrawal Directors shall retire by rotation at the ensuing Annual General Meeting of the Company and being eligible, have offered themselves for re-appointment. In accordance with the provisions of the Act, none of the Independent Directors is liable to retire by rotation.
b. Declaration by Independent Directors:
The Company has received and taken on record the declarations received from all the Independent Directors of the Company in accordance to Section 149(6) of the Companies Act, 2013 confirming their independence vis-a-vis the Company.
7. DISCLOSURES RELATED TO BOARD, COMMITTEES AND POLICIES:
a. Board Meetings:
Six meetings of Board of Directors were convened during the financial year under review details of which are furnished in the Corporate Governance report forming part of Annual report.
b. Directorâs Responsibility Statement:
In terms of Section 134(5) of the Companies Act, 2013, in relation to the audited Annual Financial Statements of the Company for the financial year ended March 31, 2018, the Board of Directors hereby confirms that:
a. in the preparation of the annual accounts for the financial year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures;
b. such accounting policies have been selected and applied consistently and the Directors made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018, and of the Loss of the Company for that year;
c. proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. the annual accounts of the Company have been prepared on a going concern basis;
e. internal financial controls have been laid down to be followed by the Company and that such internal financial controls are adequate and were operating effectively;
f. proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
C. Committees:
(I) Audit Committee:
The Audit Committee of Directors was constituted pursuant to the provisions of Section 177 of the Companies Act, 2013 read with Regulation 18 of the Listing Regulations.
The composition of the Audit Committee is in conformity with the provisions of the said section. The Audit Committee comprises of:
1. Mr. A. Arumugham, Chairman, Independent Director
2. Mr. Suresh Vishwasrao, Independent Director
3. Mr. John Mathew, Independent Director
4. Mr. A. R. Mundra, Executive Director- Finance
The scope and terms of reference of the Audit Committee has been amended in accordance with the Act and with Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. During the year under review, the Board of Directors of the Company had accepted all the recommendations of the Committee.
(II) Nomination and Remuneration Committee:
The Nomination and Remuneration Committee of Directors as constituted by the Board of Directors of the Company is in accordance with the requirements of Section 178 of the Companies Act, 2013 and Regulations 19 of the Listing Regulations.
The composition of the Committee is as under:
1. Mr. Naseer Ahmed, Chairman, Independent Director
2. Mr. Suresh Vishwasrao, Independent Director
3. Mr. A. Arumugham, Independent Director
4. Mr. John Mathew, Independent Director
The Board on recommendation of the Nomination and Remuneration Committee has approved the policy setting out the criteria for review of responsibilities of the Directors positive attributes, independence of a Director and policy relating to remuneration for Directors, Key Managerial Personnel and other employees in accordance with the provisions of Section 178 of the Companies Act, 2013.
(III) Stakeholdersâ Relationship Committee:
The Stakeholders Relationship Committee of Directors was constituted pursuant to the provisions of Section 178 of the Companies Act, 2013 and Regulation 20 of the Listing Regulations.
The composition of the committee is as under:
1. Mr. Janardhan Agrawal : Chairman
2. Mr. Prashant Agrawal : Member
3. Mr. A. R. Mundra : Member
Stakeholdersâ Relationship committee was reconstituted by the Board of Directors in its meeting held on 29th May 2018:
1. Mr. Suresh Vishwasrao: Chairman
2. Mr. Prashant Agrawal: Member
3. Mr. A.R. Mundra: Member
4. Ms. Prachi Deshpande: Member
The Company Secretary acts as the Secretary of the Stakeholdersâ Relationship Committee
d. Policies:
(I) Vigil Mechanism Policy:
In compliance with the requirements of section 177 of the companies Act, 2013 & Regulation 22 of Listing Regulations and as measure of good Corporate Governance practice, the Board has formulated a Vigil Mechanism Policy. The policy comprehensively provides an opportunity for any employee/ Director of the Company to raise any issue concerning breaches, accounting policies or any act resulting in financial or reputation loss and misuse of office or suspected or actual fraud. The policy is adequate safeguard against victimization.
The Board of Directors of the Company has, pursuant to the provisions of Section 178(9) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014, framed âVigil Mechanism Policyâ for Directors and Employees of the Company to provide a mechanism which ensures adequate safeguards to employees and Directors from any victimization on raising of concerns of any violations of legal or regulatory requirements, incorrect or misrepresentation of any, financial statements and reports, etc. and the same is also hosted on the website of the Company.
The employees of the Company have the right/option to report their concern/grievance to the Chairman of the Audit Committee.
The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations.
(II) Risk Management Policy:
The Board of Directors of the Company has designed Risk Management Policy and Guidelines to avoid events, situations or circumstances which may lead to negative consequences on the Companyâs businesses, and define a structured approach to manage uncertainty and to make use of these in their decision making pertaining to all business divisions and corporate functions. Key business risks and their mitigation are considered in the annual/strategic business plans and in periodic management reviews. The Board has constituted Risk Management Committee of following Directors
1. Mr. Aman Agrawal: Chairman
2. Mr. Prashant Agrawal: Member
3. Mr. A R Mundra: Member
(III) Corporate Social Responsibility Policy:
As per the provisions of Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Board of Directors has constituted a Corporate Social Responsibility (CSR) Committee as under:
1. Mr. Suresh Vishwasrao - Chairman
2. Mr. A. Arumugham - Member
3. Mr. A. R. Mundra - Member
The Companyâs Corporate Social Responsibility Policy is available on the web-site of the Company i.e. www.bombayrayon.com .
However, the company do not incur any expenditure towards CSR activities during the year under review the Company has incurred losses during three preceding financial years.
e. Annual Evaluation of Directors, Committee and Board:
Independent Directors had done the annual evaluation of the Directors considering the business operations the Company for the financial year 2017-18. The Board of Directors in their meeting has reviewed the contribution made by each Independent Director by way of their timely advice for better corporate governance and compliances under the provisions of the laws as applicable to the Company. No commission is proposed to be paid to the Chairman or any of the Directors of the Company for financial year 2017-18.
f. Details with respect to the Programme for Familiarisation of Independent Directors:*
Independent Directors were made familiar with situation of the company time to time in duly held Board Meetings during the FY 2017-18. The policy of the Company on Familiarisation of Independent Director is put up on the website of the Company i.e. www.bombayrayon.com.
g. Internal Control Systems:
Adequate internal control systems commensurate with the nature of the Companyâs business and size and complexity of its operations are in place and have been operating satisfactorily. Internal control systems comprising of policies and procedures are designed to ensure reliability of financial reporting, timely feedback on achievement of operational and strategic goals, compliance with policies, procedure, applicable laws and regulations and that all assets and resources are acquired economically, used efficiently and adequately protected.
8. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
Pursuant to the Provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the requisite details are annexed herewith vide Annexure II.
The Company has no employee coming under the preview of requirement as mentioned in Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company. In terms of Section 136 (1) of the Companies Act, 2013, the report and the Accounts are being sent to the members. Any member interested in obtaining copy of the same any write to the Company Secretary at the Registered Office of the Company.
9. CHANGE IN CAPITAL:
During the year the company has allotted 131482286 equity shares of Rs.10 each & 4101824 Optionally Convertible Debentures (OCDs) of Rs.1000/ each to the lenders of the Company pursuant to Implementation of Corporate Debt restructuring or Scheme for Sustainable Structuring of Stresses Assets (S4A).
10. AUDITORS AND REPORTS:
a. Statutory Auditors:
The shareholders of the company in the Annual General Meeting held on 26th September, 2017 has appointed PR Agrawal & Awasthi, Chartered Accountants (ICAI Firm Registration Number 117940 W) as the statutory auditors of the Company for the period of 5 years i.e. for the period from FY 2017-18 till FY 2021-22.
The Report of the Statutory Auditors on the financial statement for the year ended 31st March 2018 does not contain any qualification.
b. Secretarial Audit Report for the year ended 31stMarch, 2018
The Board had appointed M/s. Rathi & Associates, Company Secretaries as Secretarial auditors for the financial year 2017-18. The Secretarial Audit Report issued by Rathi & Associates in Form MR-3 forms part of this report and has been marked as Annexure III.
The Report of the Secretarial Auditors on the financial statement for the year ended 31st March 2018 does not contain any qualification
c. Cost Auditors:
Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with Notifications/Circulars issued by the Ministry of Corporate Affairs from time to time, as per the recommendation of the Audit Committee, the Board of Directors at their meeting held on 29 May, 2018, appointed M/s. K. S. Kamalakara & Company, Cost Accountants as the Cost Auditors of the Company for the financial year 2018-19 at an audit fee of Rs. 2,00,000/ subject to approval of the shareholder in ensuing Annual General Meeting.
d. Internal Audit and Control:
M/s. Venkatram & Co., Firm Registration No. 004656S, Chartered Accountants, Internal Auditors of the Company has carried out internal audit and the findings of the Internal Auditors in their reports are discussed regularly in the meetings of the Audit Committee and corrective actions are taken as per the directions of the Audit Committee members.
11. FRAUD REPORTING:
There have been no instances of fraud reported by the Statutory Auditors under Section 143(12) of the Act and Rules framed thereunder either to the Company or to the Central Government.
12. OTHER DISCLOSURES:
Other disclosures as per provisions of Section 134 of the Act read with Companies (Accounts) Rules, 2014 are furnished as under:
a. Extract of Annual Return:
Pursuant to the provisions of Section 134(3)(a) of the Companies Act, 2013, Extract of the Annual Return for the financial year ended 31st March, 2018 made under the provisions of Section 92(3) of the Act is attached as Annexure IV which forms part of this Report.
b. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:
The particulars as required under the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 in respect of conservation of energy, technology absorption, foreign exchange earnings and outgo etc. are furnished in Annexure V which forms part of this Report.
c. Corporate Governance and Management Discussion & Analysis Reports:
The Company is committed to maintain the high standards of Corporate Governance and adheres to its requisites set out by the respective authorities. The report on Corporate Governance as stipulated under the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed vide Annexure VI and forms an integral part of this Annual Report.
On 19th April, 2018, Mr. Janardhan Agrawal, Chairman and Director of the Company has tendered his resignation and further Mr. Aman Agrawal was appointed as the Chairman of the Company. Consequent to that the strength of the Board has reduced to 10 and is now comprised of requisite number of Directors and Independent Directors.
Requisite certificate from the Auditors of the Company M/s. P R Agrawal & Awasthi , Chartered Accountants, (ICAI Firm Registration Number 117940 W), confirming compliance with the conditions of Corporate Governance as stipulated in Chapter IV of Securities Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015 by the Company is attached as Annexure VI (A) and forms an integral part of this Annual Report.
The Company has laid down the Code of Conduct for all Board Members and Senior Management personnel of the Company. The declaration by CEO i.e. Managing Director of the Company related to the compliance of aforesaid Code of Conduct is also attached herewith vide Annexure VI(b) and forms an integral part of this Annual Report.
Certificate issued by Managing Director and Executive Director-Finance of Company with regard to certification on Audited Financial Statement of the Company for financial year 2017-18 is also annexed herewith vide Annexure VI (c) and forms an integral part of this Annual Report.
Management Discussion and Analysis Report for the year under review, as required pursuant to the provisions of Regulation 34 (Schedule V (B) of SEBI (LODR)Regulations,2015) is annexed herewith vide Annexure VII and forms part of this Annual Report.
d. General Disclosures:
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions pertaining to these matters during F.Y. 2017-18:
a. Details relating to acceptance of deposits covered under Chapter V of the Companies Act, 2013.
b. Issue of equity shares with differential rights as to dividend, voting or otherwise.
c. Issue of shares (including sweat equity shares and ESOS) to employees of the Company under any scheme.
d. Instances with respect to voting rights not exercised directly by employees of the Company.
e. There was no revision of the financial statements for the year under review.
Your Directors further state that:
f. Neither the Managing Director nor the Whole-time Directors of the Company have received any remuneration or commission from any of the subsidiary Company.
g. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companyâs operations in future.
h. Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Companyâs financial position have occurred between the end of the financial year of the Company and date of this Annual Report.
i. There was no change in the nature of business of company during F.Y. 2017-18.
j. Pursuant to the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, no case pertaining to sexual harassment at workplace has been reported to company during F.Y. 2017-18.
13. CAUTIONARY STATEMENT:
Statements in the Directorsâ Report and Management Discussion & Analysis describing the companyâs objectives, projections, estimates, expectations or predication may be âforward-looking statementsâ within the meaning of applicable securities laws and regulations, actual results could differ materially for those expressed or implied, important factors that could make difference to the companyâs operations include raw material availability and its prices, cyclical demand and pricing in the companyâs principle markets, changes in government regulations, tax regimes ,economic developments within India and the countries in which the company conducts business and other ancillary factors.
14. ACKNOWLEDGEMENTS AND APPRECIATION:
Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business partners/associates, financial institutions and Central and State Governments for their consistent support and encouragement to the business of Company.
Your Directors records with sincere appreciation the valuable contribution made by employees at all levels and looks forward to their continued commitment to achieve further growth and take up more challenges that the Company has set for the future.
FOR AND ON BEHALF OF THE BOARD OF DIRECTORS
Aman Agrawal
Chairman
(DIN: 00019534)
Place: Mumbai
Date: 29th May, 2018
Registered Office Address:
D 1st Floor, Oberoi Garden Estates,Chandivali Farms,
Chandivali, Andheri (East), Mumbai - 400072
CIN: L17120MH1992PLC066880
TEL No: 91 22 71068800 /61068800 Fax No: 61068830
Mail:[email protected]
Website: www.bombayrayon.com
Mar 31, 2017
Dear Members,
The Directors have pleasure in presenting the Twenty Fourth Annual Report of the Company together with the Audited Annual Accounts for the year ended 31st March, 2017.
1. FINANCIAL AND OPERATIONAL PERFORMANCE:
a. Financial Results
Financial and Operational Results of the Company for the year ended 31st March, 2017 as compared to the previous financial year, is summarized below:
(Rs. in crores)
Particulars |
Standalone For the Financial Year Ended |
|
31-03-2017 |
31-03-2016 |
|
Revenue from Operations |
3876.96 |
4171.62 |
Profit before Interest, Depreciation and Tax |
620.74 |
812.14 |
Less: Interest |
671.75 |
596.65 |
Profit/(Loss) before Depreciation and Tax |
(51.01) |
215.49 |
Less: Depreciation and Amortization |
161.51 |
165.78 |
Profit / (Loss) before Tax |
(212.52) |
49.71 |
Extra-ordinary items |
- |
- |
Tax expenses |
61.29 |
(26.29) |
Minority interest |
- |
- |
Profit / (Loss) after tax |
(151.23) |
23.42 |
b. Operations:
The total sales of the Company for the year under review were lowered by 7.6% to Rs. 3876.96 Crores as against Rs. 4171.62 Crores in previous financial year. The reduction in sale is due to general market conditions and stress on working capital. Due to lowered operations, the Company suffered loss of Rs. 151.23 crores during the financial year under review, compared to Rs.23.42 crores profit as per IND-AS of previous financial year.
c. Report on Performance of Subsidiaries:
A report on the performance and financial position of each of the subsidiaries are provided as Annexure - I and forms part of this report.
BRFL Europe B.V ceased to be a subsidiary of the company as the company is closed down and no other company has become subsidiary of the Company during the year under review.
Additional information on Subsidiary companies:
i. Bombay Rayon Holdings Limited (BRHL)
BRHL holds 100% Equity of foreign subsidiaries BRFL Italia S.r.l., Italy, & BRFL Italia Licensee S.R.L.
BRHL registered a Net loss of Rs. 2.91 crores for the year ended March 31, 2017.
ii. STI India Limited (STI).
The Company is running the unit of STI on job work basis for the manufacturing of yarn and knitted fabric. The part of manufactured yarn is used for captive consumption and the balance is sold.
STI has incurred a net Loss of Rs. 7.98 crores for the year ended March 31, 2017.
iii. DPJ Clothing Ltd, U.K.
DPJ Clothing Limited is engaged in business of wholesale marketing and distribution of clothing products. The said subsidiary is assisting in getting many mid-size retailers of Europe by providing the services either by direct import or by import and delivery basis.
iv. BRFL Italia S.R.L, Italy.
The Company owns the popular âGURUâ brand and is into the business of retailing of ready-made garments as well as other accessories in Europe.
The retail operations, being not viable in the current prevailing economic scenario, are totally closed and the brand âGURUâ is put on license model for various popular products.
v. BRFL Italia Licensee S.R.L
BRHL had subscribed in the equity shares of BRFL Italia licensee S.R.L, a company whom licenses for brand âGURUâ has been transferred.
vi. BRFL Bangladesh Private Limited (BRFL Bangladesh).
