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

Directors Report of GTN Industries Ltd.

Mar 31, 2015

Dear Members,

The Directors are presenting the 53rd Annual Report together with the Audited Statements of Account for the year ended 31st March 2015.

FINANCIAL RESULTS

Year ended Year ended 31st March, 2015 31s1 March, 2014

INCOME

Net Sales/Income from operations* 40869 56178

Other Income 293 236

Variation in Stock (1456) 679

Total 39706 57093

EXPENDITURE

a) Cost of Materials** 27227 40777

b) Staff Cost 3126 3508

c) Power & Fuel 3792 4149

d) Other expenditure 3955 5182

Total 38100 53616

OPERATING PROFIT 1606 3477

Interest 2146 2403

Net Profit/(Loss) before Depreciation (540) 1074

and Taxation

Depreciation 872 1495

PROFIT/(LOSS) BEFORE TAX (1412) (421)

Exceptional Items (99) -

Provision for Deferred Tax (57) (376)

MAT Credit Entitlement - 152

Tax in respect of earlier years (2) (114)

PROFIT/(LOSS) AFTER TAX (1254) (83)

* Sales includes Traded goods of Rs. 9056 lacs ( Previous year Rs.21748 lacs)

**Cost of Material includes Trading purchases of Rs.8339 lacs (Previous year Rs. 20953 lacs)

DIVIDEND

In view of the Net loss incurred by the Company during the year, your Directors have not recommended any Dividend for the year.

PERFORMANCE REVIEW

During the Financial Year under review, the Company has achieved turnover of Rs.40869 lacs against Rs. 56178 lacs in the corresponding previous year. The operating and net profit before depreciation and tax were lower by Rs.1871 lacs and Rs 1614 lacs respectively, as compared to the corresponding previous year due to lower sales realisation and increase in costs.

CORPORATE DEBT RESTRUCTURING

The company had approached Corporate Debt Restructuring Cell during 2008-09. The Company has complied with all the terms stipulated by the CDR.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 134 of the Companies Act, 2013, your Directors confirm that :-

a) In the preparation of the Annual Accounts, the applicable accounting standards have been followed and there are no material departures.

b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your company at the end of the financial year and of the Loss of the Company for that year.

c) they have taken proper and sufficient care, for the maintenance of the adequate accounting records in accordance with the provisions of the Companies Act, 1956 and The Companies Act , 2013 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities.

d) they have prepared the annual accounts on a going concern basis.

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

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

CORPORATE GOVERNANCE

Your Directors affirm their commitments to the Corporate Governance Standards prescribed by the Securities and Exchange Board of India (SEBI). A report on Corporate Governance with Management Discussion and Analysis as required under Clause 49 of the Listing Agreement is attached.

HIVE OFF YARN PROCESSING & KNITTING UNITS

As approved by the Shareholders , Lenders, Statutory Authorities and CDR-EG , the envisaged scheme of Hive Off Yarn Processing and Knitting units was implemented effective from 04/09/2014 .

FIXED DEPOSITS

As per the new provisions of the Companies Act, 2013, Company is not accepting/renewing Fixed Deposits from the public / shareholders and outstanding deposits repaid before 31st March, 2015. Due to above there are no Deposits (including unclaimed) outstanding at the end of the financial year.

DIRECTORS

In accordance with the provisions of the Companies Act, 2013 and the Company's Articles of Association:

Shri B.L.Singhal Independent Director will retire by rotation at the ensuing Annual General Meeting and, being eligible, offer himself for reappointment.

Shri C.George Joseph Director will retire by rotation at the ensuing Annual General Meeting and, being eligible, offer himself for reappointment.

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section149(6) of The Companies Act, 2013 and Clause 49 of the Listing Agreement.

i) Statutory Auditors

M/s. Lodha & Company, Chartered Accountants, Mumbai, 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 letters from them to the effect that their re-appointment, if made, would be within the prescribed limits under Section 141(3)(g) of the New Companies Act, 2013 and that they are not disqualified for re-appointment.

