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Notes to Accounts of KEI Industries Ltd.

Mar 31, 2016

1. Rights, preferences and restrictions attached to shares:

Equity Shares: The Company has issued one class of equity shares having face value of Rs, 2 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

2. Shares reserved for issue under KEI Employees Stock Option Scheme, 2015:

During the year, Nomination and Remuneration Committee of the Board has granted 2,252,000 Options to eligible employees of the Company. Accordingly 2,252,000 Equity Shares (Previous Year Nil) of Rs, 2/- each are reserved for the issue under KEI Employees Stock Option Scheme 2015 (KEI ESOS 2015). Refer Note 24.2.

3. Written Down Value of Assets whose useful life is already exhausted as on 1st April, 2014, amounting to Nil ( Previous Year Rs, 20.27 millions) has been recognized in the opening balance of General Reserve.

4. Are amortized over period of foreign currency monetary item or up to 31st March 2020, whichever is earlier.

4.1 Nature of Security:

- Term Loans from Banks and Non- Banking Financial Company (NBFC) are Secured by a first pari passu charge over Land & Building, Plant & Machinery and other movable fixed assets located at the Company''s Plants at Plot No. A-280-284, Chopanki, SP-919,Bhiwadi and 99/2/7, Madhuban Industrial Estate, Silvassa. Further, they are secured by personal guarantee of Shri Anil Gupta, Chairman-cum-Managing Director of the Company.

4.2 Finance Lease Obligations are secured against leased assets.

5.1 Working Capital facilities from banks are secured by 1st pari-passu charge by way of hypothecation on the entire current assets including raw material, stock in process, finished goods, consumable stores & spares and receivables of the Company, 1st pari-passu charge on present and future fixed assets at SP-920 & SP-922, RIICO Industrial Area, Phase III, Bhiwadi , Distt. Alwar (Rajasthan) and movable fixed assets at D-90, Okhla Industrial Area, Phase I , New Delhi , 2nd pari-passu charge by equitable mortgage of property of the Land and Building at 99/2/7, Madhuban Industrial Estate, Village Rakholi, Silvassa (D & N H), Plot No. A 280-284, Chopanki and SP-919, RIICO Industrial Area, Phase III, Bhiwadi, Distt. Alwar (Rajasthan) both present and future. Further, they are secured by personal guarantee of Shri. Anil Gupta, Chairman-cum- Managing Director of the Company.

6.1 Company has formed a Joint Venture under name of Joint Venture of M/s KEI Industries Ltd New Delhi & M/s Brugg Kable AG Switzerland (JV). This JV is a Jointly Controlled Entity within the meaning of Accounting Standard - 27 on "Financial Reporting of Interests in Joint Ventures". The JV is in form of a Association of Persons (AOP) and the Company is having 100% share in Profit / Loss of AOP. Company has not invested any amount as capital in JV.

Revenue from Operations includes in few cases, Excise Duty, VAT & Service Tax, wherever prices, are inclusive of Taxes.

7. Employee Stock Options:

a) During the year, the Company has approved "KEI Employees Stock Option Scheme" (KEI ESOS 2015 or Scheme) for granting Employees Stock Options in the form of Equity Shares to eligible employees and the same was approved by special resolution passed by the members of the Company on September 16, 2015. The plan is administered under the supervision of the Nomination and Remuneration Committee of the Board of Directors of the Company ("Committee") in compliance with the provisions of Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 and other applicable provisions for the time being in force. During the year Nomination and Remuneration Committee has granted 2,252,000 Options on September 23, 2015 which will vest over a period of four years from the date of grant in the following manner:

8. In terms of provision of AS –7 on "Construction Contracts" for Lump Sum Turnkey Projects for contract in progress as on 31.03.2016:

i) The aggregate amount of cost incurred and recognized profit up to 31.03.2016 Rs, 9,201.63 millions (Previous year Rs, 4,351.89 millions)

ii) The amount of advances received Rs, 85.57 millions (Previous year Rs, 144.71 millions)

iii) The amount of retention Rs, 781.64 millions (Previous year Rs, 444.58 millions)

iv) Gross amount due to customers Rs, 616.28 millions (Previous year Rs, 145.94 millions)

v) Gross amount due from customers Rs, 276.82 millions (Previous year Rs, 332.20 millions)

9. Related Party Disclosures as required by Accounting Standard (AS-18): a) Name of Related Parties :

i) Subsidiary Company

KEI Cables Australia PTY Limited -- Wholly owned subsidiary ( w.e.f. 14/12/2015)

ii) Jointly controlled entity

Joint Venture of M/s KEI Industries Ltd., New Delhi & Brugg Kabel A.G. Switzerland ( w.e.f 24/06/2014) (Association of Persons)

iii) Associate of The Company

KEI International Limited (up to 20/06/2014)

iv) Other related parties in the group where common control exists:

Anil Gupta (HUF)

Projection Financial & Management Consultants Pvt. Ltd.

