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

Directors Report of Gillanders Arbuthnot & Company Ltd.

Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the Annual Report on the affairs of the Company together with the Audited Financial Statements for the financial year ended on 31st March, 2015.

FINANCIAL RESULTS

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

(Rs. in lakhs)

Particulars Standalone

2014-15 2013-14

Profit Before Depreciation, Interest and Tax (PBDIT) 5,418.90 6,880.19

Interest / Finance Charges 4,067.05 3,597.78

Profit Before Depreciation and Tax (PBDT) 1,351.85 3,282.41

Depreciation / Amortisation 2,067.15 2,859.49

Profit(Loss) Before Tax (PBT) (715.30) 422.92

Taxation Charge

-Current Tax 110.00 190.00

-Deferred Tax Written Back (504.20) (325.00)

Profit(Loss) After Tax (PAT) (321.10) 557.92

Balance brought forward 5,991.03 5,739.10

Depreciation adjustement as per revised calculations (230.88) -

(net of deferred tax) pursuant to Schedule II of the Companies Act, 2013

Balance available for appropriation 5,439.05 6,297.02

Appropriations

Proposed Dividend on:

8% Redeemable Cumulative Preference Shares of Rs.100 each - 16.00

Ordinary Shares of Rs.10 each - 160.07

Corporate Dividend Tax - 29.92

Transfer to General Reserve - 100.00

Surplus carried to Balance Sheet 5,439.05 5,991.03

5,439.05 6,297.02

Earnings per Ordinary Share (Rs.)

- Basic (1.58) 2.53

- Diluted (1.58) 2.53

Dividend per Ordinary Share (Rs.) - 0.75





Particulars Consolidated

2014-15

Profit Before Depreciation, Interest and Tax (PBDIT) 5,090.55

Interest / Finance Charges 4,207.80

Profit Before Depreciation and Tax (PBDT) 882.75

Depreciation / Amortisation 2,105.42

Profit(Loss) Before Tax (PBT) (1,222.67)

Taxation Charge

-Current Tax 145.20

-Deferred Tax Written Back (480.20)

Profit(Loss) After Tax (PAT) (887.67)

Balance brought forward 5,991.03

Depreciation adjustement as per revised calculations (230.88)

(net of deferred tax) pursuant to Schedule II of the Companies Act, 2013

Balance available for appropriation 4,872.48

Appropriations

Proposed Dividend on:

8% Redeemable Cumulative Preference Shares of Rs.100 each -

Ordinary Shares of Rs.10 each -

Corporate Dividend Tax -

Transfer to General Reserve -

Surplus carried to Balance Sheet 4,872.48

4,872.48

Earnings per Ordinary Share (Rs.)

- Basic (4.23)

- Diluted (4.23)

Dividend per Ordinary Share (Rs.) -

FINANCIAL ANALYSIS AND REVIEW OF OPERATIONS

For the financial year ended on 31st March, 2015, your Company reported a loss of Rs.321.10 lakhs against profit of Rs.557.92 lakhs during the previous year. Total Income from Operations has decreased to Rs.86,780.96 lakhs during the year under review from Rs.94,679.82 lakhs in the previous year. Operational matters have been discussed under 'Management Discussion and Analysis,' detailed in appropriate part of this Report.

DIVIDEND

In view of the loss incurred by the Company for the financial year ended on 31st March, 2015, your Directors have not recommended any dividend for the said financial year.

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated financial statements for the financial year ended on 31st March, 2015, prepared as per the provisions of the Companies Act, 2013. (hereinafter reffered to as 'the Act'), Rules framed therein and the applicable Accounting Standards are provided in the Annual Report.

SUBSIDIARY/ASSOCIATE COMPANIES

As reported last year, your Directors are pleased to inform you that in September 2014, Gillanders Holdings (Mauritius) Limited, Mauritius, a wholly owned subsidiary of the Company, has acquired 100 percent fully paid up Ordinary Shares of Group Developments Limited, Malawi, alongwith its wholly owned subsidiaries viz. Naming'omba Tea Estate Limited, Maifisi Tea Esates Limited and Group Holdings Limited. The said estates are engaged in growing and processing of Tea, Macadamia and other crops. Production of tea from these estates during the period under review was affected by drought and subsequent flood, which resulted in marginal fall in production. However, production of Macadamia was slightly better than the corresponding period last year. During the year under review, the focus was on improving agricultural field practices, benefits of which will start accruing in the coming year. The results of the subsidiaries for the current period reflect only seven months of operations after the acquisition and hence are not indicative of full year results and are not comparable with the previous year. Your Directors are expecting a better result in the coming year due to improve in agricultural practices and successful implementation of cost management plans.

During the year under review, Satyam Financial Services Limited, Kolkata, the sole associate of the Company, ceased to be an associate.

A separate section on the performance and financial position of the subsidiaries/associate in Form AOC-1 is part of the Annual Report and is annexed to the Report.

FIXED DEPOSITS

The Company is eligible to invite, accept or renew deposits under the provisions of the Act and the Rules framed therein.

As on 31st March, 2015 an amount of Rs. 2,948.84 lakhs was outstanding as fixed deposits received from the public and shareholders of your Company. Matured fixed deposit amounting to Rs. 3.20 lakhs remained unclaimed and outstanding as on 31st March, 2015, out of which 3 numbers, of deposits amounting to Rs. 2.06 lakhs have been claimed and refunded in April, 2015.

DIRECTORS

In accordance with the provisions of the Act, Mr. A. K. Kothari (DIN: 00051900) will retire in the ensuing Annual General Meeting, and being eligible, offers himself, for re-appointment. The Board of Directors recommends the same.