The Notes on Financial Statements referred to in the Auditor's Report are self explanatory and do not call for any further comments.

ii) Cost Auditors

M/s. S T R Associates, Cost Accountants were appointed by the Board of Directors as Cost Auditors of your Company for the year ended 31st March, 2015. However the Cost Audit is not applicable for the year 2014-15.

For the Financial Year 2015-16 Cost Auditor proposed remuneration of Rs.2.00 lacs is recommended to the Shareholders for approval.

iii) Secretarial Audit

According to the provision of section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Secretarial Audit Report submitted by Company Secretary in Practice is enclosed as a part of this report Annexure-II

PERSONNEL & INDUSTRIAL RELATIONS

During the year, the Industrial relations were cordial and satisfactory at all units of the Company. There were no employees whose particulars are to be given in terms of Section 134 the Companies Act, 2013 read with the Companies (Particulars of Employees) Regulations.

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

The information required under Section 134 (3) (iii) of the Companies Act, 2013 read with Rule 2 of Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 2014, are set out in Annexure-I, attached hereto and forms part of this report.

VIGIL MECHANISM POLICY

In pursuance to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism Policy for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.gtnindustries.com under investors/policy documents/Vigil Mechanism Policy link.

RELATED PARTY TRANSACTIONS POLICY

In pursuance to the provisions of Section 188 of Companies Act, 2013 , company established Related Party Transaction Policy.

Related party transactions that were entered during the financial year were at an arm's length basis and were in the ordinary course of business. There were no materially significant related party transactions with the Company's Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Transactions with related parties entered by the Company in the normal course of business are periodically placed before the Audit Committee for its omnibus approval and the particulars of contracts entered during the year as per Form AOC -2 is enclosed as Annexure-III

The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act, 2013, the Rules there under and the Listing Agreement. This Policy was considered and approved by the Board has been uploaded on the website of the Company at www.gtnindustries.com under investors/ policy documents/Related Party Policy link.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9 is Annexed - IV herewith.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

RISK MANAGEMENT POLICY

The Company has been addressing various risks impacting the Company and the policy of the Company on risk management is provided elsewhere in this Annual Report in Management Discussion and Analysis.

ACKNOWLEDGEMENT

Your Directors place on record their sincere thanks to CDR- EG, Central Bank of India, State Bank of India, IDBI Bank Ltd., Export-Import Bank of India, (Exim Bank) State Bank of Travancore and Kotak Mahindra Bank Ltd., (Previously ING Vysya Bank Ltd.) the concerned Departments of the State and Central Government, Employees and Shareholders of the Company for their valuable assistance, support and co-operation to the Company.

For and on behalf of the Board

Place: Hyderabad (M.K. PATODIA ) Date : 28th May,2015 Chairman & Managing Director


Mar 31, 2014

Dear members,

The Directors are presenting the 52nd Annual Report together with the Audited Statements of Account for the year ended 31st March 2014.

FINANCIAL RESULTS

(Rs. in Lacs)

Year ended Year ended 31st March, 2014 31st March, 2013 INCOME

Net Sales/Income from operations* 56178 42226

Other Income 236 255

Variation in Stock 679 (511)

Total 57093 41970

EXPENDITURE

a) Cost of Materials** 40777 27738

b) Staff Cost 3508 3044

c) Power & Fuel 4149 4373

d) Other expenditure 5182 4561

Total 53616 39716

OPERATING PROFIT 3477 2254

Interest 2403 2137

Net Profit/(Loss) before Depreciation and Taxation 1074 117

Depreciation 1495 1517

PROFIT/(LOSS) BEFORE TAX (421) (1400)

Exceptional Items - 749

Mat Credit Entitlement 152 -

Provision for Deferred Tax (376) (462)

Tax in respect of earlier years (114) (56)

PROFIT/(LOSS) AFTER TAX (83) (1631)

* Sales includes Traded goods of Rs. 21748 lacs (Previous year Rs. 11124 lacs).

** Cost of Material includes Trading purchases of Rs. 20953 lacs (Previous year Rs.10611 lacs).

DIVIDEND

In view of the Net loss incurred by the Company during the year, to conserve available resources and considering that company is still under CDR, your Directors have not recommended any Dividend for the year.