Shubh Laxmi Motels & Inns Pvt. Ltd.

Soubhagya Agency Pvt. Ltd.

Dhan Versha Agency Pvt. Ltd.

KEI Cables Pvt. Ltd.

KEI Power Ltd.

v) Key Managerial Personnel:

Shri Anil Gupta, Chairman-cum-Managing Director

Shri Rajeev Gupta, Executive Director Finance

Shri Kishore Kunal, Company Secretary (w.e.f. 01/10/2014)

vi) Relatives of Key Managerial Personnel with whom transaction have taken place:

Shri Sunil Gupta

Smt. Archana Gupta (Director)

Smt. Varsha Gupta

Smt. Sumitra Devi Gupta

Smt. Shashi Gupta

Smt. Vimla Devi

Smt. Veena Agarwal

vii) Enterprises Over which person mentioned in (vi) above are able to exercise significant control and transactions have taken place:

Sunil Gupta (HUF)

Ashwathama Constructions Pvt. Ltd.

c) Non Financial Transactions:

(i) Shri Anil Gupta has given personal guarantee to banks for Company''s borrowings.

(ii) The remuneration does not include Gratuity and Provision for leave encashment under Accounting Standard-15 (Revised), medic aim and personal accident insurance premium, since same is not available for individual employees. (iii) The Company has given Performance Bank Gurantees of Rs, 59.31 millions (previous year Rs, 189.96 millions) on behalf of Joint Venture of M/s KEI Industries Ltd., New Delhi & Brugg Kabel A.G. Switzerland.

10. Operating Leases-Other than non-cancellable:

The Company has entered into lease transactions during the current financial year mainly for leasing of factory/office/residential premises/computers and Company leased accommodations for its employees for periods up to 10 years. Terms of lease include terms of renewal, increase in rents in future periods and terms of cancellation. The Operating lease payments recognized in the Profit & Loss amount to Rs, 40.55 millions (Previous year Rs, 38.05 millions) for the leases which commenced on or after April 1, 2001.

iii) The Segment Revenue in the geographical segments considered for disclosure are as follows:

a) Revenue within India includes sales to customers located within India and earnings in India.

b) Revenue outside India includes sales to customers located outside India and earnings outside India.

iv) Segment Revenue, Results, Assets and Liabilities include the respective amounts identifiable to each of the segments and amounts allocated on a reasonable basis.

11.(c) Notes :

i) The Company is organized into business segments, namely:

– Cables comprising of EHV, HT & LT Power Cables , Control and Instrumentation Cables, Winding Wires & Flexible and House Wires. – Stainless Steel Wire comprising of Stainless Steel Wire. – Turnkey projects etc.

Segments have been identified and reported taking into account, the nature of products and services, the differing risks and returns, the organization structure, and the internal financial reporting systems.

ii) Segment Revenue in each of the above domestic business segments primarily includes sales, job work income and export incentives in the respective segments.

12. Previous Year''s figures have been regrouped / rearranged wherever necessary.


Mar 31, 2015

1. Rights, preferences and restrictions attached to shares:

Equity Shares: The company has issued one class of equity shares having face value of Rs. 2 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

2. Written Down Value of Assets whose useful life is already exhausted as on 1st April, 2014, amounting to Rs. 20.27 millions has been recognised in the opening balance of General Reserve.

3. Are amortised over period of foreign curreny monetary item or upto 31st March, 2020, whichever is earlier.

4. Nature of Security:

* Term Loans from Banks and Non- Banking Financial Company (NBFC) are Secured by a first pari passu charge over Land & Building, Plant & Machinery and other movable fixed assets located at the Company's Plants at Plot No. A-280-284, Chopanki, SP-919,Bhiwadi and 99/2/7, Madhuban Industrial Estate, Silvassa. Further, they are secured by personal guarantee of Shri Anil Gupta, Chairman-cum-Managing Director of the Company.

