Home  »  Company  »  Flexituff Internatio  »  Quotes  »  Directors Report
Enter the first few characters of Company and click 'Go'

Directors Report of Flexituff International Ltd.

Mar 31, 2015

To The Members of Flex tuff International Limited

The Board of Directors presents its Twenty Second Directors' Report on Company's business and operations together with the Audited Financial Statements for the financial year ended 31st March 2015

FINANCIAL RESULTS AND APPROPRIATION

(Rs. in Millions)

Particulars Standalone Consolidated

2014-15 2013-14 2014-15 2013-14

Sales fr other Incomes 10571.63 9756.86 11821.16 10951.93

Profit before Interest, Depreciation % Tax 1242.98 1126.09 1261.99 1205.72

Profit before Tax 120.56 300.56 114.37 359.63

Profit for the year/ Balance available for Appropriation 197.62 127.70 188.04 183.04

Less: Appropriation

Proposed dividend on equity shares 8j tax 29.11 26.70 29.11 26.70

Surplus carried to Balance Sheet 168.51 101.00 158.93 156.33

1. STATE OF COMPANY'S AFFAIRS

During the period under review, on standalone basis, total revenue for the financial year 2014-15 at Rs. 10571.63 Million was higher against the total revenue of Rs. 9756.86 Millions in the previous year 2013-14. Company's profit before interest, depreciation and tax for the financial year 2014-15 stood at Rs. 1242.98 Million against Rs. 1126.09 Million in the previous year 2013-14.

On Consolidated basis, total revenue for the financial year 2014-15 at Rs. 11821.16 Million was higher against the total revenue of Rs. 10951.93 Million in the previous year 2013- 14. The profit before interest, depreciation and tax was Rs. 1261.99 Million against that of Rs. 1205.72 Million in the previous year.

2. DIVIDEND

Your Board is pleased to recommend a final dividend of 10% on the equity share capital of the Company i.e. Rs. l/-per equity share for the financial year 2014-15. The dividend, if approved by the shareholders in the Annual General Meeting, will be paid to the members within the time period stipulated by the Act.

During the year, no amount was transferred to General Reserves.

3. SHARE CAPITAL

The paid up equity share capital of the Company as on 31st March, 2015 was Rs. 24.88 Crore. During the year under review, the Company has not issued any sweat equity shares nor granted any Stock Options.

4. PARTICULARS OF LOAN, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered

under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the financial statements.

5. CREDIT RATING FOR BANKING FACILITIES

During the year under review, M/s. India Rating and Research Private Limited (Fitch Group) on the basis of audited financial statements of 31st March 2015, has assigned "IND A-" rating for long term debts and "IND A2 " for short term debts, which indicates "stable" outlook regarding timely servicing of financial obligations and is one notch above the previous year's rating.

6. AWARDS $ CERTIFICATIONS

During the year British Retail Consortium Certificate (BRC), ISO 14001:2004 (for Environmental Management), ISO 22000:2005 (for Food and Safety Management), OHSAS 18001:2007 (for Industrial Health and Safety) and ISO 9001:2008 (for Quality Management System) certifications were renewed.

7. SUBSIDIARIES /JOINT VENTURES/ ASSOCIATES

The Company has 2 subsidiaries as on March 31, 2015. There are no Associate Companies within the meaning of section 2(6) of the Companies Act, 2013. The Company during year 2014-15 made investment in three limited liability partnerships. The names of Companies which have become or ceased to be subsidiaries, joint ventures or associate Companies during the year are given in the Annexure C to this report.

Pursuant to the provisions of Section 129(3) of the Act, a statement containing salient features of the financial statements of the Company's subsidiaries in form AOC-1 is attached to the financial statements of the Company.

Pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited accounts in respect of subsidiaries, are available on the website of the Company.

The summaries of performance of the subsidiaries are given below:

M/s Nanofil Technologies Private Limited,

Nanofil Technologies Private Limited was incorporated as a private limited company under the Companies Act, 1956 in India on December 15, 2009 bearing CIN U25194WB2009PTC140211. The Company is engaged in the business of carrying on research and development by using various technologies namely Nanotechnology, Chemical technology, Biochemical Technology 8j Polymer Technology to use in polypropylene, polyethylene, PVC products, etc. The total sales and receipt of Nanofil was of Rs. 460.65 Million and profit of Rs. 6.26 Million for the financial year 2014-15.

M/s Flexiglobal Holdings Limited, Cyprus

Flexiglobal Holdings Limited was incorporated as a limited liability Company under Companies Law, Cap. 113 in Nicosia on September 22, 2008 bearing Registration No. HE 238405. Flexiglobal is a holding company for foreign investments. The total consolidated receipt of Flexiglobal was of 1,212 GBP and loss of 11,826 GBP for the financial year 2014-15.

7. EMPLOYEE STOCK OPTION SCHEME, 2011

The Nomination and Remuneration Committee of the Board of Directors of the Company inter alia monitors and administers the Employee stock option scheme of the Company.

The Company has only one scheme i.e., ESOP SCHEME 2011 and its details are as under-

Total No. of Options outstanding at 499800 beginning of the year

Less: Options lapsed due to various reasons 164550

Total Outstanding Options 335250

8. DIRECTORS /KEY MANAGERIAL PERSONNEL (KMPS) APPOINTMENT AND RESIGNATION

During the year under review, the following changes occurred in the position of Directors/ KMPs of the Company:

S. N. Name of Director/KMP Date of Event Event

1. Mr. K. K. Vijayvergiya 12th August,2014 Resignation from Directorship. (DIN 01941958)

2. Mr. D.K. Sharma 12th August, 2014 Appointment as Professional Executive Director in addition to Company Secretary.

(DIN 00028152) 4th November,2014 Resigned from post of Company Secretary.

3. Mr. Ajay Mundra 27th May, 2014 Appointed as Chief Financial Officer.

12th August, 2014 Resigned from post of Chief Financial Officer.

4. Mr. Dilip Parikh 12th August,2014 Appointed as Chief Financial Officer.

20th May, 2015 Resigned from post of Chief Financial Officer.

5. Mr. Rishabh Kumar Jain 4th November,2014 Appointed as Company Secretary

6. Mr. Manas Tandon 29th January, 2015 Resignation from Directorship. (DIN 05254602)

7. Mr. Ritesh Pandey 12th February, 2015 Appointed to fill casual vacancy. (DIN 07088000)

8. Mrs. Alka Sagar (DIN 07138477) 31st March, 2015 Appointed as an Additional Director

9. Mr. Manoj Dwivedi 31st March, 2015 Resignation from Directorship. (DIN 05290255)

The Board has placed on record its sincere appreciation for the contribution of Mr. K.K. Vijayvergiya (DIN 01941958), Mr. Manas Tandon (DIN 05254602) and Mr. Manoj Kumar Dwivedi (DIN 05290255), Mr. Ajay Mundra and Mr. Dilip Parikh towards the progress of the Company during their tenures.

In accordance with the provisions of the Companies Act, 2013 and in terms of the Articles of Association of the Company Mr. D.K.

Sharma, Professional Executive Director of the Company, retire by rotation and being eligible for re-appointment offers himself for re-appointment.

In compliance with the Companies Act, 2013, Mr. Anirudh Sonpal (DIN 03367049), Mr. Sharat Anand (DIN 00083237) and Mr. Kevan

John Upperdine (DIN 01214264) were appointed as Independent Directors by the members at their 21st Annual General Meeting held on 30th September, 2014 for a period of 5 years.

9. DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have declared and affirmed their compliance with the independence criteria as mentioned in Section 149(6) of the Companies Act, 2013 and clause 49 of the Listing Agreement.

10. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, a formal evaluation of the Board was carried out by independent directors, after taking into consideration of the various aspects of the Board's functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance.

The performance evaluation of the Independent Directors was done by the entire Board of Directors, excluding the director being evaluated on the basis of their performance of specific duties and obligations and governance.

Further there is no re-appointment of Independent Directors due for this Annual General Meeting.

11. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION

The Nomination and Remuneration Committee of Board of Directors of the Company leads the process for appointment of Directors and Key Managerial and Senior Management personnel in accordance with the requirements of the Companies Act, 2013, Listing Agreement and other applicable rules. In case of re-appointment of Independent Directors, the Board shall take into consideration the results of the performance evaluation of the Directors and their engagement level.

Company does have Policy on Appointment and Remuneration of Directors, KMPs and Senior Management personnel and which is available on the website of the Company i.e., www.flexituff.com

12. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism to support the Code of Business Ethics. This mechanism documents the Company's commitment to maintain an open work environment in which employees are able to report instances of unethical or undesirable conduct, actual or suspected fraud or any violation of Company' s Code of Conduct without fear of intimation or retaliation.

The said is given at the website of the Company on below link: http://flexituff.com/Investor/Code%20of%20Conduct/ vigil%20mechanism.pdf

13. RISK MANAGEMENT

The Board of Directors is overall responsible for identifying, evaluating and managing all significant risks faced by the Company. The Board monitors and reviews the implementation of various aspects of the Risk Management by approving Risk Management Report in the meeting of Audit Committee and Board thereon on quarterly basis to manage key risks across the organization.

14. RELATED PARTY TRANSACTIONS

All transactions entered with Related Parties for the year under review were on arms length basis and in the ordinary course of business and the provision of Section 188 of the Companies Act, 2013 are not attracted. Thus disclosure in form AOC-2 is not required and hence not attached. Further, there are no material related party transactions during the year under review with the Promoters, Directors, key managerial personnel or any related party.

15. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

16. AUDITORS STATUTORY AUDITORS

M/s. L.K. Maheshwari 8j Co., Chartered Accountants, Indore were appointed as Statutory Auditors of the Company in the 21st Annual General Meeting (AGM) of the Company held on 30th September, 2014 for a term of three consecutive years, subject to ratification of their appointment by shareholders at every AGM. Board of Directors in its meeting held on 7th August, 2015 has proposed ratification of their appointment by the shareholders in the ensuing Annual General Meeting.

Board of Directors on recommendation of Audit Committee of the Board appointed M/s MZSK % Associates, Chartered Accountants, as Joint Statutory Auditor for Financial Year 2015-16 in its meeting held on 7th August, 2015 subject to approval of members in ensuing Annual General Meeting of the Company. M/s. MZSK 8j Associates, Chartered Accountants, Mumbai have given their consent to act as a Joint Statutory Auditors of the Company. AUDITOR'S REPORT

The observations made in the Auditor's Report, read with the relevant notes thereon are self explanatory and hence do not calls for any further comment pursuant to Section 134 of the Companies Act, 2013.

SECRETARIAL AUDIT

Pursuant to provisions of Section 204 of the Companies Act,

2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, M/s. Ritesh Gupta 8j Company, Practicing Company Secretary were appointed as Secretarial Auditor for conducting secretarial audit for the financial year 2014-15. The report of the Secretarial Auditor is annexed herewith as Annexure E 8j its self explanatory hence do not call for any further comments pursuant to Section 134 of the Companies Act, 2013.

COST AUDIT

Members of the Company appointed M/s. Vijay P. Joshi 8j Associates, Cost Accountants as Cost Auditors of the Company for the financial year 2014-15. However, further amendments in Companies (Cost record and Audit) Rules, 2014 waived off the requirement of cost audit on the Company. Hence there was no cost audit carried on for the financial year 2014-15.

17. DETAILS OF MEETINGS OF THE BOARD

During the year five Board Meetings were convened and held. The details of which are given in the Corporate Governance Report.

18. AUDIT COMMITTEE

The Company has constituted Audit Committee, pursuant to the provisions of Section 177 of the Companies Act, 2013 and provisions of the Listing Agreement. The Composition, Scope and Powers of Audit Committee together with details of meetings held during the period under review forms part of Corporate Governance Report.

19. CORPORATE SOCIAL RESPONSIBILITY

During the period under review, the Board of Directors on recommendation of the CSR Committee formulated a CSR policy. The CSR activities of the Company are implemented in accordance with the CSR policy and provisions of the Companies Act, 2013 and rules made there under.

The Annual Report on CSR containing particulars specified in Companies (CSR Policy) Rules, 2014 including initiatives taken by the Company during the year is given in Annexure B along with contents of CSR Policy of the Company. The said policy is also placed on the website of the Company under following link: http://fiexituff.com/investor_conduct.

20. PUBLIC DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the rules made there under.

21. CODE OF CONDUCT

The Board has laid down a code of conduct for all Board members and Senior Management Personnel of the Company as per Clause 49 of the Listing Agreement. All the Directors and Senior Management Personnel have affirmed compliance with the said code of conduct for the year ended 31st March, 2015. The same is posted on the website of the company i.e., www.flexituff.com

22. DISCLOSURE ON REMUNERATION

The information required pursuant to Section 197(12) of the Companies Act, 2013 and rule made there under are forming part of this Directors' Report for the year ended March 31, 2015 is given as a separate Annexure to this report.

The above annexure is not sent along with this report to the Members of the Company in line with the provision of Section 136 of the Companies Act, 2013. Members who are interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company. The aforesaid Annexure is also available for inspection by members at the registered office of the Company, 21days before the 22nd Annual General Meeting and up to the date of the ensuing Annual General Meeting during the business hours on working days.

None of the employees listed in the said Annexure is a relative of any Director of the Company. None of the employees hold (by himself or along with his spouse and dependent children) more than two percent of the equity shares.

23. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO

These fields continue to be the areas for improvement and of maj or progress. Keeping in view the escalation in energy cost, our organization is continuously endeavoring to find new and better ways for optimization of energy cost in its various manufacturing operations.

In compliance with Section 134 of the Companies Act, 2013, read with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988, statement giving information regarding Energy Conservation, Technology Absorption and Foreign Exchange earnings and out go is given in Annexure A forming part of this Annual Report.

24. DIRECTORS' RESPONSIBILITY STATEMENT

The Directors confirm that:

1. In the preparation of annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures.

2. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period.

3. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. The Directors had prepared the annual accounts on a going concern basis.

5. The Company has established internal financial controls and the said controls are adequate and are operating effectively.

6. A proper compliance system is established to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

25. INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

The Company has put in place an adequate system of internal financial control commensurate with its size and nature of business which helps in ensuring the orderly and efficient conduct of its business. These systems provide a reasonable assurance in respect of providing financial and operational information, complying with applicable statutes, safeguarding of assets of the Company, prevention 8j detection of frauds, accuracy 8j completeness of accounting records and ensuring compliance with corporate policies. As a means to further strengthen the control environment, during the year, the processes were benchmarked with industry practices to identify the gaps, if any and remedial measures were taken.

The Company has an Internal Audit Department with a dedicated internal audit team which is commensurate with the size, nature 8j complexity of operations of the Company. The Internal Audit Report is submitted to the Audit Committee on quarterly basis, the Audit Committee reviews the performance of internal audit function.

The Audit Committee, reviews adherence to internal control systems and internal audit reports. Further, the Board annually reviews the effectiveness of the Company's internal control system.

