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Notes to Accounts of KCP Ltd.

Mar 31, 2014

1. GENERAL

The fi nancial statements of the company have been prepared in accordance with generally accepted accounting principles in India ( Indian GAAP). The company has prepared these fi nancial statements to comply in all material respects with the accounting standards notifi ed under the Companies (Accounting Standards) Rules, 2006, and the relevant provisions of the Companies Act, 1956.

2. a ) Term loans from banks for Cement plant at Muktyala are Secured by Paripassu First Charge on the Fixed Assets, paripassu Second charge on the current assets and charge on the leasehold rights of the leased Lands of the Muktyala Cement Division. The rate of interest of the abovesaid loan ranges between Base Rate plus margin 2%to 3%

b) The long Terms loans obtained for Cement Plant at Muktyala are repayable in 28 Quarterly Installments of Rs. 7.26 crores each with effect from 30th June 2011.

2.1 a) Term loan obtained for Hotel project at Hyderabad is secured by First charge on the land, building and other assets of the company at Somajiguda Hyderabad. The rate of interest of the abovesaid loan is Base Rate plus margin 2%.

b) The long term loan obtained for Hotel project is repayable in 28 quarterely instalments of Rs. 1.61 crores with last instalment being Rs. 1.53 crores with holiday period of 39 months which includes construction period of 15 months and 24 months of gestation period.

c) Additional Term loan of Rs.14.73 crores obtained for Hotel Project is repayable in 28 quarterly instalments of Rs.0.53 crores after holiday period of 18 months. First instalment of both the loans for Hotel Project falls due in June 2015.

2.2 a) Term Loan obtained for the Captive Power Plant Muktyala is secured by the First Charge on the fi xed Assets of the Captive Power Plant Muktyala. The rate of interest of the abovesaid loan is Base Rate plus margin 1.75%

b) The long Term loans obtained Captive Power Plant Muktyala are repayable in 32 Quarterly Instalments of Rs 2.49 crores with the last instalment being Rs 2.45 crores each with an initial moratorium peroid of two years from the date of fi rst disbursement. First instalment falls due on March''2015.

2.3 a) Term Loan obtained for the Cement Plant Macherla is secured by the First Charge on the fi xed Assets (both present and proposed out of the loan) and second charge on the current assets of the Cement Division at Macherla. The rate of interest of the abovesaid loan is Base Rate plus margin 2%.

b) The long Term loans obtained for Cement Plant at Macherla are repayable in 28 Quarterly Installments of Rs 0.75 crores each with an initial moratorium peroid of two years from the date of fi rst disbursement. First instalment falls due in December 2014.

2.4 a) Term Loan of Rs.12 crores obtained for working capital and business operations is secured by Equitable Mortgage on properties at Visakhapatnam, Mumbai and Hyderabad. The rate of interest of this loan is Base Rate plus margin 2%.

b) This loan is repayable in 4 equal half yearly instalments of Rs. 3 crores after 1 year moratorium.

2.5 a) Term Loan of Rs.56 crores obtained for shoring up working capital is secured by Exclusive charge on land near Chennai. The rate of interest of the abovesaid loan is Base Rate plus margin 2%.

b) This loan is repayable in 20 quarterly instalments of Rs. 2.80 crores after 2 years moratorium.

3) Fixed Assets: Lands include Rs. 4,62,475/- being the value of land measuring 14.23 acres of Magazine land at Macherla assigned and notifi ed in Revenue records vide Dist. Collector, Guntur order No. RC No. 3567/2000-E 1, dated 23-10-2002 in favour of company.

4) JOINT VENTURE DISCLOSURE

The company has a 40% interest in its joint venture entity Fives Cail KCP Limited a company incorporated in India.

The Company''s share (at 40%) of the contingent liabilities of Fives Cail KCP Limited at the Balance Sheet date works out to Rs. 11,54,272/-(Rs.29,32,993)

The Company''s share (at 40%) of the capital commitments of Fives Cail KCP limited at the Balance sheet date works out to Rs. Nil (Rs.Nil).

