Mar 31, 2023
The Board of Directors takes pleasure in presenting the report on the operations and business of the Company along with Audited Financial Statements for the Financial Year ended 31st March, 2023.
FINANCIAL RESULTS |
('' in Lakhs) |
|||
Particulars |
Standalone |
Consolidated |
||
Sales and Other Income:- |
2022-23 |
2021-22 |
2022-23 |
2021-22 |
Domestic Sales |
2,85,579 |
2,42,442 |
3,69,601 |
2,95,811 |
Export Sales |
1,71,502 |
1,52,427 |
2,26,417 |
1,71,667 |
Other Income |
29,886 |
20,961 |
28,802 |
23,492 |
4,86,967 |
4,15,830 |
6,24,820 |
4,90,970 |
|
Profit before Interest & Depreciation |
92,909 |
1,06,853 |
1,33,671 |
1,30,593 |
Less : Interest |
2,670 |
1,339 |
7,886 |
2,329 |
Depreciation |
7,764 |
7,565 |
17,369 |
14,112 |
Profit Before Tax |
82,475 |
97,949 |
1,08,416 |
1,14,152 |
Less : Taxation:- |
||||
Provision for Current Tax |
18,324 |
24,870 |
25,273 |
29,706 |
Tax relating to earlier years |
(802) |
(75) |
(982) |
(53) |
17,522 |
24,795 |
24,291 |
29,653 |
|
Deferred Tax expense / Credit |
1,449 |
74 |
2,715 |
315 |
Profit After Tax |
63,504 |
73,080 |
81,410 |
84,184 |
Other Comprehensive Income (Net of tax) |
- |
- |
- |
- |
Total Comprehensive Income |
63,504 |
73,080 |
81,410 |
84,184 |
The year began with a positive note of robust growth and profitability. But the steep increase in cotton prices at all time high level coupled with lower yarn price realisation has trimmed the cotton-yarn spreads. However, the supportive trends in garment segment enabled better performance, overcoming these challenges. The wind power generation during the year was good. Despite the adverse factors like Global recession, Ukraine war, huge volatility in cotton prices, high inflation etc., the inherent strengths enabled KPR repeating a better performance during the year also.
The cotton prices have started stabilising and the garment order position continues to be encouraging. The Indian textile industry is optimistic of retaining the growth level with the supportive Government policies, FTAs with significant markets that are likely to create more market opportunities for entire textile value chain. To improve its performance further, KPR has contemplated certain modernisation and expansion plans.
During the year, we have installed 10 MW rooftop Solar Power plant whose benefit can be derived from the current year, upon receipt of the approval from TANGEDCO.
The Company also have plans to establish separate Spinning Mill for Viscose Yarn production, besides expanding Ethanol production capacity through our Wholly Owned Subsidiary Companies. Considering the developments in the textile market further plans may be decided by the Board at appropriate time.
Consumersâ increasing focus on sustainability and ethical production has added significance to our FASO products, which are organic centric. Enthused by the response to various styles in Menâs wear, we have introduced Womenâs wear also in October 2022, which is also well received in the Market. Consequent on
better handling of the pandemic by Indian Authorities over the years, its impact started receding that enabled resurgence of our efforts towards âPan-Indiaâ spread. In addition to the Southern States, we have already launched FASO products in some of the States of commercial importance and planning to add more such States in the current year.
Considering better performance and strong liquidity during the year, the Board of Directors have declared an Interim Dividend @ 200% on equity shares ('' 2 per Equity Share) at their meeting held on 06.02.2023. The Board in its meeting held on 03.05.2023 also has recommended a Final Dividend of 200% ('' 2 per Equity Share) on Equity Shares, thus aggregating to 400 % ('' 4 per Share on Equity Share of Face Value of '' 1 each), for the Financial Year 2022-23, subject to the approval of the Members of the Company at the 20th (Twentieth) Annual General Meeting.
Consequent to the expansion of Garment & Sugar business and the availment of additional Working Capital, the finance charges has gone up over previous year. However, led by the successful financial planning comfortable financial position continued during the year also. Some of the term loans availed for the new garment project were repaid and fresh term loan from Banks was availed towards the expansion of Ethanol project in our wholly owned Subsidiary Company.
The statements pursuant to Section 129(3) of the Companies Act, 2013 (Hereinafter referred to as the ''Act'') in âForm AOC - 1â containing the details of following Wholly Owned Subsidiary Companies forms part of this Annual Report. However as required by the ''Act'', we give below a brief report on their performance.
I. K.P.R. Sugar Mill Limited
II. KPR Sugar and Apparels Limited
III. Jahnvi Motor Private Limited
IV. Quantum Knits Pvt. Limited
V. Galaxy Knits Limited
VI. KPR Exports Plc
VII. KPR Mill Pte. Ltd.
The year under review was a successful year for the Indian Sugar industry and is on track for steady growth in the current year too. Though the acreage remains the same, the yield was better due to crop variety, better farming practices, etc. With the Governmentâs continuous support towards the sugar sector and increasing focus on diversion towards ethanol production to promote Ethanol Blending Program in India, the sugar sector is likely to gain traction going forward.
Encouraged by the success of achieving the target of 10 percent Ethanol blending in petrol, much ahead of the target date, the
Government advanced the target of 20 percent ethanol blending to the year 2025 (earlier 2030). To increase revenue we are planning to expand Ethanol production capacity.
The sugarcane crushing for sugar season 2022-23 commenced in October 2022, produced 1,22,730 MT of Sugar. The Co-gen plant produced 1437.38 lakhs units of Power. Out of the same, 796.21 lakhs units were sold and 641.17 lakh units were captively consumed. During the year 38,936.42 KL of Ethanol was produced, using Sugar Syrup and Molasses and the entire production was sold to Oil Marketing Companies. The expansion plan to increase Ethanol production capacity from 90 KLPD to 240 KLPD with Zero Liquid Discharge System is in progress.
During the year, an Interim Dividend of '' 130/- on the Equity shares of Face Value of '' 10/- each was declared by its Board in its meeting held on 06.02.2023.
KPR SUGAR AND APPARELS LIMITED
Ramping up of production in the new 42 million Garments capacity at Chengapally, Tirupur district, Tamil Nadu has been completed and is successfully executing the orders from International Buyers.
The sugarcane crushing for sugar season 2022-23 commenced in November 2022, produced 98,565 MT of Sugar. The Co-gen plant produced 1,468.85 lakhs units of power. Out of the same, 900.34 lakhs units were sold and 568.51 lakh units were captively consumed. During the year 29,866 KL of Ethanol was produced, using Sugar Syrup and Molasses and the entire production was sold to Oil Marketing Companies.
During the year, the Company could sell 156 Audi Cars and earned a total revenue of '' 113.91 Crores. Steady economic growth amid signs of moderating inflation, coupled with strong earnings, is fueling the demand at the higher end of the market and supporting sales of luxury vehicles. Local demand continues to be strong.
During the year, an Interim Dividend of '' 1500/- on the Equity shares of Face Value of '' 10/- each out of accumulated reserves was declared by its Board in its meeting held on 06.02.2023.
The Company has not yet commenced its operation.
As informed in the earlier report, we have already approached the Ethiopian Authorities seeking their assistance to formally close the Apparel manufacturing unit at Ethiopia due to civil disturbance and to bring back capital materials therein. The same is being followed up.
KPR MILL PTE. LTD ( SINGAPORE )
The Company was established primarily for the purpose of marketing the products manufactured at Ethiopia. However, considering the changed business environment therein and the growing International trade at our Company, the Management is planning to utilise the services of this Company for its future business plans.
The Company has not accepted any deposits from public during the year under review.
Mr. K.N.V. Ramani, Independent Director passed away on 30.03.2023. Taking note of his long association and sane advice, the Board placed on record the invaluable services rendered by him as Lead Independent Director and Corporate Lawyer.
The Board of Directors, at its meeting held on May 03, 2023, based on the recommendation of the Nomination & Remuneration Committee appointed Mrs V. Bhuvaneshwari (DIN: 01628512) as an Additional Director (Non-Executive & Independent) to hold office till the conclusion of the ensuing Annual General Meeting and subject to the approval of the members in the said Annual General Meeting appointed as âWoman Independent Directorâ of the Company to hold office for a term upto 5 consecutive years. To regularize her appointment in the 20th Annual General Meeting (AGM) of the Company, suitable resolution is included in the notice of AGM proposing her appointment.
Pursuant to the provisions of Rule 6 of the Companies (Appointment and Qualifications of Directors) Rules, 2014, Mrs.V. Bhuvaneshwari (DIN: 01628512) had passed the online proficiency self-assessment test conducted by the âIndian Institute of Corporate Affairsâ.
The Company has adequate Independent Directors in compliance with the Act and SEBI (Listing Obligations and Disclosures Requirements) Regulation, 2015 (Hereinafter referred to as Listing Regulations). Familiarization Program on the Company and its operation was conducted for the Independent Directors. Requisite declaration from the Independent Directors of the Company under Section 149 (7) of the Act confirming that they meet with the criteria of their Independence laid in Section 149 (6) have been obtained.
Mr.C.R.Anandakrishnan, Executive Director, retires by rotation at the ensuing Annual General Meeting and is eligible for re-appointment.
KEY MANAGERIAL PERSONNEL AND MANAGERIAL REMUNERATION CRITERIA
In pursuance of the Act the Company has Key Managerial Personnel. None of the Managing Directors or Whole Time Directors receives any remuneration or commission from the Subsidiary Companies and the remuneration paid to them is within the purview of the provisions of Section 197 of the Act. The Company pays remuneration by way of salary, perquisites,
commission etc., to its Chairman, Managing Directors and fixed monthly remuneration to its Executive Directors and Whole Time Director in line with the approvals accorded by the General Meetings and in pursuance of the recommendation of the Nomination and Remuneration Committee as per the guiding principles laid down in the Nomination and Remuneration Policy. The information as required by Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended.
In line with the criteria evolved by the Nomination and Remuneration Committee, the performance of all Directors, Committees, Chairman etc., have been evaluated pursuant to the provisions of the Act and the Listing Regulations.
As required by the provisions of the Act and Listing Regulations, the Company has already formed the following Committees, the details of which are disclosed in the Report on Corporate Governance forming part of this Report.
I. Audit Committee
II. Stakeholders Relationship Committee
III. Nomination and Remuneration Committee
IV. Corporate Social Responsibility (CSR) Committee
V. Risk Management Committee
In pursuance of the Act and the Listing Regulation, the following policies have been framed and disclosed on the Company''s website www.kprmilllimited.com
I. Nomination & Remuneration Policy
II. Related Party Transaction Policy
III. CSR Policy
IV. Whistle Blower Policy consisting of Vigil Mechanism
V. Policy on Determining Material Subsidiaries
VI. Code for Fair Disclosure
VII. Risk Management Policy
VIII. Dividend Distribution Policy
The Web-link - https://kprmilllimited.com/file/wp-content/uploads/2018/11/DD-Policy.pdf
IX. Policy for Disclosure of Material Events / Information
X. Policy on Succession Planning for Board and Senior Management
Pursuant to section 134(3) (n) of the Act & Regulation 17(9) of the Listing Regulation, the Company has a Risk Management Policy and has constituted a Risk Management Committee. The Risk Management Committee held its meetings on 29.06.2022 and
19.12.2022 in which all members were present.
VIGIL MECHANISM & WHISTLE BLOWER POLICY
The Company has an established Vigil Mechanism for Directors and Employees to report concerns about unethical behaviors, actual or suspected fraud or violation of the code of conduct or ethics policy. It also provides for adequate safeguards against victimization of Directors/Employees who avail of the mechanism. The Company affirms that no personnel have been denied access to the Audit Committee. The Company has a Policy of Vigil Mechanism and has established a mechanism that any personnel may raise reportable matters. All suspected violations and reportable matters can be reported to the Chairman of the Audit Committee at e-mail id [email protected] The key directions/ actions can be informed to the Chairman/ Managing Director of the Company. The Whistle Blower Policy has been reviewed by the Board of Directors and displayed in the Companyâs website.
During the year, in pursuance of the recommendations of the CSR committee the Company has contributed '' 6307.89 Lakhs towards implementing the CSR activities including an advance contribution of '' 5017.30 lakhs which is equal to 3 Yearsâ estimated CSR contribution to be set-off against subsequent yearsâ CSR obligation. Annual Report on CSR, as required by the Act, is appended.
The Board of Directors met Four times during the financial year on 27.04.2022, 28.07.2022, 07.11.2022 and 06.02.2023 through physical mode. The Composition of Board, procedure, venue, dates, time and other details are included in the Corporate Governance Report that forms part of this Report.
CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in annexing the Consolidated Financial Statements pursuant to the provisions of the ''Act'' and the Listing Regulations entered into with the Stock Exchanges. They are prepared in accordance with the Ind-AS prescribed by the Institute of Chartered Accountants of India, in this regard. The Consolidated Financials also marked a significant increase in its Revenue as well as Profitability.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has duly complied with the provisions of Section 186 of the Act and as required therein the details of the Borrowals, Security, Investment etc., are annexed by way of notes to accounts.
All Related Party Transactions that were entered into during the financial year were only between Holding Company and Wholly owned Subsidiary Companies in the ordinary course of business, whose accounts are consolidated with Holding Company and placed before the shareholders at the General Meeting for approval. However, as per regulatory requirements an omnibus approval of the audit committee for such transactions has been obtained.
The Transactions as required under Indian Accounting Standards âInd AS-24'' are reported in Note 40 of the Notes to Accounts of the Standalone Financial Statements as well as Note 40 of the Notes
to Accounts of the Consolidated Financial Statements of your Company. The Company''s Policy on dealing with related party transactions is available on the Company''s website.