26. REPORT ON CORPORATE GOVERNANCE

As required under Clause 49 of the Listing Agreement with the Stock Exchanges, the Corporate Governance Report forms part of the Annual Report. Your Company is in full compliance with the requirements and disclosures as stated therein. A certificate from the Practicing Company Secretary confirming compliance of the Corporate Governance is appended to the Report on Corporate Governance.

27. REPORT ON MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis forms part of this Annual Report for the year ended 31st March, 2015

28. DEMATERIALISATION AND ELECTRONIC REGISTRAR

The equity shares of your Company are available for dematerialization with both NSDL and CDSL under ISIN INE060J01017. As on 31st March 2015, 95.47% equity shares are in Demate form and remaining 4.53 % equity shares are in physical form.

Our registrar for electronic connectivity with the National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL) is M/s Link In time India Private Limited, Mumbai (Formerly M/s In time Spectrum Registry Limited).

29. HUMAN RESOURCE MANAGMENT AND INDUSTRIAL RELATIONS

Human Resource plays vital role in your company. If finance is the blood of any organization then Human Resource is not less than pulse which keeps running production by their hard work day and night. Your company has performance management process to motivate people to give their best output and encourages innovation and meritocracy. Board places on record their appreciation and sincere thanks towards their contribution to the Company's performance during the year.

The Board is pleased to inform you that Industrial relations have continuously been cordial at all levels throughout the year.

30. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company has always believed in providing a safe and harassment free workplace for every individual working in Flexituff International Limited's premises. The Company always endeavors to create and provide an environment that is free from discrimination and harassment including sexual harassment.

The Company has in place a robust policy on prevention of sexual harassment at workplace. The policy aims at prevention of harassment of employees for identification, reporting and prevention of sexual harassment. There is an Internal Complaints Committee (ICC) which is responsible for redressal of complaints related to sexual harassment and follows the guidelines provided in the policy. ICC has its presence at corporate office as well as at plant locations.

During the year ended 31st March, 2015. There were no complaints pertaining to sexual harassment.

31. RELEVANT EXTRACT OF THE ANNUAL RETURN

Relevant extract of annual return for the financial year 2014- 15 under the Companies Act, 2013 is given in Annexure D to this Report.

32. MATERIAL CHANGES AND COMMITMENTS

No material changes and commitments, affecting the financial position of the Company have occurred after the end of the financial year 2014-15 and till the date of this report.

APPRECIATION

The Board takes this opportunity to express its sincere appreciation for the excellent support and cooperation received from company's bankers, investors, customers, suppliers, statutory authorities for their consistent support to the Company.

The Directors also sincerely acknowledge the outstanding support and services of the workers, staff and executives of the Company, which have together contributed to the efficient operations and management of the Company.

For And On Behalf of The Board

Sd/- Sd/-

Whole Time Director Whole Time Director

Place: Pithampur

Date: 07/08/2015


Mar 31, 2014

The Members,

The Board of Directors presents its Twenty first Directors'' Report on Company''s business and operations together with the Audited Financial Statements for the financial year ended 31st March 2014.

FINANCIAL RESULTS AND APPROPRIATION

(r in Million)

Particulars Standalone Consolidated 2013-14 2012-13 2013-14 2012-13

Sales & other incomes 9756.86 8623.77 10951.93 9690.49

Profit before interest, depreciation & Tax 1126.09 1211.98 1205.72 1252.17

Profit before Tax 300.56 368.12 359.63 350.77

Profit after Tax 228.06 276.36 283.41 254.96

Profit for the year/ Balance available for Appropriation 127.70 276.36 183.04 254.96

Less: Appropriation

Proposed dividend on equity shares & tax 26.70 25.28 26.70 25.27

Equity dividend and tax of earlier year 0 0.02 0 0.02

Surplus carried to Balance Sheet 101.00 251.06 156.33 229.65

FINANCIAL PERFORMANCE HIGHLIGHTS

During the period under review, Standalone Sales and other incomes of the Company stood at Rs.9756.86 Millions as against that of Rs.8623.77 Millions in the previous year showing a growth of 13.14%. Company''s Profit before interest, depreciation and tax stood at Rs.1126.09 Millions as against to Rs.1211.98 Millions in the previous year.

The Consolidated Sales and other incomes of the Company stood at Rs.10951.93 Millions as against that of Rs.9690.49 Millions in the previous year showing a growth of 13.02%. Company''s Consolidated Profit after tax (PAT) increased by 11.16% i.e. from Rs.254.96 Millions in the previous year to Rs.283.41 Millions.

EXPORT SALES

The Company recorded a growth of 22.29% in export sales from Rs.4802.74 Million in the previous year to Rs.5873.31 Million this year.

DIVIDEND

Your Board is pleased to recommend a dividend of 10% on the equity share capital of the Company i.e. Rs.1/- per equity share for the financial year ended 31st March, 2014. The dividend, if approved, will be paid to the members within the time period stipulated by the Act.

CREDIT RATING FOR BANKING FACILITIES

M/s Credit Analysis & Research Limited (CARE) on October 16, 2013 has reaffirmed CARE BBB (Triple B ) credit rating for Long Term Facility and CARE A3 for Short Term Facility which indicates moderate degree of safety regarding timely servicing of financial obligations.

PRIVATE PLACEMENT AND FCCB ISSUE

Company has issued and allotted 1902173 Equity Shares on Preferential Basis under Private Placement, at a price of Rs.230/- per Equity Share inclusive of premium of Rs.220/- per Equity Share to International Finance Corporation on 30th December, 2013.

Company has further issued 5.34% Foreign Currency Convertible Bonds (the "FCCBs") amounting to USD 9 Million to nternational Finance Corporation. These FCCBs are convertible at the option of Bondholder into fully paid up equity shares of the Company at a price of Rs.230/- per equity share on or before 30th January, 2019.

AWARDS & CERTIFICATIONS

During the year both the Prestigious Food Grade Certificate i.e. American Institute of Baking Certificate (USFDA) and British Retail Consortium Certificate (BRC) were renewed.

Besides certification above your Company is accredited by ISO 14001:2004(for Environmental Management), ISO 22000:2005 (for Food and Safety Management), ISO 18001:2007 (for Industrial Health and Safety) & ISO 9001-2008 (for Quality Management System) certifications.

Your Company is a major exporter of FIBC and woven products from India and has received the Top Exporter Award from the PLEXCOUNCIL, Ministry of Commerce from 2005-06 to 2011- 12.

SUBSIDIARIES

Your Company has two direct subsidiaries and two steps down subsidiaries. None of the subsidiaries have a negative net worth.

Subsidiaries

M/s Nanofil Technologies Private Limited, Kolkata M/s Flexiglobal Holdings Limited, Cyprus (During the year Company has disinvested from M/s Satguru Polyfab Private Limited, Gandhidham)

Step- down Subsidiaries

M/s Flexiglobal (UK) Limited, UK M/s Lakshmi Incorporated, USA

The financial details of the subsidiary companies as well as the extent of holdings therein are provided in a separate section of this Annual Report.

The Ministry of Corporate Affairs has, vide General Circular No 2/2011 dt. 8th February, 2011, granted general exemption for not attaching the annual accounts of the subsidiary companies with the annual accounts of holding company.

Pursuant to the said circular, the Board of Directors of your company in their meeting held on 27th May, 2014 has given its consent, for not attaching the Annual Accounts of the Subsidiary Companies with that of the Holding Company, instead has published the audited consolidated financial statements in the Annual Report. Accordingly, the annual accounts of Subsidiary Companies and all other documents required to be attached under Section 212(1) of the Companies Act, 1956 to the Balance Sheet of the Company shall not be attached. However, these documents shall be made available upon request by any member of the Company interested in obtaining the same and shall also be kept for inspection at the Registered Office of your Company and that of Subsidiary Companies concerned Further, the financial data of the Subsidiary Companies has been furnished along with the statement pursuant to section 212 of the Companies Act, 1956 forming part of this Annual Report.

