Mar 31, 2015
Dear Members,
The Directors hereby present the 11th Annual Report together with the
Financial Statements of the Company for the financial year ended March
31,2015.
FINANCIAL RESULTS:
(Rs. in Lakhs)
Particulars Year Ended Year Ended
March 31,2015 March 31,2014
Revenue from operations 1443.68 1169.20
Other Income 797.80 234.44
Total Income 2241.48 1403.64
Less: Total Expenditure 1601.99 1492.45
Earnings Before Interest,
Depreciation and Tax 639.49 (88.81)
Less : Interest and other
finance expenses 12540.17 25.06
Less: Depreciation 1409.84 1901.91
Profit/(Loss) Before Tax (13310.52) (2015.78)
Less: Provision of Tax - -
Net Profit/(Loss) After Tax (13310.52) (2015.78)
Add: Balance Brought forward
from the previous year (15534.69) (13518.91)
Balance Carried forward to
Balance Sheet (28845.21) (15534.69)
FINANCIAL REVIEW:
The turnover of the Company for the year ended 31st March, 2015,
increased by 23.47% and stood at Rs. 1443.68 Lakhs as against Rs.
1169.2* Lakhs in the previous year. During the year under review, your
Company recorded total income of Rs. 2241.48 Lakhs as against Rs.
1403.64 Lakhs in the previous year. The year under review was adversely
affected due to stressed working capital and liquidity crunch thereby
affecting the earning capacity of the company. This resulted in low
turnover and income in the year under review, thereby having a loss of
Rs. 13,310.52 Lakhs as against loss of Rs. 2,015.78 Lakhs in the
previous year.
PERFORMANCE REVIEW:
The performance during the year was not satisfactory due to various
reasons beyond the control of the Management. The products in which the
Company is dealing, is facing cut throat competition. The supply
pressure in the market is leading to the buyers' market and price
erosion. At the same time, the costs have increased due to inflation in
the economy and devaluation of Rupee against the foreign currencies.
Due to this, the company is currently facing liquidity mismatch wherein
it is not generating enough cash flows to meet its debt obligations on
time.
Reductions in the subsidies and withdrawal of Government incentive
programmes in major European markets have generated a negative
sentiment for photovoltaic (PV) installations. At the same time huge
dumping by Chinese Solar Products manufacturers resulted in the fall in
prices. The severe fall in the prices of Solar Photovoltaic cells
globally on account of reduced demand resulted in the Company position
in very tragic condition wherein the Company is unable to stand in the
Competitive and Price sensitive market. As a result, the Company has
been unable to utilize its capacity and the cost of production of solar
cells continues to be higher than the prevailing market prices.
With the continued pledge and commitment across developed and
developing countries by the governments, towards renewable sources of
energy, demand for solar energy is expected to improve.
FUTURE PROSPECTS:
JNNSM guidelines stipulate that the certain grid connected Solar PV
plants in India needs to install the Indian made Solar Modules which
should contain Indian made Solar Cells. This will create the market for
Indian Solar cell Manufacturers to market their products. US and
European Union is also considering the possibility of imposing the anti
dumping duty against the solar products manufactured in China. They
moved in this direction and US has imposed provisional anti dumping
duty on solar products manufactured in China. This will create the
market for all the global manufacturers other than Chinese one. You
Company has also envisages the huge potential of business opportunity
going ahead. However, at the same time the challenges in the form of
adequate working capital, supply of products of prevalent quality and
product efficiency needs to be addressed by all the Indian players.
Indian Government is focused on the implementation of its various
programmes of promoting solar power generation under the various
schemes which are implemented at centre and state level. This will
create new business opportunities for the solar industry.
DIVIDEND:
In view of losses during the year under review, your Directors do not
recommend any dividend for the financial year 2014-15.
SHARE CAPITAL OF THE COMPANY:
The paid-up equity share capital of the Company is Rs. 23,80,00,490/-
(Rupees Twenty Three Crores Eighty Lacs Four Hundred and Ninety Only)
divided into 2,38,00,049 Equity Shares having face value of Re.10/-
(Rupee Ten) each.
REFERENCE TO BIFR:
In the financial year 2012-2013, the Company on the basis of the
audited accounts for the financial year ended as on March 31, 2012, and
being mandatory, filed the reference under section 15(1) of Sick
Industrial Companies (Special Provisions) Act, 1985 before the Hon'ble
Board for Industrial & Financial Reconstruction (BIFR). The above
reference has duly been registered by the Registrar of Hon'ble BIFR and
hearings of which are in the process for determination of sickness.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
In accordance with the provisions of Section 152 of the Companies Act,
2013 read with the Companies (Management and Administration) Rules,
2014 and the Articles of Association of the Company, Mr. Rajababu
Kalla, Whole-time Director of the Company, retires by rotation at the
ensuing Annual General Meeting and being eligible offered himself for
re-appointment.
Mrs. Forum Shah was appointed as an Additional Director of the Company
with effect from 24th March, 2015 and she holds office up to the date
of the ensuing Annual General Meeting. The Company has received Notice
along with requisite deposit from a member of the Company under Section
16* of the Companies Act, 2013 proposing her candidature for the office
of Director of the Company.
The Board of Directors recommends the above appointment
/re-appointment.
The Company has received declaration from all the Independent Directors
of the Company confirming that they meet the criteria of independence
as prescribed both under Section 149 (6) of the Companies Act, 2013 and
under Clause 49 of the Listing Agreement entered into with the Stock
Exchanges.
Brief resume of the Directors proposed to be appointed/re-appointed as
stipulated under Clause 49 of Listing Agreement with the Stock
Exchanges are given in the Notice convening the 11th Annual General
Meeting.
Pursuant to the provisions of Section 203 of the Companies Act, 2013,
Mr. Hitesh S. Shah was appointed as Chief Financial Officer (CFO) of
the Company w.e.f. 14th August, 2014.
MEETINGS OF THE BOARD:
The Board meets at regular intervals to discuss and decide on Company/
business policy and strategy apart from other business. A tentative
annual calendar of the Board and Committee Meetings is informed to the
Directors in advance to facilitate them to plan their schedule and to
ensure meaningful participation in the meetings. However, in case of a
special and urgent business need, the Board's approval is taken by
passing resolutions through circulation, as permitted by law, which are
confirmed in the subsequent Board meeting.
The notice of Board meeting is given well in advance to all the
Directors of the Company. The Meetings of the Board are held in Mumbai,
Maharashtra. The agenda of the Board / Committee meetings is circulated
7 days, prior to the date of the meeting. The agenda for the Board and
Committee meetings includes detailed notes on the items to be discussed
at the meeting to enable the Directors to take an informed decision.
The Board met five times during the year, the details of which are
given in the Report on Corporate Governance.
The intervening gap between the two consecutive meetings was within the
period prescribed under the Companies Act, 2013.
AUDIT COMMITTEE AND ITS COMPOSITION
The Audit Committee of the Company reviews the reports to be submitted
with the Board of Directors with respect to auditing and accounting
matters. It also supervises the Company's internal control and
financial reporting process.
As on 31st March, 2015, the Audit Committee comprised of Mr. Sanjay
Nandu and Mr. Anish Shah, Independent Directors and Mr. Rajababu Kalla,
Whole-time Director of the Company.
Mr. Anish Shah is the Chairman of Audit Committee of the Company.
AUDITORS:
M/s. Deepak Maru & Co., Chartered Accountants, Mumbai (FRN: 115678W),
were appointed as Statutory Auditors of the Company at the last Annual
General Meeting held on 30th September, 2014 for a term of five
consecutive years. As per the provisions of Section 139 of the
Companies Act, 2013, the appointment of Auditors is required to be
ratified by Members at every Annual General Meeting.
Your Directors recommends the ratification by confirming the
appointment of M/s. Deepak Maru & Co., Chartered Accountants, Mumbai as
Statutory Auditors of the Company.
AUDITORS' REPORT:
With regards to the observations from the Statutory Auditors in their
report (on standalone financials), your directors would like to state
that:
I. The financial statement have been prepared on a "going concern"
basis, inspite the fact that the Company's financial
facilities/arrangements have expired and the same are overdue for
repayment and the net worth of the Company fully eroded and the lenders
have initiated legal proceedings against the Company for recovery.
Your Directors would like to state that considering the changes and new
developments taking place in the solar industry, your Directors are
optimistic about the better opportunity and turnaround of the Company.
The Company is hopeful and awaiting comprehensive package under BIFr
for resolution of debts from Banks and Financial Institutions.
II. The Company has not provided interest on unsecured loan amounting
to Rs. 233.07 lakhs (Previous year Rs. 154.33 lakhs) for the year ended
31st March, 2015. Had the same been provided the loss for the year
ending 31st March, 2015 will increase by Rs. 233.07 lakhs (Previous
year Rs. 154.33 lakhs) and the corresponding liability will also
increase by Rs. 233.07 lakhs as at 31st March, 2015 (Previous Year Rs.
154.33 lakhs).
In view of the heavy losses incurred by the Company since last many
years, the Company had requested its unsecured lenders that the Company
is not in a position to pay the interest on the loan amount. The
unsecured lenders has co operated with the Company and has considered
the request of the Company. In view of the present liquidity condition
of the Company, it is not possible to pay any interest on the unsecured
loans, hence provision for interest is not provided.
III. The Company has not provided for impairment or diminishing value
of its assets/investment as per 'Accounting Standard 28 - Accounting
for Impairment of Assets' as notified under the Companies (Accounting
Standards) Rules, 2006 read with the General Circular 15/2013 dated
13th September, 2013 of the Ministry of Corporate Affairs in respect of
Section 133 of the Companies Act, 2013. The effect of such Impairment
or diminishing value has not been quantified by the management and
hence the same is not ascertainable.
The management has a policy to maintain the assets and keep them in
working condition, so that its value does not get affected in long run.
The management is optimistic about realizing the value of its Assets /
Investments nearest to its carrying value, and there is no further
diminution in the value of its assets/investment other than
depreciation / amortization.
IV. The Company has accumulated losses at the end of the financial
year and at the immediately preceding financial year and the Company
has defaulted in repayment of loans and interest to the banks.
Your directors would like to state that the Company had working capital
shortages during the year and was unable to run the plants. Further the
plants which were operational during the year were also run at lower
capacity due to liquidity crunch, despite the demand of the products in
the market. The increasing cost and unabsorbed fixed costs resulted in
the cash losses during the year and in the course of time there were
defaults in the repayment of the loans and interest to the Banks.
