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Directors Report of Century Enka Ltd.

Mar 31, 2015

Dear Members,

The Directors present the 49th Annual Report and Audited Financial Statements of the Company for the year ended 31st March, 2015.

The performance of the Company for the year was severely impacted mainly due to sudden drop in crude oil prices, resulting into heavy loss in carrying inventory value. Additional reasons were, increase in labour cost on account of wage settlement arrived at Pune factory and high electricity cost per unit as open access power purchase which was hitherto available to Bharuch site was denied by Gujarat Energy Transmission Corporation Limited.

FINANCIAL RESULTS

Rs. / Lacs This Previous Year Year

Net Sales / Income from 121853 146679 Operations(Less Excise Duty)

Profit before Depreciation, Finance Cost, Exceptional Items and Tax 12269 18963

Add / (Less) :

Depreciation (4275) (7071)

Finance Cost (1732) (2091)

Exceptional Items -- (220)

Taxation (Net) (2605) (3288)

Net Profit 3657 6293

Add : Balance brought forward from previous year 27470 23346

Profit available for appropriation 31127 29639

Less : Dividend (1311) (1311)

Tax on Dividend (267) (228)

General Reserve (370) (630)

Balance carried forward to next year 29179 27470

DIVIDEND

We recommend a dividend at the rate of 60% (i.e. Rs. 6/- per Equity Share of Rs. 10/- each) for the year ended 31st March, 2015 (Previous year at the rate of 60% i.e. Rs. 6/- per Equity Share of Rs. 10/- each).

COURSE OF BUSINESS AND OUTLOOK

The Management’s Discussion and Analysis Report as required under Corporate Governance Report is forming part of this report and gives the state of affairs of the business of the Company. As indicated, your Company has consolidated its position in Nylon Filament Yarn, keeping its focus on modification of additional Polymerlines and adding after treatment facility to provide bouquet of products in Nylon Filament Yarn for new applications in producing Nylon Textile Fabric. These efforts have helped increase its market share in Nylon Filament Yarn. Your Company has plans to make further investments to increase Nylon Filament Yarn capacity, which will also help to counter price cutting by competitors. In Nylon Tyre Cord Fabric, the Company has commissioned second dipping plant to meet tyre companies demand for dipped fabric and to retain its market share has undertaken modernization by replacing remaining two steps process plant by single step.

EXCISE DUTY DEMAND

The Company has filed an appeal against the order of Commissioner of Central Excise for the alleged excise duty demand of Rs. 22927 Lacs, equal amount of penalty and interest on duty amount before Customs, Excise and Service Tax Appellate Tribunal (CESTAT) Mumbai, denying benefit of notification No.6/2000 CE dated 01st March, 2000 for specific excise duty. The appeal has been admitted and stay granted on pre-deposit of Rs. 700 Lacs. Your Company has been advised by the legal counsel that it has a strong case to succeed and accordingly no provision is required to be made in books of account.

EXPANSION AND MODERNISATION

During the year, a part of continuous process polymerline at Bharuch site has been converted into non continuous and put into operation for manufacture of Nylon Filament Yarn.

Your Company offers wide range of Nylon Filament Yarn and to further broaden the product range has added about 4200 M.Tons per annum capacity by installing Air Text urising and Draw Texturising machines. Your Company is actively considering to install few more Air Texturising machines and FDY machine to strengthen its leadership position in Nylon Filament Yarn.

A part of manufacturing capacity of Nylon Tyre Cord Fabric (NTCF) is based on two steps process technology which has become obsolete. Your Company has taken up modernisation by converting the existing capacity of two steps process with one step and expects to complete the installation by July- September 2015.

The second Dipping plant at Bharuch site has been commissioned in August 2014.

HEALTH, SAFETY AND ENVIRONMENT

The report on Management’s Discussion and Analysis includes observations on health, safety and environment compliances by the Company.

All Plant sites of the Company are environment regulations compliant.

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

Particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 are set out in a separate statement attached hereto and forming part of the report. (Annexure - I)

CORPORATE GOVERNANCE

Your Company reaffirms its commitment to Corporate Governance and is fully compliant with the conditions of Corporate Governance stipulated in Clause 49 of the Listing Agreement with Stock Exchanges. A separate section on compliance with the conditions of Corporate Governance and a Certificate from the firm of Practising Company Secretaries dated 5th May, 2015 in this regard is annexed hereto and forms a part of the report.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

(including criteria for determining qualification, positive attributes, independence of a Director, policy relating to remuneration for Directors, Key Managerial Personnel and other employees)

Policy on Directors’ Appointment

Policy on Directors’ appointment is to follow the criteria as laid down under the Companies Act, 2013 and the Listing Agreement with Stock Exchanges and good corporate practices. Emphasis is given to persons from diverse fields or professions.