EMPLOYEE STOCK OPTION SCHEME, 2011

The updates on the stock options are as under:

Total No. of Options outstanding at beginning 799300 of the year

Less: Options lapsed due to various reasons 299500

Total Outstanding Options499800

DIRECTORS

Mr. Saurabh Kalani and Mr. Manoj Kumar Dwivedi, Whole time directors are liable to retire by rotation and being eligible offers themselves for re-appointment. The board recommends their re-appointment for your approval Mr. D.K. Sharma, Asstt. Vice President- Corporate Affairs & Company Secretary has been appointed as an additional director by Board of Directors of the Company at their meeting held on 12th August, 2014. He was appointed as an Executive

Director in the same meeting. He is liable to retire by rotation

Mr. Kaushal Kishore Vijayvergiya also tendered his resignation which was accepted by Board of Directors w.e.f. 12th August, 2014. Board wish to place on record sincere appreciation for his contribution towards the progress of the company during his tenure.

AUDITORS

M/s. L.K. Maheshwari & Co., Chartered Accountants, was appointed as Joint Statutory Auditors of the Company vide Extra Ordinary General meeting held on 11th March, 2014. Further M/s. BSR & Co. LLP, Chartered Accountants resigned from Statutory Auditor of the Company w.e.f. 14th May, 2014.

Company has received a certificate from M/s L.K. Maheshwari & Co., Chartered Accountants, regarding their eligibility for appointment as Statutory Auditors of the Company till the conclusion of three consecutive Annual General Meetings (subject to ratification of the appointment by the members at every AGM held there after) and matter of their re-appointment has been proposed for approval of members of the Company.

The board recommends the appointment of M/s L.K. Maheshwari & Co., Chartered Accountants, as Statutory Auditors of the Company.

AUDITOR''S REPORT

The observations made in the Auditor''s Report, read with the relevant notes thereon are self explanatory and hence do not call for any further comments under Section 134 of the Companies Act, 2013.

AUDIT COMMITTEE

The Company has constituted Audit Committee, pursuant to the provisions of Section 177 of the Companies Act, 2013 and provisions of the Listing Agreement. The Composition, Scope and Powers of Audit Committee together with details of meetings held during the period under review forms part of Corporate Governance Report.

COST AUDITOR

During the year your Company has appointed M/s Vijay P. Joshi & Associates, Indore as Cost Auditor of the Company.

PUBLIC DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the rules made there under.

CODE OF CONDUCT

The Board has laid down a code of conduct for Members of the Board and Senior Management personnel of the Company. Members of the Board and Senior Management have affirmed compliance with the said code of conduct for the Financial Year 2013-14.

INDUSTRIAL RELATIONS

The Board is pleased to inform you that Industrial relations have continuously been cordial at all levels throughout the year. The Board of Directors place on record their deep appreciation for the sincere, devoted and dedicated team work of all employees at all levels to meet the quality, cost and delivery requirements of the customers

PARTICULARS OF EMPLOYEES

There are no employees who come under the provisions of Section 134 of the Companies Act, 2013 read with Companies (Particulars of Employees) Rules, 1975

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO

These fields continue to be the areas for improvement and of major progress. Keeping in view the escalation in energy cost, our organization is continuously endeavoring to find new and better ways for optimization of energy cost in its various manufacturing operations

In compliance with Section 134 of the Companies Act, 2013, read with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988, statement giving information regarding Energy Conservation, Technology

Absorption and Foreign Exchange earnings and out go is given I in Annexure- A forming part of this Annual Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

The Directors confirm:

1. that in the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departure.

2. that the Directors have selected such accounting policies and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period.

3. that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. that the Directors have prepared the annual accounts on a going concern basis.

REPORT ON CORPORATE GOVERNANCE

As required under Clause 49 of the Listing Agreement with the Stock Exchanges, the Corporate Governance Report forms part of the Annual Report as Annexure -B. Your Company is in full compliance with the requirements and disclosures as stated therein. A certificate from the Practicing Company Secretary confirming compliance of the Corporate Governance is appended to the Report on Corporate Governance.

REPORT ON MANAGEMENT DISCUSSION AND ANALYSIS

The report on Management Discussion and Analysis forms part of the Annual Report as Annexure - C

DEMATERIALISATION

The equity shares of your Company are available for dematerialization with both NSDL and CDSL under ISIN NE060J01017. As on 31st March 2014, 95.47% equity shares are in Demat form and remaining 4.53 % equity shares are in physical form ELECTRONIC REGISTRAR

Our registrar for electronic connectivity with the National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL) is M/s. Link Intime India Private Limited, Mumbai (Formerly M/s Intime Spectrum Registry Limited)

HUMAN RESOURCE MANAGMENT

Human Resource plays vital role in your company. If Finance is the blood of any organization then Human Resource is not less than pulse which keeps running production by their hard work day and night. Your company has performance management process to motivate people to give their best output and encourages innovation and meritocracy. Your Company has continued to maintain cordial and harmonious relation with employees and the board places on record their appreciation and sincere thanks towards their contribution to the Company''s performance during the year.

APPRECIATION

The Board takes this opportunity to express its sincere appreciation for the excellent support and corporation received from company''s bankers, investors, customers, suppliers, statutory authorities for their consistent support to the Company.

The Directors also sincerely acknowledge the outstanding support and services of the workers, staff and executives of the Company, which have together contributed to the efficient operations and management of the Company.

FOR AND ON BEHALF OF THE BOARD

sd/- sd/- Whole Time Director Whole Time Director

Place: Pithampur Date: 12th August, 2014


Mar 31, 2013

To, The Members,

The Board of Directors presents its Twentieth Directors'' Report on Company''s business and operations together with the Audited Financial Statements for the year ended 31st March 2013.

FINANCIAL RESULTS AND APPROPRIATION

(Rs. in million)

Standalone Consolidated Particulars 2012-13 2011-12 2012-13 2011-12

Sales & other incomes 8668.33 6227.83 9742.97 7471.90

Profit before interest, depreciation & Tax 1295.72 1071.64 1335.92 1162.23

Profit before Tax 451.86 448.46 434.51 490.48

Profit after Tax 360.10 343.60 338.70 378.39

Profit for the year / Balance available for 276.36 343.60 259.12 378.04

Appropriation

Less: Appropriation

Proposed dividend on equity shares & tax 26.71 25.25 26.71 25.25

Equity dividend and tax of earlier year 0.02 0.02

Surplus carried to Balance Sheet 249.63 318.35 232.39 352.79

FINANCIAL PERFORMANCE HIGHLIGHTS

During the period under review, Standalone Sales and other incomes of the Company stood at Rs.8668.33 Million as against that of Rs.6227.83 Million in the previous year showing a growth of 39.19%. Company''s Profit before interest, depreciation and tax increased to Rs.1295.72 Million from Rs.1071.64 Million at a growth rate of 20.91%.

The Consolidated Sales and other incomes were higher at Rs.9742.97 Million, up by 30.39% as compared to Rs.7471.90 Million in the previous year. Company''s Consolidated Profit after tax (PAT) decreased by 10.49% from Rs.378.39 Million to Rs.338.70 Million.

EXPORT SALES

The company recorded a growth of 6.93% in export sales from Rs.4491.48 Million in the previous year to Rs.4802.75 Million in this year.

DIVIDEND

Your Board is pleased to recommend a dividend of 10% on the equity share capital of the Company i.e. Rs.1.00 per equity share for the year ended 31st March 2013. The dividend, if approved, will be paid to the members within the time period stipulated by the Companies Act, 1956.