PERFORMANCE REVIEW

During the Financial Year under review, the Company has achieved aggregate turnover of Rs.56178 lacs against Rs. 42226 lacs in the corresponding previous year. The operating and Net profit before depreciation and tax were higher by Rs.1223 lacs and Rs. 957 lacs respectively, as compared to the corresponding previous year.

CORPORATE DEBT RESTRUCTURING

The company had approached Corporate Debt Restructuring Cell during 2008-09 for the various financial assistance to strengthen the operations and CDR-EG approved the scheme effective from 31-01-2009. Second Restructuring which was approved with cut-off date from 1st July, 2012, Lenders were protected with the NPV amounts for their sacrifice. The Company has complied with all the terms of the Scheme including payment of NPV amount.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 134 (old Section 217(2AA) of 1956) the Companies Act, 2013, your Directors confirm that: -

a) In the preparation of the Annual Accounts, the applicable accounting standards have been followed and there are no material departures;

b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your company at the end of the financial year and of the Loss of the Company for that year.

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

d) they have prepared the annual accounts on a going concern basis.

e) the Directors, have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

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

CORPORATE GOVERNANCE

Your Directors affirm their commitments to the Corporate Governance Standards prescribed by the Securities and Exchange Board of India (SEBI). A report on Corporate Governance with Management Discussion and Analysis as required under Clause 49 of the Listing Agreement is attached.

HIVE OFF YARN PROCESSING / KNITTING UNITS :

As approved by the share holders, the company has initiated action to hive off these units. The company has received approvals from CDR - EG and the majority of the lenders (holding 92.5% of the total financial exposure). The approvals from two lenders and the Commissioner of Industries for the transfer of the deferred Sales Tax loan, are awaited. The Company expected to complete the transaction by Sept/Oct, 2014.

FIXED DEPOSITS

As per the new provisions of the Companies Act, 2013, Company is not accepting/renewing Fixed Deposits from the public / shareholders and outstanding deposits shall be repaid before 31st March, 2015. No Unclaimed Deposits are outstanding at the end of the financial year.

DIRECTORS

In accordance with the provisions of the Companies Act, 2013 and the Company''s Articles of Association, Shri C.George Joseph, Director retire from office by rotation and is eligible for re-appointment.

During the year Smt. Anjana Patodia has resigned as a Director and Smt. Rajul Kothari has been appointed as Independent Women Director at the Board of Director''s Meeting held on 7th August, 2014.

Mr. B. L. Singhal and Mr. M.R. Vikram were re-appointed as Independent Directors at the Board of Director''s Meeting held on 7th August, 2014.

AUDITORS

M/s. Lodha & Company, Chartered Accountants, Mumbai, 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 letters from them to the effect that their re-appointment, if made, would be within the prescribed limits under Section 141(3)(g) of the New Companies Act, 2013 and that they are not disqualified for re-appointment.

The Notes on Financial Statements referred to in the Auditors'' Report are self-explanatory and do not call for any further comments.

PERSONNEL & INDUSTRIAL RELATIONS

During the year, the Industrial relations were cordial and satisfactory at all units of the Company. There were no employees whose particulars are to be given in terms of Section 134 (old Section 217(2A) of 1956) the Companies Act, 2013 read with the Companies (Particulars of Employees)

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

The information required under Section 134 (3) (iii) of (old section 217(1)(e) of 1956) the Companies Act, 2013 read with Rule 2 of Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988, are set out in annexure- I, attached hereto and forms part of this report.

ACKNOWLEDGEMENT

Your Directors place on record their sincere thanks to CDR- EG, Central Bank of India, State Bank of India, IDBI Bank Limited, Export-Import Bank of India, (Exim Bank) ING Vysya Bank and State Bank of Travancore, the concerned Departments of the State and Central Government, Employees and Shareholders of the Company for their valuable assistance, support and cooperation to the Company.