The interest of the company (at 40%) in the aggregate amount of the assets, income and expenses of Fives KCP Limited was as follows:

5) Discontinued Operations

The Company has entered into an agreement for sale of the fi xed assets of its Bio-Tech Division. Accordingly, the operations of that Unit were discontinued with effect from 31st March, 2014. Consequently, the WDV of the assets was transferred to Inventories under the head "Assets held for Sale". The loss incurred by this Unit during the fi nancial year 2013-14 was Rs. 1,31,89,541 (2012-13 : Rs.1,31,53,331).

6) PARTICULARS DISCLOSED PURSUANT TO "AS-18 RELATED PARTY DISCLOSURES"

A). List of Related parties

Subsidiary Company KCP Vietnam Industries Limited

Joint Venture Company Fives Cail KCP Limited

Key Management Personnel (KMP)

Dr. V.L. Dutt - Chairman and Managing Director Smt. V.L. Indira Dutt - Joint Managing Director Smt. Kavitha D Chitturi - Executive Director Sri. V. Gandhi - Technical Director

Relatives of Key Management Personnel

Dr. V.L. Dutt -

Smt. Rajeswary Ramakrishanan - Sister

Smt. V.L. Indira Dutt -

Smt. S.R.V. Rajyalakshmamma - Mother Sri. V. Chandra Kumar - Brother Smt. Uma S Vallabhaneni - Sister Smt.V. Rama Kumari - Sister

Smt. Kavitha D Chitturi -

Kum.Shivani Dutt Chitturi - Daughter Sri. Ravi Chitturi - Husband

Sri. V.Gandhi -

Smt. V. Kamala Devi - Wife

Sri. V. Praveen Kumar - Son

Smt. V. Swapna - Son''s wife

Master Nishant Sai - Son''s son

Smt. V. Anupama - Daughter

Sri. N. Seshubabu - Daughter''s Husband

Companies/Trusts controlled by Key Management Personnel/Relatives

KCP Technologies Limited

V. Ramakrishna Sons Private Limited

The Jeypore Sugar Company Ltd.

VRK Grandsons Investment (P) Limited V. Ramakrishna Charitable Trust

A Trust in the name of Bala Tripurasundari Ammavaru

7) * Paise have been rounded off.

* Figures in brackets indicate those for the previous year.

* Figures for the previous year have been regrouped, wherever necessary.


Mar 31, 2013

1. GENERAL

The fi nancial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these fi nan- cial statements to comply in all material respects with the accounting standards notifi ed under the Companies (Accounting Standards) Rules, 2006, and the relevant provisions of the Companies Act, 1956.

2.1) a) Term loan obtained for Hotel project at Hyderabad is secured by First charge on the Land, Building and other Assets of the Company located at Somajiguda Hyderabad. The rate of interest of the abovesaid loan is Base Rate plus margin 2%.

b) The long term loan obtained for Hotel project is repayable in 28 quarterely instalments of Rs. 1,61,00,000/- with last instalment being Rs. 1,53,00,000/-, with holiday period of 39 months which includes construction period of 15 months and 24 months of gestation period. First instalment falls due in March, 2015.

2.2) a) Term Loan obtained for the Captive Power Plant, Muktyala is secured by the First Charge on the fixed Assets of the Captive Power Plant, Muktyala. The rate of interest of the abovesaid loan is Base Rate plus margin 1.75%.

b) The long Terms loan obtained Captive Power Plant, Muktyala is repayable in 32 Quarterly Instalments of Rs 2,49,00,000 with the last instalment being Rs 2,45,00,000 each with an initial moratorium peroid of two years from the date of fi rst disbursement.First instalment falls due on January, 2015.