5. Finance Lease Obligations are secured against leased assets.

6. Unsecured Deposits are repayable within 3 years from the date of acceptance.

7. Working Capital facilities from banks are secured by 1st pari-passu charge by way of hypothecation on the entire current assets including raw material, stock in process, finished goods, consumable stores & spares and receivables of the Company, 1st pari-passu charge on present and future fixed assets at SP-920 & SP-922, RIICO Industrial Area Phase III, Bhiwadi, Distt. Alwar (Rajasthan) and movable fixed assets at D-90, Okhla Industrial Area, Phase I , New Delhi, 2nd pari-passu charge by equitable mortgage of property of the Land and Building at 99/2/7, Madhuban Industrial Estate, Village Rakholi, Silvassa (D & N H), Plot No. A 280-284, Chopanki and SP-919, RIICO Industrial Area Phase III, Bhiwadi , Distt. Alwar (Rajasthan) both present and future. Further, they are secured by personal guarantee of Shri. Anil Gupta, Chairman-cum-Managing Director of the Company.

8. In terms of Section 22 of the Micro, Small and Medium Enterprises Development Act 2006, the outstanding to these enterprises are required to be disclosed. However, these enterprises are required to be registered under the Act. In absence of information about registration of the enterprises under the above Act, the required information could not be furnished.

9. No amount is due for credit to Investor Education and Protection Fund (Fund). Amount remaining due after adjustment of amounts to be claimed from the Company will be transferred on the respective due dates to Fund.

10. Carrying value of Assets acquired under hire purchase as on 31.03.2014 exclude the amount related to hire purchase agreement settled during the current year.

11. During the current year, depreciation has been provided on fixed assets as per the useful life specified in Part C of Schedule II of the Companies Act, 2013 and as per assessment of useful life by the management and independent technical evaluation carried out by external valuer. In case of existing assets, depreciation has been provided based on remaining useful life of the assets. Assets whose useful life is already exhausted as on 1st April, 2014, amounting to Rs. 20.27 millions has been recognised in the opening balance of General Reserve. Had there been no change in useful life of the assets, depreciation expense for the year would have been lower by Rs. 23.34 millions.

12. During the year company has formed a Joint Venture under name of Joint Venture of M/s KEI Industries Ltd New Delhi & M/s Brugg Kabel AG Switzerland (JV). This JV is a Jointly Controlled Entity within the meaning of Accounting Standard - 27 on "Financial Reporting of Interests in Joint Ventures". The JV is in form of a Association of Persons (AOP) and the company is having 100% share in Profit / Loss of AOP. Company has not invested any amount as capital in AOP.

13. Due from Joint Venture of M/s KEI Industries Ltd New Delhi & M/s Brugg Kabel AG Switzerland (JV) as on 31.03.2015 isRs.65.57 millions.

15. Jobs with lump-sum price, where the physical progress of work is less than 25 per cent, the direct costs incurred thereon amounting to Rs. 153.12 millions (Previous Year Rs. 21.87 millions) have been carried forward as Project Work In Progress.

16. Represents excise duty borne by the company and difference between excise duty on opening stock and closing stock of finished goods.

17. Insurance premium of NIL (Previous year Rs. 2.09 millions) on Keyman Insurance Policy has been charged to Profit & Loss Account. Maturity value ofsuch policy has been accounted for on receipt basis during the year as an exceptional item.

18. Gross amount required to be spent on Corporate Social Responsibility by the company during the year Rs. 6.82 millions.

19 In terms ofprovision of AS -7 on "Construction Contracts" for Lump Sum Turnkey Projects for contract in progress as on 31.03.2015

i) The aggregate amount of cost incurred and recognised profit upto 31.03.2015 Rs.4,351.89 millions (Previous year Rs. 2,792.47 millions)

ii) The amount of advances received Rs. 144.71 millions (Previous year Rs. 141.94 millions)

iii) The amount of retention Rs. 444.58 millions (Previous year Rs. 215.00 millions)

iv) Gross amount due to customers Rs. 145.94 millions (Previous year Rs. 24.21 millions)

v) Gross amount due from customers Rs. 332.20 millions (Previous year Rs. 251.78 millions)

20. Related party Disclosures as required by Accounting Standard (AS-18):

a) Name of Related Parties:

i) Jointly controlled entity:

Joint Venture of M/s KEI Industries Ltd., New Delhi & Brugg Kabel A.G. Switzerland ( w.e.f 24/06/2014)

ii) Associate of The company:

KEI International Limited (up to 20/06/2014)

iii) Other related parties in the group where common control exists:

Anil Gupta (HUF)

Projection Financial & Management Consultants Pvt. Ltd.

Shubh Laxmi Motels and Inns Pvt. Ltd.