For and on behalf of the Board

Place: Hyderabad M.K. PATODIA Date : 7th August, 2014 Chairman & Managing Director


Mar 31, 2013

To the Members,

The Directors are presenting the 51st Annual Report together with the Audited Statements of Account for the year ended 31Bl March, 2013:

FINANCIAL RESULTS

(Rs. in Lacs)

Year ended Year ended 31st March, 2013 31st March.2012

INCOME

Net Sales/Income from operations* 42226 38018

Other Income 255 186

Variation in Stock (511) (75)

Total 41970 38131

EXPENDITURE

a) Cost of Materials" 27738 26137

b) Staff Cost 3044 2764

c) Power & Fuel 4373 3098

d) Other expenditure 4561 4414

Total 39716 36413

OPERATING PROFIT 2254 1718

Interest 2137 1668

PROFIT BEFORE

DEPRECIATION AND TAXATION 117 50

Depreciation 1517 1563

PRORT/(LOSS) BEFORE TAX (1400) (1513)

Exceptional Items 749

Provision for Delerred Tax (462) (595)

Tax In respect of earlier years (56)

PROFIT/(lOSS} AFTER TAX (1631) (918)

* Sales includes Traded goods of Fts.11524 lacs (Previous year Rs. 8103 lacs) ** Cost of Material includes Trading purchases of Rs.10611 lacs {Previous year Rs.7120 lacs)

DIVIDEND

In view ol the Net loss during the year, to conserve available resources and considering that company is still under CDR, your Directors have not recommended any Dividend tor the year.

PERFORMANCE REVIEW

During the Financial Year under review, the Company has achieved turnover of Rs.42226 lacs against Rs. 38018 lacs in the corresponding previous year. The operating and cash profit were higher by Rs.536 lacs and Rs.67 lacs (before exceplional items),respectively, as compared to 1he corresponding previous year.

The profitability was mainly affected due to increase in power cost because of imposition of FSA by APCPDCL for current year as well as earlier years and purchase of high cost power from market due lo power cuts imposed in Andhra Pradesh. In addition there was increase in personnel, interest costs and provision of NPV amounts for the sacrifice made by lenders for restructuring of loans under CDR mechanism.

CORPORATE DEBT RESTRUCTURING

The Company had approached Corporate Debt Restructuring Cell during 2008-09 for the financial restructuring and CDR EG approved the scheme effective from 31" January 2009. The Company could achieve greater financial llexibiliiy in the operations in 2009-10 and 2010-1 I. However, the Company had again sought restructuring which was approved with cul-off dale Irom 1Gt July, 2012 with 18 months moratorium. Lenders were protected with the NPV amounts for their sacrifice due to restructuring. The Company has complied with all the terms of the Scheme including payment of NPV amount.

AUDITORS'' REPORT

As regards observation stated in clause (xi) of the annexure to the Auditors'' Report where in the auditors have mentioned that the Company has no! defaulted in repayment of dues to banks and financial institutions except for delays ranging between 11 to 58 days in repayment of dues of Rs. 384.71 lakhs.

In this regard, we draw the attention to note no. 26B(2) to the financial statements, which is self explanatory.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956, your Directors confirm that: -

a) In the preparation of the Annual Accounts, the applicable accounting standards have been followed and there are no materia! departures;

b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the stale of affairs of your Company at the end of the financial year and of the Loss of the Company for that year.

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

d) they have prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE

Your Directors affirm their commitments to the Corporate Governance Standards prescribed by the Securities and Exchange Board of India (SEBI). A report on Corporate Governance with Management Discussion and Analysis as required under Clause 49 of the Listing Agreement is attached,

FIXED DEPOSITS

The Company had no Unclaimed Deposits outstanding as al the close of the financial year,

DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and the Company''s Articles of Association, Slui 8.L. Singhal and Shrt M.R. Vikram, Directors retire from office by rotation and are eligible for re-appointment.

AUDITORS

M/s. Lodha & Company, Chartered Accountants, Mumbai, Auditors of the Company will retire al the forthcoming Annual General Meeting of the Company and being eligible, offer themselves for re-appointmenl.