India has a large working population, a prominent asset in the labour-intensive textiles sector particularly in Garment industry. They are crucial stakeholders playing an integral role in the success of an organisation. KPR continuously takes concrete steps to promote the wellbeing of work force at work and good work-life balance. One of the significant efforts towards the same is provision of Higher Education facility. Employees who receive higher education tend to have improved sense of self-worth with more opportunities to grow besides contributing to the success of the Organisation. Our unique Career development process for the employees based on their educational qualification also continues.
The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and others entitled thereto, excluding the information on employees'' particulars which is available for inspection by the members at the Registered Office of the Company during business hours on working days of the Company upto the date of ensuing Annual General Meeting. If any member is interested in inspecting the same, such member may write to the Company Secretary in advance.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 provides for protection against sexual harassment of women at workplace and for the prevention and redressal of complaints of sexual harassment and also for the matters incidental thereto. The Company has accordingly adopted the policy against Sexual Harassment of Women at Workplace, for the purpose of preventing, prohibiting and redressing sexual harassment of female employees at all the workplace within the Company which are based on fundamental principles of justice and fair play.
According to the notifications of corporate affairs ministry dated 31st July 2018, Internal Complaints Committee under the sexual harassment of women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, has been formed and complied with. Further, Anti Sexual Harassment Committee has been constituted at each unit which shall be responsible for redressal of complaints related to sexual harassment. The details of all such Complaints and its proper redressal through prompt corrective steps are informed to the Top Management so as to ensure that suitable processes and mechanisms are put in place to ensure that issues of sexual harassment, if any, are effectively addressed. During the year, no complaints of sexual harassment were received by the Company from any of its Units.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act read with the Companies (Accounts) Rules, 2014 are provided in the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 134(5) of the Act, the Board of Directors of the Company hereby state and confirm that;
I. In the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.
II. The Directors have selected accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review.
III. The Directors have taken proper and sufficient care for the maintenance of adequate record in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
IV. The Directors have arranged preparation of the accounts for the financial year ended 31.03.2023 on a going concern basis.
V. 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.
VI. The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Corporate Governance Report and Management Discussion and Analysis Report are attached to this Report. Certificate from the Statutory Auditors of the Company confirming the compliance with the conditions of Corporate Governance as stipulated under Schedule V of the Listing Regulation is also attached to this report.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
In pursuance of Regulation 34(2)(f) of the Listing Regulations, the Business Responsibility and Sustainability Report, containing the initiatives taken by the company from environmental, social and governance perspective, forms part of this Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The details of internal financial control and their adequacy are included in the
Report of Management Discussion & Analysis, which forms part of this report.
RATIO OF REMUNERATION TO EACH DIRECTOR
Details / Disclosures of Ratio of Remuneration of Director to the median employee''s remuneration as required by the Act and Companies Rules are appended.
SIGNIFICANT & MATERIAL ORDER PASSED BY THE REGULATORS
No significant and material order was passed by any Regulators that have any impact on the going concern status and the operations of the Company.
DETAILS REGARDING ISSUE OF SHARES
During the year under review the Company has not issued any shares.
BUYBACK
The Buyback of 22,36,000 Equity Shares mooted during the FY 2021-22 was completed on 26th April 2022. The present Paid up Capital post Buyback is ? 34.18 Crores.
AUDITORS
In the 19th Annual General Meeting of the Company held on
23.08.2022 M/s. B S R & Co LLP, Chartered Accountants (ICAI Firm Regn. No.101248W/W-100022) were re-appointed as Statutory Auditors of the Company for second term of five consecutive years from the Financial Year 2022-23.
AUDITORS REPORT
The Auditorâs Report to the Shareholders does not contain any qualification. There were no frauds reported by the Statutory Auditors under provisions of Section 143 (12) of the Companies Act, 2013 and rules made thereunder.
COST RECORDS
Pursuant to Section 148 of the Act, the company falls under the limits specified under this section and hence the company has maintained proper books of accounts with all the particulars relating to the utilization of material, labour and to other items of cost.
COST AUDIT
In pursuance of Companies (Cost Records and Audit) Rules, 2014, the Company has appointed a Cost Auditor for the Company to audit the cost records for the Financial Year 2022-23.
SECRETARIAL AUDIT REPORT & CERTIFICATES AND SECRETARIAL STANDARDS COMPLIANCE
The Company has complied with the applicable Secretarial Standards issued by ICSI. As required by the Act a Secretarial Audit Report issued by a Company Secretary in practice (PCS) a Peer Reviewed Unit in Form MR 3 is annexed with this report and it
does not contain any qualification. Certificate from PCS that none of the Directors are debarred or disqualified forms part of this Annual Report. Annual Secretarial Compliance Report certifying compliance of SEBI Regulations has been obtained and filed with the Stock Exchanges.
Pursuant to section 92 of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return in the prescribed form is available on the Company''s website: https://kprmilllimited.com/financial-result annual-reports/
DETAILS OF DEMAT/UNCLAIMED SUSPENSE ACCOUNT
The status of unclaimed shares of the Company transferred to the demat account, âK.P.R. Mill Limited - Unclaimed Shares Demat Suspense Accountâ, in accordance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is as follows:
Particulars |
No. of Shareholders |
No. of Shares |
Aggregate number of shareholders and the outstanding shares in the suspense account lying at the beginning of the year |
2 |
2750 |
Number of shareholders who approached listed entity for transfer of shares from suspense account during the year |
- |
- |
Number of shareholders to whom shares were transferred from suspense account during the year |
- |
- |
Aggregate number of shareholders and the outstanding shares in the suspense account lying at the end of the year |
2 |
2750 |
regular business and there has been no change in its objectives. GENERAL
Disclosures under sub rule 5 (xi) and (xii) of rule 8 of Companies (Accounts) Rules, 2014 are not applicable to the Company.
Your Directors acknowledge with gratitude and express their appreciation for the assistances and co-operation received from the Bankers, Government Authorities, Customers, Vendors, and Members during the year under review. Your Directors also wish to thank the employees at all levels for their co-operation and dedication.
FOR AND ON BEHALF OF THE BOARD
Coimbatore K.P. Ramasamy
03.05.2023 Chairman
DIN:00003736
The Voting rights in respect of these shares will remain frozen till the time such shares are transferred from the Unclaimed Suspense Account to the concerned Shareholders.
MATERIAL CHANGES AND COMMITMENTS
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year as on 31.03.2023 and the date of this Report.
Your Directors would like to inform that Company is doing its
Mar 31, 2022
The Board of Directors takes pleasure in presenting the report on the operations and business of the Company along with Audited Financial Statements for the Financial Year ended 31st March, 2022.
FINANCIAL RESULTS |
(7 in Lakhs) |
|||
Particulars |
Standalone |
Consolidated |
||
Sales and Other Income:- |
2021-22 |
2020-21 |
2021-22 |
2020-21 |
Domestic Sales |
2,42,442 |
1,81,428 |
2,95,811 |
2,22,382 |
Export Sales |
1,52,427 |
1,06,694 |
1,71,667 |
1,20,059 |
Other Income |
20,961 |
11,038 |
23,492 |
14,185 |
4,15,830 |
2,99,160 |
4,90,970 |
3,56,626 |
|
Profit before Interest & Depreciation |
1,06,853 |
70,235 |
1,30,593 |
86,840 |
Less: Interest |
1,339 |
1,961 |
2,329 |
3,284 |
Depreciation |
7,565 |
9,792 |
14,112 |
14,670 |
Profit Before Tax |
97,949 |
58,482 |
1,14,152 |
68,886 |
Less : Taxation:- |
||||
Provision for Current Tax |
24,870 |
15,453 |
29,706 |
17,427 |
Tax relating to earlier years |
(75) |
201 |
(53) |
259 |
24,795 |
15,654 |
29,653 |
17,686 |
|
Deferred Tax expense / Credit |
74 |
(434) |
315 |
(326) |
Profit After Tax |
73,080 |
43,262 |
84,184 |
51,526 |
Other Comprehensive Income (Net of tax) Total Comprehensive Income |
⢠|
⢠|
. |
|
73,080 |
43,262 |
84,184 |
51,526 |
REVIEW OF OPERATIONS
We are glad to report a good financial results driven by solid performance from all segments during the year under review. KPR recorded the highest ever turnover and Profit After Tax (PAT). The textile business continues to be good. The historic high demand for cotton resulted in spiraling its prices, both at domestic and the international markets due to which the yarn prices have also gone up. Irrespective of the record high prices of cotton, the demand for cotton products are also going up. Given the sharp recovery in the US and the European markets export garment orders remained healthy. The wind power generation during the year was good.
WAY FORWARD
With the Covid pandemic coming towards an end, the global economy is likely to recover and so the demand for Textile & Apparel (T&A) products is expected to be good. The Government of India is also making concerted efforts for branding of Indian T&A Industry on the global front to help Indian Companies increase
their share in the global market. It is high time for the T&A Companies to leverage the present conditions to ready themselves to adapt to the present changes to ensure their growth prospects. The FTA negotiations with major countries will also help India to get concessional duties for its textile products. We are sure that all these FTAs together when fructified, will help India gaining more access to these established markets.
COVID 19 IMPACTS
The Omicron variant has again resulted in another COVID wave not only in India but across the globe. However, its impact seems lesser as compared to earlier Covid waves, with more and more people getting vaccinated and observance of safety measures. The Government had relaxed the lockdown norms and also lifted restrictions in a phased manner to bring back normalcy. The continuous best health and safety care norms adopted by KPR has averted its impact on the operations of the Company.
The positive response to our 100% organic FASO products launched in the Southern States have enthused us to vigorously pursue its âPan India'' spread. However, the continuous spilloverof pandemic in different form for the past two years has been delaying the process. Currently FASO Products are sold through more than 3000 retail stores. Besides, its online sale is also growing steadily.
The Board in its meeting held on 27.04.2022 has recommended a Final Dividend of 15% (70.15) on Equity Shares of 71 each (Rupee One only), subject to the approval of the Members at the 19*'' (Nineteenth)Annual General Meeting.
We are happy to inform that the comfortable financial position continued during the year. We have repaid entire term loans availed and funded the new garment project and sugar cum ethanol project of our Wholly Owned Subsidiary Company.
In respect of statements pursuant to Section 129(3) of the Companies Act, 2013 (Hereinafter referred to as the ''Act'') in âForm AOC - 1â containing the details of following Wholly Owned Subsidiary Companies forms part of this Annual Report. However as required by the ''Act'', we give below a brief report on their performance.
I. QUANTUM KNITS PVT. LIMITED
II. K.P.R. SUGAR MILL LIMITED
III. KPR SUGAR AND APPARELS LIMITED
IV. JAHNVI MOTOR PRIVATE LIMITED
V. GALAXY KNITS LIMITED
VI. K P R EXPORTS PLC
VII. KPR MILL PTE. LTD.
The garment business has been consolidated for effective management. Its Board has recommended a Dividend.
K.P.R. SUGAR MILL LIMITEDSUGAR AND COGEN
The goodwill gained through honoring our payment commitments promptly ensured the sustained support from the cane growers. The sugarcane crushing commenced in October 2021, produced
1,23,893.50 MT of Sugar. The Co-gen plant produced 1,249 lakhs units of power. Out of the above, 646.75 lakhs units were sold and 601.92 lakh units captively consumed. The Central Government''s regulatory measures continues to help the Industry to perform better.
ETHANOLPLANT
The enhanced capacity of Ethanol plant (130KLPD) started accelerating the revenue. During the year 33,863 KL of Ethanol was produced, using Sugar Syrup and Molasses and the entire production was sold to Oil Marketing Companies.
Supportive Sugar prices in both the International and domestic markets, Government''s measures on increasing ethanol blending are expected to improve the earnings of the Company.
KPR SUGAR AND APPARELS LIMITED
The new 42 million Garments production capacity at Chengapally, Tirupur district, Tamil Nadu has been commissioned on 21.11.2021. Ramping up of its capacity is in progress.
The new Sugar, Cogen and Ethanol Factory at SF. No. 144/2, Chinamageri Village, Afzalpur Taluk, Kalaburagi (Gulbarga) District - 585265, Karnataka State has also been successfully commissioned with a Capacity of 10,000 TCD Sugar, 50 MW Cogen Power and 230 KLPD Ethanol. Trial production is in progress.
JAHNVI MOTOR PRIVATE LIMITED
The third covid wave have subdued the buyer sentiments thereby impacting the expected growth level in sale of automobiles as a whole. However, despite adverse market conditions, the Company could sell 88 Audi Cars and earned a total revenue of 764.11 Crores. Driven by the demand for new products and continuous demand for electric vehicle range the Audi car sales is expected to pick up in the near future.
Its Board has recommended a Dividend.
GALAXY KNITS LIMITED
The Company has not yet commenced its operation.
KPR EXPORTS PLC - ETHIOPIA
The tide of the civil war at Ethiopia had fluctuated wildly forcing its Government to declare a state of emergency there. The prevalence ot continuous social disturbance therein forced us to close its operations since revival of activities became remote. In order to take back our capital materials therein we have sought its
GovGrnmentâs support and help. We are closely monitoring the situation to take necessary steps at appropriate time.
The wholly owned Subsidiary was established at Singapore for the purpose of marketing the Products manufactured at India and Ethiopia.
The Company has not accepted any fixed deposits from public during the year under review.