Policy on Remuneration

Guiding Policy on remuneration of Directors, Key Managerial Personnel and employees of the Company is that -

* Remuneration to unionised workmen is based on the periodical settlement with the workmen union.

* Remuneration to Key Managerial Personnel, Senior Executives, Managers, Staff and Workmen (non Unionised) is industry driven in which it is operating taking into account the performance leverage and factors such as to attract and retain quality talent.

* Ror Directors, it is based on the shareholders resolutions, provisions of the Companies Act, 2013 and Rules framed therein, circulars and guidelines issued by Central Government and other authorities from time to time.

ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE, ITS COMMITTEES AND INDIVIDUAL DIRECTORS

The Board of Directors of the Company has initiated and put in place evaluation of its own performance, its committees and individual directors. The result of the evaluation is satisfactory and adequate and meets the requirement of the Company.

DECLARATION OF INDEPENDENCE BY THE INDEPENDENT DIRECTORS

Pursuant to Section 149(6) of the Companies Act, 2013, Independent Directors of the Company have made a declaration confirming the compliance of the conditions of the independence stipulated in the aforesaid section.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 134(1)(c) of the Companies Act, 2013 and on the basis of explanation and compliance certificate given by the executives of the Company, and subject to disclosures in the Annual Accounts and also on the basis of discussions with the Statutory Auditors of the Company from time to time, we state as under :

a) that in the preparation of the annual accounts, the applicable accounting standards had been followed alongwith proper explanation relating to material departure;

b) t hat 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 of the Company for that period;

c) 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, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) t hat the directors had prepared the annual accounts on a going concern basis;

e) that the directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f) t hat the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

DIRECTORS

Your Board of Directors with deep regret noted the sad demise of Mrs. Saraladevi Birla on 28th March, 2015. In her death, the Board of Directors has lost a visionary, able leader and philanthropist.

Your Board of Directors has appointed Mrs. Rajashree Birla on 5th May, 2015 to fill up the casual vacancy caused by the demise of Mrs. Saraladevi Birla, a Director liable to retire by rotation. Mrs. Rajashree Birla is having vast experience of Industry and is on the Board of many large reputed listed companies.

Mr. R.A. Shah resigned from the directorship of the Company w.e.f. 30th October, 2014 due to regulatory requirements under the Companies Act, 2013 and the Listing Agreement. Mr. R.A. Shah was associated with the Company as a Director for more than 40 years. Your Directors place on record their appreciation for the valuable services rendered by Mr. R.A. Shah.

Mr. K.S. Thar has been appointed as an Independent Director of your Company on 27th November, 2014 to fill up the casual vacancy caused by the resignation of Mr. R.A. Shah. Mr. K.S. Thar is a Practising Chartered Accountant, having more than 30 years of experience of audit, taxation and corporate laws. His appointment as an Independent Director is proposed for a term of 5 years.

Notices under Section 160 of the Companies Act, 2013 from members of the Company signifying the candidatures of Mrs. Rajashree Birla and Mr. K.S. Thar for the office of the Directors have been received.

NUMBER OF MEETING OF BOARD OF DIRECTORS

The Board of Directors have met 6 times and Independent Directors once during the year ended 31st March, 2015.

DETAILS OF COMMITTEE OF DIRECTORS

Composition of Audit Committee of Directors, Nomination and Remuneration Committee of Directors and Stakeholders Relationship/Grievance Committee of Directors, number of meetings held of each Committee during the financial year 2014-15 and meetings attended by each member of the Committee as required under the Companies Act, 2013 are provided in Corporate Governance Report and forming part of the report.

The recommendation by the Audit Committee as and when made to Board has been accepted by it.

KEY MANAGERIAL PERSONNEL

Your Company has designated Mr. D.B. Roonghta, who is Executive President of Pune site as Chief Financial Officer. Mr. S. Thapliyal, the President of the Company is also a Key Managerial Personnel. Mr. G.M. Singhvi the Whole-time Director and Mr. C.B. Gagrani, Company Secretary who have been appointed before commencement of the Companies Act, 2013 are the Key Managerial Personnel.