PERSONNEL & INDUSTRIAL RELATIONS

During the year, the Induslrial relations were cordial and satisfactory, except disruption in the operation due to labour unrest at Yarn Processing Unit for 57 days during the year under review. There were no employees whose particulars are to be given in terms of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Amendement Rules, 2011.

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

The informalion required under section 217(1)(e) of the Companies Act, 1956 read wilh Rule 2 of Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988, are set out in annexure-1, attached hereto and forms part of this report.

ACKNOWLEDGEMENT

Your Directors place on record Iheir sincere thanks to CDR- EG, Central Bank of India, State Bank of India, IDBI Bank Limited, Export-Import Bank of India, (Exim Bank) ING Vysya Bank and State Bank of Travancore, the concerned Departments of (he State and Central Government, Employees and Shareholders of the Company for their valuable assistance, support and co- operation to the Company.

For and on behalf of the Board

Place : Hyderabad M.K .PATOD1A

Date :29 May, 2013 Chairman & Managing Director


Mar 31, 2012

The Directors are pleased to present the 50th Annual Report together with the Audited Statements of Account for the year ended 31st March, 2012.

FINANCIAL RESULTS

(Rs. in Lacs ) Year Ended 31st March, 2012 31aM3rch, 2011

INCOME

Net Sales/Income from operations* 38018 39912

Other Income 188 90

Variation in Stock (75) 646

Total 38131 40648

EXPENDITURE

a) Cost of Materials** 26137 25732

b) Staff Cost 2764 2487

c) Power & Fuel 3098 2654

d) Other expenditure 4414 4578

Total 36413 35451

OPERATING PROFIT 1718 5197

Interest 1668 1881 PROFIT BEFORE DEPRECIATION

AND TAXATION 50 3316

Depreciation 1563 1546

PROFIT/(LOSS) BEFORE TAX (1513) 1770

Provision for Deferred Tax (595) 803

Provision for Income Tax - 375

MAT Credit Entitlement - (359)

PROFIT/(LOSS) AFTERTAX (918) 951

* Sales includes Traded goods of Rs.8103 lacs (Previous year Rs. 12577 lacs) ** Cost of Material includes Trading purchases of Rs.7120 lacs (Previous year Rs.11165 lacs)

DIVIDEND

In view of the loss during the year, to conserve available resources and considering that company is still under CDR, your Directors have not recommended any Dividend for the year. PERFORMANCE REVIEW

During the Financial Year under review, the Company has achieved turnover at Rs.38018 lacs against Rs.39912 lacs in the corresponding previous year. The operating and cash profit were lower by Rs.3479 lacs and Rs.3266 lacs respectively, as compared to the corresponding previous year.

The low performance is mainly, due to significant increase in raw material cost without corresponding increase in sales realisations both in domestic as well as export market. In addition, there was an increase in other costs namely, power, personnel and forex fluctuations etc.,

Currently, the cotton prices are more or less stagnant with the yarn sales realisation sliding down. The real position will be known only when new cotton crop will arrive in the market in October - November, 2012.

CORPORATE DEBT RESTRUCTURING

Due to Corporate Debt Restructuring during 2009-10, the Company could achieve greater financial flexibility in the operations. Further, payments are regular as per repayment schedule. The Company has complied with all the terms of Corporate Debt Restructuring Scheme approved by lenders/ CDR -EG.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956, your Directors confirm that

a) In the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and there are no material departures;

b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company at the end of the financial year and of the Loss of the Company for that year.

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

d) they have prepared the Annual Accounts on a going concern basis.

CORPORATE GOVERNANCE

Your Directors affirm their commitments to the Corporate Governance Standards prescribed by the Securities and Exchange Board of India (SEBI). A report on Corporate Governance with Management Discussion and Analysis as required under Clause 49 of the Listing Agreement is attached.

FIXED DEPOSITS

The Company had no Unclaimed Deposits outstanding as at the close of the financial year.

DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and the Company's Articles of Association, Smt, Anjana Patodia and Shri C.George'vloseph, Directors retire from office by rotation and are eligible for re-appointment.

AUDITORS

M/s. Lodha & Company, Chartered Accountants, Mumbai, Auditors of the company will retire at the forthcoming Annual General Meeting of the Company and being eligible, offer themselves for re-appointment.