The Company has yet to commence its operations.
d. Consolidated Accounts
The Consolidated Financial Statements of your Company for the financial year 2016-17 are prepared in compliance with applicable provisions of the Companies Act, 2013 read with the Rules issued thereunder, applicable Accounting Standards and the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as the âListing Regulationsâ). The consolidated financial statements have been prepared on the basis of audited financial statements of your Company and audited and/or provisional financial statements of its subsidiaries, as approved by the Board of Directors of the said Companies. The Consolidated Financial Statement does not include the financials of BRFL Italia Licensee S.r.l, BRFL Italia S.r.l, DPJ Clothing Limited & BRFL Bangladesh Private Limited as the financials statements of these companies for the respective year ended were not available.
e. Dividend:
Taking into accounts the losses of the Company, your Directors have not recommended any dividend for the financial year ended March 31, 2017.
Pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, top five hundred listed entities based on market capitalization are required to formulate a Dividend Distribution Policy. The Board has approved and adopted the Dividend Distribution Policy and the same is available on the Companyâs Website viz. www.bombayrayon.com
f. Transfer to reserve:
In view of loss incurred during the year under review, the board of directors has not recommended any amount to reserves.
2. DISCLOSURE OF INTERNAL FINANCIAL CONTROLS:
The Internal Financial Controls with reference to financial statements as designed and implemented by the Company are adequate. During the year under review, no material or serious observation has been received from the Internal Auditors of the Company for inefficiency or inadequacy of such controls.
3. PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS AND SECURITIES:
Full Particulars of Loans & Guarantees Given, Investments made and Securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the financial statement (Please refer to Notes 3, 4, 8 and 11 of the Standalone Financial Statement.)
4. PARTICULARS OF CONTRACTS/ ARRANGEMENTS/ TRANSACTIONS WITH RELATED PARTIES:
All contracts / arrangements / transactions, falling within the purview of Section 188 of the Companies Act, 2013, entered into by the Company during the financial year with related parties were in the ordinary course of business and on an armâs length basis. None of the transactions entered into by the Company with related party were material in nature exceeding the limit 10% of annual standalone/consolidated turnover of the Company.
The particulars of contracts or arrangements with related parties are forming part of notes to Accounts in this Annual Report.
All Related party transactions are placed before the Audit Committee and subsequently before the Board for its approval. Omnibus approval is obtained on a yearly basis for transactions which are of repetitive nature as per the policy on Materiality of and Dealing with Related Party Transactions. The policy on related party transactions as approved by the Board of Directors has been uploaded on the website of the Company.
5. PAYMENT TO BANKERS AND STATUTORY AUTHORITIES:
During the year under review, there were delays in payment of dues to bankers as well as to statutory authorities
6. MATTERS RELATED TO CHANGE IN DIRECTORS AND KEY MANAGERIAL PERSONNEL AND DECLARATION BY INDEPENDENT DIRECTORS:
a. Changes in Board of Directors & Key Managerial Personnel:
I. Vacation of Office
During the year, there were no changes in the Directors or Key Managerial Personnel of the Company vacated the office.
II. Directors Retiring by Rotation
Pursuant to the provisions of Section 152 of the Companies Act, 2013, Mr. Janardan Agrawal and Mr. A. R. Mundra, Directors will retire by rotation at the ensuing Annual General Meeting of the Company and being eligible, have offered themselves for re-appointment. In accordance with the provisions of the Act, none of the Independent Directors is liable to retire by rotation.
b. Declaration by Independent Directors:
The Company has received and taken on record the declarations received from all the Independent Directors of the Company in accordance to Section 149(6) of the Companies Act, 2013 confirming their independence vis-a-vis the Company.
The Company is in the process of appointing one more Independent Director for complying with Regulation 17(1) (b) of Listing Regulations. The Nomination and Remuneration Committee of the Company is in the process of identifying a suitable person having requisite professional qualification, knowledge and experience, who fulfills the criteria as specified under Listing regulation as well as Section 149(6) read with Schedule IV of the Companies Act, 2013.
7. DISCLOSURES RELATED TO BOARD, COMMITTEES AND POLICIES:
a. Board Meetings:
Six meetings of Board of Directors were convened during the financial year under review details of which are furnished in the Corporate Governance report forming part of Annual report.
b. Directorâs Responsibility Statement:
In terms of Section 134(5) of the Companies Act, 2013, in relation to the audited Annual Financial Statements of the Company for the financial year ended March 31, 2017, the Board of Directors hereby confirms that:
a. in the preparation of the annual accounts for the financial year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures;
b. such accounting policies have been selected and applied consistently and the Directors made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2017, and of the Loss of the Company for that year;
c. proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. the annual accounts of the Company have been prepared on a going concern basis;
e. internal financial controls have been laid down to be followed by the Company and that such internal financial controls are adequate and were operating effectively;
f. proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
c. Committees:
(I) Audit Committee:
The Audit Committee of Directors was constituted pursuant to the provisions of Section 177 of the Companies Act, 2013 read with Regulation 18 Listing Regulations.
The composition of the Audit Committee is in conformity with the provisions of the said section. The Audit Committee comprises of:
1. Mr. A. Arumugham, Chairman, Independent Director
2. Mr. Suresh Vishwasrao, Independent Director
3. Mr. John Mathew, Independent Director
4. Mr. A. R. Mundra, Executive Director- Finance
The scope and terms of reference of the Audit Committee has been amended in accordance with the Act and with Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. During the year under review, the Board of Directors of the Company had accepted all the recommendations of the Committee.
(II) Nomination and Remuneration Committee:
The Nomination and Remuneration Committee of Directors as constituted by the Board of Directors of the Company is in accordance with the requirements of Section 178 of the Companies Act, 2013 and Regulations 19 of Listing Regulations.
The composition of the Committee is as under:
1. Mr. Naseer Ahmed, Chairman, Independent Director
2. Mr. Suresh Vishwasrao, Independent Director
3. Mr. A. Arumugham, Independent Director
4. Mr. John Mathew, Independent Director
The Board on recommendation of the Nomination and Remuneration Committee has approved the policy setting out the criteria for review of responsibilities of the Directors positive attributes, independence of a Director and policy relating to remuneration for Directors, Key Managerial Personnel and other employees in accordance with the provisions of Section 178 of the Companies Act, 2013.
(III) Stakeholders Relationship Committee:
The Stakeholders Relationship Committee of Directors was constituted pursuant to the provisions of Section 178 of the Companies Act, 2013 and Regulation 20 of Listing Regulations.
The composition of the committee is as under:
1. Mr. Janardan Agrawal, Chairman
2. Mr. Prashant Agrawal, Managing Director
3. Mr. A.R. Mundra, Executive Director- Finance
The Company Secretary acts as the Secretary of the Stakeholdersâ Relationship Committee.
d. Policies:
(I) Vigil Mechanism Policy:
In compliance of the requirements of section 177 of the companies Act, 2013, Regulation 22 of Listing Regulations and as measure of good Corporate Governance practice, the Board has formulated a Vigil Mechanism Policy. The policy comprehensively provides an opportunity for any employee/ Director of the Company to raise any issue concerning breaches, accounting policies or any act resulting in financial or reputation loss and misuse of office or suspected or actual fraud. The policy is adequate safeguard against victimization.
The Board of Directors of the Company has, pursuant to the provisions of Section 178(9) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014, framed âVigil Mechanism Policyâ for Directors and Employees of the Company to provide a mechanism which ensures adequate safeguards to employees and Directors from any victimization on raising of concerns of any violations of legal or regulatory requirements, incorrect or misrepresentation of any, financial statements and reports, etc. and the same is also hosted on the website of the Company.
The employees of the Company have the right/option to report their concern/grievance to the Chairman of the Audit Committee.
The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations.
(II) Risk Management Policy:
The Board of Directors of the Company has designed Risk Management Policy and Guidelines to avoid events, situations or circumstances which may lead to negative consequences on the Companyâs businesses, and define a structured approach to manage uncertainty and to make use of these in their decision making pertaining to all business divisions and corporate functions. Key business risks and their mitigation are considered in the annual/strategic business plans and in periodic management reviews.
(III) Corporate Social Responsibility Policy:
As per the provisions of Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Board of Directors has constituted a Corporate Social Responsibility (CSR) Committee as under:
1. Mr. Suresh Vishwasrao - Independent Director (Chairman)
2. Mr. A. Arumugham- Independent Director
3. Mr. A. R. Mundra - Executive Director
The Companyâs Corporate Social Responsibility Policy is available on the web-site of the Company i.e. www.bombayrayon.com .
As there is net average loss incurred by the Company during the three preceding financial years the Company was not required to spend any amount towards Corporate Social Responsibility activities during the year under review.
e. Annual Evaluation of Directors, Committee and Board:
Independent Directors had reviewed the performance of the Chairman and Executive Directors considering the performance of the Company during the financial year 2016-17. The Board of Directors in their meeting has reviewed the contribution made by each Independent Director by way of their timely advice for better corporate governance and compliances under the provisions of the laws as applicable to the Company. No commission is proposed to be paid to the Chairman or any of the Directors of the Company for financial year 2016-17.
f. Details with respect to the Programme for Familiarisation of Independent Directors:
The last meeting of financial year 2016-17 was held in Tarapur at one of the factory of the Company. The Independent Directors were briefed by the factory head about the business model and other related information to make the directors familiarize with the Company operations. The policy of the Company on Familiarisation of Independent Director is put up on the website of the Company.
g. Internal Control Systems:
Adequate internal control systems commensurate with the nature of the Companyâs business and size and complexity of its operations are in place and have been operating satisfactorily. Internal control systems comprising of policies and procedures are designed to ensure reliability of financial reporting, timely feedback on achievement of operational and strategic goals, compliance with policies, procedure, applicable laws and regulations and that all assets and resources are acquired economically, used efficiently and adequately protected.
8. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
Pursuant to the Provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the requisite details are annexed herewith vide Annexure II and are also available at the Registered Office of Company for inspection during its working hours and any member interested in obtaining such information may directly write to the Company Secretary of Company and the same shall be provided on such request.
The information as required under Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request by any member of the Company. In terms of Section 136 (1) of the Companies Act, 2013, the report and the Accounts are being sent to the members. Any member interested in obtaining copy of the same amy write to the Company Secretary at the Registered Office of the Company.
9. Preferential allotment:
Your company has allotted 5,13,94,193 equity shares of Rs. 10/- each at a premium of Rs. 155.88 to the lenders of the Company on conversion of Funded Interest Term Loan (FITL) and Working Capital Term Loan (WCTL) amounting to Rs. 852,52,68,734/pursuant to approvals received from the shareholders at their Extra-ordinary General Meeting held on May 9, 2016
Further Allotment of shares pursuant preferential issue was made to following lenders:-
1 On 3rd November 2016 to Union Bank of India for 2,991,921 equity Shares
2. On 5th May, 2017 Standard Chartered Bank 14,79,985 equity shares
During the year ICICI Bank Limited has vide itâs letter dated 6th October, 2016 informed the company about assignment of itâs loan to JM Financial Asset Reconstruction Company Limited. Pursuant to the provisions of the Companies Act, 2013, the resolution passed under section 62 (1) (c ) of the Act is valid for the period of 12 months from the date of approval sought from the Shareholders. Accordingly the approval obtained in the Extra - Ordinary General Meeting held on 9th May, 2016 was to expire on 8th May, 2017. Hence, the company had approached the shareholders for allotment of equity shares to -
Name of the |
Debt Amount |
No of Equity |
Lender |
Shares |
|
(in Rs) |
||
Bank of India |
424,099,922 |
2,556,667 |
JM Financial |
131,099,940 |
790,330 |
Asset |
||
Reconstruction |
||
Company Ltd. |
||
Total |
555,199,862 |
33,46,997 |
Accordingly, the shares has been allotted to aforesaid lenders on receipt of approval from the shareholders in the Extra - Ordinary General Meeting held on 20th May, 2017.
- âS4Aâ SCHEME Implementation/Increase in Share Capital
Since the liquidity stress on the Company was increased during the year under review, the Lenders in their Joint Lenderâs Forum (âJLFâ) Meeting held on October 7, 2016 deliberated on the various options and agreed to consider the S4A Scheme for the Company. The Lenders had decided to consider the S4A Scheme with the Reference Date as November 25, 2016. The Lenders at their JLF held on November 25, 2016, January 9, 2017 and January 16, 2017 have deliberated and agreed to convert part of their debt exposure which is considered as unsustainable into Equity shares and Optionally Convertible Debentures (OCDs) pursuant to implementation of the S4A Scheme in accordance with and as specified in the financing documents entered/to be entered by the Company with, inter alia, the Lenders for the purpose of implementation of the S4A Scheme (hereinafter referred to as the âS4A Agreements/ S4A Documentsâ).
Accordingly approvals from the shareholders had been sought at the Extra General Meeting held on 20 May 2017, for increase in the authorized capital of the company from Rs. 200,00,00,000/- (Rupees Two Hundred Crores only) consists of 20,00,00,000 (Twenty Crores) equity shares of Rs. 10/- each to Rs. 365,00,00,000/-(Rupees Three Hundred Sixty Five Crores only) consists of 36,50,00,000 (Thirty Six crores Fifty Lakhs) equity shares of Rs. 10/- each and for issue of equity shares and Optionally Convertible Debentures to the Lenders. The allotment committee of the Board of Directors at its meeting held on May 24, 2017 allotted collectively to the lenders 107,345,243 Equity Shares of face value of Rs 10/- at a premium of Rs 136.03 /- per share aggregating Rs 15,67,56,25,835/- and 39,95,092 OCDs of face value Rs 1000/- each at par (carrying coupon rate 0.01% p.a ) aggregating to Rs 3,99,50,92,000/- on preferential basis as a part of the S4A Scheme as under :-
S no. |
Name of the Lenders |
No. of Equity |
No. of OCDs |
Shares |
|||
1. |
State Bank of India |
43,740,000 |
2,880,352 |
2. |
Axis Bank |
13,933,525 |
245,705 |
3. |
Exim Bank |
5,695,234 |
100,430 |
4. |
Punjab National Bank |
5,802,566 |
102,323 |
5. |
Allahabad Bank |
3,962,657 |
69,878 |
6. |
Bank of India |
4,476,163 |
78,933 |
7. |
Karur Vysya Bank |
1,793,453 |
31,626 |
8. |
IDBI |
832,576 |
14,682 |
9. |
Corporation Bank |
481,799 |
8,496 |
10. |
Bank of Maharashtra |
493,709 |
8,706 |
11. |
Dena Bank |
2,292,981 |
33,556 |
12. |
Oriental Bank of Commerce |
610,857 |
10,772 |
13. |
Karnataka Bank |
527,337 |
9,299 |
14. |
Indian Bank |
1,232,863 |
21,740 |
15. |
JM Financial Asset Reconstruction Company Ltd |
2,228,659 |
39,300 |
16. |
Indian Overseas Bank |
1,300,035 |
22,925 |
17. |
Union Bank of India |
7,636,693 |
134,666 |
18. |
Central Bank of India |
3,645,233 |
64,280 |
19. |
Standard Chartered Bank |
6,658,903 |
117,423 |
Total |
107,345,243 |
3,995,092 |
10. AUDITORS AND REPORTS:
a. Statutory Auditors:
Pursuant to the provisions of Section 139 of the Companies Act, 2013, and Rules made thereunder the term of office of V.K. Beswal & Associates, Chartered Accountants, Mumbai (Firm Registration Number: 101083W) of the Company will conclude from the close of ensuing Annual General Meeting of the Company. The Board of Directors places on record its appreciation to the services rendered by V. K. Beswal & Associates, Chartered Accountants as the Statutory Auditors of the Company.
Subject to the approval of the Members and pursuant to Section 139 of the Companies Act, 2013, the Board of Directors of the Company has recommended the appointment of PR Agrawal & Awasthi Chartered Accountants (ICAI Firm Registration Number 117940 W) as the Statutory Auditors of the Company. Accordingly, the Board recommends the resolution in relation to appointment of Statutory Auditors, for the approval by the shareholders of the Company.
The Report of the Auditors on the financial statement for the year ended 31st March 2017 does not contain any qualification.
b. Secretarial Audit Report for the year ended 31stMarch, 2017
The Board had appointed M/s. Rathi & Associates, Company Secretaries as Secretarial auditors for the financial year 2016-17. Secretarial Audit Report issued by Rathi & Associates in form MR-3 for the FY 2016-17 forms part of this report and marked as Annexure III.
The comments on the specific observations made in the above Secretarial Audit Report as under:-
1. The meeting of Board of Directors for approving unaudited financial result for the quarter ended 31st December, 2016 was scheduled to be held on 14th February 2017 but same was postponed and then was held on 6th March 2017. The Company had paid the penalty as levied by the Stock Exchanges.
2. There were some reconciliation problems related to unpaid dividend for financial year 08-09 amounting to Rs.200657.50 resulting into non-transfer of the same to Investor Education Protection Fund in time.