However with the changing economic scenario, the growing solar industry
and increasing foreign investments in India, the management is hopeful
of arriving at a comprehensive business restructuring along with the
debt realignment proposal with the lenders under BIFR.
V. In respect of deposits accepted by the company before the
commencement of this Act, within the meaning of Section 74 & 75 of the
Act and the Rules framed there under to the extent notified, the
principal amount of such deposits and interest due thereon remained
unpaid even after expiry of one year from such commencement and the
Company has not filed a statement within a period of three months from
such commencement or from the date on which such payments, are due,
with the Registrar details as prescribed u/s.74(1)(a).
In absence of whole time company secretary the compliances were missed
out inadvertently.
VI. The Company has defaulted in repayment of loans and interests dues
to the banks and financial institution. The principal outstanding of
Term Loans and Cash Credit facilities amounts to Rs. 20,307.5* lakhs
and overdue interest amounts to Rs. 14,850.47 lakhs as at March 31,
2015, subject to reconciliation with the banks. The period of default
ranges around 51 months.
During the years 2011-2012 and 2012-2013, the Company had incurred
significant losses which had resulted in erosion of its net worth. The
severe fall in the prices of Solar Photovoltaic cells globally is on
account of reduced demand which resulted in large inventory at reduced
prices, leading to necessity for booking losses and thereby depleting
working capital. During the year 2011-2012, there was default in the
repayment obligations to banks and the relevant loan accounts viz. Term
Loans, Cash Credit Accounts and revolvement of letters of credit.
In the financial year 2012-2013, the Company on the basis of the
audited accounts for the financial year ended March 31, 2012, and being
mandatory, filed the reference u/s 15(1) of Sick Industrial Companies
(Special Provisions) Act, 1985 before the Hon'ble Board for Industrial
& Financial Reconstruction (BIFR). The above reference has duly been
registered by the learned Registrar of Hon'ble BIFR and hearings of
which are in the process for determination of sickness.
INTERNAL AUDIT:
The Company has appointed M/s. J. H. Ghumara & Co., Chartered
Accountants, Mumbai, as its Internal Auditor for the financial year
2014-15. The Internal Auditors have given their report to the Audit
Committee.
Based on the report of internal audit function the Board takes
corrective action in the specific areas observed and thereby to
strengthen the controls on significant audit observations, corrective
actions thereon are presented to the Audit Committee of the Board.
DIRECTORS' RESPONSIBILITY STATEMENT:
Your Directors, to the best of their knowledge and belief and according
to the information and explanations obtained by them and as required
under Section 134(3)(c) of the Companies Act, 2013 state that:
1. In the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures, if any;
2. The Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the company at the end of the financial year and of the loss of the
company for that period;
3. The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the company and
for preventing and detecting fraud and other irregularities;
4. The Directors have prepared the annual accounts on a going concern
basis;
5. The Directors have laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequate and were operating effectively; and
6. The Directors have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
PUBLIC DEPOSITS:
During the year under review, the Company has not accepted any deposits
within the meaning of Section 73 and 76 of the Companies Act, 2013 read
with Companies (Acceptance of Deposits) Rules, 2014.
EXTRACT OF ANNUAL RETURN:
An extract of Annual Return in Form MGT 9 is appended to this Report as
Annexure I.
LISTING OF SHARES:
The Equity shares of the Company are listed on National Stock Exchange
of India Ltd (NSE) and BSE Ltd (BSE). The Company is in process of
making arrangement for payment of listing fees to the said stock
exchanges for the financial year 2015-16.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION:
The Board has, on the recommendation of the Nomination & Remuneration
Committee framed a policy for selection and appointment of Directors,
Senior Management and determination of salary of Directors, Senior
Management Personnel and any other employees of the Company. The
Remuneration Policy is stated in the Report on Corporate Governance.
RISKS AND AREAS OF CONCERN:
The Company has laid down a well-defined Risk Management Policy
covering the risk mapping, trend analysis, risk exposure, potential
impact and risk mitigation process. A detailed exercise is being
carried out to identify, evaluate, manage and monitoring of both
business and non-business risk. The Board periodically reviews the
risks and suggests steps to be taken to control and mitigate the same
through a properly defined framework.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED
TO IN SECTION 188(1) OF THE COMPANIES ACT, 2013:
All Related Party Transactions entered during the year were in Ordinary
Course of the Business and on Arm's Length basis. No Related Party
Transaction were entered during the year by your Company as per Section
188 of the Companies Act, 2013 which requires approval of the members.
Accordingly, the disclosure pertaining to Related Party Transactions as
required under Section 134(3) of the Companies Act, 2013 in Form AOC-2
is not applicable.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186:
The details of loans, guarantee or investment made by your Company
under Section 186 of the Companies Act, 2013 during the financial year
2014-15 are given under Notes to Accounts of financial statements.
ANNUAL PERFORMANCE EVALUATION BY THE BOARD:
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, the Board has adopted a Policy for evaluation of
the performance of the Directors, Key Managerial Personnel and Senior
Management Personnel. Based on the consideration of various parameters,
gathered from all Directors, the performance of the Board and
individual Directors is evaluated. Besides, the Board has also
developed a system to evaluate the performances of each of executive
and non-executive and Independent Directors. Such questions are
prepared considering the business of the Company and the expectations
that the Board have from each of the Directors and the value addition
provided by them.
The Policy, inter alia, provides the criteria for performance
evaluation of Directors consisting of ;
I. Attendance of the Directors at the Meetings and the quality of
contribution at Board and it's Committee/s meetings;
ii. Participation of such Director in the company's business and
attribution to the strategic plans of the Management;
iii. Relationship with other Board members and other officials of the
Senior Management;
iv. Sharing of knowledge and experience for the benefit of the Company.
During the year under review, a separate meeting of the Independent
Directors was held for evaluation of performance of non-independent
Directors, performance of the Board as a whole and performance of the
Chairman.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR
COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S
OPERATIONS IN FUTURE:
There was no order passed by any regulator or court or tribunal, which
impacts the going concern status of the Company or will have bearing on
company's operations in future.
WHISTLE BLOWER POLICY:
The Company has a Vigil mechanism / Whistle Blower Policy to deal with
instance of fraud and mismanagement, if any. The mechanism also
provides for adequate safeguards against victimization of directors and
employees who avail of the mechanism and also provide for direct access
to the Chairman of the Audit Committee in the exceptional cases. The
details of the Vigil Mechanism Policy is explained in the Report on
Corporate Governance and also posted on the website of the Company. We
affirm that during the financial year 2014-15, no employee or Director
was denied access to the Audit Committee.
SECRETARIAL AUDIT REPORT:
Pursuant to the provisions of Section 204 of the Companies Act, 2013,
the Secretarial Audit Report received from M/s. Manish Ghia &
Associates, Company Secretaries, Mumbai is appended as Annexure - II
and forms part of this report.
With regards to the observations from the Secretarial Auditors in their
report, your directors would like to state that:
(a) As required under Section 203 of the Act the Company is yet to
appoint a Company Secretary;
The Company is in the process of appointment of whole-time Company
Secretary.
(b) In respect of outstanding deposits as at 31st March 2014, the
company was required to file Forms DPT-3 and DPT-4 latest by 30th June
2014 and 31st August 2014 respectively, which is yet to be filed;
In absence of whole time company secretary the compliances were missed
out inadvertently.
(c) On account of default in payment of interest/repayment of deposits
in the earlier financial years by the company, some of the directors of
the company are disqualified under section 164(2) of the Act;
The Company is facing liquidity crunch due to losses in the Company
since couple of years. The Company has also filed for registration u/s.
15(1) of the Sick Industrial Companies (Special Provisions) Act, 1985,
before the Hon'ble Board for Industrial & Financial Reconstruction, and
the hearings for determination of sickness are in process and will
arrive at the comprehensive package to settle the secured and unsecured
creditors.
(d) In respect of Directors appointed in the meeting of Board of
Directors held on 14th August 2014, the disclosures received from them
were not placed in the meeting for being taken note of; if the above
disclosures were placed in the said meeting as required under Section
184 of the Act, the company is required to file Form MGT-14 for the
resolution of board of directors passed thereof; the said form is to be
filed within 3* days from the date of board resolution with normal fee
or within a further period of 27* days with additional fee;
(e) There was a delay of 7 days in submission of Annual Report for the
year ended 31st March 2014 to the Stock Exchanges; and
(f) As required under clause 32 of the Listing Agreement, the details
of loans and advances have not been disclosed in the company's annual
report for the year ended 31st March 2014.
For point numbers (d), (e) and (f), in absence of whole time company
secretary the compliances were missed out inadvertently.
REPORT ON CORPORATE GOVERNANCE:
Pursuant to Clause 49 of the Listing Agreement entered into with the
stock exchanges, the following have been made a part of the Annual
Report and are attached to this report:
a. Management Discussion and Analysis
b. Report on Corporate Governance.
c. Auditors' Certificate regarding compliance of conditions of
Corporate Governance
COMMITTEES OF THE BOARD:
During the year, in accordance with the Companies Act, 2013, the Board
re-constituted some of its Committees. There are currently three
Committees of the Board, as follows:
Audit Committee
Stakeholders' Relationship Committee Nomination and Remuneration
Committee
Details of all the Committees along with their charters, composition
and meetings held during the year, are provided in the "Report on
Corporate Governance", a part of this Annual Report.
PARTICULARS OF REMUNERATION:
During the year under review, no employee was in receipt of
remuneration exceeding the limits as prescribed under provisions of
Section 197 of the Companies Act, 2013 and Rule 5(2) and 5(3) of
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014.
Disclosure with respect to the remuneration of Directors and employees
as required under Section 197 of the Companies Act, 2013 and Rule 5(1)
of Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 has been appended as Annexure III to this Report.
INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:
The Company has zero tolerance for sexual harassment at workplace and
adopted a Policy on prevention, prohibition and redressal of sexual
harassment at workplace in line with the provisions of the Sexual
Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013 and the Rules there under. There was no complaint
on sexual harassment during the year under review.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO:
As required under Section 134(3)(m) of the Companies Act, 2013, read
with the Companies (Accounts) Rules 2014, the information relating to
the foregoing matters is given as under:
Details regarding Conservation of Energy, Technology Absorption,
Foreign Exchange Earnings and Outgo is given in Annexure IV.
APPRECIATION:
Your Directors acknowledges with gratitude and wish to place on record,
their deep appreciation of continued support and co-operation received
by the Company from the various Government authorities, Shareholders,
Bankers, Lenders, Business Associates, Dealers, Customers, Financial
Institutions and Investors during the year.