Mrs. S. Basu De (DIN: 06921540) was appointed by the Board of Directors as an Additional Director of the Company with effect from 14th August, 2014 and she will hold office as a Director of the Comapany upto the date of the ensuing 81st Annual General Meeting. The Company has received notice in writing from a Member alongwith the deposit of requisite amount under Section 160 of the Act proposing the candidature of Mrs. S. Basu De for the office of an Independent Director of the Company to hold office for a period of 5 (Five) consecutie years up to the conclusion of the 86th Annual General Meeting of the Company to be held in the calendar year 2020.

The Company has also received declaration from Mrs. S. Basu De that she meets the criteria of independence, as prescribed, both under Section 149(6) of the Act and under Clause 49 of the Listing Agreement. The Board recommends her appointment as an Independent Director, by way of an Ordinary Resolution.

The Company has also received declarations from Dr. H. P. Kanoria (DIN: 00286685), Mr. H. M. Parekh (DIN: 00026530) and Mr. N. Pachisia (DIN: 00233768), Independent Directors of the Company, that they meet the criteria of Independence as prescribed both under the Act and the Listing Agreement with the Stock Exchanges.

The details of programmes for familiarization/ training of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters can accessed on the website of the Company at the link: http://www.gillandersarbuthnot.com/policies/ tid policy.pdf

Mr. P. K. Khaitan (DIN: 00004821) and Mr. J. N. Godbole (DIN: 00056830) have resigned from the Board of Directors of the Company in the during financial year ended on 31st March, 2015, in order to comply with the provisions of the Act and the Listing Agreement with respect to maximum number of Directorship that a person can hold. The Board wishes to place on record its deep sense of appreciation and gratitude for the valuable contribution, guidance and advice received from them.

DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors state that:

a) in the preparation of the annual accounts for the financial year ended on 31st March, 2015, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

b) such accounting policies have been selected and applied 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 as at 31st March, 2015 and of the loss of the Company for the year ended on that date;

c) 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;

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

e) internal financial controls has been laid down so that the same can be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

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

CORPORATE GOVERNANCE

The Company is committed to maintain the highest standards of Corporate Governance and adhere to the Corporate Governance requirements set out by Securities and Exchange Board of India . The Report on Corporate Governance confirming compliance with the conditions stipulated under Clause 49 of the Listing Agreement, which forms part of the Annual Report, is attached to this Report. Certificate on Corporate Governance, as stipulated in Clause 49 of the Listing Agreement with Stock Exchanges, issued by CS Deepak Kumar Khaitan, Practicing Company Secretary (FCS NO. 5615), is also attached to this Report.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm's length basis. Since all related party transactions entered into by the Company were in the ordinary course of business and were on an arm's length basis, Form AOC-2 is not apptlicable to the Company.

During the year, the Company has not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.

The Policy on related party transactions as approved by the Board may be accessed on the Company's website at the link: http://www.gillandersarbuthnot.com/policies/rpt policy.pdf. Your Directors draw attention of the members to Note No. 35 to the standalone financial statements which sets out related party disclosures.

CORPORATE SOCIAL RESPONSIBILITY

Your Company believes that growth, success and progress of a Company are not reflected only by its Balance Sheet but also by its ability to make a positive difference in the lives of people and tries to address the needs of people by taking sustainable initiatives in the areas of health, education, environment conservation, infrastructure and community development.

The Company does not limit itself in using resources only for earnings but also engages in activities which enrich and enhance the lives of everyone around us. Company's Corporate Social Responsibility (CSR) initiatives are continuous commitment to contribute to economic development and to improve the quality of life of humankind. Business decisions are based not only on financial factors, but also on social and environmental impact of such decisions.

The Corporate Social Responsibility Committee has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board. The CSR Policy may be accessed on the Company's website at the link : http://www.gillandersarbuthnot.com/ policies/csr policy.pdf. The Company undertakes need based initiatives in compliance with Schedule VII of the Act.

During the year under review, the Company has spent Rs. 12.26 lakhs on CSR activities, in compliance with the provisions of the Companies Act and Rules framed therein. The Annual Report on CSR activities is annexed herewith and marked as Annexure I.

RISK MANAGEMENT

The Company has laid down a procedure to inform the Board Members, on a periodic basis, about the identified risks and the steps taken to mitigate and minimize the same. The Company has already identified and assessed major elements of risks, which may threaten the existence of the various Divisions of the Company. The Executive Management reviews the identified risks, including assessment of the said risks and procedures, which are being implemented for the monitoring, mitigating and minimization of the said risks. Risk officers have been formally nominated at the operating businesses, whose role is to educate about the identified risks and to develop risk management culture within the businesses.

AUDITORS

Messrs. Singhi & Co., Chartered Accountants, (Firm Registration No. 302049E) and Statutory Auditor of the Company, who retire after the conclusion of the ensuing 81st Annual General Meeting, and being eligible, offer themselves, for re-appointment for a term of 5 (Five) consecutive years up to the conclusion of the 86th Annual General Meeting of the Company to be held in the calendar year 2020.

At the 80th Annual General Meeting of the Company, held on 14th August, 2014, Messrs. Dutta Ghosh & Associates, Chartered Accountants (Firm Registration No. 309088E) and Messrs. Kothari & Company, Chartered Accountants, (Firm Registration No. 301178E) had been appointed as Branch Auditors of the GIS Cotton Mill (unit of Textile Division) and the Engineering (MICCO) Division of the Company for a term of 4 (Four) and 3 (Three) consecutive years respectively. However, their appointment is subject to ratification at the ensuing 81st Annual General Meeting of the Company scheduled to be held on 3rd September, 2015.

