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Directors Report of C Mahendra Ltd.

Mar 31, 2015

Dear Members,

The Directors are pleased to present the 9th Annual Report and the Audited Annual Accounts for the financial year ended 31st March, 2015.

FINANCIAL RESULTS

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

(Rs. in Million)

Particulars For the F.Y. For the F.Y. ended 31st ended 31st March, 2015 March, 2014

Income from Operation:

Net Sales 5835.09 20148.30

Other Income 380.51 93.05

Total income from

operations 6215.60 20241.34

Profit before Tax -1334.95 93.26

Less: Current Tax - (18.00)

Mat Credit Entitlement - 18.00

Deferred Tax -4.61 16.61

Wealth Tax 0 0

Less: Prior period - -17.41 income tax adjustment

Profit after Tax -1339.56 59.23

Add: Profit brought 1928.89 1869.66 forward

Amount Available for 589.33 1928.89 Appropriation

Appropriation: -

Utilized for bonus -

shares issued during the

year

Balance Carried to 589.33 1928.89 Balance Sheet

REVIEW OF OPERATIONS

During the year under review, the Company's net sales were Rs. 5835.09 million as against Rs. 20148.30 million.

Your Directors are continuously looking for lucrative ventures for future growth of the Company.

BACKGROUND OF C. MAHENDRA GROUP

C. Mahendra Exports Ltd, a renowned and trusted name since 1974, is one of the leading diamantaire and jewellery Company with a wide spread around the world.

The pioneers of the Company, Mr. Mahendra C. Shah and Mr. Champak K. Mehta commenced the business in 1974. C. Mahendra Exports was formed in the year 1978 to carry on the business of manufacturing and trading of diamonds. It is the flagship company of our CM Group. C. Mahendra Exports set up its first state of the art factory for manufacturing cut and polished diamonds in Surat, India in the year 1993. Subsequently three subsidiaries were established to handle the expanded business.

Offices were opened outside India for effective and increased marketing. In2003 Ciemme Jewels incorporated, in 2006, C. Mahendra Exports commissioned the second state of the art manufacturing factory at Varachha Road, Surat, India to manufacture large size polished diamonds, In Jan, 2007, C. Mahendra Exports converted from Partnership Firm into a private company and March, 2007 changed from Private Company to Public Limited Company i.e. C. Mahendra Exports Ltd.

C. Mahendra Exports Ltd. employs the latest and most advanced technologies for manufacturing of cut and polished diamonds with ultimate brilliance diamonds. CM Group has a highly skilled pool of human resources.

C. Mahendra Exports Ltd. has its Registered and Principal Sales Office in Mumbai from where all the marketing, assorting, administration and finance operations are controlled. The entire operation for manufacturing is controlled and managed from the Surat office. CM Group is firmly established across major diamonds and jewellery centers globally in 5 countries namely.

* China - Hong Kong

* India - Mumbai

* UAE - Dubai

* Belgium - Antwerpen

* U.S.A - New York

C. Mahendra Exports Ltd. enjoys an envious position in the diamond industry of being one of the top exporters with an unblemished client record. C. Mahendra Exports Ltd. has its presence in the diamond studded jewellery business. Our branded jewellery is retailed under the brand name "Ciemme" across the world.

C. Mahendra BVBA, the Antwerp based entity of the C. Mahendra Group is a member of the Responsible Jewellery Council (RJC).The management of C. Mahendra B.VB.A., as a member of the Responsible Jewellery Council (RJC) is committed to complying with the Code of Practices of RJC.

PRINCIPAL ACTIVITIES

Diamond Manufacturing Facilities -

The Company set up its first factory for diamond production at Udhana, in 1993. The Company established second diamond cutting and polishing factory in Varachha in 2006 (100 % EOU) but now EOU status has been expired and established a unit in SEZ.

Green Energy Division (Wind Energy) -

The Company started the activities related to its Green Energy Division, by setting up Wind farm businesses at Sangli, Maharashtra in 2006 and Kutch, Gujarat in 2007.

The company has invested Rs. 68 Crores in the Green Energy in the state of Maharashtra and Gujarat. In the year 2005-06, the Company has installed eight Wind Turbine Generators (WTGs) each of 1.25 MW, total having 10 MW in the state of Maharashtra for sale of energy to MSEDCL. Further, in the year 2007-08, company has installed two Wind Turbine Generators (WTGs) each of 1.50 MW, total having 3.00 MW in the state of Gujarat for the captive consumption (Wheeling) for its units at, Udhana & Varachha in Surat.

SUBSIDIARY COMPANIES

The Company has various domestic and international subsidiaries and step-down subsidiaries:

1) C. Mahendra International Limited

2) C. Mahendra BVBA, Antwerp (Belgium),

3) C. Mahendra DMCC Dubai UAE,

4) C. Mahendra International Limited, Mauritius,

5) International Gems and Jewellery FZE,

6) AL DASPA Gems and Jewellery FZE,

7) Ciemme Jewels Limited

8) C. Mahendra USA Inc.,

9) C. Mahendra Exports (HK) Limited,

CONSOLIDATED FINANCIAL STATEMENTS

As the audit of the International Subsidiaries of the Company has not been completed, hence, the Consolidated Financial Statements are not annexed.

CHANGE IN THE NATURE OF BUSINESS, IF ANY

During the year, there was no change in the nature of business.