Your Directors place on record their deep appreciation of the
dedication and commitment of your Company's employees at all levels and
look forward to their continued support in the future as well.
By Order of the Board of Directors
For Euro Multivision Limited
Place : Mumbai , Ralababnu Kalla
Date : August 14, 2015 Whole-Time Director
Registered Office:
F12, Ground Floor,
Sangam Arcade,
Vallabhbhai Road,
Vile Parle (West),
Mumbai 400 056
Mar 31, 2014
Dear members,
The Directors hereby present the 10th Annual Report together with the
Financial Statements of the Company for the financial year ended March
31,2014.
FINANCIAL RESULTS:
The performance of the Company for the financial year ended March
31,2014 is summarized as under:
(Rs. in Lakhs)
Particulars Year ended Year ended
March 31, 2014 March 31, 2013
Income from Operations 1169.20 1808.90
Miscellaneous Income 234.44 54.99
Increase / (Decrease) in stock (212.42) (37.92)
Total Income 1191.22 1825.97
Total Expenditure 1280.03 2894.63
Earnings Before Interest, (88.81) (1068.66)
Depreciation & Tax
Interest and Finance Charges 25.06 24.48
Depreciation 1901.91 1982.98
Profit / (Loss) Before Tax (2015.78) (3076.12)
Less: Provision for Deferred Taxation - -
Less: Excess Prior Year Tax Provision - -
Profit / (Loss) after Tax available (2015.78) (3076.12)
for appropriation
Add: Profit / (Loss) brought forward (13518.91) (10442.79)
from previous year
Balance Carried to Balance Sheet (15534.69) (13518.91)
FINANCIAL REVIEW:
The turnover of the Company for the year ended March 31, 2014, declined
by 35.36% and stood at Rs. 1169.20 Lakhs as against Rs. 1808.90 Lakhs
in the previous year. During the year under review, your Company
recorded total income of Rs. 1191.22 Lakhs as against Rs. 1825.97 Lakhs
in the previous year. The year under review was adversely affected due
to stressed working capital and liquidity crunch thereby affecting the
earning capacity of the company. This resulted in low turnover and
income in the year under review, thereby having a loss of Rs. 2015.78
Lakhs as against loss of Rs. 3076.12 Lakhs in the previous year.
PERFORMANCE REVIEW:
The performance during the year was not satisfactory due to various
reasons beyond the control of the Management. The products in which the
Company is dealing, is facing cut throat competition. The supply
pressure in the market is leading to the buyers'' market and price
erosion. At the same time, the costs have increased due to inflation in
the economy and devaluation of Rupee against the foreign currencies.
Due to this, the company is currently facing liquidity mismatch wherein
it is not generating enough cash flows to meet its debt obligations on
time.
Reductions in the subsidies and withdrawal of Government incentive
programmes in major European markets have generated a negative
sentiment for photovoltaic (PV) installations. At the same time huge
dumping by Chinese Solar Products manufacturers resulted in the fall in
prices. The severe fall in the prices of Solar Photovoltaic cells
globally on account of reduced demand resulted in the Company position
in very tragic condition wherein the Company is unable to stand in the
Competitive and Price sensitive market. As a result, the Company has
been unable to utilize its capacity and the cost of production of solar
cells continues to be higher than the prevailing market prices.
With the continued pledge and commitment across developed and
developing countries by the governments, towards renewable sources of
energy, demand for solar energy is expected to improve.
FUTURE PROSPECTS:
JNNSM guidelines stipulate that the certain grid connected Solar PV
plants in India needs to install the Indian made Solar Modules which
should contain Indian made Solar Cells. This will create the market for
Indian Solar cell Manufacturers to market their products. US and
European Union is also considering the possibility of imposing the anti
dumping duty against the solar products manufactured in China. They
moved in this direction and Us has imposed provisional anti dumping
duty on solar products manufactured in China. This will create the
market for all the global manufacturers other than Chinese one. You
Company has also envisages the huge potential of business opportunity
going ahead. However at the same time the challenges in the form of
adequate working capital, supply of products of prevalent quality and
product efficiency needs to be addressed by all the Indian players.
Indian Government is focused on the implementation of its various
programmes of promoting solar power generation under the various
schemes which are implemented at centre and state level. This will
create new business opportunities for the solar industry.
DIVIDEND:
In view of losses during the year under review, your Directors do not
recommend any dividend for the financial year 2013-14.
REFERENCE TO BIFR:
In the financial year 2012-2013, the Company on the basis of the
audited accounts for the financial year ended as on March 31, 2012, and
being mandatory, filed the reference U/s 15(1) of Sick Industrial
Companies (Special Provisions) Act, 1985 before the Hon''ble Board for
Industrial & Financial Reconstruction (BIFr). The above reference has
duly been registered by the Registrar of Hon''ble BIFR and hearings of
which are in the process for determination of sickness.
DIRECTORS:
In accordance with the provisions of Section 152 of the Companies Act,
2013, read with the Companies (Management and Administration) Rules,
2014 and the Articles of Association of the Company, Mr. Rajababu
Kalla, Whole-time Director of the Company, retires by rotation at the
ensuing Annual General Meeting and being eligible has offered himself
for re-appointment.
Mr. Anish Shah, Mr. Pravin Vira and Mr. Chandresh Shah were appointed
as Additional Directors of the Company w.e.f. July 27, 2013
Mr. Sanjay Nandu and Mr. Hansraj Gala were appointed as Additional
Directors of the Company with effect from August 14, 2014 and they
holds office upto the date of the ensuing Annual General Meeting. The
Company has received Notice under Section 160 of the Companies Act,
2013, along with required deposit, from a member proposing their
candidature for the office of Directors (Independent) of the Company.
The Board recommends for their appointment as Directors of the Company.
In terms of the provisions of Section 149 and 152 of the Companies Act,
2013 read with Companies (Management & Administration) Rules, 2014,
which become effective from April 1,2014, an Independent Director of a
Company can be appointed for a term of 5 consecutive years and shall
not be liable to retire by rotation. To comply with the above
provisions, it is proposed to appoint Mr. Anish Shah as an Independent
Director of the Company to hold office as such upto March 31,2019 and
Mr. Sanjay Nandu and Mr. Hansraj Gala as Independent Directors of the
Company to hold office as such up to August 13, 2019, who shall not be
liable to retire by rotation.
The Company has received declarations from all Independent Directors of
the Company confirming that they meet the criteria of independence as
prescribed under sub-section (6) of Section 149 of the Companies Act,
2013 and Clause 49 of the Listing Agreement entered with the Stock
Exchanges. Your Board recommends for their appointment as Independent
Directors of the Company in terms of the provisions of the Companies
Act, 2013.
Mr. Mahendra Modi, Mr. Anil Mandevia & Mr. Ajit Nalwaya has resigned
from the Directorship of the Company w.e.f. from July 29, 2013.
Mr. Chandresh Shah and Mr. Pravin Vira, Independent Directors of the
Company has resigned from the Directorship of the Company w.e.f. August
14, 2014. The Board place on record its sincere appreciation for their
valuable contribution made during their tenure as Directors of the
Company.
Brief resume of the Directors proposed to be appointed/re-appointed as
stipulated under Clause 49 of Listing Agreement with the Stock
Exchanges are given in the Notice convening the 10th Annual General
Meeting.
DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors
confirm to the best of their knowledge and belief that:
* In the preparation of the annual accounts, the applicable accounting
standards have been followed and there are no material departures,
except AS-28 Accounting for Impairment of Assets as notified under the
Companies (Accounting Standards) Rules, 2006.
* Appropriate accounting policies have been selected 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 as at March 31,2014 and losses of the Company for the year
ended on that date; <1> <1> Proper and sufficient care has been taken
for the maintenance of adequate accounting records in accordance with
the provisions of the Companies Act, for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities; and
* The annual accounts have been prepared on a going concern basis.
CORPORATE GOVERNANCE:
The Report on Corporate Governance along with the Auditors'' Certificate
regarding Compliance of the conditions of Corporate Governance and also
a Management Discussion and Analysis Report pursuant to Clause 49 of
the Listing Agreement have been made a part of the Annual Report and
are annexed to this report.
PUBLIC DEPOSITS:
The Company has neither accepted nor renewed any deposit from the
public within the meaning of Section 58A and 58AA of the Companies Act,
1956 read with Companies (Acceptance of Deposits) Rules, 1975 during
the year ended March 31,2014.
AUDITORS:
M/s. S. H. Bathiya & Associates, Chartered Accountants, Mumbai, the
retiring Auditors of the Company have expressed their unwillingness to
be re-appointed as the Auditors of the Company due to other
occupations. The Board of Directors recommend the appointment of M/s.
Deepak Maru & Co., Chartered Accountants, Mumbai as the Statutory
Auditors of the Company in place of M/s. S. H. Bathiya & Associates,
Chartered Accountants, to hold office from the conclusion of this 10th
Annual General Meeting till the conclusion of 15th Annual General
Meeting and to audit the financial statements for the financial year
2014-2015.
The Company has received a letter from M/s. Deepak Maru & Co.,
Chartered Accountants regarding their willingness to act as Statutory
Auditors of the Company. The Company has also received a Certificate
from them to the effect that their appointment, if made, would be in
compliance with the conditions as prescribed under Section 139 of the
Companies Act, 2013 and they satisfy the criteria as provided under
Section 141 of the Act.
AUDITORS'' REMARKS:
With regards to observations made by the statutory auditors in their
report, your directors would like to state that;
* The financial statement have been prepared on a "going concern"
basis, in spite the fact of erosion of net worth.
Considering the changes and new developments taking place in the solar
industry, we are hopeful of revival of the business of the company and
hence the accounts are prepared on going concern basis;
* The Company has not provided for interest on financing facilities
amounting to Rs. 4156.00 lakhs for the financial year under review; had
the same been provided, the loss will increase by Rs. 4156.00 lakhs and
the corresponding liability will also increase by Rs. 7820.50 lakhs.
The Company on the basis of registration filed u/s 15 (1) of Sick
Industrial Companies (Special Provisions) Act, 1985, before the Hon''ble
Board for Industrial & Financial Reconstruction, and the hearings of
which are in process for determination of sickness and therefore has
not provided for interest on financing facilities amounting to Rs.
4156.00 Lakhs.
* The Company has not provided for impairment on its assets as per
''Accounting Standard 28 -Accounting for Impairment of Assets'' as
notified under the Companies (Accounting Standards) Rules, 2006. The
effect of such impairment has not been quantified by the management and
hence the same is not ascertainable.