Your Board has obtained written consent from Messrs. Singhi & Co., Chartered Accountants, for their re-appointment and a certificate confirming that the re-appointment, if made, shall be in accordance with the conditions as prescribed under Sections 139 and 141 of the Act, and the Rules framed therein. The aforesaid re-appointment has the consent of the Audit Committee. Accordingly, the Board recommends their re-appointment by way of an Ordinary Resolution.

AUDITORS' REPORT

Auditors' Report to the members of the Company does not contain any qualification or adverse remark. Financial Statements and notes thereon are self-explanatory and need no further explanation.

COST AUDITORS

On the recommendation of the Audit Committee, and in compliance with Section 148 of the Act, the Companies (Cost Accounting Records) Rules, 2011, Companies (Cost Audit Report) Rules, 2011, notification S.O. 1747(E) dated 7th August, 2012 and Order F. No. 52/26/CAB-2010 dated 6th November, 2012 issued by the Ministry of Corporate Affairs, the Board of Directors of the Company at their Meeting held on 26th May, 2014 had appointed Cost Auditors for Tea, Textile and Chemical (Waldies) Divisions of the Company for the financial year ended on 31st March, 2015.

Meanwhile, the Ministry of Corporate Affairs (MCA), had issued a notification dated 30th June, 2014 through which the Companies (Cost Records and Audit) Rules, 2014 were notified, which was subsequently amended by the MCA vide notification dated 31st December, 2014. Subsequent to the said notifications, maintenance of cost accounting records and audit was not applicable for the Tea and Textile Divisions of the Company for the financial year ended on 31st March, 2015. However, it was applicable for the Chemical (Waldies) and Engineering (MICCO) Divisions of the Company for the said financial year. Messrs. Rammani Sarkar & Co., Cost Accountants, (Firm Registration No. 100714) was appointed as Cost Auditor of the Chemical (Waldies) Division of the Company for the financial year ended on 31st March, 2015.

In order to comply with the aforesaid Notifications, the Board of Directors of the Company at their Meeting held on 13th February, 2015, had appointed M/s. Rammani Sarkar & Co., Cost Accountants, (Firm Registration No. 100714) as the Cost Auditor of the Engineering (MICCO) Division of the Company for the financial year ended on 31st March, 2015 at a remuneration of Rs.40,000/- (Rupees forty thousand only) plus reimbursement of out of pocket expenses.

SECRETARIAL AUDIT

The Board had appointed CS. K. C. Dhanuka, Practising Company Secretary,(FCS No. 2204) to conduct Secretarial Audit for the financial year ended on 31st March, 2015. The Secretarial Audit Report for the financial year ended on 31st March, 2015 is annexed herewith and marked as Annexure II to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

OTHER DISCLOSURES:

Composition of Corporate Social Responsibility Committee

The Corporate Social Responsibility Committee of the Company, at present, comprises of Mr. H. M. Parekh as the Chairman of the Committee, Mr. N. Pachisia and Mrs. S. Basu De as the Members of the said Committee.

Composition of Audit Committee

The Audit Committee of the Company, at present, comprises of Mr. H. M. Parekh as the Chairman of the Committee, Mr. A. K. Kothari, Mr. N. Pachisia and Mrs. S. Basu De as the Members of the said Committee. The recommendations made by the Audit Committee were accepted by the Board.

Composition of Nomination and Remuneration Committee

The Nomination and Remuneration Committee of the Company, at present comprises of Mr. H. M. Parekh as the Chairman of the Committee, Smt. P. D. Kothari, Dr. H. P. Kanoria and Mr. N. Pachisia as the Members of the said Committee. The criteria for performance evaluation of Board, Committees and the Directors are laid down under the Nomination and Remuneration Policy of the Company. Remuneration Policy for Directors, Key Managerial Personnel and other employees may be accessed on the Company's website at the link:http://www.gillandersarbuthnot. com/policies/ nr policy.pdf

Composition of Stakeholders Relationship Committee

The Stakeholders Relationship Committee of the Company, at present comprises of Mr. H. M. Parekh as the Chairman of the Committee, Mr. A. K. Kothari, Smt. P. D. Kothari, and Mr. D. K. Sharda as the Members of the said Committee.

Whistle Blower Policy

The Company has in place a Whistle Blower Policy in compliance with the provisions of the Act and the Listing Agreement. The said Policy provides for a formal vigil mechanism for all employees and Directors of the Company to report to the Chairman of the Audit Committee of the Company genuine concerns or grievances about the unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct. The Policy on whistle blower may be accessed on the Company's website at the link: http://www.gillandersarbuthnot. com/policies/wb policy.pdf. Your Board affirms that no person has been denied access to the Chairman of the Audit Committee.

Meetings of the Board

Five Meetings of the Board of Directors were held during the year. For further details, please refer to Clause IID of the report on Corporate Governance, which forms part of this Annual Report.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

i) A Corporate guarantee of USD 13.0 Million was given to Axis Bank Ltd., Kolkata for issuing SBLC(Stand By Letter of Credit) by mortgaging tea estates of the Tea Division for availing loan of USD 12.75 million from Axis Bank, Singapore, by Gillanders Holdings (Mauritius) Limited, Mauritius, a wholly owned Subsidiary of the Company.

ii) An amount of USD 10,000 was invested to purchase 10,000 equity shares of Gillanders Holdings (Mauritius) Limited, Mauritius.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act, are provided in Annexure III to this Report.

Extract of Annual Return

Extract of Annual Return of the Company is annexed herewith and marked as Annexure IV.