FINANCE

The Company is availing Working Capital requirements from the Consortium of 14 Bankers and has obtained adequate finance during the year under review. The debt is secured by immovable properties, current assets and others. The banks have classified the loans given to the Company as NPA.

DIVIDEND

Due to losses during the year under review, the directors regret their inability to declare any dividend for the year under review.

SHARE CAPITAL

ISSUE OF SHARES ON CONVERSION OF SHARE WARRANTS

Bennett, Coleman & Co. Ltd have opted to convert the share warrant issued in their favour into 5,67,780 fully paid up equity shares. The same were converted, allotted and listed on the stock exchanges.

ISSUE OF BONUS SHARES

Further, the Company declared Bonus Shares in the ratio 1:1 to the Equity Shareholders of the Company. The Bonus shares allotted to the promoters are yet to be listed on the stock exchanges. Exchange have imposed penalty for delay in compliance of Clause 41 of the Listing Agreement.

LISTING ON STOCK EXCHANGES

The Shares of the Company continue to be listed on BSE Limited and National Stock Exchange of India Limited both having nationwide terminals.

The shares of the Company have been delisted from MCX-SX.

FIXED DEPOSITS

The Company has not accepted any public deposits

during Fiscal 2015.

DIRECTORS APPOINTMENT

1. Ms. Bindya Vasani (DIN: 03636726) and Mr. Diwakar Singh (DIN: 07255277) were appointed as Non-Executive Independent Directors of the Company. Ms. Bindya Vasani is also the Women Director of the Company, pursuant to clause 49 (II) (A) (1) of Listing agreement and Section 149 of the Companies Act, 2013 w.e.f. 20th June, 2015.

The Company has received Notices in writing from a Member alongwith requisite deposits of money proposing the aforesaid two directors to the office of Directors under the Section 160 of the Companies Act, 2013.

The Board recommends their appointment as Independent Directors of the Company, not liable to retire by rotation. Necessary resolutions for obtaining approval of the Members in respect of the above appointments have been incorporated accompanying notice of Annual General Meeting.

2. Appointed Mr. Chetan N. Bafna (06968721) as Non-Executive Independent director of the company w.e.f. 13th November, 2014.

3. Appointed Mr. Swapnil T. Dafle as the Company Secretary and Compliance officer (Key Managerial Personnel of the Company), w.e.f. 7th May, 2014.

4. Resignation of Mr. Kailashchandra C. Chaudhary, Non-Executive Independent director, from the directorship of the Company w.e.f. 8th June, 2014 and the same accepted by the board.

5. Resignation of Mr. Sandeep M. Shah, Whole time director from the directorship of the Company w.e.f. 29th December, 2014 and the same accepted by the board.

6. Resignation of Mr. Vittala. S. Hegde, Non-Executive Independent director, from the directorship of the Company w.e.f. 18th September, 2014 and the same accepted by the board.

7. Resignation of Mr. Ashish Kumar Shrivastava, Company Secretary and Compliance officer (KMP) from the Company w.e.f 31st March, 2014 and the same accepted by the board.

ROTATION

No Directors are liable to retire by rotation in the ensuing Annual General Meeting.

INSURANCE

The Properties and Assets of the Company are adequately insured.

PUBLIC DEPOSITS

During the year, the Company has not accepted any deposit.

RELATED PARTY TRANSACTIONS

All contracts/ arrangements/ transactions entered by the Company during the financial year with related parties were on an arm's length basis, in the ordinary course of business and were in compliance with the Section 188 of the Companies Act, 2013 read with Rule 15 of Companies (Meeting of Board and its Powers) Rules, 2014 and the Clause 49 of the Listing Agreement. There are no materially significant Related Party Transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

A statement of all Related Party Transactions is placed before the Audit Committee for its review

The Company has adopted a Related Party Transactions Policy and is uploaded on the Company's website There have been no materially significant related party transactions between the Company and Directors, the management, subsidiaries or relatives.

During the Fiscal 2015 there are no material transactions between the Company and the related parties as defined under Clause 49 of the Listing Agreement. Further, all transactions with related parties have been conducted at an arm's length basis and are in ordinary course of business. Accordingly there are transactions that are required to be reported in Form AOC-2 and as such form annexure I in Director's Report.

PARTICULARS OF EMPLOYEES

The Company does not have any employee/Director who is in receipt of remuneration aggregating to the sum prescribed in Section 197 of the Companies Act, 2013 ("the Act") read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

The required disclosures with respect to Remuneration and other details are set out in Annexure - II to this Report. HUMAN RESOURCES

The relations between the management and the employees generally remained cordial in the year under review. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY

The details of Loans, Guarantees or Investments made during the year are given below:

Sr. Companies Nature of Loans Guarantees Investments No. Transaction

1 C. Mahendra International Investment - - 20128000 Limited Capital

2 C. Mahendra BVBA Investment - - 616896799 Capital

3 C. Mahendra DMCC Investment - - 2560920 Capital

4 Ciemme Jewels Limited Investment - - 384000000 Capital

5 C. Mahendra trading Investment - - 374301301 Capital

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Act, read along with Rule, 8 of the Companies (Accounts) Rules, 2014, is Annexed III

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134 of the Companies Act, 2013 the Directors state that:

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

b) Appropriate accounting policies have been selected and applied consistently and have 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, 2015 and of the profit and loss of the Company for the year ended March 31, 2015;

c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

e) Proper internal financial controls were followed by the Company and such internal financial controls are adequate and were operating effectively;

f) Proper systems are devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

BOARD MEETINGS

During the year under review, 12 (twelve) Board Meetings were convened and held. Details of the composition of the Board and its Committees and of the Meetings held and other relevant details are provided in the Corporate Governance Report.