The Impairment of Assets have not been worked out due to highly
unstable and fluid economic values flowing in the solar power segment
and further, as restructuring of business is contemplated, which is
likely to impact the value of fixed assets and carry forward losses. On
completion of the restructuring exercise, the management will be in a
position to ascertain the Impairment of Assets.
* The Company has not provided interest on unsecured loan amounting to
Rs. 154.33 lakhs (Previous year Rs. NIL) for the year ended March
31,2014.
Had the same been provided the loss for the year ended March 31,2014
will increase by Rs. 154.33 lakhs (Previous year Rs. NIL) and the
corresponding liability will also increase by Rs. 154.33 lakhs as at
March 31,2014 (Previous Year Rs. NIL).
In view of the heavy losses incurred by the Company since last many
years, the Company had requested its unsecured lenders that the Company
is not in a position to pay the interest on the loan amount. The
unsecured lenders has co operated with the Company and has considered
the request of the Company. In view of the present liquidity condition
of the Company, it is not possible to pay any interest on the unsecured
loans, hence provision for interest is not provided.
PARTICULARS OF EMPLOYEES:
No employee was in receipt of remuneration exceeding the limits as
prescribed under the provisions of Section 217(2A) of the Companies Act
1956 read with Companies (Particulars of Employee) Rules 1975 as
amended, hence no such particulars are furnished.
PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND
FOREIGN EXCHANGE EARNINGS AND OUTGO:
(A) CONSERVATION OF ENERGY
Our manufacturing facility operates in Class 10000 (class 10000 clean
rooms, which enable us to produce clean, sterile, aseptic and dust-free
products and components) environment with antistatic work stations. The
plant is fully automated with least human intervention, which ensures
international quality standards with optimum utilization of installed
capacities.
The Company continues its efforts to reduce and optimize the use of
energy consumption by opting power effective replacements of equipments
and electrical installations.
(B) RESEARCH & DEVELOPMENT
The ongoing Research and development is carried out during the course
of production in the direction of production efficiency and quality
standards.
(C) TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION
Your Company had imported in the financial year 2004-05 and 2006-07,
and absorbed the technology from VDL ODMS, Netherlands for optical disc
unit, and imported in the financial year 2008-09 technology from OTB
Solar, Netherlands for its Solar Photovoltaic Cells unit. The
technology utilized provides consistency in production, productivity,
quality and reliability.
PERSONNEL
Your Company maintained cordial industrial relations in the year under
review.
ACKNOWLEDGEMENT
Your Directors sincerely record their appreciation with gratitude for
the continued support and assistance extended to the Company by the
Financial Institutions, Banks and various Government Departments and
Agencies.
The Directors places on record their deep appreciation of the
dedication and commitment of your Company''s employees at all levels and
look forward to their continued support in the future as well.
By Order of the Board of Directors
Rajababu Kallu
Whole-Time Director
Place : Mumbai
Date : August 14, 2014
Registered Office:
F 12, Ground Floor,
Sangam Arcade,
Vallabhbhai Road,
Vile Parle (West),
Mumbai - 400056
Mar 31, 2013
Dear Members,
The Directors hereby present the Ninth Annual Report together with the
Audited Accounts for the year ended March 31, 2013.
FINANCIAL RESULTS
The performance of the Company for the financial year ended March 31,
2013 is summarized as under:
(Rs. In Lakhs)
Particulars Year ended Year ended
March 31, 2013 March 31, 2012
Income from Operations 1808.90 6210.11
Miscellaneous Incom 54.99 37.84
Increase / (Decrease) in stock (37.92) (665.37)
Total Income 1825.97 5582.58
Total Expenditure 2894.63 8678.92
Earnings Before Interest,
Depreciation & Tax (1068.66) (3096.34)
Interest and Finance Charges 24.48 3443.28
Depreciation 1982.98 2683.33
Profit / (Loss) Before Tax (3076.12) (9222.95)
Less: Provision for Deferred Taxation
Less: Excess Prior Year Tax Provision 13.65
Profit after Tax available
for appropriation (3076.12) (9236.60)
Add: Profit / (Loss) brought
forward from previous year (10442.79) (1206.19)
Balance Carried to Balance Sheet (13518.91) (10442.79)
FINANCIAL REVIEW
The turnover for the year ended 31st March, 2013, declined by 71% and
stood at Rs. 1808.90 Lakhs as against Rs. 6210.11 Lakhs in the previous
year. During the year under review, your Company recorded total income
of Rs. 1825.97 Lakhs as against Rs. 5582.58 Lakhs in the previous year.
The year under review was adversely affected due to stressed working
capital and liquidity crunch thereby affecting the earning capacity of
the company. This resulted in low turnover and income in the year
under review, thereby having a loss of Rs.3076.12 Lakhs as against loss
of Rs.9236.60 Lakhs in the previous year.
PERFORMANCE REVIEW
Your Company is facing various challenges such as increased competition
from unorganized players and lower realization due to commoditization
of the business (in the Optical Disc Business) and subdued demand and
lower off take due to global slowdown (for the Solar Photovoltaic Cells
business). Due to this, the company is currently facing liquidity
mismatch wherein it is not generating enough cash flows to meet its
debt obligations on time.
Reductions in feed-in tariffs and other subsidies in major European
markets have generated a negative sentiment for photovoltaic (PV)
installations. This resulted in lower offtake for solar products
globally leading to reduced demand. This policy reversal was entirely
unanticipated by anyone and has taken the industry by surprise. The
severe fall in the prices of Solar Photovoltaic cells globally on
account of reduced demand resulting the company leaving with large
inventory at reduced prices, leading to necessity for booking losses
and thereby depleting working capital. As a result, the Company has
been unable to utilize its capacity and the cost of production of solar
cells continues to be higher than the prevailing market prices.
With the continued pledge and commitment across developed and
developing countries by the governments, towards renewable sources of
energy, demand for solar energy is expected to improve.
Power Plant
The Company had entered into a power supply agreement with Euro
Ceramics Ltd in the year 2006-2007 for generating the electricity. The
Company contributed one-fifth of the capital investment cost for
sharing of power generated by the Power Plant in the ratio of 80:20. In
addition to this, the Company also contributed on monthly basis for
operating expenses of running the Power Plant based on actual units of
power consumed by the Company.
As per the Deed of Modification dated 31st January, 2012 read in
conjunction with the Power Supply Agreement dated 2nd June, 2006, any
outstanding dues along with interest if not paid on or before 31st
December, 2012 to Euro Ceramics Ltd, the Power Supply Agreement would
stand terminated. And on the event of termination, firstly the security
deposit would be adjusted towards the outstanding dues and after
adjusting security deposit, for the balance amount the Company has to
transfer its share of 20% of investment at the book value of the power
plants assets to Euro Ceramics Ltd. On such termination, Euro Ceramics
Ltd would be legally and beneficially complete owner of the power
plant.
As per the above terms, during the year 2012-2013 outstanding dues
could not be paid by the Company to Euro Ceramics Ltd, hence as per the
letter of termination dated 1st January, 2013 from Euro Ceramics Ltd to
the Company, the security deposit was adjusted by Euro Ceramics Ltd
against the outstanding dues and also 20% share of assets of Power
Plant Building as owned by the Company was transferred to Euro Ceramics
Ltd. The Board of Directors in their meeting dated 10th November, 2012
noted such a failure to pay outstanding dues and subsequent adjustment
by Euro Ceramics Ltd. Accordingly, the said share of assets of Power
Plant cease to be owned by the Company and considered as a reduction
from the fixed assets block.
FUTURE PROSPECTS
The JNNSM guidelines stipulate that the entire grid connected Solar PV
plants in India coming under the scheme will have to use Solar PV
modules that are made in India. A sharp fall in solar panel prices has
brought down the cost of generating solar electricity considerably, and
industry participants hope that solar power will become competitive
with traditional sources of electricity over the next few years.
Indian manufacturers on the one hand witnessed steep fall in solar cell
prices and on the other hand market flooded with products from Chinese
and Taiwanese manufacturers.
The importance of sun in powering India''s economy and meeting energy
security requirements, we believe that India is being positioned
gradually and steadily for rapid growth in all the segments of the
solar/PV industry value chain, and will increasingly become an
important and high growth market for both on-grid and off-grid
applications in the days to come.
DIVIDEND
In view of losses during the year under review, your Directors do not
recommend any dividend for the financial year 2012-13.
REFERENCE TO BIFR
In the financial year 2012-2013, the Company on the basis of the
audited accounts for the financial year ended as on March 31, 2012, and
being mandatory, filed the reference U/s 15(1) of Sick Industrial
Companies (Special Provisions) Act, 1985 before the Hon''ble Board for
Industrial & Financial Reconstruction (BIFR). The above reference has
duly been registered by the learned Registrar of Hon''ble BIFR and
hearings of which are in the process for determination of sickness.
LITIGATION
During the year 2011-2012 and 2012-2013, the Company had incurred
significant losses which had resulted in erosion of its net worth. The
severe fall in the prices of Solar Photovoltaic cells globally on
account of reduced demand resulted the company leaving with large
inventory at reduced prices, leading to necessity for booking losses
and thereby depleting working capital. In the course of time in
2011-2012, there became default in the repayment obligations of banks
and the relevant loan accounts-Term Loans, Cash Credit Accounts and
devolvement of letters of credit.
Consequently the Company had received summons / notice from the office
of Debt Recovery Tribunal-II, Ahmedabad Gujarat in response of the
application filed by State Bank of India Baroda Gujarat vide O.A. No.
56/2012 for the recovery of their loan under Section 19 of the Recovery
of Debts due to Banks and Financial Institutions Act, 1993. The hearing
of the said case is in process.
The Company has received notices u/s 13(2) of Securitization &
Reconstruction of Financial Assets & Enforcement of Security Interest
Act, 2002 from ''The Cosmos Co-op Bank Ltd'' and State Bank of India for
recovery of its outstanding dues towards various credit facilities
extended to the Company from time to time. Further, State Bank of India
has taken symbolic possession of the immovable property of Optical Disc
and Solar Photovoltaic Cells Unit under the Securitization &
Reconstruction of Financial Assets & Enforcement of Security (Second)
Interest Act, 2002 and in exercise of the powers under Section 13(4) of
the said Act read with rule 8 of the security Interest (Enforcement)
rules 2002.
In the light of above scenario, all term loans from banks are no longer
treated as long term borrowings, but have been accounted as Current
Maturities of Long Term Borrowings in Other Current Liabilities in Note
No.7.