CREDIT RATING FOR BANKING FACILITIES M/s Credit Analysis & Research Limited (CARE) on April 2, 2013 has reaffirmed CARE BBB (Triple B ) credit rating for Long Term Facility and CARE A3 for Short Term Facility which indicates moderate degree of safety regarding timely servicing of financial obligations.

PRIVATE PLACEMENT AND FCCB ISSUE The Company has issued and allotted 1227273 Equity Shares on Preferential Basis under Private Placement, at a price of Rs.220/- per Equity Share inclusive of a premium of Rs.210/- per Equity Share to TPG Growth II SF Pte. Ltd. on 15th March, 2013.

The Company has issued 5.44% Foreign Currency Convertible Bonds (the "FCCBs") amounting to USD 25 Million. These FCCBs are convertible by the exercise of option by Bondholder i.e. TPG Growth II SF Pte. Ltd. into fully paid up equity shares of the Company at any time after the maturity date i.e. 26th April, 2018.

UTILISATION OF IPO FUND The proceeds from the initial issue of equity shares have been fully utilized by the Company and same has been reported in Consolidated Result (unaudited) for the quarter ended on June 30, 2012. However expected date of installation, trial run and commercial production for dripper machineries is upto October 2013.

AWARDS & CERTIFICATIONS

During the year both the Prestigious Food Grade Certificate i.e. American Institute of Baking Certificate (USFDA) and British Retail Consortium Certificate (BRC) were renewed.

Besides certification above your Company is accredited by ISO 14001: 2004, ISO 22000:2005 & ISO 9001-2008 certifications.

Your Company is a major exporter of FIBC and woven products from India and has received the Top Exporter Award from the PLEXCOUNCIL, Ministry of Commerce from 2005-06 to 2010-11.

SUBSIDIARIES

Your Company has three direct subsidiaries and two steps down subsidiaries. None of the subsidiaries have a negative net worth.

Subsidiaries

M/s Satguru Polyfab Private Limited, Gandhidham M/s Nanofil Technologies Private Limited, Kolkata M/s Flexiglobal Holdings Limited, Cyprus

Step- down Subsidiaries

M/s Flexiglobal (UK) Limited, UK

M/s Lakshmi Incorporated, USA

The financial details of the subsidiary companies as well as the extent of holdings therein are provided in a separate section of this Annual Report.

The Ministry of Corporate Affairs has, vide General Circular No. 2/2011 dt. 8th February, 2011, granted general exemption for not attaching the annual accounts of the subsidiary companies with the annual accounts of holding company.

Pursuant to the said circular, the Board of Directors of your company in their meeting held on 27th May 2013 has given its consent, for not attaching the Annual Accounts of the Subsidiary Companies with that of the Holding Company, instead has published the audited consolidated financial statements in the Annual Report. Accordingly, the annual accounts of Subsidiary Companies and all other documents required to be attached under section 212(1) of the Act to the Balance Sheet of the Company shall not be attached. However, these documents shall be made available upon request by any member of the Company interested in obtaining the same and shall also be kept for inspection at the Registered Office of your Company and that of Subsidiary Companies concerned. Further, the financial data of the Subsidiary Companies has been furnished along with the statement pursuant to section 212 of the Companies Act, 1956 forming part of this Annual Report.

EMPLOYEE STOCK OPTION SCHEME, 2011 Your Company has allotted 21550 equity shares of Rs.10/- each under ESOP Scheme 2011 in Board Meeting held on 30th May, 2012. The updates on the stock options are as under:

Total No. of Options Granted 1061750

Less: Options exercised on 9 Feb,2012 19700

Less: Options exercised on 30 May,2012 21550

Less: Options cancelled due to resignation/ 70750

surrender (June,2012)

Less: Options cancelled due to resignation/ 150450

surrender (May,2013)

Total Outstanding Options 799300

DIRECTORS

Mr. Manas Tandon, nominated by TPG Growth II SF Pte. Ltd.

was appointed as Investor Director w.e.f. 15.03.2013.

Mr. Vishwarupe Narain was appointed as Bondholder Nominee Director w.e.f. 27.05.2013.

There are three directors liable to retire by rotation of the ensuing Annual General Meeting namely, Mr. Anirudh Sonpal, Mr. Kaushal Ganeriwal and Mr. Kaushal Kishore Vijayvergiya. Retiring directors being eligible offer themselves for re- appointment. The board recommends their reappointment for your approval.

AUDITORS

M/s L.K. Maheshwari & Co, Chartered Accountants, Indore, Statutory Auditor of the Company holds office upto the conclusion of forthcoming Annual General Meeting.

Your Company has received a certificate from M/s BSR & Co., Chartered Accountants regarding their eligibility for appointment as statutory auditors as per Section 224(1B) of the

Companies Act, 1956 along with their consent for appointment. The board recommends the appointment of M/s BSR & Co., Chartered Accountants, Mumbai, as statutory auditors of the Company.

AUDITORS'' REPORT

The observations made in the Auditors'' Report, read with the relevant notes thereon are self explanatory and hence do not call for any further comments under section 217 of the Companies Act, 1956.

AUDIT COMMITTEE

The Company has constituted Audit Committee, pursuant to the provisions of Section 292A of the Companies Act, 1956 and provisions of the Listing Agreement. The Composition, Scope and powers of Audit Committee together with details of meetings held during the period under review forms part of Corporate Governance Report.

COST AUDITOR

During the year your Company has appointed M/s Vijay P. Joshi & Associates, Indore as Cost Auditor of the Company.

PUBLIC DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 58A of the Companies Act, 1956 and the rules made there under.

CODE OF CONDUCT

The Board has laid down a code of conduct for Members of the Board and Senior Management personnel of the Company. Members of the Board and Senior Management have affirmed compliance with the said code of conduct for the Financial Year 2012-13.

INDUSTRIAL RELATIONS

The Board is pleased to inform you that Industrial relations have continuously been cordial at all levels throughout the year. The Board of Directors place on record their deep appreciation for the sincere, devoted and dedicated team work of all employees at all levels to meet the quality, cost and delivery requirements of the customers.

PARTICULARS OF EMPLOYEES

There are no employee who come under the provisions of Section 217(2-A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO

These fields continue to be the areas for improvement and of major progress. Keeping in view the escalation in energy cost, our organization is continuously endeavoring to find new and better ways for optimization of energy cost in its various manufacturing operations.

In compliance with Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988, statement giving information regarding Energy Conservation, Technology Absorption and Foreign Exchange earnings and out go is given in Annexure- A forming part of this Annual Report.

DIRECTORS'' RESPONSIBILITY STATEMENT The Directors confirm:

1. that in the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departure.

2. that the Directors have selected such accounting policies and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period.

3. that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. that the Directors have prepared the annual accounts on a going concern basis.

REPORT ON CORPORATE GOVERNANCE As required under Clause 49 of the Listing Agreement with the Stock Exchanges, the Corporate Governance Report forms part of the Annual Report as Annexure – B. Your Company is in full compliance with the requirements and disclosures as stated therein. A certificate from the Practicing Company

Secretary confirming compliance of the Corporate Governance is appended to the Report on Corporate Governance.

DEMATERIALISATION

The equity shares of your Company are available for dematerialization with both NSDL and CDSL under ISIN INE060J01017. As on 31st March 2013, 95.10 % equity shares are in Demat form and remaining 4.90 % equity shares are in physical form.

ELECTRONIC REGISTRAR

Our registrar for electronic connectivity with the National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL) is M/s. Link Intime India Private Limited, Mumbai (Formerly M/s Intime Spectrum Registry Limited).