The Company has adequate Independent Directors in compliance with the Act and SEBI (Listing Obligations and Disclosures Requirements) Regulation, 2015 (Hereinafter referred to as Listing Regulations). Familiarization Program on the Company and its operation was conducted for the Independent Directors. Requisite declaration from the Independent Directors of the Company under Section 149 (7) of the Act confirming that they meet with the criteria of their Independence laid in Section 149 (6) have been obtained. Mr. K.P. Ramasamy was re-appointed as the Executive Chairman of the Company for a further term of five years by passing special resolution through Postal Ballot on 21.04.2022.
Mr.P.Selvakumar, Whole-time Director, retires by rotation at the ensuing Annual General Meeting and is eligible for re-appointment.
KEY MANAGERIAL PERSONNEL AND MANAGERIAL REMUNERATION CRITERIA
In pursuance of the Act the Company has Key Managerial Personnel. None of the Managing Directors or Whole Time Directors receives any remuneration or commission from the Subsidiary Companies and the remuneration paid to them is within the purview of the provisions of Section 197 of the Act. The Company pays remuneration by way of salary, perquisites etc., to its Chairman, Managing Directors and fixed monthly remuneration to its Executive Directors and Whole Time Director in line with the approvals accorded by the General Meetings and in pursuance of the recommendation of the Nomination and Remuneration Committee as per the guiding principles laid down in the Nomination and Remuneration Policy. The information as required by Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended.
In line with the criteria evolved by the Nomination and Remuneration Committee, the performance of all Directors, Committees, Chairman etc., have been evaluated pursuant to the provisions of the Act and the Listing Regulations.
As required by the provisions of the Act and Listing Regulations, the Company has already formed the following Committees, the details of which are disclosed in the Report on Corporate Governance forming part of this Report.
I. Audit Committee
II. Stakeholders Relationship Committee
III. Nomination and Remuneration Committee
IV. Corporate Social Responsibility (CSR) Committee
V. Risk Management Committee
In pursuance of the Act and the Listing Regulation, the following policies have been framed and disclosed on the Company''s website1 www.kprmilllimited.com''
I. Nomination & Remuneration Policy
II. Related Party Transaction Policy
III. CSR Policy
IV. Whistle Blower Policy consisting of Vigil Mechanism
V. Policy on Determining Material Subsidiaries
VI. Code for Fair Disclosure
VII. Risk Management Policy
VIII. Dividend Distribution Policy
IX. Policy for Disclosure of Material Events / Information
X. Policy on Succession Planning for Board and Senior Management
Pursuant to section 134 (3) (n) of the Act & Regulation 17(9) of the Listing Regulation, the Company has a Risk Management Policy and has constituted a Risk Management Committee. The Risk Management Committee held its meetings on 27.07.2021 and
12.01.2022 in which all members were present.
VIGIL MECHANISM & WHISTLE BLOWER POLICY
The Company has an established Vigil Mechanism for Directors / Employees to report concerns about unethical behaviours, actual or suspected fraud or violation of the code of conduct or ethics policy. It also provides for adequate safeguards against victimization of Directors/Employees who avail of the mechanism. The Company affirms that no personnel have been denied access
to the Audit Committee. The Company has a Policy of Vigil Mechanism and has established a mechanism that any personnel may raise Reportable Matters. All suspected violations and Reportable Matters can be reported to the Chairman of the Audit Committee at e-mail id ''[email protected]''. The key directions/ actions can be informed to the Chairman/ Managing Director of the Company. The Whistle Blower Policy has been displayed in the company website.
During the year, in pursuance of the recommendations of the CSR committee the Company has contributed T1026.63 Lakhs (2.25% of the average three years'' net profit of the Company) towards implementing the CSR activities. Annual Report on CSR, as required by the Act, is appended.
The Board of Directors met Five times during the financial year on
28.04.2021,27.07.2021,27.10.2021,07.02.2022 and 14.03.2022. The Composition of Board, procedure, dates and other details are included in the Corporate Governance Report that forms part of this Report.
CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in annexing the Consolidated Financial Statements pursuant to the provisions of the ''Act'' and the Listing Regulations entered into with the Stock Exchanges. They are prepared in accordance with the Ind-AS prescribed by the Institute of Chartered Accountants of India, in this regard. The Consolidated Financials also marked a significant increase in its Revenue as well as Profitability.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has duly complied with the provisions of Section 186 of the Act and as required therein the details of the Borrowals, Security, Investment etc., are annexed by way of notes to accounts.
All Related Party Transactions that were entered into during the financial year were only between Holding Company and Wholly owned Subsidiary Companies in the ordinary course of business, whose accounts are consolidated with Holding Company and placed before the shareholders at the General Meeting for approval. However, as per regulatory requirements an omnibus approval of the audit committee for such transactions has been obtained.
The Transactions as required under Indian Accounting Standards AS-24 are reported in Note 39 of the Notes to Accounts of the Standalone Financial Statements as well as Note 39 of the Notes to Accounts of the Consolidated Financial Statements of your Company. The Company''s Policy on dealing with related party transactions is available on the Company''s website.
Realizing that the Education and employment are the two basic tools which can change the economic and social status of woman, KPR continues to concentrate on mobilizing women work force from the rural villages and empower them with the employment as well as higher education. 90% of our Employees are woman who get value addition through KPRâs outstanding employee welfare schemes. The pandemic conditions could not deter our dedicated efforts in upgrading their educational qualifications. So far over 31,000 employees are benefitted by the higher education and vocational training facilities. During the year also, the unique placement scheme extended by the Company enabled 174 employees to get placement in other reputed Companies in the on-campus selection conducted by them underour initiative.
The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and others entitled thereto, excluding the information on employees'' particulars which is available for inspection by the members at the Registered Office of the Company during business hours on working days of the Company up to the date of ensuing Annual General Meeting. If any member is interested in inspecting the same, such member may write to the Company Secretary in advance.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 provides for protection against sexual harassment of women at workplace and for the prevention and redressal of complaints of sexual harassment and also for the matters incidental thereto. The Company has accordingly adopted the policy against Sexual Harassment of Women at Workplace, for the purpose of preventing, prohibiting and redressing sexual harassment of female employees at all the workplace within the Company which are based on fundamental principles of justice and fair play.
According to the notifications of corporate affairs ministry dated 31st July 2018, Internal Complaints Committee under the sexual harassment of women at Workplace (Prevention, Prohibition and Redressal) Act 2013, has been formed and complied with. Further, Anti Sexual Harassment Committee has been constituted at each unit which shall be responsible for redressal of complaints related to sexual harassment. The details of all such Complaints and its proper redressal through prompt corrective steps are informed to the Top Management so as to ensure that suitable processes and mechanisms are put in place to ensure that issues of sexual harassment, if any, are effectively addressed. During the year, no complaints of sexual harassment were received by the Company from any of its Units.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act read with the Companies (Accounts) Rules, 2014 are provided in the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 134(5) of the Act, the Board of Directors of the Company hereby state and confirm that;
I. In the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.
II. The Directors have selected accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review.
III. The Directors have taken proper and sufficient care for the maintenance of adequate record in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
IV. The Directors have arranged preparation of the accounts for the financial year ended 31.03.2022 on a going concern basis.
V. The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.
VI. 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 REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Corporate Governance Report and Management Discussion and Analysis Report are attached to this Report. Certificate from the Statutory Auditors of the Company confirming the compliance with the conditions of Corporate Governance as stipulated under Schedule V of the Listing Regulation is also attached to this report. BUSINESS RESPONSIBILITY REPORT In pursuance of Regulation 34(2)(6) of the Listing Regulations, the Business Responsibility Report, containing the initiatives taken by the company from environmental, social and governance perspective, forms part of this Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The details of internal financial control and their adequacy are included in the Report of Management Discussion & Analysis, which forms part of this report.
RATIO OF REMUNERATION TO EACH DIRECTOR
Details / Disclosures of Ratio of Remuneration of Director to the median employeeâs remuneration as required by the Act and Companies Rules are appended.
SIGNIFICANT & MATERIAL ORDER PASSED BY THE REGULATORS
No significant and material order was passed by any Regulators that have any impact on the going concern status and the operations of the Company.
DETAILS REGARDING ISSUE OF SHARES
During the year under review the Company has not issued any shares. However, the Company has sub-divided its Equity shares and resorted to Buyback of shares as explained below. SUB-DIVISION OF EQUITY SHARE (SPLIT OF SHARE)
After obtaining the consent of the Members of the Company in the 18th AGM and complying with the applicable provisions of the Act and Regulations, the Equity Shares of the Company of the Face value of /- each has been split into 5 equity shares of Face value of T1/- each during September 2021. The new ISIN of the Company is INE930H01031.
The Board of Directors of the Company resorted to a Buyback of 22,36,000 fully paid-up equity shares (0.65% of the pre Buyback equity share capital) of the face value of XV- each from all the existing shareholders on a proportionate basis, through the "Tender Route" process at a price of ?805/- per Equity Share payable in cash. The total consideration amounted to ?179.99 Crores representing 9.53% and 7.73% of the aggregate of the fully paid-up equity share capital and free reserves, as per the audited accounts of the Company for the year ended March 31, 2021. After complying with the applicable laws, the Company bought back 22,36,000 Equity Shares. The funds in respect of accepted Equity Shares have been paid out. Buyback was completed on 26m April 2022. The present paid up Capital post Buyback is T34.18 Crores.
In the 14"1 Annual General Meeting of the Company held on 28.08.2017 M/s. B S R & Co LLP, Chartered Accountants (ICAI Firm Regn. No.101248WAA/-100022) were appointed as Statutory Auditors of the Company for a period of five Years from the Financial Year 2017 - 18. The Audit committee and the Board recommends the continuity of BSR & Co LLP, Chartered Accountants as Statutory Auditors for the second term of five consecutive years from FY 2022-23.
The Auditorâs Report to the Shareholders does not contain any qualification.
Pursuant to Section 148 of the Act, the company falls under the limits specified under this section and hence the company has maintained proper books of accounts with all the particulars relating to the utilization of material, labour and to other items of cost.
In pursuance of Companies (Cost Records and Audit) Rules, 2014, the Company has appointed a Cost Auditor for the Company to audit the cost records for the Financial Year 2021-22.
SECRETARIAL AUDIT REPORT & CERTIFICATES AND SECRETARIAL STANDARDS COMPLIANCE
The Company has complied with the applicable Secretarial Standards issued by ICSI. As required by the Act a Secretarial Audit Report issued by a Company Secretary in practice (PCS) a Peer Reviewed Unit in Form MR 3 is annexed with this report and it does not contain any qualification. Certificate from PCS that none of the Directors are debarred or disqualified forms part of this Annual Report.
Annual Secretarial Compliance Report certifying compliance of SEBI Regulations has been obtained and filed with the Stock Exchanges.
Pursuant to section 92 of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return in the prescribed form is available on the company''s website: https://kprmilllimited.com/financial-result_annual-reports/
MATERIALCHANGES AND COMMITMENTS
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year as on 31.03.2022 and the date of this Report. Only the Buyback of shares commenced in FY 2021-22 has been completed on 26.04.2022
Your Directors would like to inform that Company is doing its regular business and there has been no change in its objectives.
Your Directors acknowledge with gratitude and express their appreciation for the assistances and co-operation received from ⢠the Bankers, Government Authorities, Customers, Vendors, and Members during the year under review. Your Directors also wish to thank the employees at all levels for their co-operation and dedication.
FOR AND ON BEHALF OF THE BOARD K.P. Ramasamy
Coimbatore Chairman
27.04.2022 DIN: 00003736
Mar 31, 2021
The Board of Directors'' take pleasure in presenting the report on the operations and business of the Company along with Audited Financial Statements for the Financial Year ended 31st March, 2021.
FINANCIAL RESULTS |
(7 in Lakhs) |
|||
Particulars |
Standalone |
Consolidated |
||
2020-21 |
2019-20 |
2020-21 |
2019-20 |
|
Sales and Other Income:- |
||||
Domestic Sales |
1,81,428 |
1,61,954 |
2,22,655 |
1,85,795 |
Export Sales |
1,06,694 |
1,18,246 |
1,20,059 |
1,34,781 |
Other Income |
11,038 |
13,253 |
14,185 |
18,333 |
2,99,160 |
2,93,453 |
3,56,899 |
3,38,909 |
|
Profit before Interest & Depreciation |
70,235 |
51,099 |
86,840 |
65,841 |
Less: Interest |
1,961 |
3,541 |
3,284 |
4,965 |
Depreciation |
9,792 |
9,891 |
14,670 |
13,709 |
Profit Before Tax |
58,482 |
37667 |
68,886 |
47167 |
Less: Taxation:- |
||||
Provision for Current Tax |
15,453 |
10,084 |
17,427 |
11,850 |
Tax relating to earlier years |
201 |
(944) |
259 |
(927) |
15,654 |
9,140 |
17,686 |
10,923 |
|
Deferred Tax expense / Credit |
(434) |
(934) |
(326) |
(1,424) |
Profit After Tax |
43,262 |
29,461 |
51,526 |
37668 |
Other Comprehensive Income (Net of tax) |
⢠|
|||
Total Comprehensive Income |
43,262 |
29,461 |
51,526 |
37668 |
KPR reported a good results in the year under review also with the encouraging demand from all segments. The Cotton prices remained stable for most part of the year, yam market was bullish and garment order levels were also comfortable. The garment orders started bouncing back from the vaccum caused by the pandemic. The Industry witnessed a significant shift in demand from formal wear to casual wear. Since KPR is primarily in the casual wear segment the trend continues to be more favorable to us. The consequential thrust in demand for yam, fabric and processing activities have accelerated the drive in Tirupur Knitwear Market. KPR''s trendsetter welfare facilities and the dedicated employees'' participation enhanced the productivity even during the COVID time ensuring KPR''s outstanding ability and sustained competitiveness.