2.3) a) Term Loan obtained for the Cement Plant, Macherla is Secured by the First Charge on the Fixed

Assets (both present and proposed out of the loan) and second charge on the Current Assets of the Cement Division at Macherla The rate of interest of the abovesaid loan is Base Rate plus margin 2%.

b) The long Terms loans obtained for Cement Plant at Macherla are repayable in 28 Quarterly Installments of Rs 75,00,000 each with an initial moratorium peroid of two years from the date of fi rst disbursement.First instalment falls due in December 2014.

2.4) Details of deposits held by Directors of the company

a) Dr. V. L. Dutt 33,50,000

b) Smt. Kavitha D. Chitturi 1,53,000

The rate of interest is within the limits specifi ed under Section 58 A of the Companies Act, 1956 and Rules made thereunder.

3) Fixed Assets: Lands include Rs. 4,62,475/- being the value of land measuring 14.23 Acres of Magazine land at Macherla assigned and notifi ed in Revenue records vide Dist. Collector, Guntur order No. RC No. 3567/2000-E 1, dated 23-10-2002 in favour of Company.

4) JOINT VENTURE DISCLOSURE

The company has 40% interest in its joint venture entity Fives Cail KCP Limited a company incorporated in India.

The Company''s share (at 40%) of the contingent liabilities of Fives Cail KCP Limited at the Balance Sheet date works out to Rs. NIL/-(Rs.29,32,993)

The Company''s share (at 40%) of the capital commitments of Fives Cail KCP Limited at the Balance sheet date works out to Rs. Nil (Rs. Nil).

The interest of the company (at 40%) in the aggregate amount of the Assets, Income and Expenses of Fives Cail KCP Limited was as follows:

5) PARTICULARS DISCLOSED PURSUANT TO "AS-18 RELATED PARTY DISCLOSURES"

A). List of Related parties

Subsidiary Company KCP Vietnam Industries Limited

Joint Venture Company Fives Cail KCP Limited

Key Management Personnel (KMP) Dr. V.L. Dutt - Chairman and Managing Director

Smt. V.L. Indira Dutt - Joint Managing Director Smt. Kavitha D Chitturi - Executive Director Sri. V. Gandhi - Technical Director

Relatives of Key Management Personnel Dr. V.L. Dutt -

Smt. Rajeswary Ramakrishanan - Sister

Smt. V.L. Indira Dutt -

Smt. S.R.V. Rajyalakshmamma - Mother Sri. V. Chandra Kumar - Brother Smt. Uma S Vallabhaneni - Sister Smt.V. Rama Kumari - Sister

Smt. Kavitha D Chitturi -

Kum.Shivani Dutt Chitturi - Daughter Sri. Ravi Chitturi - Husband

Sri. V.Gandhi -

Smt. V. Kamala Devi - Wife

Sri. V. Praveen Kumar - Son

Smt. V. Swapna - Son''s wife

Master Nishant Sai - Son''s son

Smt. V. Anupama - Daughter

Sri. N. Seshubabu - Daughter''s Husband

Companies/Trusts controlled by Key Management Personnel/Relatives

KCP Technologies Limited

V. Ramakrishna Sons Private Limited

The Jeypore Sugar Company Ltd.

VRK Grandsons Investment (P) Limited V. Ramakrishna Charitable Trust

A Trust in the name of Bala Tripurasundari Ammavaru

6) DERIVATIVE INSTRUMENTS FOR HEDGING PURPOSE

The Company has entered into the following Derivative instruments for Hedging purpose associated with foreign currency fl uctuations related to certain fi rm commitments and is not intended for trading or speculation.The period end foreign exchange exposures that have been hedged by a derivative instruments are stated below.

7) The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 and 3 dated 8th February 2011 and 21st February 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act 1956, subject to fulfi llment of conditions stipulated in the circular. The Company has satisfi ed the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

General:

* Paise have been rounded off.

* Figures in brackets indicate those for the previous year.

