Directors Report of Gontermann Peipers (India) Ltd.
Mar 31, 2016
Dear Members,
The Directors are pleased to present the Forty Seventh Annual Report together with the Audited Financial Statements of your Company for the financial year ended 31st March, 2016. The summarized financial performance of your Company for the financial year ended 31st March, 2016 is as follows:-
FINANCIAL RESULTS
(Rs in Lacs)
|
Particulars |
Year ended 31st March, 2016 |
Year ended 31st March, 2015 |
|
Total Revenue |
9,240.77 |
16,202.20 |
|
Total Expenditure |
12,887.02 |
19,373.16 |
|
Profit/(Loss) before Exceptional and Extraordinary Item & Tax |
(3,646.26) |
(3,170.96) |
|
Add: Exceptional Items |
11.12 |
3.88 |
|
Profit/(Loss) before Tax |
(3,657.37) |
(3,174.84) |
|
Provision for Taxation |
||
|
- Current Tax |
- |
- |
|
- Deferred Tax |
(1,126.45) |
(1,059.28) |
|
Net Profit/(Loss) after Taxation |
(2,530.93) |
(2,115.56) |
During the year under review, the total Income was Rs. 9,240.77 Lacs as against Rs. 16,202.20 Lacs in the previous year representing decrease in total income. Net loss after providing for interest, depreciation and tax increased to Rs. 2,530.93 Lacs as against net loss of Rs. 2,115.56 Lacs during the previous year.
OPERATIONAL HIGHLIGHTS
During the year under review, your Company continued to face hurdles from all corners. The overall weak economic conditions, rising cost of production, liquidity crunch, borrowing costs and other global factors posed hardships on the Company.
The Promoter have extended their financial and technical support from time to time. The Company has invested these funds towards improvement in infrastructure, repayments of debts, working Capital requirement and loss funding.
CAST ROLL DIVISION
Production during the year under review decreased to 5309 MT (Metric Ton) as against 8573 MT during the year 2014-15. Cast Roll Sales decreased to 5481 MT as against 8396 MT during the year 2014-15. Consequently, the total revenue from the Cast Roll Division decreased to Rs. 7,093.40 Lacs as compared to Rs. 11,613.50 Lacs in the previous year.
FORGE ROLL DIVISION
Production during the year under review decreased to 873 MT as against 955 MT during the previous year. Forge Roll sales decreased to 897 MT as against 936 MT in the previous year 2014-15. Consequently, the total revenue from the Forged roll division was Rs. 2,003.49 Lacs compared to Rs. 2,120.67 Lacs in the previous year which reflects a marginal decrease.
EXPORT
During the year under review, the Company exported 1513 MT of Cast Rolls as compared to 3120 MT during the previous year and exported 186 MT of Forge Rolls as compared to 179 MT during the previous year. Your Company is exploring new markets for Cast Rolls in Turkey, UAE, Qatar, Nigeria, Iran, Egypt, Bangladesh, Oman, AHMSA (Mexico) while strengthening its presence in the existing markets.
DIVIDEND
In view of losses incurred and requirement of capital, considering the capital intensive nature of the industry, for working of the Company, your Directors did not recommend any dividend for the financial year 2015-16.
TRANSFER TO RESERVES
In view of the losses incurred by the Company during the financial year 2015-16 , no amount has been proposed to be carried to the General Reserve.
SHARE CAPITAL
The Authorized Capital and Paid up Share Capital as on 31st March, 2016 was Rs. 3,000.00 Lacs and Rs. 2,282.44 Lacs respectively.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report except as stated in the report.
CHANGE IN NATURE OF BUSINESS, IF ANY
During the year there was no change in the nature of business of the Company.
EROSION OF NET WORTH
As reported earlier in the financial year 2013-14, the accumulated losses resulted in erosion of over 50% of the peak net worth during the immediately preceding four financial years, your Company has become a ''Potentially Sick Industrial Company'' in terms of the provisions of Section 23 of Sick Industrial Companies (Special Provisions) Act, 1985 and the Shareholders of your Company vide Post Ballot dated 8th November, 2014 had considered and approved that the Company is a Potentially Sick Industrial Company and subsequently the same was intimated to the Board for Industrial & Financial Reconstruction (BIFR).
Further, as per the Audited Financial Statements for the financial year 2015- 16, the accumulated losses of the Company as on 31st March, 2016 are in excess of its entire net worth as on the same date, as such the Company has become a Sick Industrial Company and the necessary reference to be made with the Board for Industrial & Financial Reconstruction (BIFR) in terms of the provisions of Section 15(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 (SICA), for determination of measures for its rehabilitation. The Company is in the process of making the necessary statutory compliances.
SUBSIDIARY COMPANY/JOINT VENTURE COMPANY/ASSOCIATE COMPANY
The Company does not have any Subsidiary Company/Joint Venture Company/Associate Company in terms of provisions 134(3) of the Companies Act, 2013 read with Rule 8(5)(iv) of Companies (Accounts) Rules, 2014 and hence no disclosure is required.
PUBLIC DEPOSIT
During the year, your Company has not accepted/ received any deposit pursuant to section 73 of Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014.
CORPORATE DEBT RESTRUCTURING
Your Company continues to be under CDR Scheme as reported in the previous year and is making repayments as laid down in the terms and conditions of the Scheme.
SCHEME OF AMALGAMATION
As reported last year, your Directors as well as the Shareholders (Both Equity Shareholders and 6% Cumulative Optionally Convertible Redeemable Preference Shareholder at their Court Convened Meeting held on 28th March, 2015) of the Company has approved the Scheme of Amalgamation of Geetapuram Port Services Limited (âGPSL or the Transferor Company No.1â) and its wholly owned subsidiary North East Natural Resources Private Limited (âNENRPL or the Transferor Company No.2â) with Gontermann-Peipers (India) Limited (GPIL or the Transferee Companyâ).
Necessary approval for approving the said Scheme is pending before the Hon''ble High Courts. The amalgamation, if approved will be advantageous and beneficial to all stakeholders of the Company.
EXTENSION OF ANNUAL GENERAL MEETING
In accordance with the provisions of Section 96 read with Section 129 of the Companies Act, 2013, the Annual General Meeting of the Company for the financial year 2015-16 was due to be held on 30th September, 2016. Since the Company is in process of Amalgamation, the Board of Directors at their meeting held on 20th May, 2016 directed the Company to pray for extension of holding the Annual General Meeting for the financial year 2015-16 by three months i.e., up to 31st December, 2016 to the Registrar of Companies, West Bengal. Necessary approval was granted by the Registrar of Companies, West Bengal vide their letter dated 5th July, 2016.
INTERNAL FINANCIAL CONTROL
The Internal Financial Control with reference to the Financial Statements are considered to be commensurate with the size, scale and complexity of the operations of the Company. All Operations are executed through Standard Operating Procedures (SOPs) in all functions activities for which key manuals have been put in place. The manuals are operated and validated periodically. Approvals of all transactions is ensured through a pre approved Delegation of Authority (DOA) Schedule which is in built into the SAP system.DOA is reviewed periodically by the management and compliance of DOA is regularly checked and monitored by the Auditors. The Company''s Books of Accounts are maintained in SAP and transactions are executed through SAP (ERP) setup to ensure correctness/effectiveness of all transactions, integrity and reliability of reporting.
The Internal Audit team monitors and evaluates efficacy and adequacy of internal control system in the Company. Based on the report of internal auditors, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board on quarterly basis.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS OF THE COMPANY
There are no such significant and material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status and the future operations of the Company during the year under review.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Appointment(s)
During the year under review, Mr. Dwijen Lahiri was appointed as an Additional Director, Whole Time Director and Key Managerial Personnel (''KMP'') of the company by the Board of Directors with effect from 1st April, 2015. Subsequently, the Shareholders of the Company at their Annual General Meeting held on 30th December, 2015 approved the appointment of Mr. Dwijen Lahiri as Director and Whole Time Director (''KMP'') of the company. Further, Dr. Buddhadeb Duari, who was appointed as Additional Director and Non-Executive Director (Independent) of the company by the Board of Directors at their meeting held on 31st March, 2015 was also approved by the Shareholders of the Company at their Annual General Meeting held on 30th December, 2015 as Non-Executive Director (Independent) of the company for a tenure of five (5) years with effect from 31st March, 2015. The terms and conditions of appointment of Independent Director are as per Schedule IV of the Companies Act, 2013 and he has also submitted a declaration that he meets with the criteria of Independence as provided in Section 149(6) of the Companies Act, 2013.
Mr. Dwijen Lahiri, Whole Time Director, Mr. Sandip Gupta, Chief Financial Officer and Mr. Alok Kumar Samant, Company Secretary of the Company are the Key Managerial Personnelâs of your Company in accordance with the provisions of Section 2(51) and Section 203 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and SEBI (Listing Obligations and Disclosures Requirements), Regulations, 2015.
The details of remuneration paid to the Key Managerial Personnel appointed by your Company in accordance with the provision of Section 203 of Companies Act, 2013 are set out in this Report.
Resignation(s)
During the year under review, Mr. Susanta Ghosh, Managing Director & CEO and Key Managerial Personnel of the Company has resigned from the position of Managing Director & CEO with effect from 29th May, 2015 and Mr. Mahesh Trivedi, Nonexecutive (Independent) Director has resigned from the position of Non-Executive (Independent) Director with effect from 11th February, 2016. Further, Mr. Anil Sureka, Non-Executive Director of the Company has resigned from the position of Nonexecutive Director with effect from 11th August, 2016.
The Board of Directors placed on record their appreciation for the valuable contribution during their long term association with the Company.
RETIREMENT BY ROTATION
In accordance with the provisions of Section 152 of the Companies Act, 2013 and rules made there under and in terms of the Article of Association of the Company, Mr. Pramod Kumar Mittal (DIN:00772690), Non-Executive Director of the Company, is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment. Your Board of Directors recommends his re-appointment. The details of the re-appointment are set out in the notice convening the 47th Annual General Meeting of your Company.
BOARD EVALUATION
During the year under review in terms of requirement of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, the formal annual evaluation was carried out for the Board''s own performance, its committees & individual directors. The Evaluation process focused on various aspects of the functioning of the Board and Committees such as composition of the Board and Committees, experience and competencies, performance of specific duties and obligations, governance issues etc. The manner in which evaluation was carried out is stated in the Corporate Governance Report which is annexed and forms a part of this report.
The Board approved the evaluation made by Nomination and Remuneration Committee of the Board of Directors.
MEETING OF THE BOARD AND AUDIT COMMITTEE
The details of the number of Board and Audit Committee Meetings of the Company are set out in the Corporate Governance Report which forms part of this report. The intervening gap between the meetings was within the period prescribed by the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015 .
COMPOSITION OF AUDIT COMMITTEE AND OTHER COMMITTEE
The Composition of Audit Committee and other Committees is provided in the Corporate Governance Report forming part of this Report.
SEPARATE MEETING OF INDEPENDENT DIRECTORS
Pursuant to the provisions of Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, a separate meeting of the Independent Directors was held on Tuesday, the 29th day of March, 2016. In the said meeting the Directors have reviewed the performance of Board and its Committees, Chairman of the Board, Nonexecutive Directors and further assessed the quality, quantity and the timeliness of flow of information between the Management and Board of the Company.
DECLARATION OF INDEPENDENCE BY THE INDEPENDENT DIRECTORS
Your Company has received declarations from all the Independent Directors that they meet the criteria of Independence as laid down under the Companies Act, 2013 read with Schedule IV and Rules made there under, as well as SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015.The Board considered the independence of each of the Independence Directors in terms of above provisions and is of the view that they fulfill the criteria of independence.
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS
The Company is required to conduct the Familiarization Programme for Independent Directors (IDs) in terms of Regulation 25 (7) of the SEBI (Listing Obligations and Disclosure Requirements), Regulation, 2015 to familiarize the Independent Directors about the Company and their roles, rights, responsibilities in the Company, nature of the industry in which Company operates, business model of the Company and other related matters. During the year under review, the Company continuously through its Board Meeting and/or Committee meeting(s) aggregating to thirteen in number facilitated Directors to familiarize about the Company performance and in turn helped them in their active participation in managing the affairs of the Company. The details of such Familiarization Programme for Directors are available on the Company''s website (URL: www.gontermann-peipers.com/investorsrelations/Directors/familiarization programme of Independent Directors).
DIRECTORâS RESPONSIBILITY STATEMENT
Pursuant to Section 134 (1)(c) of the Companies Act, 2013, your Directors confirm that:
(i) in the preparation of the annual accounts for the financial year 31st March, 2016, the applicable accounting standards have been followed and there are no material departure for the same;
(ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are responsible 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 2015-16 and of the loss of the Company for the year ended on that date;
(iii) they have 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;
(iv) they have prepared the annual accounts for the financial year ended 31st March, 2016 on a going concern basis;
(v) they have laid down internal financial controls to be followed by the company and that such internal financial control are adequate and operating effectively;
(vi) they have devised proper system to ensure compliance with the provisions of all applicable laws to your Company and that such systems were adequate and operating effectively.