PERSONNEL & INDUSTRIAL RELATIONS

During the year, the Industrial relations were cordial and satisfactory, except disruption in the operation due to labour unrest at Yarn Processing Unit for 38 days during the year under review. There were no employees whose particulars are to be given in terms of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Amendment Rules,2011.

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

The information required under section 217(1)(e) of the Companies Act, 1956 read with Rule 2 of Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988, are set out in Annexure- I, attached hereto and forms part of this report.

ACKNOWLEDGEMENT

Your Directors place on record their sincere thanks to CDR- EG,

Central Bank of India, State Bank of India IDBI Bank Ltd, Export- Import Bank of India (Exim Bank) ING Vysya Bank and State Bank of Travancore, the concerned Departments of the State and Central Government, Employees and Shareholders of the Company for their valuable assistance, support and co-operation to the Company.

For and on behalf of the Board

Place : Hyderabad M.K PATODIA

Date : 24th May, 2012 Chairman & Managing Director


Mar 31, 2011

The Directors are presenting the 49th Annual Report together with the Audited Statements of Account for the year ended 31st March, 2011.

FINANCIAL RESULTS (Rs. in Lacs)

Year Ended Year Ended

31.03.2011 31.03.2010

INCOME

Net Sales/Income from operations* 39912 27305

Other Income 37 150

Variation in Stock 646 (830)

TOTAL 40595 26625

EXPENDITURE

a) Cost of Materials" 25732 16374

b) Staff Cost 2487 2203 c) Power & Fuel 2654 2329 d) Other expenditure 4578 3444

TOTAL 35451 24350

OPERATING PROFIT 5144 2275

Interest 1828 1434

PROFIT BEFORE

DEPRECIATION AND TAXATION 3316 841

Depreciation 1546 1569

PROFlT/(LOSS) BEFORE TAX 1770 (728)

Exceptional items (net) - 230

Provision for Deferred Tax 803 (357)

Provision for Income Tax 375 -

MAT Credit Entitlement (359) -

PROFIT/(LOSS) AFTERTAX 951 (601)

* Sales includes Traded goods of Rs. 12577 lacs (Previous year Rs.7203 lacs). ** Cost of Material includes Trading purchases of Rs. 11165 lacs (Previous year Rs. 7144 lacs)

DIVIDEND

The Companys performance for the year has improved significantly compared to the previous year. However, with a view to conserve available resources and considering that Company is still under CDR, your Directors have not recommended any Dividend for the year.

PERFORMANCE REVIEW

Your Directors are pleased to report that the performance of the Company during the year has been quite impressive as compared to the previous year.

During the Financial Year under review, the Company has achieved turnover at Rs.39912 lacs against Rs.27305 lacs in the previous year. The operating and cash profit were higher by

Rs.2869 lacs and Rs. 2475 lacs respectively, as compared to the corresponding previous year.

This exceptional performance was mainly due to increased sales realisation inspite of increased cotton prices. The domestic as well as International market has witnessed good demand. The Company could get added advantage of the cotton prices due to timely stocking of raw material at reasonable price. As a result, the cotton cost could be averaged out and margins were improved through yarn prices which remained higher in line with the then prevailing cotton prices. Further, in view of the financial restructuring package sanctioned by the lenders and CDR - EG, the Company had an advantage of interest cost reduction.

At present the cotton prices are more or less stagnant with the yarn realisation sliding down. The real position will be known when new cotton will arrive in the market during October- November, 2011.

CORPORATE DEBT RESTRUCTURING

Due to Corporate Debt Restructuring during 2009-10, the Company could achieve greater financial flexibility in the operations. The Company has complied with all the terms of Corporate Debt Restructuring Scheme approved by Lenders/ CDR -EG.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956, your Directors confirm that:

a) In the preparation of the Annual Accounts, the applicable accounting standards have been followed and there are no material departures;

b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company at the end of the financial year and of the Profit of the Company for the year;

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

d) they have prepared the Annual Accounts on a going concern basis.