* Figures for the previous year have been regrouped, wherever necessary.


Mar 31, 2012

1 . GENERAL

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India ( Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, and the relevant provisions of the Companies Act, 1956.

2.1) Details of shareholders holding more than 5% share in the company: 1. M/s. V. Ramakrishna Sons Pvt Ltd - 3,87,70,000 (3,87,44,950) equity shares of Re. 1/- each fully paid - 30.07%(30.03%); 2. M/s. V.R.K. Grandsons Investments Pvt Ltd - 95,78,330(95,78,330) equity shares of Re. 1/- each fully paid- 7.43% (7.43%). 3. M/s. Tata Capital Ltd. - 2,00,00,000(2,00,00,000) Preference shares of Rs. 10/- each fully paid - 100%(100%).

2.2) The Opening and closing balance of the Subscribed and Paid-up equity shares of the company are same, hence, the reconciliation between opening number and closing number of shares does not arise.

3.4) a ) Term loans from banks for Cement plant at Muktyala are Secured by Paripassu First Charge on the Fixed Assets, paripassu Second charge on the current assets and charge on the leasehold rights of the leased Lands of the Muktyala Cement Division.

b) Foreign Currency Loan-Buyers Credit from a bank is Secured by paripassu First charge along with other Lenders on the existing and Proposed Assets of the existing and proposed Assets of the Engineering division at Tiruvottiyur Chennai and Cement Division at Muktyala.

c ) The long Terms loans obtained for Cement Plant at Muktyala are repayable in 28 Quarterly Installments of Rs. 7,26,00,000/- each with effect from 30th June 2011.

3.5) a) Term loan obtained for Hotel project at Hyderabad is secured by First charge on the land, building and other assets of the company at Somajiguda, Hyderabad.

b) The long term loan obtained for Hotel project is repayable in 28 quarterly installments of Rs.1,61,00,000/- with last installment being Rs. 1,53,00,000/-, with holiday period of 39 months which includes construction period of 15 months and 24 months of gestation period. First installment falls due in March 2015.

4) CONTINGENT LIABILITIES

PARTICULARS As at As at 31st March,2012 31st March,2011 Rs Rs A.Claims against the Company / disputed liabilities not acknowledged

a) In respect of Statutory levies 5,90,50,710 3,56,39,801

b) In respect of Contractual levies Nil Nil

c) In respect of others 15,16,73,133 11,94,56,352

B. Guarantees

a) Guarantees to Banks and Financial Institutions against 11 02 91 81 14,92,02,033 credit facilities extended to third parties

b) Performance Bank Guarantees 4,35,23,666 9,97,57,639

5) The Income Tax assessments of the Company have been completed up to Assessment Year 2009-10. The disputed demand outstanding up to the said Assessment year is Rs.1,11,72,135/-. Based on the decision of the Appellate authorities and the interpretations of other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

6) No provision has been made in accounts towards probable liability up to Jute year ended 30th June 1998, if any, that may arise as a result of non-compliance with the requirements of Jute Packaging materials (Compulsory Use of Packaging Commodities) Act, 1987, consequent to differring decisions of different courts and also the representations of Industry before the Government, since the same is not ascertainable at this stage.

7) Fixed Assets: Lands include Rs. 4,62,475/- being the value of land measuring 14.23 acres of Magazine land at Macherla assigned and notified in Revenue records vide Dist. Collector, Guntur Order No. RC No. 3567/2000-E 1, dated 23-10-2002 in favour of the Company.

8) JOINT VENTURE DISCLOSURE

The company has a 40% interest in its joint venture entity Fives Cail KCP Limited a company incorporated in India.

The Company's share (at 40%) of the contingent liabilities of Fives Cail KCP Limited at the Balance Sheet date works out to Rs.29,32,993/-(Rs.29,32,993)

The Company's share (at 40%) of the capital commitments of Fives Cail KCP limited at the Balance sheet date works out to Rs. Nil (Rs.Nil).