PARTICULARS OF CONTRACT OR ARRANGEMENT WITH RELATED PARTY

There is no transaction with Related Party which requires disclosure under Section 134(3)(h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014.

LOANS, INVESTMENT AND GUARANTEES BY THE COMPANY

There is no loan given, investment made, guarantee given or security provided by the Company to any entity under Section 186 of the Companies Act, 2013.

FIXED DEPOSITS

Your Company has not accepted any fixed deposits from the public during the financial year ended 31st March, 2015. Fixed deposits accepted from employees and outstanding as on 31st March, 2014 have been repaid during the financial year ended 31st March, 2015.

RISK MANAGEMENT

During the year, Management of the Company, evaluated the existing Risk Management Policy of the Company to make it more focused in identifying and prioritising the risks, role of various executives in monitoring & mitigation of risk and reporting process. The Risk Management Policy has been reviewed and found adequate to the requirements of the Company by independent firms of Chartered Accountants and approved by the Board.

The Management evaluated various risks and that there is no element of risk identified that may threaten the existence of the Company.

A detailed report on significant risks and mitigation is forming part of Management’s Discussion and Analysis.

WHISTLE BLOWER MECHANISM

Your Company has put in place Whistle Blower Mechanism. The detailed mechanism is given in Corporate Governance Report forming part of this report.

CORPORATE SOCIAL RESPONSIBILITY

Your Company understands the importance of Corporate Social Responsibility (CSR) activities that bring a meaningful and lasting improvement in the life of youth and marginalised section of the society, more particularly of backward region. It has been a commitment of your Company to the society, since inception, in conducting CSR activities, particularly for the benefit of the people living in peripheral of its plant sites. To achieve this objective, the Company during the year 2014-15 has participated by funding in setting up a skill development institute in vicinity of the Company’s Bharuch site, a backward region to help local youth for gaining better employment opportunity and funded for a project for drinking water supply to a village Panchayat Savane near the Company’s Mahad site. In addition to these projects, the Company has taken up programmes for health, education, sanitary and environment. Your Company has spent Rs. 94 Lacs on CSR Projects and Programmes during the financial year 2014-15.

An annual report on CSR, pursuant to Rule 8 of the Companies (CSR Policy) Rules, 2014 is annexed herewith and forming part of the report. (Annexure - II)

ANALYSIS OF REMUNERATION

Pursuant to Rule 5 of the Companies (Appointment and Remuneration) Rules, 2014 a disclosure on remuneration related information of employees, Key Managerial Personnel and Directors is annexed herewith and forming part of the report. (Annexure - III)

AUDITORS

M/s. Price Waterhouse, the Auditors of the Company will retire from the office of the Auditors and being eligible offer themselves for re-appointment. Their remuneration for the current year is to be fixed by you.

COST AUDITORS

Your Company has appointed M/s. N.I. Mehta & Co., Cost Auditors for conducting the cost account records for the products Nylon and Polyester for the financial year ended 31st March, 2016.

SECRETARIAL AUDIT REPORT

A Secretarial Audit Report for the year ended 31st March, 2015 in prescribed form duly audited by the Practising Company Secretary M/s. Sanjay Sangani & Co. is annexed herewith and forming part of the report.

PARTICULARS OF EMPLOYEES

Pursuant to the provisions of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the names and other particulars of employees are set out in a separate statement is annexed herewith and forming part of the report. (Annexure - IV)

EXTRACT OF ANNUAL RETURN

Pursuant to Section 134(3)(a) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules 2014, the extract of annual return is annexed herewith and forming part of the report. (Annexure - V)

For and on behalf of the Board of Directors

B. K. BIRLA Place : Mumbai G. M. SINGHVI Date : May 05, 2015 Directors


Mar 31, 2014

Dear Shareholders,

The Directors present the 48th Annual Report and Audited Statements of Accounts of the Company for the year ended 31st March, 2014.

The overall performance of the Company was quite satisfactory inspite of lower production and sales resulting on account of suspension of Continuous Process Plant (Polyester) at Bharuch site in November 2013 which was incurring financial losses. In addition to this, saving in energy cost, production of high value added products, better product mix and general improvement in operational efficiency also helped in improving the financial results for the year.