3 The Company is in the process of appointing one more Independent Director for complying with Regulation 17(1) of listing regulation.
c. Cost Auditors:
Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with Notifications / Circulars issued by the Ministry of Corporate Affairs from time to time, as per the recommendation of the Audit Committee, the Board of Directors at their meeting held on 30th May, 2017, appointed M/s. K. S. Kamalakara & Company, Cost Accountants as the Cost Auditors of the Company for the financial year 2017-18 at annual audit fee of Rs. 5,00,000/ subject to approval of the shareholder in ensuing Annual General Meeting.
d. Internal Audit and Control:
M/s. Venkatram & Co., Firm Registration No. 004656S, Chartered Accountants, Internal Auditors of the Company has carried out internal audit and the findings of the Internal Auditors in their reports are discussed regularly in the meetings of the Audit Committee and corrective actions are taken as per the directions of the Audit Committee members.
11. FRAUD REPORTING:
There have been no instances of fraud reported by the Statutory Auditors under Section 143(12) of the Act and Rules framed thereunder either to the Company or to the Central Government.
12. OTHER DISCLOSURES:
Other disclosures as per provisions of Section 134 of the Act read with Companies (Accounts) Rules, 2014 are furnished as under:
a. Extract of Annual Return:
Pursuant to the provisions of Section 134(3)(a) of the Companies Act, 2013, Extract of the Annual Return for the financial year ended 31st March, 2017 made under the provisions of Section 92(3) of the Act is attached as Annexure IV which forms part of this Report.
b. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:
The particulars as required under the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 in respect of conservation of energy, technology absorption, foreign exchange earnings and outgo etc. are furnished in Annexure V which forms part of this Report.
c. Corporate Governance and Management Discussion & Analysis Reports:
The Company is committed to maintain the high standards of Corporate Governance and adheres to its requisites set out by the respective authorities. The report on Corporate Governance as stipulated under the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed vide Annexure VI and forms an integral part of this Annual Report.
Requisite certificate from the Auditors of the Company V. K. Beswal & Associates, Chartered Accountants, (Firm Registration Number: 101083W), confirming compliance with the conditions of Corporate Governance as stipulated in Chapter IV of Securities Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015) by the Company is attached as Annexure VI (A) and forms an integral part of this Annual Report.
Certificate issued by Managing Director and Executive Director of Company with regard to certification on Audited Financial Statement of the Company for financial year 2016-17 is also annexed herewith vide Annexure VI (B) and forms an integral part of this Annual Report.
The Company has laid down the Code of Conduct for all Board Members and Senior Management personnel of the Company. The declaration by CEO i.e. Managing Director of the Company related to the compliance of aforesaid Code of Conduct is also attached herewith vide Annexure VI(C) and forms an integral part of this Annual Report.
Management Discussion and Analysis Report for the year under review, as required pursuant to the provisions of Regulation 34 (Schedule V (B) of SEBI (L0DR)Regulations,2015) is annexed herewith vide Annexure VII and forms part of this Annual Report.
d. General Disclosures:
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions pertaining to these matters during F.Y. 2016-17:
a. Details relating to acceptance of deposits covered under Chapter V of the Companies Act, 2013.
b. Issue of equity shares with differential rights as to dividend, voting or otherwise.
c. Issue of shares (including sweat equity shares and ESOS) to employees of the Company under any scheme.
d. Instances with respect to voting rights not exercised directly by employees of the Company.
e. There was no revision of the financial statements for the year under review.
Your Directors further state that:
f. Neither the Managing Director nor the Whole-time Directors of the Company have received any remuneration or commission from any of the subsidiary Company.
g. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companyâs operations in future.
h. Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Companyâs financial position, have occurred between the end of the financial year of the Company and date of this Annual Report.
i. There was no change in the nature of business of company during F.Y. 2016-17.
j. Pursuant to the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, no case pertaining to sexual harassment at workplace has been reported to company during F.Y. 2016-17.
13. CAUTIONARY STATEMENT:
Statements in the directorsâ and management discussion and analysis describing the companyâs objectives, projections, estimates, expectations or predication may be âforward-looking statementsâ within the meaning of applicable securities laws and regulations, actual results could differ materially for those expressed or implied, important factors that could make difference to the companyâs operations include raw material availability and its prices, cyclical demand and pricing in the companyâs principle markets, changes in government regulations, tax regimes ,economic developments within India and the countries in which the company conducts business and other ancillary factors.
14. ACKNOWLEDGEMENTS AND APPRECIATION:
Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business partners/associates, financial institutions and Central and State Governments for their consistent support and encouragement to the Company.
Your Directors records with sincere appreciation the valuable contribution made by employees at all levels and looks forward to their continued commitment to achieve further growth and take up more challenges that the Company has set for the future.
For and on behalf of the Board of Directors
Janardan Agrawal
Chairman
DIN: 00019497
Place: Mumbai
Date: August 11, 2017
Registered Office Address:
D 1st Floor, Oberoi Garden Estates, Chandivali Farms,
Chandivali, Andheri (East), Mumbai - 400072
CIN: L17120MH1992PLC066880
TEL No: 91 22 71068800 /61068800 Fax No: 61068830
Mail:[email protected]
Website: www.bombayrayon.com
Mar 31, 2016
Dear Members,
The Directors have pleasure in presenting the Twenty Third Annual Report of the Company together with the Audited Annual Accounts for the year ended 31st March, 2016.
1. FINANCIAL AND OPERATIONAL PERFORMANCE:
a. Financial Results
Financial and Operational Results of the Company for the year ended 31st March, 2016 as compared to the previous financial year, is summarized below:
(Rs. in crores)
Particulars |
31-03-16 |
31-03-15 |
Revenue from Operations |
4171.62 |
3532.67 |
Profit before Interest, Depreciation & Amortization and Tax |
812.14 |
602.88 |
Less: Interest |
596.65 |
557.60 |
Profit before Depreciation & Amortization and Tax Less: Depreciation & |
215.49 |
45.28 |
Amortization |
161.23 |
166.33 |
Profit / (Loss) before Tax |
54.26 |
(121.05) |
Current Tax |
(12.22) |
_ |
Deferred Tax |
(4.93) |
42.31 |
MAT Credit Entitlement |
11.74 |
_ |
Profit / (Loss) after tax |
48.85 |
(78.74) |
b. Operations:
The total sales of the Company for the year under review were amounted to Rs. 4172.08 Crores as against Rs. 3532.67 crores of previous financial year, registering a growth of 18%. The exports sales have increased to Rs. 661.43 Crores in comparison to Rs. 395.55 Crores in 2014-15, the domestic sales was higher by 11.89% from Rs. 3137.49 Crores to Rs. 3510.65 Crores. The Company has earned a profit of Rs. 48.85 Crores for the year 2015-16 in comparison to the loss incurred of Rs. 78.74 Crores for the year 2014-15.
c. Report on Performance of Subsidiaries:
A report on the performance and financial position of each of the subsidiaries for the year ended 31st March 2016 is provided as Annexure - I and forms part of this report.
None of the Company''s Subsidiaries ceased to be a subsidiary and no other company has become subsidiary of the Company during the year under review.
Additional information on Subsidiary companies:
(i) Bombay Rayon Holdings Limited (BRHL)
BRHL holds 100% Equity of foreign subsidiaries BRFL Europe B.V., Netherlands & BRFL Italia S.r.l., Italy,BRFL Italia Licensee S.R.L
BRHL has registered a Net Profit of Rs. 2.31 crores for the year ended March 31, 2016
(ii) DPJ Clothing Ltd, U.K.
DPJ Clothing Limited is engaged in business of wholesale marketing and distribution of clothing products. The said subsidiary is assisting in getting many mid-size retailers of Europe by providing the services either by direct import or by import and delivery basis.
DPJ Clothing Ltd has registered loss of Rs. 0.51 crores for the year ended March 31, 2016.
(iii) BRFL Europe B.V., Netherlands.
BRFL Europe B.V. at Netherlands curtailed its operations to save costs and most of the larger customers are directly dealt from well-established service facilities from India offices.
BRFL Europe B.V. has registered a loss of Rs.5.10 crores for the year ended March 31, 2016.
(iv) BRFL Italia S.R.L, Italy.
The Company owns the popular ''GURU'' brand and is into the business of retailing of ready-made garments as well as other accessories in Europe.
The retail operations being not viable in the current prevailing economic scenario, are totally closed and the brand ''GURU'' is put on license model for various popular products.
BRFL Italia S.r.l, Italy has registered a net loss of Rs. 10.50 crores for the year ended December 31, 2015.
(v) BRFL Italia Licensee S.R.L
During the year under review, the BRFL Italia Licensee
S.R.L. has registered loss of Rs. 5.20 crore as on December 31, 2015. BRHL had subscribed in the equity shares of BRFL Italia licensee S.R.L, a company whom licence for brand ''GURU'' has been transferred.
(vi) STI India Limited (STI).
The Company is running the unit of STI on job work basis for the manufacturing of yarn and knitted fabric. The part of manufactured yarn is used for captive consumption and balance is sold.
STI has incurred a net Profit of Rs. 24.00 crores for the year ended March 31, 2016.
(vii) BRFL Bangladesh Private Limited (BRFL Bangladesh).
The Company has not taken up any operations yet.
d. Consolidated Accounts
The Consolidated Financial Statements of your Company for the financial year 2015-16 are prepared in compliance with applicable provisions of the Companies Act, 2013 read with the Rules issued thereunder, applicable Accounting Standards and the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as the "Listing Regulations"). The consolidated financial statements have been prepared on the basis of audited/provisional financial statements of your Company, its subsidiaries and, as approved by the respective Board of Directors.
e. Dividend:
Considering the requirement for working capital after the operations of the Company, it was decided to retain the profit earned in the Company for the financial year ended March 31, 2016.
f. Transfer to reserves:
The Board of Directors has not recommended transfer of any amount of profit to reserves during the year under review. Hence, the entire amount of profit for the year under review has been carried forward to the statement of profit and loss.
2. DISCLOSURE OF INTERNAL FINANCIAL CONTROLS:
The Internal Financial Controls with reference to financial statements as designed and implemented by the Company are adequate. During the year under review, no material or serious observation has been received from the Internal Auditors of the Company for inefficiency or inadequacy of such controls.
3. PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS AND SECURITIES:
Full Particulars of Loans & Guarantees Given, Investments made and Securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the financial statement (Please refer to Note 11,12,13,17 of the Financial Statement.)
4. PARTICULAR OF CONTRACTS/ ARRANGEMENTS/ TRANSACTIONS WITH RELATED PARTIES:
All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm''s length basis. None of the transactions entered in to by the Company with related party were material in nature exceeding the limit 10% of annual standalone/consolidated turnover of the Company.
The particulars of contracts or arrangements with related parties are forming part of notes to Accounts in this Annual Report.
All Related party transactions are placed before the Audit Committee and subsequently before the Board for its approval. Omnibus approval is obtained on a yearly basis for transactions which are of repetitive nature as per the policy on Materiality of and Dealing with Related Party Transactions. The policy on related party transactions as approved by the Board of Directors has been uploaded on the website of the Company.
5. PAYMENT TO BANKERS AND STATUTORY AUTHORITIES:
During the year under review, there were delays in payment of dues to bankers as well as to statutory authorities
6. MATTERS RELATED TO CHANGE IN DIRECTORS AND KEY MANAGERIAL PERSONNEL AND DECLARATION BY INDEPENDENT DIRECTORS:
a. Changes in Board of Directors & Key Managerial Personnel:
I. Vacation of Office
During the year, none of the Directors or Key Managerial Personnel of the Company vacated the office.
II. Appointments
During the year, Mr. Narayanan Raja was appointed as a Nominee Director on the Board of the Company with effect from 15thFebruary, 2016 as per the recommendation of State Bank of India.
III. Directors Retiring by Rotation
Pursuant to the provisions of Section 152 of the Companies Act, 2013, Mr. Aman Agrawal and Mr. Prashant Agrawal will retire by rotation at the ensuing Annual General Meeting of the Company and being eligible, have offered themselves for re-appointment. In accordance with the provisions of the Act, none of the Independent Directors is liable to retire by rotation.
IV. Re-appointment of Directors
Pursuant to the provision of section 196 197,198 and 203 of the Companies Act, 2013. The term of appointment of whole time Directors. viz Mr. Aman Agrawal as Vice chairman, Mr. Prashant Agrawal as the Managing Director, Mr. A. R. Mundra Executive Director- Finance , Ms. Prachi Deshpande Director-Secretarial & Corporate Affairs expired on 31st May, 2016. The Board recommends for their re-appointment for further tenure of three years commencing from 1st June, 2016.
b. Declaration by Independent Directors:
The Company has received and taken on record the declarations received from all the Independent Directors of the Company in accordance to Section 149(6) of the Companies Act, 2013 confirming their independence vis-a-vis the Company.
The Company is in the process of appointing one more Independent Director for complying with Regulation 17(1) of listing regulation. The Nomination and Remuneration Committee of the Company is in the process of identifying a suitable person having requisite professional qualification, knowledge and experience, who fulfills the criteria as specified under Listing obligation and Disclosure Requriements regulation 2015 as well as section 149(6) read with Schedule IV of the Companies Act, 2013.
7. DISCLOSURES RELATED TO BOARD,COMMITTEES AND POLICIES:
a. Board Meetings:
Six meetings of Board of Directors were convened during the financial year under review i.e. on 22nd May, 2015, 14th August, 2015, 29th September,2015, 10th November,2015, 15th February,2016 and 30th March, 2016
b. Director''s Responsibility Statement:
In terms of Section 134(5) of the Companies Act, 2013, in relation to the audited Annual Financial Statements of the Company for the year ended 31st March, 2016, the Board of Directors hereby confirms that:
a. in the preparation of the annual accounts for the year ended 31stMarch 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures;
b. such accounting policies have been selected and applied consistently and the Directors made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2016, and of the Profit of the Company for that year;
c. proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. the annual accounts of the Company have been prepared on a going concern basis;
e. internal financial controls have been laid down to be followed by the Company and that such internal financial controls are adequate and were operating effectively;
f. proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
c. Committees:
(I) Audit Committee:
The Audit Committee of Directors was constituted pursuant to the provisions of Section 177 of the Companies Act, 2013 read with Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The composition of the Audit Committee is in conformity with the provisions of the said section. The Audit Committee comprises of:
1. Mr. A. Arumugham, Chairman, Independent Director
2. Mr. Suresh Vishwasrao, Independent Director
3. Mr. A. R. Mundra, Executive Director- Finance
4. Mr. John Mathew, Independent Director
The scope and terms of reference of the Audit Committee have been amended in accordance with the Act and with Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. During the year under review, the Board of Directors of the Company had accepted all the recommendations of the Committee.
(II) Nomination and Remuneration Committee:
The Nomination and Remuneration Committee of Directors as constituted by the Board of Directors of the Company is in accordance with the requirements of Section 178 of the Act.
The composition of the committee is as under:
1. Mr. Naseer Ahmed,Chairman, Independent Director
2. Mr. Suresh Vishwasrao, Independent Director
3. Mr. A. Arumugham, Independent Director
4. Mr. John Mathew, Independent Director
The Board, on recommendation of the Nomination and Remuneration Committee, has approved a policy setting out the criteria for review of responsibilities of the Directors positive attributes, independence of a Director and policy relating to remuneration for Directors, Key Managerial Personnel and other employees in accordance with the provisions of Section 178 of the Act.
(III) Stakeholders Relationship Committee:
The Stakeholder Relationship Committee of Directors was constituted pursuant to the provisions of Section 178 of the Companies Act, 2013.
The composition of the committee is as under:
1. Mr. Janardhan Agrawal, Chairman
2. Mr. Prashant Agrawal, Managing Director
3. Mr. A.R. Mundra, Executive Director- Finance
The Company Secretary acts as the Secretary of the Stakeholders'' Relationship Committee.
d. Policies:
(I) Vigil Mechanism Policy:
In compliance of the requirements of section 177 of the companies Act, 2013, Securities Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015 and as measure of good Corporate Governance practice, the Board has formulated a Vigil Mechanism Policy. The policy comprehensively provides an opportunity for any employee/ Director of the Company to raise any issue concerning breaches, accounting policies or any act resulting in financial or reputation loss and misuse of office or suspected or actual fraud. The policy is a adequate safeguard against victimization.
The Board of Directors of the Company has, pursuant to the provisions of Section 178(9) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014, framed "Vigil Mechanism Policy" for Directors and Employees of the Company to provide a mechanism which ensures adequate safeguards to employees and Directors from any victimization on raising of concerns of any violations of legal or regulatory requirements, incorrect or misrepresentation of any, financial statements and reports, etc. and the same is also hosted on the website of the Company.
The employees of the Company have the right/option to report their concern/grievance to the Chairman of the Audit Committee.
The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations.
(II) Risk Management Policy:
The Board of Directors of the Company has designed Risk Management Policy and Guidelines to avoid events, situations or circumstances which may lead to negative consequences on the Company''s businesses, and define a structured approach to manage uncertainty and to make use of these in their decision making pertaining to all business divisions and corporate functions. Key business risks and their mitigation are considered in the annual/ strategic business plans and in periodic management reviews.