Particulars of Employees and related disclosures

No employee draws remuneration in excess of the limits provided in the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Rule 5(2) of the said Rules state that the Board's Report shall include a statement showing the name of every employee, who, if employed throughout the financial year, was in receipt of remuneration for that year, which, in aggregate, was not less than Rs.60 lakhs and if employed, for part of the financial year, was in receipt of remuneration for any part of that year, at a rate which, in the aggregate was not less than Rs.5 lakhs per month.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in Annexure V to this Report.

MATERIAL CHANGES

There have been no material changes and commitments affecting the financial position of the Company since the close of the financial year i.e., 31st March, 2015. Further, there has been no change in the nature of business of the Company.

GENERAL

Your Directors states that no significant or material orders were passed by the Regulators or Courts or Tribunals which may impact the going concern status and Company's operations in future and that there was no case filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

ACKNOWLEDGEMENT

The Directors would like to record their appreciation for the co- operation and support received from the employees, shareholders, banks, government agencies and all stakeholders.

For and on behalf of the Board

A. K. Kothari Chairman Kolkata, 29th May, 2015.




Mar 31, 2013

Dear Members

The Directors have pleasure In presenting their Annual Report on the affairs of the Company together with the Audited Accounts for the financial year ended March 31,2013.

FINANCIAL RESULTS

Rs. in Lakhs The financial results for the year are as under:

Paticulars 2012-13 2011-12

Profit Before Depreciation, Interest & Tax (PBD1T) 82,77.93 38,03.00

Intrest/Financial Charges 28,48.14 28,71.18

Profit Before Depreciation and Tax (PBDT) 54,29.79 9,31.82

Depreciation / Amortisation 24,90.75 24,61.97

Profit Before Fax {PBT) 29,39.04 (15,30.15)

Taxation Charge

- current Tax 5,50.00 46.70

- Deferred Tax 3,30.00 (6,50.00)

Profit After Tax (PAT] 20.59.04 (9,26.85)

Balance brought forward 44,98.17 55,67.64

Balance available for appriciation 65,57.21 46,40.79

Appropriation

Proposed Dividend on:

8% Redeemable Cumulative Preference Shares of Rs. 100 each 16.00 16.00

Ordinary Shares of Rs. 10 each 4,26.85 1.06.71

Corporate Dividend Tax 75.26 19.91

Transfer to General Reserve 3,00.00 -

Surplus carried to Balance Sheet 57,39.10 44,98.17

65,57.21 46,40.79

Earnings, per Ordinary Share (Rs.)

- Basic 9.56 (4,43)

- Diluted 9.56 (4.43)

Dividend per Ordinary Share (Rs.) 2.00 0.5O



FINANCIAL ANALYSIS AND REVIEW OF OPERATIONS

For the financial year 2012-13, your Company reported a net profit of Rs. 20,59.04 Lakhs against loss of Rs. 9,26.85 Lakhs during the previous year Total income from operattons has increased to Rs. 7,82,41.62 lakhs during tha year under review from Rs. 6,73,17.69 Lakhs In the previous year. Operational matters have been discussed under Management Discussion and Analysis.detailed in appropriate part of this Report.

DIVIDEND

Your Directors recommend the followirrg dividends:

a) Dividend @ Rs. 8 per Share on 2,00,000 8% Redeemable Cumulative Preference share on 1O0 each of the Company, entailing an outflow of Rs. 16.00 Lakhs.

b) Dividend @ Rs. 2 per Share on 2,13,42,346 Fully paid up Ordinary Shares of Rs. 10 each of the Company, entailing an outflow of Rs. 426.85 Lakhs.

DIRECTORS

In the ensuring Annual General Meeting of the Company, Smt. P.D Kothari and Mr, P; K, Khaitan retires by rotation under Articles 109 and 110 of the Articles of Association of the Company, and being eligible offer themselves, for re-appolntrrant.

At the Board Meeting held on February ] X 2D 13, Mr. D. KL Sharda was re-appointed as Managing Director, designated as ''Managing Director & Chief Executive Officer {CEO)'' of the Company for a period of one year with effect from April 01, 2013. The said re-appointment is subject to the approval of the members of the Company in the ensuring Annual General Meeting.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 317(2AA) of the Companies Act, 1936, with respect to Directors'' Responsibility Statement your Directors confirm having:

a) Followed in the preparation of the Annual Accounts the applicable accounting standards with proper explanation relating to material departures, if any;

b) 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 your Company at the end of the financial year and of the profit of your Company for that period:

c) Taken proper and sufficient care for the maintenanoe of adequate accounting records, in accordance with the provisions of the companies Act 1956, for safeguarding the assets of your Company and for preventing and detecting fraud and other Irregularities; and

d) Prepared the Annual Accounts on a ''goiig concern'' basis,

AUDITOR''S REPORT

Auditors'' Report to the members of the Company does not Maintain any qualification or adverse remark, Financial Statements and the notes thereon is self explanatory and need no further explanation,

AUDITORS

Messrs. Singhi & Co., Chartered Accountants, Kolkata, who retires after the- conclusion of the forthcoming Annual General Meeting, and being eligible, offer themselves, for re- appointment,

Messrs- Dutta, Ghosh & Associates, Charted Accountants, Kolkata, the Branch Auditor of the GIS Cotton Mill unit of Textile Division of the Company, retire after the conclusion of the forthcoming Annual General Meeting, and being eligible, offer themselves, for re-appointment,

Messrs. Kothari & Company, Chartered Accountants Kolkata, the Branch Auditor of the Engineering (MICCO) Division of the Company, retire After the conclusion of the forthcoming Annual General Meeting, and being eligible, after themselves, for re- appointment.