FINANCIAL RESULTS

(Rs./ Lacs)

This Year Previous Year

Net Sales / Income from Operations (Less Excise Duty) 146679 155217

Profit before Depreciation, Finance Cost, Exceptional Items and Tax 19324 14788

Add / (Less) :

Depreciation (7071) (7191)

Finance Cost (2452) (2946)

Exceptional Items (220) (1503)

Taxation (Net) (3288) (959)

Net Profit 6293 2189

Add : Balance brought forward from previous year 23346 22921

Profit available for appropriation 29639 25110

Less : Dividend 1311 1311

Tax on Dividend 228 233

General Reserve 630 220

Balance carried forward to next year 27470 23346

DIVIDEND

We recommend a dividend at the rate of 60% (i.e. Rs. 6/- per Equity Share of Rs. 10/- each) for the year ended 31st March, 2014 (Previous year at the rate of 60% i.e. Rs. 6/- per Equity Share of Rs. 10/- each).

COURSE OF BUSINESS AND OUTLOOK

The Management''s Discussion and Analysis Report, as required under Corporate Governance, is forming a part of this report and gives a refection of the current state of business. As indicated in the said report, re-engineering and modification work in making a part of the Continuous Process Plant into Non- continuous Process Plant has been satisfactory. Your Company has been able to produce value added products of different polymers with good quality. In view of this accomplishment, in the current year, your Company is concentrating on enlarged area of restructuring its operations by re-engineering and modification work of the remaining part of Continuous Process Plant. The Management is hopeful of converting the said plant into a better versatile plant capable of producing different polymers with increased operational efficiency at lower cost.

The commissioning of additional dipping capacity will help the Company to satisfy tyre companies with the increased supply of dipped fabric in place of greige fabric.

EXCISE DEMAND

With reference to the observation of the Statutory Auditors in their report on the order of the Excise Department raising a demand of Rs. 229.27 Crs. alongwith an equal amount of penalty and interest thereon, your Company has been advised by the legal experts that it has a strong case. The Company has fled an Appeal before the Central Excise and Service Tax Appellate Tribunal (CESTAT) Mumbai and expects a favourable outcome and accordingly no provision has been made in the accounts for the year.

EXPANSION AND MODERNISATION

The study of the Consultant on Polyester products particularly Partially Oriented Yarn (POY) and Chips suggests that the existing capacity will continue to remain surplus for another 2-3 years with thin to negative margins. Your Directors will take a cautious approach before committing any new investment in this area. The Company is exploring the possibilities of entry into polyester tyre cord fabric and other polymers used in non- tyre application.

SAFETY AND ENVIRONMENT

The report on Management''s Discussion and Analysis includes observations on safety and environment.

Considerable emphasis is given by your Company on conservation and preservation of water, reducing the effuent as well as better management of effuent to keep the surrounding area clean and healthy.

All Plant sites of the Company are environment regulations compliant.

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

Particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out in a separate statement attached hereto and forming part of the report.

CORPORATE GOVERNANCE

Your Company reaffirms its commitment to Corporate Governance and is fully compliant with the conditions of Corporate Governance stipulated in clause 49 of the Listing Agreement with Stock Exchanges. A separate section on compliance with the conditions of Corporate Governance and a Certifcate from the firm of practicing Company Secretaries dated 5th May, 2014 in this regard is annexed hereto and forms a part of the Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 217(2AA) of the Companies Act, 1956 and on the basis of explanation and compliance certifcate given by the executives of the Company, and subject to disclosures in the Annual Accounts and also on the basis of discussions with the Statutory Auditors of the Company from time to time, we state as under :

(i) that in the preparation of the annual accounts, 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 of the Company for that period;

(iii) that the directors had taken proper and suffcient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(iv) that the directors had prepared the annual accounts on a going concern basis.

DIRECTORS

Mr. B. K. Birla, who will retire by rotation and being eligible offers himself for re-appointment

Mrs. Saraladevi Birla has been appointed as an Additional Director of the Company w.e.f. 5th May, 2014. Mrs. Saraladevi Birla will hold the office upto the date of ensuing Annual General Meeting. Notices have been received under Section 160 of the Companies Act, 2013 from members of the Company signifying the candidature of Mrs. Saraladevi Birla for the office of Director liable to retire by rotation.

Mr. R. A. Shah, Mr. B. S. Mehta and Mr. S. K. Jain, the Independent Directors of the Company are seeking their appointments under Section 149 of the Companies Act, 2013 for a term of five years upto 31st March, 2019.