Proving its strong fundamentals and leadership, KPR was able to withstand all hurdles during this tough time by delivering good performance. The recently added latest technology vortex
machine produces various blends and range of value added viscose yam that creates new wave of old fashion. KPR is largely engaged in manufacturing cotton products, and of course the market is slowly moving into value added manmade fiber also. So as to meet the demand from the Customers we have installed the vortex machine. The establishment of a new advanced technology knitting facility housing the contemporary imported knitting machines would add value to the production facilities. The additional Garment capacity envisaged would also add up to the Revenue. However putting a spoke in the wheel of Nation''s progress the second wave of the pandemic has started surging and the lock down restrictions are also re-introduced. We have to wait and watch its impact on the economy carefully.
The entire world was passing through uncertainty that was never seen before due to COVID-19 pandemic. Like, many other sectors of the economy textile industry have been hit hard by closing down its business. During this challenging time, our priority was the well-being of all of us. Our focus was to support the government''s public health initiative and instructions regarding social distancing.
In compliance with the statutory lockdown directions, the operations of the Company was suspended for more than a month, and that was from 24.0B.2020. Lockdown was extended by the Tamil Nadu government up to 03.05.2020, effective from 06.05.2020 the operations commenced partially with restricted work force as per the government guidelines. Operations were ramped up gradually with all necessary safety precautions for the employees and KPR remained operational, and continue to serve all stakeholders. Due to COVID, almost all manufacturing companies faced the issue of migrated labor in entire countiy returning all to their hometowns causing severe labor shortage. Whereas in KPR it was different. KPR never faced such an issue at all, even during that challenging time. Thanks to its unique, and best HR practices. The industiy acclaimed HR policy adopted by the management since beginning rewarded KPR during this crisis period. The feel at home facility at KPR encouraged migrated workers to stay back enjoying the continued comfortable accommodation provided by KPR with nutritious food, recreation, education facilities and safety measures. Our executives and employees had successfully repositioned to ensure that our work progresses. In addition, admiring our genuine approach and positive attitude all the customers and stakeholders supported and stood with us during the critical time. We want to thank them all for their dedicated and continued support.
The second wave of the pandemic has started spreading all over the world and the Nation. Though the vaccines are being administered, we have to wait and watch the situation carefully to ascertain its impact on the business.
Entire FASO products are manufactured with 100% Organic Cotton, super fine compact yarn, super soft micro nylon elastics with the best workmanship. These key factors ensure ultra-soft comfort and skin friendly. Currently offering 43 styles, mix of inner wear & athleisure and planning to add some more styles during the current year. FASO is now available in all major locations of Tamil Nadu, Kerala, Andhra Pradesh, Telangana and Karnataka (34 distributors and 2000 retailers). It is also available in some of the Hyper Market and through online in Amazon, Myntra, Ajio, Flipkart, Shoppers stop (online), Fynd & faso.in. The market response is good. We are planning to widen its reach gradually. Its launch in North East market is planned during the second Quarter
of FY 2021-22, subject to prevailing COVID Pandemic Regulations and restrictions.
The Interim Dividend @ 75% on equity shares (? 3.75/- per Equity Share) declared by the Board of Directors at their meeting held on 03.02.2021 was paid to the shareholders.
The Board in its meeting held on 28.04.2021 has recommended a Final Dividend of 15% (? 0.75) on Equity Shares of ? 5 each (Rupees Five only), subject to the approval of the Members at the IS"1 (Eighteenth) Annual General Meeting.
During the year under review the Company has not transferred any amount to its General Reserve.
We are glad to share with you that the strong fundamentals, sustained team efforts, and prudential financial management enabled comfortable liquidity position even during the COVID-19 pandemic. As such, KPR neither availed any moratorium nor any COVID Loan announced by the Government during and after Covid lockdown period. In fact, we have even repaid some of the high cost long term debt thereby reducing the Finance cost.
In respect of statements pursuant to Section 129(3) of the Companies Act, 2013 (Hereinafter referred to as the ''Act'') in ''Form AOC - 1'' containing the details of following Wholly Owned Subsidiary Companies forms part of this Annual Report. However as required by the ''Act'', we give below a brief report on their performance.
I. QUANTUM KNITS PVT. LIMITED
II. K.P.R. SUGAR MILL LIMITED
III. JAHNVI MOTOR PRIVATE LIMITED
IV. GALAXY KNITS LIMITED
V. KPRSUGARAND APPARELS LIMITED
VI. KPR EXPORTS PLC
VII. KPR MILL PTE. LTD.
The garment business has been consolidated for effective management.
Considering the prospects the Sugar Plant''s Crushing capacity has been increased from 5000 TCD to 10000 TCD during the year. We are happy to inform that our prompt payment practice has earned a reputation among the cane growers and we continue to enjoy their support. In the FY 2020-21 the sugarcane crushing commenced in November 2020 and produced 85,423.10 MT of sugar. Out of 1,028.79 Lakh units of power generated 600.13 Lakh units were sold and 428.66 lakh units captively consumed. The monthly sugar sales quota system introduced by the Central Government to the Sugar Mills fixing the quantity as well as the price at which sugar can be sold every month continues. During the year we have exported 21,279 MT of Sugar.
The ''State of the Alt'' Ethanol plant with 90 KLPD capacity commissioned during the last year has been adding to the revenue of the Company. During the year 23,373 KL of Ethanol was produced, using Sugar Syrup and Molasses. 23,600 KL was sold to oil marketing Companies. Enthused by huge potential and positive outlook for ethanol production in India, its production capacity has been increased to 130 KLPD and 6 MW Co gen with Incineration Boiler.
These expansions will further increase the value addition and the revenue of the Company.
The outbreak of COVID-19 pandemic has impacted the sale of Automobile manufacturers across the countiy as the supply chain was widely disturbed and customers were forced to stay indoor due to the nation-wide lockdown imposed by the government. Despite these adverse factors the Company could sell 51 Audi Cars and 31 Harley Davidson Motor cycles earning a total revenue of ? 50.47 Crores. Consequent on the closure of production activities by Harley Davidson in India its Dealership has been discontinued.
The Company has not yet commenced its operation.
KPR SUGAR AND APPARELS LIMITED
Sensing huge potential and positive outlook, it was decided to increase the manufacturing capacities in Garment and Sugar cum
Ethanol segments. To facilitate the same a separate wholly owned Subsidiary under the name ''KPR Sugar and Apparels Limited'' (KPRSAL) was promoted holding its entire equity stake with us. We have nominated our Directors therein and controlling its entire Board. KPRSAL is setting up a new Garment manufacturing unit at Chengappally, Tirupur District, Tamilnadu with a capacity to produce 42 million Garments per annum. A Memorandum of Understanding has been entered into with the Government of Tamilnadu that may facilitate infrastructures and regulatory requirements. KPRSAL is also setting up a Sugar, Co-Gen-cum-ethanol plant with a capacity to produce 10,000 TCD Sugar, 220 KLPD Ethanol and 50 MW Co-gen at Gulbargah District, Karnataka. The Single window approval from the Government of Karnataka in respect of the said Project has also been obtained. These new moves are expected to increase the value addition and thereby enhance the revenue of the Group as a whole.
Responding to the invitation from Ethiopia Investment Commission (EIC) and upon the request and assurances from its Government to render all assistance and support we had set up an Apparel manufacturing unit under the name ''KPR Exports PLC'' at Mekelle Industrial Park, Mekelle, Tigray Region, Ethiopia, during 2018. Erecting required machinery and equipment and engaging workers after training them at our manufacturing unit in India, we have been producing and exporting Apparels since 2018. While things were smooth till October 2020, suddenly due to emergence of some ethnic conflict resulting in riot and tension near Mekelle, Tigray Region, entire activities in the said Industrial Park became standstill. Like other textile Companies established therein, we also had to shut down our entire activities and the workers had to be pulled out to safety places considering their safety and security. We are closely monitoring the situation and appropriate steps will betaken based on the developments.
During the year the Company has earned a revenue of ? 393 Lakhs.
The wholly owned Subsidiary established at Singapore for the purpose of marketing the Products manufactured at Ethiopia has generated a revenue of ? 1,197 Lakhs during the year.
The Company has not accepted any fixed deposits from public during the year under review.
The Company has adequate Independent Directors in compliance with the Act and SEBI (Listing Obligations and Disclosures Requirements) Regulation, 2013 (Hereinafter reffered to as Listing Regulations). Familiarization Program on the Company and its operation was conducted for the Independent Directors. Requisite declaration from the Independent Directors of the Company under Section 149 (7) of the Act confirming that they meet with the criteria of their Independence laid in Section 149 (6) have been obtained.
Mr. E.K. Sakthivel, Executive Director, who retires by rotation at the ensuing Annual General Meeting and is eligible for re-appointment.
KEY MANAGERIAL PERSONNEL AND MANAGERIAL REMUNERATION CRITERIA
In pursuance of the Act the Company has Key Managerial Personnel. None of the Managing Directors or Whole Time Directors receives any remuneration or commission from the Subsidiary Companies and the remuneration paid to them is within the purview of the provisions of Section 197 of the Act. The Company pays remuneration byway of salary, perquisites etc., to its Chairman, Managing Directors and fixed monthly remuneration to its Executive Directors and Whole Time Director in line with the approvals accorded by the General Meetings and in pursuance of the recommendation of the Nomination and Remuneration Committee as per the guiding principles laid down in the Nomination and Remuneration Policy. The information as required by Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended.
In line with the criteria evolved by the Nomination and Remuneration Committee, the performance of all Directors, Committees, Chairman etc., have been evaluated pursuant to the provisions of the Act and the Listing Regulations.
As required by the provisions of the Act and Listing Regulations, the Company has already formed the following Committees, the details of which are disclosed in the Report on Corporate Governance forming part of this Report.
I. Audit Committee
II. Stakeholders Relationship Committee
III. Nomination and Remuneration Committee
IV. Corporate Social Responsibility (CSR) Committee
V. Risk Management Committee
In pursuance of the Act and the Listing Regulation, the following policies have been framed and disclosed on the Company''s website ''www.kprmilllimited.com''
I. Nomination & Remuneration Policy
II. Related Party Transaction Policy
III. CSR Policy
IV. Whistle Blower Policy consisting of Vigil Mechanism
V. Policy on Determining Material Subsidiaries
VI. Code for Fair Disclosure
VII. Risk Management Policy
VIII. Dividend Distribution Policy
IX. Policy for Disclosure of Material Events / Information
X. Policy on Succession Planning for Board and Senior Management
Pursuant to section 134 (3) (n) of the Act & Regulation 17(9) of the Listing Regulation, the Company has framed a Risk Management Policy and has constituted a risk management committee. The Risk Management Committee held its meeting on 24.03.2021 in which all members were present.
VIGIL MECHANISM & WHISTLE BLOWER POLICY
The Company has an established Vigil Mechanism for Directors / Employees to report concerns about unethical behaviours, actual or suspected fraud or violation of the code of conduct or ethics policy. It also provides for adequate safeguards against victimization of Directors/Employees who avail of the mechanism. The Company affirms that no personnel have been denied access to the Audit Committee. The Company has formulated a Policy of Vigil Mechanism and has established a mechanism that any personnel may raise Reportable Matters. All suspected violations and Reportable Matters can be reported to the Chairman of the Audit Committee at e-mail id ,[email protected]>. The key directions/ actions can be informed to the Chairman/ Managing Director of the Company. The Whistle Blower Policy has been framed and displayed in the company website.
During the year, in pursuance of the recommendations of the CSR committee the Company has contributed ? 730.02 Lakhs being
2% of the average three years net profit of the Company towards implementing the CSR activities. Annual Report on CSR, as required by the Act, is appended.
The Board of Directors met Five times during the financial year on
27.06.2020, 12.08.2020, 24.09.2020, 27.10.2020 and
03.02.2021. The Composition of Board, procedure, dates and other details are included in the Corporate Governance Report that forms part of this Report.
CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in annexing the Consolidated Financial Statements pursuant to the provisions of the ''Act'' and the Listing Regulations entered into with the Stock Exchanges. They are prepared in accordance with the Ind-AS prescribed by the Institute of Chartered Accountants of India, in this regard. The Consolidated Financials also marked a significant increase in its Revenue as well as Profitability.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has duly complied with the provisions of Section 186 of the Act and as required therein the details of the Borrowals, Security, Investment etc., are annexed by way of notes to accounts.
All Related Party Transactions that were entered into during the financial year were only between Holding Company and Wholly owned Subsidiary Companies in the ordinaiy course of business, whose accounts are consolidated with Holding Company and placed before the shareholders at the General Meeting for approval.
The Transactions as required under Indian Accounting Standards AS-24 are reported in Note 39 of the Notes to Accounts of the Standalone Financial Statements as well as Note 38 of the Notes to Accounts of the Consolidated Financial Statements of your Company. The Company''s Policy on dealing with related party transactions is available on the Company''s website.
KPR always believes that the work environments need to be healthy, employee-friendly and their entire basic needs and tools should be present at the workplace to enhance the employees''
satisfaction and performance. Through its commendable labour practices followed over the years, KPR continues to enjoy the sustained support from its workforce even during the pandemic times also. That is the strength of KPR, built over a period of time. We are proud to declare that almost all the migrant workers employed at KPR; that is in thousands, stayed back in our factory premises itself disregarding the urge to move to native places during pandemic. Not only that, but their dedicated participation has enhanced the productivity even during the Pandemic time. Our ability to attract and retain the best and the well trained employees even during difficult period ensure competitive advantage over our peer groups'' effectiveness and sustained competitiveness. At this juncture, we wish to thank all those who have communicated their commendations through various media for the ''employee caring'' attitude of KPR during the pandemic. There were several messages, phone calls, appreciations, not only within the industry but from the people of all walks of life hailing KPR as the ''Management with human touch''.