HUMAN RESOURCE MANAGMENT Human Resource plays vital role in your company. If Finance is the blood of any organization then Human Resource is not less than pulse which keeps running production by their hard work day and night. Your company has performance management process to motivate people to give their best output and encourages innovation and meritocracy. Your Company has continued to maintain cordial and harmonious relation with employees and the board places on record their appreciation and sincere thanks towards their contribution to the Company''s performance during the year.

APPRECIATION

The Board takes this opportunity to express its sincere appreciation for the excellent support and corporation received from company''s bankers, investors, customers, suppliers, statutory authorities for their consistent support to the Company.

The Directors also sincerely acknowledge the outstanding support and services of the workers, staff and executives of the Company, which have together contributed to the efficient operations and management of the Company.

FOR AND ON BEHALF OF THE BOARD

Whole Time Director Whole Time Director

Place: Pithampur

Date: 2nd August, 2013


Mar 31, 2012

The Members,

The Board of Directors present their Nineteenth Directors' Report on Company's business and operations together with the Audited Financial Statements for the year ended 31st March 2012.

Financial Results and Appropriation

Particulars 2011-12 2010-11 (Rs in Million) (Rs in Million) Standalone Standalone

Sales (Including other income) 6227.83 4903.68

Profit before interest, depreciation & Tax 1071.64 693.73

Profit before Tax 448.46 317.63

Profit after Tax 343.60 274.36

Profit for the year 343.60 274.36

Add: Balance brought forward from Previous Year - -

Balance available for Appropriation 343.60 274.36

Appropriation

Proposed dividend 21.73 17.21

Tax on dividend 3.52 2.86

Transfer to general reserve - -

Surplus carried to Balance Sheet 318.35 254.29

Financial Highlights and Operations

During the period under review, Sales and other income stood at Rs. 6227.83 Millions as against that of Rs. 4903.68 Millions in the previous year showing a growth of 27%. Company's Profit before interest, depreciation and tax increased to Rs. 1071.64 Millions from Rs. 693.73 Millions in the previous year showing a growth of 54.47%.

During the period under review, Consolidated Sales and other income of your Company stands at Rs.7471.90 Millions as against that of Rs. 5793.92 Millions in the previous year showing a growth of 28.96%. Company's Consolidated Profit after tax (PAT) increased to Rs. 378.39 Millions from Rs. 294.07 Millions in the previous year showing a growth of 28.67%.

Export Sales

During the period export sales increased by Rs. 85.38 Million i.e.23.47 % and stood at Rs. 449.14 Millions as against Rs. 363.76 Million in the previous year.

Dividend

Your Board of Directors are pleased to recommend a dividend of 10% on the equity share capital of the Company i.e. Rs. 1.00 per equity share for the year ended 31st March 2012. The dividend, if approved, will be paid to the members within the time period stipulated by the Companies Act, 1956.

Initial Public Offer

During the year your company got listing of its equity shares on both BSE and NSE.

Initial Public Offer of your Company was opened from 29th September 2011 to 4th October 2011 for QIB and 5th October 2011 for others.

There was a fresh issue of 4500000 equity shares and Offer for sale of 2250000 equity shares from Clearwater Capital Partners (Cyprus) Ltd. of Rs. 10/- each at Rs. 155/- per share.

Credit Analysis & Research Limited assigned Credit Rating 3 out of 5 to Company's IPO.

Equity shares of your Compny listed from 19th October 2011 at BSE and NSE.

Credit Rating For Banking Facilities

M/s Credit Analysis & Research Limited (CARE) improved credit rating for Long Term and Facility as well as Short Term Facility for the Financial Year 2011-12 from CARE BBB (Triple B) and CARE PR 3 to CARE BBB (Triple B ) and CARE A3 respectively, which indicates moderate degree of safety regarding timely servicing of financial obligations.

Dripper Project

Your Company has entered in new era of manufacturing of Drippers at Kashipur unit under Drip Irrigation System. The initial capacity of dripper project envisaged in Initial Public Offer document was 811 MT, however in view of initial encouraging results and better prospects ahead, it is planned to increase capacity further.

Utilisation of IPO Fund

During the year your Company raised fund through Initial Public Offer for objects as mentioned in Prospectus and has utilised major amount towards the object. Through IPO funds, there will be expansion of FIBC manufacturing capacity by 1000 MT at SEZ, 2000 MT at DTA Unit Pithampur and 811 MT at Kashipur Unit.

Awards & Certifications

Your Company has been awarded with both the prestigious Food Grade Certificate i.e. American Institute of Baking Certificate (USFDA) and British Retail Consortium Certificate (BRC). During the year under review both the certifications have been renewed.

Besides certification from American Institute of Baking (USFDA), USA & British Retail Consortium (BRC), UK, your Company is accredited by ISO 14001: 2004, ISO 22000:2005 & ISO 9001-2008 certifications.

Your Company is a major exporter of FIBC and woven products from India and has received the Top Exporter Award from the PLEXCOUNCIL, Ministry of Commerce from 2005-06 to 2010-11.

Subsidiaries

Your Company has three direct subsidiaries and two steps down subsidiaries. None of the subsidiaries have a negative net worth.

Subsidiaries

1. M/s Satguru Polyfab Private Limited, Gandhidham

2. M/s Nanofil Technologies Private Limited, Kolkata

3. M/s Flexiglobal Holdings Limited, Cyprus

Step-down Subsidiaries

1. M/s Flexiglobal (UK) Limited, UK

2. M/s Lakshmi Incorporated, USA

The financial details of the subsidiary companies as well as the extent of holdings therein are provided in a separate section of this Annual Report.

The Ministry of Corporate Affairs has, vide General Circular No. 2/2011 dt. 8th February, 2011, granted general exemption for not attaching the annual accounts of the subsidiary companies with the annual accounts of holding company.

Pursuant to the said circular, the Board of Directors of your company in their meeting held on 30th May 2012 has given their consent, for not attaching the Annual Accounts of the Subsidiary Companies with that of the Holding Company.

Accordingly, Balance Sheet, Profit & Loss Account, Directors' Report and Auditors' Report of the Subsidiary Companies and other documents required to be attached under section 212(1) of the Act to the Balance Sheet of the Company shall not be attached. However, these documents shall be made available upon request by any member of the Company interested in obtaining the same and shall also be kept for inspection at the Registered Office of your Company and that of Subsidiary Companies concerned. Further, the financial data of the Subsidiary Companies have been furnished along with the statement pursuant to section 212 of the Companies Act, 1956 forming part of this Annual Report.

Changes in Share Capital

During the year the Company allotted 45, 00,000 Equity Shares of the Face Value of Rs. 10/- each in IPO and 19700 equity shares of Rs. 10/- each under ESOP Scheme 2011 in Board Meeting held on 9th February, 2012, consequently the number of issued, subscribed and paid up capital increased from 17212110 Equity Shares to 21731810 Equity Shares of Rs. 10/- each aggregating Rs. 217,318,100/-.

Reconciliation of options is as under:

Particulars Number of Shares

In-principle approval taken 1075000 from BSE and NSE

Less: No. of Shares allotted & listed 19700

Less: No. of options/ shares lapsed 70750* (due to Resignation etc.) as on 31st March, 2012*

Balance outstanding 984550

* * With reference to clause No. 3.3 of ESOP Scheme 2011, the Employee Stock Options that expires/ lapse/ get cancelled shall become available for future grants, subject to compliance with the applicable laws.

Directors

Mr. Kaushal Ganeriwal was appointed as Director in place of Mr. Aswini Sahoo, due to change in nomination by Clearwater Capital Partners, (Cyprus) Ltd. w.e.f. 09.02.2012 pursuant to Section 260 of the Companies Act, 1956.