EXTRACT OF THE ANNUAL RETURN
An Extract of Annual Return as on the financial year ended 31st March, 2016 in Form No. MGT-9 as required under section 92(3) of the Companies Act, 2013, read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is set out as Annexure - I to this Report and forms part of this Annual Report.
REMUNERATION POLICY
The Company has in place a Nomination and Remuneration policy duly adopted and approved by the Board. The Nomination and Remuneration Policy of the Company includes the terms and conditions for appointment and payment of remuneration to the Directors and Key Managerial Personnel (KMP) and other senior management personnel including criteria for determining qualifications, positive attributes, independence of a director as per Schedule IV of the Companies Act, 2013. The said policy has been made available on the website of the Company âwww.gontermann-peipers .comâ. The same is attached as Annexure
- II and forms integral part of this Report.
STATUTORY AUDITORS
M/s. V. Malik & Associates, Chartered Accountants, having Registration No. 000155N, issued by The Institute of Chartered Accountants of India, the Statutory Auditors of the Company hold office till the conclusion of the forty-eighth Annual General Meeting of the Company. The Board in terms of Section 139 of the Companies Act, 2013, based on the recommendation of Audit Committee, has recommended for the ratification by the Members, the appointment of M/s. V. Malik & Associates, Chartered Accountants, Statutory Auditors from the conclusion of the ensuing Annual General Meeting till the conclusion of forty-eighth Annual General Meeting of the Company.
Comments /Qualifications of the Auditors in their report and the notes forming part of the Accounts are self-explanatory:-
1. Long outstanding (i) capital advances of Rs.1,188.51 Lacs (including amount represented as trade receivable) and (ii) advances to suppliers of Rs.454.55 Lacs (including Rs.288.61 Lacs recoverable from related party) in respect of which no confirmation / acknowledgement, schedule of delivery and agreements was available and in the absence of initiation of concrete steps for recovery / settlement and non-availability of legal tenable rights and doubt about the inability to pay decides other factors, equivalent provision for advances doubtful for recovery is necessary considering the magnitude of above factors coupled with considerable delay by these parties, non-creation of such provision is contrary to the requirements of Accounting Standard-4, âContingencies and Events occurring after the Balance Sheet dateâ. The Consequential, the loss for the year would be impacted by Rs.1,643.06 Lacs.
2. The company has recognized Net Deferred Tax Asset (NDTA) of Rs. 3947.19 Lacs (including Rs.1126.45 Lacs for the year) up to 31st March, 2016 on account of unabsorbed depreciation, carried forward business losses and disallowances under Income tax laws based on the future profitability projections made by the management. The company has history of continuous losses for last 5 years and in the absence of virtual certainty supported by convincing evidence along with non-disclosure of nature of evidences supporting its recognition that sufficient taxable income will be available against which such deferred tax assets can be realized in near future, in our opinion, the recognition of deferred tax asset is in contravention to Accounting Standard-22 âAccounting for Taxes on Incomeâ and impacted the financial position to that extent.
Had the impact of our opinion above been considered.
i) The loss for the year would have been Rs.5,300.43 Lacs as against the reported loss of Rs.2,530.93 Lacs and
ii) Balancing Reserves & Surplus would have been Rs.6,951.70 Lacs as aginst the reported Reserve & Surplus of Rs.1,361.45 Lacs.
3. During the year, there are unfilled key positions in the management and non-availability of promoters-cum-directors in India and in view of only one executive director on the Board of the company, Mr. Buddhadeb Duari, Independent Director, has been authorized to sign the financial statements of the company as at 31st March 2016 for and on behalf of the Board of Directors.
Further the management representation to the above qualifications/comments are as follows:
1. As regards long outstanding (i) Capital advances of Rs.1,188.51 Lacs (including amount represented as trade receivables) and (ii) advances to suppliers of Rs.454.55 Lacs, the management is confident that the same will be adjusted against supply of materials or realization of advances.
2. As regards Net Deferred Tax (NDTA), based on the future profitability projections, management is confident of achieving the profitability in the coming years and the Company is virtually certain that there would be sufficient taxable income in the future against which the Deferred Tax Asset can be accounted for.
3. During the year, there are no such unfilled Key positions in the management of the Company and regarding non-availability of Promoter-cum-Director, there stands no provision for staying of promoter-cum-director in India in Companies Act, 2013. However, the Promoter-cum-director has attended the Board Meeting of the Company through Video Conferencing which is permissible under Companies Act, 2013.Since there is one Executive Director (Whole Time Director) in the Company and in case of absence of Managing Director & CEO, the Board of Directors of the Company has authorized Mr. Dwijen Lahiri, Whole Time Director and Mr. Buddhadeb Duari, Non-Executive Director to sign the financial statements of the Company on behalf of the Board, which is permissible under Companies Act, 2013.
COST AUDITORS
Your Board on the recommendation of the Audit Committee, has approved the appointment of M/s. Datta Chakraborty & Associates, having firm registration no. 000300 issued by The Institute of Cost & Works Accountants of India, Cost Accountants, for audit of cost records maintained by the Company for the financial year 2016- 2017. In terms of section 148 of Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014 appropriate resolution seeking your ratification of the remuneration payable to M/s. Datta Chakraborty & Associates, Cost Accountants, is included in the Notice convening the 47th Annual General Meeting of the Company.
SECRETARIAL AUDITORS
Pursuant to the provision of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Company has appointed M/s. MKB & Associates, a firm of Company Secretaries in practice to undertake the Secretarial Audit of the Company for the financial year 2015-16.The Report of the Secretarial Audit is attached herewith as Annexure-III to this report.
Below mention qualification is observed by the Secretarial Auditor in their report to which the Board has shared the following explanation:
Qualifications:
During the year under review consequent to the resignation of Mr. Mahesh Trivedi, an Independent Director, from the closing hours of 11th February, 2016, the composition of the Board of Directors was not in accordance with the provisions of the SEBI Listing Regulations.
Management Response:
After resignation of Mr. Mahesh Trivedi, an Independent Director, Management has taken great effort for getting suitable candidate in place. However, subsequent to the resignation of Mr. Anil Sureka, Non-Executive Director on 11th August, 2016 the composition of the Board of Directors stands corrected and is in accordance with the Regulations of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY
There was no such loan given, investment made, guarantee given or security provided by the Company to any entity pursuant to the provisions of section 186 of the Companies Act, 2013 during the financial year 2015-16.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on arm''s length basis. During the year under review, the Company has not entered into any contracts/arrangements/transactions with related parties which could be considered as material in accordance with the provision of Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations, 2015.
Your Board of Directors, based on the recommendation of audit committee has approved the Policy on materiality of related party transactions and dealing with related party transactions in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations, 2015 and Companies Act, 2013. The said policy is also hosted in Company''s Website www.gontermann-peipers.com.
Since all the related party transactions entered into by your Company were on Ordinary course of Business and were on arms length basis, form AOC-2 is not applicable to your Company.
CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO.
The information on conservation of energy, technology, absorption and foreign exchange earnings and outgo, as stipulated under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is annexed herewith as Annexure-IV to this Report.
RISK MANAGEMENT
The Company has in place robust risk management framework which identifies and evaluates business risk and opportunities. Pursuant to the provisions of the Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations, 2015, the Company has a Risk Management Committee of the Board, which looks after the identification of risks and their mitigation plans.
During the year under review, the Board and Management teams are embracing the concept of Enterprise Risk Management (ERM). ERM is used as a strategy decision making tool to refine management strategies and risk controls. Thereafter, the management evaluated the risk on priorities basis and their mitigation plan were formulated and implemented on regular basis. The evaluated risk along with their mitigation plan and their implementation are presented before the Board/Committee on time to time basis.
WHISTLE BLOWER POLICY & VIGIL MECHANISM
Your Company has formulated a codified Whistle Blower Policy incorporating the provisions relating to Vigil Mechanism in terms of Section 177 of the Companies Act, 2013 read with Companies (Meeting of Board and its Powers) Rules, 2014 and Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, in order to encourage Directors and Employees of your Company to escalate to the level of the Audit Committee any issue of concerns impacting and compromising with the interest of your Company and its stakeholders in any way.
Your Company is committed to adhere to highest possible standards of ethical, moral and legal business conduct and to open communication and to provide necessary safeguards for protection of employees from reprisals or victimization, for whistle blowing in good faith. The said Policy is hosted on the Company''s website: www.gontermann-peipers.com.
PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
Your Company is committed to provide and promote a safe, healthy and congenial atmosphere irrespective of gender, caste, creed or social class of the employees. The Company in its endeavour to provide a safe and healthy work environment for all its employees has developed a policy to ensure zero tolerance towards verbal, physical, psychological conduct of a sexual nature by any employee or stakeholder that directly or indirectly harasses, disrupts or interferes with another''s work performance or creates an intimidating, offensive or hostile environment such that each employee can realize his / her maximum potential.
Your Company has put in place a ''Policy on Prevention of Sexual Harassment'' as per The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Policy is meant to sensitize the employees about their fundamental right to have safe and healthy environment at workplace. As per the Policy, any employee may report his / her complaint to the Internal Complaint Committee formed for this purpose. The Company affirms that during the year under review adequate access was provided to any complainant who wished to register a complaint under the Policy.
During the year under review, there was no such Complaints received by the Internal Complaint Committee.
PARTICULARS OF EMPLOYEES AND OTHER RELATED INFORMATIONS
The information required to be disclosed in the Director''s Report pursuant to the provisions of Section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are set out in as an Annexure-V to this Report.
CORPORATE GOVERNANCE
Your Company is committed to maintain and adhere highest standards of Corporate Governance requirements as stipulated in SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015 . The Corporate Governance Report along with the Certificate from M/s. V. Malik & Associates, Chartered Accountants, Statutory Auditors of the Company is attached with this report.
CEO/CFO Certification
Pursuant to the provisions of Regulation 34(3) of Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) Regulation, 2015 pertaining to Corporate Governance, Mr. Dwijen Lahiri, Whole Time Director and Mr. Sandip Gupta, Chief Financial Officer of the Company have certified inter-alia, about review of financial statements for the financial year ended 31st March, 2016. The said Certificate has been provided elsewhere in the Annual Report.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
During the year under review, your Company has not transferred any sum to the Investor Education Protection Fund (IEPF) of the Central Government, as there were no unclaimed or unpaid amount of dividend due and payable at the end of the financial year 2015-16.
AWARDS AND RECOGNITION
During the year under review, your Company had participated in National Convention of Quality Circles organized by Quality Circle Forum of India, Chennai Chapter and had been recognized in Excellent Category.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report for the year under review, as stipulated under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 being presented in a separate section forming a part of this Annual Report.
APPRECIATION
Your Directors would like to express their appreciation for the assistance and co-operation received from the Financial Institutions, Banks, Government Authorities, Customers, Vendors and Members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the services rendered by the officers, staff and workers of the Company at all levels and look forward to their continued co-operation.
For and on behalf of the Board
Sd/- Sd/-
Place: Kolkata Prof. Manoj Kumar Mitra Dwijen Lahiri
Date: 11th August, 2016 Director Whole Time Director
Mar 31, 2015
Dear Members,
The Directors have pleasure in presenting the Forty Sixth Annual
Report of your Company together with the Audited Financial Statements
for the financial year ended 31st March, 2015.The summarized Audited
Financial Results for the financial year ended 31st March, 2015 are as
under.
FINANCIAL RESULTS
(Rs in Lacs)
Particulars Year ended Year ended
31st March, 2015 31st March, 2014
Sales/Income from Operations 17,015.95 17,071.26
Less: Excise Duty 1,253.94 1,525.09
Revenue from Operation 15,762.01 15,546.17
Other Income 440.19 239.96
Total Income 16,202.20 15,786.13
Total Expenditure 19,373.16 17,290.97
Profit/(Loss) before Exceptional
and Extraordinary Item & Tax (3,170.96) (1,504.84)
Add: Exceptional Items 3.88 16.21
Profit/(Loss) before Tax (3,174.84) (1,521.05)
Provision for Taxation
- Current Tax - -
- Deferred Tax (1,059.28) 17.33
Net Profit/(Loss) after
Taxation (2,115.56) (1,538.38)
During the year under review, the total Income was Rs.16,202.20 Laces as
against Rs.15,786.13 Lacs in the previous year representing increase in
total income. Net loss after providing for interest, depreciation and
tax increased to Rs.2,115.56 Laces as against net loss of Rs. 1,538.38
Laces during the previous year.
DIVIDEND
In view of the losses during the financial year 2014-15, your Directors
do not recommend any dividend for the financial year 2014-15.
TRANSFER TO RESERVES
The Company is not statutorily required to transfer any amount to the
General Reserve as no Dividend has been recommended for the financial
year 2014-15.
SHARE CAPITAL
The Paid up Share Capital as on 31st March, 2015 was Rs. 2282.44 Laces.
During the year under review, your company has allotted 83,20,000
shares to promoter and promoters group on preferential basis at Rs.
14.75 each including premium of Rs. 4.75 on 29th May, 2014 in terms of
CDR Scheme.