Soubhagya Agency Pvt. Ltd.

Dhan Versha Agency Pvt. Ltd.

KEI Cables Pvt. Ltd.

KEI Power Ltd.

iv) Key Managerial Personnel:

Shri Anil Gupta, Chairman-cum-Managing Director

Shri Rajeev Gupta, Executive Director Finance

Shri Kishore Kunal, Company Secretary (w.e.f. 01/10/2014)

v) Relatives of Key Managerial Personnel with whom transaction have taken place:

Shri Sunil Gupta

Smt. Archana Gupta (Director)

Smt. Varsha Gupta Smt. Sumitra Devi Gupta Smt. Shashi Gupta Smt. Vimla Devi Smt. Veena Agarwal

vi) Enterprises over which person mentioned in (v) above are able to exercise significant control and transactions have taken place:

Sunil Gupta (HUF)

Ashwathama Constructions Pvt. Ltd.

c) Non Financial Transactions:

(i) Shri Anil Gupta has given personal guarantee to banks for company's borrowings.

(ii) The remuneration does not include Gratuity and Provision for leave encashment under Accounting Standard- 15 (Revised), mediclaim and personal accident insurance premium, since same is not available for individual employees.

(iii) The company has given Bank guarantees of Rs. 189.96 millions on behalf of Joint Venture of M/s KEI Industries Ltd., New Delhi & Brugg Kabel A.G. Switzerland.

21. Operating Leases-Other than non-cancellable:

The Company has entered into lease transactions during the current financial year mainly for leasing of factory/ office/residential premises/Computers and company leased accommodations for its employees for periods up to 10 years. Terms of lease include terms of renewal, increase in rents in future periods and terms of cancellation. The Operating lease payments recognized in the Profit & Loss amount to Rs. 38.05 millions (Previous year Rs. 28.34 millions) for the leases which commenced on or after April 1, 2001.

22. (c) Notes :

(i) The Company is organised into business segments, namely:

* Cables comprising of EHV, HT & LT Power Cables , Control and Instrumentation Cables, Winding Wires & Flexible and House Wires.

* Stainless Steel Wire comprising of Stainless Steel Wires.

* Turnkey projects etc.

Segments have been identified and reported taking into account, the nature of products and services, the differing risks and returns, the organisation structure, and the internal financial reporting systems.

iii) The Segment Revenue in the geographical segments considered for disclosure are as follows:

a) Revenue within India includes sales to customers located within India and earnings in India.

b) Revenue outside India includes sales to customers located outside India and earnings outside India.

iv) Segment Revenue , Results, Assets and Liabilities include the respective amounts identifiable to each of the segments and amounts allocated on a reasonable basis.

23 Contingent Liabilities & Commitments:

Particulars As at 31st March, 2015 (Rs. in Millions) 24.1 Contingent Liabilities

Claims Against the Company not acknowledged as Debt 0.22

24.2 Guarantees

Financial Bank Guarantees 1,316.34 outstanding

24.3 Other money for which company is contingently liable

a) Unutilised Letter of Credits 149.51

b) Outstanding Bills discounted 1,233.93

c) Prorata share of company in channel finance given by banks to others 349.16 1,732.60

24.4 Duties & Taxes

a) Sales Tax / Entry Tax demands 5.63 under appeal

b) Income tax Matters:

* Demand due to Additions / disallowances during Assessments 9.52

* Appellate decision in favour of company but department has filed appeal against

decision of Appellate Authorities -

c) Excise / Service tax demands under 76.87 appeal

d) Labour Cess Demands under appeal 13.13

e) Custom Duty demand under Appeal 395.72 500.87 (Refer Note 34.5)

Particulars As at 31st March, 2014 (Rs. in Millions) 24.1 Contingent Liabilities

Claims Against the Company not acknowledged as Debt 0.02

24.2 Guarantees

Financial Bank Guarantees 817.31 outstanding

24.3 Other money for which company is contingently liable

a) Unutilised Letter of Credits 174.78

b) Outstanding Bills discounted 375.29

c) Prorata share of company in channel finance given by banks to others 297.74 847.81

24.4 Duties & Taxes

a) Sales Tax / Entry Tax demands 30.68 under appeal

b) Income tax Matters:

* Demand due to Additions / disallowances during Assessments 0.49

* Appellate decision in favour of company but department has filed appeal against

decision of Appellate Authorities 8.65

c) Excise / Service tax demands under 88.51 appeal

d) Labour Cess Demands under appeal 10.43

e) Custom Duty demand under Appeal - 138.76 (Refer Note 34.5)

25. Custom duty demand including penalty for alleged non-fulfillment of export obligations of the company. Company has fulfilled all export obligations and demand has arisen due to non-issuance of Export Obligation Discharge Certificate (EODC) by Directorate General Of foreign Trade (DGFT). Company is following up with DGFT for issuance of EODC and has already obtained EODC for some cases. Company is also contesting demand before appellate authority and is confident that no liability will crystallize in this case.