(III) Corporate Social Responsibility Policy:
As per the provisions of Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Board of Directors has constituted a Corporate Social Responsibility (CSR) Committee as under:
1. Mr. Suresh Vishwasrao - Independent Director (Chairman)
2. Mr. A. Arumugham- Independent Director
3. Mr. A. R. Mundra - Executive Director
The Company has drafted the Corporate Social Responsibility Policy which may be accessed on the website of the Company i.e. www.bombayrayon.com.
As there is net average loss incurred by the Company during the three preceding financial years the company has not spent any amount towards Corporate Social Responsibility activities.
(IV) POLICES AS PER SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015
As per requirements of provisions of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 the Company has adopted the following policies:
- Policy for Preservation of Documents. (Regulation 9)
- Policy for determination and Disclosure of material Events. (Regulation 30 (4) (ii))
- Archival Policy, ( Regulation 30 (8)
- Policy on Material Related Party Transactions. (Regulation 23)
e. Annual Evaluation of Directors, Committee and Board:
Independent Directors had reviewed the performance of the Chairman and Executive Directors considering the performance of the Company during the financial year 2015-16. The Board of Directors in their meeting has reviewed the contribution made by each Independent Director by way of their timely advice for better corporate governance and compliances under the provisions of the laws as applicable to the Company. There is no change in the remuneration payable to the Directors for next financial year 2016-17. No commission is proposed to be paid to the Chairman or any of the Directors of the Company for financial year 2015-16.
f. Details with respect to the Programme for Familiarization of Independent Directors:
The details of programme for familiarization of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company. (i.e.www.bombayrayon.com)
g. Internal Control Systems:
Adequate internal control systems commensurate with the nature of the Company''s business and size and complexity of its operations are in place has been operating satisfactorily. Internal control systems comprising of policies and procedures are designed to ensure reliability of financial reporting, timely feedback on achievement of operational and strategic goals, compliance with policies, procedure, applicable laws and regulations and that all assets and resources are acquired economically, used efficiently and adequately protected.
8. Particulars of Employees and Related Disclosures:
Pursuant to the Provisions of section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the requisite details are annexed herewith vide Annexure II and are also available at the Registered Office of Company for inspection during its working hours and any member interested in obtaining such information may directly write to the Company Secretary of Company and the same shall be provided on such request.
9. Preferential allotment:
The shareholders of the Company at their Extra-ordinary General Meeting held on May 9, 2016 have approved the issue and allotment of 5,44,70,553 fully paid-up equity shares of the Company having face value of Rs. 10/- each, at a price of Rs. 165.88 per share, pursuant to the decision of CDR EG vide their letter dated 3rd February, 2016, to the Lenders of the Company, by converting the Funded Interest Term Loan (FITL) and Working Capital Term Loan (WCTL) aggregating to Rs. 9,035,576,868 in accordance with the Section 62(1)(c) and other applicable provisions of the Companies Act, 2013 and rules made there under and provisions of Chapter VII- "Preferential issue" of the SEBI (Issue of Capital and Disclosure Requirements) Regulation, 2009
Allotments of shares pursuant to above referred Preferential issue were made in following three tranches:
1. June 15, 2016 for allotment of 4,66,77,611 equity shares;
2. June 16, 2016 for allotment of 5,60,042 equity shares;
3. June 27, 2016 for allotment of 11,64,618 equity shares.
Post allotment the public shareholding of the Company has now been increased to 32.30% of the total paid-up share capital, in compliance with the Regulation 38 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which prescribes minimum public shareholding.
10. AUDITORS AND REPORTS:
a. Statutory Auditors:
The observations made by the Statutory Auditors in their Report read with the relevant notes as given in the Notes to Accounts for the year ended March 31, 2016, are self-explanatory and therefore do not call for any further comments under Section 134(3) of the Companies Act, 2013. The Auditors'' Report does not contain any qualification, reservation and adverse remark.
Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, M/s. V. K. Beswal & Associates, Chartered Accountants, Mumbai (Firm Registration Number: 101083W),the Statutory Auditors of the Company, hold office upto the conclusion of the ensuing Annual General Meeting. The consent of the Auditors along with certificate under Section 139 of the Act have been obtained from the Auditors to the effect that their appointment, if made, shall be in accordance with the prescribed conditions and that they are eligible to hold the office of Auditors of the Company. The Board recommends the appointment of M/s.
V.K. Beswal & Associates, Chartered Accountants, Mumbai (Firm Registration Number: 101083W), as the Statutory Auditors of the Company for the financial year 2016-17.
Necessary resolution for re-appointment of the said Auditors is included in the Notice of Annual General Meeting for seeking approval of members.
b. Secretarial Audit Report for the year ended 31stMarch, 2016:
The Board had appointed Rathi & Associates, Company Secretaries as Secretarial auditors for the financial year 201516. Secretarial Audit Report issued by Rathi & Associates in form MR-3 for the FY 2015-16 forms part of this report and marked as Annexure III.
With reference to observation about:-
(i) As regards the remuneration paid to Vice Chairman and Managing Director, the company is in the process of filing of an application with Central Government for waiver of recovery of excess remuneration.
(ii) As a result of allotment of 48,402,271 equity shares pursuant to the provisions of Chapter VII of ICDR 2009, in the month of June 2016 the public share has increased to 32.3% by which compliance with require to minimum public shareholding has been fulfilled.
(iii) The Company is in the process of appointing one more Independent Director for complying with Regulation 17(1) of listing regulation.
c. Cost Auditors:
Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with Notifications/Circulars issued by the Ministry of Corporate Affairs from time to time, as per the recommendation of the Audit Committee, the Board of Directors at their meeting held on 5thAugust, 2016, appointed M/s. K. S. Kamalakara & Company, Cost Accountants as the Cost Auditors of the Company for the financial year 2016-17 at annual audit fee of Rs. 5,00,000/-. Subject to approval of the shareholder in ensuing Annual General Meeting.
d. Internal Audit and Control:
M/s Venkatram & Co., Firm Registration No. 004656S, Chartered Accountants, Internal Auditors of the Company has carried out internal audit and the findings of the Internal Auditors in their reports are discussed regularly in the meetings of the Audit Committee and corrective actions are taken as per the directions of the Audit Committee members.
11. OTHER DISCLOSURES:
Other disclosures as per provisions of Section 134 of the Act read with Companies (Accounts) Rules, 2014 are furnished as under:
a. Extract of Annual Return:
Pursuant to the provisions of Section 134(3)(a) of the Companies Act, 2013, Extract of the Annual Return for the financial year ended 31st March, 2016 made under the provisions of Section 92(3) of the Act is attached as Annexure IV which forms part of this Report.
b. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:
The particulars as required under the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 in respect of conservation of energy, technology absorption, foreign exchange earnings and outgo etc. are furnished in Annexure V which forms part of this Report.
c. Corporate Governance and Management Discussion & Analysis Reports:
The Company is committed to maintain the high standards of Corporate Governance and adheres to its requisites set out by the respective authorities. The report on Corporate Governance as stipulated under the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. is annexed vide Annexure VI and forms an integral part of this Annual Report.
Requisite certificate from the Auditors of the Company M/s V. K. Beswal & Associates, Chartered Accountants,(Firm Registration Number: 101083W), confirming compliance with the conditions of Corporate Governance as stipulated in Chapter IV of Securities Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations,2015) the said company with stock exchanges, Annexure VI(A) and forms an integral part of this Annual Report.
Certificate issued by Managing Director and Executive Director of Company with regard to certification on Audited Financial Statement of the Company for financial year 2015-16 is also annexed herewith vide Annexure VI (B) and forms an integral part of this Annual Report.
The Company has suitably laid down the Code of Conduct for all Board Members and Senior Management personnel of the Company. The declaration by CEO i.e. Managing Director of company related to the compliance of aforesaid Code of Conduct is also attached herewith vide Annexure VI(C) and forms an integral part of this Annual Report.
Management Discussion and Analysis Report for the year under review, as required pursuant to the provisions of Regulation 34 (Schedule V (B) of SEBI (Listing obligation and disclosure requirements) Regulations,2015 is annexed herewith vide Annexure VII and forms part of this Annual Report.
d. General Disclosures:
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions pertaining to these matters during F.Y. 2015-16:
a. Details relating to acceptance of deposits covered under Chapter V of the Companies Act, 2013.
b. Issue of equity shares with differential rights as to dividend, voting or otherwise.
c. Issue of shares (including sweat equity shares and ESOS) to employees of the Company under any scheme.
d. Instances with respect to voting rights not exercised directly by employees of the Company.
e. There was no revision of the financial statements for the year under review.
Your Directors further state that:
f. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of the subsidiary Company.
g. 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.
h. Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Company''s financial position, have occurred between the end of the financial year of the Company and date of this Annual Report.
i. There was no change in the nature of business of company during F.Y. 2015-16.
j. Pursuant to the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, no case pertaining to sexual harassment at workplace has been reported to company during F.Y. 2015-16.
12. CAUTIONARY STATEMENT:
Statements in the directors'' and management discussion and analysis describing the company''s objectives, projections, estimates, expectations or predication may be "forward-looking statements'' within the meaning of applicable securities laws and regulations, actual results could differ materially for those expressed or implied, important factors that could make difference to the company''s operations include raw material availability and its prices, cyclical demand and pricing in the company''s principle markets, changes in government regulations, tax regimes ,economic developments within India and the countries in which the company conducts business and other ancillary factors.
13. ACKNOWLEDGEMENTS AND APPRECIATION:
Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business partners/associates, financial institutions and Central and State Governments for their consistent support and encouragement to the Company.
Your Directors records with sincere appreciation the valuable contribution made by employees at all levels and looks forward to their continued commitment to achieve further growth and take up more challenges that the Company has set for the future.
For and on behalf of the Board of Directors
Janardhan Agrawal
Chairman
DIN: 00019497
Place: Mumbai
Date: 5th August, 2016
Registered Office Address:
D 1stFloor, Oberoi Garden Estates, Chandivali Farms,
Chandivali, Andheri (East), Mumbai - 400072
CIN:L17120MH1992PLC066880
TEL No: 91 22 39858800/51068800
Fax No : 39858700
Mail:[email protected]
Website: www.bombayrayon.com
Mar 31, 2015
Dear Members,
The Directors have pleasure in presenting the Twenty Second Annual
Report of the Company together with the Audited Annual Accounts for the
year ended 31st March, 2015.
1. FINANCIAL AND OPERATIONAL PERFORMANCE:
a. Financial Results
Financial and Operational Results of the Company for the year ended
31st March, 2015 as compared to the previous financial year, is
summarized below:
(Rs. in crores)
Particulars 31-03-15 31-03-14
Revenue from Operations 3532.67 2907.36
Profit before Interest, 602.88 451.65
Depreciation and Tax
Less: Interest 557.60 450.19
Profit before Depreciation 45.28 1.46
and Tax
Less: Depreciation 166.33 275.76
Profit / (Loss) before (121.05) (274.30)
Extraordinary Items and Tax
Exceptional Items - Prior - 3.80
Period items (net)
Extra Ordinary Items
- Stock valuation difference - (258.36)
written off
- Foreign Exchange Rate - (90.92)
fluctuation Loss
Less: Provision for taxes 42.31 209.91
(Deferred Tax)
Profit / (Loss) after tax (78.74) (409.87)
b. Operations:
The total sales of the Company for the year increased to Rs. 3533.04
Crores. Though the exports have declined to Rs. 395.55 Crores in
comparison to Rs. 473.20 Crores in 2013-14, the domestic sales was
higher by 31.21% from Rs. 2285.87 Crores to Rs. 2999.32 Crores. The net
loss for the year has come down to Rs. 78.74 Crores for the year in
comparison to Rs. 409.87 Crores for the year 2013-14.
c. Report on Performance of Subsidiaries:
A report on the performance and financial position of each of the
subsidiaries for the year ended 31st March 2015 is provided as Annexure
- I and forms part of this report.
None of the Company's Subsidiaries ceased to be a subsidiary during the
year under report.
Additional information on Subsidiary companies:
(i) Bombay Rayon Holdings Limited (BRHL).
BRHL holds 100% Equity of foreign subsidiaries BRFL Europe B.V.,
Netherlands & BRFL Italia S.r.l., Italy.
BRHL has registered a Net Profit of R 1.82 crores for the year ended
March 31, 2015.
(ii) DPJ Clothing Ltd, U.K.
DPJ Clothing Limited is engaged in business of wholesale marketing and
distribution of clothing products. The said subsidiary is assisting in
getting many mid-size retailers of Europe by providing the services
either by direct import or by import and delivery basis.
DPJ Clothing Ltd has registered loss of R 1.73 crores for the year
ended March 31, 2015.
(iii) BRFL Europe B.V., Netherlands.
BRFL Europe B.V. at Netherlands curtailed its operations to save costs
and most of the larger customers are directly dealt from
well-established service facilities from India offices.
BRFL Europe B.V. has registered a loss of R 0.04 crores for the year
ended March 31, 2015.
(iv) BRFL Italia S.r.l, Italy.
The Company owns the popular 'GURU' brand and is into the business of
retailing of ready-made garments as well as other accessories in
Europe.
The retail operations being not viable in the current prevailing
economic scenario, are totally closed and the brand 'GURU' is put on
license model for various popular products.
BRFL Italia S.r.l, Italy has registered a net loss of R 4935.26 lacs of
for the year ended December 31, 2014.
(v) STI India Limited (STI).
The Company is running the unit of STI on job work basis for the
manufacturing of yarn and knitted fabric. The part of manufactured yarn
is used for captive consumption and balance is sold.
STI has incurred a net Loss of R 4.78 crores for the year ended March
31, 2015.
(vi) BRFL Bangladesh Private Limited (BRFL Bangladesh).
The Company has not taken up any operations yet.
d. Dividend:
Considering the loss incurred in the current financial year, your
Directors have not recommended any dividend for the financial year
ended March 31, 2015.
2. DISCLOSURE OF INTERNAL FINANCIAL CONTROLS:
The Internal Financial Controls with reference to financial statements
as designed and implemented by the Company are adequate. During the
year under review, no material or serious observation has been received
from the Internal Auditors of the Company for inefficiency or
inadequacy of such controls.
3. PARTICULAR OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES:
All contracts / arrangements / transactions entered by the Company
during the financial year with related parties were in the ordinary
course of business and on an arm's length basis. None of the
transactions entered in to by the Company with related party were
material in nature exceeding the limit 10% of annual
standalone/consolidated turnover of the company.
The particulars of contracts or arrangements with related parties are
forming part of notes to Accounts in this Annual Report.
All Related party transactions are placed before the Audit Committee
and subsequently before the Board for its approval. Omnibus approval is
obtained on a yearly basis for transactions which are of repetitive
nature as per the policy on Materiality of and Dealing with Related
Party Transactions. The policy on related party transactions as
approved by the Board of Directors has been uploaded on the website of
the Company.
4. INCREASE OF BORROWING LIMITS AND LIMITS FOR PLEDGE/HYPOTHECATION/
MORTGAGE OF COMPANY'S ASSETS/PROPERTIES:
With a view to accommodate the need for long term/short term borrowings
for working capital requirement for the business the Company proposes
to increase its borrowing limits and consequently the limits for
pledge/hypothecation/ mortgage of its assets/properties upto R 7000
crores pursuant to the provisions of Section 180(1) (a) and Section
180(1) (c) of the Companies Act, 2013 by seeking your approval by way
of passing the Special Resolution at the ensuing Annual General Meeting
of the Company.
5. INCREASE IN AUTHORISED CAPITAL:
In order to keep the provision for issue of new shares as may be
required to meet the requirement of minimum public shareholding, it is
proposed to increase Authorised Capital of the Company from the
present, R 150,00,00,000 (Rupees One Hundred Fifty Crores only) divided
into 15,00,00,000 (Fifteen Crores) Equity Shares of R 10/- each to R
200,00,00,000 (Rupees Two Hundred Crores only) divided into
20,00,00,000 (Twenty Crores) Equity Shares of R 10/,ranking pari passu
with the existing shares in the Company
6. PAYMENT TO BANKERS AND STATUTORY AUTHORITIES:
During the year under review, there were delays in payment of dues to
Bankers as well as to statutory authorities.
7. MATTERS RELATED TO CHANGE IN DIRECTORS AND KEY MANAGERIAL PERSONNEL
AND DECLARATION BY INDEPENDENT DIRECTORS:
a. Changes in Board of Directors & Key Managerial Personnel:
I. Vacation of Office
A. Directors -
During the Financial Year 2014-2015 following nominee directors vacated
the office due to withdrawal of nomination:-
(i) Mr. Mukul Sarkar with effect from 28th November, 2014 on account of
withdrawal of his nomination by Export-Import Bank of India;
(ii) Mr. Babu Nambiar with effect from 30th January, 2015 on account of
withdrawal of his nomination by IDBI Bank Limited.
B. Company Secretary
Ms. Shivangi Sharma was appointed as the Company Secretary & Compliance
Officer of the Company with effect from 12th February, 2015, and
subsequently tendered her resignation on 20th March, 2015.