The interest of the company (at 40%) in the aggregate amount of the assets, income and expenses of Fives KCP Limited was as follows:

9) The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 & 3 dated 8th February 2011 and 21st Frebruary 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act 1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

General:

- Paise have been rounded off.

- Figures in brackets indicate those for the previous year.

- Figures for the previous year have been regrouped, wherever necessary.


Mar 31, 2011

1. No provision has been made in accounts towards probable liability upto Jute year ended 30th June, 1998, if any, that may arise as a result of non-compliance with the requirements of Jute Packaging Materials (Compulsory Use of Packaging Commodities) Act,1987, consequent to differring decisions of different courts and also the representations of industry before the Government, since the same is not ascertainable at this stage.

2. Fixed Assets : Lands includes Rs. 4,62,475/- being the value of Land measuring 14.23 Acres of Magazine Land at Macherla assigned and notifi ed in Revenue records vide Dist. Collector, Guntur order No. Rc No. 3567/2000-E1, dt. 23.10.2002 in favour of company.

3. Cash and Bank balances include

a). Rs.1,50,000/- (Rs.1,50,000/-) on account of Staff Security Deposit.

b). Rs.1,33,43,083 /- (Rs.1,14,36,780/-) towards Unclaimed Dividends.

c). Rs.6,09,88,031 /- (Rs.9,40,02,895/-) representing Fixed Deposit Receipts lodged with Bankers as securities against Guarantees issued by them.

d). Rs.5,46,00,000/- (Rs.2,30,06,320/-) deposited as per provisions of 58A of the Companies Act 1956 and the Rules made there under.

Note: (a) Sale of Products includes:

(1) Machinery and components valued at Rs.8,42,00,750/- (Rs.9,14,97,995/- ) supplied by Engineering Unit to the other units of the Company.

(2) Cement Quantity 7,537MT (22,015 MT) valued at Rs.1,65,94,191/- (Rs.4,19,42,013/-) used internally.

(3) Excise Duty Rs.45,42,60,466 /-(Rs.39,63,63,125/-) and Service Tax Rs.14,93,502 /- (Rs.16,38,348/-).

(4) Electrical energy 14,61,060KWH (14,86,032 KWH) valued at Rs. 52,14,369/- (Rs.47,56,219/-) adjusted towards wheeling and banking charges, by the buyer Electricity Company.

(b) Sale of products does not include:

(i) Elecrical Energy generated by Hydel unit 3,14,53,799 KWH (3,54,74,979 KWH) valued at Rs. 9,25,53,714/- (Rs.9,61,11,615/-), Wind Power Unit situated at Thirunelveli (Uthumalai village), 74,96,557 KWH [81,17,120 KWH) valued at Rs.3,13,75,931 /- [Rs. 3,07,52,081/-] and Power generated from Waste Heat Recovery Plant 1,60,03,400 KWH[1,32,89,600 KWH] valued at Rs4,60,55,413/- [Rs. 3,58,81,920/-] used internally.

(ii) 28,507 tons of clinker valued at Rs. 5,64,54,217/- produced at Muktyala Cement Plant and consumed at Macherla Cement Plant internally.

Note: (1) Commission provided to the Managing Director and Joint Managing Director represents the balance amount of aggregate remuneration payable to them not exceeding 2.5% each, on the Profits computed above, in accordance with the terms of their appointments. Commission provided to the Executive Director and Technical Director represents the balance amount of aggregate remunertion payable to them not exceeding 1% each upto 24th January 2011 and from thereon at the rate of 1.5% each, on the Profits computed above, in accordance with the terms of their appointments.

(2) The cost to the company of the non-monetary perquisites allowed during the year to the Whole Time Directors in addition to the remuneration paid above works out to Rs. 70,519/-. The value of the said perquisite computed in accordance with Income Tax Rules 1962 ,works out to Rs.7,89,502 /-.