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS

The Company's policy on Directors' appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in Corporate Governance Report, which forms part of Annual Report. AUDITORS Statutory Auditors

The Auditors M/s R. H. Modi & Co. Chartered Accountants (Firm Reg. No. 106486W), will retire at the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. Members are requested to consider their re-appointment on such remuneration as may be mutually agreed to between the Statutory Auditors and the Board.

Internal Auditors

M/s V. A. Parikh & Associates, Chartered Accountants and M/s NSM & Associates, Chartered Accountants are the internal auditors of the Company.

Cost Audit

M/s Nanty Shah & Associates, were the Cost Auditors of the Company. The Company has been exempted from Cost Audit is not applicable to the Company vide MCA Circular and since then the Cost Audit has been discontinued.

Secretarial Auditor

M/s H.S Associates, Practicing Company Secretaries were appointed as Secretarial Auditor to conduct the Secretarial Audit of the Company for the Financial Year 2014-2015 pursuant to section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The Secretarial Audit Report is attached as 'Annexure IV'. The Secretarial Auditors Report for the financial year 2014-15, does not contain any qualification, reservation or adverse remark.

VIGIL MEGHANISM/WHISTLE BLOWER POICY

The Company has adopted a Whistle Blower Policy establishing a Vigil Mechanism that enables the Directors and Employees to report genuine concerns. The Vigil Mechanism provides for (a) adequate safeguards against victimization of persons who use the Vigil Mechanism; and (b) direct access to the Chairperson of the Audit Committee of the Board of Directors of the Company in appropriate or exceptional cases. The policy is on the website of the Company.

CORPORATE SOCIAL RESPONSIBILITY The Board has constituted Corporate Social Responsibility (CSR) Committee under the Chairmanship of an Independent Director pursuant to the subsection (1) of Section 135 of Companies Act, 2013.

The CSR Committee has formulated CSR Policy of the Company which is available on Company's website -www.cmelgroup.com

The Company has incurred loss in the year under review and due to the company turning into NPA; the Company is yet to initiate its CSR activities

RISK MANAGEMENT

The Company has devised and implemented a mechanism for risk management and has developed a Risk Management Policy. The Policy provides for creating a Risk Register, identifying internal and external risks and implementing risk mitigation steps. The policy is on the website of the Company.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company proactively keeps its Directors informed of the activities of the Company, its management and operations and provides an overall industry perspective as well as issues being faced by the industry.

SEPARATE MEETING OF INDEPENDENT DIRECTORS

There was one separate meeting of Independent Directors held on Friday 27th March, 2015 and 2 (Two) Independent Directors were present i.e. Mr. Chetan Bafna (Chairman) and Mr. Prabodh N. Shah. In the Meeting the Independent Directors have reviewed the performance of the Chairman of the Company- Mr. Mahendra C. Shah and the performance of other Non Executive Directors and the Board as a whole. And assess the quality, quantity and timeliness of flow of information between the Company management. After review the Independent Directors were of the opinion that the performances of all company need to have more stronger to face the currant losses and commit to overcome in near future.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement the Company has adopted most of the provisions of Clause 49 of the Listing agreement. A report on Corporate Governance along with a certificate from the Secretarial Auditor of the Company regarding the compliance of conditions of Corporate Governance and also the Management Discussion and Analysis Report are annexed to this report.

DEPOSIT FROM PUBLIC

The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.

REMUNERATION POLICY

The Company has in place a Remuneration Policy for the Directors, Key Managerial Personnel and other employees, pursuant to the provisions of the Act and Clause 49 of the Listing Agreement, the same is annexed. Due to the ongoing losses and paucity of funds, the Promoter-Directors of the Company have foregone their salary.

DECLARATION BY INDEPENDENT DIRECTOR

Pursuant to Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Independent Directors of the Company have given the declaration to the Company that they qualify the criteria of independence as required under the Act.

BOARD EVALUATION

Pursuant to the provisions of Companies Act, 2013 and clause 49 of the Listing Agreement, the Board has carried out annual performance evaluation of its own performance, the directors individually as well the evaluation of the working of its Audit, Nomination & Remuneration and Stakeholder committee, including the Chairman of the Board who were evaluated on parameters such as level of engagement and contribution and independence of judgment thereby safeguarding the interest of the Company. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors. The Directors expressed their satisfaction with the evaluation process.

REPORT ON SEXUAL HARASSMENT IN THE FINANCIAL YEAR

In compliance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company had constituted an Internal Complaints Committee for prevention and redressal of complaints of sexual harassment against women. The Committee comprises of the following members:-

1. Ms. Kalpana D Thakkar (Presiding Officer - Senior Employee)

2. Mr. Sanjay M. Masugade (Member - Human Resources & Administration)

During the financial year, the Company has received NIL compliant

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is Annexure V herewith. COMMENT ON SECRETARIAL AUDITOR REPORT AND AUDITOR REPORT

Secretarial Auditor Report and Auditor Report is self explanatory.