26. Previous Year's figures have been regrouped / rearranged wherever necessary.


Mar 31, 2014

1.1 Rights, preferences and restrictions attached to shares:

Equity Shares: The company has issued one class of equity shares having par value of Rs. 2 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

Additions of 35,00,000 (Previous Year 33,00,000) equity shares were issued on preferential basis to following parties as per SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 at a price of? 14 per share (including securities premium of? 12/-).

1.2 During the year the Company has allotted 35,00,000 (thirty five lacs) Share Warrants on preferential basis to Promoter / Promoter Group. The Warrant Holder has option of subscribing one equity share of face value of Rs. 2/- each per Warrant at a price of Rs. 14/- per equity share any time up to 10.01.2015. Amount received from Warrant holders as on March 31, 2014 is Rs. 442.50 lacs

2.1 Proposed dividend includes dividend on equity shares due to conversion of warrants after 31st March, 2014.

2.2 Are amortised over period of foreign curreny monetary item or upto 31st March 2020, whichever is earlier.

3.1 Nature of Security:

— Term Loans from Banks are Secured by a first pari passu charge over Land & Building, Plant & Machinery and other movable fixed assets located at the Company''s Plants at Plot No. A-280-284, Chopanki, SP-919, Bhiwadi and 99/2/7, Madhuban Industrial Estate, Silvassa. Further, they are secured by personal guarantee of Mr. Anil Gupta, Chairman-cum-Managing Director of the Company.

3.2 Finance Lease Obligations are secured against leased assets.

3.3 Maturity Profile and rate of interest of Secured Term Loans are as set out below: (Rs. in lacs)

4.1 Working Capital facilities from banks are secured by 1st pari-passu charge by way of hypothecation on the entire current assets including raw material, stock in process, finished goods, consumable stores & spares and receivables of the Company, 1st pari-passu charge on present and future fixed assets at SP-920 & SP-922, RIICO Industrial Area Phase III, Bhiwadi, Distt. Alwar (Rajasthan) and movable fixed assets at D-90, Okhla Industrial Area, Phase I , New Delhi , 2nd pari-passu charge by equitable mortgage of property of the Land and Building at 99/2/7, Madhuban Industrial Estate, Village Rakholi, Silvassa (D & N H), Plot No. A 280-284, Chopanki and SP-919, RIICO Industrial Area Phase III, Bhiwadi, Distt. Alwar (Rajasthan) both present and future. Further, they are secured by personal guarantee of Mr. Anil Gupta, Chairman-cum-Managing Director of the Company.

5.1 In terms of Section 22 of the Micro, Small and Medium Enterprises Development Act 2006, the outstanding to these enterprises are required to be disclosed. However, these enterprises are required to be registered under the Act. In absence of information about registration of the enterprises under the above Act, the required information could not be furnished.

6.1 No amount is due for credit to Investor Education and Protection Fund (Fund). Amount remaining due after adjustment of amounts to be claimed from the Company will be transferred on the respective due dates to Fund.

6.2 As per changes made in AS-11 vide Companies(Accounting Standards) Amendment Rules 2009, further amended vide Amendment Rules 2011, during financial year 2008-09 company exercised option of deferring foreign exchange difference arising on long term foreign currency monetary items viz ''FCCBs'', Foreign Currency Term Loan to the Profit and Loss account, in respect of accounting periods commencing on or after 7th December, 2006. As a result, such foreign exchange difference relating to the acquisition of depreciable capital assets have been adjusted with cost of such assets and would be depreciated over the balance life of the assets and in other cases has been accumulated in ''FCMITDA''. Exchange loss (net) NIL (Previous year?77.75 lacs exchange loss) has been adjusted in gross Block of Fixed assets and capital-work-in progress. Exchange difference on External commercial borrowings (ECB''s) raised for repurchasing FCCB''s has been transferred to FCMITDA.

7.1 Jobs with lump-sum price, where the physical progress of work is less than 25 per cent, the direct costs incurred thereon amounting to Rs. 218.71 lacs (Previous Year Rs. 60.91 lacs) have been carried forward as Project Work in Progress.