As regards Higher Education to Employees, adding feather in the cap of our efforts to uplift their values, around 45 Employees got placement in the on-campus selection conducted by some of the eminent entities under our intiative.
The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and others entitled thereto, excluding the information on employees'' particulars which is available for inspection by the members at the Registered Office of the Company during business hours on working days of the Company up to the date of ensuing Annual General Meeting. If any member is interested in inspecting the same, such member may write to the Company Secretary in advance.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 provides for protection against sexual harassment of women at workplace and for the prevention and redressal of complaints of sexual harassment and also for the matters incidental thereto. The Company has
accordingly adopted the policy against Sexual Harassment of Women at Workplace, for the purpose of preventing, prohibiting and redressing sexual harassment of female employees at all the workplace within the Company which are based on fundamental principles of justice and fair play.
According to the notifications of corporate affairs ministry dated 31st July 2018, Internal Complaints Committee under the sexual harassment of women at workplace (prevention, prohibition and redressal act) 2013, has been formed and complied with. Further, Anti Sexual Harassment Committee has been constituted at each unit which shall be responsible for redressal of complaints related to sexual harassment. The details of all such Complaints and its proper redressal through prompt corrective steps are informed to the Top Management so as to ensure that suitable processes and mechanisms are put in place to ensure that issues of sexual harassment, if any, are effectively addressed. During the year, no complaints of sexual harassment were received by the Company from any of its Units.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act read with the Companies (Accounts) Rules, 2014 are provided in the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 134(5) of the Act, the Board of Directors of the Company hereby state and confirm that;
I. In the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.
II. The Directors have selected accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review.
III. The Directors have taken proper and sufficient care for the maintenance of adequate record in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
IV. The Directors have arranged preparation of the accounts for the financial year ended 31.03.2021 on a going concern basis.
V. The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.
VI. 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 REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Corporate Governance Report and Management Discussion and Analysis Report are attached to this Report. Certificate from the Statutory Auditors of the Company confirming the compliance with the conditions of Corporate Governance as stipulated under Schedule V of the Listing Regulation is also attached to this report.
BUSINESS RESPONSIBILITY REPORT
In pursuance of Regulation 34(2)(6) of the Listing Regulations, the Business Responsibility Report, containing the initiatives taken by the company from environmental, social and governance perspective, forms part of this Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The details of internal financial control and their adequacy are included in the Report of Management Discussion & Analysis, which forms part of this report.
RATIO OF REMUNERATION TO EACH DIRECTOR
Details / Disclosures of Ratio of Remuneration of Director to the median employee''s remuneration as required by the Act and Companies Rules are appended.
SIGNIFICANT & MATERIAL ORDER PASSED BY THE REGULATORS
No significant and material order was passed by any Regulators that have any impact on the going concern status and the operations of the Company.
DETAILS REGARDING ISSUE OF SHARES
The Company has not issued any new shares during the year and the paid up Capital of the Company remains at ? 34,40,50,000 consisting of 6,88,10,000 Equity Shares of? 5/- each.
In the 14th Annual General Meeting of the Company held on 28.08.2017 M/s. B S R & Co LLP, Chartered Accountants (ICAI Firm Regn. No. 101248W/W-100022) were appointed as Statutoiy Auditors of the Company for a period of 5 Years from the Financial Year 2017 - 18. The Audit committee and the Board recommend the continuity of BSR & Co LLP, Chartered Accountants as Statutoiy Auditors for the FY 2021-22.
The Auditor''s Report to the Shareholders does not contain any qualification.
Pursuant to Section 148 of the Act, the company falls under the limits specified under this section and hence the company has maintained proper books of accounts with all the particulars relating to the utilization of material, labour and to other items of cost.
In pursuance of Companies (Cost Records and Audit) Rules, 2014, the Company has appointed a Cost Auditor for the Company to audit the cost records for the Financial Year 2020-21.
SECRETARIAL AUDIT REPORT & CERTIFICATES AND SECRETARIAL STANDARDS COMPLIANCE
The Company has complied with the applicable Secretarial Standards issued by ICSI. As required by the Act a Secretarial Audit Report issued by a Company Secretaiy in practice (PCS) a Peer Reviewed unit in Form MR 3 is annexed with this report and it does not contain any qualification. Certificate from PCS that none of the Directors are debarred or disqualified forms part of this Annual Report.
Annual Secretarial Compliance Report certifying compliance of SEBI Regulations has been obtained and filed with the Stock Exchanges.
Pursuant to section 92(3) of the Act and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of annual return in MGT 9 has been uploaded in the Company''s website: https://kprmilllimited.com/financial-result_annual-reports/
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year as on 31.03.2021 and the date of this Report.
Your Directors would like to inform that Company is doing its regular business and there has been no change in its objectives.
Your Directors acknowledge with gratitude and express their appreciation for the assistances and co-operation received from the Bankers, Government Authorities, Customers, Vendors, and Members during the year under review. Your Directors also wish to thank the employees at all levels for their co-operation and dedication.
FOR AND ON BEHALF OF THE BOARD K.P. Ramasamy
Coimbatore Chairman
28.04.2021 DIN: 00003736
Mar 31, 2018
Dear Members,
The Board of Directorsâ take pleasure in presenting the report on the operations and business of the Company along with Audited Financial Statements for the Financial Year ended 31st March, 2018.
FINANCIAL RESULTS (Rs. in Lakhs)
Particulars |
Standalone |
Consolidated |
||
Sales and Other Income:- |
2017-18 |
2016-17 |
2017-18 |
2016-17 |
Domestic Sales |
1,66,045 |
1,52,162 |
1,74,661 |
1,69,259 |
Export Sales |
77,255 |
64,200 |
1,14,104 |
1,01,395 |
Other Income |
9,359 |
8,264 |
15,097 |
13,755 |
2,52,659 |
2,24,626 |
3,03,862 |
2,84,409 |
|
Profit before Interest & Depreciation |
44,502 |
47277 |
58,943 |
59,074 |
Less: Interest |
3,049 |
4,503 |
5,156 |
6,445 |
Depreciation |
10,497 |
11,743 |
13,985 |
14,939 |
Profit Before Tax |
||||
30,956 |
31,031 |
39,802 |
37690 |
|
Less: Taxation:- |
||||
Provision for Current Tax |
8,050 |
7,668 |
10,094 |
9,119 |
Tax relating to earlier years |
213 |
(166) |
232 |
(159) |
Less : MAT Credit Entitlement |
28 |
1,420 |
||
8,263 |
7,502 |
10,298 |
7540 |
|
Deferred Tax expense / Credit |
196 |
(313) |
466 |
1,468 |
Profit After Tax |
22,497 |
23,842 |
29,038 |
28,682 |
Other Comprehensive Income (Net of tax) |
30 |
15 |
30 |
15 |
Total Comprehensive Income |
22,527 |
23,857 |
29,068 |
28,697 |
REVIEW OF OPERATIONS
Despite the difficult market scenario caused by the GST the Companyâs performance has been good. The enhanced capacity in Garment and Processing has started contributing to the performance and its full fledged performance can be expected from the current year onwards. We are happy to inform that the Garment revenue has crossed Rs. 1000 Crores and the consolidated revenue has crossed Rs. 3000 Crores. The Standalone revenue has recorded 12% growth over previous year. The availability of power in the State continues to be comfortable. Though the Industiy has been facing labour shortage we are able to mobilize the required workforce due to commendable labour welfare practices followed by the Company.
PROPOSAL FOR NEW APPAREL UNIT AT ETHIOPIA
We are glad to announce the proposal for our maiden investment abroad. In response to the invitation extended by the Government of Ethiopia for setting up of Apparel manufacturing Unit in Ethiopia offering various incentives and concessions and considering the lucrative advantages, it is proposed to set up an Apparel Manufacturing Unit at Mekelle Industrial Park promoted by Ethiopian Investment Commission. We are planning to incorporate a separate Subsidiary Company at Ethiopia to establish and run the said Apparel unit. We have visited the place and initial discussions with the Authorities are in progress.
FUTURE OUTLOOK
With the Textile Industiy settling in to the GST regime gradually, it is expected that the initial glitches might be sorted out during the current year. The cotton prices are expected to remain firm, domestic demand for cotton yarn has started showing signs of restoration with most of the headwinds witnessed during the GST transition and changes in export incentive structure subsiding. The continuous support from the International Buyers is much encouraging and with the stable outlook for cotton for fiscal 2018-19, the margins may expand due to softening in cotton prices, better consumer spending outlook. Maiden initiatives towards exploring the new avenues to strengthen the Growth prospects are in place. We hope that the inherent key strengths and prospective initiatives shall further intensify our growth prospects.
BUYBACK
The Board of Directors of the Company announced a Buyback of 13,35,000 fully paid-up equity shares (1.81% of the pre Buyback equity share capital) of the face value of Rs. 5/- each from all the existing shareholders on a proportionate basis, through the âTender Routeâ process at a price of Rs. 810 per Equity Share payable in cash. The total consideration amounted to Rs. 108.14 Crores representing 9.81% of the aggregate of the paid-up equity share capital and free reserves, as per the audited accounts of the Company for the year ended March 31,2017. After complying with the applicable laws, the Company bought back 13,35,000 Equity Shares. The funds in respect of accepted Equity Shares have been paid out. Buyback was completed on 13th April, 2018. The Promoters who have participated in the Buyback offer re-organized their stake to the permitted levels subsequently as per their undertaking to SEBI. The present Paid up Capital Post Buyback is Rs. 36.28 Crores.
DIVIDEND
The Board in its meeting held on 30.04.2018 has recommended a Dividend of 15% on Equity Shares of Rs. 5 each (Rs. 0.75), subject to the approval of the Members at the Fifteenth Annual General Meeting.
RESERVES
During the year under review the Company has transferred Rs. 1,126 Lakhs to the General Resen/e.
FINANCE
Our prompt repayments of loan and interest continued. The funds are effectively managed to reduce the cost of interest. During the year, we have availed additional term loans to fund the expansion Projects. The comfortable cash position is expected to continue with the prospective outlook.
SUBSIDIARY COMPANIES
In respect of statements pursuant to Section 129(3) of the Companies Act, 2013 (Hereinafter referred to as the âActO in âForm AOC - 1â containing the details of following Wholly Owned Subsidiary Companies forms part of this Annual Report. However as required by the âActâ, we give below a brief report on their performance.
I. QUANTUM KNITS PVT. LIMITED
II. K.P.R SUGAR MILL LIMITED
III. jAHNVI MOTOR PRIVATE LIMITED
IV. GALAXY KNITS LIMITED
QUANTUM KNITS PVT LIMITED
The garment business has been consolidated for effective management.
KP.R SUGAR MILL LIMITED
Higher sugar cane output and yield pegged the sugar production of the Countiy for the year 2017-18. The sugarcane crushing commenced in November 2017 could produce 88,136 MT of sugar as against 32,995 MT of last year. Out of 857 Lakh units of power generated 596 Lakh units were sold and 261 Lakh units captively consumed.
JAHNVI MOTOR PRIVATE LIMITED
Though the year started with the recoveiy from the impact of demonetisation, the GST challenges and changes to tax rates on luxury Cars have lead to a slow growth. During the year the Company booked a revenue of Rs. 92.60 Crores. Itâs performance is expected to be stable in the current year.
GAIAXY KNITS UMITED
The Company has not yet commenced its operation.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from public during the year under review.
DIRECTORS
The Company has adequate Independent Directors in compliance with the Act and Listing Regulations. Familiarization Program on the Company and its operation was conducted for the Independent Directors. Requisite declaration from the Independent Directors of the Company under Section 149 (7) of the Act confirming that they meet with the criteria of their Independence laid in Section 149 (6) have been obtained. As the 5 years term of the Independent Directors viz, Mr. KNV. Ramani, Dr. K. Sabapathy, Mr. G.P. Muniappan, Mr. A.M. Palanisamy, Mr. C. Thirumurthy appointed in the 11th AGM will be over by 31st March 2019, suitable Special Resolutions for their re-appointment for a further term of 5 years have been included in the notice of the ensuing AGM. The Nomination & Remuneration Committee and the Board recommend their re-appointment.
Mr. E.K. Sakthivel, Director, retires by rotation at the ensuing Annual General Meeting and is eligible for re-appointment. The details of the aforesaid Directors, required to be disclosed under Regulation 36(3) of the Listing Regulation, form part of the Notice of the ensuing Annual General Meeting. Your Directors recommend his re-appointment. All the Directors of the Company have confirmed that they are not disqualified from being appointed as Directors in terms of Section 164 (2) of the Act.
KEY MANAGERIAL PERSONNEL AND MANAGERIAL REMUNERATION CRITERIA
In pursuance of the Act the Company has Key Managerial Personnel. None of the Managing Directors or Whole Time Directors receives any remuneration or commission from the Subsidiary Companies and the remuneration paid to them is within the purview of the provisions of Section 197 of the Act. The Company pays remuneration by way of salary, perquisites etc., to its Chairman, Managing Directors and fixed monthly remuneration to its Executive Directors and Whole Time Director in line with the approvals accorded by the General Meetings in pursuance of the recommendation of the Nomination and Remuneration Committee as per the guiding principles laid down in the Nomination and Remuneration Policy. The information as required by Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended.