ACKNOWLEDGEMENT

Your directors would like to place on record their deep sense of gratitude to the Shareholders, Banks, Financial Institutions, valued customers and business associates, and various other government/semi-government agencies for all the guidance, co-operation, support and encouragement extended by them to the company.

Your directors would also like to take this opportunity to gratefully appreciate the hard work and dedicated efforts put in by the employees and look forward to their continued contribution in future endeavors of the company.

For and On behalf of the Board of Directors

Sd/-

Date: 26/08/2015 (Mahendra C. Shah) Place: Mumbai Chairman


Mar 31, 2014

Dear members,

The Directors are pleased to present the 8th Annual Report and the Audited Annual Accounts for the financial year ended 31st March, 2014.

Financial Results

The financial performance of the Company, for the year ended 31st March, 2014 is summarized below:

(Rs. in Million) Particulars For the F. Y. For the F. Y. ended 31st ended 31st March, 2014 March, 2013

Income from Operation: Net Sales 20148.30 21017.02 Other Income 93.05 97.43 Total income from operations 20241.34 21114.45 Profit before Tax 93.26 288.01 Less: Current Tax (18.00) (57.05) Mat Credit Entitlement 18.00 57.05 Deferred Tax 16.61 22.78 Wealth Tax 0 0 Less: Prior period income tax adjustment -17.41 0.89 Profit after Tax 59.23 311.68 Add: Profit brought forward 1869.66 1584.13 Amount Available for Appropriation 1928.89 1895.81 Appropriation: Utilized for bonus shares issued during the year - - Balance Carried to Balance Sheet 1928.89 1895.81

Review of Operations:

During the year under review, the Company''s net sales are earned of Rs. 20148.30 million net sales as against Rs. 21017.02 million during the previous financial year, showing Decline by 4.14% compared to previous year.

Your Directors are continuously looking for avenues for future growth of the Company.

Background of C. Mahendra Group

C. Mahendra Exports Ltd, a renowned and trusted name since 1974, is one of the leading diamantaire and jewellery Company with a wide spread around the world.

The pioneers of the Company, Mr. Mahendra C. Shah and Mr. Champak K. Mehta commenced the business in 1974. C. Mahendra Exports was formed in the year 1978 to carry on the business of manufacturing and trading of diamonds. It is the flagship company of our CM Group. C. Mahendra Exports set up its first state of the art factory for manufacturing cut and polished diamonds in Surat, India in the year 1993. Subsequently three subsidiaries were established to handle the expanded business.

Offices were opened outside India for effective and increased marketing. In 2003 Ciemme Jewels incorporated, in 2006, C. Mahendra Exports commissioned the second state of the art manufacturing factory at Varachha Road, Surat, India to manufacture large size polished diamonds, In Jan, 2007, C. Mahendra Exports converted from Partnership Firm into a private company and March, 2007 changed from Private Company to Public Limited Company i.e. C. Mahendra Exports Ltd.

C. Mahendra Exports Ltd. employs the latest and most advanced technologies for manufacturing of cut and polished diamonds with ultimate brilliance diamonds. CM Group has a highly skilled pool of human resources.

C. Mahendra Exports Ltd. has its Registered and Principal Sales Office in Mumbai from where all the marketing, assorting, administration and finance operations are controlled. The entire operation for manufacturing is controlled and managed from the Surat office. CM Group is firmly established across major diamonds and jewellery centers globally in 5 countries namely.

* China - Hong Kong

* India - Mumbai

* UAE - Dubai

* Belgium - Antwerpen

* U.S.A - New York

C. Mahendra Exports Ltd. enjoys an envious position in the diamond industry of being one of the top exporters with an unblemished client record. C. Mahendra Exports Ltd. has its presence in the diamond studded jewellery business. Our branded jewellery is retailed under the brand name "Ciemme" across the world.

C. Mahendra BVBA, the Antwerp based entity of the C. Mahendra Group is a member of the Responsible Jewellery Council (RJC).The management of C. Mahendra B.VB.A., as a member of the Responsible Jewellery Council (RJC) is committed to complying with the Code of Practices of RJC.

Principal Activities

Diamond Manufacturing Facilities -

The Company set up its first factory for diamond production at Udhana, in 1993. The Company Established second diamond cutting and polishing factory in Varachha in 2006 (100 % EOU) but now EOU status has been expired and established a unit in SEZ.

Green Energy Division (Wind Energy) -

The Company started the activities related to its Green Energy Division, by setting up Wind farm businesses at Sangli, Maharashtra in 2006 and Kutch, Gujarat in 2007.

The company has invested Rs. 68 Crores in the Green Energy in the state of Maharashtra and Gujarat. In the year 2005-06, the Company has installed eight Wind Turbine Generators (WTGs) each of 1.25 MW, total having 10 MW in the state of Maharashtra for sale of energy to MSEDCL. Further, in the year 2007-08, company has installed two Wind Turbine Generators (WTGs) each of 1.50 MW, total having 3.00 MW in the state of Gujarat for the captive consumption (Wheeling) for its units at, Udhana & Varachha in Surat.

Subsidiary Companies

As required under Section 212 of the Companies Act, 1956, the Audited Statements of Accounts of subsidiary companies:

1) C. Mahendra International Limited

2) C. Mahendra BVBA, Antwerp (Belgium)

3) C. Mahendra DMCC Dubai United Arab Emirates.

Auditors'' Reports thereon for the year ended March 31, 2014 are annexed.