Defined Benefit Plans

The company is having following Defined Benefit Plans:

- Gratuity (Partly Funded)

- Leave Encashment (Unfunded)

8.1 Represents excise duty borne by the company and difference between excise duty on opening stock and closing stock of finished goods 26.2 Insurance premium of Rs.20.92 lacs (Previous year Rs. 20.88 lacs) on Keyman Insurance Policy has been charged to

Profit & Loss Account. Maturity value of such policy will be accounted for on receipt basis.

The Company has not remitted any amount in foreign currencies on account of dividends during the year and does not have information as to the extent to which remittances, if any, in foreign currencies on account of dividends have been made by / on behalf of non-resident shareholders. The particulars of dividends declared and paid to non-resident shareholders for the year 2012-13 & 2011-12 are as above.

9 In terms of provision of AS –7 on "Construction Contracts" for Lump Sum Turnkey Projects for contract in progress as on 31.03.2014 i ) The aggregate amount of cost incurred and recognised profit upto 31.03.2014 Rs. 27,924.74 lacs (Previous year Rs. 19,896.46 lacs).

ii) The amount of advances received Rs. 1,419.40 lacs (Previous year NIL)

iii) The amount of retention Rs. 2,149.98 lacs (Previous year Rs. 2,047.84 lacs)

iv) Gross amount due to customers Rs. 242.12 lacs (Previous year Rs. 117.21 lacs)

v) Gross amount due from customers Rs. 2,517.77 lacs (Previous year Rs. 1628.08 lacs)

10 Related party Disclosures as required by Accounting Standard (AS-18): a) Name of Related Parties:

i) Associate of The company:

- KEI International Limited

i i) Other related parties in the group where common control exists:

- Anil Gupta (HUF)

- Projection Financial & Management Consultants Pvt. Ltd.

- Shubh Laxmi Motels & Inns Pvt. Ltd.

- Soubhagya Agency Pvt. Ltd.

- Dhan Versha Agency Pvt. Ltd.

- KEI Cables Pvt. Ltd.

- KEI Power Ltd.

iii) Key Managerial Personnel:

- Mr. Anil Gupta, Chairman-cum-Managing Director

- Mr. Rajeev Gupta, Executive Director (Finance)

iv) Relatives of Key Managerial Personnel with whom transaction have taken place:

Mr. Sunil Gupta - Mrs. Archana Gupta (Director)

Mrs. Varsha Gupta - Mrs. Sumitra Devi Gupta

Mrs. Shashi Gupta - Mr. Shrikrishan Gupta

Mrs. Veena Agarwal

v) Enterprises Over which person mentioned in (iv) above are able to exercise significant control and transactions have taken place:

- Sunil Gupta (HUF) - Ashwathama Constructions Pvt. Ltd.

c) Non Financial Transactions:

(i) Mr. Anil Gupta has given personal guarantee to banks for company''s borrowings.

(ii) The remuneration does not include Gratuity and Provision for leave encashment under Accounting Standard- 15 (Revised), mediclaim and personal accident insurance premium, since same is not available for individual employees.

11.1 Operating Leases-Other than non-cancellable:

The Company has entered into lease transactions during the current financial year mainly for leasing of factory/ office/residential premises/Computers and company leased accommodations for its employees for periods up to 10 years. Terms of lease include terms of renewal, increase in rents in future periods and terms of cancellation. The Operating lease payments recognized in the Profit & Loss amount to Rs. 283.45 lacs (Previous year Rs. 399.61 lacs) for the leases which commenced on or after April 1, 2001.

12. (c) Notes :

( i ) The Company is organised into business segments, namely:

– Cables comprising of EHV, HT & LT Power Cables , Control and Instrumentation Cables, Winding Wires & Flexible and House Wires

– Stainless Steel Wire comprising of Stainless Steel Wire.

– Turnkey projects etc

Segments have been identified and reported taking into account, the nature of products and services, the differing risks and returns, the organisation structure, and the internal financial reporting systems.

ii) Segment Revenue in each of the above business segments primarily includes sales, job work income and export incentives in the respective segments.

iii) The Segment Revenue in the geographical segments considered for disclosure are as follows:

a) Revenue within India includes sales to customers located within India and earnings in India.

b) Revenue outside India includes sales to customers located outside India and earnings outside India.

iv) Segment Revenue, Results, Assets and Liabilities include the respective amounts identifiable to each of the segments and amounts allocated on a reasonable basis.