SUBSIDIARY COMPANY/JOINT VENTURE COMPANY/ASSOCIATE COMPANY
The Company does not have any Subsidiary Company/Joint Venture
Company/Associate Company in terms of provisions 134(3) of the
Companies Act, 2013 read with Rule 8(5)(iv) of Companies (Accounts)
Rules, 2014 and hence no disclosure is required.
PUBLIC DEPOSIT
During the year, your Company has not accepted/ received any deposit
pursuant to section 73 of Companies Act, 2013 read with Companies
(Acceptance of Deposits) Rules, 2014.
COMPANY'S PERFORMANCE
CAST ROLL DIVISION
Production during the year under review decreased to 8573 MT (Metric
Ton) as against 9824 MT during the year 2013-14. Cast Roll Sales
decreased to 8396 MT as against 10030 MT during the year
2013-14.Consequently the total revenue from the Cast Roll Division
decreased to Rs. 10695.91 Laces as compared to Rs.13,156.87 Lacs in the
previous year.
FORGE ROLL DIVISION
Production during the year under review increased to 955 MT as against
855 MT during the previous year. Forge Roll sales increased to 936 MT
as against 850 MT in the year 2013-14.Consequently, the total revenue
from the Forged roll division was Rs. 1822.86 Laces compared to
Rs.1,785.03 Laces in the previous year which reflects a marginal
increase .
EXPORT
During the year under review, the Company exported 3120 MT of Cast
Rolls as compared to 2279 MT during the previous year. Your Company is
exploring new markets for Cast Rolls in Turkey, UAE, Qatar, Nigeria,
Iran, Egypt, Bangladesh, Oman, AHMSA (Mexico) while strengthening its
presence in the existing markets.
CORPORATE DEBT RESTRUCTURING
Your Company continues to be under CDR Scheme as reported in the
previous year and is making repayments as laid down in the terms and
conditions of the Scheme.
SCHEME OF AMALGAMATION
As reported last year, your Directors have approved the Scheme of
Amalgamation of the Company with Geetapuram Port Services Limited
("GPSL or the Transferor Company No.1") and its wholly owned subsidiary
North East Natural Resources Private Limited ("NENRPL or the Transferor
Company No.2").
Pursuant to Clause 24(f) of Listing Agreement, BSE Limited and The
Calcutta Stock Exchange Limited has given their consent vide their
Observation letter dated 2nd December, 2014 and 3rd December, 2014
respectively.
Pursuant to an Order of the Hon'ble High Court of Judicature at
Calcutta, the meetings of the Equity Shareholders and 6% Cumulative
Optionally Convertible Redeemable Preference Shareholder of the Company
were held on Saturday, the 28th day of March, 2015 for the purpose of
seeking approval of the Shareholders of the Company for the said Scheme
of Amalgamation. Thereafter, the Scheme of Amalgamation was approved
by requisite majority.
Further, the Company has filed the confirmation Petition before the
Hon'ble High of Judicature at Calcutta and the same is pending for
approval at present. The amalgamation, if approved will be advantageous
and beneficial to all stakeholders of your Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
DIRECTORS
Pursuant to the provisions of Section 149 of Companies Act, 2013 which
came with effect from 1st April, 2014, Mr. Mahesh Trivedi, Prof. Manoj
Kumar Mitra, Dr. Shekhar Chaudhuri and Prof. Binay Bhushan Chakrabarti
were appointed as Non- Executive Director (Independent) at the 45th
Annual General Meeting of the Company held on 10th September, 2015.The
terms and conditions of appointment of Independent Directors are as per
Schedule IV of the Companies Act, 2013.They have submitted a
declaration that each of them meets the criteria of Independence as
provided in Section 149(6) of the Companies Act, 2013.
During the year under review, Mr.Vinod Kothari and Prof. Binay Bhushan
Chakrabarti, Non-Executive Independent Directors resigned from the
office of Director with effect from 21st April, 2014 and 7th November,
2014 respectively. The Board of Directors placed on record their
appreciation of the valuable contribution during their association with
the Company.
During the year under review, Dr. Buddhadeb Duari was appointed as an
Additional Director (Independent) of the company on 31st March, 2015
and holds office up to the date of ensuing Annual General Meeting of the
Company. The Company has received Notice along with the requisite
deposit under section 160 of the Companies Act, 2013, proposing the
candidature of Dr. Buddhadeb Duari as an Non-Executive (Independent)
Director of the Company. Your director recommend the appointment of
Dr.Buddhadeb Duari as Non-Executive (Independent) Director of the
Company. The details of the appointment are set out in the notice
convening the forty- sixth Annual General Meeting of the Company.
KEY MANAGERIAL PERSONNEL
Your Directors at their meeting held on 29th May, 2014 noted and
ratified the appointment of Mr. Susanta Ghosh, Managing Director & CEO,
Mr. Sandip Gupta, Chief Financial Officer and Ms. Shabnum Zaman,
Company Secretary of the Company as the Key Managerial Personnel of
your Company pursuant to the provisions of Section 2(51) and Section
203 of the Companies Act, 2013 read with Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014.
During the year under review, Ms. Shabnum Zaman, resigned from the
office of Company Secretary and Key Managerial Personnel of the Company
with effect from the closing hours of 8th December, 2014.The Board of
Directors placed on record their appreciation for the Services rendered
by her.
Further, during the said year your Directors at their meeting held on
12th February, 2015 has appointed Mr. Alok Kumar Samant, as Company
Secretary and Key Managerial Personnel of the Company with immediate
effect.
The details of remuneration paid to the Key Managerial Personnel
appointed by your Company in accordance with the provision of Section
203 of Companies Act, 2013 are set out in this Report.
RETIREMENT BY ROTATION
In accordance with the provisions of Section 152 of the Companies Act,
2013 and rules made thereunder and in terms of the Article of
Association of the Company, Mr. Anil Sureka (DIN: 00058228),
Non-Executive Director of the Company, shall retire by rotation at the
ensuing Annual General Meeting and being eligible, offers himself for
re-appointment as Non-Executive Director of your Company. Your Board of
Directors has recommended his re-appointment. The details of the
re-appointment are set out in the notice convening the 46th Annual
General Meeting of your Company.
BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and Revised
Clause 49 of the Listing Agreement, the Board has carried out an annual
performance evaluation of its own performance and that of its
Committees and individual Directors. A structured questionnaire was
prepared after taking into consideration of inputs received from the
Directors, covering various aspects of the Board's functioning such as
adequacy of the composition of the Board and its Committees, Board
culture, execution and performance of specific duties, obligations and
governance.
To determine the criteria of evaluation of the performance of the
Independent Directors as required under the Revised Clause 49 of the
Listing Agreement, the Nomination and Remuneration Committee at its
meeting established the criteria based on which the Board will evaluate
the performance of the Directors.
A separate exercise was carried out to evaluate the performance of
individual Directors including the Chairman of the Board, who were
evaluated on the parameters such as level of engagement and
contribution, independence of judgment. The performance evaluation of
the Independent Directors was carried out by the entire Board. The
performance evaluation of the Chairman and the Non Independent
Directors was carried out by the Independent Directors.
The Directors expressed their satisfaction over the evaluation process
and results thereof.
MEETING OF THE BOARD AND AUDIT COMMITTEE
The details of the number of Board and Audit Committee Meetings of the
Company are set out in the Corporate Governance Report which forms part
of this report. The intervening gap between the meetings was within the
period prescribed by the Companies Act, 2013 and the Listing Agreement.
MEETING OF INDEPENDENT DIRECTORS
Pursuant to the provisions of Companies Act, 2013 and Listing
Agreement, a separate meeting of the Independent Directors was held on
Tuesday, the 31st day of March, 2015. In the said meeting the Directors
have reviewed the performance of Board and its Committees, Chairman of
the Board, Non-Executive Directors and further assessed the quality,
quantity and the timeliness of flow of information between the
management and Board of the Company.
DECLARATION OF INDEPENDENCE BY THE INDEPENDENT DIRECTORS
Your Company has received declarations from all the Independent
Directors that they meet the Criteria of Independence as laid down
under the Companies Act, 2013 read with Schedule IV and Rules made
thereunder, as well as Revised Clause 49 of Listing Agreement. The
Board considered the independence of each of the Independence Directors
in terms of above provisions and is of the view that they fulfill the
criteria of independence.
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS
The Company is required to conduct the Familiarization Programmed for
Independent Directors (IDs) in terms of Clause 49(II)(B)(7) of the
Listing Agreement, to familiarize them about the Company and their
roles, rights, responsibilities in the Company, nature of the industry
in which Company operates, business model of the Company and other
related matters. The details of such Familiarization Programmed for
Directors are available on the Company's website
(URL:www.gontermann-peipers.com/
investors relations/Directors/familiarization programmer of Independent
Directors).
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to Section 134 (1)(c) of the Companies Act, 2013, your
Directors confirm that:
(i) in the preparation of the annual accounts for the financial year
31st March, 2015, the applicable accounting standards and Schedule III
to the Companies Act, 2013 have been followed and there are no material
departure from the same;
(ii) they had selected such accounting policies and applied them
consistently and made judgments and estimates that are responsible 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 your Company for
the year ended on that date ;
(iii) they 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 your Company and for
preventing and detecting fraud and other irregularities;
(iv) they have prepared the annual accounts for the year ended 31st
March, 2015 on a going Concern basis;
(v) they have laid down internal financial controls to be followed by
your company and that such internal financial control are adequate and
operating effectively;
(vi) they have devised proper system to ensure compliance with the
provisions of all applicable laws and that the systems were adequate
and operating effectively.
EXTRACT OF THE ANNUAL RETURN
An Extract of Annual Return as on the financial year ended 31st March,
2015 in Form No. MGT-9 as required Under Section 92 of the Companies
Act, 2013, read with the Companies (Management and Administration)
Rules, 2014 is set out as Annexure - I to this Report.
REMUNERATION POLICY
Pursuant to the provisions of Section 178 of the Companies Act, 2013
read with rules made thereunder and Revised Clause 49 of the Listing
Agreement, the Board of Directors have on the recommendation of
Nomination and Remuneration Committee formulated the policies for
Nomination and Remuneration of Directors, Key Managerial Personnel
('KMP') and Senior Managerial Personnel ('SMP') of your Company. The
same is annexed as Annexure- II to this Report.
STATUTORY AUDITORS
M/s. V. Malik & Associates, Chartered Accountants, having Registration
No. 000155N, issued by The Institute of Chartered Accountants of India,
the Statutory Auditors of the Company hold office till the conclusion
of the forty-eighth Annual General Meeting of the Company. The Board in
terms of Section 139 of the Companies Act, 2013 on the recommendation
of Audit Committee, has recommended for the ratification by the
Members, the appointment of M/s. V. Malik & Associates, Chartered
Accountants, Statutory Auditors from the conclusion of the ensuing
Annual General Meeting till the conclusion of forty-seventh Annual
General Meeting of the Company.
Comments /Qualification of the Auditors in their report and the notes
forming part of the Accounts are self-explanatory:- I. Capital Advances
(Note No.12) includes long outstanding advances to the tune of Rs.
1166.82 Laces (including amount represented as trade receivables) and
advances to suppliers (Note No. 16 Â Other Loans & Advances) including
long outstanding advances to the tune of Rs 630.75 Laces in respect of
which no Confirmation/ Acknowledgement/ Schedule of delivery was
available, the consequential revenue impact, if any is not
ascertainable. Accordingly, provision for advances doubtful for
recovery/ adjustment is necessary and non-creation of such provision is
contrary to the requirement of Accounting Standard-4, "Contingencies
and Events occurring after the Balance Sheet date".
II. The Company has recognized Net Deferred Tax Asset (DTA) of Rs
2820.74 Laces (including Rs 1059.28 Laces for the period) up to 31st
March, 2015 on account of unabsorbed depreciation, carried forward
business losses and disallowances under Income Tax Laws (Refer No. 11
and 45 of Independent Auditors Report ) based on the future
profitability projections made by the management .The Company has
history of recent losses and in the absence of virtual certainty
supported by convincing evidence to the fact that sufficient taxable
income will be available against which such deferred tax assets can be
realized and also non-disclosure of its nature, in our opinion, the
recognition of deferred tax asset is in contravention of Accounting
Standard-22"Accounting for Taxes on Income". Had the impact of item
stated above been considered, the loss for the year would have been Rs
4620.66 Laces (after adjusting deferred tax assets of Rs 1445.82 Lacs
recognized up to 31st March, 2014) as against the reported loss of Rs
2115.56 Laces and balance in Reserve and Surplus would have been Rs
(1522.44) Laces as against the reported Reserve and Surplus of Rs
1298.30 Laces.
Further the management representation to the above
qualifications/comments are as follows :
I. As regards advances to the tune of Rs 1166.82 Laces and advances to
Suppliers includes Rs 630.75 Laces the management is assuring that the
same will be adjusted against procurement of raw material or
realization of advances.