Consolidated Financial Statements

In accordance with the Accounting Standard 21, issued by The Institute of Chartered Accountants of India, your Directors have pleasure in attaching the Consolidated Financial Statements for the year ended March 31, 2014.

Finance

The Company is availing Working Capital requirements from the Consortium of 14 Bankers and has obtained adequate finance during the year under review. The debt is secured by immovable properties, current assets and others.

Dividend

The Board of Directors paid 1% interim dividend (Rs. 0.10 per Equity Share of Rs. 10 each) on 1,50,00,000 Equity Shares to the ''Non-Promoters Group'' absorbing a sum of Rs. 15,00,000/- as per the provisions of section 205 of the Companies Act, 1956 during the financial year ended 31st March, 2014.

It is also informed that the 1% interim dividend of Rs. 4,50,000/- on 4,50,00,000 Equity Shares belongs to "Promoter and Promoter Group" of the Company, is waived from the total amount of dividend on equity shares with their consent and provision of Articles of Association of the Company in this regard for the financial year ended 31.03.2014.

Directors

Appointment

Mr. V. S. Hegde (DIN : 01243655) and Mr. P. N. Shah (DIN : 05306765) are Non-Executive Directors on the Board of Directors (''the Board'') of the Company. With the enactment of the Companies Act, 2013 (''the Act''), it is now incumbent upon every listed company to have the requisite number of Independent Directors on the Board. The above Directors are being appointed as Independent Directors of the Company under the Act. The Company has received two separate Notices in writing from a Member along with requisite deposits of money proposing the aforesaid two directors to the office of Directors under the applicable provisions of the Act. The Board recommends the appointment of Mr. V. S. Hegde and Mr. P. N. Shah as Independent Directors of the Company, not liable to retire by rotation, to hold office for a term of four consecutive years commencing from 22nd September, 2014.

Necessary resolutions for obtaining approval of the Members in respect of the above appointments have been incorporated in the notice of the forthcoming Annual General Meeting.

Rotation

Mr. Sandeep M. Shah, the Executive Director of the Company retires at the forthcoming Annual General Meeting, and being eligible, offers himself for re- appointment. The Board recommends the re-appointment of Mr. Sandeep M. Shah at the ensuing AGM.

None of the Directors are disqualified from being appointed or holding office as Directors as stipulated under Section 274(1)(g) of the Companies Act, 1956.

Insurance

The Properties and Assets of the Company are adequately insured.

Particulars of Employees

The Company has no employees of the specified categories under section 217 (2A) of the Companies Act, 1956 read with Companies (particulars of employees) rules, 1975 as amended up to date.

Conservation of Energy, Technology Absorption

Information under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are given in Annexure I to this report.

Directors'' Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 Directors based on the representations received from the Operating Management, confirm:

(i) That in the preparation of the annual accounts for the financial year ended 31st March, 2014 the applicable accounting standards had been followed.

(ii) That the directors had selected such accounting policies and applied them Consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the company for the year.

(iii) That the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of The Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

(iv) That the directors had prepared the annual accounts for the financial year ended 31st March, 2014 on a going concern basis.

Disclosures under Section 217(1)(d) of the Companies Act, 1956

Except as disclosed elsewhere in this report, there have been no material changes and commitments which can affect the financial position of the Company occurred between the end of the financial year of the Company and date of this report.

Transfer to Reserves in terms of Section 217 (1)(b) of the Companies Act, 1956

For the financial year ended 31st March, 2014 the Company had transfer Rs. 59,230,551 to Reserves.

Statutory Auditors

The Auditors M/s R. H. Modi & Co. Chartered Accountants (Firm Reg. No. 106486W), Room No. 11, Singh House, 23, Ambalal Doshi Marg, 2nd Floor, Fountain, Mumbai - 400 023 will retire at the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. Members are requested to consider their re-appointment on such remuneration as may be mutually agreed to between the Statutory Auditors and the Board.

Acknowledgement

Your directors would like to place on record their deep sense of gratitude to the Shareholders, Banks, Financial Institutions, valued customers and business associates, and various other government/semi-government agencies for all the guidance, co-operation, support and encouragement extended by them to the company.

Your directors would also like to take this opportunity to gratefully appreciate the hard work and dedicated efforts put in by the employees and look forward to their continued contribution in future endeavors of the company.

For and On behalf of the Board of Directors

Sd/- Date : 30/05/2014 (Mahendra C. Shah) Place: Mumbai Chairman


Mar 31, 2013

To, The Members.

The Directors are pleased to present the 7th Annual Report and the Audited Annual Accounts for the financial year ended 31st March, 2013.

Financial Results

The financial performance of the Company, for the year ended 31st March, 2013 is summarized below:

(Rs in Million) Particulars For the For the F. Y. F. Y ended 31st ended 31st March, March, 2013 2012

Income from Operation:

Net Sales 21017.02 19480.55

Other Income 97.43 87.44

Total income from operations 21114.45 19567.99

Profit before Tax 288.01 410.65

Less: Current Tax (57.05) (41.00)

Mat Credit Entitlement 57.05 26.00

Deferred Tax 22.78 5.41

Wealth Tax 0 0

Less: Prior period income 0.89 (7.57) tax adjustment

Profit after Tax 311.68 393.49

Add: Profit brought forward 1584.13 1263.99

Amount Available for 1895.81 1657.48

Appropriation

Appropriation:

Utilized for bonus shares issued during the year

Balance Carried to Balance 1895.81 1657.48 Sheet

Review of Operations:

During the year under review, the Company''s net sales are earned of Rs. 21114.45 million net sales as against Rs. 19,567.99 million during the previous financial year, showing growth of 7.90% compared to previous year.