II. Appointments
(i) Mr. John Mathew (DIN: 01632626), appointed as an Additional
Director (Independent category) on the Board with effect from 22nd May,
2015 to hold office upto the date of ensuing Annual General Meeting;
(ii) Ms. Prachi Deshpande (DIN: 0295271) was appointed as an additional
Director on the Board designated as Director - Secretarial & Corporate
Affairs with effect from 1st June, 2015 to hold office upto the date of
ensuing Annual General Meeting.
Ms. Prachi Deshpande was also appointed as the Company Secretary &
Compliance Officer of the Company, Pursuant to the provisions of
Section 203 (1) (ii) of the Companies Act, 2013.
The Company has received notices from shareholders along with requisite
deposit proposing the candidature of Mr. John Mathew and Ms. Prachi
Deshpande for their appointment as Directors at the ensuing Annual
General Meeting.
III. Directors Retiring by Rotation
Pursuant to the provisions of Section 152 of the Companies Act, 2013,
Mr. Janardhan Agrawal and Mr. A. R. Mundra will retire by rotation at
the ensuing Annual General Meeting of the Company and being eligible,
have offered themselves for re-appointment. In accordance with the
provisions of the Act, none of the Independent Directors is liable to
retire by rotation.
IV. Application to Central Government
The Company is in the process of submitting application as required
pursuant to Section 197 read with Schedule V of the Companies Act, 2013
with regard to remuneration payable to Mr. Aman Agrawal & Mr. Prashant
Agrawal.
b. Declaration by Independent Directors:
The Company has received and taken on record the declarations received
from all the Independent Directors of the Company in accordance to
Section 149(6) of the Companies Act, 2013 confirming their independence
vis-a- vis the Company.
8. DISCLOSURES RELATED TO BOARD,COMMITTEES AND POLICIES:
a. Board Meetings:
Four meetings of Board of Directors were convened during the financial
year under review i.e. on 5th June, 2014, 30th July, 2014, 11th
November, 2014, and 12th February, 2015.
b. Director's Responsibility Statement:
In terms of Section 134(5) of the Companies Act, 2013, in relation to
the audited Annual Financial Statements of the Company for the year
ended 31st March, 2015, the Board of Directors hereby confirms that:
a. in the preparation of the annual accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures;
b. such accounting policies have been selected and applied
consistently and the Directors made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company as at 31st March, 2015, and of the loss of
the Company for that year;
c. proper and sufficient care was taken for the maintenance of
adequate accounting records in accordance with the provisions of this
Act for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities;
d. the annual accounts of the Company have been prepared on a going
concern basis;
e. internal financial controls have been laid down to be followed by
the Company and that such internal financial controls are adequate and
were operating effectively;
f. proper systems have been devised to ensure compliance with the
provisions of all applicable laws and that such systems were adequate
and operating effectively.
c. Committees :
(I) Audit Committee:
The Audit Committee of Directors was constituted pursuant to the
provisions of Section 177 of the Companies Act, 2013 read with Clause
49(III)(A) of the Listing Agreement.
The composition of the Audit Committee is in conformity with the
provisions of the said section. The Audit Committee comprises of:
1. Mr. A. Arumugham, Chairman, Independent Director
2. Mr. Suresh Vishwasrao, Independent Director
3. Mr. Naseer Ahmed, Independent Director*
4. Mr. A. R. Mundra, Executive Director- Finance
5. Mr. John Mathew, Independent Director**
* till 22nd May, 2015
** Appointed on 22nd May, 2015
The scope and terms of reference of the Audit Committee have been
amended in accordance with the Act and the Listing Agreement entered
into with the Stock Exchanges. During the year under review, the Board
of Directors of the Company had accepted all the recommendations of the
Committee.
(II) Nomination and Remuneration Committee:
The Nomination and Remuneration Committee of Directors as constituted
by the Board of Directors of the Company is in accordance with the
requirements of Section 178 of the Act.
The composition of the committee is as under:
1. Mr. Naseer Ahmed,Chairman, Independent Director
2. Mr. Suresh Vishwasrao, Independent Director
3. Mr. A. Arumugham, Independent Director
4. Mr. John Mathew, Independent Director*
* Appointed on 22nd May, 2015
The Board, on recommendation of the Nomination and Remuneration
Committee, has approved a policy setting out the criteria for review of
responsibilities of the Directors positive attributes, independence of
a Director and policy relating to remuneration for Directors, Key
Managerial Personnel and other employees in accordance with the
provisions of Section 178 of the Act.
(III) Stakeholders Relationship Committee:
The Stakeholder Relationship Committee of Directors was constituted
pursuant to the provisions of Section 178 of the Companies Act, 2013.
The composition of the committee is as under:
1. Mr. Janardhan Agrawal, Chairman
2. Mr. Prashant Agrawal, Managing Director
3. Mr. A.R. Mundra, Executive Director- Finance
The Company Secretary acts as the Secretary of the Stakeholders'
Relationship Committee.
d. Policies:
(I) Vigil Mechanism Policy:
In compliance of the requirements of section 177 of the companies Act,
2013, Clause 49 of the listing Agreement and as measure of good
Corporate Governance practice, the Board has formulated a Vigil
Mechanism Policy. The policy comprehensively provides an opportunity
for any employee/ Director of the Company to raise any issue concerning
breaches, accounting policies or any act resulting in financial or
reputation loss and misuse of office or suspected or actual fraud. The
policy is a adequate safeguard against victimization.
The Board of Directors of the Company has, pursuant to the provisions
of Section 178(9) of the Companies Act, 2013 read with Rule 7 of the
Companies (Meetings of Board and its Powers) Rules, 2014, framed "Vigil
Mechanism Policy" for Directors and Employees of the Company to provide
a mechanism which ensures adequate safeguards to employees and
Directors from any victimization on raising of concerns of any
violations of legal or regulatory requirements, incorrect or
misrepresentation of any, financial statements and reports, etc. and
the same is also hosted on the website of the Company.
The employees of the Company have the right/option to report their
concern/grievance to the Chairman of the Audit Committee.
The Company is committed to adhere to the highest standards of ethical,
moral and legal conduct of business operations.
(II) Risk Management Policy:
The Board of Directors of the Company has designed Risk Management
Policy and Guidelines to avoid events, situations or circumstances
which may lead to negative consequences on the Company's businesses,
and define a structured approach to manage uncertainty and to make use
of these in their decision making pertaining to all business divisions
and corporate functions. Key business risks and their mitigation are
considered in the annual/strategic business plans and in periodic
management reviews.
(III) Corporate Social Responsibility Policy:
As per the provisions of Section 135 of the Act read with Companies
(Corporate Social Responsibility Policy) Rules, 2014, the Board of
Directors has constituted a Corporate Social Responsibility (CSR)
Committee as under:
1. Mr. Suresh Vishwasrao - Independent Director (Chairman)
2. Mr. A. Arumugham- Independent Director
3. Mr. A. R. Mundra - Executive Director
The Company has drafted the Corporate Social Responsibility Policy
which may be accessed on the web-site of the Company i.e.
www.bombayrayon.com.
Since, the Company has incurred losses in FY 2013-14 & FY 2014-15, the
Company has not spent any amount towards Corporate Social
Responsibility activities.
e. Annual Evaluation of Directors, Committee and Board:
Independent Directors had reviewed the performance of the Chairman and
Executive Directors considering the performance of the Company during
the FY 2014-15. Board of Directors in their meeting has reviewed the
contribution made by each Independent Director in the performance of
the Company by way of their timely advice. Due to losses for FY 2014-15
there is no change in the remuneration payable to the Directors for
next FY 2015-16 neither the Chairman will receive any commission.
f. Details with Respect to the Programme for Familiarisation of
Independent Directors:
The details of programme for familiarization of Independent Directors
with the Company, their roles, rights, responsibilities in the Company,
nature of the industry in which the Company operates, business model of
the Company and related matters are put up on the website of the
Company.
g. Internal Control Systems:
Adequate internal control systems commensurate with the nature of the
Company's business and size and complexity of its operations are in
place has been operating satisfactorily. Internal control systems
comprising of policies and procedures are designed to ensure
reliability of financial reporting, timely feedback on achievement of
operational and strategic goals, compliance with policies, procedure,
applicable laws and regulations and that all assets and resources are
acquired economically, used efficiently and adequately protected.
9. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
Pursuant to the Provisions of section 197(12) of the Companies Act,
2013 read with Rule 5(1) of the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014, the requisite details are annexed
herewith vide Annexure II and are also available at the Registered
Office of Company for inspection during its working hours and any
member interested in obtaining such information may directly write to
the Company Secretary of Company and the same shall be provided on such
request.
10. AUDITORS AND REPORTS:
a. Statutory Auditors:
The observations made by the Statutory Auditors in their Report read
with the relevant notes as given in the Notes to Accounts for the year
ended March 31, 2015, are self-explanatory and therefore do not call
for any further comments under Section 134(3) of the Companies Act,
2013. The Auditors' Report does not contain any qualification,
reservation and adverse remark.
Pursuant to the provisions of Section 139 of the Companies Act, 2013
and the Companies (Audit and Auditors) Rules, 2014, M/s. V.K. Beswal &
Associates, Chartered Accountants, Mumbai (Firm Registration Number:
101083W),the Statutory Auditors of the Company, hold office upto the
conclusion of the ensuing Annual General Meeting. The consent of the
Auditors along with certificate under Section 139 of the Act have been
obtained from the Auditors to the effect that their appointment, if
made, shall be in accordance with the prescribed conditions and that
they are eligible to hold the office of Auditors of the Company. The
Board recommends the appointment of M/s. V.K. Beswal & Associates,
Chartered Accountants, Mumbai (Firm Registration Number: 101083W), as
the Statutory Auditors of the Company for the financial year 2015-2016.
Necessary resolution for appointment of the said Auditors is included
in the Notice of Annual General Meeting for seeking approval of
members.
b. Secretarial Audit Report for the year ended 31st March, 2015:
The Board had appointed Rathi & Associates, Company Secretaries as
Secretarial auditors for the financial year 2014- 15. Secretarial Audit
Report issued by Rathi & Associates in form MR-3 for the FY 2014-15
forms part of this report and marked as Annexure III.
As mentioned hereinabove in this report the Company is in the process
of submitting application as required pursuant to Section 197 read with
Schedule V of the Companies Act, 2013 with regard to remuneration
payable to Vice Chairman & Managing Director.
The company and the promoters are in the process to take action to
comply with the regulations of Securities and Exchange Board of India
related to Minimum public Shareholding (MPS) to increase the public
shareholding to 25%.
c. Cost Auditors:
Pursuant to the provisions of Section 148 of the Companies Act, 2013
read with Notifications/Circulars issued by the Ministry of Corporate
Affairs from time to time, as per the recommendation of the Audit
Committee, the Board of Directors at their meeting dated 22nd May,
2015, appointed M/s. K. S. Kamalakara & Company, Cost Accountants as
the Cost Auditors of the Company for the financial year 2015-16 at
annual audit fee of R 5,00,000/- .
d. Internal Audit and Control:
M/s Venkatram & Co., Firm Registration No. 004656S, Chartered
Accountants, Internal Auditors of the Company have carried out internal
audit and the findings of the Internal Auditors in their reports are
discussed on an on-going basis in the meetings of the Audit Committee
and corrective actions are taken as per the directions of the Audit
Committee.
11. OTHER DISCLOSURES:
Other disclosures as per provisions of Section 134 of the Act read with
Companies (Accounts) Rules, 2014 are furnished as under:
a. Extract of Annual Return:
Pursuant to the provisions of Section 134(3)(a) of the Companies Act,
2013, Extract of the Annual Return for the financial year ended 31st
March, 2015 made under the provisions of Section 92(3) of the Act is
attached as Annexure IV which forms part of this Report.
b. Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings and Outgo:
The particulars as required under the provisions of Section 134(3)(m)
of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts)
Rules, 2014 in respect of conservation of energy, technology
absorption, foreign exchange earnings and outgo etc. are furnished in
Annexure V which forms part of this Report.
c. Corporate Governace and Management Discussion & Analysis Reports:
The Company is committed to maintain the high standards of Corporate
Governance and adheres to its requisites set out by the respective
authorities. The report on Corporate Governance as stipulated under the
Listing Agreement is annexed vide Annexure VI and forms an integral
part of this Annual Report.
Requisite certificate from the Auditors of the Company M/s V. K. Beswal
& Associates, Chartered Accountants,(Firm Registration Number:
101083W), confirming compliance with the conditions of Corporate
Governance as stipulated under Clause 49 of Listing Agreement is
appended herewith vide Annexure VI(A) and forms an integral part of
this Annual Report.
Certificate issued by Managing Director and Executive Director of
Company with regard to certification on Audited Financial Statement of
the Company for F. Y. 2014-15 is also annexed herewith vide Annexure VI
(B) and forms an integral part of this Annual Report.
The Company has suitably laid down the Code of Conduct for all Board
Members and Senior Management personnel of the Company. The declaration
by CEO i.e. Managing Director of company related to the compliance of
aforesaid Code of Conduct is also attached herewith vide Annexure VI(C)
and forms an integral part of this Annual Report.
Management Discussion and Analysis Report for the year under review, as
required pursuant to the provisions of Clause 49 of the Listing
Agreement, is annexed herewith vide Annexure VII and forms part of this
Annual Report.
d. General Disclosures:
Your Directors state that no disclosure or reporting is required in
respect of the following items as there were no transactions pertaining
to these matters during F.Y. 2014-15:
a. Details relating to acceptance of deposits covered under Chapter V
of the Companies Act, 2013.
b. Issue of equity shares with differential rights as to dividend,
voting or otherwise.
c. Issue of shares (including sweat equity shares and ESOS) to
employees of the Company under any scheme.
d. Instances with respect to voting rights not exercised directly by
employees of the Company.
e. There was no revision of the financial statements for the year
under review.
f. During the financial year company has neither provided any loans
and guarantees nor made any investments.
Your Directors further state that:
g. Neither the Managing Director nor the Whole-time Directors of the
Company receive any remuneration or commission from any of the
subsidiary Company.
h. 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.
i. Except as disclosed elsewhere in this report, no material changes
and commitments which could affect the Company's financial position,
have occurred between the end of the financial year of the Company and
date of this Annual Report.
j. There was no change in the nature of business of company during F.
Y. 2014-15.
k. Pursuant to the provisions of Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013, no case
pertaining to sexual harassment at workplace has been reported to
company during F.Y. 2014-15.
12. ACKNOWLEDGEMENTS AND APPRECIATION:
Your Directors take this opportunity to thank the customers,
shareholders, suppliers, bankers, business partners/ associates,
financial institutions and Central and State Governments for their
consistent support and encouragement to the Company.
Your Directors records with sincere appreciation the valuable
contribution made by employees at all levels and looks forward to their
continued commitment to achieve further growth and take up more
challenges that the Company has set for the future.
For and on behalf of the Board of Directors
Janardhan Agrawal
Chairman
DIN:00019497
Place: Mumbai
Date: August 14, 2015
Registered Office Address:
D 1st Floor, Oberoi Garden Estates, Chandivali Farms,
Chandivali, Andheri (East), Mumbai - 400072
CIN:L17120MH1992PLC066880
TEL No: 91 22 39858800
Fax No : 39858700
Mail:[email protected]
Website: www.bombayrayon.com
Mar 31, 2014
Dear Shareholders,
The Directors have pleasure in presenting their Report on the
operations of the Company together with the Annual Audited Accounts for
the financial year ended March 31, 2014.
(Rs. in crores)
Particulars March31 March 31
2014 2014
Revenue from Operations 2907.36 3194.79
Profit before Interest, 451.65 820.95
Depreciation and Tax
Less: Interest 450.19 239.81
Profit before Depreciation 1.46 581.14
and Tax
Less: Depreciation 275.76 271.22
Profit / (Loss) before (274.30) 309.92
Extraordinary Items and
Tax
Less: Excess Provision for - (13.94)
FBT written back
Exceptional Items - Prior 3.80 -
Period items (net)
Extra Ordinary Items
- Stock valuation difference (258.36) -
written off
- Foreign Exchange Rate (90.92) -
fluctuation Loss
Less: Provision for taxes 209.91 (107.22)
(Deferred Tax)
Profit / (Loss) after tax (409.87) 188.76
EPS(Rs.) - Basic - 14.02
EPS(Rs.) - Diluted - 14.02
During the year under review, the Company''s debts availed from the
Banks/ financial institutions were restructured due to which flow of
orders from overseas customers slowed down as the customers were
awaiting the status of the Company post implementation of debt
restructuring package by the bankers. On account of the same, export
sales of the Company has declined substantially from Rs. 1227.17 crores
in FY 2012-13 to Rs. 473.20 crores in FY 2013-14.
However though, the Company has strived to enhance the growth of its
domestic sales from Rs. 1972.85 crores in FY 12-13 to Rs. 2434.16 crores in
FY 13-14, resulting in an increase by almost 23%. Total revenue from
operations has reduced to Rs. 2907.62 crores from Rs. 3194.79 crores in FY
2012-13. The net loss incurred for the year was Rs. 409.87 crores after
Extra-ordinary items of Rs. 349.28 crores.