DIRECTORS REPORT (contd.)

CORPORATE GOVERNANCE

Your Directors affirm their commitments to the Corporate Governance Standards prescribed by the Securities and Exchange Board of India (SEBI). A report on Corporate Governance with Management Discussion and Analysis as required under Clause 49 of the Listing Agreement is attached.

FIXED DEPOSITS

The Company had no Unclaimed Deposits outstanding as at the close of the financial year.

DIRECTORS

In accordance with the provisions of the Companies Act, 1956, and the Companys Articles of Association, Shri B.L. Singhal and Shri M.R. Vikram, Directors, retire from office by rotation and are eligible for re-appointment.

AUDITORS

M/s. Lodha & Company, Chartered Accountants, Mumbai, Auditors of the Company will retire at the forthcoming Annual General Meeting of the Company and being eligible, offer themselves for re-appointment.

PERSONNEL & INDUSTRIAL RELATIONS

During the year, the Industrial relations were cordial at all units of the Company. There were no employees whose particulars

are to be given in terms of Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Amendment Rules, 2011.

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

The information required under section 217(1)(e) of the Companies Act, 1956 read with Rule 2 of Companies (Disclosure of particulars in the report of Board of Directors) Rules, 1988, are set out in annexure-1, attached hereto and forms part of this report.

ACKNOWLEDGEMENT

Your Directors place on record their sincere thanks to CDR- EG, Central Bank of India, State Bank of India, IDBI Bank Limited, Export-Import Bank of India, ING Vysya Bank and State Bank of Travancore, the concerned Departments of the State and Central Government, Employees and Shareholders of the Company for their valuable assistance, support and co-operation to the Company.

For and on behalf of the Board

M.K.PATODIA

Chairman & Managing Director

Place : Hyderabad Date : 26,th May, 2011


Mar 31, 2010

1. Members desiring any information on the Financial Statements at the Annual General Meeting are requested to write to the Company at least seven days in advance so as to enable the Company to keep the information ready.

2. As a measure of economy, copies of Annual Report will not be distributed at the meeting. Members are requested to bring their copy of the Annual Report to the meeting.

3 All communications relating to shares are to be addressed to the Companys Share Transfer Agents M/s Integrated Enterprises (India) Ltd.

4. Members are requested to note that the Companys Equity Shares are compulsorily traded in Demat form for all investors. Members are requested to open depository account in their names with a depository participant to dematerialise their holdings. This would be necessary for facilitating the transfer of Companys Shares in all stock exchanges connected to the depository system.

To The Members,

Your Directors are presenting the 48* Annual Report together with the Audited Statements of Account for the year ended 31 * March, 2010.

FINANCIAL RESULTS (Rs. in Lacs>

Year Ended Year Ended 31.03.2010 31.03.2009

INCOME

Net Sales/Income from operations* 27305 20248

Other Income 150 (109)

Variation in Stock (830) 1385

TOTAL 26625 21524 EXPENDITURE

a) Cost of Materials" 16374 13845

b) Staff Cost 2203 2046

c) Power& Fuel 2329 2146

d) Other expenditure 3444 3392

TOTAL 24350 21429

OPERATING PROFIT 227S 95

Interest 1434 1529 PROFIT/(LOSS) BEFORE

DEPRECIATION ANDTAX 841 (1434)

Depreciation 1569 1537

LOSSBEFORETAX (728) (2971)

Exceptional items (net) 230 (224)

Provision for Deferred Tax (357) (884)

Provision for Fringe Benefit Tax - 13

LOSS AFTERTAX (601) (1876)

Sales includes Traded goods of Rs.7203 lacs (Previous year Rs. 5826 lacs). "Cost of Material includes Trading purchases of Rs 7144 lacs (Previous year Rs. 5416 lacs)

DIVIDEND

In view of the Loss, your Directors have not recommended any Dividend for the year.

PERFORMANCE REVIEW

During the Financial Year under review, the Company has achieved turnover of Rs.27305 lacs against Rs.20248 lacs in the corresponding previous year. The operating profit was higher by Rs.2180 lacs, however, the Company has incurred net loss before Tax (credit) and debit of exceptional items, of Rs. 728 lacs as against loss of Rs.2971 lacs in the corresponding previous year.