DIRECTORS
In terms of Section 256 of the Companies Act, 1956 read with Article
174 of Articles of Association of the Company, Mr. Raja Babu Kalla,
Director of the Company retires by rotation at the ensuing Annual
General Meeting and being eligible offers himself for re-appointment.
During the year under review Mr. Hitesh Shah  Managing Director has
resigned from the office of the Director of the Company w.e.f. August
14, 2012. The Board place on record its sincere appreciation for his
valuable contribution extended to the Company during his tenure as
Director of the Company.
Mr. Anish K. Shah, Mr. Pravin Vira and Mr. Chandresh Shah were
appointed as Additional Directors of the Company w.e.f. July 27, 2013.
In terms of Section 260 of the Companies Act, 1956, they hold office as
such upto the ensuing Annual General Meeting of the Company. The
Company has received notice in writing from member of the Company
pursuant to Section 257 of the Act, together with requisite deposit
proposing their candidature for the office of the Director of the
Company. Further Mr. Mahendra Modi, Mr. Anil Mandevia and Mr. Ajit
Nalwaya have resigned as Directors of the Company w.e.f. July 29, 2013.
Your Directors recommend the appointment of Mr. Anish K. Shah, Mr.
Pravin Vira and Mr. Chandresh Shah as Directors of the Company at the
ensuing Annual General Meeting of the Company.
On the basis of the written representations received from the Directors
as on March 31, 2013, taken on record by the Board of Directors, Mr.
Mahendra Modi, Mr. Ajit Nalwaya and Mr. Anil Mandevia are the Directors
disqualified, from being appointed as a Director in terms of Section
274(1)(g) of the Act.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors
confirm to the best of their knowledge and belief that:
- In the preparation of the annual accounts, the applicable accounting
standards have been followed and there are no material departures,
except AS-28 Accounting for Impairment of Assets as notified under the
Companies (Accounting Standards) Rules, 2006.
- Appropriate accounting policies have been selected 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 as at March 31, 2013 and losses of the Company for the year
ended on that date;
- Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
- At the end of the financial year 2012-2013, the Company had received
a cheque of Rs. 260.00 lacs as an unsecured loan and further the
Company had issued a cheque of Rs. 260.00 Lacs to a supplier for
procurement of materials. Both the respective cheques were dishonored
in the beginning of the subsequent year and hence effect of the said
dishonors is not been reflected in the financial statement prepared as
on 31st March, 2013.
- The annual accounts have been prepared on a Going Concern basis.
CORPORATE GOVERNANCE
The Report on Corporate Governance along with the Auditors'' Certificate
regarding Compliance of the conditions of Corporate Governance and also
a Management Discussion and Analysis Report pursuant to clause 49 of
the Listing Agreement is annexed hereto.
PUBLIC DEPOSITS
The Company has accepted deposits within the meaning of public deposits
under the provisions of section 58A read with Companies (Acceptance of
Deposits) Rules, 1975 in the nature of unsecured loans. The Company has
not accepted deposits within the meaning of public deposits under the
provisions of section 58AA.
AUDITORS
M/s. S. H. Bathiya & Associates, Chartered Accountants Statutory
Auditors of the Company hold office until the conclusion of the ensuing
Annual General Meeting and are eligible for re-appointment. The Company
has received letter from them to the effect that their re-appointment,
if made, would be within the prescribed limits under Section 224(1B) of
the Companies Act, 1956 and that they are not disqualified for such
re-appointment within the meaning of Section 226 of the said Act.
AUDITORS'' REPORT
With regards to observations made by the statutory auditors in their
report, your directors would like to state that;
- The financial statement have been prepared on a "going concernÂ
basis, inspite the fact of erosion of net worth
Considering the changes and new developments taking place in the solar
industry, we are hopeful of revival of the business of the company and
hence the accounts are prepared on going concern basis;
- The Company has not provided for interest on financing facilities
amounting to Rs. 3,664.50 lakhs for the financial year under review;
had the same been provided, the loss will increase by Rs. 3,664.50
lakhs and the corresponding liability will also increase by Rs.
3,664.50 lakhs.
The Company on the basis of registration filed u/s 15 (1) of Sick
Industrial Companies (Special Provisions) Act, 1985, before the Hon''ble
Board for Industrial & Financial Reconstruction, and the hearings of
which are in process for determination of sickness and therefore has
not provided for interest on financing facilities amounting to Rs.
3,664.50 Lakhs.
- The Company has not provided for the salary payable to employees
amounting to Rs. 8.35 lakhs; had the same been provided the loss will
increase by Rs. 8.35 lakhs and the corresponding liability will also by
Rs. 8.35 Lakhs.
The said amount has been paid during the financial year 2013-2014.
- The Company has not provided for impairment on its assets as per
''Accounting Standard 28 - Accounting for Impairment of Assets'' as
notified under the Companies (Accounting Standards) Rules, 2006. The
effect of such impairment has not been quantified by the management and
hence the same is not ascertainable.
The Impairment of Assets have not been worked out due to highly
unstable and fluid economic values flowing in the solar power segment
and further, as restructuring of business is contemplated, which is
likely to impact the value of fixed assets and carry forward losses. On
completion of the restructuring exercise, the management will be in
aposition to ascertain the Impairment of Assets.
- The Company has defaulted in repayment of dues to financial
institutions and payment of interest thereon.
During the year 2011-2012 and 2012-2013, the Company has incurred
significant losses which have resulted in erosion of its net worth. The
severe fall in the prices of Solar Photovoltaic cells globally on
account of reduced demand resulted the Company leaving with large
inventory at reduced prices, leading to necessity for booking losses
and thereby depleting working capital. As a result, the Company has
been unable to utilize its capacity and the cost of production of solar
cells continues to be higher than the prevailing market prices. In the
course of time there became default in the repayment obligations of
banks and the relevant loan accounts  Term Loans, Cash Credit Accounts
and devolvement of letters of credit.
- The payment of sales tax was outstanding for more than six or more
month. The Company has already paid the same in June 2013.
COST AUDITORS
Pursuant to the provisions of Section 233B of the Companies Act, 1956
and in terms of the Companies (Cost Accounting Records) Rules, 2011
dated June 3, 2011 issued by Central Government, the Company has
appointed M/s. M. S. Saiyed & Co., Practicing Cost Accountant as the
Cost Auditors of the Company for Audit of the cost accounting records
and to issue Compliance Certificate in terms of said Rules for the
financial year 2012-2013.
PARTICULARS OF EMPLOYEES
No employees were in receipt of remuneration exceeding the limits as
prescribed under section 217(2A) of the Companies Act 1956 read with
Companies (Particulars of Employee) Rules 1975 as amended, hence no
such particulars are furnished.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
(A) CONSERVATION OF ENERGY
Our manufacturing facility operates in Class 10000 (class 10000 clean
rooms, which enable us to produce clean, sterile, aseptic and dust-free
products and components) environment with antistatic work stations. The
plant is fully automated with least human intervention, which ensures
international quality standards with optimum utilization of installed
capacities.
The Company continues its efforts to reduce and optimize the use of
energy consumption by opting power effective replacements of equipments
and electrical installations.
(B) RESEARCH & DEVELOPMENT
The ongoing Research and development is carried out during the course
of production in the direction of production efficiency and quality
standards.
(C) TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION
Your Company had imported in the financial year 2004-05 and 2006-07,
and absorbed the technology from VDL ODMS, Netherlands for optical disc
unit, and imported in the financial year 2008-09 technology from OTB
Solar, Netherlands for its Solar Photovoltaic Cells unit. The
technology utilized provides consistency in production, productivity,
quality and reliability.
(D) FOREIGN EXCHANGE EARNINGS / OUTGO
The relevant information in respect of the foreign exchange expenditure
and earnings has been given in the Note no. 25(16) and 25(17) in the
Notes forming part of the accounts for the year ended on March 31,
2013.
PERSONNEL
Your Company maintained cordial industrial relations in the year under
review.
ACKNOWLEDGEMENT
Your Directors sincerely record their appreciation with gratitude for
the continued support and assistance extended to the Company by the
Financial Institutions, Banks and various Government Departments and
Agencies.
By Order of the Board of Directors
Place : Mumbai Rajababu Kalla
Date : August 13, 2013 Whole Time Director
Registered Office
209, Sangam Arcade,
Vallabhbhai Road, Opp.
Railway Station, Vile Parle
(West), Mumbai-400056
Mar 31, 2012
The Directors hereby present the Eighth Annual Report together with
the Audited Accounts for the year ended March 31,2012.
FINANCIAL RESULTS
The performance of the Company for the financial year ended March
31,2012 is summarized as under:
(Rs. In Lakhs)
Particulars Year ended Year ended
March 31,2012 March 31, 2011
Income from Operations 6210.11 9137.18
Miscellaneous Income 11.56 49.83
Increase / (Decrease) in stock (665.37) 767.19
Total Income 5556.30 9954.20
Total Expenditure 8678.91 9678.26
Earnings Before Interest,
Depreciation & Tax (3122.61) 275.94
Interest and Finance Charges 3417.01 1666.55
Depreciation 2683.33 2182.49
Profit / (Loss) Before Tax (9222.95) (3753.10)
Less: Provision for Deferred
Taxation - (638.52)
Less: Excess Prior Year Tax
Provision 13.65 _
Profit after Tax available for
appropriation (9236.60) (2934.58)
Add: Profit / (Loss) brought
forward from previous year (1206.19) 1728.39
Balance Carried to Balance Sheet (10442.79) (1206.19)
FINANCIAL REVIEW
The turnover for the year ended 31st March, 2012, declined by 47% and
stood at 6210.11 Lakhs as against Rs. 9137.18 Lakhs in the previous
year. During the year under review, your Company recorded total income
of Rs. 5556.30 Lakhs as against Rs. 9954.20 Lakhs in the previous year.
PERFORMANCE REVIEW
Your Company is facing various challenges such as increased competition
from unorganized players and lower realization due to commoditization
of the business (in the Optical Disc Business) and subdued demand and
lower off take due to global slowdown (for the Solar Photovoltaic Cells
Business). Due to this, the company is currently facing liquidity
mismatch wherein it is not generating enough cash flows to meet its
debt obligations on time.
Reductions in feed-in tariffs and other subsidies in major European
markets have generated a negative sentiment for photovoltaic (PV)
installations this year. This resulted in lower off take for solar
products globally leading to reduced demand. This policy reversal was
entirely unanticipated by anyone and has taken the industry by
surprise. The severe fall in the prices of Solar Photovoltaic cells
globally on account of reduced demand resulting the company leaving
with large inventory at reduced prices, leading to necessity for
booking losses and thereby depleting working capital. As a result, the
Company has been unable to utilize its capacity and the cost of
production of solar cells continues to be higher than the prevailing
market prices. All the above factors led to drastic fall in
realizations leading to lower than estimated EBIDTA.