DIVIDEND
Considering the loss for the FY 2013-14, your Directors have decided
not to recommend any dividend for the year ended 31st March, 2014.
RESTRUCTURING OF DEBTS:
Your Company has carried out various expansions since 2005 and all the
expansions were completed by the FY. 2012-13. During the execution of
various projects, there was huge inventory generated which was required
to put at its realizable value. The Management of the Company carried
out extensive exercise for valuation of its inventories in the first
quarter of FY 2013-14 and an amount of Rs. 258.36 crores was written off
as valuation difference. Further, in the same quarter Rs. 90.92 crores
was also written off being loss on exchange fluctuation on outstanding
working capital limits under foreign currency.
In addition to losses incurred in the first quarter of the financial
year, there were other factors which have adversely impacted the
profitability and cash flows of the Company like:
- Slowdown in European and US Markets
- Large Scale Expansion
- Advances to Subsidiaries
- Redemption of Commercial Papers
- Delay in receipt of TUFS subsidy and other refunds
- Increase in debt and Financing Cost
resulting in delay in fulfilling the commitment with lenders. On
account of the same, the Company approached the lenders and they had
referred their total debt of around Rs. 4000 crores to the Corporate Debt
Restructuring (CDR) Cell. The CDR Empowered Group formally accepted the
Company''s proposal on September 26, 2013. Under the regulatory frame
work of the Reserve Bank of India (RBI), the CDR forum caters to an
official platform for both the lenders and borrowers to amicably and
collectively evolve policies for working out debt restructuring plans.
The broad contours of this restructuring exercise involves
restructuring of repayment schedule for term loans under Technology
Upgradation Funds Scheme (TUFS) and Non -TUFS Term Loans, reduction in
interest rates, additional facilities in the form of Working Capital
Term Loan (WCTL) & Funded Interest Term Loan (FITL) and reduction in
interest rate. This debt restructuring will provide the company with
breathing space to work on improving operational margins.
DIRECTORS:
Dr. B. S. Bhesania and Dr. S. B. Agarwal have stepped down from the
Company''s Board w.e.f August 12, 2013 and August 22, 2013 respectively.
Mr. UdayMogre has resigned as Whole - time Director designated as
Executive Director - Corporate
w.e.f December 31, 2013. The Board places on record their appreciation
for the valuable guidance and services rendered by the three Directors.
In accordance with the provisions of Section 149 and 152 of the
Companies Act, 2013, Independent Directors are required to be appointed
for a term of five consecutive years and shall not be liable to retire
by rotation. Accordingly, the Company seeks your approval for
appointment of Mr. Naseer Ahmed, Mr. Suresh Vishwasrao, Mr. M. M.
Agrawal and Mr. A. Arumugham as Independent Directors for the period
upto March 31, 2019.
The Company has received Notices under Section 160 of the Companies
Act, 2013 from members proposing the appointment of Mr. Naseer Ahmed,
Mr. Suresh Vishwasrao, Mr. M. M. Agrawal and Mr. A. Arumugham as
Independent Directors of the Company together with requisite deposit.
The Company has also received the requisite disclosures from all the
Independent Directors of the Company confirming that they meet the
criteria of independence as prescribed under both sub-section (6) of
section 149 of the Companies Act, 2013 and under clause 49 of the
Listing Agreement with Stock Exchanges.
Mr. Aman Agrawal and Mr. Prashant Agrawal retire by rotation at the
ensuing Annual General Meeting, and being eligible, have offered
themselves for re-appointment.
The information to shareholders pursuant to the applicable provisions
of the Companies Act, 2013 read with Clause 49 of the Listing Agreement
of all the above mentioned Directors is annexed hereto and forms part
of this Annual Report.
INCREASE OF BORROWING LIMITS AND LIMITS PERTAINING TO
PLEDGE/HYPOTHECATION OF COMPANY''S ASSETS:
On account of Corporate Debt Restructuring, the Company increased its
borrowing powers and the limits pertaining to pledge/hypothecation of
its assets upto v5500 crores pursuant to the provisions of Section
180(1) (a) and Section 180(1)(c) of the Companies Act, 2013 by seeking
your approval by way of passing of Special Resolution at the
Extra-ordinary General Meeting held on 30th September, 2013.
DIRECTORS'' RESPONSIBILITY STATEMENT:
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
confirm the following:
1. That in the preparation of the annual accounts, the applicable
accounting standards have been followed and that there are no material
departures.
2. That they have selected such accounting policies in consultation
with Statutory Auditors and other experts and applied them consistently
and made judgments and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the Company at
the end of the financial year viz March 31, 2014 and of the Loss of the
Company for that year.
3. That they have taken proper and sufficient care to the best of
their knowledge and ability for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities.
4. That they have prepared the attached Statement of Accounts for the
year ended March 31, 2014 on a going concern basis.
CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION & ANALYSIS REPORT:
Report on the Corporate Governance as stipulated under Clause 49 of the
Listing Agreement with the Stock Exchanges along with a certificate
from M/s. V. K. Beswal & Associates, Chartered Accountants, (Firm
Registration Number: 101083W), Statutory Auditors confirming compliance
is set out in the annexure forming part of this Report. The Management
Discussion and Analysis Report on the operations of the Company as
required under the Listing Agreement with the Stock Exchanges is also
annexed hereto and forms part of this Report.
AUDITORS:
The Statutory Auditors of the Company, M/s V. K. Beswal & Associates,
Chartered Accountants, Mumbai (Firm Registration Number: 101083W) shall
hold office till the conclusion of the ensuing Annual General Meeting
and are eligible for re-appointment. M/s V. K. Beswal & Associates,
Chartered Accountants have expressed their willingness to act as the
Statutory Auditors of the Company, and furnished to the Company a
certificate that their appointment, if made, would be in conformity
with the provisions of Section 139(1) of Companies Act, 2013.
AUDITORS'' REPORT:
The observations made by the Statutory Auditors in their Report read
with the relevant notes as given in the Notes to Accounts for the year
ended March 31, 2014, are self-explanatory and therefore do not call
for any further comments under Section 217(3) of the Companies Act,
1956.
PARTICULARS OF EMPLOYEES:
The information required under section 217 (2A) of the Companies Act,
1956 read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the names and the other particulars of the employees are set
out in the annexure to the Directors'' Report. Having regard to Section
219(1)(b) (iv) of the said Act, Annual Report excluding the aforesaid
information is being sent to all the members of the Company and others
entitled thereto.
Any member interested in obtaining such particulars may write to the
Company Secretary at the registered office of the Company.
CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY
ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars as prescribed under section 217 (1) (e) of the
Companies Act, 1956, read with the Companies (Disclosure
of Particulars in the Report of the Board of Directors) Rules, 1988,
are set out in annexure to this report.
PUBLIC DEPOSITS:
The Company has not accepted any amount falling within the purview of
"Public Deposit" as per the provisions of Section 58A of the Companies
Act, 1956 read with the Companies (Acceptance of Deposit) Rules, 1975.
SUBSIDIARY COMPANIES:
(i) Bombay Rayon Holdings Limited (BRHL).
BRHL holds 100% Equity of foreign subsidiaries, BRFL Europe B.V.,
Netherlands & BRFL Italia S.r.l., Italy.
BRHL has registered a Net Profit of v 2.74 crores for the year ended
March 31, 2014.
(ii) DPJ Clothing Ltd, U.K.
DPJ Clothing Limited is engaged in business of wholesale marketing and
distribution of clothing products. The said subsidiary is assisting in
getting many mid-size retailers of Europe by providing the services
either by direct import or by import and delivery basis.
DPJ Clothing Ltd has registered loss of GBP 330,903 for the year ended
March 31, 2014.
(iii) BRFL Europe B.V., Netherlands.
BRFL Europe B.V. at Netherlands curtailed its operations to save costs
and most of the larger customers are directly dealt from well
established service facilities from India offices.
BRFL Europe B.V. has registered a loss of Euro 5.418 for the year ended
March 31, 2014.
(iv) BRFL Italia S.r.l, Italy.
The Company owns the popular ''GURU'' brand and is into the business of
retailing of ready-made garments as well as other accessories in
Europe.
The retail operations being not viable in the current prevailing
economic scenario are totally closed and the brand ''GURU'' is put on
license model for various popular products.
BRFL Italia S.r.l, Italy has registered a net loss of Euro 8.284
thousand for the year ended December 31, 2013.
(v) STI India Limited (STI).
The Company is running the unit of STI on job work basis for the
manufacturing of yarn and knitted fabric. The part of manufactured yarn
is used for captive consumption and balance is sold.
STI has incurred a net Loss of v 6.67 crores for the year ended March
31, 2014.
(vi) BRFL Bangladesh Private Limited (BRFL Bangladesh).
The Company has not taken up any operations yet.
In accordance with general circular issued by the Ministry of Corporate
Affairs, Government of India, the Balance Sheet & Profit and Loss
Account of the subsidiary companies are not attached. However, the
financial information of the Subsidiary Company is disclosed in the
Annual Report in compliance with the said circular.
ACKNOWLEDGEMENTS:
YourDirectors wishes to express its sincere appreciation and thanks to
our Bankers, Regulatory authorities, State Government and Central
Government, Customers, Suppliers and other stakeholders for their
consistent support and cooperation.
Your Directors appreciate the contribution made by the employees of the
Company and acknowledge their hard work and dedication. The Directors
are thankful to the esteemed shareholders for their support and the
confidence reposed in the Company.
For and on behalf of the Board
Janardhan Agrawal
Chairman
Place: Mumbai
Date: July 30, 2014
Mar 31, 2013
Dear Shareholders,
The Directors have pleasure in presenting their Report on the
operations of the Company together with the Audited Accounts for the
financial year ended 31st March, 2013.
(Rs. in crores)
Particulars 31st March, 2013 31st March, 2012
Sales 3194.79 2734.96
Profit before Interest, 820.95 713.12
Depreciation and Tax
Less: Interest 239.81 188.25
Profit before Depreciation 581.14 524.87
and Tax
Less: Depreciation 271.22 217.23
Profit before Extraordinary 309.92 307.64
Items and Tax
Less: Excess/(Short) (13.94) 0.11
Provision for FBT written back
Less: Provision for taxes 107.22 101.24
(including deferred)
Profit after tax 188.76 206.51
- Basic 14.02 15.50
- Diluted 14.02 14.67
During the year under review, all the ongoing projects of the Company
have fully commenced and have started commercial operations. The
revenue from operations has increased to Rs. 3194.79 Crores from Rs.
2734.96 Crores in previous year. An increase in revenue is mainly due
to jump in fabric sale in local markets, by 36% as compared to previous
year.
DIVIDEND
With a view to conserve the resources for the Company''s business
operations, your directors have deemed it prudent not to recommend any
dividend for the year ended 31st March, 2013.
CONSOLIDATION OF BUSINESS:
In the past years the company has set up additional manufacturing
facilitates at various locations in the State of Maharashtra and
Karnataka. During the year under review the Company had focused in
consolidating the business operations at various locations to get the
optimum advantage of the set up facilities.
DIRECTORS:
During the period under review, Dr. Pravin P Shah Independent director
of the board had passed away on 4th December, 2012. The Board
expresses its deep condolence on the sudden demise of Dr. Pravin R
Shah.
Dr. S. B. Agarwal and Dr. B. S. Bhesania stepped down from the
Company''s Board with effect from 12th August, 2013 and 22nd August,
2013 respectively.
Further, in accordance with the provisions of Section 255 read with
Section 266 the Companies Act, 1956 and the Company''s Articles of
Association, Mr. Janardhan Agrawal, Mr. Naseer Ahmed, and Mr. A. R.
Mundra Directors of the Company shall retire by rotation at the
forthcoming Annual General Meeting and being eligible, offer themselves
for re-appointment.
Furthermore, the tenure of Mr. Aman Agrawal as the Whole- time
Director, designated as Vice Chairman, Mr. Prashant Agrawal as the
Managing Director, Mr. Uday Mogre as the Whole-time Director,
designated as Executive Director - Corporate and Mr. A. R. Mundra as
the Whole-time Director, designated as Executive Director - Finance
expired on 31st May, 2013. The Board recommends their respective
re-appointment a further tenure of three years commencing from 1st
June, 2013.
Also, Mr. AArumugham and Mr. Babu Nambiar were inducted on the
Company''s Board with effect from 22nd August, 2013.
The information to shareholders pursuant to Clause 49 of the Listing
Agreement pertaining to brief resume, expertise in functional areas,
names of Companies in which all the above mentioned Directors are
interested respectively etc. forms part of this Annual Report.
DIRECTORS'' RESPONSIBILITY STATEMENT:
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
confirm the following:
1. that in the preparation of the annual accounts, the applicable
accounting standards have been followed and that there are no material
departures;
2. that they have selected such accounting policies in consultation
with Statutory Auditors and other Experts and applied them consistently
and made judgments and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the Company at
the end of the financial year viz 31st March, 2013 and of the Profit of
the Company for that year.
3. that they have taken proper and sufficient care to the best of
their knowledge and ability for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities.
4. that they have prepared the attached Statement of Accounts for the
year ended 31st March, 2013 on a going concern basis.
CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION & ANALYSIS REPORT:
A report on the Corporate Governance as stipulated under clause 49 of
the Listing Agreement with the Stock Exchanges along with a certificate
from M/s. V. K. Beswal & Associates, Chartered Accountants, Statutory
Auditors confirming compliance is set out in the annexure forming part
of this Report. The Management Discussion and Analysis Report on the
operations of the Company as required under the Listing Agreement with
the Stock Exchanges is also annexed hereto and forms part of this
Report.
AUDITORS:
The Statutory Auditors of the Company, M/s V. K. Beswal & Associates,
Chartered Accountants, Mumbai (Firm Registration Number: 101083W) shall
hold office till the conclusion of the ensuing Annual General Meeting
and are eligible for re-appointment. M/s V. K. Beswal & Associates,
Chartered Accountants have expressed their willingness to act as the
Statutory Auditors of the Company, and furnished to the Company a
certificate from that their appointment, if made, would be in
conformity with the provisions of Section 224 (1B) of Companies Act,
1956.
AUDITORS'' REPORT:
The observations made by the Statutory Auditors in their Report read
with the relevant notes as given in the Notes to Accounts for the year
ended 31st March, 2013, are self-explanatory and therefore do not call
for any further comments under Section 217(3) of the Companies Act,
1956.
PARTICULARS OF EMPLOYEES:
The information required under section 217 (2A) of the Companies Act,
1956 read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the names and the other particulars of the employees are set
out in the annexure to the Directors'' Report. Having regard to
section 219 (1) (b) (iv) of the said Act, Annual Report excluding the
aforesaid information is being sent to all the members of the Company
and other entitled thereto. Any member interested in obtaining such
particulars may write to the Company Secretary at the registered office
of the Company.
CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY
ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars as prescribed under section 217 (1) (e) of the
Companies Act, 1956, read with the Companies (Disclosure of Particulars
in the Report of the Board of Directors) Rules, 1988, are set out in
annexure to this report.
PUBLIC DEPOSITS:
The Company has not accepted any amount falling with the purview of
"Public Deposit" as per the provisions of Section 58A of the
Companies Act, 1956 read with the Companies (Acceptance of Deposits)
Rules, 1975.
SUBSIDIARY COMPANIES:
(i) Bombay Rayon Holdings Limited (BRHL).
BRHL holds 100% equity of foreign subsidiaries BRFL Europe B.V.,
Netherlands & BRFL Italia S.r.l., Italy.
BRHL has registered a net profit of f 2.41 Crores for the year ended
31st March, 2013.
(ii) DPJ Clothing Ltd, U.K.
DPJ Clothing Limited is engaged in business of wholesale marketing and
distribution of clothing Products. The said subsidiary is assisting in
getting many mid size retailers of Europe by providing the services
either by direct import or by import and delivery basis. Your Company
continued to reap benefits in expanding its business in Europe.
DPJ Clothing Ltd has registered loss of GBP 293,383 for the year ended
31st March, 2013.
(iii) BRFL Europe B.V., Netherlands.
BRFL Europe B.V. at Netherlands curtailed its operations to save costs
and most of the larger customers are directly dealt from well
established service facilities from India offices.
BRFL Europe B.V. has registered a loss of Euro 4,465 for the year ended
31st March, 2013.
(iv) BRFL Italia S.r.l, Italy.
The Company owns the popular ''GURU'' brand and is into the business
of retailing of ready-made garments as well as other accessories in
Europe.
The economic environment in that part of world is gloomy and to keep
the business operations fit, the activities are being restructured,
putting the license model for the brand at place for various modals.
BRFL Italia S.r.l, Italy has registered a net loss of Euro 7.267
thousand for the period ended 31st December, 2012.
(V) STI India Limited (STI).