Notices under Section 160 of the Companies Act, 2013 from members of the Company signifying their candidatures for the office of the Directors have been received.

AUDITORS

Messrs. Price Waterhouse, the Auditors of the Company will retire from the office of the Auditors and being eligible offer themselves for re-appointment. Their remuneration for the current year is to be fixed by you.

COST AUDITORS

The Cost Audit Reports for the products Polyester and Nylon for the financial year ended 31st March, 2013 signed by M/s. N.I. Mehta & Co., Cost Auditors were fled within due date with the Ministry of Corporate Affairs.

Your Company has also appointed M/s. N.I. Mehta & Co., Cost Auditors for conducting the cost account records for the products Polyester and Nylon for the financial year ended 31st March, 2014.

PARTICULARS OF EMPLOYEES

Pursuant to 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 the Directors'' Report. However, as per the provisions of Section 219(1)(b)(iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all members of the Company. Any member, who is interested in obtaining such particulars about employees may write to the Company Secretary at the Registered office of the Company.

For and on behalf of the Board of Directors

B. S. MEHTA Place : Mumbai G. M. SINGHVI

Date : May 5, 2014 (Directors)


Mar 31, 2013

Dear Shareholders,

The Directors present the 47th Annual Report and Audited Statements of Accounts of the Company for the year ended 31st March, 2013.

The overall performance of the current year was satisfactory due to efficient management of energy cost, suspension of unviable operations and general improvement in operational efficiency.

FINANCIAL RESULTS

(Rs. / Lacs) This Year Previous Year

Net Sales / Income from Operations (Less Excise Duty) 155217 164951

Profit before Depreciation, Finance Cost, Exceptional Items and Tax 14788 9950

Add / (Less) :

Depreciation (7191) (6743)

Finance Cost (2946) (3172)

Exceptional Items (1503) -

Taxation (Net) (959) 843

Net Profit 2189 878

Add : Balance brought forward from previous year 22921 23401

Profit available for appropriation 25110 24279

Less :Dividend 1311 1093

Tax on Dividend 233 177

General Reserve 220 88

Balance carried forward to next year 23346 22921

DIVIDEND

We recommend a dividend at the rate of 60% (i.e. Rs. 61- per Equity Share of Rs. 10/- each) for the year ended 31st March, 2013 (Previous year at the rate of 50% i.e. Rs. 5/- per Equity Share of Rs. 10/- each).

COURSE OF BUSINESS AND OUTLOOK

The Management''s Discussion and Analysis Report, as required under Corporate Governance, is forming a part of this report and gives a reflection of the current state of business. It also deals with opportunities, challenges and the outlook of the Company.

In May 2012, your Company suspended unviable manufacturing operations at Mahad site. The Company has conducted a feasibility study and has now reached to the conclusion that present manufacturing operations at Mahad site cannot be made viable mainly due to high energy and other utility costs. Apart from this, high transportation cost, being away from market place and raw material sourcing centre vis-a-vis competitors who are mostly located around Surat and Silvassa. In view of the above, it is decided to close the operations at Mahad site.

Your Company, in view of falling margins in Polyester POY, is restructuring its Polyester operations at Bharuch site to create dual facilities to manufacture Polyester POY as well Nylon Filament Yarn and of different types of lustres.

Your Company continues its focus on cost control, inventory management and productivity enhancement to improve margins.

EXPANSION & MODERNISATION

Your Company proposes to expand dipping facility of 15000 MT per annum Nylon Tyre Cord Fabric (NTCF) at Bharuch site to meet the increasing demand of dipped NTCF from tyre companies. In addition to that, the Company is also adding some balancing equipment to carry out debottlenecking of NTCF capacity. The total investment in dipping and debottlenecking is expected to be about Rs. 50 crores.

HUMAN RESOURCE DEVELOPMENT AND ENVIRONMENT

The report on Management''s Discussion and Analysis includes observations on human resource development and environment. It is your Company''s belief to cultivate competitive capability both functional and behavioural of its human resources and to facilitate that, your Company regularly organized training programmes.

Your Company''s industrial relations continued to be harmonious during the year under review.

Your Directors would like to place on record their appreciation for the efforts undertaken by the employees to control cost and improve productivity.

Considerable emphasis is given by your Company on preservation of environment and to combat for and support ecology, plantations have been carried out in and around the surrounding area of the Company''s plants.