4 . a). The Company has a 40% interest in its joint venture entity Fives Cail KCP Ltd a company incorporated in India.

b). The Companys share (at 40%) of the contingent liablities of Fives Cail KCP Ltd at the Balance Sheet date works out to Rs. 29,32,993/- (Rs.94,54,117/-)

c). The Companys share (at 40%) of the capital commitments of Fives Cail KCP Ltd at the Balance Sheet date works out to Rs. Nil/- (Rs.9,20,072/-)

d). The Interest of the Company (at 40%) in the aggregate amount of the assets, income and expenses of Fives Cail KCP Ltd was as follows:

5. Paise have been rounded off.

Figures in brackets indicate those for the previous year. Figures for the previous year have been regrouped, wherever necessary.


Mar 31, 2010

1. No provision has been made in accounts towards probable liability upto Jute year ended 30th June, 1998, if any, that may arise as a result of non-compliance with the requirements of Jute Packaging Materials (Compulsory Use of Packaging Commodities) Act, 1987, consequent to differring decisions of different courts and also the representations of industry before the Government, since the same is not ascertainable at this stage.

2. Fixed Assets : Lands includes Rs. 4,62,475/- being the value of Land measuring 14.23 Acres of Magazine Land at Macherla assigned and notified in Revenue records vide Dist. Collector, Guntur order No. Re No. 3567/2000-E1, dt. 23.10.2002 in favour of company.

3. Advances include Rs. 7,01,370/- (8,22,675) being the value of Land measuring 62.56 Acres (73.38 Acres) registered in the name of the company, for exchange to the Andhra Pradesh State Government under the re-afforestation programme in compensation for getting the mining lands in favour of Company.

4. Cash and Bank balances include

a. Rs. 1,50,000/- (Rs. 1,50,000/-) on account of Staff Security Deposit.

b. Rs.1,14,36,780/- (Rs. 1,02,52,198/-) towards Unclaimed Dividends.

c. Rs.9,40,02,895 /- (Rs. 1,56,55,187/-) representing Fixed Deposit Receipts lodged with Bankers as securities against Guarantees issued by them.

d. Rs.2,30,06,320/- (Rs. 1,63,93,546/-) deposited as per provisions of 58Aof the Companies Act 1956 and the Rules made there under.

5. Particulars disclosed pursuant to "AS-18 Related Party Disclosures" :- A. List of Related parties

Subsidiary Company

KCP Vietnam Industries Limited

Joint Venture Company

Fives Cail KCP Limited

Key Management Personnel (KMP)

Dr. V.L. Dutt - Chairman and Managing Director Smt. V.L. Indira Dutt - Joint Managing Director Smt. Kavitha D Chitturi - Executive Director Sri V Gandhi - Technical Director

Relatives of Key Management Personnel

Dr. V.L. Dutt -

Smt. Rajeswary Ramakrishanan - Sister Smt. V.L. Indira Dutt - Smt. S.R.V Rajyalakshmamma - Mother Sri. V. Chandra Kumar - Brother Smt. Uma S Vallabhaneni - Sister Smt.V Rama Kumari - Sister Smt. Kavitha D Chitturi - Kum.Shivani Dutt Chitturi - Daughter Sri. Ravi Chitturi - Husband Sri. V.Gandhi -

Smt. V Kamala Devi - Wife

Sri. V. Praveen Kumar - Son

Smt. V. Anupama - Daughter

Sri. N. Seshubabu - Daughters Husband

Companies controlled by Key Management Personnel/Relatives

KCP Technologies Limited

V Ramakrishna Sons Private Limited The Jeypore Sugar Company Ltd.

VRK Grandsons Investment (P) Limited

V Ramakrishna Charitable Trust

6. Paise have been rounded off.

Figures in brackets indicate those for the previous year. Figures for the previous year have been regrouped, wherever necessary.

 
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