Mr. Saurabh Kalani, Mr. Kaushal Kishore Vijayvergiya and Mr. Manoj Kumar Dwivedi are appointed as additional director by the Board of Directors of the Company at their meeting held on 30th May, 2012. They were appointed as Whole Time Directors in the same meeting. They are liable to retire by rotation.

Mr. Pawan Kumar Jain and Mr. Ravindra Kumar Chourasiya also tendered their resignation which were accepted by Board of Directors w.e.f. 30.05.2012.

There are two directors who are liable to retire by rotation for the financial year under review namely, Mr. Anirudh Sonpal and Mr. Kevan John Upperdine. Mr. Anirudh Sonpal and Mr. Kevan John Upperdine are being eligible and offer themselves for re- appointment. The board recommends their reappointment for your approval.

Auditors

M/s L.K. Maheshwari & Co, Chartered Accountants, Indore, Statutory Auditor of the Company hold office upto the conclusion of forthcoming Annual General Meeting and being eligible, offer themselves for re-appointment. Your Company has received a certificate from M/s L.K. Maheshwari & Co, Chartered Accountants regarding their eligibility for appointment as statutory auditors as per Section 224(1B) of the Companies Act, 1956 along with their consent for reappointment. The board recommends the re-appointment of M/s L.K. Maheshwari & Co, Chartered Accountants, Indore, as statutory auditors of the Company.

Auditors' Report

The observations made in the Auditors' Report, read with the relevant notes thereon are self explanatory and hence do not call for any further comments under section 217 of the Companies Act, 1956.

Public Deposits

Your Company has not accepted any deposits within the meaning of Section 58A of the Companies Act, 1956 and the rules made there under.

Code of Conduct

The Board has laid down a code of conduct for prohibition of Insider Trading to all Board members and Senior Management of the Company. Members of the Board and Senior Management have affirmed compliance with the said code of conduct for the Financial Year 2011-12.

Industrial Relations

The Board is pleased to inform you that Industrial relations have been continued cordial at all levels throughout the year. The Board of Directors place on record their deep appreciation for the sincere, devotion and dedicated team work of all employees at all levels to meet the quality, cost and delivery requirements of the customers.

Particulars of Employees

There are no employees who come under the provisions of Section 217(2-A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975.

Energy Conservation, Technology Absorption and Foreign Exchange Earning and Outgo

These fields continue to be the areas for improvement and of major progress. Keeping in view the escalation in energy cost, our organization is continuously endeavoring to find new and better ways for optimization of energy cost in its various manufacturing operations.

In compliance with Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988, statement giving information regarding Energy Conservation, Technology Absorption and Foreign Exchange earnings and out go is given in Annexure- A forming part of this Annual Report.

Directors' Responsibility Statement

The Directors confirm:

1. that in the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departure.

2. that the Directors have selected such accounting policies and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period.

3. that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. that the Directors had prepared the annual accounts on a going concern basis.

Corporate Governance

The Board is glad to inform you that your Company is professionally managed company and complied with all mandatory provisions of Corporate Governance as prescribed under the Listing Agreement of Stock Exchanges with which the Company listed on 19th day of October, 2011.

As per requirement of Clause 49 of Listing Agreement a brief

report on Corporate Governance along with Certificate from Practicing Company Secretary is annexed herewith for the information of the members as an Annexure - B in this Annual Report.

Dematerialisation

The equity shares of your Company are available for dematerialization with both NSDL and CDSL and the ISIN is INE060J01017. As on 31st March 2012, 93.80% equity shares are in Demat form and remaining 6.20 % equity shares are in physical form.

Electronic Registrar

Our registrar for electronic connectivity with the National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL) is M/s. Link Intime India Private Limited, Mumbai (Formerly M/s Intime Spectrum Registry Limited).

Human Resource Managment

Human Resource plays vital role in your company. If Finance is the blood of any organization then Human Resource is not less than pulse which keeps running production by their hard work day and night. Your company has performance management process to motivate people to give their best output and encourages innovation and meritocracy. Your Company has continued to maintain cordial and harmonious relation with employees and the board places on record their appreciation and sincere thanks towards their contribution to the Company's performance during the year.

Appreciation

The Board takes this opportunity to express its sincere appreciation for the excellent support and cooperation received from Company's bankers, investors, financial institutions, shareholders, customers, suppliers, statutory authorities for their consistent support to the Company.

The Directors also sincerely acknowledge the outstanding support and services of the workers, staff and executives of the Company, which have together contributed to the efficient operation and management of the Company.

For and on Behalf of The Board

Managing Director Whole Time Director

Place: Pithampur Date : 30th May, 2012




Mar 31, 2011

To The Members of Flexituff International Limited

We are pleased to present the Eighteenth Directors' Report on your Company's business and operations together with the Audited Financial Statements consolidated and the auditor's report of your Company for the year ended 31st March 2011.

FINANCIAL RESULTS AND APPROPRIATION (Consolidated)

Particulars 2010-11 2009-10 (Rs in Million) (Rs in Million)

Sales 5,793.93 3,220.95

Profit before interest, depreciation & Tax 768.64 422.37

Profit before Tax 342.38 89.78

Profit after Tax 288.81 31.91

Prior Period Adjustment (5.26) (6.02)

Profit for the year 309.67 45.97

Add: Balance brought forward from Previous Year 204.71 181.94

Balance available for Appropriation 514.38 227.92 Appropriation Proposed dividend 173.21 11.32

Tax on dividend 0.28 0.18

Transfer to general reserve 0.00 10.00

Surplus carried to Balance Sheet 380.97 204.71

REVIEW OF OPERATIONS

Financial Year 2010-11 during the period consolidated sales and other income stood at Rs. 5,793.93 Millions as against that of Rs 3 220 96 Millions in the previous year showing a growth of 79.88% .Company's consolidated Profit before interest, depreciation and tax increased to Rs. 768.64 Millions from Rs. 422.37 Millions in the previous year showing a growth of 81.98%

EXPORTS

During the period consolidated export sales increased by Rs. 2,218.33 Million i.e. 101.52 % and stood at Rs. 4,403.55 Millions as against Rs. 2,185.22 Million in the previous year.

APPROPRIATIONS

Dividend

Your Board of Directors are pleased to recommend a dividend of 10% on the equity share capital of the Company i.e. Rs. 1.00 per equity share for the year ended 31st March 2011. The dividend, if approved, will be paid to the members within the time period stipulated by the Companies Act, 1956.

AWARDS & CERTIFICATIONS

Your Company has been awarded with both the prestigious Food Grade Certificate i.e. American Institute of Baking Certificate (USFDA) and British Retail Consortium Certificate (BRC). During the year under review both the certifications have been renewed.

Besides certification from American Institute of Baking (USFDA), USA& British Retail Consortium (BRC), UK, your Company is accredited by ISO 14001:2004, ISO 22000:2005 & ISO 9001 -2008 certifications.

Your Company is a major exporter of FIBC and woven products from India and has received the Top Exporter Award from the PLEXCOUNCIL, Ministry of Commerce from 2005-06 to 2008-09.

SUBSIDIARIES

Your Company has three direct subsidiaries and two step down subsidiaries. None of the subsidiaries have a negative net worth.

Direct Subsidiaries

1. M/s Satguru Polyfab Private Limited, Gandhidham

2. M/s Nanofil Technologies Private Limited, Kolkata

3. M/s Flexiglobal Holdings Limited, Cyprus

Indirect Subsidiaries

1. Flexiglobal (UK) Limited

2. Lakshmi Incorporated.

Statement pursuant to section 212 of the Companies Act 1956, the balance sheets of all subsidiaries are attached and form a part of the Annual Report 2011.