With the continued pledge and commitment across developed and
developing countries by the governments, towards renewable sources of
energy, demand for solar energy is expected to improve.
FUTURE PROSPECTS
The JNNSM guidelines stipulate that the entire grid connected Solar PV
plants in India coming under the scheme will have to use Solar PV
modules that are made in India. A sharp fall in solar panel prices in
the second half of 2011 has brought down the cost of generating solar
electricity considerably, and industry participants hope that solar
power will become competitive with traditional sources of electricity
over the next few years.
Indian manufacturers on the one hand witnessed steep fall in solar cell
prices and on the other hand market flooded with products from Chinese
and Taiwanese manufacturers.
The importance of sun in powering India's economy and meeting energy
security requirements, we believe that India is being positioned
gradually and steadily for rapid growth in all the segments ofthe
solar/PV industry value chain, and will increasingly become an
important and high growth market for both on-grid and off-grid
applications in the days to come. There is a large scale over capacity
in the Industry and hence the present trend is expected to continue for
a year or so during which the Company is likely to face difficult
times.
POLYSILICON PROJECT EXPENSES WRITTEN OFF
As part of backward integration plan, the Company earlier had envisaged
setting up a manufacturing facility to manufacture Polysilicon for
which the company had entered into a Technology Transfer / License
agreement. The Company had incurred expenses amounting to Rs.1466.02
Lakhs towards technology transfer, engineering services and
pre-operative expenses for the same, which was earlier reflected under
capital work in progress.
The Company has decided to write off the said expenses so incurred due
to subdued demand and lower offtake and global slowdown of the solar
industry, since the Board of Directors are of the opinion, that it is
not viable for the Company in the current scenario to go ahead with the
polysilicon project.
DIVIDEND
Your Directors do not recommend any dividend for the financial year
under review.
REFERENCE TO BIFR
The Net worth of the Company is eroded as at the end of the Financial
Year under review. Accordingly the Directors have been advised that it
is mandatory to register and file a reference with the Board for
Industrial and Financial Reconstruction (BIFR) as required by the
provisions of the Sick Industrial Companies (Special Provisions) Act,
1985. Attention is invited on point 7(f) in Note 22 of notes forming
part of the accounts for the year ended on March 31,2012.
LITIGATION
The Company has received summons/notice from the office of Debt
Recovery Tribunal, Ahmedabad, Gujarat in response of the application
filed by State Bank of India Baroda Gujarat vide O.A. No. 56/2012 for
the recovery of their loan under Section 19 of the Recovery of Debts due
to Banks and Financial Institutions Act, 1993.
The Company has received a notice u/s 13(2) of Securitization and
Reconstruction of Financial Assets and Enforcement of Security Interest
Act, 2002 from the State Bank of India for recovery of its outstanding
dues towards various credit facilities extended to the Company from
time to time. The Company is now considering sustainable business model
with the various options to restructure its debt and capital base with
an objective to bring it at a serviceable level.
DIRECTORS
In terms of Section 256 of the Companies Act, 1956 read with Article
174 of Articles of Association of the Company, Mr. Anil Mandevia, the
Independent Director of the Company retires by rotation at the ensuing
Annual General Meeting and being eligible offers himself for
re-appointment.
In terms of provisions of section 260 of the Companies Act, 1956 the
following Directors namely, Mr. Mahendra Modi was appointed as
additional Director on the Board w.e.f. January 2,2012 and Mr. Rajababu
Kalla along with Mr. Ajit Nalwaya have been appointed as Additional
Directors w.e.f. June 8, 2012. Further, Mr. Pravin Gala, Mr. Deepak
Savla, Mr. Vinod Shah, Mr. Suresh Shah, Mr. Rayshi Shah have resigned
as the Directors of the Company w.e.f. January 2, 2012. Further Mr.
Nenshi Shah, Director has resigned from the Directorship of the Company
w.e.f. March 15, 2012. Mr. Chirag Shah, Executive Director and Mr.
Jatin Chhadva, Independent Director, who have also resigned from the
Company w.e.f. June 8,2012
All the appointments of the Directors of the Company are in compliance
with the provisions of Section 274 (1) (g) of the Companies Act, 1956.
A brief profile of directors, containing details of directors proposed
to be appointed / re-appointed is appended as an annexure to the notice
of ensuing annual general meeting.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors
confirm to the best of their knowledge and belief that:
- In the preparation of the annual accounts, the applicable
accounting standards have been followed and there are no material
departures, except AS 28 - quantification of impairment of assets
mainly due to highly unstable and fluid economic values flowing in the
solar power segment, which we understand will stabilize post anti
dumping and the concession and benefits as a Policy from the Government
on long term and stable basis.
- Appropriate accounting policies have been selected 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 as at March 31,2012 and losses of the Company for the year
ended on that date.
- Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities.
- The annual accounts have been prepared on a going concern basis, as
Per the explanation given in point 7(f) in Note 22 of notes forming part
of the accounts for the year ended on March 31,2012.
CORPORATE GOVERNANCE
The Report on Corporate Governance along with the Auditors' Certificate
regarding Compliance of the conditions of Corporate Governance as also
a Management Discussion and Analysis Report pursuant to clause 49 of
the Listing Agreement are annexed hereto.
PUBLIC DEPOSITS
Your Company has taken Public deposits within the meaning of Sections
58A and 58AA of the Companies Act, 1956, during the year under review.
The Company has filed a copy of statement in lieu of advertisement and
necessary particulars as required with the Registrar of Companies,
Mumbai.
AUDITORS
M/s. Swamy & Chhabra, Chartered Accountants, the retiring Auditors of
the Company have expressed their unwillingness to be reappointed as the
Auditors of the Company due to other occupations. The Board of
Directors recommend the appointment of M/s. S. H. Bathiya & Associates,
Chartered Accountants as the statutory Auditors of the Company in place
of M/s. Swamy & Chhabra, Chartered Accountants, to hold office from the
conclusion of the ensuing Annual General Meeting till the conclusion of
the next Annual General Meeting. M/s. S. H. Bathiya & Associates,
Chartered Accountants have expressed their willingness to act as
Auditors of the Company and has confirmed that their appointment, if
made, would be within limits under Section 224(1 B) of the Companies
Act, 1956.
AUDITORS'REPORT
1. With regard to Auditors' observations regarding non provision for
'impairment of its assets' as required under AS 28, your directors
would like to state that the impairment of assets have not been worked
out due to highly unstable and fluid economic values flowing in the
solar power segment and further, as restructuring of business is
contemplated, which is likely to impact the value of fixed assets and
carry forward losses. On completion of the restructuring exercise, the
management will be in the position to ascertain the impairment of
assets.
2. With regard to Auditors' observations regarding Company's status as
'going concern', your directors would like to state that considering
the changes and new developments taking place in the solar industry, we
are hopeful of revival of the business of the company and hence the
accounts are prepared on going concern basis.
3. With regard to Auditors' observations regarding default in
repayment of dues to financial institutions and payment of interest
thereon, your directors would like to state that during the year
2011-2012, the Company has incurred significant losses which have
resulted in erosion of its net worth. The severe fall in the prices of
Solar Photovoltaic cells globally on account of reduced demand resulted
the Company leaving with large inventory at reduced prices, leading to
necessity for booking losses and thereby depleting working capital. As
a result, the Company has been unable to utilize its capacity and the
cost of production of solar cells continues - to be higher than the
prevailing market prices. In the course of time there became default in
the repayment obligations of banks and the relevant loan accounts Term
Loans - Cash Credit Accounts and devolvement of letters of credit.
COST AUDITORS
Pursuant to the provisions of Section 233B of the Companies Act, 1956
and in terms of the Companies (Cost Accounting Records) Rules, 2011
dated June 3,2011 issued by Central Government, the Company has
appointed M/s. M. S. Saiyed & Co., Practicing Cost Accountant as the
Cost Auditors of the Company for Audit of the cost accounting records
and to issue Compliance Certificate in terms of said Rules for the
financial year 2011 -2012.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
(A) CONSERVATION OF ENERGY
The power requirements of our optical disc manufacturing unit is met
out of our co-owned captive power plant, which enables stable and
uninterrupted power supply which is crucial in manufacturing of our
products. Our manufacturing facility operates in Class 10000 (class
10000 clean rooms, which enable us to produce clean, sterile, aseptic
and dust-free products and components) environment with antistatic work
stations. The plant is fully automated with least human intervention,
which ensures international quality standards with optimum utilization
of installed capacities.
The Company continues its efforts to reduce and optimize the use of
energy consumption by opting power effective replacements of equipments
and electrical installations.
Particulars 2011-2012 2010-2011
Unit Rate Amount Unit Rate Amount
(Rs.
In
Lakhs) (Rs. In
Lakhs)
Captive Power Plant 4607360 4.01 186.01 10772350 3.98 427.15
Electricity Duty 0.40 21.18 0.40 39.43
Through DG set 235216 32.79 607389 70.70
Through Paschim
Gujarat Vij 5777730 5.66 326.88 2753790 169.36
Company Limited
Total 565.86 706.64
Less: Capitalized
for Solar - 76.34
Photovoltaic Cells
Unit
Total 565.86 630.30
(B) RESEARCH & DEVELOPMENT
The ongoing Research and development is carried out during the course
of production in the direction of production efficiency and quality
standards.
(C) TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION
Your Company had imported in the financial year 2004-2005 and
2006-2007, and absorbed the technology from VDL ODMS, Netherlands for
optical disc unit, and imported in the financial year 2008-2009
technology from OTB Solar, Netherlands for its Solar Photovoltaic Cells
unit. The technology utilized provides consistency in production,
productivity, quality and reliability.
(D) FOREIGN EXCHANGE EARNINGS I OUTGO
The relevant information in respect of the foreign exchange earnings
and outgo has been given in the Note no. 22(10) and 22(11) in the Notes
forming part of the accounts for the year ended on March 31,2012.
PERSONNELS
Your Company maintained cordial industrial relations in the year under
review.
ACKNOWLEDGEMENT
Your Directors sincerely record their appreciation with gratitude for
the continued support and assistance extended to the Company by the
Financial Institutions, Banks and various Government Departments and
Agencies.