ANNUAL PERFORMANCE EVALUATION
In line with the criteria evolved by the Nomination and Remuneration Committee, the performance of all Directors, Committees, Chairman etc., have been evaluated pursuant to the provisions of the Act and the Listing Regulations.
COMMITTEES
As required by the provisions of the Act and Listing Regulation, the Company has already formed the following Committees, the details of which are disclosed in the Report on Corporate Governance forming part of this Report.
I. Audit Committee
II. Stake Holders Relationship Committee
III. Nomination and Remuneration Committee
IV. Corporate Social Responsibility (CSR) Committee
POLICIES
In pursuance of the Act and the Listing Regulation, the following policies have been framed and disclosed on the Companyâs website âwww.kprmilllimited.comâ
I. Nomination & Remuneration Policy
II. Related Party Transaction Policy
III. CSR Policy
IV. Whistle Blower Policy consisting of Vigil Mechanism
V. Policy on Determining Material Subsidiaries
VI. Code for Fair Disclosure
VII. Risk Management Policy
VIII. Dividend Distribution Policy
RISK MANAGEMENT
Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Regulation 17(9) of the Listing Regulation, the Company has framed a Risk Management Policy. In the opinion of the Board there appears to be no element of risk which may threaten the existence of the Company.
VIGIL MECHANISM & WHISTLE BLOWER POLICY
The Company has an established Vigil Mechanism for Directors / Employees to report concerns about unethical behaviors, actual or suspected fraud or violation of the code of conduct or ethics policy. It also provides for adequate safeguards against victimization of Directors / Employees who avail of the mechanism. The Company affirms that no personnel have been denied access to the Audit Committee. The Company has formulated a Policy of Vigil Mechanism and has established a mechanism that any personnel may raise Reportable Matters. All suspected violations and Reportable Matters can be reported to the Chairman of the Audit Committee at e-mail id â[email protected]â. The key directions/actions can be informed to the Chairman/Managing Director of the Company. The Whistle Blower Policy has been framed and displayed in the company website.
CSR EXPENDITURE
During the year, in pursuance of the recommendations of the CSR committee the Company has contributed Rs. 481.75 Lakhs being 2% of the average three years net profit of the Company towards implementing the CSR activities. Annual Report on CSR, as required by the Act, is appended.
BOARD MEETINGS
The Board of Directors met Five times during the financial year on 03.05.2017, 25.07.2017 30.10.2017 06.02.2018 and 22.02.2018. The Composition of Board, procedure, dates and other details are included in the Corporate Governance Report that forms part of this Report.
CONSOUDATED FINANCIAL STATEMENTS
Your Directors have pleasure in attaching the Consolidated Financial Statements pursuant to the provisions of the âAcf and the Listing Regulations entered into with the Stock Exchanges. They are prepared in accordance with the Ind-AS prescribed by the Institute of Chartered Accountants of India, in this regard. The Consolidated Financials also marked a significant increase in its Revenue as well as Profitability.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has duly complied with the provisions of Section 186 of the Act and as required therein the details of the Borrowals, Security, Investment etc., are annexed byway of notes to accounts.
RELATED PARTY TRANSACTIONS
All Related Party Transactions that were entered into during the financial year were only between Holding Company and Wholly owned Subsidiary Companies in the ordinaiy course of business, whose accounts are consolidated with Holding Company and placed before the shareholders at the General Meeting for approval. Pursuant to the provisions of Section 177 of the Companies Act, 2013 the related party transactions entered during the year have been approved by the Audit Committee.
The Transactions as required under Inidan Accounting Standards 24 are reported in Note 37 of the Notes to Accounts of the Consolidated Financial Statements as well as Standalone Financial Statements of your Company. The Companyâs Policy on dealing with related party transactions is available on the Companyâs website.
EMPLOYEE WELFARE
KPR explicitly focus on extending trendsetter welfare facilities to the employees as it improves the quality of work life by enriching their life style keeping them satisfied and contended. KPRâs Employee welfare includes providing healthy working environment, upgrading their education & skill level thus improving the standard of living of the employees and their families. Adequate levels of earnings, safe and humane conditions of work and access to some minimum social security benefits are the major qualitative dimensions of employment. The social and economic aspects of the life of an employee have a direct influence on the social and economic development of the nation. There is every need to take additional care of the employees by providing both statutoiy and non-statutory facilities to them. KPR always go the extra mile by practicing various welfare activities so as to empower the human capital besides strengthening their productivity level.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and others entitled thereto, excluding the information on employeesâ particulars which is available for inspection by the members at the Registered Office of the Company during business hours on working days of the Company up to the date of ensuing Annual General Meeting. If any member is interested in inspecting the same, such member may write to the Company Secretaiy in advance.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 provides for protection against sexual harassment of women at workplace and for the prevention and redressal of complaints of sexual harassment and also for the matters incidental thereto. The Company has accordingly adopted the policy against Sexual Harassment of Women at Workplace, for the purpose of preventing prohibiting and redressing sexual harassment of female employees at all the workplace within the Company which are based on fundamental principles of justice and fair play.
Further, Anti Sexual Harassment Committee has been constituted at each unit which shall be responsible for redressal of complaints related to sexual harassment. The details of all such Complaints and its proper redressal through prompt corrective steps are informed to the Top Management so as to ensure that suitable processes and mechanisms are put in place to ensure that issues of sexual harassment, if any, are effectively addressed. During the year, no complaints of sexual harassment were received by the Company from any of its Units.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act read with the Companies (Accounts) Rules, 2014 are provided in the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 134(5) of the Companies Act, 2013, the Board of Directors of the Company hereby state and confirm that;
I. In the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.
II. The Directors have selected accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review.
III. The Directors have taken proper and sufficient care for the maintenance of adequate record in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
IV. The Directors have arranged preparation of the accounts for the financial year ended 31.03.2018 on a going concern basis.
V. The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.
VI. 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 REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS STATEMENT
Corporate Governance Report and Management Discussion and Analysis Statement are attached to this Report. Certificate from the Statutory Auditors of the Company confirming the compliance with the conditions of Corporate Governance as stipulated under Schedule V of the Listing Regulation is also attached to this report.
BUSINESS RESPONSIBILITY REPORT
In pursuance of Regulation 34(2) (6) of the SEBI (LODR) Regulations, 2015, the Business Responsibility Report, containing the initiatives taken by the company from environmental, social and governance perspective, forms part of this Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The details of internal financial control and their adequacy are included in the Report of management Discussion & Analysis, which forms part of this report.
RATIO OF REMUNERATION TO EACH DIRECTOR
Details / Disclosures of Ratio of Remuneration of Director to the median employeeâs remuneration as required by the Act and Companies Rules are appended.
SIGNIFICANT & MATERIAL ORDER PASSED BY THE REGULATORS
No significant and material order was passed by any Regulators that have any impact on the going concern status and the operations of the Company.
DETAILS REGARDING ISSUE OF SHARES
During the year under review the Company has not issued any shares. However the Company has resorted to Buyback.
AUDITORS
In the 14th Annual General Meeting of the Company held on 28.08.2017, M/s. BSR & Co LLP, Chartered Accountants (ICAI Firm Regn. No. 101248W/W-100022) were appointed as Statutory Auditors of the Company for a period of 5 Years from the Financial Year 2017 - 18, subject to ratification at every Annual General Meeting, as per the requirements of the Companies Act 2013. However, the Companies Amendment Act 2017 has dispensed with the requirement of ratification at every Annual General Meeting. The Board recommends the continuity of BSR & Co LLP, Chartered Accountants as Auditors for the FY 2018-19.
AUDITORS REPORT
The Auditors Report to the Shareholders does not contain any qualification.
COST AUDIT
In pursuance of Companies (Cost Records and Audit) Rules, 2014, the Company has appointed a Cost Auditor for the Company to audit the cost records for the Financial Year 2017-18.
SECRETARIAL AUDIT REPORT
As required by the Act a Secretarial Audit Report issued by a Company Secretary in practice is annexed.
ACKNOWLEDGEMENT
Your Directors acknowledge with gratitude and express their appreciation for the assistances and co-operation received from the Bankers, Government Authorities, Customers, Vendors and Members during the year under review. Your Directors also wish to thank the employees at all levels for their co-operation and dedication.
By order of the Board of Directors
Coimbatore K.P. Ramasamy
30.04.2018 Chairman
Mar 31, 2017
Dear Members,
The Board of Directorsâ take pleasure in presenting the report on the operations and business of the Company along with Audited Financial Statements for the Financial Year ended 31st March, 201Z
FINANCIAL RESULTS (Rs. in Lakhs)
PARTICULARS |
STANDALONE |
CONSOLIDATED |
||
Sales and Other Income |
2016-17 |
2015-16 |
2016-17 |
2015-16 |
Domestic Sales |
1,52,162 |
1,37522 |
1,69,259 |
1,60,329 |
Export Sales |
64,200 |
54,397 |
1,01,395 |
90,654 |
Other Income |
8,264 |
7629 |
13,755 |
11,458 |
2,24,626 |
1,99,548 |
2,84,409 |
2,62,441 |
|
Profit before Interest & Depreciation |
47,277 |
39,022 |
59,074 |
49,346 |
Less: Interest |
4,503 |
4,442 |
6,445 |
5,763 |
Depreciation |
11,743 |
12,384 |
14,939 |
15,205 |
Profit Before Tax Less: Taxation |
31,031 |
22,196 |
37,690 |
28,378 |
Provision for Current Tax |
7,668 |
6,574 |
9,119 |
8,390 |
Tax relating to earlier years |
(166) |
145 |
(159) |
165 |
MAT Credit Entitlement |
1,420 |
1,119 |
||
7,502 |
6,719 |
7,540 |
7436 |
|
Deferred Tax expense / (Credit) |
(313) |
(137) |
1,468 |
(129) |
Profit After Tax |
23,842 |
15,614 |
28,682 |
21,071 |
Other Comprehensive Income (Net of tax) |
15 |
23 |
15 |
5 |
Total Comprehensive Income |
23,857 |
15,637 |
28,697 |
21,076 |
REVIEW OF OPERATIONS
It has been a significant and eventful year for KPR. The expansion programs as contemplated have been successfully completed. Its strategic direction towards value addition has started yielding results. The revenue recorded a growth of 13% over previous year and PAT by 52%. The cotton price continues to be stable. The wind energy (Green power) supported the operations considerably. Power availability in the State has been comfortable. Due to hike in Minimum Wages by the Government, the labour cost has gone up. The well acclaimed labour practices enabled smooth flow of labour to the expanded capacities. Our consistent improvement in profitability has been due to several factors such as strategic plans, reduced cost, increased production capacity etc. Despite the slowdown due to demonetization drive, we have not seen any major impact on our business.
FUTURE OUTLOOK
Rapid urbanization, growing population, rising per-capita income, enlarging middle class & young population exposed to changing tastes and fashion have led to huge opportunities for the textiles sector in the domestic market. Growing encouragement to downstream sectors of the Textile Industry from the Government and the efforts for expediting Free Trade Agreementâs to improve the competitiveness on the global front, would improve the export earnings of the Industry significantly. ICP.R, which is well equipped with strong factors of production, financial and operational performance is an advantageous position to reap the benefits of bright outlook for the Sector as a whole.
SUB -DIVISION OF EQUITY SHARE (SPLIT OF SHARE)
During November 2016, after obtaining the consent of the Members of the Company by Postal Ballot and complying with the applicable provisions of the Act & Regulations, the Equity Share of the Company of the Face Value of Rs. 10/- each has been split into two shares of Face Value of Rs. SI- each. The new subdivided shares have been credited to the concerned shareholdersâ Demat accounts. The new ISIN of the Company at Depositories is INE930H01023.
BUYBACK
The Board of Directors of the Company announced a Buyback of 14,70,000 fully paid-up equity shares (1.95% of the pre Buyback equity share capital) of the face value of Rs. 5/- each from all the existing shareholders on a proportionate basis, through the âTender Routeâ process at a price of Rs. 660 per Equity Share payable in cash. The total consideration amounted to Rs. 97.02 Crores representing 9.95% of the aggregate of the paid-up equity share capital and free reserves, as per the audited accounts of the Company for the year ended March 31, 2016. After complying with the applicable laws, the Company bought back 14,70,000 Equity Shares. The funds in respect of accepted Equity Shares have been paid out. Buyback was completed on February 13, 2017 The Promoters who have participated in the Buyback offer re-organised their stake to the permitted levels subsequently as per their undertaking to SEBI. The present Paid up Capital Post Buyback is Rs. 36.95 Crores.
DIVIDEND
The Board in its meeting held on 03.05.2017 has recommended a Dividend of 15% on Equity Shares of Rs. 5/- each (Rs. 0.75), subject to the approval of the Members at the Fourteenth Annual General Meeting.
RESERVES
During the year under review the Company has transferred Rs. 73 Lakhs to the Capital Redemption Reserve towards Buyback of Equity Shares and Rs. 2,386 Lakhs to the General Reserve.
FINANCE
Our prompt repayments of loan and interest continued. The funds are effectively managed to reduce the cost of interest. During the year, we have availed additional term loans to fund the expansion Projects. The comfortable cash position is expected to continue with the prospective outlook.
EXPANSION
The Financial Year 2016-17 has been a record year for KPR in augmenting its capacities in the value added segment. A brief about the expansion plans completed during the year is furnished below:
I. GARMENT
KPR commissioned its large Green field Garment manufacturing facility with a capacity to produce 36 million Garments per annum under one roof. Now with a total capacity of 95 Million Garments we are one of the largest Garment Manufacturers in India. New Clients and new Markets are added. Order book positions, response from existing and prospective clients are promising.