13 (i) Derivative contracts entered into by the company and outstanding:

For Hedging Currency and Interest Rate Related Risks:

Nominal amounts of derivative contracts entered into by the Company and outstanding as at 31st March, 2014 amount to Rs. 3,397.94 lacs (Previous Year Rs. 2333.15 lacs). Category wise break up is given below:

(ii) The company has hedged interest rate and currency risk for External Commercial Borrowing (''ECB'') by entering into an interest rate swap and option deal. The interest rate swap and option deal being a derivative transaction, on a going concern basis, is not likely to give rise to any loss necessitating any provision in the books of accounts of the company.

Contingent Liabilities & Commitments (Continue from previous page):

Particulars As at As at 31st March, 2014 31st March, 2013 (Rs,in Lacs) (Rs,in Lacs)

e) Income tax Matters: – Demand Under Appeal 4.95 - – Appellate decision in favour of company but department has filed

against decision of appellate 86.54 86.54 Authorities. f) Excise/Service tax demands 885.08 885.08 Under appeal g) Labour Cess Demands under 104.31 9,865.79 36.68 13743.39 Appeal

Commitments :

Estimated amount of contracts remaining to be executed on Capital Account 91.73 613.60

14. Previous Year''s figures have been regrouped / rearranged wherever necessary. As per our Separate Report of even date attached


Mar 31, 2013

1.1 Rights, preferences and restrictions attached to shares:

Equity Shares: The company has issued one class of equity shares having par value of Rs. 2 per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

2.1 Premium on redemption on FCCBs (net of tax impact) Nil (Previous Year Rs. 3,360.50 lacs) has been set off against Securities Premium Account.

2.2 Are amortised over period of foreign curreny monetary item or upto 31st March 2020, whichever is earlier.

3.1 Nature of Security:

— Term Loans from Banks are Secured by a First pari passu charge over Land & Building, Plant & Machinery and other movable fixed assets located at the Company''s Plants at Plot No. A-280-284 Chopanki, SP- 919,Bhiwadi and 99/2/7 Madhuban Industrial Estate, Silvassa. Further, they are secured by personal guarantee of Shri. Anil Gupta, Chairman-cum-Managing Director of the Company.

— Foreign Currency Loan (Buyer''s Credit) of Rs. Nill lacs (Previous Year Rs.508.77 lacs) are secured by 1st Pari-Passu charge by way of hypothecation on the entire current assets including raw material, stock in process, finished goods, consumable stores & spares and receivables of the Company, 1st pari-passu charge on present and future fixed assets at SP-920 & SP-922, RIICO Industrial Area Phase III, Bhiwadi, Distt. Alwar (Rajasthan) and movable fixed assets at D-90, Okhla Industrial Area, Phase I , New Delhi , 2nd pari-passu charge by equitable mortgage of property of the Land and Building at 99/2/7, Madhuban Industrial Estate, Village Rakholi, Silvassa (D & N H), Plot No. A - 280-284, chopanki and SP-919, RIICO Industrial Area Phase III, Bhiwadi, Distt. Alwar (Rajasthan) both present and future. Further, they are secured by personal guarantee of Shri. Anil Gupta, Chairman-cum-Managing Director of the Company.

3.2 Finance Lease Obligations are secured against leased assets.

4.1 Working Capital facilities from banks are secured by 1st Pari-Passu charge by way of hypothecation on the entire current assets including raw material, stock in process, finished goods, consumable stores & spares and receivables of the Company, 1st pari-passu charge on present and future fixed assets at SP-920 & SP-922, RIICO Industrial Area Phase III, Bhiwadi , Distt. Alwar (Rajasthan) and movable fixed assets at D-90, Okhla Industrial Area, Phase I, New Delhi , 2nd pari-passu charge by equitable mortgage of property of the Land and Building at 99/2/7, Madhuban Industrial Estate, Village Rakholi, Silvassa (D & N H), Plot No. A 280-284, Chopanki and SP-919, RIICO Industrial Area Phase III, Bhiwadi , Distt. Alwar (Rajasthan) both present and future. Further, they are secured by personal guarantee of Shri. Anil Gupta, Chairman-cum-Managing Director of the Company.

5.1 In terms of Section 22 of the Micro, Small and Medium Enterprises Development Act 2006, the outstanding to these enterprises are required to be disclosed. However, these enterprises are required to be registered under the Act. In absence of information about registration of the Enterprises under the above Act, the required information could not be furnished.