II. As regards Net Deferred Tax Asset (DTA) , based on future
profitability projections, management is assuring of achieving the
profitability in the forthcoming years and the Company is virtually
certain that there would be sufficient taxable income in the future
against which the Deferred Tax Asset can be accounted for or realized.
COST AUDITORS
Your Board on the recommendation of the Audit Committee, has approved
the appointment of M/s. Datta Chakraborty & Associates, having firm
registration No. 000300 issued by The Institute of Cost & Works
Accountants of India, Cost Accountants, for audit of cost records
maintained by the Company for the financial year ended 2015- 2016.In
terms of section 148 of Companies Act, 2013, read with the Companies
(Audit and Auditors) Rules, 2014 appropriate resolution seeking your
ratification of the remuneration M/s. Datta Chakraborty & Associates,
Cost Accountants, is included in the Notice convening 46th Annual
General Meeting of the Company.
SECRETARIAL AUDITORS
Pursuant to the provision of Section 204 of the Companies Act, 2013 and
The Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 the Company has appointed M/s. MKB & Associates, a firm of
Company Secretaries in practice to undertake the Secretarial Audit of
the Company. The Report of the Secretarial Audit is annexed herewith as
Annexure-III to this Report.
The following qualification was observed by the Secretarial Auditor in
their report to which the Board has shared the following explanation .
Qualification:
Prof. Binay Bhushan Chakrabarti an Independent Director, resigned from
the office of director from the closing hours of 7th November, 2014,
which was subsequently filled up belatedly by the Board of Directors of
the Company by appointing Dr. Buddhadeb Duari as an Independent
Director with effect from 31st March, 2015.
Management Response:
After resignation of Prof. Binay Bhushan Chakrabarti as Independent
Director, Management has taken great effort for getting a suitable
Candidate in his place. Subsequently, Dr. Buddhadeb Duari was appointed
as Non Executive Independent Director by the Board during the financial
year 2014-15.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY
There was no such loan given, investment made, guarantee given or
security provided by the Company to any entity pursuant to the
provisions of section 186 of the Companies Act, 2013.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All transactions entered by the Company during the financial year with
related parties were in the ordinary course of business and on arm's
length basis. During the year under review, the Company has not entered
into any contracts/arrangements/transactions with related parties which
could be considered as material in accordance with the provision of the
Listing Agreement.
Your Board of Directors, based on the recommendation of audit committee
has approved the Policy on materiality of related arty transactions and
dealing with related party transactions in accordance with the clause
49 of Listing Agreement and Companies Act, 2013. The said policy is
hosted in Company's Website: www.gontermann-peipers.com.
CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION, FOREIGN EXCHANGE
EARNING AND OUTGO.
The information on conservation of energy, technology, absorption and
foreign exchange earnings and outgo, as stipulated under Section
134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts)
Rules, 2014 is annexed herewith as Annexure-IV to this Report.
RISK MANAGEMENT
The Company has in place robust risk management framework which
identifies and evaluates business risk and opportunities. Pursuant to
the provisions of the Companies Act, 2013 and Clause 49 of Listing
Agreement, the Company has a Risk Management Committee of the Board,
which looks after the identification of risks and their mitigation
plans.
During the year under review, the Board and Management teams are
embracing the concept of Enterprise Risk Management (ERM). ERM is used
as a strategy decision making tool to refine management strategies and
risk controls. Thereafter, the management evaluated the risk on
priorities basis and their mitigation plan were formulated and
implemented on regular basis. The evaluated risk along with their
mitigation plan and their implementation are presented before the Board
on time to time basis.
COMPOSITION OF AUDIT COMMITTEE AND OTHER COMMITTEE
The Composition of Audit Committee and other Committees is provided in
the Corporate Governance Report forming part of this Report.
WHISTLE BLOWER POLICY & VIGIL MECHANISM
Your Company has formulated a codified Whistle Blower Policy
incorporating the provisions relating to Vigil Mechanism in terms of
Section 177 of the Companies Act, 2013 read with Companies (Meeting of
Board and its Powers) Rules, 2014 and Revised Clause 49 of the Listing
Agreement, in order to encourage Directors and Employees of your
Company to escalate to the level of the Audit Committee any issue of
concerns impacting and compromising with the interest of your Company
and its stakeholders in any way.
Your Company is committed to adhere to highest possible standards of
ethical, moral and legal business conduct and to open communication and
to provide necessary safeguards for protection of employees from
reprisals or victimization, for whistle blowing in good faith. The said
Policy is hosted on the Company's website: www.gontermann-peipers.com.
REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND PARTICULARS OF
EMPLOYEES.
The information required to be disclosed in the Director's Report
pursuant to the provisions of Section 197 of the Companies Act, 2013
read with Rule 5 of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, are set out in as an Annexure-V to
this Report.
PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
Your Company is committed to provide and promote a safe, healthy and
congenial atmosphere irrespective of gender, caste, creed or social
class of the employees. The Company in its endeavor to provide a safe
and healthy work environment for all its employees has developed a
policy to ensure zero tolerance towards verbal, physical, psychological
conduct of a sexual nature by any employee or stakeholder that directly
or indirectly harasses, disrupts or interferes with another's work
performance or creates an intimidating, offensive or hostile
environment such that each employee can realize his / her maximum
potential.
Your Company has put in place a 'Policy on Prevention of Sexual
Harassment' as per The Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressed) Act, 2013. The Policy is meant
to sensitize the employees about their fundamental right to have safe
and healthy environment at workplace. As per the Policy, any employee
may report his / her complaint to the Internal Complaint Committee
formed for this purpose. The Company affirms that during the year under
review adequate access was provided to any complainant who wished to
register a complaint under the Policy.
During the year under review, there was no such Complaints received by
the Internal Complaint Committee.
INTERNAL CONTROL SYSTEM
Your Company has in place adequate Internal Controls System,
commensurate with the size, scale and complexity of its operations. To
maintain its objectivity and independence, the internal audit report
were presented before the Chairman of Audit Committee of the Board.
The Internal Audit team monitors and evaluates efficacy and adequacy of
internal control system in the Company. Based on the report of internal
auditors, process owners undertake corrective action in their
respective areas and thereby strengthen the controls. Significant audit
observations and corrective actions thereon are presented to the Audit
Committee of the Board on quarterly basis.
CORPORATE GOVERNANCE
Your Company is committed to maintain and adhere highest standards of
Corporate Governance requirements as stipulated in Listing Agreement.
The Corporate Governance Report along with the Certificate from M/s. V.
Malik & Associates, Chartered Accountants confirming compliance with
the conditions of Corporate Governance is attached with this report.
CEO/CFO Certification
Pursuant to the provisions of Listing Agreement pertaining to Corporate
Governance, Mr. Dwijen Lahiri, Whole Time Director and Mr. Sandip
Gupta, Chief Financial Officer of the Company have certified
inter-alia, about review of financial statements for the financial year
ended 31st March, 2015.The said Certificate has been provided elsewhere
in the Annual Report.
CHANGE IN REGISTRAR AND SHARE TRANSFER AGENT (RTA)
During the year under review, your Directors at their meeting held on
12th February, 2015 has decided to change its existing Registrar &
Share Transfer Agent M/s. MCA Limited to M/s. MCS Share Transfer Agent
Limited having its office at 12/1/5, Manoharpukur Road, Kolkata-700026.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
During the year under review, your Company has transferred a sum of Rs.
31,368/- (Rupees thirty one thousand three hundred sixty eight Only) to
the Investor Education Protection Fund (IEPF) of the Central
Government, being the dividend amount pertaining to the financial year
ended 31st March, 2007 which was due and payable and remained unclaimed
and unpaid for period of seven (7) years, as provided in Section 205A
and 205C of Companies Act, 1956 read with Investor Education and
Protection Fund (Awareness and Protection of Investors) Rules, 2001.
AWARDS AND RECOGNITION
Your Company has participated in National Convention of Quality Circle
organized by Pune Chapter, and had been recognized in Category of
Excellent and Par Excellent Category.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report for the year under review, as
stipulated under Clause 49 of the Listing Agreement being presented in
a separate section forming a part of this Annual Report.
APPRECIATION
Your Directors would like to express their appreciation for the
assistance and co-operation received from the Financial Institutions,
Banks, Government Authorities, Customers, Vendors and Members during
the year under review. Your Directors also wish to place on record
their deep sense of appreciation for the services rendered by the
officers, staff and workers of the Company at all levels and look
forward to their continued co-operation.
For and on behalf of the Board
Place: Kolkata Prof. Manoj Kumar Mitra Dwijen Lahiri
Date: 13th
November, 2015 Director Whole Time Director
Mar 31, 2014
Dear Shareholders,
The Directors have pleasure in presenting the Forty Fifth Annual
Report of your Company together with the Audited Statement of Accounts
for the year ended 31st March, 2014.
FINANCIAL RESULTS
The summarized financial results for the year ended 31st March, 2014
are as under:
(Rs in Lacs)
Particulars Year ended Year ended
31.03.2014 31.03.2013
Sales/Income from Operations 16,964.44 13,579.89
Less: Excise Duty 1,525.09 1,174.38
15,439.35 12,405.51
Other Income 239.96 112.63
Total Income 15,679.31 12,518.14
Total Expenditure 17,184.15 15,970.68
Profit/(Loss) before Exceptional and
Extraordinary Items & Tax (1,504.84) (3,452.54)
Add: Exceptional Items 16.21 (57.54)
Add: Extraordinary items  25.63
Profit/(Loss) before Tax (1,521.05) (3,420.63)
Provision for Taxation
- Tax related to earlier years  0.41
- Deferred Tax 17.33 (1,112.21)
Net Profit/(Loss) after Taxation (1,538.38) (2,308.83)
During the year under review, the net revenue from Sales was Rs.
15,439.35 Lacs as against Rs. 12,405.51 Lacs in the previous year
representing a substantial increase in revenue. Operating profit before
interest and depreciation was Rs. 1,172.64 Lacs, as against Loss of Rs
740.60 Lacs during the previous year. Net loss after providing for
interest, depreciation and tax reduced to Rs. 1,538.38 Lacs as against
net loss of Rs. 2,308.83 Lacs during the previous year.
DIVIDEND
In view of the accumulated losses, your Directors regret to state their
inability to recommend any dividend for the year ended 31st March,
2014.
PERFORMANCE
CAST ROLL DIVISION
Production during the year under review increased to 9824 MT as against
7296 MT during 2012-13. Sales increased to 10030 MT as against 8264 MT
in the year 2012-13. Consequently, the total revenue from the Cast Roll
division increased to Rs. 13,156.87 Lacs as compared to Rs. 10061.04
Lacs in the previous year.
FORGED ROLL DIVISION
Production during the year under review decreased to 855 MT as against
945 MT during the previous year. Forged Roll sales decreased to 850 MT
against 1005 MT in the year 2012-13. Consequently, the total revenue
from the Forged roll division was Rs. 1,785.03 Lacs compared to Rs.
2,095.20 Lacs in the previous year which reflects a marginal fall.
EXPORTS
During the year under review the Company exported 2279 MT of Cast Rolls
as compared to 2247 MT during the previous year. Your Company is
exploring new markets for Cast Rolls in South American Countries,
Canada, Iran and Vietnam while strengthening its presence in the
existing markets. The initial foray into the untapped European &
African markets of Spain, Russia and Kenya respectively has been
fruitful.
The Company exported 175 MT of Forged Rolls as against 151 MT during
the previous year. Your Company has made foray into new markets like
Malaysia, Indonesia, Africa & Ethiopia, etc and is aggressively
pursuing requirements in Thailand, Brazil, Egypt, Kenya & Vietnam.
CORPORATE DEBT RESTRUCTURING
Your Company continues to be under the CDR Scheme as reported in the
previous year and is making repayments as laid down in the Scheme. Your
Company allotted 83,20,000 equity shares of Rs.10 each at a price of
Rs.14.75 each inclusive of premium of Rs. 4.75 each aggregating to
Rs.1227.20 lacs to the promoters on preferential basis in terms of CDR
Scheme.
SCHEME OF AMALGAMATION
Your Directors at their meeting held on 29th May, 2014, have considered
and approved a Scheme of Amalgamation of Geetapuram Port Services
Limited (GPSL or the Transferee Company) and its wholly owned
subsidiary North East Natural Resources Private Limited (NENRPL or the
Transferee Company) with your Company under Sections 391-394 of the
Companies Act, 1956 and other applicable provisions of the Companies
Act, 1956 as amended and the corresponding provisions of the Companies
Act, 2013 upon their notification (including any statutory
modifications(s) or re-enactment(s) thereof) (the Scheme).The Board has
approved the share swap ratio of 1:40, meaning thereby that every
shareholder of GPSL holding 1 (One) fully paid Equity Shares of Rs.10/-
each shall be entitled to receive 40 (Forty) fully paid-up Equity
Shares of Rs.10/- each in your Company. Such swap ratio is based upon
the report by an independent valuer and the fairness of the same has
been confirmed by an independent merchant banker. The Appointed Date
for the amalgamation shall be 1st April, 2013. Equity shares issued by
the Company to the shareholders of GPSL pursuant to the Scheme would be
listed on BSE Limited and The Calcutta Stock Exchange Limited.