All Plant sites of the Company are environment regulations compliant.

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

Particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out in a separate statement attached hereto and forming part of the report.

CORPORATE GOVERNANCE

Your Company reaffirms its commitment to Corporate Governance and is fully compliant with the conditions of Corporate Governance stipulated in Clause 49 of the Listing Agreement with Stock Exchanges. A separate section on compliance with the conditions of Corporate Governance and a Certificate from the firm of practicing Company Secretaries dated 15th May, 2013 in this regard is annexed hereto and forms a part of the Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 217(2AA) of the Companies Act, 1956 and on the basis of explanation and compliance certificate given by the executives of the Company, and subject to disclosures in the Annual Accounts and also on the basis of discussions with the Statutory Auditors of the Company from time to time, we state as under:

(i) that in the preparation of the annual accounts, 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 of the Company for that period;

(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; and

(iv) that the directors had prepared the annual accounts on a going concern basis.

DIRECTORS

Mr. G. M. Singhvi, Whole-time Director of your Company whose tenure of 3 (three) years comes to end on 15th May, 2013 has been reappointed by the Board of Directors in its Meeting held on that date for a period of 3 (three) years, commencing from 16th May, 2013 subject to approval of the shareholders of the Company at the forthcoming Annual General Meeting.

In accordance with Articles of Association of the Company, Mr. R. A. Shah and Mr. B. S. Mehta, Directors of the Company will retire by rotation and being eligible, offer themselves for re-appointment.

AUDITORS

Messrs. Price Waterhouse, the Auditors of the Company will retire from the office of the Auditors and being eligible offer themselves for re-appointment. Their remuneration for the current year is to be fixed by you.

COST AUDITORS

The Cost Audit Reports for the products Polyester and Nylon for the financial year ended 31st March, 2012 signed by M/s. N.I. Mehta & Co., Cost Auditors were due for filing on or before 31s1 January, 2013 and the same were filed with Ministry of Corporate Affairs on 31st January, 2013.

Your Company has also appointed M/s. N.I. Mehta & Co., Cost Auditors for conducting the cost account records for the products Polyester and Nylon for the financial year ended 31 st March, 2013.

PARTICULARS OF EMPLOYEES

Pursuant to 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 the Directors'' Report. However, as per the provisions of Section 219(1)(b)(iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all members of the Company. Any member, who is interested in obtaining such particulars about employees may write to the Company Secretary at the Registered Office of the Company.

For and on behalf of the Board of Directors

B. K. BIRLA

Place : Mumbai G. M. SINGHVI

Date : May 15, 2013 (Directors)


Mar 31, 2012

The are presenting the 46th Annual Report and Audited Statements of Accounts of the Company for the year ended 31st March, 2012. In last year's Annual Report, concern was expressed over the prices of raw materials and fuel oil to remain firm in the background of high crude oil prices. The actual situation was worse than anticipated. Prices of raw materials, fuel oil and gas touched all time high. A major part of the cost could not be passed on to customers. Substantial capacity expansion in Polyester POY and new entrants in Nylon Filament Yarn (NFY) led to surplus availability and intense competition. The combined effect of these factors resulted into erosion of profit margins. In the light of such external adverse conditions, with better inventory management and cost control measures, the erosion in profit margins, to some extent, could be minimized.

FINANCIAL RESULTS

Rs./ Lacs

This Year Previous Year

Net Sales / Income from Operations (Less

Excise Duty) 164951 134908

Profit before Depreciation, Finance Cost, Exceptional Items and Tax 9950 18352

Add / (Less):

Depreciation (6743) (6115)

Finance Cost (3172) (1618)

Taxation (Net) 843 (2683)

Net Profit 878 7936

Add: Balance brought forward previous year 23401 18616

Profit available for appropriation 24279 26552

Less: Dividend 1093 1420

Tax on Dividend 177 231

General Reserve 88 1500

Balance carried forward to next year 22921 23401

DIVIDEND

We recommend a dividend at the rate of 50% (i.e. Rs. 5/- per Equity Share of Rs. 10/- each) for the year ended 31st March, 2012 (Previous year 65% i.e. Rs. 6.50 per Equity Share of Rs. 10/- each),

COURSE OF BUSINESS AND OUTLOOK

As required under Corporate Governance, the Management's Discussion and Analysis Report which is forming a part of this report, is a reflection of the current state of business. It also deals with opportunities and challenges faced by your Company and the outlook for the future.