A certificate under sub-section {IB} of Section 224 of the Companies Act, 1956, has been obtained from each of them.

COST AUDIT

The Ministry of Corporat Affairs, Government of India, has approved the reappointment of the following Cost Auditors for conducting Cost Audit for the financial year 2012-13:

i) Textile Division- M/s.D.Sabyasachi & Co., Kolkata;

ii) Tea Division- M/s B.Ray & Associates, Kolkata; and

iii) Chemical (Waldies) Division- M/s.Rammani Sarkar & Co., Hooghly.

CORPORATE GOVERHAHCE

The Report on Corporate Governance duty certified by CS Deepak Kumar Khaitan, a practicing Company Secretary, confirming compliance with the conditions: stipulated under douse 49 of the Listing Agreement, which forms part of the Annual Report, Is attached to this Report,

FIXED DEPOSIT

As on March 31, 2013 an amount of Rs. 2,508.26 lakhs was outstanding as fixed deposits received from the public and Shareholders of your Company, Matured fixed deposit amounting to Rs. 3.60 lakhs was unclaimed as on the said date.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956, read with Companies {Disclousure of particulars in the Report of the Board of Directors) Rules, 1988 regarding conservation of energy, technology absorption and foreign exchange earnings and outgo is given in the statement annexed (Annexure l) hereto and forming part of the Report.

PARTICULARS OE EMPLOYEES

No employee falls under the purveiw of Sub-section (2A) of Section 217 of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975,as amended.

ACKNOWLEDGEMENT

Your Directors would like to record their appreciation for the co- operation and support received from dne employees, shareholders, hanks,. Government agencies end all stakeholders.



For and on behalf of the Board

A, K. Kothari

Kolkata,May 29,2013. Chairman


Mar 31, 2012

The Directors have pleasure in presenting their Annual Report on the affairs of the Company together with the Audited Accounts for the financial year ended March 31, 2012.

FINANCIAL RESULTS

(Rs. in lakhs)

The Financial results for the year are as under :

PARTICULARS 2011-12 2010-11

Profit Before Depreciation, Interest & Tax (PBDIT) 3,803.85 10,880.74

Interest / Finance Charges 2,872.03 1,975.37

Profit Before Depreciation and Tax (PBDT) 931.82 8,905.37

Depreciation / Amortization 2,461.97 2,244.87

Profit Before Tax (PBT) (1,530.15) 6,660.50 Taxation Charge

- Current Tax 46.70 1,308.20

- Deferred Tax (650.00) (67.00)

Profit After Tax (PAT) (926.85) 5,419.30

Balance brought forward 5,567.64 2,083.15

Balance available for appropriation 4,640.79 7,502.45

Appropriations

Proposed Dividend on:

8% Redeemable Cumulative Preference Shares of Rs. 100/- each 16.00 16.00

Ordinary Shares of Rs. 10/- each 106.71 960.41

Corporate Dividend Tax 19.91 158.40 Transfer to :

Preference Shares Redemption Reserve - 200.00

General Reserve - 600.00

Surplus carried to Balance Sheet 4,498.17 5,567.64

4,640.79 7,502.45

Earnings per Ordinary Share (Rs.)

- Basic (4.43) 25.31

- Diluted (4.43) 25.31

Dividend per Ordinary Share (Rs.) 0.50 4.50

FINANCIAL ANALYSIS AND REVIEW OF OPERATIONS

During the financial year 2011-12, your Company reported a loss of Rs. 926.85 lakhs against profit of Rs.5,419.30 lakhs during the previous year. The loss was due to adverse economic conditions and some unforeseen disruption of operations, which resulted in loss of production and operational income. Operational matters have been discussed under 'Management Discussion and Analysis,' detailed in appropriate part of this Report.

DIVIDEND

Your Directors recommend the following dividends:

a) Dividend @ Rs. 8/- per Share on 2,00,000 8% Redeemable Cumulative Preference Shares of Rs. 100/- each of the Company, entailing an outflow of Rs. 16.00 lakhs.

b) Dividend @ Re. 0.50 per Share on 2,13,42,346 fully paid up Ordinary Shares of Rs. 10/- each of the Company, entailing an outflow of Rs. 106.71 lakhs.

MANAGEMENT DISCUSSION AND ANALYSIS

The industry structure, development, performance, opportunities, threats and outlook of each activities, internal control systems and industrial relations have been discussed in paragraphs to follow.

Tea Division

India was expected to achieve production of 1 billion kgs of tea in 2011, but due to early onset of winter in north-east regions, and rains in southern regions during October to December, industry could produce 988 million kilograms (mkg) of tea in 2011, an increase of 2.3% compared to last year.

Production in Kenya and Sri Lanka, the largest exporters, also showed a declining trend due to adverse climatic conditions. However, exports from India during 2011 stood at 193 mkg against 222 mkg in 2010 mainly due to Western sanctions against Iran and political instability in West Asia and North African countries. Increased production along with decrease in export has created pressure on price of tea but it has been minimized due to surge in domestic demand.

In spite of adverse impact due to labour and political unrest in the gardens located in West Bengal, Tea Division has produced 9.15 million kgs of Tea during the year under review, which is marginally higher than 9.01 million kgs. during the last year. Exports were made to countries like Sri Lanka, Dubai, Iran and Russia, which has resulted in enhanced export sales during the year under review. Your Division is exploring other potential markets and taking measures to strengthen the existing market and is confident of increasing export sales in coming year.