The Company is running the unit of STI on job work basis for the
manufacturing of yarn and knitted fabric. The part of manufactured
yarn is used for in-house consumption and balance is sold.
STI has registered a net Loss of Rs. 9.33 Crores ended 31st March,
2013.
(vi) BRFL Bangladesh Private Limited (BRFL Bangladesh).
The Company has been incorporated for activities in Bangladesh, but
operations presently not commenced due to unfavorable business
environments.
The Company has availed exemption pursuant to the General Circular No.
2/2011 dated 8th February, 2011 issued by the Ministry of Corporate
Affairs; from attaching the Annual Accounts of its subsidiaries vide
its Board''s approval on 22nd August, 2013. The Company undertakes
that the annual accounts of the subsidiary companies and the related
detailed information shall be made available to the shareholders of the
holding and subsidiary companies seeking such information at any point
of time. The annual accounts of the subsidiary companies are available
for inspection by the shareholders at the Registered Office of the
Company and its Subsidiaries.
ACKNOWLEDGEMENTS:
Your Directors express sincere appreciations for the co-operation and
support from our Regulatory Authorities, Shareholders, Bankers,
Suppliers, Customers, and other Stakeholders. We look forward to
receiving their continued support and encouragement.
The Board of Directors expresses its gratitude and records its sincere
appreciation of the dedicated efforts and commitment of all the
employees.
For and on behalf of the Board
Place: Mumbai Janardhan Agrawal
Date: 22nd August, 2013 Chairman
Mar 31, 2012
Dear Shareholders,
The Directors have pleasure in presenting their Report on the
operations of the Company together with the Audited Accounts for the
financial year ended March 31, 2012.
(Rs. in crores)
Particulars As at March As at March
31,2012 31,2011
Sales 2734.96 2254.84
Profit before Interest, 746.40 564.36
Depreciation and Tax
Less: Interest 221.53 145.21
Proft before Depreciation 524.87 419.15
and Tax
Less: Depreciation 217.23 136.67
Profit before Extraordinary 307.64 282.48
Items and Tax
Less: Excess Provision for -0.11 -
FBT written back
Profit Before Tax 307.75 282.48
Less: Provision for taxes (101.24) 55.78
(including deferred)
Profit after tax 206.51 226.69
Basic 15.50 19.06
Diluted 14.67 17.70
Your Company has achieved commencement of yarn dyeing & fabric weaving
facilities at Tarapur and weaving at Islampur in Maharashtra during the
FY 2011-12. The total turnover has increased to Rs. 2734.96 crores as
compared to Rs. 2254.84 crores in the previous year. Exports were
higher at Rs. 1323.11 crores as against Rs. 1110.70 crores previous
year an increase of 19%.
The operating margins were improved but the net profit was under stress
due to increased financial costs and depreciations because of expansion
pans and higher interest rates.
DIVIDEND
With a view to conserve the resources for the Companys business
operations, your Directors have deemed it prudent not to recommend any
dividend for the year ended March 31, 2012.
BUSINESS DEVLOPMENT:
1. Completion of expansion of manufacturing facilities:
The Directors are pleased to inform that during the year under review,
your Company has successfully commenced the commercial production of
its last phase of expansion projects of yarn dyeing at Tarapur &
weaving at Islampur & Tarapur and consequently completing the all
ongoing expansion projects.
The cost of the expansion project was funded partly by equity capital
already raised and the balance by way of term loans under Technology
Upgradation Fund Scheme (TUFs) entitling the Company an interest
subsidy of 5% and in addition capital subsidy of 10% on the total
investment in Processing & Garment Machineries.
2. Changes in Share Capital and Shareholding Pattern:
(i) Changes in Share Capital
During the year under review your company has allotted - 42.00.000
equity shares to Reynold Shirting Limited, a promoter group company on
exercise of option for conversion of warrants into equal number of
equity shares at an exercise price of Rs. 193/- per share.
25.00.000 equity shares to B. R. Machine Tools Private Limited, a
promoter group company on exercise of option for conversion of warrants
into equal number of equity shares at an exercise price of Rs. 263/-
per share.
Consequent to conversion the paid up capital of the Company increased
from Rs. 127.90 crores consisting of 12,79,00,000 equity shares of Rs.
10/- each to Rs. 134.60 crores consisting of 13,46,00,000 equity shares
of Rs. 10/- each.
(ii) Changes in Shareholding Pattern
During the year under review on of the shareholder of the Company, AAA
United B. V, a Company incorporated under the Laws of Netherlands (AAA)
has opted for conversion of 3,30,00,000 Global Depository Receipts
(GDRs) into equal number of equity shares which triggered an open offer
to the existing shareholders. On the closure of open offer an Indian
company, Ashwell Holding Company Pvt. Ltd. has acquired 2,84,20,000
equity shares, making the shareholding of promoters and persons acting
in concert at 93.15% of the total paid up capital of the company.
DIRECTORS:
Mr. Mukul Sarkar, a Nominee Director has been appointed by Export
Import Bank of India on June 26, 2011 in place of Mr. K. Muthukumaran.
In accordance with the provisions of Section 255 read with Section 266
the Companies Act, 1956 and the Companys Articles of Association,
Mr. Suresh Vishwasrao, Mr. Uday Mogre and Mr. M. M. Agrawal, Directors
of the Company shall retire by rotation at the forthcoming Annual
General Meeting and being eligible, offer themselves for
re-appointment.
The information to shareholders pursuant to Clause 49 of the Listing
Agreement pertaining to brief resume, expertise in functional areas,
names of Companies in which Mr. Suresh Vishwasrao, Mr. Uday Mogre and
Mr. M. M. Agrawal ,are Directors respectively is forming part of the
Annual Report.
DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
confirm the following:
1. that in the preparation of the annual accounts, the applicable
accounting standards have been followed and that there are no material
departures;
2. that they have selected such accounting policies in consultation
with Statutory Auditors and other Experts and applied them consistently
and made judgments and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the Company at
the end of the financial year viz March 31, 2012 and of the Profit of
the Company for that year.
3. that they have taken proper and sufficient care to the best of
their knowledge and ability for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities.
4. that they have prepared the attached Statement of Accounts for the
year ended March 31, 2012 on a going concern basis.
CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION & ANALYSIS REPORT:
A report on the Corporate Governance as stipulated under clause 49 of
the Listing Agreement with the Stock Exchanges along with a certificate
from M/s. V. K. Beswal & Associates, Chartered Accountants, Statutory
Auditors confirming compliance is set out in the annexure forming part
of this Report. The Management Discussion and Analysis Report on the
operations of the Company as required under the Listing Agreement with
the Stock Exchanges is also annexed hereto and forms part of this
Report
AUDITORS:
The Statutory Auditors of the Company, M/s V. K. Beswal & Associates,
Chartered Accountants, Mumbai (Firm Registration Number: 101083W) shall
hold office till the conclusion of the ensuing Annual General Meeting
and are eligible for re-appointment. M/s V. K. Beswal & Associates,
Chartered Accountants have expressed their willingness to act as the
Statutory Auditors of the Company, and furnished to the Company a
certificate from that their appointment, if made, would be in
conformity with the provisions of Section 224 (1B) of Companies Act,
1956.
AUDITORS REPORT:
The observations made by the Statutory Auditors in their Report read
with the relevant notes as given in the Notes to Accounts for the year
ended March 31, 2012, are self- explanatory and therefore do not call
for any further comments under Section 217(3) of the Companies Act,
1956.
FIXED DEPOSITS:
The Company has not accepted or renewed any deposit from public during
the year under review.
PARTICULARS OF EMPLOYEES:
The information required under section 217 (2A) of the Companies Act,
1956 read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the names and the other particulars of the employees are set
out in the annexure to the Directors Report. Having regard to
section 219 (1) (b) (iv) of the said Act, Annual Report excluding the
aforesaid information is being sent to all the members of the Company
and other entitled thereto. Any member interested in obtaining such
particulars may write to the Company Secretary at the registered office
of the Company.
CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY
ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars as prescribed under section 217 (1) (e) of the
Companies Act, 1956, read with the Companies (Disclosure of Particulars
in the Report of the Board of Directors) Rules, 1988, are set out in
annexure to this report.
DEPOSITORY SYSTEM:
Your Companys Equity Shares are available for dematerialization
through National Securities Depository Limited and Central Depository
Services (India) Limited. As on March 31, 2012, 99.97% of the Equity
Shares of the Company were in dematerialized form.
CONVERSION OF GDRS/WARRANTS AND OTHER MAJOR CORPORATE ACTIVITY DURING
THE YEAR SUBSIDIARY COMPANIES:
(i) Bombay Rayon Holdings Limited (BRHL).
BRHL holds 100% equity of foreign subsidiaries BRFL Europe B.V.,
Netherlands & BRFL Italia S.r.l., Italy.
BRHL has registered a net profit of Rs. 2.28 crores for the year ended
March 31, 2012.
(ii) DPJ Clothing Limited, U.K.
DPJ Clothing Limited is engaged in business of wholesale marketing and
distribution of clothing Products. The said subsidiary is assisting in
getting many mid size retailers of Europe by providing the services
either by direct import or by import and delivery basis. Your Company
continued to reap benefits in expanding its business in Europe.
DPJ Clothing Ltd has registered loss of GBP 221,000 for the year ended
March 31, 2012.
(iii) BRFL Europe B.V., Netherlands.
BRFL Europe B.V. at Netherlands curtailed its operations to save costs
and most of the larger customers are directly dealt from well
established service facilities from India offices.
BRFL Europe B.V. has registered a loss of Euro 10,716 for the year
ended March 31, 2012.
(iv) BRFL Italia S.r.l, Italy.
The Company owns the popular GURU brand and is into the business
of retailing of readymade garments as well as other accessories in
Europe.
The economic environment in that part of world is gloomy and to keep
the business operations fit, the activities are restructured.
BRFL Italia S.r.l, Italy has registered a net loss of Euro 6.09 million
for the year ended March 31, 2012.
(v) STI India Limited (STI).
The Company is running the unit of STI on job work basis for the
manufacturing of yarn and knitted fabric. The part of manufactured
yarn is used for in-house consumption and balance is sold.
STI has registered a net profit of Rs. 15.18 lacs ended March 31, 2012.
(vi) BRFL Bangladesh Private Limited (BRFL Bangladesh).
The Company has been incorporated but operations yet to commence.
In accordance with general circular issued by the Ministry of Corporate
Affairs, Government of India, the Balance Sheet, Profit and Loss
Account and other documents of the subsidiary companies are not being
attached with the Balance Sheet of the Company. The Company will make
available the Annual Accounts of the Subsidiary Companies and the
related detailed information to any member of the Company and the
Subsidiaries who may be interested in obtaining the same.
The necessary disclosures are made in respect of the subsidiaries in
this Annual Report alongwith the statement pursuant to Section 212 of
the Companies Act, 1956.
Ds required by Section 212 of the Companies Act, 1956, the Statement of
holding in subsidiaries and Consolidated Accounts pursuant to
Accounting Standard (AS 21) issued by the Institute of Chartered
Accountant of India, including the financial accounts of the subsidiary
companies are forming part of the Annual Report. The Annual Accounts of
the subsidiary companies will also be kept open for inspection at the
Registered Office of the Company and that of the respective subsidiary
companies.
ACKNOWLEDGEMENTS:
Your Directors express sincere appreciations for the co- operation and
support from our Bankers, Securities and Exchange Board of India
("SEBI"), Stock Exchanges and other Regulatory authorities, State
Government and Central Government and above all, our Customers.
We look forward to receiving their continued support and encouragement.
The Board of Directors express its gratitude and record its sincere
appreciation of the dedicated efforts and commitment of all the
employees. The directors are thankful to the esteemed shareholders for
their support and the confidence reposed in the Company.
For and on behalf of the Board
Place: Mumbai Janardan Agrawal
Date: July 06, 2012 Chairman
Mar 31, 2011
Dear Shareholders,
The Directors have great pleasure to present their Report together
with the Audited Accounts for the year ended March 31, 2011.
FINANCIAL RESULTS AND OPERATIONS:
(Rs. in Lacs)
31-03-2011 31-03-2010
Sales 225483.63 161476.59
Profit before Interest, Depreciation
and Tax 56435.48 40317.86
Less: Interest 14520.64 9354.37
Profit before Depreciation and Tax 41914.84 30963.49
Less: Depreciation 13667.05 6806.53
Profit before Tax 28247.79 24156.96
Less: Provision for Taxes (including
Deferred) 5577.89 6565.05
Profit after Tax 22669.90 17591.91
Add: - Balance brought forward 44493.67 29765.52
- Profit available for appropriations 67163.57 47357.43
APPROPRIATIONS:
Less: - Transfer to General Reserve 1200.00 900.00
- Proposed Dividend 1981.50 1678.50
- Corporate Dividend Tax 329.10 285.26
- Balance Carried forward 63652.97 44493.67
Eps(Rs.)
- Basic 19.06 18.90
- Diluted 17.70 187.59
Your Company has achieved commencement of its largest fabric processing
plant at Tarapur and other facilities during the FY 2010-11. The
production is gearing up resulting into increase in topline by 8.63%
and PAT by 5.41%
During the year under review, the export turnover has increased to Rs.
109465.00 lacs as compared to Rs. 100410.21 lacs of the previous year.
DIVIDEND:
Your Directors recommend a dividend of Rs. 1.50/- per Equity Share
(15%) aggregating to Rs. 2310.60 lacs (including Corporate Dividend
Tax) for the financial year 2010-11, subject to the approval of the
members at the ensuing Annual General Meeting.
The dividend pay out as proposed is in accordance with the Company's
policy to pay sustainable dividend linked to the long term performance,
keeping in view the capital needs for the Company's growth plans and
the intent to optimal financing of such plans through internal
accruals.
SHARE CAPITAL:
During the year, the Authorised Share Capital of the Company has
increased from Rs. 1200000000 consisting of 12,00,00,000 equity shares
of Rs. 10 /- each to Rs. 1500000000 consisting of 15,00,00,000 equity
shares of Rs. 10/-each.
Your Company has raised equity by -
(i) Issue of 1,60,00,000 Global Depository Receipts (GDR) representing
equivalent number of underlying equity shares at the rate of US $ 6.60
per GDR (Rs. 292.69/- per GDR of face value of Rs. 10/-) to the persons
resident outside India raising an aggregate of US $ 105.600 million (
Rs. 46,830.72 lacs). Pursuant to aforesaid, the Company's GDRs have
been listed on the Singapore Stock Exchange with effect from October
27, 2010.
(ii) Issue and allotment of 1,00,00,000 Optionally Convertible
Warrants, each warrant convertible into one equity share at the rate of
Rs. 263/- per share (face value of Rs. 10/-) to B R Machine Tools
Private Limited, an entity belonging to the promoter/ promoter group of
the Company.
BUSINESS DEVLOPMENT:
1. Expansion of Yarn Dyeing, Weaving, Processing & Garmenting
capacities:
During the year under review, your Company has successfully commenced
the commercial production of its expansion project:
- Under Phase V consisting of manufacturing facilities of Processing,
Knit Processing at Tarapur and setting up of balancing machineries for
increasing efficiency of garmenting at Bangalore.
- Under Phase VA consisting of Yarn Dyeing at Tarapur.
The fabric weaving facilities are under erection and likely to be
operational by the second quarter of FY 2011 -12
Facilities Contemplated increase Location Phase
Weaving 380 Looms Islampur V
Weaving 356 Looms Tarapur VA
The cost of the project is funded partly by equity capital already
raised and the balance by way of term loans under Technology
Upgradation Fund Scheme (TUFs) entitling the Company an interest
subsidy of 5% and in addition capital subsidy of 10% on :he total
investment in Processing & Garment Machineries.
2. Cotton Yam Spinning: (Backward Integration of Business):
During the year, your Company acquired 70.56% stake in Indore based
Textile Company STI India Limited (STI), by acquiring the Equity Shares
and Optionally Convertible Debentures alongwith underlying securities
from the Overseas Private Investors for the total consideration of Rs.
70 crores. The said acquisition had triggered Open Offer to the
existing shareholders of STI. Your Company has acquired 2,13,79,722
equity shares in the Open Offer raising the holding to 73.72% equity
stake in STI. The equity shares of STI are listed on the BSE and the
NSE.
STI has the business of manufacturing Cotton Yarn and Cotton knitted
Fabrics and with a set up of 68,016 spindles and 16 knitting machines.
The plant has been operating at high capacity utilization. This
acquisition has helped the Company to complete the value chain from
spinning to garmenting.
3. Setting up of Subsidiary in Bangladesh:
In FY 2009-10, your Company has set up a liaison office in Bangladesh
to have added capabilities for more Garment business in International
Market. To expand the operations further, during the current financial
year your Company has incorporated it's wholly-owned subsidiary in the
name of BRFL Bangladesh Private Limited with the paid - up capital of
Tk 1,00,000 / -. (approxRs. 61, 240/-)
DIRECTORS:
Mr. A. Arumugham resigned as a Director of the Company with the effect
from February 9, 2011. The Directors place on record their appreciation
for the contributions made by Mr. A. Arumugham during his tenure.