Looking at the international political scenario, crude oil prices may remain firm. Consequently, prices of all major raw materials, furnace oil and gas are likely to remain high in the current year also. Further, Rupee depreciation against Dollar will also impact their prices. These factors will lead to continued pressure on profit margins in the shorter run.

Your Company's efforts are under way to optimize product contribution, cost control and inventory management to overcome the impact of high cost and improve profit margins.

The commissioning of 7500 tons per annum NTCF capacity & dipping plant at Barouche site and growing Indian economy with good demand growth in end-use products, your Company perceives that the outlook is positive.

EXPANSION & MODERNISATION

Installation of NTCF Dipping Plant has been completed in second half of the financial year 2011-12. Product approvals from customers have been received and plant has become fully operational. Installation of 4 MW Gas Generating Set could be completed in fourth quarter of the financial year 2011 - 12 due to delay in receiving various administrative approvals. It has now become operational.

HUMAN RESOURCE DEVELOPMENT AND ENVIRONMENT

The report on Management's Discussion and Analysis includes its observations on human resource development and environment. It is your Company's belief to cultivate competitive capability and effectiveness of its human resources.

Industrial relations at all the plant sites of the Company are cordial. The Wage Agreement for Mahad site expired in December 2010, a new agreement is yet to be concluded.

The Directors would like to place on record their appreciation for the employees efforts at all levels to control cost and improve productivity.

Your Company gives strong thrust on preservation of environment and all the plant sites of the Company are environment regulations compliant.

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

Particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out in a separate statement attached hereto and forming part of the report.

CORPORATE GOVERNANCE

Your Company reaffirm its commitment to Corporate Governance and is fully compliant with the conditions of Corporate Governance stipulated in Clause 49 of the Listing Agreement with Stock Exchanges. A separate section on compliance with the conditions of Corporate Governance and a Certificate from the firm of practicing Company Secretaries dated 2nd May, 2012 in this regard is annexed hereto and forms a part of the Report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 217(2AA) of the Companies Act, 1956 and on the basis of explanation and compliance certificate given by the executives of the Company, and subject to disclosures in the Annual Accounts and also on the basis of discussions with the Statutory Auditors of the Company from time to time, we state as under:

i) that in the preparation of the annual accounts, 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 of the Company for that period;

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 safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

iv) that the directors had prepared the annual accounts on a going concern basis.

DIRECTORS

In accordance with Articles of Association of the Company, Mr.B K Birla and Mr. S K Jain, Directors of the Company will retire by rotation and being eligible, offer themselves for re-appointment.

AUDITORS

Messrs. Price Waterhouse, the Auditors of the Company will retire from the office of the Auditors and being eligible offer themselves for re-appointment. Their remuneration for the current year is to be fixed by you.

COST AUDITORS

The Cost Accounts Records maintained by your Company for the products - Polyester and Nylon are subject to yearly audit by qualified Cost Auditors. Your Company has appointed M/s. N.I. Mehta & Co., a firm of Cost Auditors for conducting the audit of such records for the financial year 2011-12.

PARTICULARS OF EMPLOYEES

Pursuant to 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 the Directors' Report. However, as per the provisions of Section 219(1 )(b)(iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all members of the Company. Any member, who is interested in obtaining such particulars about employees may write to the Company Secretary at Registered Office of the Company.

For and on behalf of the Board of Directors

B. K. BIRLA G. M. SINGHVI

(Directors)

Place: Mumbai

Date : May 02, 2012


Mar 31, 2011

We have pleasure in presenting the 45th Annual Report and Audited Statements of Accounts of the Company for the year ended 31st March, 2011. The overall performance of the current year was satisfactory inspite of high raw material and fuel oil prices and lower sales of Nylon Tyre Cord Fabric (NTCF). The lower off-take of NTCF by the tyre companies was mainly due to labour unrest at their factories and high level of imports of bus & truck tyres in the third quarter of the financial year that forced tyre companies to cut their production.