Your Directors noted that merger of GPSL and NENPRL with your Company
will result into:
- Restructuring, expansion and diversification into new business
activities which would enable the amalgamated entity to have access to
better financial resources as well as to enable them to manage their
business more efficiently, which would result in maximizing overall
stakeholders'' value.
- Improved organizational capability and leadership, arising from the
pooling of human resources who have the diverse skills, talent and vast
experience to conduct business.
- Greater efficiency in cash management of the amalgamated entity.
- Strengthening the financials of your Company facilitating effective
implementation of the CDR Scheme. The cascading effect shall ensure
faster revival of your company .
The Scheme has been approved by the Board subject to the requisite
approval of the members of the Company as may be directed by the
Hon''ble High Court Calcutta and High Court of Judicature at Bombay and
subject to all such requisite approvals from the relevant regulatory
authorities and sanction of the High Courts.
DIRECTORS
During the year under review, Mr. Biswanath Bhattacharjee, resigned as
Director (Operations) of the Company with effect from 20th December,
2013.
The nomination of Mr. B. K. Roy was withdrawn by IFCI Limited with
effect from 25th July, 2013 and the nomination of Mr. S.S. Saswat was
withdrawn by EXIM Bank with effect from 10th January, 2014.
Mr. Rajendra Kumar Parakh and Mr. Vinod Kumar Kothari resigned as
Director of the Company with effect from 20th March, 2014 and 21st
April, 2014 respectively.
The Board of Directors placed on record their deep appreciation for the
valuable contribution made by them during their tenure as Directors of
the Company.
Mr. Susanta Ghosh was appointed as Managing Director & CEO for a period
of three years with effect from 13th November, 2013, subject to the
approval of the Members and other authorities, as may be required.
In terms of Section 149 and other applicable provisions of Companies
Act, 2013 and on the recommendation of the Remuneration Committee Prof.
Binay Bhushan Chakrabarti, being eligible was appointed as an
Independent Director for tenure of five consecutive years with effect
from 29th May, 2014, subject to the approval of the members. The
Company has received requisite notice in writing from a member
proposing Prof. Binay Bhushan Chakrabarti for appointment as
Independent Director.
Mr. Mahesh Trivedi, Prof. Manoj Kumar Mitra and Dr. Shekhar Chaudhuri,
Independent Directors, whose period of office is liable to
determination by retirement of directors by rotation under the
erstwhile applicable provisions of the Companies Act, 1956, being
eligible offer themselves for appointment in terms of Section 149 and
other applicable provisions of the Companies Act 2013, for a tenure of
five consecutive years. The Company has received requisite notices in
writing from members proposing Mr. Mahesh Trivedi, Prof. Manoj Kumar
Mitra and Dr. Shekhar Chaudhuri for appointment as Independent
Directors.
Ms. Shristi Mittal, Director of the Company retire by rotation at the
ensuing Annual General Meeting and, being eligible, offer herself for
re-appointment. The Board has recommended her re-appointment.
The Company has received declarations from all the Independent
Directors of the Company confirming that they meet with the criteria of
independence as prescribed under sub-section (6) of Section 149 of the
Companies Act, 2013 and Clause 49 of the Listing Agreement with the
Stock Exchanges.
The details concerning the appointment / re-appointment of Directors
are included in the notice convening the ensuing Annual General
Meeting.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
state that:
(i) in the preparation of the financial accounts for the year ended
31st March, 2014, the applicable accounting standards have been
followed and there have been no material departure;
(ii) they had selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the Accounting Year;
(iii) they had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) they had prepared the financial accounts for the year ended 31st
March, 2014 on a going concern basis. COST AUDITORS
Your Company had appointed M/s N. B. Bhattacharyya & Co., Cost
Accountant, as Cost Auditors, with the approval of the Central
Government, for audit of cost records maintained by the Company for the
financial year ended 31st March, 2013. The Cost Audit Report was filed
by the Cost Auditor on 7th September, 2013 within the due date of 27th
September, 2013.
In respect of the financial year ended 31st March, 2014, your Company,
with the approval of the Central Government, has appointed M/s. Datta
Chakraborty & Associates, as Cost Auditors, for audit of cost records
maintained by the Company. The due date for filing the Cost Audit
Report is 27th September, 2014.
SECRETARIAL AUDITOR
In terms of Section 204 of the Companies Act 2013, the Board of
Directors at their meeting held on 29th May, 2014, have appointed M/s.
MKB & Associates, Practicing Company Secretaries, as Secretarial
Auditor, for conducting Secretarial Audit of the Company for the
Financial Year 2014-15.
AUDITORS
The Board, on the recommendation of the Audit Committee, has proposed
that M/s. V. Malik & Associates, Chartered Accountants, having
Registration No. 000155N, be re-appointed as the Statutory Auditors of
the Company for a period of three years in accordance with Section 139
of the Companies Act 2013. Appropriate resolution seeking your approval
to the said re-appointment is appearing in the Notice convening the
45th AGM of the Company.
The Company has received letter from M/s. V. Malik & Associates
Chartered Accountants, to the effect that their re-appointment, if
made, would be within the prescribed limits under Section 141(3)(g) of
the Companies Act, 2013 and that they are not disqualified for
re-appointment.
AUDITORS'' REPORT
The Auditors, in their statement under Companies (Auditor''s Report)
Order 2003, annexed to their Report, have drawn attention to the
following:
a) The outstanding advances for capital goods includes long outstanding
advances to the tune of Rs.297.00 Lacs and advances to suppliers
includes Rs.446.61 lacs in respect of which no confirmation / schedule
of delivery was available, the consequential revenue impact, if any is
not ascertainable. Accordingly, it was felt that the creation of no
provision in respect of doubtful /advances is contrary to the
requirements of AS 4.
b) Note No. (11) Regarding recognition of Net Deferred Tax Asset (DTA)
of Rs.1445.82 lacs (including Rs (17.33) Lacs for the period)
recognized up to 31st March, 2014 based on the future profitability
projections made by the management. However, we are unable to express
any opinion on the virtual certainty of achieving these projections as
required by Accounting Standard 22 "Accounting for Taxes on Income"
and consequential impact, if any, of the recognition on such deferred
tax asset. Had the impact of item stated above been considered, the
loss for the year would have been Rs.2984.20 lacs (after adjusting
deferred tax assets of Rs.1463.15 lacs recognized upto 31st March,
2013) as against the reported loss of Rs.1538.38 lacs and balance in
Reserve and Surplus would have been Rs.1586.66 Lacs as against the
reported Reserve and Surplus of Rs.3032.48 lacs.
The Board of Directors inform that:-
a) As regard advances for capital goods includes long outstanding
advances to the tune of Rs.297.00 Lacs and advances to suppliers
includes Rs.446.61 lacs the management is confident that the same will
be adjusted against supply of materials or realisation of advances.
b) As regard Net Deferred Tax Asset (DTA), based on the future
profitability projections, management is confident of achieving the
profitability in the coming years and the Company is virtually certain
that there would be sufficient taxable income in the future against
which the Deferred Tax Asset can be accounted for. It should be noted
that during the Financial Year, the Company has reversed Deferred Tax
Assets to the extent of Rs.17.33 Lacs.
The other notes referred by the Auditors are self-explanatory and do
not require further elucidation.
FIXED DEPOSITS
During the year, your Company has not accepted any Deposits under
Section 58A and Section 58AA of the Companies Act, 1956, read with
Companies (Acceptance of Deposits) Rules, 1975.
CORPORATE GOVERNANCE
Your Company complies with the provisions laid down in Corporate
Governance laws. It believes in and practices good corporate
governance. The company maintains transparency and also enhances
corporate accountability.
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the following form part of this Annual Report:
(i) Declaration regarding compliance of Code of Conduct by Board
Members and Senior Management Personnel;
(ii) Management Discussion and Analysis;
(iii) Report on the Corporate Governance;
(iv) Auditors''s Certificate regarding compliance of conditions of
Corporate Governance.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS ANDOUTGO
In accordance with the requirements of Section 217(1)(e) of the
Companies Act, 1956, read with Companies (Disclosure of Particulars in
the Report of Board of Directors) Rules, 1988, the particulars with
respect to Conservation of Energy, Technology Absorption, Foreign
Exchange Earnings and Outgo are set out in Annexure "A" and form
part of this Report.
PARTICULARS OF EMPLOYEES
Your Company had 693 employees as on 31st March, 2014. Particulars of
the employees of the Company as required to be mentioned u/s. 217 (2A)
of the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975 and Companies (Particulars of
Employees)(Amendment) Rules 2011, are set out in Annexure "B" and
form part of this report.
Your Company has adopted the ''Policy against Sexual Harassment'' for the
employees of the Company with effect from 1st March, 2014. No incidence
of Sexual Harassment was reported during the period 1st March, 2014 to
31st March, 2014.
POTENTIALLY SICK INDUSTRIAL COMPANY
The accumulated losses of your Company have resulted in erosion of 50%
of the peak net worth during the immediately preceding four financial
years. Thus your Company has become a "Potentially Sick Company" as
laid down in Section 23 of Sick Industrial Companies (Special
Provisions) Act, 1985 (SICA). A separate report of the Directors on the
erosion of the net worth is annexed hereto as Annexure "C".
APPRECIATION
Your Directors would like to express their appreciation for the
assistance and co-operation received from the banks, government
authorities, customers, vendors and members during the year under
review. Your Directors also wish to place on record their deep sense of
appreciation for the committed services by the Company''s executives,
staffs and workers.
For and on behalf of the Board
Kolkata Prof. Manoj Kumar Mitra Susanta Ghosh
29th May, 2014 Director Managing Director & CEO
Mar 31, 2013
Dear Shareholders,
The Directors have pleasure in presenting the Forty Fourth Annual
Report of your Company together with the Audited Statement of Accounts
for the year ended 31st March, 2013.
FINANCIAL RESULTS
The summarized financial results for the year ended 31st March 2013 are
as under:
(Rs in Lacs)
Particulars Year ended Year ended
31.03.2013 31.03.2012
Sales/Income from Operations 13,579.89 13,559.95
Less: Excise Duty 1,174.38 1,124.88
12,405.51 12,435.07
Other Income 112.63 231.15
Total Income 12,518.14 12,666.22
Total Expenditure 15,970.68 15,480.44
Profit/(Loss) before Exceptional
and Extraordinary Items & Tax (3,452.54) (2,814.22)
Add: Exceptional Items (57.54) (52.19)
Add: Extraordinary items 25.63 182.77
Profit/(Loss) before Tax (3,420.63) (2,944.80)
Provision for Taxation
 Tax related to earlier years 0.41 0.53
 Deferred Tax (1,112.21) (1,000.80)
Net Profit/(Loss) after Taxation (2,308.83) (1,944.52)
During the year under review, the net revenue from Sales was Rs.
12,405.51 Lacs as against Rs. 12,435.07 Lacs in the previous year
representing a marginal fall in revenue. Operating Loss before interest
and depreciation increased to Rs. 740.60 Lacs, as against Rs 240.24
Lacs during the previous year. Net loss after providing for interest,
depreciation and tax increased to Rs. 2308.83 Lacs as against Rs.
1944.52 Lacs during the previous year mainly due to various factors
such as finance cost, rising cost of raw materials, power and fuel and
other consumables. The Management is hopeful of achieving higher level
of production during the coming financial year.
DIVIDEND
In view of the accumulated losses, your Directors regret to state their
inability to recommend any dividend for the year ended 31st March,
2013.
PERFORMANCE
CAST ROLL DIVISION
Production during the year under review decreased to 7296 MT as against
8645 MT during 2011-12. Sales decreased from 8264 MT in the last year
to 7588 MT in the year 2012-13. Consequently, the total revenue from
the Cast Roll division decreased to Rs. 10061.04 Lacs as compared to
Rs. 11137.36 Lacs in the previous year.
FORGE ROLL DIVISION
Production during the year under review increased to 945 MT as against
624 MT during the previous year. Forge Roll sales increased from 643 MT
in the last year to 1005 MT in 2012-13. Consequently, the total revenue
from the Forge roll division was Rs. 2095.20 Lacs compared to Rs.
1359.32 Lacs in the previous which reflects a growth of around of 54%.
EXPORTS
During the year under review the Company exported 2247 MT of Cast Rolls
as compared to 2348 MT during the previous year. Your Company is
exploring new markets for Cast Rolls in Venezuela, Colombia, Brazil,
Canada & other Latin American countries while strengthening its
presence in the existing markets. The initial foray into the untapped
European & African markets of Spain, Russia and Kenya respectively have
been fruitful.
The Company exported 151 MT of Forged Steel Roll as against 142 MT
during the previous year. Your Company has made foray into new markets
like Malaysia, Indonesia, Africa & Ethiopia, etc and is aggressively
pursuing requirements in Thailand, Brazil, Egypt, Kenya & Vietnam.