Mr. M. M. Agrawal was appointed as an additional director during the
year. Mr. M. M. Agrawal is B.E. & CAIIB - Part 1 and adviser to Axis
Bank Ltd. At present he worked at various positions with AXIS Bank Ltd.
and retired as Deputy Managing Director. He has earlier worked as Chief
Manager - Credit in State Bank of Bikaner & Jaipur. His areas of
interest are private equity, strategy, Corporate Governance, Corporate
Finance & Corporate Social Responsibilities.
His experience would be of immense benefit to your Company and adds a
valuable perspective in the Board of Directors. Mr. M. M. Agrawal
holds the office till the date of the ensuing Annual General Meeting
(AGM) of the Company. The Company has received a notice from a member
of the Company proposing his candidature for appointment as a Director.
In accordance with the provisions of the Companies Act, 1956 and the
Company's Articles of Association, Mr. Janardan Agrawal, Mr. Naseer
Ahmed and Mr. A. R. Mundra, Directors of the Company shall retire by
rotation at the forthcoming Annual General Meeting and being eligible,
offer themselves for re-appointment.
CORPORATE GOVERNANCE:
A report on the Corporate Governance as stipulated under clause 49 of
the Listing Agreement with the Stock Exchanges along with a certificate
from the Statutory Auditors confirming compliance is set out in the
annexure forming part of this Report along with a separate annexure
giving the details of the Management Discussion and Analysis.
AUDITORS:
M/s V. K. Beswal & Associates, Chartered Accountants, having Firm
Registration Number 101083W, the Statutory Auditors of the Company
shall retire at the ensuing Annual General Meeting and being eligible,
offer themselves for re-appointment. Necessary resolution in this
regard is proposed at the forthcoming Annual General Meeting.
AUDITORS' REPORT:
There are no specific observation in the Auditors' Report requiring
further comments under section 217 (3) of the Companies Act, 1956.
FIXED DEPOSITS:
The Company has not accepted or renewed any deposit from public during
the year under review.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
confirm the following:
1. In the preparation of the annual accounts, the applicable
accounting standards have been followed and that there are no material
departures.
2. They have selected such accounting policies in consultation with
Statutory Auditors and other Experts and applied them consistently and
made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company at the
end of the financial year viz March 31, 2011 and of the Profit of the
Company for that year.
3. They have taken proper and sufficient care to the best of their
knowledge and ability for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities.
4. They have prepared the attached Statement of Accounts for the year
ended March 31, 2011 on a going concern basis.
PARTICULARS OF EMPLOYEES:
The information required under section 217 (2A) of the Companies Act,
1956 read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the names and the other particulars of the employees are set
out in the annexure to the Directors' Report. Having regard to section
219 (1) (b) (iv) of the said Act, Annual Report excluding the aforesaid
information is being sent to all the members of the Company and other
entitled therto. Any member interested in obtaining such particulars
may write to the Company Secretary at the registered office of the
Company.
CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY
ABSORPTION, FOREIGN
EXCHANGE EARNINGS AND OUTGO;
The particulars as prescribed under section 217 (1) (e) of the
Companies Act, 1956, read with the Companies (Disclosure of Particulars
in the Report of the Board of Directors) Rules, 1988, are set out in
annexure to this report.
SUBSIDIARY COMPANIES:
(i) Bombay Rayon Holdings Limited (BRHL).
BRHL holds 100% equity of foreign subsidiaries BRFL Europe B.V.,
Netherlands & BRFL Italia S.r.L, Italy. BRHL has registered a net
profit of Rs. 92.07 lacs for the year ended March 31, 2011.
(ii) DPJ Clothing Ltd, U.K.
DPJ Clothing Limited is engaged in business of wholesale marketing and
distribution of clothing Products. The said subsidiary is assisting in
getting many mid size retailers of Europe by providing the services
either by direct import or by import and delivery basis. Your Company
continued to reap benefits in expanding its business in Europe.
DPJ Clothing Ltd has registered a net profit of Rs. 199.61 lacs for the
year ended March 31, 2011.
(iii) BRFL Europe B.V., Netherlands.
BRFL Europe B.V at Netherlands continued to play an important role for
canvassing the business, services to customers on products and designs.
BRFL Europe B.V. has registered a loss of Rs. 49.95 lacs for the year
ended March 31, 2011.
(iv) BRFL Italia S.r.l, Italy.
The Company owns the popular 'GURU' brand and is into the business of
retailing of readymade garments as well as other accessories in Europe.
BRFL Italia S.r.l, Italy has registered a net loss of Rs. 4455.11 lacs
for the year ended March 31, 2011.
(v) STI India Limited (STI).
After acquiring majority stake in STI, your Company has run the
business for 4 months and for the year ended March 31, 2011, STI has
registered a net profit of Rs. 1690.66 lacs ended March 31, 2011.
(vi) BRFL Bangladesh Private Limited (BRFL Bangladesh).
The Company has been incorporated but operations yet to commence.
In accordance with general circular issued by the Ministry of Corporate
Affairs, Government of India, the Balance Sheet, Profit and Loss
Account and other documents of the subsidiary companies are not being
attached with the Balance Sheet of the Company. The Company will make
available the Annual Accounts of the subsidiary companies and the
related detailed information to aiy member of the Company who may be
interested in obtaining the same.
The necessary disclosures are made in respect of the subsidiaries in
this Annual Report alongwith the statement pursuant to Section 212 of
the Companies Act, 1956.
As required by Section 212 of the Companies Act, 1956, the Statement of
holding in subsidiaries and Consolidated Accounts pursuant to
Accounting Standard (AS 21) issued by the Institute of Chartered
Accountant of India, including the financial accounts of the subsidiary
companies are forming part of the Annual Report. The Annual Accounts of
the subsidiary companies will also be kept open for inspection at the
Registered Office of the Company and that of the respective subsidiary
companies.
ACKNOWLEDGEMENTS:
Your Directors express sincere appreciations for the co-operation and
support from our Bankers, Securities and Exchange Board of Indi a
("SEBI"), Stock Exchanges and other Regulatory authorities, State
Government and Central Government and above all our Customer;. We look
forward to receiving their continued support and encouragement.
The Board of Directors express its gratitude and record its sincere
appreciation of the dedicated efforts and commitment of all the
employees. The directors are thankful to the esteemed shareholders for
their support and the confidence reposed in the Company.
For and on behalf of the Board
Place: Mumbai Janardan Agrawal
Date: June 04, 2011 Chairman
Mar 31, 2010
The Directors have great pleasure to present their Report together
with the Audited Accounts for the year ended March 31, 2010.
Financial Results:
(Rs. 000)
31-03-2010 31-03-2009
Sales 161476.59 134240.03
Profit before Interest, Depreciation
and Tax 40317.86 32607.41
Less: Interest 9354.37 6596.29
Profit before Depreciation and Tax 30963.49 26011.12
Less: Depreciation 6806.53 4477.47
Profit before Tax 24156.96 21533.65
Less: Provision for Taxes
(including Deferred) 6565.05 6683.81
Profit after Tax 17591.91 14849.84
Add: - Balance brought forward 29765.52 16747.16
- Profit available for appropriations 47357.43 31597.00
APPROPRIATIONS:
Add: - Transfer on Amalgamation - 604.11
Less: - Transfer to General Reserve 900.00 800.00
- Additional provision for dividend - 91.50
- Corporate Dividend Tax on Additional
Dividend - 15.55
- Proposed Dividend 1678.50 1306.50
- Corporate Dividend Tax 285.26 222.04
- Balance Carried forward 44493.67 29765.52
EPS (Rs.)
-Basic 18.90 21.89
-Diluted 18.59 17.30
Result of Operations
During the year under review, your Company has recorded the turnover of
Rs. 161476.59 lacs against Rs. 134240.03 lacs in the previous year, an
increase of 1.20 times. The export turnover had a quantum jump to Rs.
100410.21 lacs from R. 87369.43 lacs. The Profit After Tax (PAT) for
the year increased from Rs. 14849.84 lacs to Rs. 17591.91 lacs, a
growth of 1.18 times over the previous financial year.
Dividend
Your Directors recommend a dividend of Rs. 1.50 per Equity Share (15%)
aggregating to Rs. 19,63,76,108/- (including Corporate
Dividend Tax) for the financial year 2009-10, subject to the approval
of the members at the ensuing Annual General Meeting.
The dividend pay out as proposed is in accordance with the Companys
policy to pay sustainable dividend linked to long term performance,
keeping in view the capital needs for the Companys growth plans and
the intent to optimal financing of such plans through internal
accruals.
Share Capital
During the financial year under review, the Company raised equity funds
by various modes as mentioned hereinbelow:
i) Issue of Equity Shares on preferential basis :
Your Company has made an allotment of 1,80,00,000 Equity Shares of Rs.
10/- each at a premium of 1175/- each aggregating to Rs. 333 crores, on
preferential allotment basis to AAA United B.V., a Company incorporated
under the laws of The Netherlands. The said investor is a wholly owned
subsidiary of Aktieselskabet af 1/8 2004, a company constituted under
the laws of Denmark which is primarily engaged in the business of trade
& investment and has a direct and/ or indirect stake in several
companies including in Bestseller A/S, which are primarily engaged in
the business of designing, developing, selling and marketing of
clothing products.
ii) Issue of Warrants and conversion thereof
Your Company has made an allotment of 1,00,00,000 Optionally
Convertible Warrants at the rate of Rs. 193/- per share to Reynold
Shirting Limited, an entity belonging to promoter/ promoter group of
the Company. Pursuant to the option for conversion of equity shares
exercised by the aforesaid promoter group entity, the Company has
allotted 58,00,000 Equity Shares in first tranche.
iii) Issue of Global Depository Receipts (GDR)
Your Company has raised an aggregate of US $ 97.09 million (equivalent
to Rs. 451,67,72,210/-) by issue of 1,90,00,000 Global Depository
Receipts (GDRs) representing equivalent number of underlying equity
shares at the rate of US $ 5.11 per GDR to the persons resident outside
India. Pursuant to aforesaid, the Companys GDR have been listed on the
Singapore Stock Exchange with effect from November 25, 2009.
As on March 31,2010, the paid - up capital of the Company stands
increased to Rs. 111.90 crores divided into 11,19,00,000 equity shares
of the face value Rs.10/- each.
Business Expansions
Expansion of Yarn Dyeing, Weaving, Processing & Garmenting capacities:
During the year under review, your Company has successfully commenced
the commercial production of its Phase III & IV expansion projects of
manufacturing facilities of yarn dyeing, weaving, processing &
garmenting at various locations in the State of Maharashtra
Further expansion of Processing & Weaving:
After completion of all Phases till IV, the Company has undertaken the
new expansion projects in Phase V for expanding its manufacturing
facilities of -
Facilities Contemplated
increase Location
Fabric Processing 1,40,000 mtrs
per day Tarapur
Knit Processing 12 MT per day Tarapur
Weaving 380 Looms Islampur
Weaving 356 Looms Tarapur
Yarn Dyeing 25 Tons per day Tarapur
In addition, the Company has undertaken steps for import of balancing
equipments of garment manufacturing for increasing the efficiency of
existing facilities at Doddaballapur.
The aforesaid facilities are expected to be commissioned by fourth
quarter of the current financial year.
The cost of the project shall be financed partly by equity already
raised by issue of shares on preferential basis and balance by way of
term loans under Technology Upgradation Fund Scheme (TUFs) entitling
the company an interest subsidy of 5% and in addition capital subsidy
of 10% on total investment in Processing & Garment Machineries.
Directors
Mr. K. Muthukumaran, Chief General Manager of Export - Import Bank of
India (EXIM Bank) has been appointed as a Nominee Director of EXIM Bank
on the Board of the Company in place of Mr. John Mathew, Chief General
Manager of EXIM Bank w.e.f. October 30, 2009.
In accordance with the provisions of the Companies Act, 1956 and the
Companys Articles of Association, Mr. Suresh Vishwasrao, Mr. A.
Arumugham and Dr. Pravin P. Shah, Directors of the Company shall retire
by rotation at the forthcoming Annual General Meeting and being
eligible, offer themselves for re-appointment.
Corporate Governance
A report on the Corporate Governance as stipulated under clause 49 of
the Listing Agreement with the Stock Exchanges along with a certificate
from the Statutory Auditors confirming compliance is set out in the
annexure forming part of this Report along with a separate annexure
giving the details of the Management Discussion and Analysis.
Auditors
M/s V K. Beswal & Associates, Chartered Accountants, having Firm
Registration Number 101083W the Statutory Auditors of the Company shall
retire at the ensuing Annual General Meeting and being eligible, offer
themselves for re-appointment.
Necessary resolution in this regard is proposed at the forthcoming
Annual General Meeting.
Auditors Report
There are no specific observation in the Auditors Report requiring
further comments under Section 217 (3) of the Companies Act, 1956.
Fixed Deposits
The Company has not accepted or renewed any deposit from public during
the year under review.
Directors Responsibility Statement:
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
confirm the following:
1. In the preparation of the annual accounts, the applicable
accounting standards have been followed and that there are no material
departures.
2. They have selected such accounting policies in consultation with
Statutory Auditors and other Experts and applied them consistently and
made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company at the
end of the financial year viz March 31, 2010 and of the Profit of the
Company for that year.
3. They have taken proper and sufficient care to the best of their
knowledge and ability for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities.
4. They have prepared the attached Statement of Accounts for the year
ended March 31, 2010 on a going concern basis.
Particulars Of Employees
As required by the provisions of Section 217 (2A) of the Companies Act,
1956 read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the names and other particulars of employees are set out in
the annexure to this report. However, as per the provisions of Section
219(1)(b)(iv) of the said Act, the annual report and accounts are being
sent to all members of the Company excluding the aforesaid information.
Any member interested in obtaining such particulars may write to the
Company at its Registered Office.
Conservation of Energy, Research and Development, Technology
Absorption, Foreign Exchange Earnings and Outgo:
The particulars as prescribed under Section 217 (1) (e) of the
Companies Act, 1956, read with the Companies (Disclosure of Particulars
in the Report of the Board of Directors) Rules, 1988, are set out in
annexure to this report.
Subsidiary Companies:
(i) Bombay Rayon Holdings Limited (BRHL)
BRHL holds 100% equity of BRFL Europe B.V., Netherlands & BRFL Italia
S.r.l., Italy.
BRHL has registered a net loss of Rs. 62.55 lacs for the year ended
March 31, 2010.
(ii) DPJ Clothing Ltd., U.K.
DPJ Clothing Limited is engaged in business of wholesale marketing and
distribution of clothing Products. The said subsidiary is assisting in
getting many mid size retailers of Europe by providing the services
either by direct import or by import and delivery basis. Your Company
continued to reap benefits in expanding its business in Europe.
DPJ Clothing Ltd. has registered a net profit of ã 4,23,955 for the
year ended March 31, 2010.
(iii) BRFL Europe B.V., Netherlands
BRFL Europe B.V. at Netherlands continued to play an important role for
canvassing the business, services to customers on products and designs.
BRFL Europe B.V. has registered a net profit of à 5,75,034 for the year
ended March 31, 2010.
(iv) BRFL Italia S.r.l, Italy
The Company owns the popular GURU brand and is into the business of
retailing of readymade garments as well as other accessories in Europe.
BRFL Italia S.r.l, Italy has registered a net loss of à 19,54,388 for
the year ended March 31, 2010.
The Government of India, Ministry of Corporate Affairs, vide its letter
dated March 19, 2010 granted its approval under Section 212(8) of the
Companies Act, 1956, exempting the Company from attaching the full text
of the financial statements of the subsidiaries of the Company.
In accordance with the requirements of the said approval, necessary
disclosures are made in respect of the subsidiaries
in this Annual Report alongwith the statement pursuant to Section 212
of the Companies Act, 1956.
Any shareholder who wishes to have a copy of the annual accounts and
detailed information about the subsidiary company may write to the
subsidiary company and/or the Company for the same. The annual accounts
of the subsidiary companies will also be kept for inspection by any
member at the Registered Offices of the Company and its subsidiaries.
As required by Section 212 of the Companies Act, 1956, the Statement of
holding in subsidiaries and Consolidated Accounts pursuant to
Accounting Standard (AS 21) issued by the Institute of Chartered
Accountant of India, including the financial accounts of the subsidiary
companies are forming part of the Annual Report.
Acknowledgements
Your Directors are grateful for the co-operation and support from our
Bankers, Securities and Exchange Board of India ("SEBI"), Stock
Exchanges and other Regulatory Authorities, State Government and
Central Government and above all our Customers. We look forward to
receiving their continued support and encouragement. The Board of
Directors wishes to express its gratitude and record its sincere
appreciation of the dedicated efforts and commitment of all the
employees. The directors are thankful to the esteemed shareholders for
their support and the confidence reposed in the company.
For and on behalf of the Board
Place: Mumbai Janardan Agrawal
Date: May 18, 2010 Chairman