FINANCIAL RESULTS

Rs. / Lacs

This Year Previous Year

Sales / Income from Operations (Less Excise Duty) 134433 123087

Profit before Depreciation, Interest, Exceptional Items and Tax 17792 22437 Add / (Less): Depreciation (6115) (6106) Interest (Net) (1058) (741) Taxation (Net) (2683) (5238)

Voluntary Retirement compensation - (336)

Net Profit 7936 10016

Add: Balance brought forward from previous year 18616 11629

Profit available for appropriation 26552 21645 Less :Dividend 1420 1311 Tax on Dividend 231 218 General Reserve 1500 1500

Balance carried forward to next year 23401 18616



DIVIDEND

We recommend a dividend at the rate of 65% (i.e. Rs. 6.50 per Equity Share of Rs.10/- each) for the year ended 31st March, 2011 (Previous year 60% i.e. Rs.6/- per Equity Share of Rs.10/- each).

COURSE OF BUSINESS AND OUTLOOK

As required under Corporate Governance, the Managements Discussion and Analysis Report which is forming a part of this report, is a refection of the current state of business. It also

deals with the opportunities and challenges faced by your Company and the outlook for the future.

Your Company would like to add that in view of high crude oil prices in the international market, the prices of raw material and fuel oil are likely to remain firm in the current financial year and may cause pressure on profit margins. However, with the recently completed capital expenditure of about Rs. 200 crores, your Company is hopeful of improved performance in the current financial year.

With growing Indian economy and good demand growth in end- used products i.e. synthetic textile and automobile tyres, the long-term outlook remains positive.

EXPANSION & MODERNISATION

The trial runs in connection with capacity expansion of Nylon Tyre Cord Fabric (NTCF) by 7500 tons per annum have been completed and process conditions are being stabilised for regular commercial production as per the requirements of tyre companies. It is expected to achieve full capacity utilization within 3 months. 13 MW gas based power plant has been successfully commissioned at Pune site. There is some delay in installation of 4 MW LNG gas based power plant at Bharuch. The same is now expected to be commissioned by the third quarter of current financial year.

Most of the modernisation and de-bottlenecking projects undertaken by the Company have been completed. The installation of new Nylon Polymerisation capacity is on hold and will be reviewed in due course.

HUMAN RESOURCE DEVELOPMENT AND ENVIRONMENT

The report on Managements Discussion and Analysis includes its observations on human relations, approach to human resource development, safety, health and environment.

The Company provides a fair and equitable work environment to all its employees, and with support from their seniors, is fully engaged in developing their skills. The Company is continuously working to create and nurture an atmosphere which is highly motivated, result-oriented and adaptable to changing business environment.

The Directors place on record their appreciation for workmen, staff and management in bringing improvement at all levels in factories and offices of the Company and effective response to changing environment.

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

Particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out in a separate statement attached hereto and forming part of the report.

CORPORATE GOVERNANCE

Your Company reaffirm its commitment to Corporate Governance and is fully compliant with the conditions of Corporate Governance stipulated in clause 49 of the Listing Agreement with the Stock Exchanges. A separate section on compliance with the conditions of Corporate Governance and a Certifcate from the firm of practising Company Secretaries dated 2nd May, 2011 in this regard is annexed hereto and forms a part of the Report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 217(2AA) of the Companies Act, 1956 and on the basis of explanation and compliance certificate given by the executives of the Company, and subject to disclosures in the Annual Accounts and also on the basis of discussions with the Statutory Auditors of the Company from time to time, we state as under:

i) that in the preparation of the annual accounts, 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 of the Company for that period;

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; and

iv) that the directors had prepared the annual accounts on a going concern basis.

DIRECTORS

In accordance with Articles of Association of the Company, Mr.R. A. Shah and Mr.B. S. Mehta, Directors of the Company will retire by rotation and being eligible, offer themselves for re-appointment.

AUDITORS

Messrs. Price Waterhouse, the Auditors of the Company will retire from the office of the Auditors and being eligible offer themselves for re-appointment. Their remuneration for the current year is to be fixed by you.

COST AUDITORS

The Cost Accounts records maintained by your Company for the products - Polyester and Nylon are subject to yearly audit by qualified Cost Auditors. Your Company has appointed M/s. N.I. Mehta & Co., a firm of Cost Auditors for conducting the audit of such records for the financial year 2010-11.

PARTICULARS OF EMPLOYEES

Pursuant to 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 the Directors Report. However, as per the provisions of Section 219(1)(b)(iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all members of the Company. Any member, who is interested in obtaining such particulars about employees may write to the Company Secretary at Registered Office of the Company.

For and on behalf of the Board of Directors

B. K. BIRLA G. M. SINGHVI (Directors)

Place : Mumbai Date : May 02, 2011

 
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