Your Directors are continuously looking for avenues for future growth of the Company.

Background of C. Mahendra Group

C. Mahendra Exports Ltd, a renowned and trusted name since 1974, is one of the leading diamantaire and jewellery Company with a wide spread around the world.

The pioneers of the Company, Mr. Mahendra C. Shah and Mr. Champak K. Mehta commenced the business in 1974. C. Mahendra Exports was formed in the year 1978 to carry on the business of manufacturing and trading of diamonds. It is the flagship company of our CM Group. C. Mahendra Exports set up its first state of the art factory for manufacturing cut and polished diamonds in Surat, India in the year 1993. Subsequently three subsidiaries were established to handle the expanded business.

Offices were opened outside India for effective and increased marketing. In 2003 Ciemme Jewels incorporated, in 2006, C. Mahendra Exports commissioned the second state of the art manufacturing factory at Varachha Road, Surat, India to manufacture large size polished diamonds, In Jan, 2007, C. Mahendra Exports converted from Partnership Firm into a private company and March, 2007 changed from Private Company to Public Limited Company i.e. C. Mahendra Exports Ltd.

C. Mahendra Exports Ltd. employs the latest and most advanced technologies for manufacturing of cut and polished diamonds with ultimate brilliance diamonds. CM Group has a highly skilled pool of human resources.

C. Mahendra Exports Ltd. has its Registered and Principal Sales Office in Mumbai from where all the marketing, assorting, administration and finance operations are controlled. The entire operation for manufacturing is controlled and managed from the Surat office. CM Group is firmly established across major diamonds and jewellery centers globally in 5 countries namely.

- China - Hong Kong

- India - Mumbai, Delhi

- UAE-Dubai

- Belgium - Antwerpen

- U.S. A- New York

C. Mahendra Exports Ltd. enjoys an envious position in the diamond industry of being one of the top exporters with an unblemished client record. C. Mahendra Exports Ltd. has its presence in the diamond studded jewellery business. Our branded jewellery is retailed under the brand name "Ciemme" across the world.

C. Mahendra BVBA, the Antwerp based entity of the C. Mahendra Group is a member of the Responsible Jewellery Council (RJC).The management of C. Mahendra B.V.B.A., as a member of the Responsible Jewellery Council (RJC) is committed to complying with the Code of Practices of RJC.

Principal Activities

Diamond Manufacturing Facilities -

The Company set up its first factory for diamond production at Udhana, in 1993. The Company Established second diamond cutting and polishing factory in Varachha in 2006 (100 % EOU) but now EOU status has been expired and established a unit in SEZ.

Green Energy Division (Wind Energy) -

The Company started the activities related to its Green Energy Division, by setting up Wind farm businesses at Sangli, Maharashtra in 2006 and Kutch, Gujarat in 2007.

The company has invested Rs. 68 Crores in the Green Energy in the state of Maharashtra and Gujarat. In the year 2005-06, the Company has installed eight Wind Turbine Generators (WTGs) each of 1.25 MW, total having 10 MW in the state of Maharashtra for sale of energy to MSEDCL. Further, in the year 2007-08, company has installed two Wind Turbine Generators (WTGs) each of 1.50 MW, total having 3.00 MW in the state of Gujarat for the captive consumption (Wheeling) for its units at, Udhana & Varachha in Surat.

The company has total revenue from sale of electricity generated from windmills during the year 2012-13 of Rs. 9.75 Crores.

Subsidiary Companies

As required under Section 212 of the Companies Act, 1956, the Audited Statements of Accounts of subsidiary companies:

1) C. Mahendra International Limited

2) C. Mahendra BVBA, Antwerp (Belgium)

3) C. Mahendra DMCC Dubai United Arab Emirates.

Auditors'' Reports thereon for the year ended March 31, 2013 are annexed.

Consolidated Financial Statements

In accordance with the Accounting Standard 21, issued by The Institute of Chartered Accountants of India, your Directors have pleasure in attaching the Consolidated

Financial Statements for the year ended March 31, 2013.

Finance

The Company is availing Working Capital requirements from the Consortium of 14 Bankers and has obtained adequate finance during the year under review. The debt is secured by immovable properties, current assets and others.

Dividend

The Board of Directors recommended 10% dividend (Rs. 1 per Equity Share of Rs. 10 each) on 1,50,00,000 Equity Shares to the ''Non-Promoter and Promoter Group'' absorbing a sum ofRs. 1,50,00,000/- and 6% dividend (Rs. 0.60 per preference share ofRs. 10 each) on 1,25,00,000 6% Redeemable Preference Shares absorbing a sum of Rs. 75,00,000/- to all 6% Redeemable Preference Shareholders as per the provisions of section 205 of the Companies Act, 1956 for the financial year ended 31st March, 2013. The dividend, if declared at the Annual General Meeting, will be paid within 30 days from the date of Annual General Meeting.

It is also informed that the 10% dividend of Rs 4,50,00,000/- on 4,50,00,000 Equity Shares belongs to "Promoter and Promoter Group" of the Company, is waived from the total amount of dividend on equity shares with their consent and provision of Articles of Association of the Company in this regard for the financial year ended 31.03.2013.