Packet segment is gradually increasing its presence in markets by strengthening branch operations, operational logistics, warehousing facilities and is expected to further penetrate the markets in the coming years by enhancing its marketing tools. However, decrease in price coupled with increase in cost, including wages and other inputs, has created pressure on profit margin of the division.

During the current year, with a minimal carry forward and increase in demand the prices are expected to be buoyant, particularly for quality tea. However, increase in wages and other input cost will continue to put pressure on margin. Your Directors expects the Division to do relatively well in the coming year.

All the tea estates of the Company are ISO 9001:2008 and Hazard Analysis and Critical Control Points (HACCP) certified.

Engineering (MICCO) Division

This Division of your Company is mainly involved in infrastructural work in Steel and Power Sectors. MICCO is a prestigious name in the Steel Sector and enjoys preference as partner by national and global players in the sector. Apart from Gas holders and Reheating Furnaces, where this Division has created a niche, it has also established itself as a trusted name in Casters, Mills and Coke Oven Plants.

During the year under review, the global and national economy has not been encouraging, which resulted in slow projects execution. The performance of your Division was also adversely affected due to fire in one of the sites. In spite of tough market scenario, your division has a healthy order book position.

The outlook for Steel Industry is cautious due to the markets continued financial uncertainty and volatility. The global steel sector is expected to grow, although at a lower rate. In India, however, demand for steel from the domestic sector especially for infrastructure is creating a positive outlook as India is expected to perform better than most world economies. Power Sector is also expected to do reasonably well in the coming year.

Your Division is continuously putting in efforts to improve the growth trajectory through internal assessment and seeking advice from leading consultants in the field. Steps have been taken to reorganize your Division, establish new partners in allied fields, locate new areas of operation and to strengthen the existing collaborations. The initial results of such initiatives are encouraging and the division has already entered into several tie-ups in different products and few are in the pipeline, which shall change the range and profile of your division for a sustainable growth in near future. MICCO Division is equipped to harness the opportunities and expects a stable performance in the coming year.

Textile Division

During the year, Spinning Industry witnessed unprecedented and one of the worst crisis in the past several decades.

As a normal practice, the Industry built up requisite inventory of good quality cotton during the season as good quality cotton is not adequately available during the off season. However, the prices of raw cotton and other fibers, which had peaked during the end of last year, crashed during the year, resulting in huge losses on account of raw material and finished goods inventory.

The said event also led to fall in demand for yarn both in domestic and international markets resulting in huge inventory with the mills, which has put tremendous pressure on yarn prices and margins.

As reported last year, the frequent changes in the policy guidelines and intervention of the government has created an uncertainty in the market, which is adversely affecting the outlook and growth prospect of the industry. The Industry looks forward to the government to draw up a long term policy guidelines taking into account the benefit of the entire textile value chain.

Apart from the above, the performance of Textile Division was also affected by loss of production at GIS Cotton Mill unit due to labour unrest for two and half months. In North India Spinning Mill unit there was total breakdown of captive power plant along with some machineries, which took about four months to be replaced/repaired, resulting in non-optimal use of production capacity. The production during the year under review was 15,066 MT, which is lower than last year.

The current year also seems to be difficult due to weak global and Indian economy. The cotton crop at 347 lakhs bales for the year 2011-12 is estimated to be higher than last year. However, due to huge exports the carry forward stock for the next season is expected to be very low. In spite of all odds, your Directors are hopeful of reasonable performance in the current year.

Chemical (Waldies) Division

Waldies Division is engaged in the business of manufacture and marketing of Lead Oxides and Stabilizers for PVC Industry.

During the year under review, the Industry witnessed uncertain market environment and slow growth. In spite of that, this Division has achieved satisfactory increase in profitability. Continuous efforts are being made for further improvement in the operations of the Division. The outlook of the performance for the coming year is reasonable.

Waldies Division continues to enjoys ISO 19001 certification for its Quality Management Systems and ISO 14001 certification for its Environment Management Systems and OHSAS 18001 for its occupational health and safety management systems.

Trading Division

During the year under review, the turnover of this Division was marginally low compared to previous year primarily due to fall in sale of cement paints.

Your Division now owns a Brand known by the name 'GILLARCO' and has plans to market and sell different products under the said Brand name in the future. It has plans to expand its operational base by foraying into marketing and selling of Abrasive Sheets in automotives and decorative Segments. Your Directors expect that this Division will yield better results in the coming year.

Property Division

Increase in occupancy has yielded higher rental income for property Division for the year under review.

Your Division has a Fire Safety Policy, which is reviewed from time to time. Latest fire fighting equipments are in place in 'Gillander House' and fire safety norms are strictly adhered to. Your Directors believe that with continuous improvement of facilities and safety, this Division will be benefitted in the long term.

Internal Control System and their adequacy

Your Company has proper and adequate system of internal controls. Audit of various divisions, units, factories, sites, branches and its corporate offices are conducted by Independent professional firms of Chartered Accountants and reports thereon are reviewed and discussed by the Audit Committee of the Board of Directors and corrective action, as deemed necessary, are taken. Procedures have been laid down by your Company to safeguard and protect all assets and ensure that the transactions are authorized, recorded and reported correctly.

Human Resources and Industrial Relations

Your Company has laid down the processes for attracting, retaining and rewarding talent as it acknowledges the importance of good Human Resource. Congenial environment is being maintained and recreation activities are sponsored by your Company. Industrial relations were good except an incident of labour unrest.

Caution Statement

Management Discussion and Analysis Report contains forward- looking statements, which are based on certain assumptions and expectations of future events. The Company's actual results and performance may differ from those projected due to unforeseen circumstances viz., political, economic etc. The Company assumes no responsibility to publicly amend, modify or revise any such statements on the basis of subsequent developments, information or events. Readers are advised to apply their own diligence and independent judgment.