CORPORATE DEBT RESTRUCTURING
The working of your Company was adversely affected on account of
abnormal rise in cost of major raw materials, cost and time overrun in
the expansion cum modernization, under utilization of capacity and for
various other reasons.
As a result of this, the Company started facing liquidity crunch and it
was not able to fulfill some of its financial obligations. In order to
overcome debt repayment obligations, your Company made a reference to
the Corporate Debt Restructuring Cell ("CDR Cell") through UCO Bank for
restructuring of the debts of the Company through CDR Mechanism
envisaged under the Reserve Bank of India (RBI) guidelines dated August
23, 2001 and subsequent amendments thereto. Pursuant thereto, the CDR
-Empowered Group ("CDR - EG") approved a restructuring scheme in terms
of which the Existing Facilities were restructured in December, 2012.
The Company has executed the Master Restructuring Agreement in April,
2013 (the "MRA") with the CDR Lenders in furtherance of the CDR Scheme,
besides various other related documents as envisaged under the CDR
Scheme. Some of the salient features of the CDR Scheme are as follows:
- Cut Off Date : 1st January 2012;
- Rescheduling of Term Loan;
- Restructuring of Working Capital consisting of cash credit, packing
credit, EPC, FBN and FBP;
- Reduction in Rate of interest;
- Conversion of LC devolvement and overdrawn due to Foreign Exchange
rate difference on FCNR (B) demand Loan into Working Capital Term Loan;
- Funding of interest for the period from 1st January 2012 to 31st
December, 2013 by way of conversion to Funded Interest Term Loan;
- Carving out Additional Capex requirement;
- Fresh Term Loan for Additional Capex;
- Reduction in FD margin on non fund based limits.
Once the CDR Scheme is fully implemented and put through effectively
the operation of the company is expected to improve.
DIRECTORS
During the year under review, Mr Yadvendra Sahai, resigned as Managing
Director of the Company with effect from 19th December, 2012.
The Board of Directors accepted the resignation of Mr Yadvendra Sahai
and placed on record its appreciation for the valuable contribution
made by him during his tenure with the Company.
Mr. Susanta Ghosh was appointed as an Additional Director of the
Company by the Board of Directors at their meeting held on 11th
February, 2013 and holds office upto the ensuing Annual General
Meeting. The Company has received Notice along with requisite deposit
from a member under Section 257 of the Companies Act, 1956, proposing
the candidature of Mr. Susanta Ghosh as a Director of the Company.
Mr. Vinod Kothari, Prof Manoj Kuamar Mitra and Dr Shekhar Chaudhuri,
Directors of the Company retire by rotation at the ensuing Annual
General Meeting and, being eligible, offer themselves for
re-appointment. The Board has recommended their re-appointment.
The details concerning the appointment / re-appointment of Directors
are attached to the notice convening the ensuing Annual General
Meeting.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
state that:
(i) in the preparation of the financial accounts for the year ended
31st March, 2013, the applicable accounting standards have been
followed and there have been no material departure;
(ii) they had selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the Accounting Year;
(iii) they had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) they had prepared the financial accounts for the year ended 31st
March, 2013 on a going concern basis.
COST AUDITOR
Your Company had appointed M/s N. B. Bhattacharyya & Co., Cost
Accountant, as Cost Auditors, with the approval of the Central
Government, for audit of cost records maintained by the Company for the
financial year ended 31st March, 2012. The Cost Audit Report was filed
by the Cost Auditor on 7th February, 2013 within the due date of 28th
February, 2013.
In respect of the financial year ended 31st March, 2013, your Company,
with the approval of the Central Government, has appointed M/s N. B.
Bhattacharyya & Co., Cost Accountant, as Cost Auditors, for audit of
cost records maintained by the Company. The due date for filing the
Cost Audit Report is 30th September, 2013.
AUDITORS
The Board, on the recommendation of the Audit Committee, has proposed
that M/s. V. Malik & Associates, Chartered Accountants, New Delhi
having Firm Registration No 000155N, be re-appointed as the Statutory
Auditors of the Company, to hold office from the conclusion of the
ensuing Annual General Meeting till the conclusion of the next Annual
General Meeting of the Company. M/s. V. Malik & Associates Chartered
Accountants, New Delhi, have under section 224(1B) of the Companies
Act, 1956, furnished certificate of their eligibility for the
re-appointment.
AUDITORS'' REPORT
The Auditors, in their statement under Companies (Auditor''s Report)
Order 2003, annexed to their Report, have drawn attention to the
following:
a) The outstanding advance for capital goods includes long outstanding
advances to the tune of Rs.197.00 Lacs and advances to suppliers
includes Rs.148.92 lacs in respect of which no confirmation/ schedule
of delivery was available, the consequential revenue impact, if any is
not ascertainable.
b) Recognition of Net Deferred Tax Asset (DTA) of Rs.1463.15 Lacs
(including Rs.1112.20 Lacs for the period) in the accounts upto 31st
March 2013, based on the future profitability projections made by the
management.
c) Delay of more than six months in depositing of ESI aggregating to
Rs.2.04 Lacs. The Board of Directors inform that:- a) As regard
advance for capital goods to the tune of Rs. 197.00 Lacs and advance to
suppliers to the tune of
Rs. 148.92 Lacs the management is confident that the same will be
adjusted against supply of materials or realisation of advances.
b) As regard Net Deferred Tax Asset (DTA), based on the future
profitability projections, management is confident of achieving the
profitability in the coming years and the Company is virtually certain
that there would be sufficient taxable income in the future against
which the Deferred Tax Asset can be accounted for.
c) As regard, ESI it is informed that the amount relates to the
contractors who have not provided details relating to the contract
workers no longer working under them.
The other notes referred by the Auditors are self-explanatory and do
not require further elucidation.
FIXED DEPOSITS
During the year, your Company has not accepted any Deposits under
Section 58A and Section 58AA of the Companies Act, 1956, read with
Companies (Acceptance of Deposits) Rules, 1975.
CORPORATE GOVERNANCE
Your Company complies with the provisions laid down in Corporate
Governance laws. It believes in and practices good corporate
governance. The company maintains transparency and also enhances
corporate accountability.
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the following form part of this Annual Report:
(i) Declaration regarding compliance of Code of Conduct by Board
Members and Senior Management personnel;
(ii) Management Discussion and Analysis;
(iii) Report on the Corporate Governance;
(iv) Auditors''s Certificate regarding compliance of conditions of
Corporate Governance.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
In accordance with the requirements of Section 217(1)(e) of the
Companies Act, 1956, read with Companies (Disclosure of Particulars in
the Report of Board of Directors) Rules, 1988, the particulars with
respect to Conservation of Energy, Technology Absorption, Foreign
Exchange Earnings and Outgo are set out in Annexure "A" and form part
of this Report.
PARTICULARS OF EMPLOYEES
Your Company had 644 employees as on 31st March 2013. Particulars of
the employees of the Company as required to be mentioned u/s. 217 (2A)
of the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975 and Companies (Particulars of
Employees)(Amendment) Rules 2011, are set out in Annexure "B" and form
part of this report.
APPRECIATION
Your Directors wish to place on record their appreciation and
acknowledge with gratitude the support and co- operation extended by
the customers, vendors, bankers, financial institution, investors, and
both the Central and State Government and their Agencies and look
forward to their continued support. Your Directors also thank the
employees at all levels, for their dedication, co-operation and
continued support.
For and on behalf of the Board
Kolkata M. Trivedi B. N. Bhattacharjee
30th May, 2013 Director Director (Operations)
Mar 31, 2012
The Directors have pleasure in presenting the Forty Third Annual
Report of your Company together with the Audited Statement of Accounts
for the year ended 31st March, 2012.
FINANCIAL RESULTS
(Rs in Lacs)
Particulars Year ended Year ended
31.03.2012 31.03.2011
Sales/Income from Operations 13559.55 16907.46
Less: Excise Duty 1124.88 1,367.46
12435.07 15,540.01
Other Income 231.15 16.50
Total Income 12666.22 15,556.50
Total Expenditure 15480.44 15,411.36
Profit/(Loss) before Tax and
Exceptional Items (2814.22) 145.14
Add: Exceptional Items (52.19) (1.72)
Profit/(Loss) before Tax (2762.03) 146.86
Provision for Taxation
- Current Tax - 63.46
- Tax related to earlier years 0.53 (74.10)
- Deferred Tax Liability (1000.80) 67.01
Net Profit/(Loss) after Taxation (1944.53) 90.49
Balance brought forward 4596.92 4506.43
Surplus available for appropriation 2652.39 4596.92
Balance carried to Balance Sheet 2652.39 4596.92
During the year under review, the net revenue from Sales was
Rs.12,435.07 Lacs representing a decrease of 19.98% from Rs. 15,540.01
Lacs in the previous year. Operating Profit before interest and
depreciation amounted to Rs. 240.24 Lacs as against Rs 1914.17 Lacs
during the previous year. Net Loss after providing for interest,
depreciation and tax amounted to Rs. 1944.53 Lacs as against net profit
of Rs. 90.49 Lacs during the previous year. The decrease in
profitability was mainly due to increase in the finance cost, cost of
inputs and power and fuel.
DIVIDEND
Your Directors regret their inability to recommend any dividend for the
period ended 31st March, 2012.
PERFORMANCE CAST
ROLL DIVISION
Production during the period under review decreased to 8645 MT as
against 9781 MT during 2010-11. Cast Roll sales decreased from 9701 MT
in the last year to 8105 MT in 2011-12. Consequently the total revenue
from the Cast Roll division decreased to Rs. 11004.32 Lacs as compared
to Rs. 13217.94 Lacs in the previous year.
The sales of Special General Castings increased by 50% to 159 MT as
compared to 80 MT in the last year. The revenue from the Special
General Castings increased by 60% from Rs 52.06 Lacs in the year
2010-11 to Rs. 133.03 Lacs in 2011-12.
FORGE ROLL DIVISION
Production during the period under review decreased to 624 MT as
against 1389 MT during the previous year. Forge Roll sales decreased
from 1300 MT in the last year to 643 MT in 2011-12. Consequently the
total revenue from the Forge roll division decreased to Rs. 1359.32
Lacs compared to Rs. 3046.48 Lacs in the previous year.
EXPORTS
During the year under review the Company exported 2348 MT of Cast Rolls
as compared to 2099 MT during the previous year. The Company exported
142 MT of Forged Steel Roll as against 289 MT during the previous year.
The market expansion activities have met success in several advanced
and developing markets like US, Germany, Belgium, Spain, Malaysia,
Libya, Thailand, Taiwan, Indonesia, Kazhakstan etc. and the Company has
been able to secure repeat orders from these territories.
Improved market penetration planned in Chile, Brazil, Canada, Russia,
Ukraine and South Africa by appointing agents in different
regions/areas.
DIRECTORS
During the period under review, Mr. L K Poddar and Mr S Banerjee
resigned from the Directorship as well as services of the company with
effect from 11th November, 2011. Mr. Sushil Ray resigned from the
Directorship as well as services of the company with effect from 1st
May, 2012. Mr R K Jena resigned as Director of the Company with effect
from 11th November, 2011.
The Board of Directors accepted with regret the resignations of Mr R K
Jena, Mr. L K Poddar, Mr Sushil Ray and Mr S Banerjee and placed on
record its appreciation for the valuable contribution made by them
during their tenure with the Company.
The nomination of Mr. N D Auddy was withdrawn by IFCI Limited with
effect from 30th May, 2011. Mr. B K Roy has been nominated as Director
by IFCI Ltd. in place of Mr. N D Auddy with effect from that date. The
Board of Directors wish to place on record its appreciation for the
services rendered by Mr. N D Auddy during his tenure as Director of the
Company.
Mr. Biswanath Bhattacharjee was appointed as an Additional Director of
the Company by the Board of Directors at their meeting held on 11th
November, 2011 and holds office upto the ensuing Annual General
Meeting. The Company has received Notice along with requisite deposit
from a member under Section 257 of the Companies Act, 1956, proposing
the candidature of Mr. Biswanath Bhattacharjee as a Director of the
Company.
Mr Biswanath Bhattacharjee was also appointed as a Whole time Director
designated as Director(Operations) for a period of five years with
effect from 11th November, 2011, subject to the approval of the Members
and other authorities, as may be required.
Mr. Yadvendra Sahai was appointed as an Additional Director of the
Company by the Board of Directors at their meeting held on 11th
November, 2011 and holds office upto the ensuing Annual General
Meeting. The Company has received Notice along with requisite deposit
from a member under Section 257 of the Companies Act, 1956, proposing
the candidature of Mr. Yadvendra Sahai as a Director of the Company.
Mr. Yadvendra Sahai was also appointed as Managing Director for a
period of five years with effect from 1st December, 2011, subject to
the approval of the Members and other authorities, as may be required.
Mr. Anil Sureka, was appointed as an Additional Director of the Company
by the Board of Directors at their meeting held on 29th May, 2012, and
holds office up to the date of the ensuing Annual General Meeting. The
Company has received Notice along with requisite deposit from a member
under Section 257 of the Companies Act, 1956, proposing the candidature
of Mr Anil Sureka as a Director of the Company.