For and on behalf of the Board of Directors
Hitesh Shah
Chairman & Managing Director
Place: Mumbai
Date : August 13, 2012
Registered Office
209, Sangam Arcade,
Vallabhbhai Road,
Opp. Railway Station,
Vile Parle (West),
Mumbai-400056
Mar 31, 2010
The Directors have pleasure in presenting the Sixth Annual Report
together with the Audited Accounts for the year ended March 31, 2010
Financial Results
The performance of the Company for the financial year ended March 31,
2010 is summarized as under:
(Rs. In Lakhs)
Year ended Year ended
Particulars
March 31, 2010 March 31, 2009
Income from Operations 5659.63 7321.67
Miscellaneous Income 15.56 19.07
Increase / Decrease in stock (258.00) 16.70
Total Income 5417.19 7357.44
Total Expenditure 3580.50 5300.30
Earning Before Interest,
Depreciation & Tax 1836.69 2057.14
Interest and Finance Charges 544.79 595.23
Depreciation 1171.96 1156.19
Profit / (Loss) Before Tax 119.94 305.72
Less: Provision for Tax / Fringe Benefit Tax 20.38 36.88
Less: Provision for Deferred Taxation (58.81) 47.07
Less : MAT Credit available for set off 75.34 38.02
Add : Excess Prior Year Tax Provision 1.29 -
Profit after Tax available for appropriation 81.74 183.74
Add:- Profit / (Loss) brought forward from
previous year 1646.66 1368.19
Add:- Adjustment as per transitional
provision of AS 11 (Net of tax Nil) - 94.73
Balance Carried to Balance Sheet 1728.40 1646.66
Financial Performance
During the year under review, your Company recorded total income of Rs.
5417.19 Lacs as against Rs. 7357.44 Lacs in the previous year. The
financial performance at the EBIDTA level was subdued with EBIDTA
declining by 10.72% as compared to the previous year. The pricing
pressure in the optical media storage industry has put strain on the
operations of your Company. Keeping pace with the changing dynamics of
the optical storage industry and striving in a very competitive market
your Company has still been able to perform well during the year.
To minimize the risk of the business model, your Company is
diversifying into the high growth Solar Photovoltaic industry. Your
Directors are hopeful of improving the results of the Company in the
upcoming years.
Brand Recognition
The Brand Eurovision is well recognized in the market. It is premium
brand amongst the recognized domestic brands in the optical storage
media industry. The Certification ISO 9001:2008 for Quality Management
System (QMS), Certification ISO 14001:2004 for Environment and OHSAS
18001:2007 for safety, has strengthened its image and has indirectly
contributed to the Companys productivity over the years.
Diversification
Your Company has moved forward and set up a Solar Photovoltaic Cell
manufacturing plant for generation of electrical energy, with a
capacity of 40MW per year at Taluka Bhachau, District Kutch, Gujarat.
This new field of business is synergistic with Companys existing
business and will leverage on its core competencies in the areas of
precision, high technology, mass manufacturing and project management.
This Solar Photovoltaic Cell plant is being set up in a sector specific
Special Economic Zone (SEZ) developed by the Company. Your Company had
made an application to the Gujarat State Government for setting up a
Special Economic Zone for Non Conventional Energy including Solar Energy
Equipments / Cell in an area of 11-63-47 hectares at Village: Shikara,
Taluka:Bhachau, District: Kutch, Gujarat on November 20, 2007. Your
Company had also made an application to the Central Government on
November 30, 2007 for the same.
On the basis of recommendation of the Special Economic Zone Development
Authority, the State Government had recommended the proposal to the
Government of India on July 1, 2008. On August 2, 2008 the Board of
Approvals, New Delhi formally approved your Companys application for
setting up the SEZ. Your Company got the formal approval from Ministry
of Commerce & Industry, Department of Commerce dated October 30, 2008.
Your SEZ was notified on April 23, 2009 and published in the Gazette of
India.
The Company has procured the Solar Photovoltaic Cell manufacturing
production line from OTB Solar B.V (Netherlands). The construction of
the building and erection of plant and machinery is in full swing and
the Board of Directors is confident that the company would have
achieved commercial production before we meet for the Annual General
Meeting.
The setting up of complex nature and complicated process of Solar
Photovoltaic Cell plant required high skill, perfection and dedication.
In this endeavour we thank all our suppliers of civil items,
contractors, architects, equipments and machinery suppliers, banks,
government institutions and departments and employees for creating a
team work and putting all their efforts for setting up the plant.
Initial Public Offering
The Company with a view to fund its Solar Photovoltaic Cell Plant came
out with the maiden Initial Public Offering (IPO) of 8800049 Equity
Shares of Rs. 10/- each for cash at a price of Rs. 75/- per equity
share aggregating to Rs. 6600 Lacs through 100% book building process.
The issue opened for subscription on September 22, 2009 and closed on
September 24, 2009 and was oversubscribed by 1.81 times. The shares
issued under IPO were allotted on October 7, 2009 and listed on October
15, 2009 on Bombay Stock Exchange Limited and National Stock Exchange
of India Limited. The total paid-up share capital after the said issue
is Rs. 2380 Lacs.
The Board takes this opportunity to thank the investors for their
overwhelming response to the Issue and the confidence reposed by them
in the Company.
Dividend
Your Directors have decided to conserve the internal resources for the
business requirements. Accordingly, your Directors do not recommend any
dividend for the financial year under review.
Directors
In terms of Section 256 of the Companies Act, 1956 read with Article
174 of Articles of Association of the Company, Mr. Pravin Gala and Mr.
Anil Mandevia, the Independent Directors of the Company retires by
rotation at the ensuing Annual General Meeting and being eligible offer
themselves for re-appointment. Further it is notified that the
designation of, one of our Directors, Mr. Suresh Shah is being changed
from Executive Director to Non-Executive Director with effect from
April 1, 2010.
All the appointments of the Directors of the Company are in compliance
with the provisions of Section 274 (1) (g) of the Companies Act, 1956.
A brief profile of directors, containing details of directors proposed
to be appointed / re-appointed is appended as an annexure to the notice
of ensuing annual general meeting.
Directors Responsibility Statement
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors
confirm to the best of their knowledge and belief that:
(a) In the preparation of the annual accounts, the applicable
accounting standards have been followed and there are no material
departures;
(b) Appropriate accounting policies have been selected and applied them
consistently and made judgements 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 2009-10 and profits of the
Company for the year ended March 31, 2010;
(c) Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 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.
Limited Liability Partnership
The Company has entered into a Limited Liability Partnership Agreement
in the name of "Solsys Koncepts LLP" a Limited Liability Partnership
firm registered under LLP Act, 2008 for the purpose of carrying on
business of offering concepts or to conceptualize and/or manufacture or
set up EPC projects for Solar farms, roof top installations, stand
alone solar installations, solar invertors, etc.
Corporate Governance
The Company has, pursuant to Clause 49 of the Listing Agreement with
Stock Exchanges, complied with the requirements of Corporate
Governance. A report on Corporate Governance and a certificate from the
auditors regarding the compliance of Corporate Governance conditions
are made part of this Annual report.
Management Discussion And Analysis
Management Discussion and Analysis on matters related to the business
performance, as stipulated under Clause 49 of the Listing Agreement,
with Stock Exchanges, is given as a separate section in the Annual
Report.
Public Deposits
Your Company has taken Public deposits within the meaning of Sections
58A and 58AA of the Companies Act, 1956, during the year under review.
The Company has filed a copy of statement in lieu of advertisement and
necessary particulars as required with the Registrar of Companies,
Mumbai.
Auditors
M/s. Swamy & Chhabra, Chartered Accountants, Statutory Auditors of the
Company, hold office until the conclusion of the ensuing Annual General
Meeting and are eligible for re-appointment. The Company has received
letter from them to the effect that their re-appointment, if made,
would be within the prescribed limits under Section 224(1B) of the
Companies Act, 1956 and that they are not disqualified for such
re-appointment within the meaning of Section 226 of the said Act.
Auditors Report
The observations made in the Auditors Report, read together with the
relevant notes thereon are self-explanatory and hence, do not call for
any comments under Section 217 of the Companies Act, 1956.
Energy Conservation, Technology Absorption And Foreign Exchange
(A) Conservation Of Energy
The power requirements of our optical disc manufacturing unit (CDRs,
DVDRs) is met out of our co-owned captive power plant, which enables
stable and uninterrupted power supply which is crucial in manufacturing
of our products. Our manufacturing facility operates in Class 10000
(class 10000 clean rooms, which enable us to produce clean, sterile,
aseptic and dust-free products and components) environment with
antistatic work stations. The plant is fully automated with least
human intervention, which ensures international quality standards with
optimum utilization of installed capacities.
The Company continues its efforts to reduce and optimise the use of
energy consumption by opting power effective replacements of equipments
and electrical installations.
2009-10
Particulars
Unit Rate Amount (Rs. In Lakhs)
Captive Power Plant 8516200 3.84 327.34
Electricity Duty - 0.40 34.06
Through DG set 1203246 10.49 126.29
9719446 487.69
(B) Research & Development
The ongoing research and development is carried out during the course
of production in the direction of production efficiency and quality
standards.
(C) Technology Absorption, Adaptation And Innovation
Your Company has imported and absorbed the technology from VDL ODMS,
Netherlands for optical disc unit. The technology utilised provides
consistency in production, productivity, quality and reliability. The
import of the said machinery was done in the financial year 2004-05 and
2006-07.
(D) Foreign Exchange Earnings / Outgo
The relevant information in respect of the foreign exchange earnings
and outgo has been given in the Notes forming part of the accounts for
the year ended on March 31, 2010.
Particulars Of Employees
Information in accordance with the provisions of Section 217 (2A) of
the Companies Act, 1956, read with the Companies (Particulars of
Employees) Rules, 1975 as amended, regarding employee is given in
Annexure "A" to this Directors Report.
Acknowledgement
Your Directors wish to place on record their appreciation for the
continued support and co-operation of the shareholders, banks, various
regulatory and government authorities, auditors, business associates,
and all the employees of the Company for their valuable contributions
received during the year under review.