DISASSOCIATION FROM ECO POLYMERS LIMITED

During the year in review, your Company had a subsidiary in the name of Eco Polymers Limited which was incorporated in Bangladesh. However, as no business was conducted in this company and for lack of business prospects in Bangladesh, the Company disassociated itself from the said company on September 29, 2010 by transferring its entire shareholding in Eco Polymers Limited to a third party for a consideration Rs. 0.44 million.

CONVERSION OF SHARE WARRANTS INTO EQUITY SHARES

During the year under review, Kalani Industries Private Limited, one of our Promoters, exercised its option to convert 1,068,000 convertible share warrants into equity shares in the ratio of 1:1 i.e. 1 equity share for every one share warrant held. Accordingly, upon conversion, 1,068,000 equity shares were issued and allotted by the Company in favour of Kalani Industries Private Limited. Presently, there are no outstanding share warrants pending conversion.

CONVERSION OF FULLY CONVERTIBLE DEBENTURES INTO EQUITY SHARES

Your Company allotted 92 (ninety two) 0% Fully Convertible Debentures (FCDs) having a face value of Rs. 5,000,000 per debenture in favour of Clearwater Capital Partners (Cyprus) Limited at par, aggregating to Rs, 460,000,000. During the year under review, Clearwater Capital Partners (Cyprus) Limited exercised its option to convert all 92 FCDs into equity shares and accordingly 4,486,492 equity shares were issued at a conversion price at Rs. 102.53 /- per share.

DIRECTORS

During the year under review, Mr. Anirudh Sonpal was appointed as an Additional Director pursuant to Section 260 of the Companies Act, 1956 and Articles of Association of the Company holding office upto the date of the next Annual General Meeting. It is proposed to appoint him as director of the Company, liable to retire by rotation, at the ensuing Annual General Meeting.

During the year under review Mr. Sunil Bhargava resigned from the post of Director of the Company w.e.f. 30.09.2010. The Board places on record it's appreciation for the contribution made by Mr. Bhargava during his tenure as a Director.

There are two directors who are liable to retire by rotation for the financial year under review namely, Mr. Pawan Kumar Jain and Mr. Ravindra Chourasiya. Mr. Pawan Kumar Jain and Mr. Ravindra Chourasiya are being eligible and offer themselves for re-appointment. The board recommends their reappointment for your approval.

AUDITORS

The term of appointment of M/s L.K. Maheshwari &Co, Chartered Accountants, Indore, Statutory Auditor of the Company will expire at the ensuing Annual General Meeting. The Company has received a certificate from M/s L.K. Maheshwari & Co, Chartered Accountants regarding their eligibility for appointment as statutory auditors as per Section 224(1 B) of the Companies Act, 1956 along with their consent for reappointment. The board recommends the re-appointment of M/s L.K. Maheshwari & Co, Chartered Accountants, Indore, as statutory auditors of the Company for the year 2011 -12.

AUDITORS'REPORT

The observations made in the Auditors' Report, read with the relevant notes thereon are self explanatory and hence do not call for any further comments under section 217 of the Companies Act, 1956.

PUBLIC DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 58A of the Companies Act, 1956 and the rules made there under.

PARTICULARS OF EMPLOYEES

There are no employees who come under the provisions of Section 217(2-A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO

These fields continue to be the areas for improvement and major progress. Keeping in view the escalation in energy cost, our organization is continuously endeavoring to find new and better ways for optimization of energy cost in its various manufacturing operations.

In compliance with Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988, statement giving information regarding Energy Conservation, Technology Absorption and Foreign Exchange earnings and out go is given in Annexure-Forming part of this Annual Report.

DIRECTORS' RESPONSIBILITY STATEMENT

The Directors confirm:

1. that in the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departure.

2. that the Directors have selected such accounting policies and have applied them consistently and made judgments and . estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period.

3. that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. that the Directors had prepared the annual accounts on a going concern basis.

INITIAL PUBLIC OFFER

Your Company is proposing, subject to receipt of requisite approvals and market conditions, to raise capital through an initial public offering (which comprises of fresh issue of equity shares by the Company and offer for sale by its existing shareholder- Clearwater Capital Partners (Cyprus) Limited). The objects of the proposed IPO is (i) expansion of manufacturing facilities at SEZ and DTA units at Pithampur, (ii) setting up of dripper project at Kashipur, working capital requirements; and (iii) general corporate purposes. In this regard, the Company had filed the Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) on March 29, 2011. The copy of the DRHP is available on the websites of the SEBI at www.sebi.gov.in, the book running lead manager, www.csinga.com and our Company at www.flexituff.com.

The SEBI has issued its observations on the DRHP vide its letter dated June 14,2011. The Company has also obtained the in- principle listing approvals from Bombay Stock Exchange Limited (BSE), National Stock Exchange of India Limited (NSE) on May 19, 2011 and June 10, 2011 respectively. The Company is in process of filing the in-seriatim reply in response to observations issued by SEBI.

CORPORATE GOVERNANCE

As your Company's shares are not listed on any stock exchange, the provisions of the listing agreement, including those relating to corporate governance, are not applicable. However, in view of the Company's proposed IPO, and as required by the Securities Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, your Company has complied with the corporate governance requirements contained in the equity listing agreement (as applicable), particularly those relating to composition of board of directors, constitution of committees such as Audit Committee, Shareholder / Investor Grievance Committee, etc. In addition, our Company intends to adopt a code of conduct for prevention of insider trading.

Currently, our Board comprises of seven Directors, of which the Chairman is a Non-Executive and Independent Director. In compliance with the requirements of Clause 49 of the Listing Agreement, our Company has one executive director and six non-executive directors of whom three are independent directors.

Abrief report on your Company's compliance with the corporate governance norms is separately provided as an Annexure - B in this Annual Report.

DEMATERIALISATION

The equity shares of your Company are available for dematerialisation with both NSDL and CDSL and the ISIN is INE060J01017.92.17 % equity shares are in Demat form and remaining 7.83 % equity shares are kept in physical form.

ELECTRONIC REGISTRAR

Our registrar for electronic connectivity with the National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL) is M/s. Link Intime India Private Limited, Mumbai (Formerly M/s Intime Spectrum Registry Limited).

EMPLOYEE STOCK OPTION SCHEME

During the year under review your Company has instituted the Employee Stock Option Scheme 2011, pursuant to the approval of the shareholders. Pursuant to the provisions of the Employee Stock Option Scheme 2011,1,061,750 options were issued to eligible employees of the Company. These options are convertible into similar number of equity shares of face value of Rs.10 each of the Company in accordance with the provisions of ESOP 2011. The Employee Stock Option Scheme 2011 is in compliance with the provisions of the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999.

HUMAN RESOURCE MANAGEMENT

Human Capital has always been amongst the most important and valuable assets of the Company. Your Company has enhanced its performance management process that motivates people to take ownership of their own performance and encourages innovation and meritocracy. Your Company has continued to maintain cordial and harmonious relation with employees and the board places on record their appreciation and sincere thanks towards their contribution to the Company's performance during the year.

ACKNOWLEDGEMENT

Your Directors wish to express their deep grateful appreciation for the valuable support and co-operation received from the shareholders and other stakeholders including various statutory authorities and society at large. Your director also place on record, their appreciation for the contribution and hard work of employees of the Company and its subsidiaries at all levels.

FOR AND ON BEHALF OF THE BOARD

Place: Mumbai Director Director

Date : 18.06.2011

 
Subscribe now to get personal finance updates in your inbox!