6.4 As per changes made in AS-11 vide Companies (Accounting Standards) Amendment Rules 2009, further amended vide Amendment Rules 2011, during financial year 2008-09 company exercised option of deferring foreign exchange difference arising on long term foreign currency monetary items viz ''FCCBs'', Foreign Currency Term Loan to the Profit and Loss account, in respect of accounting periods commencing on or after 7th December, 2006. As a result, such foreign exchange difference relating to the acquisition of depreciable capital assets have been adjusted with cost of such assets and would be depreciated over the balance life of the assets and in other cases has been accumulated in ''FCMITDA''. Exchange loss (net) Rs. 77.75 lacs (Previous year Rs. 1,254.42 lacs exchange loss) has been adjusted in gross Block of Fixed assets and capital-work-in progress. Exchange difference on External commercial borrowings (ECB''s) raised for repurchasing FCCB''s has been transferred to FCMITDA.

7 In terms of provision ofAS - 7 on "Construction Contracts" for Lump-sum Turnkey Projects for contract in progress as on 31.03.2013:

i) The aggregate amount of cost incurred and recognised profit upto 31.03.2013 Rs. 19,896.46 lacs (Previous year Rs. 6,770.08 lacs)

ii) The amount of advances received Rs. 1,272.15 lacs (Previous year Rs. 2,070.76 lacs).

iii) The amount of retention Rs. 2,047.84 lacs (Previous year Rs. 449.44 lacs).

iv) Gross amount due to customers Rs. 117.21 lacs (Previous year Rs. 42.62 lacs).

v) Gross amount due from customers Rs. 1,628.08 lacs (Previous year Rs. 3,714.55 lacs).

8 Related party Disclosures as required by Accounting Standard (AS-18):

a) Name of Related Parties :

i) Associate ofThe company:

- KEI International Limited

ii) Other related parties in the group where common control exists:

- Anil Gupta (HUF)

- Projection Financial & Management Consultants Pvt. Ltd.

- Shubh Laxmi Motels & Inns Pvt. Ltd.

- Soubhagya Agency Pvt. Ltd.

- Dhan Versha Agency Pvt. Ltd.

- KEI Cables Pvt. Ltd.

- KEI Power Ltd.

iii) Key Managerial Personnel:

- Shri Anil Gupta, Chairman-cum-Managing Director

- Shri Rajeev Gupta, Executive Director (Finance)

iv) Relatives of Key Managerial Personnel with whom transaction have taken place:

- Shri Sunil Gupta - Smt. Shashi Gupta

- Smt. Archana Gupta (Director) - Smt. Srikrishan Gupta

- Smt. Varsha Gupta - Smt. Veena Aggarwal

- Smt. Sumitra Devi Gupta

v) Enterprises Over which person mentioned in (iv) above are able to exercise significant control and transactions have taken place:

- Sunil Gupta (HUF) - Ashwathama Constructions Pvt. Ltd.

c) Non Financial Transactions:

(i) Shri Anil Gupta has given personal guarantee to banks for company''s borrowings.

(ii) The remuneration does not include Gratuity and Provision for leave encashment under Accounting Standard-15 (Revised), mediclaim and personal accident insurance premium, since same is not available for individual employees.

9.1 Operating Leases-Other than non-cancellable:

The Company has entered into lease transactions during the current financial year mainly for leasing of factory/ office/residential premises/Computers and company leased accommodations for its employees for periods up to 10 years. Terms of lease include terms of renewal, increase in rents in future periods and terms of cancellation. The Operating lease payments recognized in the Profit & Loss account amount to Rs. 399.61 lacs (Previous year Rs. 398.58 lacs) for the leases which commenced on or after April 1, 2001.

10 (c) Notes :

(i) The Company is organised into business segments, namely:

- Cables comprising of EHV, HT & LT Power Cables , Control and Instrumentation Cables, Winding Wires & Flexible and House Wires

- Stainless Steel Wire comprising of Stainless Steel Wire.

- Turnkey projects etc

Segments have been identified and reported taking into account, the nature of products and services, the differing risks and returns, the organisation structure, and the internal financial reporting systems.

iii) The Segment Revenue in the geographical segments considered for disclosure are as follows:

a) Revenue within India includes sales to customers located within India and earnings in India.

b) Revenue outside India includes sales to customers located outside India and earnings outside India.

iv) Segment Revenue, Results, Assets and Liabilities include the respective amounts identifiable to each of the segments and amounts allocated on a reasonable basis.

11 Previous Year''s figures have been regrouped / rearranged wherever necessary. As per our Separate report of even date attached

 
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