For and on behalf of the Board of Directors
Nenshi L Shah
Chairman
Place : Mumbai
Date : May 31, 2010
Registered Office
Euro House, CTS No. 1406,A25/6,
Chincholi Bunder Road, Behind Inorbit Mall,
Malad (West), Mumbai-400064
Mar 31, 2009
The Directors have pleasure in presenting the Fifth Annual Report
together with the Audited Accounts for the year ended 31st March, 2009
FINANCIAL RESULTS
The summary of financial performance of Your Company during the year is
as under:
Particulars Year ended Year ended
31st March 2009 31st March 2008
(Rs. In Lacs) (Rs. In Lacs)
Income from Sales 7321.67 9092.46
Miscellaneous Income 19.07 4.55
Increase / Decrease in stock 16.70 (61.17)
Total Income 7357.44 9035.84
Total Expenditure 5300.30 5923.68
Earning Before Interest,
Depreciation & Tax 2057.14 3112.16
Interest and Finance Charges 595.23 872.07
Depreciation 1156.19 1081.29
Profit / (Loss) Before Tax 305.72 1158.80
Less: Provision for Tax / Fringe
Benefit Tax 36.88 135.69
Less- Provision for Deferred Taxation 47.07 354.67
Add : MAT Credit available for set
offLess : MAT Credit available
for set off 38.02 -
Add : Excess Prior Year Tax Provision, - 21.67
Profit After Tax 183:74 901.74
Less: Proposed Dividend - -
Less: Dividend Distribution Tax - -
Profit available for appropriation 183.74 901.74
Add:-Profit /(Loss) brought
forward from previous 1368.19 466.45
year
Add:- Adjustment as per transitional
provision of AS 94.73 --
11 (Net of tax Nil)
Balance Carried to Balance Sheet 1646.66 1368.19
During the year, your Company faced many challenges. The overall
downtrend in the global market coupled with the general over supply
position in the optical media storage industry has put pressure on the
operations of your Company. Consequently, In spite of these conditions
globally, your company was able to manage, and achieve total, sales of
Rs.7321.67 lacs which is lower to the extent of RS; 1770.79 Lacs, or
19.48%, from Rs.9092.46 Lacs in the fiscal year ended March 31, 2008
Consequently the profits have impacted significantly.
To derisk the business model, Your Company is diversifying into the
high growth photovoltaic industry.
PERFORMANCE HIGHLIGHTS
Your Company just completed its fourth year of commercial operations.
The plant is running to its full capacity. The combined capacity
utilization for the year 2008-09 was 88.42% for CDR. The combined
current capacity is now 180 millions CDR nos. per annum!
The Brand Eurovision is well recognized in the market. It is premium
brand amongst the recognized domestic brands in the optical storage
media industry. The Certification ISO 9001:2008 for Quality Management
System (QMS), Certification ISO 14001:2004 for Environment and OHSAS
18001:2007 for safety, has strengthened its image and has indirectly
contributed to its productivity.
DIVERSIFICATION PROJECT
Your Company has moved forward in setting up the Solar Photovoltaic
cell manufacturing facility used for generation of electrical energy.
This new field of business is synergistic with Companys existing
businesses and will leverage on its core competencies in the areas of
precision high technology, mass manufacturing, and project management.
Your Company is building the solar photovoltaic cell manufacturing unit
with a capacity of 40MW per year at Taiuka Bhachau, Dist-Kutch,
Gujarat. This photovoltaic plant is being set up in a Special Economic
Zone (SEZ) developed by the Company. Your Company acquired 28.75 acres
of land for setting up the SEZ adjacent to the existing manufacturing
unit at Bhachau, District Kutch, Gujarat. Further, your Company has
received its SEZ Notification on April 23, 2009 and the same Was
published in the Gazette of India. Plant located in SEZ would be
eligible from all applicable taxes and duties.
The company has procured the manufacturing production line from OTB
Solar B.V (The Netherlands). The Plant and Machinery have been received
in the months of November and December 2008.
The project had been appraised by State Bank of India, Industrial
Finance Branch, Marble Arch, Race Course Circle, Vadodara, Gujarat -
390007. The Company commenced its Civil Construction activity with
respect to its 40MW Photovoltaic Cell manufacturing Plant from 1st May,
2009.
SPECIAL ECONOMIC ZONE
Your Company had made an application to the Gujarat State Government
for setting up a sector specific Special Economic Zone for Non
Conventional Energy including Solar; Energy Equipments / Cell in -an
area of 11-63-47 hectares at Village:Shikara, Taluka:BHachau,
District:Kutch, Gujarat on 20th November 2007. Your Company had also
made an application to the Central Government on 30th November 2007 for
the same.
On the basis of recommendation of the Special Economic Zone Development
Authority the state Government had recommended the proposal to
Government of India on 1st July 2008. On 2nd. August 2008 the Board of
Approvals, New Delhi formally also approved your companys application
for setting up the special economic zone. Your Company got the formal
approval from Ministry of Commerce & Industry, Department of Commerce
dated October 30, 2008. Later your SEZ was notified on April 23, 2009
and published in the Gazette of India.
DIVIDEND
In view of ongoing diversification plans, the company would be in need
of financial resources: Hence the board of directors has decided to
conserve the internal resources in order to use the same for the
diversification project. Accordingly, the directors do not recommend
any dividend for the year ended March 31, 2009 The Directors submit
that this will increase shareholders value in long term.
DIRECTORS
In accordance with the provisions of the Companies Act, 1956 and the
companys Articles of Association, Mr. Deepak G: Savla and Mr. Jatin R.
Ghhadva Directors of the Company retire by rotation.
A brief profile of directors, containing details of directors proposed
to be appointed / re- appointed is appended as an annexure to the
notice of ensuing annual general meeting.
CORPORATE GOVERNANCE REPORT
Your Company is committed to uphold the highest standards of corporate
governance.
Your Company is not a listed Company, clause 49 related to Corporate
Governance of the listing agreement is not applicable to the Company.
Although a detailed report on Corporate Governance is given which forms
part of the Directors Report.
INITIAL PUBLIC OFFERING
In order to augment the funds for companys diversification programs to
be undertaken by the company and with a view to strengthen the
financial base, your company proposes to raise resource through Initial
Public Offer (IPO). Your company proposes to allot up to 88,00,000
Equity Shares to the various categories of investors in the initial
public offer by way of book building method under the Securities and
Exchange Board of India (SEBI) (Disclosure and Investor Protection
Guidelines), 2000 as amended from time to time ("DIP Guidelines"). The
process of IPO is at an advanced stage.
OBJECTS OF THE ISSUE
The objects of the Issue are
(1) To setup photovoltaic sqlar cell manufacturing unit
(2) Listing of our securities on Stock Exchanges
DEMATERIALIZATION OF SECURITIES WITH CDSL AND NSDL
Your Company has entered into an Agreement with the Central Depository
Services (India) Limited and National Securities DepositoryLimited for
dematerializatibh of equity shares in accordance with the provisions of
the DepositoriesAct 1996.
FIXED DEPOSITS
Your company has not accepted any fixed deposits from the public during
the year under review within the meaning of Section 58A and Section
58AA of the Companies Act, 1956:
AUDITORS
M/s. Swanriy & Chhabra, Chartered Accountants, Statutory Auditors of
the Company, hold office until the conclusion of the ensuing Annual
General Meeting and are eligible for re-appointment. The Company has
received letter from them to the effect that their re-appointment, if
made, would be within the prescribed limits under Section 224(1B) of
the Companies Act, 1956 and that they are not disqualified for such
re-appointment within the meaning of Section 226 of the said Act.
AUDITORS REPORT
The observations made in the Auditors Report, read together with the
relevant notes thereon are self-explanatory and hence, do not call for
any comments under Section 217 of the Companies Act, 1956.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
(A) CONSERVATION OF ENERGY
Your company has implemented the following measures for Energy
Conservation.
(1) At present there is one additional compressor for every two
production lines. Your Company is not using these compressors and its
has been observed that the quality is not affected. By doing this, your
company is saving 1200 KWH every day.
(2) Your company had tied up with an external agency of international
repute for Energy Audit. Energy audit is completed and their report is
awaited. On implementation of their report, there will be further
additional energy saving
(3) During break down/maintenance of power plant, your company is
managing with three DG Sets instead of four DG Sets by shifting
activities planned in day to night. This has resulted in lower
consumption of diesel, thus saving in energy.
(4) Every employee of Euro Multivision is given awareness training on
effective management of Electrical energy.
(B)RESEARCH & DEVELOPMENT
(1) Specific area where R&D is being carried out by the Company
The ongoing Research and development is carried out during the course
of production in the . direction of production efficiency and quality
standards.
(2) Benefits derived as results of the above R&D Not Applicable.
(3) Future Plan of Action
Your company would plan for any R&D requirement when it feels the need
for the same.
(4) Expenditure on R & D
Not applicable since the company does not have a separate R&D
Department.
(C) TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION
(i) Efforts. Your Company has imported and absorbed the technology form
the world leaders VDL ODMS, Netherlands.
(ii) Benefits: The benefits include consistency in production,
productivity, quality and reliability.
(iii) Imported Technology:
Technology Imported Your Company has imported the State-of the-art
assembly line from VDL ODMS, Netherlands: Your company has installed
ten assembly lines. Year of Import. Financial Year 2004-2005 and
2006-2007 Has the Technology Yes been fully absorbed.
ID) FOREIGN EXCHANGE EARNINGS / OUTGO
Your company has earned a foreign exchange of Rs.6.79 millions through
exports of its products. Your company has spent Rs.65.97 million on
account of Imports of Raw materials and Rs.43.25 million on account of
Import of Capital Goods. Your Company has also spent Rs.25.81 million
in Foreign Currency on travel and for other purposes.
PARTICULARS OF EMPLOYEES
Information in accordance with the provisions of Section 217 read with
the Companies (Particulars of Employees) Rules, 1975 as amended,
regarding employee is given in Annexure "A" to this Directors report.
DIRECTORS RESPONSIBILITY STATEMENT
As required under the provisions of Section 217 (2AA) of the Companies
Act, 1956, the Directors hereby confirm:
(i) that in the preparation of the Annual Accounts for the year ended
31st March 2Q09, the applicable accounting standards have been followed
along with proper explanation relating to material departures, if any;
(ii) that the directors had selected such accounting policies and have
applied them consistently and made judgments and estimates that were
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 ended 31st
March, 2009.
(iii) that proper and sufficient care has been taken 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 annual accounts for the year ended 31st March, 2009 have
been prepared on a going concern basis.
ACKNOWLEDGEMENT
Your Directors take this opportunity for thanking the Shareholders,
Bankers, Auditors, Business Associates, and all Employees of the
Company for their co-operation received during the year under review.
By Order of the Board of Directors
Nenshi L Shah
Chairman
Place : Mumbai
Date : 17th July, 2009
Registered Office
Boston House, Ground Floor,
Suren Road, Chakala,
Andheri (East),
Mumbai - 400 093