DIRECTORS

During the year under review, Mr. S. Lahiri resigned from the Board with effect from February 14, 2012. Mr. A. Mallick resigned from the Board with effect from March 31, 2012.

The Board wishes to place on record its deep sense of appreciation and gratitude for the valuable contribution, guidance and advice received from them.

Mr. J. N. Godbole and Mr. A. K. Kothari retire by rotation under Articles 109 and 110 of the Articles of Association of the Company, and being eligible offer themselves, for re- appointment.

Mr. N. Pachisia has been appointed as an Additional Director with effect from August 16, 2011 to hold such office till the conclusion of the ensuing Annual General Meeting. Notice under Section 257 of the Companies Act, 1956 has been received from a member proposing his name for appointment as Director of your Company in the forthcoming Annual General Meeting. The Board recommends his appointment as Director since his appointment will be beneficial to the Company.

At the Board Meetings held on February 14, 2012 and May 29, 2012, Mr. D. K. Sharda was re-appointed as Managing Director of the Company for a period of one year, with effect from April 01, 2012 and designated as Managing Director & Chief Executive Officer (CEO) of the Company respectively. The said re- appointment is subject to the approval of the members of the Company in the ensuing Annual General Meeting.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors' Responsibility Statement, your Directors confirm having:

a) Followed in the preparation of the Annual Accounts, the applicable accounting standards with proper explanation relating to material departures, if any;

b) 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 your Company at the end of the financial year and of the loss of your Company for that period;

c) Taken proper and sufficient care for the maintenance of adequate accounting records, in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities; and

d ) Prepared the Annual Accounts on a 'going concern' basis.

AUDITORS' REPORT

Auditors' Report to the members of the Company does not contain any qualification or adverse remark. Financial Statements and the notes thereon is self explanatory and need no further explanation.

AUDITORS

Messrs. Singhi & Co., Chartered Accountants, Kolkata, who retires after the conclusion of the forthcoming Annual General Meeting, and being eligible, offer themselves, for re- appointment.

Messrs. Dutta, Ghosh & Associates, Chartered Accountants, Kolkata, the Branch Auditor of the GIS Cotton Mill unit of Textile Division of the Company, retire after the conclusion of the forthcoming Annual General Meeting and, being eligible, offer themselves, for re-appointment.

Messrs. Bagree & Co., Chartered Accountants, Kolkata, who retires after the conclusion of the forthcoming Annual General Meeting have sent a letter expressing their unwillingness to be re-appointed as Branch Auditor of Engineering (MICCO) Division of the Company. A Special Notice has been received from a member proposing the name of Messrs. Kothari & Company, Chartered Accountants, Kolkata, as the Branch Auditor of Engineering (MICCO) Division of the Company in place of the retiring Auditor in the ensuing Annual General Meeting.

A certificate under sub-section (1B) of Section 224 of the Companies Act, 1956, has been obtained from each of them.

COST AUDIT

The Ministry of Corporate Affairs, Government of India, has approved the re-appointment of the following Cost Auditors for conducting Cost Audit for the financial year 2011-12:

i) Textile Division - M/s. S. Gupta & Co., Kolkata;

ii) Tea Division - M/s. B. Ray & Associates, Kolkata & M/s. DGM & Associates, Kolkata; and

iii) Chemical (Waldies) Division - M/s. S. Gupta & Co., Kolkata. CORPORATE GOVERNANCE

The Report on Corporate Governance duly certified by CS Deepak Kumar Khaitan, a practicing Company Secretary, confirming compliance with the conditions stipulated under Clause 49 of the Listing Agreement, which forms part of the Annual Report, is attached to this Report.

FIXED DEPOSIT

As on March 31, 2012 an amount of Rs. 2,115.04 lakhs was outstanding as fixed deposits received from the public and shareholders of your Company. No matured fixed deposit was unclaimed as on the said date.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956, read with Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 regarding conservation of energy, technology absorption and foreign exchange earnings and outgo is given in the statement annexed (Annexure I) hereto forming part of the Report.

PARTICULARS OF EMPLOYEES

No employee falls under the purview of Sub-section (2A) of Section 217 of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended.

ACKNOWLEDGEMENT

Your Directors would like to record their appreciation for the co-operation and support received from the employees, shareholders, banks, Government agencies and all stakeholders.

For and on behalf of the Board

A. K. Kothari

Kolkata, May 29, 2012. Chairman


Mar 31, 2011

Dear Members,

The Directors have pleasure in presenting their Annual Report on the affairs of the Company together with the Audited Accounts of the Company for the financial year ended March 31, 2011.

FINANCIAL RESULTS

(Rs. in lakhs)

The Financial results for the year are as under :

PARTICULARS 2010-11 2009-10

Profit before Depreciation, Interest & Tax (PBDIT) 10,708.14 7,765.13

Interest / Finance Charges 1,802.77 1,764.38

Profit before Depreciation and Tax (PBDT) 8,905.37 6,000.75

Depreciation / Amortisation 2,244.87 2,164.68

Profit before Tax (PBT) 6,660.50 3,836.07

Taxation Charge

- Current Tax 1,308.20 630.00

- Deferred Tax (67.00) 670.00

Profit After Tax (PAT) 5,419.30 2,536.07

Balance brought forward 2,083.15 895.30

Balance available for appropriation 7,502.45 3,431.37

Appropriations

Proposed Dividend on:

8% Redeemable Cumulative Preference Shares of Rs. 100/- each 16.00 16.00

Ordinary Shares of Rs. 10/- each 960.41 711.41

Corporate Dividend Tax 158.40 120.81

Transfer to :

Preference Shares Redemption Reserve 200.00 --

General Reserve 600.00 500.00

Surplus carried to Balance Sheet 5,567.64 2,083.15

7,502.45 3,431.37

Earnings per Ordinary Share (Rs.)