Directors

During the F Y. 2012-13, Mr. Shailesh S. Vaidya, Independent Director has resigned w. e .f 26th July, 2012 and Mr. Prabodh Nagardas Shah has been appointed as an Additional Director (Independent) in the meeting of Board of directors w. e .f 14th August, 2012 and was confirmed as Independent Director by Annual General Meeting dated 26th September, 2012.

Insurance

The Properties and Assets of the Company are adequately insured.

Particulars of Employees

The Company has no employees of the specified categories under section 217 (2A) of the Companies Act, 1956 read with Companies (particulars of employees) rules, 1975 as amended up to date.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Information under Section 217(l)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules. 1988 are given in Annexure I to this report.

Directors'' Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 Directors based on the representations receivedfrom the Operating Management, confirm:

(i) That in the preparation of the annual accounts for the financial year ended 31st March, 2013 the applicable accounting standards had been followed.

(ii) That the directors had selected such accounting policies and applied them Consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the company for the year.

(iii) That the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of The Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

(iv) That the directors had prepared the annual accounts for the financial year ended 31st March, 2013 on a going concern basis.

Disclosures under Section 217(l)(d) of the Companies Act, 1956

Except as disclosed elsewhere in this report, there have been no material changes and commitments which can affect the financial position of the Company occurred between the end of the financial year of the Company and date of this report.

Transfer to Reserves in terms of Section 217 (l)(b) of the Companies Act, 1956

For the financial year ended 31st March, 2013 the Company had transfer Rs. 311668602 to Reserves.

Statutory Auditors

TheAuditorsM/sR. H. Modi& Co. CharteredAccountants (Firm Reg. No. 106486W), Room No. 11, Singh House, 23, Ambalal Doshi Marg, 2nd Floor, Fountain,

Mumbai - 400 023 will retire at the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. Members are requested to consider their re-appointment on such remuneration as may be mutually agreed to between the Statutory Auditors and the Board. Acknowledgement

Your directors would like to place on record their deep sense of gratitude to the Shareholders, Banks, Financial Institutions, valued customers and business associates, and various other government/semi-government agencies for all the guidance, co-operation, support and encouragement extended by them to the company.

Your directors would also like to take this opportunity to gratefully appreciate the hard work and dedicated efforts put in by the employees and look forward to their continued contribution in future endeavors of the company.

For and On behalf of the Board of Directors

Sd/-

Date: 10/07/2013 (Mahendra C. Shah)

Place: Mumbai Chairman


Mar 31, 2012

The Directors are pleased to present the 6th Annual Report and the audited annual accounts for the financial year ended 31st March, 2012.

Financial Results

The financial performance of the Company, for the year ended 31st March, 2012 is summarized below:

(Rs in Million)

Particulars For the F. Y. For the F. Y. ended 31st ended 31st March, 2012 March,2011

Income from Operation:

Net Sales 19567.99 18,432.73

Other Income 526.67 177.67

Profit before Tax 410.65 537.60

Less: Current Tax (41.00) (76.00)

Mat Credit Entitlement 26.00 18.00

Deferred Tax 5.41 92.44

Wealth Tax 0 (0.03)

Profit after Tax 393.49 572.01

Less: Prior period income tax (7.57) (0.03) adjustment 1263.99 691.97

Add: Profit brought forward

Amount Available for 1649.91 1,263.95 Appropriation

Appropriation:

Utilized for bonus shares issued during the year _ _ Balance Carried to Balance Sheet 1649.91 1,263.95

1649.91 1,263.95

Review of Operations:

During the year under review, the Company's net sales are earned of Rs. 19,567.99 million net sales as against Rs. 18432.73 million during the previous financial year. showing growth of 6.16% compared to previous year.

Your Directors are continuously looking for avenues for future growth of the Company.

Background of C. Mahendra Group

C. Mahendra Exports Ltd, a renowned and trusted name since 1974, is one of the leading diamantaire and jewellery Company with a wide spread around the world.

The pioneers of the Company, Mr. Mahendra C. Shah and Mr. Champak K. Mehta commenced the business in 1974. C. Mahendra Exports was formed in the year 1978 to carry on the business of manufacturing and trading of diamonds. It is the flagship company of our CM Group. Subsequently three subsidiaries were established to handle the expanded business. C. Mahendra Exports set up its first state of the art factory for manufacturing cut and polished diamonds in Surat, India in the year 1993.

Offices were opened outside India for effective and increased marketing. In 2003 Ciemme Jewels incorporated in 2003, in 2006, C. Mahendra Exports commissioned the second state of the art manufacturing factory at Varachha Road, Surat, India to manufacture large size polished diamonds, In Jan, 2007, C. Mahendra Exports converted from Partnership Firm into a private company and March, 2007 changed from Private Company to Public Limited Company i.e. C. Mahendra Exports Ltd.

To C. Mahendra Exports Ltd. has employed the latest and most advanced technologies for manufacturing of cut and polished diamonds with ultimate brilliance diamonds. CM Group has a highly skilled pool of human resources.

C. Mahendra Exports Ltd. has its Registered and Sales Office in Mumbai from where all the marketing, assorting, administration and finance operations are controlled. The entire operation for manufacturing is controlled and managed from the Surat office. CM Group is firmly established across major diamonds and jewellery centers globally in 5 countries namely.