First three quarters of the financial year under review, continued to be affected by continuing global economic down trend emanated from US and European countries. However, from the last quarter of the year, the demand for Textile products in both domestic and export market is showing revival trend. This could result in higher sales realisation, favourable exchange rate and liquidation of finished goods inventories. Though the raw material prices have been going up significantly, but due to improved market demand, the increased

cost of the raw material could be passed oh to the customers. This trend is likely to continue during trie current financial year. However, the cause of concern is continuing lower demand for processed yam and realisation there from which have been under pressure. This is affecting the financials of the Yarn Processing Unit.

In current financial year 2010-11, it is expected that there would be further increase in demand for grey yam from both the markets. The realisations are also expected to improve due to strengthening of dollar against rupee inspite of withdraw! of Government Incentives viz., DEPB, Draw Back on cotton yarn export and Interest subvention. The Company is hopeful to achieve better performance in the current year.

CORPORATE DEBT RESTRUCTURING

The Company has been sanctioned Debt Restructuring Scheme by CDR - EG vide their letter dated 30-06-2009 with a cut off date 31-01-2009. The Scheme, inter-alia, provides for interest rate reduction, lower working capital margins, re-schedulementofterm loans, funding of Rs.2150 lacs by way of term loan for Capex, WCTL and Corporate loan. The promoters have also brought in Rs.750 lacs by subscribing to 60 lacs Equity Shares of Rs.10/- each with a premium of Rs:2.50 per share, after obtaining necessary approvals from the Shareholders and SEBI.

Due to this restructuring, the Company could bridge the gap in the Cash Row and achieved greater financial flexibility in the operations which could be achieved with the timely support from CDR - EG and the lenders to the Company.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956, your Directors confirm that:

a) In the preparation of the Annual Accounts, the applicable accounting standards have been followed and there are no material departures;

b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your company at the end of the financial year and of the Loss of the company for the year;

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

d) they have prepared the Annual Accounts on a Going Concern basis.

CORPORATE GOVERNANCE

Your Directors affirm their commitments to the Corporate Governance Standards prescribed by the Securities and Exchange Board of India (SEBI). A report on Corporate Governance with Management Discussion and Analysis as required under Clause 49 of the Listing Agreement, is attached.

FIXED DEPOSITS

The Company had no Unclaimed Deposit outstanding as at the close of the financial year.

DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and the Companys Articles of Association, SmtAnjana Patodia, Director, retire from office by rotation and is eligible for re-appointment.

Shri. C.George Joseph was appointed as an additional Director on the Board at its meeting held on 28th January, 2010 and is retiring at the ensuing Annual General Meeting of the Company. He is eligible for re-appointment.

AUDITORS

M/s. Lodha & Company, Chartered Accountants, Mumbai, Auditors of the Company will retire at the forth coming Annual General Meeting of the Company and being eligible, offer themselves for re- appointment.

PERSONNEL & INDUSTRIAL RELATIONS

During the year, the industrial relations were cordial at all units of the Company. A statement showing the particulars of Employees referred to in sub-section (2A) of Section 217 of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules,

1975 given in Annexure-1, attached hereto and forms part of this report.

CONSERVATION OF ENERGYJECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO.

The information required under Section 217(1 )(e) of the Companies Act, 1956 read with Rule 2 of Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988, are set out in Annexure- II, attached hereto and forms part of this report.

ACKNOWLEDGEMENT

Your Directors place on record their sincere thanks to CDR - EG, Central Bank of lndia,State Bank of India, IDBI Bank Limited, Export- Import Bank of India, ING Vysya Bank Ltd and State Bank of Travancore, the concerned Departments of the State and Central Government, Employees and Shareholders of the Company for their valuable assistance, support and co-operation to the Company.

For and on behalf of the Board

Place : Hyderabad M.K.PATODIA

Date : 28th May, 2010 Chairman & Managing Director

 
Subscribe now to get personal finance updates in your inbox!