Mr. Rajendra Kumar Parakh, was appointed as an Additional Director of
the Company by the Board of Directors at their meeting held on 29th
May, 2012, and holds office up to the date of the ensuing Annual
General Meeting. The Company has received Notice along with requisite
deposit from a member under Section 257 of the Companies Act, 1956,
proposing the candidature of Mr. Rajendra Kumar Parakh as a Director of
the Company.
Mr. Pramod Kumar Mittal and Mr. Mahesh Trivedi, Directors of the
Company retire by rotation at the ensuing Annual General Meeting and,
being eligible, offer themselves for re-appointment. The Board has
recommended their re-appointment.
The details concerning the appointment / re-appointment of Directors
are attached to the notice convening the ensuing Annual General
Meeting.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
state that:
(i) in the preparation of the financial accounts for the year ended
31st March, 2012, the applicable accounting standards have been
followed and there have been no material departure;
(ii) they had selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the Accounting Year;
(iii) they had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) they had prepared the financial accounts for the year ended 31 st
March, 2012 on a going concern basis.
COST AUDITOR
Your Company had appointed M/s N. B. Bhattacharyya & Co., Cost
Accountant, as Cost Auditors, with the approval of the Central
Government, for audit of cost records maintained by the Company for the
financial year ended 31st March, 2011. The Cost Audit Report was filed
by the Cost Auditor on 27th September, 2011 within the due date of 30th
September, 2011.
In respect of the financial year ended 31st March, 2012, your Company,
with the approval of the Central Government, has appointed M/s N. B.
Bhattacharyya & Co., Cost Accountant, as Cost Auditors, for audit of
cost records maintained by the Company. The due date for filing the
Cost Audit Report is 30th September, 2012.
AUDITORS
The Board, on the recommendation of the Audit Committee, has proposed
that M/s. V. Malik & Associates, Chartered Accountants, New Delhi
having Firm Registration No 000155N, be re-appointed as the Statutory
Auditors of the Company, to hold office from the conclusion of the
ensuing Annual General Meeting till the conclusion of the next Annual
General Meeting of the Company. M/s. V. Malik & Associates, Chartered
Accountants, New Delhi, have forwarded their certificates to the
Company, stating that their re-appointment, if made, will be within the
limit specified in that behalf in sub-section (1B) of Section 224 of
the Companies Act, 1956.
AUDITORS' REPORT
The Auditors, in their statement under Companies (Auditor's Report)
Order 2003, annexed to their Report, have drawn attention to the
following:
a) Delays in few cases in depositing undisputed statutory dues
b) Certain delays in repayment of dues to domestic financial
institutions and banks during the year and the arrears of such dues as
on the Balance Sheet date
The Board of Directors inform that :-
a) Delays in few cases in depositing undisputed statutory dues have
been due to mis-matches in cash flows. The company proposes to clear
the same through internal accruals and working capital support.
b) Delays in repayment of dues to domestic financial institutions and
banks were mainly due to mis-matches in cash flows, which are
rectified, from time to time.
The other notes referred to by the Auditors are self-explanatory and do
not require further elucidation.
CORPORATE DEBT RESTRUCTURING
During the year under review, due to sluggish market conditions in
Steel Industry, your Company has not been able to repay certain loans
as per the stipulated repayment schedule in respect of
expansion-cum-modernization plan undertaken by your company. Your
Company has undertaken measures to improve the financial position of
the company by way of restructuring of bank loans and has already
applied to Corporate Debt Restructuring (CDR) cell on March 28, 2012,
for restructuring of loans. The application has been admitted by the
CDR Cell at its meeting held on May 7, 2012.
FIXED DEPOSITS
During the year, your Company has not accepted any Deposits under
Section 58A and Section 58AA of the Companies Act, 1956, read with
Companies (Acceptance of Deposits) Rules, 1975.
CORPORATE GOVERNANCE
Your company complies with the provisions laid down in Corporate
Governance laws. It believes in and practices good corporate
governance. The company maintains transparency, creates value and
wealth for its shareholders, and also enhances corporate
accountability.
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the following form part of this Annual Report:
(i) Managing Director's declaration regarding compliance of Code of
Conduct by Board Members and Senior Management personnel;
(ii) Management Discussion and Analysis;
(iii) Report on the Corporate Governance;
(iv) Auditors's Certificate regarding compliance of conditions of
Corporate Governance.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS ANDOUTGO
In accordance with the requirements of Section 217(1)(e) of the
Companies Act, 1956, read with Companies (Disclosure of Particulars in
the Report of Board of Directors) Rules, 1988, the particulars with
respect to Conservation of Energy, Technology Absorption, Foreign
Exchange Earnings and Outgo are set out in Annexure "A" and form
part of this Report.
PERSONNEL
Employee relations continued to harmonious during the year. The Board
wishes to place on record its appreciation for the efforts of all its
employees. Particulars of the employees of the Company as required to
be mentioned u/s. 217 (2A) of the Companies Act, 1956 read with the
Companies (Particulars of Employees) Rules, 1975 and Companies
(Particulars of Employees)(Amendment) Rules 2011, are set out in
Annexure "B" and form part of this report.
ACKNOWLEDGEMENTS
Your Directors wish to place on record their gratitude for the support
which the Company continues to receive from the Central Government,
Government of West Bengal as well as its business partners. Your
Directors also thank the members for their continued support.
For and on behalf of the Board
Kolkata M Trivedi Yadvendra Sahai
29th May, 2012 Director Managing Director
Mar 31, 2011
Dear Shareholders,
The Directors have pleasure in presenting the 42nd Annual Report of
the Company along with the Audited Financial Statements for the year
ended 31st March, 2011.
FINANCIAL RESULTS
(Rs. In Lacs)
Year ended Year ended
31st March, 2011 31st March, 2010
Sales/Income from
Operations 16,920.31 14,367.62
Less: Excise Duty 1,367.46 849.55
15,552.85 13,518.07
Other Income 2.67 221.16
Total Income 15,555.52 13,739.23
Total Expenditure 13,775.23 11,325.44
Profit before Interest,
Finance Charges and 1,780.29 2,413.79
Depreciation and
Exceptional Items
Interest & Finance 904.47 888.35
Charges
Depreciation 730.68 710.07
Profit/(Loss) before
Tax and Exceptional Items 145.14 815.37
Exceptional Items
Prior period items (Net) (1.72) 3.56
Profit/(Loss) before
Tax 146.86 811.81
Provision for Taxation - -
Current Tax 63.46 287.09
Tax related to earlier years (74.10) 2.75
Deferred Tax Liability 67.01 8.81
Fringe Benefit Tax - -
Net Profit/(Loss)
after Taxation 90.49 513.16
Balance brought
forward 4,506.43 4,002.53
Surplus available
for appropriation 4,596.92 4,515.69
i) Cumulative Preference à 7.91
Dividend
ii) Dividend Tax à 1.35
iii) Balance carried to
Balance Sheet 4,596.92 4,506.43
FINANCIAL PERFORMANCE
During the year under review, the net revenue from Sales was Rs
15,552.85 Lacs representing an increase of 15 % from Rs. 13,518.07 Lacs
in the previous year. Operating Profit before interest and depreciation
decreased by 26 % to Rs. 1780.29 Lacs as against Rs 2413.79 Lacs during
the previous year. Net profit after providing for interest,
depreciation and tax amounted to Rs. 90.49 Lacs as against Rs. 513.16
Lacs during the previous year. The decrease in profitability was mainly
due to increase in the cost of raw materials, power and fuel and other
consumables.
DIVIDEND
In order to maintain better liquidity position and conserve existing
resources of the Company, your Directors are constrained not to
recommend any dividend for the year under review.
OPERATIONS
CAST ROLL DIVISION
Production during the current year increased by 30% to 9781 MT as
against 7522 MT during 2009-10. Cast Roll sales increased by 24% from
7851 MT in the last year to 9701 MT in 2010-11. Consequently the total
revenue from the Cast roll division increased by 27 % at Rs. 13217.90
Lacs compared to Rs. 10424.65 Lacs in the previous year.
FORGE ROLL DIVISION
Production during the current year was 1389 MT as against 1372 MT
during the previous year. Forge Roll sales decreased by 10 % from 1448
MT in the last year to 1300 MT in 2010-11. Consequently the total
revenue from the Forge roll division decreased by 16 % to Rs. 3046.49
Lacs compared to Rs. 3616.10 Lacs in the previous year.
EXPORTS
During the year under review the Company exported 2099 MT of Cast Rolls
as compared to 1526 MT during the previous year. Your Company is
exploring new markets for Cast Rolls in Venezuela, Colombia, Brazil,
Canada, Russia, Ukraine & other Latin American countries while
strengthening its presence in the existing markets. The initial foray
into the untapped European & African markets of Spain, Russia and Kenya
respectively have been fruitful.
The Company exported 289 MT of Forged Steel Roll as against 300 MT
during the previous year. Your Company has made foray into new markets
like Malaysia, Indonesia, Africa & Ethiopia, etc and is aggressively
pursuing requirements in Thailand, Brazil, Egypt, Kenya & Vietnam.
FUTURE OUTLOOK
Rolls being integral to steel production, its demand is directly linked
to the growth of steel industry.
The Indian steel industry has been performing better than its global
peers and even the new projects are being implemented with minor
delays. With many Greenfield projects in the pipeline the demand for
steel remains bullish.
India's steel consumption rose 8 per cent in the year ended March 2011,
over the same period a year ago on account of improved demand from
sectors like automobile, infrastructure and housing. The country's
steel consumption increased to 56.3 million tonnes in the 12 months to
March 2011 from 52.3 million tonnes in the previous year.
However , in view of comparative decrease in demand in the western
world and better prospect in the Asian Market specially India & China,
all the giant roll manufacturers are focusing at Indian market and
hence the competition in roll industry has increased. This has thrown a
big challenge to Indian roll manufacturers.
Your Company expects to live up to the exacting demands of customers
and to further improve roll performance. Search is on for better
quality of inputs, which would stand up to these requirements.
EXPANSION PROJECT
The expansion-cum-modernisation project undertaken by the Company is in
the verge of completion. The Company expects to derive the full benefit
of the expansion during the current fiscal.
INITIATIVES
Your Company continues to practice various management initiatives such
as Six Sigma, Total Productive Maintenance (TPM), Total Quality
Management (TQM), Performance Management System (PMS), Activity Based
Costing Management (ABCM), Just-in-Time (JIT) etc. Your Directors are
happy to announce that these initiatives are yielding fruitful results.
During the year, your company has received the prestigious ÃTPM
Consistencyà Award from Japanese Institute of Productive Maintenance
(JIPM).
DIRECTORS
During the period under review, Mr V K Mittal and Mr R N Pandey,
resigned as Directors of the Company with effect from 30th July, 2010
and 30th May, 2011 respectively. The Board of Directors has accepted
with deep regret the resignation of Mr V K Mittal and Mr R N Pandey and
place on record its appreciation for the valuable contribution made by
them during their tenure with the Company.
Mr. Sushil Ray, was appointed as Additional Director of the Company by
the Board of Directors at their meeting held on 10th November, 2010 and
holds office upto the ensuing Annual General Meeting. The Company has
received Notice along with requisite deposit from a member under
Section 257 of the Companies Act, 1956, proposing the candidature of Mr
Sushil Ray as a Director of the Company.
Mr Sushil Ray was also appointed as a Whole time Director designated as
Director(Marketing & Technical Services) for a period of five years
with effect from 10th November, 2010, subject to the approval of the
Members and other authorities, as may be required.
Ms. Shristi Mittal, was appointed as Additional Director of the Company
by the Board of Directors at their meeting held on 30th May, 2011 and
holds office upto the date of the ensuing Annual General Meeting . The
Company has received Notice along with requisite deposit from a member
under Section 257 of the Companies Act, 1956, proposing the candidature
of Ms. Shristi Mittal as a Director of the Company.
Mr S Balasubramanian, was appointed as an Additional Director of the
Company by the Board of Directors at their meeting held on 28th July,
2010 and was appointed as a Director, liable to retire by rotation, by
the members at the Annual General Meeting held on 25th August, 2010.
Prof Manoj Kumar Mitra and Dr Shekhar Chaudhuri, Directors of the
Company retire by rotation at the ensuing Annual General Meeting and,
being eligible, offer themselves for re-appointment. The Board has
recommended their re-appointment.
The details concerning the appointment / re-appointment of Directors
are attached to the notice convening the ensuing Annual General
Meeting.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
state that: -
(i) in the preparation of the financial accounts for the year ended
31st March, 2011, the applicable accounting standards have been
followed and there have been no material departure;
(ii) they had selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the Accounting Year;
(iii) they had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) they had prepared the financial accounts for the year ended 31st
March, 2011 on a going concern basis.
COST AUDITORS
The Central Government vide its letter dated July 7, 2010 accorded its
approval to the appointment of Messrs. N. B. Bhattacharyya & Co., as
the Cost Auditors for the financial year 2010-11. The due date for
submission of the cost audit report for the financial year 2009-10 was
September 27, 2010 and the actual date of submission of the report was
August 3, 2010.