II DOUBLING OF PROCESSING CAPACITY
We have also commenced operations in the âState of the Altâ Processing Unit II. The advanced technology of cold processing adopted therein reduces the water consumption by 30% and eliminates the usage of salt completely. This eco - friendly facility will economise the cost of production and enhance the Fabric quality with excellent colour uniformity. This new unit will further add value to the Garment Division.
III. NEW SOPHISTICATED PRINTING DIVISION
KPR established a new Printing Division with the Sophisticated Technology Printing Machines, imported from Austria. This advanced technology empowers us to print sharp designs with high level of accuracy. Entire range of fabrics, such as light & heavy as well as delicate & sensitive fabrics can be printed in the same machine, without any friction. Its ability to print voluminous fabrics with high resolution is a salient feature. The sharpness & accuracy in printing the design and colour are its significant strengths. This new division shall cater to the Premium Brandsâ high-end garment requirements carrying higher revenue and margin.
SUBSIDIARY COMPANIES
In respect of statements pursuant to Section 129(3) of the Companies Act, 2013 (Hereinafter referred to as the âActâ) in âForm AOC - 1â containing the details of Subsidiaries forms part of this Annual Report. However as required by the âAct1, we give below a brief report on their performance.
I. QUANTUM KNITS PVT. LIMITED
The garment business has been consolidated for effective management.
II. K.P.R. SUGAR MILL LIMITED
The continuous drought conditions at Karnataka impacted the production and supply of sugarcane. The sugarcane crushing commenced in December 2016 during the year, could produce 32,995 metric tons of sugar. Out of 423 Lakh units of power generated 294 Lakh units were sold and 129 Lakh units captively consumed. However sugar prices continues to be stable.
III JAHNVI MOTOR PRIVATE LIMITED
In Financial Year 2016-17 the Company sold 192 cars and with improved service income marked total revenue of Rs. 115.07 Crores. The National Demonetization drive during the year has impacted the sale of automobiles for the industry as a whole considerably. However the Automobile Industiy is optimistic of its growth during the current year.
IV. GALAXY KNITS LIMITED
The Company has not yet commenced its operation.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from public during the year under review.
DIRECTORS
The Company has adequate Independent Directors in compliance with the Act and Listing Regulations. Familiarization Program on the Company and its operation was conducted for the Independent Directors. Requisite declaration from the Independent Directors of the Company under Section 149 (7) of the Act confirming that they meet with the criteria of their Independence laid in Section 149 (6) have been obtained.
Sri.C.R. Anandakrishnan, Director retires by rotation at the ensuing Annual General Meeting and is eligible for reappointment.
The details of the aforesaid Director, required to be disclosed under Regulation 36(3) of the Listing Regulation, form part of the Notice of the ensuing Annual General Meeting. Your Directors recommend his re- appointment. All the Directors of the Company have confirmed that they are not disqualified from being appointed as Directors in terms of Section 164 (2) of the Act.
KEY MANAGERIAL PERSONNEL AND MANAGERIAL REMUNERATION CRITERIA
In pursuance of the Act the Company has Key Managerial Personnel. None of the Managing Directors or Whole Time Directors receive any remuneration or commission from the Subsidiary Companies and the remuneration paid to them is within the purview of the provisions of Section 197 of the Act. The Company pays remuneration by way of salary, perquisites etc., to its Chairman, Managing Directors and fixed monthly remuneration to its Executive Directors and Whole Time Director in line with the approvals accorded by the General Meetings in pursuance of the recommendation of the Nomination and Remuneration Committee as per the guiding principles laid down in the Nomination and Remuneration Policy. The information as required by Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended.
ANNUAL PERFORMANCE EVALUATION
In line with the criteria evolved by the Nomination and Remuneration Committee, the performance of all Directors, Committees, Chairman etc., have been evaluated pursuant to the provisions of the Act and the Listing Regulations.
COMMITTEES
As required by the provisions of the Act and Listing Regulation, the Company has already formed the following Committees, the details of which are disclosed in the Report on Corporate Governance forming part of this Report.
I Audit Committee
II Stake Holders Relationship Committee
III Nomination and Remuneration Committee
IV. Corporate Social Responsibility (CSR) Committee
POLICIES
In pursuance of the Act and the Listing Regulation, the following policies have been framed and disclosed on the Companyâs website âwww.kprmilllimited.comâ.
I Nomination & Remuneration Policy
II Related Party Transaction Policy
III. CSR Policy
IV. Whistle Blower Policy consisting of Vigil Mechanism
V. Policy on Determining Material Subsidiaries
VI. Code for Fair Disclosure
VII. Risk Management Policy
VIII. Dividend Distribution Policy
RISK MANAGEMENT
Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Regulation 17(9) of the Listing Regulation, the Company has framed a Risk Management Policy. In the opinion of the Board there appears to be no element of risk which may threaten the existence of the Company.
VIGIL MECHANISM & WHISTLE BLOWER POLICY The Company has an established Vigil Mechanism for Directors / Employees to report concerns about unethical behaviors, actual or suspected fraud or violation of the code of conduct or ethics policy. It also provides for adequate safeguards against victimization of Directors / Employees who avail of the mechanism. The Company affirms that no personnel have been denied access to the audit committee. The Company has formulated a Policy of Vigil Mechanism and has established a mechanism that any personnel may raise Reportable Matters. All suspected violations and Reportable Matters can be reported to the Chairman of the Audit Committee at e-mail id â[email protected]â. The key directions / actions can be informed to the Chairman / Managing Director of the Company. The Whistle Blower Policy has been framed and displayed in the Companyâs Website.
CSR EXPENDITURE
During the year, in pursuance of the recommendations of the CSR committee, the Company has contributed Rs. 392.24 Lakhs being 2% of the average three years net profit of the Company towards implementing the CSR activities. Annual Report on CSR, as required by the Act is appended.
BOARD MEETINGS
The Board of Directors met Six times during the financial year on 28.04.2016, 25.07.2016,05.10.2016,24.10.2016,0712.2016 and 25.01.2017. The Composition of Board, procedure, dates and other details are included in the Corporate Governance Report that forms part of this Report.
CONSOUDATED FINANCIAL STATEMENTS
Your Directors have pleasure in attaching the Consolidated Financial Statements pursuant to the provisions of the âActâ and the Listing Regulations entered into with the Stock Exchanges. They are prepared in accordance with the Ind-AS prescribed by the Institute of Chartered Accountants of India, in this regard. The Consolidated Financials also marked a significant increase in its Revenue as well as Profitability.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has duly complied with the provisions of Section 186 of the Act and as required therein the details of the Borrowals, Security, Investment etc., are annexed by way of notes to accounts.
RELATED PARTY TRANSACTIONS
All Related Party Transactions that were entered into during the financial year were only between Holding Company and Wholly owned Subsidiary Companies in the ordinary course of business, whose accounts are consolidated with Holding Company and placed before the shareholders at the General Meeting for approval. Accordingly, pursuant to Section 134 (3) (h) read with Rule 8 (2) of the Companies (Accounts) Rules, 2014 and Regulation 23 of the Listing Regulations there are no transactions to be reported under Section 188 (1) of the Act.
However, the Transactions as required under âInd-ASâ are reported in the Notes to Accounts of the Consolidated Financial Statements as well as Standalone Financial Statements of your Company. The Companyâs Policy on dealing with related party transactions is available on the Companyâs website.
EMPLOYEE WELFARE
Labour welfare activities in an industrialized society have far reaching impact not only on the work force but also on the facets of human resources building a humane society. The underlying principle in our welfare practices is to empower the workers with human value addition and make the workers contribute voluntarily their loyal services in genuine spirit of co-operation to promote economic development by increasing production and productivity. The trend setter facilities are provided to supplement the earning of the workers by services such as comfortable & safe accommodation, hygienic food & working conditions, medical assistance, education, library, sports, extra-curricular activities, recreation etc. Higher education facilities provided at KPR is one of the best matching the high standards of an Academic Institution. The Employees are also keen in effective utilization of the education and skill development facilities. During the Academic year 2016 also, supported by the best quality education extended by the Company, several employees excelled in the Government conducted Examinations securing higher ranks. During the year also we have enrolled around 2000 employees under the Central Government skill development initiatives.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and others entitled thereto, excluding the information on employeesâ particulars which is available for inspection by the members at the Registered Office of the Company during business hours on working days of the Company up to the date of ensuing Annual General Meeting. If any member is interested in inspecting the same, such member may write to the Company Secretary in advance.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 provides for protection against sexual harassment of women at workplace and for the prevention and redressal of complaints of sexual harassment and also for the matters incidental thereto. The Company has accordingly adopted the policy against Sexual Harassment of Women at Workplace, for the purpose of preventing, prohibiting and redressing sexual harassment of female employees at all the workplace within the Company which are based on fundamental principles of justice and fair play.
Further, Anti Sexual Harassment Committee has been constituted at each unit which shall be responsible for redressal of complaints related to sexual harassment. The details of all such Complaints and its proper redressal through prompt corrective steps are informed to the Top Management so as to ensure that suitable processes and mechanisms are put in place to ensure that issues of sexual harassment, if any, are effectively addressed. During the year, no complaints of sexual harassment were received by the Company from any of its Units.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act read with the Companies (Accounts) Rules, 2014 are provided in the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 134(5) of the Companies Act, 2013, the Board of Directors of the Company hereby state and confirm that;
I. In the preparation of the Annual Accounts, the applicable Ind-AS have been followed along with proper explanation relating to material departures.
II The Directors have selected accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review.
III. The Directors have taken proper and sufficient care for the maintenance of adequate records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
IV. The Directors have arranged preparation of the accounts for the financial year ended 31.03.2017 on a going concern basis.
V. The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.
VI. 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 REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS STATEMENT
Corporate Governance Report and Management Discussion and Analysis Statement are attached to this Report. Certificate from the Statutory Auditors of the Company confirming the compliance with the conditions of Corporate Governance as stipulated under Schedule V of the Listing Regulation is also attached to this Report.
BUSINESS RESPONSIBILITY REPORT
In pursuance of Regulation 34(2)(f) of the SEBI (LODR) Regulations, 2015, the Business Responsibility Report, containing the initiatives taken by the company from environmental, social and governance perspective, forms part of this Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The details of internal financial control and their adequacy are included in the Report of Management Discussion & Analysis, which forms part of this Report.
RATIO OF REMUNERATION TO EACH DIRECTOR
Details / Disclosures of Ratio of Remuneration of Director to the median employeeâs remuneration as required by the Act and Companies Rules are appended.
SIGNIFICANT & MATERIAL ORDER PASSED BY THE REGULATORS
No significant and material order was passed by any Regulators that have any impact on the going concern status and the operations of the Company.
DETAILS REGARDING ISSUE OF SHARES
During the year under review the Company has not issued any shares. However the Company has subdivided its Share and resorted to Buyback.
AUDITORS
M/s. Deloitte Haskins & Sells, Chartered Accountants, Coimbatore, (ICAI No: 008072S) the Statutory Auditors of the Company retire at the ensuing Annual General Meeting upon completion of their term as per the Art.
As suggested by the Audit Committee the Board recommends the appointment of BSR & Co., LLP, Chartered Accountants (Firm Registration Number: 101248W/W-100022), Chennai, as Statutoiy Auditors of the company.
AUDITORS REPORT
The Auditorâs Report to the Shareholders does not contain any qualification.
COST AUDIT
In pursuance of Companies (Cost Records and Audit) Rules, 2014, the Company has appointed a Cost Auditor for the Company to audit the cost records for the Financial Year 2017-18.
SECRETARIAL AUDIT REPORT
As required by the Act a Secretarial Audit Report issued by a Company Secretary in practice is annexed.
EXTRACT OF ANNUAL RETURN
Pursuant to section 92(3) of the Art and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of annual return in MGT 9 forms part of this Report.
ACKNOWLEDGEMENT
Your Directors acknowledge with gratitude and express their appreciation for the assistances and co-operation received from the Bankers, Government Authorities, Customers, Vendors and Members during the year under review. Your Directors also wish to thank the employees at all levels for their co-operation and dedication.
By order of the Board of Directors
Coimbatore K.P. Ramasamy
03.05.2017 Chairman
Mar 31, 2016
Dear Members,
The Board of Directors'' take pleasure in presenting the report on the
operations and business of the Company along with Audited Financial
Statements for the year ended 31st March, 2016.
FINANCIAL RESULTS (Rs. in Lakhs)
PARTICULARS STANDALONE CONSOLIDATED
2015-16 2014-15 2015-16 2014-15
Sales and Other Income
Domestic Sales (Net of
Excise Duty) 1,37,522 1,54,752 1,59,386 1,68,413
Export Sales 54,397 48,803 90,654 80,432
Other Income 7,569 6,682 11,364 10,134
1,99,488 2,10,237 2,61,404 2,58,979
Profit before Interest
& Depreciation 38,962 37,843 49,252 46,134
Less : Interest 4,442 6,450 5,729 8,394
Depreciation 12,384 12,587 15,205 15,402
Profit Before Tax 22,136 18,806 28,318 22,338
Less : Taxation
Provision for Current Tax 6,574 5,546 8,390 6,573
Tax relating to earlier
years 145 (82) 165 (95)
MAT Credit - 1,281 1,119 1,522
6,719 4,183 7,436 4,956
Deferred Tax Expense
/ (Credit) (137) 25 (129) 25
Profit After Tax 15,554 14,598 21,011 17,357
REVIEW OF OPERATIONS
In the year under review, despite challenges faced by the Industry &
Economy in general, the Company has performed better. The decline in
cotton price over 15%, created an equivalent adverse impact on Yarn &
Fabric prices. Though power cut in the State has been lifted, the
continued evacuation issue deteriorated our wind power generation
considerably. However with value added products, optimum utilization of
capacities and improved business & margin in Garment, the profitability
of the Company has improved. Sensing the need of customers for
speciality products, the Company started producing the Slub effect
Melange (Colour Melange) and Polyester Cotton Yarn, besides converting
the existing facility to value added Compact yarn producing facility.