- Basic 25.31 11.80

- Diluted 25.31 11.80 Dividend per Ordinary Share 4.50 5.00

FINANCIAL ANALYSIS AND REVIEW OF OPERATIONS

Despite the global economic slowdown, your Company has been able to report sizeable increase in sales, profits and net worth due to proactive approach and diversified businesses. Total revenue has increased to Rs. 75,284 lakhs during the year under review from Rs. 62,203 lakhs in the previous year. The profit before tax and profit after tax during the year have increased significantly by 73.63% and 113.69% respectively, as compared to the previous year. Operational matters have been discussed under 'Management Discussion and Analysis,' detailed in appropriate part of this Report.

BONUS ISSUE - INCREASE IN SHARE CAPITAL

The Board of Directors at their meeting held on September 16, 2010 had issued and allotted 71,14,115 fully paid up Ordinary shares of Rs.10/-each, as Bonus Shares to those members of the Company who were entitled thereto by capitalising general reserve.

Post Bonus Issue, the Issued, Subscribed and Paid-up Share Capital of the Company increased to Rs.23,34,23,460/- divided into 2,13,42,346 Ordinary Shares of Rs.10/- each and 2,00,000 8% Cumulative Redeemable Preference Shares of Rs. 100/- each. The said Bonus shares have been listed and admitted to trading in National Stock Exchange of India Limited, Bombay Stock Exchange Limited and the Calcutta Stock Exchange Limited.

DIVIDEND

Your Directors are pleased to recommend the following dividends:

a) Dividend @ Rs. 8/- per Share on 2,00,000 8% Redeemable Cumulative Preference Shares of Rs. 100/- each of the Company, entailing an outflow of Rs. 16.00 lakhs.

b) Dividend @ Rs. 4.50/- per Share on 2,13,42,346 fully paid up ordinary shares of Rs. 10/- each of the Company, entailing an outflow of Rs. 960.41 lakhs.

DIRECTORS

M r. D. K. Sharda and M r. A. Mallick have been re-appointed as Managing Director and Executive Director & CEO respectively for a further period of one year with effect from April 01, 2011, subject to the approval of the members of the Company in the ensuing Annual General Meeting.

Mr. S. Lahiri and M r. H. M. Parekh retire by rotation under Articles 109 and 110 of the Articles of Association of the Company, and being eligible offer themselves, for re-appointment.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors' Responsibility Statement, it is hereby confirmed that:

a) in the preparation of the Annual Accounts for the year ended March 31, 2011, the applicable accounting standards read with requirements set out under Schedule VI to the Companies, Act, 1956, have been followed and there are no material departures from the same;

b) your 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 as at March 31, 2011 and of the profit of the Company for the year ended on that date;

c) your Directors have taken proper and sufficient care for the maintenance of adequate accounting records, in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing fraud and other irregularities; and

d) your Directors have prepared the annual accounts on a 'going concern' basis.

AUDITORS' REPORT

Auditors' Report to the members of the Company does not contain any qualification or adverse remark. The Notes to Accounts forming part of the financial statements are self explanatory and needs no further explanation.

AUDITORS

Messrs. Singhi & Co., Chartered Accountants, Kolkata, who retires after the conclusion of the forthcoming Annual General Meeting and being eligible, offer themselves, for re- appointment.

Messrs. Bagree & Co., Chartered Accountants, Kolkata, the Branch Auditor of Engineering (MICCO) Division of the Company and Messrs. Dutta, Ghosh & Associates, Chartered Accountants, Kolkata, the Branch Auditor of the Textile (GIS Cotton Mill) Division of the Company, retire at this meeting and, being eligible, offer themselves, for re-appointment for the respective Divisions.

A certificate under sub-section (1B) of Section 224 of the Companies Act, 1956, has been obtained from each of them.

COST AUDIT

The Ministry of Corporate Affairs, Government of India, by their Orders has directed audit of cost accounts maintained by the Company in respect of its Textile, Tea and Chemicals (Waldies) divisions on a yearly basis. In terms of the said Orders, Cost Audits are conducted by three firms of Cost Accountants, who are appointed with the approval of the Ministry of Corporate Affairs, Cost Audit Branch.

CORPORATE GOVERNANCE

The Report on Corporate Governance duly certified by a practicing Company Secretary confirming compliance with the conditions stipulated under Clause 49 of the Listing Agreement, which forms part of the Annual Report, is attached to this Report.

FIXED DEPOSIT

As on March 31, 2011 an amount of Rs. 1,925.78 lakhs was outstanding as fixed deposits received from the public and shareholders of your Company. No matured fixed deposit was unclaimed as on the said date.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in accordance with the provisions of Section

217(1)(e) of the Companies Act, 1956, read with Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 regarding conservation of energy, technology absorption and foreign exchange earnings and outgo is given in the statement annexed (Annexure I) hereto forming part of the Report.

PARTICULARS OF EMPLOYEES

No employee falls under the purview of Sub-section (2A) of Section 217 of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended.

ACKNOWLEDGEMENT

Your Directors would like to record their appreciation for the co-operation and support received from the employees, shareholders, banks, Government agencies and all stakeholders.

For and on behalf of the Board

A. K. Kothari

Kolkata, May 30, 2011. Chairman

 
Subscribe now to get personal finance updates in your inbox!