- China - Hong Kong

- India - Mumbai, Delhi

- UAE - Dubai

- Belgium - Antwerpen

- U.S.A-New York

C. Mahendra Exports Ltd. enjoys an envious position in the diamond industry of being one of the top exporters with an unblemished client record. C. Mahendra Exports Ltd. has its presence in the diamond studded jewellery business. Our branded jewellery is retailed under the brand name "Ciemme" across the world.

C Mahendra BVBA, the Antwerp based entity of the C Mahendra Group is a member of the Responsible Jewellery Council (RJC).The management of C Mahendra B.V.B.A., as a member of the Responsible Jewellery Council (RJC) is committed to complying with the Code of Practices of RJC.

Principal Activities

Diamond Manufacturing Facilities -

The Company set up its first factory for diamond production at Udhana, in 1993. The Company Established second diamond cutting and polishing factory in Varachha in 2006 (100% EOU)

Green Energy Division (Wind Energy) -

The Company started the activities related to its Green Energy Division, by setting up Wind farm businesses at Sangli, Maharashtra in 2006 and Kutch, Gujarat in 2007.

The company has invested Rs.68 Crores in the Green Energy in the state of Maharashtra and Gujarat. In the year 2005-06, the Company has installed eight Wind Turbine Generators (WTGs) each of 1.25 MW, total having 10 MW in the state of Maharashtra for sale of energy to MSEDCL. Further, in the year 2007-08, company has installed two Wind Turbine Generators (WTGs) each of 1.50 MW, total having 3.00 MW in the state of Gujarat for the captive consumption (Wheeling) for its units at, Udhana & Varachha in Surat.

The company has total revenue from sale of electricity generated from windmills During the year 2011-12 is Rs. 8,74,36,925/- Subsidiary Companies

As required under Section 212 of the Companies Act, 1956, the Audited Statements of Accounts of subsidiary companies:

1) C. Mahendra International Limited

2) C. Mahendra BVBA, Antwerp (Belgium)

3) C. Mahendra DMCC Dubai United Arab Emirates.

Auditors' Reports thereon for the year ended March 31, 2012 are annexed.

Consolidated Financial Statements

In accordance with the Accounting Standard 21, issued by The Institute of Chartered Accountants of India, your Directors have pleasure in attaching the Consolidated Financial Statements for the year ended March 31, 2012.

Finance

The Company is availing Working Capital requirements from the Consortium of 13 Bankers and has obtained adequate finance during the year under review. The debt is secured by immovable properties, current assets and others.

Directors

There was no change during the F. Y. 2011-12 , Thereafter Mr. Shailesh S. Vaidya, Independent Director has resigned w.e.f. 26th July, 2012.and Mr. Prabodh Nagardas Shah has been appointed as an Independent Director in the Board of directors w.e.f. 14th August, 2012.

Insurance

The Properties and Assets of the Company are adequately insured.

Particulars of Employees

The Company has no employees of the specified categories under section 217 (2A) of the Companies Act, 1956 read with Companies (particulars of employees) rules, 1975 as amended up to date.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Information under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are given in Annexure I to this report.

Directors' Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 Directors based on the representations received from the Operating Management, confirm:

(i) That in the preparation of the annual accounts for the financial year ended 31st March, 2012 the applicable accounting standards had been followed.

(ii) That the directors had selected such accounting policies and applied them Consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the company for the year.

(iii) That the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of The Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

(iv) That the directors had prepared the annual accounts for the financial year ended 31st March, 2012 on a going concern basis.

Disclosures under Section 217(1)(d) of the Companies Act, 1956 Except as disclosed elsewhere in this report, there have been no material changes and commitments which can affect the financial position of the Company occurred between the end of the financial year of the Company and date of this report.

Transfer to Reserves in terms of Section 217 (1)(b) of the Companies Act, 1956

For the financial year ended 31st March, 2012 the Company had transfer Rupees 39,34,90,906 to Reserves.

Statutory Auditors

The Board of directors of the Company considered the eligibility letter dated 31.08.2012 received from M/s R. H. Modi & Co., Chartered Accountants thereafter, proposed and recommended to appoint M/s R. H. Modi & Co., Chartered Accountants, (Firm Reg. No. 106486W), Room No. 11, Singh House, 23, Ambalal Doshi Marg, 2nd Floor, Fountain, Mumbai - 400 023, a new Statutory Auditors of the Company for the F. Y. 2012-13 at the ensuing Annual General Meeting of the Company in place of existing Statutory Auditors M/s Suresh Surana & Associates, Chartered Accountants, 310, Ahura Centre, 82, Mahakali Caves Road, Andheri (East), Mumbai - 400 093, who expressed its unwillingness to continue and resigned as the Statutory Auditors of the Company w. e. f. 30th August, 2012.

Acknowledgement

Your directors would like to place on record their deep sense of gratitude to the Shareholders, Banks, Financial Institutions, valued customers and business associates, and various other government/semi-government agencies for all the guidance, co-operation, support and encouragement extended by them to the company.

Your directors would also like to take this opportunity to gratefully appreciate the hard work and dedicated efforts put in by the employees and look forward to their continued contribution in future endeavors of the company.

For and On behalf of the Board of Directors

sd/-

(Mahendra C. Shah)

Chairman

Date: 01.09.2012

Place: Mumbai

 
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