AUDITORS AND THEIR REPORT
M/s. V. Malik & Associates, Chartered Accountants, Statutory Auditors
of the company hold office till the conclusion of the ensuing Annual
General Meeting and are eligible for re-appointment. The Company has
received a letter from M/s. V. Malik & Associates to the effect that
their re-appointment as Statutory Auditors, if made, would be within
the limits under Section 224(1B) of the Companies Act, 1956. The notes
referred to by the Auditors in their Report are self-explanatory and do
not require further elucidation.
FIXED DEPOSITS
The Company has not accepted any deposits from the public, and as such
there are no outstanding deposits in terms of the Companies (Acceptance
of Deposits) Rules, 1975.
CORPORATE GOVERNANCE
Your company complies with the provisions laid down in Corporate
Governance laws. It believes in and practices good corporate
governance. The company maintains transparency, creates value and
wealth for its shareholders, and also enhances corporate
accountability.
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the following form part of this Annual Report:
(i) Managing Director's declaration regarding compliance of Code of
Conduct by Board Members and Senior Management personnel;
(ii) Management Discussion and Analysis;
(iii) Report on the Corporate Governance;
(iv) Auditors's Certificate regarding compliance of conditions of
Corporate Governance.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
In accordance with the requirements of Section 217(1)(e) of the
Companies Act, 1956, read with Companies (Disclosure of Particulars in
the Report of Board of Directors) Rules, 1988, the particulars with
respect to Conservation of Energy, Technology Absorption, Foreign
Exchange Earnings and Outgo are set out in Annexure ÃAÃ and form part
of this Report.
PERSONNEL
During the year under review, your Company continued to maintain
cordial and mutually helpful relationship with its employees. The Board
records its appreciation of the commitment and support of employees at
all levels and looks forward to their total involvement.
Particulars of the employees of the Company as required to be mentioned
u/s. 217 (2A) of the Companies Act, 1956 read with the Companies
(Particulars of Employees) Rules, 1975 and Companies (Particulars of
Employees)(Amendment) Rules 2011, are set out in Annexure ÃBÃ and form
part of this report.
APPRECIATION
Your Directors place on record their gratitude for the support which
the Company continues to receive from the Central Government,
Government of West Bengal, Financial Institutions, Banks, Business
Associates, Suppliers, Customers and Shareholders. Your Directors also
convey their warm appreciation to all employees for their diligence and
contribution to the growth of the Company.
For and on behalf of the Board
M Trivedi L K Poddar
Director Managing Director
Kolkata
30th May, 2011
Mar 31, 2010
The Directors are pleased to present their Forty-first Annual Report
of the Company along with the Audited Financial Statements for the year
ended 31st March, 2010.
FINANCIAL RESULTS
(Rs. In Lacs)
Year ended Year ended
31st March, 2010 31st March, 2009
Sales/Income from Operations 14,367.62 16,436.41
Less: Excise Duty 849.55 1326.75
13,518.07 15,109.66
Other Income 221.16 176.39
Total Income 13,739.23 15,286.05
Total Expenditure 11,325.44 13,346.08
Profit before Interest, Finance
Charges and Depreciation and Exceptional
Items 2413.79 1939.97
Interest & Finance Charges 888.35 866.09
Depreciation 710.07 637.00
Profit/(Loss) before Tax and Exceptional
Items 815.37 436.88
Exceptional Items
Prior period items (Net) 3.56 4.41
Extra Ordinary items (Net)
Profit/(Loss) before Tax 811.81 432.47
Provision for Taxation
Current Tax 287.09 130.77
Tax related to earlier years 2.75 1.41
Deferred Tax Liability 8.81 23.52
Fringe Benefit Tax - 20.23
Net Profit/(Loss) after Taxation 513.16 256.54
Balance brought forward 4002.53 3755.25
Surplus available for appropriation 4515.69 4011.79
i) Cumulative Preference Dividend 7.91 7.91
ii) Dividend Tax 1.35 1.35
iii) Balance carried to Balance Sheet 4506.43 4002.53
During the year under review, the net revenue from Sales was Rs
13,518.07 Lacs representing a decrease of 10.53% from Rs. 15,109.66
Lacs in the previous year.
Operating Profit before interest and depreciation increased by 24% to
Rs. 2413.79 Lacs , as against Rs 1939.97 Lacs during the previous year.
Net profit after providing for interest, depreciation and tax doubled
to Rs. 513.16 Lacs as against Rs. 256.54 Lacs during the previous year.
The increase in profitability was mainly due to the various cost
reduction initiatives taken by the management to tide over the
recession in the industry.
DIVIDEND
Your Directors have recommended payment of dividend on the 6%
Cumulative Optionally Convertible Redeemable Preference Shares (COCRPS)
for the financial year ended 31st March, 2010, subject to necessary
approvals. Keeping in view the present market condition your Directors
have considered it prudent not to recommend any Equity Dividend for the
year ended 31st March, 2010 and conserve resources by ploughing back
the balance profits into reserves.
OPERATIONS
The fiscal year 2009-10 began as a difficult one. There was a
significant slowdown in the growth rate in the second half of 2008-09,
following the financial crisis that began in the industrialized nations
in 2007 and spread to the real economy across the world.
World crude steel production declined by 8 per cent to 1,220 million
tonnes, Steel production weakened in nearly all the major steel
producing countries and regions including the European Union, North
America, South America and the CIS in 2009. However, Asia, in
particular China and India, and the Middle East showed positive growth
over the year.
The Indian steel industry, that went into a tailspin in the second half
of 2008-09 following a global economic downturn, recovered smartly
during the current year. The steel production rose 4.2 per cent to
reach 60 MT in 2009-2010.
CAST ROLL DIVISION
Production during the current year declined by 11.65 % to 7522 MT as
against 8514 MT during 2008-09. Cast Roll sales decreased by 7% from
8249 MT in the last year to 7851 MT in 2009-10. Consequently the total
revenue from the Cast roll division was lower by 20 % at Rs. 10425 Lacs
compared to Rs. 12958 Lacs in the previous year.
FORGE ROLL DIVISION
Production during the current year increased by 16.56% to 1372 MT as
against 1177 MT during the previous year. Forge Roll sales increased by
23% from 1174 MT in the last year to 1448 MT in 2009-10. Consequently
the total revenue from the Forge roll division also increased by 13% at
Rs. 3616 Lacs compared to Rs. 3190 Lacs in the previous year.
EXPORTS
The deepening of recession in developed economies had an adverse impact
on IndiaÃs merchandise exports which witnessed a sharp decline during
Jan-Oct 09 as global demand for IndiaÃs exports waned owing to the
financial & economic crisis.
During the year under review your Company exported 1526 MT of Cast
Rolls as against 2790 MT during the previous year, registering a
decline of 45%.
Your Company is exploring new markets for Cast Rolls in Venezuela,
Colombia, Brazil, Canada, Russia, Ukraine & other Latin American
countries while strengthening its presence in the existing markets like
Bulgaria, China, Taiwan, Indonesia, Thailand etc. The initial foray
into the untapped European & African markets of Spain, Russia and Kenya
respectively have been fruitful.
Export of Forge Rolls increased by 37% at 300 MT as against 219 MT
during the previous year inspite of the low demand. Your Company has
made foray into new markets like Malaysia, Indonesia, Africa & Ethiopia
etc and are aggressively pursuing requirements in Thailand, Brazil,
Egypt, Kenya & Vietnam.
FUTURE OUTLOOK
Global Steel demand in 2010 is forecast to grow by 9.2% to 1,206 mmt
which is a recovery to the level of 2008.
Indian steel outlook for 2010 continues to be positive, since Indian
steel consumption is expected to be rising at 6-9 per cent during the
current year on higher demand from the real estate, construction and
automobile sectors.
The per capita finished steel consumption in the country, estimated at
44 kg in 2008-09, is projected to reach 54 kg by the end of 2011-12,
showing tremendous growth potential in coming years. Despite the
slowdown, steel output rose 3.4 per cent in the first quarter of fiscal
2009-10, in comparison to the first quarter of 2008-09, while steel
consumption was also up by 5.3 per cent.
Rolls being integral to steel production, its demand is directly linked
to the growth of steel industry. The increase in steel production has
resulted in increase in the demand for rolls. With many Greenfield
/brownfield projects in the pipeline the demand for steel remains
bullish which will boost the demand for rolls.
Your Company expects to live up to the exacting demands of customers
and to improve roll performance. Search is on for better quality of
inputs, which would stand up to these requirements.
EXPANSION PROJECT
The expansion-cum-modernisation project (Phase-I) undertaken by the
Company is expected to be completed by the end of second quarter of the
current fiscal. The Company expects to derive full benefit of the
expansion during the current financial year.
Your Company expects to benefit from the domestic steel industry adding
capacity at a fast pace. The prospects for the roll industry appears to
be both promising and challenging in medium to long term. On the export
front the markets in South East Asia, China, Middle East, Africa and
Latin America are the promising ones in the current scenario.
INITIATIVES
Your Company continues to practice various management initiatives such
as Six Sigma, Total Productive Maintenance (TPM), Total Quality
Management (TQM), Performance Management System (PMS), Activity Based
Costing Management (ABCM), Just-in-Time (JIT) etc. Your Directors are
happy to announce that these initiatives are yielding fruitful results.
After receiving the TPM Excellence First Category last year, your
Company is gearing up for the Level III December 2010.
DIRECTORS
Mr Pramod Mittal, Mr V K Mittal and Mr Vinod Kothari, Directors of the
Company retire by rotation at the ensuing Annual General Meeting and
being eligible, offer themselves for re-appointment. The Board has
recommended their re-appointment.
The details concerning the appointment / re-appointment of Directors
are attached to the notice convening the ensuing Annual General
Meeting.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
state that: -
(i) in the preparation of the financial accounts for the year ended
31st March, 2010, the applicable accounting standards have been
followed and there have been no material departure;
(ii) they had selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the Accounting Year;
(iii) they had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) they had prepared the financial accounts for the year ended 31st
March, 2010 on a going concern basis.
COST AUDITORS
Pursuant to Section 233B of the Companies Act, 1956, M/s. N. P. Nigam,
Cost Accountant, is conducting audit of Cost Accounting Records of the
Company for the year ended 31st March 2010. Your Directors have
approved the appointment of M/s. N. B. Bhattacharya & Co., Cost
Accountants, to conduct audit of Cost Accounting Records of the Company
for the year ended on 31st March 2011, subject to the approval of the
Central Government.
AUDITORS & AUDITORS REPORT
M/s. V. Malik & Associates, Chartered Accountants, auditors of the
company hold office till the conclusion of the ensuing Annual General
Meeting and are eligible for reappointment. The Company has received a
letter from M/s. V. Malik & Associates to the effect that their
appointment as Auditors, if made, would be within the limits under
Section 224(1B) of the Companies Act, 1956. The notes referred to by
the Auditors in their Report are self-explanatory and do not require
further elucidation.
FIXED DEPOSITS
The Company has not accepted any deposits from the public, and as such
there are no outstanding deposits in terms of the Companies (Acceptance
of Deposits) Rules, 1975.
CORPORATE GOVERNANCE
Your company complies with the provisions laid down in Corporate
Governance laws. It believes in and practices good corporate
governance. The company maintains transparency, creates value and
wealth for its shareholders, and also enhances corporate
accountability.
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the following form part of this Annual Report:
(i) Managing DirectorÃs declaration regarding compliance of Code of
Conduct by Board Members and Senior Management personnel;
(ii) Management Discussion and Analysis;
(iii) Report on the Corporate Governance;
(iv) AuditorsÃs Certificate regarding compliance of conditions of
Corporate Governance.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
In accordance with the requirements of Section 217(1)(e) of the
Companies Act, 1956, read with Companies (Disclosure of Particulars in
the Report of Board of Directors) Rules, 1988, the particulars with
respect to Conservation of Energy, Technology Absorption, Foreign
Exchange Earnings and Outgo are set out in Annexure ÃAÃ and form part
of this Report.
PERSONNEL
During the year under review, your Company continued to maintain
cordial and mutually helpful relationship with its employees. The Board
records its appreciation of the commitment and support of employees at
all levels and looks forward to their total involvement.
Particulars of the employees of the Company as required to be mentioned
u/s. 217 (2A) of the Companies Act, 1956 read with the Companies
(Particulars of Employees) Rules, 1975 and Companies (Particulars of
Employees)(Amendment) Rules 2002, are set out in Annexure ÃBÃ and form
part of this report.
APPRECIATION
Your directors wish to place on record their appreciation for the
support which the Company continues to receive from the Central
Government, Government of West Bengal, Financial Institutions, Banks,
Business associates, Suppliers, Customers and Shareholders. Your
Directors also convey their warm appreciation to all employees for
their diligence and contribution to the growth of the Company.
For and on behalf of the Board
Kolkata M Trivedi L K Poddar
19th May, 2010 Director Managing Director
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