These products carry higher margin and consistent demand. The Garment
Industry is expected to continue it''s upbeat. Exports from Tirupur
Market, the knitwear hub of India, the value of shipments crossed
Rs.21,000 Crores for the fiscal 2015. If the same trend continues for
three years, the exports will double. Our expansion initiatives are
progressing well as contemplated. With the above strategies, the
Company is hoping to secure higher margin in the coming years. With
comfortable cash flow, it is expected that the debt level may come down
gradually leading to a debt free entity in 3-4 Years.
DIVIDEND
Your Company has been maintaining a consistent dividend track record.
Considering better performance and strong liquidity, during the year
the Board of Directors have declared two interim dividends, 50% (Rs.5)
during lanuary 2016 and 40% (Rs.4) during March 2016. The Board in its
Meeting held on 28th April, 2016 has recommended a final dividend of
10% (Rs.1) on Equity Shares, thus aggregating to 100% (Rupees Ten per
Share on Equity Share of Rupees Ten each), subject to the approval of
the Members at the Thirteenth Annual General Meeting.
RESERVES
During the year under review the Company has transferred Rs.1,500 Lakhs
to the Capital Redemption Reserve towards redemption of Preference
Shares and Rs.15,554 Lakhs were transferred to General Reserve.
GARMENTS EXPANSION
The expansion of Garment capacity by 36 million garments to cope up
with the upsurge in market demand is progressing well and nearing
completion. It would entail KPR as one of the largest Garment producing
Corporates in India. The response from existing customers as well as
from new markets is much encouraging. The interest evinced by leading
Brands from new markets substantiates our right move. It is expected to
be commissioned during the First Quarter of Financial Year 2016-17.
DOUBLING OF PROCESSING CAPACITY
The sustained growth foreseen in global apparel industry coupled with a
shift in overall trade towards Asia over the years in view of lower
cost of production, has made India the most preferred, competitive
textile manufacturing hub. To keep pace with fast-changing customer
demand, design and technology, increase of production capacity coupled
with technological advancement has become essential. Currently, India
lags in processing capacities in terms of modern technology. Bearing it
in mind and commensurate with the increased in-house requirement on
account of Garment capacity expansion and future market potential, an
expansion drive has been mooted in its Fabric processing facility which
has a backing of strong Effluent Treatment Plant. The key factors of
expansion are:
- 100% capacity addition - From 25 MT to 50 MT per day
- Advanced continuous process technology minimizing cost of production.
- Hi-tech Rotary screen printing to escalate operations The expansion
drive facilitates the Company''s commitment to grow with the market
trend. Its salient features are;
- elimination of salt usage in dyeing that considerably reduces the
water & energy consumption, effluent etc., thereby minimising cost of
production.
- ensuring improved quality, higher color uniformity;
- garnering large overseas customers from new giant markets besides
widening the current client base;
- safe processing of delicate & sensitive Fabrics with minimal
interruption through Rotary screen printing;
- eligible for 10% capital subsidy under A - TUF scheme.
Investment to ensure this capacity addition will be Rs.120 Crores
funded through internal accruals and Bank finance. The project is
estimated to be completed in 9 Months'' time.
SUBSIDIARY COMPANIES
The Company has Four Wholly Owned Subsidiary Companies, their
financials and details as required Under Section 136 of the Companies
Act, 2013 (hereinafter referred to as the ''Act'') are available in the
website of the Company.
Statements pursuant to Section 129 (3) of the Act, in ''Form AOC - 1''
forms part of this Annual Report. However as required by the ''Act'', we
give below a brief report on their performance.
QUANTUM KNITS PVT. LIMITED
During the year under review the high growth in apparel market and its
exports enabled the Company a better margin. The significant increase
in the Apparel consumption in developing economies is expected to
sustain the growth level for a long term.
K.PR.SUGAR MILL LIMITED
Consequent on the delay in fixation of cane price by the Government
during the year also, there has been a delay in Sugar crushing. The
drought prevailed at Karnataka, after 5 years of good monsoon, has
curtailed sugarcane availability. The Sugar price which was reeling
under tremendous pressure due to sluggish demand had a reprieve during
the last Quarter of the Financial Year. Produced 66,335 metric tons of
sugar. Out of 1005 Lakhs units of power generated 760 Lakhs units were
sold and 245 Lakhs units captively consumed.
JAHNVI MOTOR PRIVATE LIMITED
In Financial Year 2015-16, the Company sold 271 Cars and with improved
Service Income, it earned a total Revenue of Rs.131.60 Crores. Its
effective marketing setup sustained the ''No.1'' Position under category
''B'' Dealership, besides securing ''All India Best Partner'' title in
after Sales Service.
GALAXY KNITS LIMITED
The Company has not yet commenced its operation.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from public during the
year under review.
FINANCE
Our prompt repayments and pre-closure of certain high cost debts,
facilitated by healthy Cash flow, elevated the credibility of your
Company. It enabled prudent application of funds and better negotiation
strength. This exemplary trend is expected to continue.
DIRECTORS
Sri. M.J. Vijayaraaghavan, Director passed away on 10.06.2015. Taking
note of his long association and sane advice, the Board placed on
record the invaluable services rendered by him as a Senior Director and
Audit Committee Chairman.
Sri. A. Sekar, Whole time Director had retired on 27.07.2015 and Sri.
P. Selvakumar, Senior Executive of the Company was appointed as a Whole
Time Director of the Company. The Board in its Meeting held on
09.03.2016 has co-opted Sri. E.K. Sakthivel, as Additional Director,
under the designation ''Executive Director'' subject to the approval of
the Company at Annual General Meeting. At the ensuing Annual General
Meeting suitable Resolution has been included in the Notice of the said
Meeting to regularize his appoinment.
The Company has adequate Independent Directors in compliance with the
Act and SEBI (LODR) Regulations, 2015 hereinafter referred to as
Listing Regulations. Familiarization Program on the Company and its
operation was conducted for the Independent Directors. Requisite
declaration from the Independent Directors of the Company under Section
149 (7) of the Act confirming that they meet with the criteria of their
Independence laid in Section 149 (6) have been obtained.
Sri. P. Selvakumar, Director retires by Rotation at the ensuing Annual
General Meeting and is eligible for reappointment.
The details of the aforesaid Directors, required to be disclosed under
Regulation 36 (3) of the Listing Regulations, form part of the Notice
of the ensuing Annual General Meeting. Your Directors recommend their
appointment / re-appointment. All the Directors of the Company have
confirmed that they are not disqualified from being appointed as
Directors in terms of Section 164 (2) of the Act.
KEY MANAGERIAL PERSONNEL AND MANAGERIAL REMUNERATION CRITERIA
In pursuance of the Act the Company has Key Managerial Personnel. None
of the Managing Directors or Whole Time Directors receive any
remuneration or commission from the Subsidiary Companies and the
remuneration paid to them is within the purview of the provisions of
Section 197 read with Schedule V of the Act. The Company pays
remuneration by way of salary, perquisites, commission (variable
component) to its Chairman, Managing Directors and fixed monthly
remuneration to its Executive Directors and Whole Time Director in line
with the approvals accorded by the General Meetings in pursuance of the
recommendation of the Nomination and Remuneration Committee as per the
guiding principles laid down in the Nomination and Remuneration Policy
and also by the Board of Directors. The information as required by
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014 is appended.
ANNUAL PERFORMANCE EVALUATION
In line with the criteria evolved by the Nomination and Remuneration
Committee, the performance of all Directors, Committees, Chairman etc.,
have been evaluated pursuant to the provisions of the Act and the
Listing Regulations.
COMMITTEES
As required by the provisions of the Act and Listing Regulations, the
Company has already formed the following Committees, the details of
which are disclosed in the Report on Corporate Governance forming part
of this Report.
I. Audit Committee
II. Stakeholders Relationship Committee
III. Nomination and Remuneration Committee
IV. Corporate Social Responsibility (CSR) Committee
POLICIES
In pursuance of the Act and the Listing Regulations, the following
policies have been framed and disclosed on the Company''s website
''www.kprmilllimited.com''.
I. Nomination & Remuneration Policy
II. Related Party Transaction Policy
III. CSR Policy
IV. Whistle Blower Policy consisting of Vigil Mechanism
V. Policy on Determining Material Subsidiaries
VI. Code for Fair Disclosure
VII. Risk Management Policy
RISK MANAGEMENT
Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Regulation
17 (9) of the Listing Regulations, the Company has framed a Risk
Management Policy. In the opinion of the Board there appears to be no
element of risk which may threaten the existence of the Company.
VIGIL MECHANISM & WHISTLE BLOWER POLICY
The Company has an established Vigil Mechanism for Directors /
Employees to report concerns about unethical behaviors, actual or
suspected fraud or violation of the code of conduct or ethics policy.
It also provides for adequate safeguards against victimization of
Directors / Employees who avail of the mechanism. The Company affirms
that no personnel have been denied access to the Audit Committee. The
Company has formulated a Policy of Vigil Mechanism and has established
a mechanism that any personnel may raise reportable matters. All
suspected violations and reportable matters can be reported to the
Chairman of the Audit Committee at e-mail id
''[email protected]''. The key directions / actions can be
informed to the Chairman / Managing Director of the Company.
The Whistle Blower Policy has been framed and displayed in the
Company''s Website.
CSR EXPENDITURE
During the year, in pursuance of the recommendations of the CSR
Committee, the Company has contributed Rs.338 Lakhs being 2% of the
average three years Net Profit of the Company towards implementing the
CSR activities. Annual Report on CSR, as required by the Act is
appended.
BOARD MEETINGS
The Board of Directors met five times during the financial year on
05.05.2015, 27.07.2015, 27.10.2015, 27.01.2016 and 09.03.2016. The
Composition of Board, procedure, dates and other details are included
in the Corporate Governance Report that forms part of this Report.
CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in attaching the Consolidated Financial
Statements pursuant to the provisions of the ''Act'' and the Listing
Regulations entered into with the Stock Exchanges. They are prepared in
accordance with the Accounting Standards prescribed by the Institute of
Chartered Accountants of India, in this regard. The Consolidated
Financials also marked a significant increase in its Revenue as well as
Profitability.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has duly complied with the provisions of Section 186 of the
Act and as required therein the details of the Borrowals, Security,
Investment etc., are annexed by way of notes to accounts.
RELATED PARTY TRANSACTIONS
All Related Party Transactions that were entered into during the
financial year were only between Holding Company and Wholly owned
Subsidiary Companies in the ordinary course of business, whose accounts
are consolidated with Holding Company and placed before the
shareholders at the General Meeting for approval. Accordingly,
pursuant to Section 134 (3) (h) read with Rule 8 (2) of the Companies
(Accounts) Rules, 2014 and Regulation 23 of the Listing Regulations
there are no transactions to be reported under Section 188 (1) of the
Act.
However, the Transactions as required under Accounting Standards AS-18
are reported in the Notes to Accounts of the Consolidated Financial
Statements as well as Standalone Financial Statements of your Company.
The Company''s Policy on dealing with related party transactions is
available on the Company''s website.
EMPLOYEE WELFARE
The Employee Welfare Initiatives and practices followed by the Company,
acclaimed as one of the best in the Corporate World, have got far
reaching impact on the societal development. KPR Group employs over
15,000 Workers. The unique labour model uplifting the marginalized
section of the society - especially women folk - plays a vital role in
improving the efficiency and productivity of the employees, besides
ensuring them quality life both at work and family life.
Textile Industry is labour intensive and the Indian Textile Industry
faces labour shortage. However, the impeccable welfare measures
extended by KPR facilitate the process of mobilization of labour
resources with ease. Extension of higher education facilities, the
flagship of the welfare measures, is continuously best utilized by the
workers as can be evidenced by their commendable performance in the
Government examinations. So far over 15,000 employees have been
benefited by the higher education facilities. The workforce becomes
skilled, educated and employable wherever they are. Their consistent
dedication and support are considered as invaluable resources for the
Company.
Under the Central Government Skill Development initiative (PMKVY), over
2000 Employees of our Company have been enrolled during the year.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of
the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 in respect of Employees of the Company, will be provided
upon request. In terms of Section 136 of the Act, the reports and
accounts are being sent to the members and others entitled thereto,
excluding the information on employees particulars which is available
for inspection by the members at the Registered Office of the Company
during business hours on working days of the Company up to the date of
ensuing Annual General Meeting. If any member is interested in
inspecting the same, such member may write to the Company Secretary in
advance.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013 provides for protection against sexual harassment
of women at workplace and for the prevention and redressal of
complaints of sexual harassment and also for the matters incidental
thereto. The Company has accordingly adopted the policy against Sexual
Harassment of Women at Workplace, for the purpose of preventing,
prohibiting and redressing sexual harassment of female employees at all
the workplace within the Company which are based on fundamental
principles of justice and fair play.
Further, Anti Sexual Harassment Committee has been constituted at each
unit which shall be responsible for redressal of complaints related to
sexual harassment. The details of all such complaints and its proper
redressal through prompt corrective steps are informed to the Top
Management so as to ensure that suitable processes and mechanisms are
put in place to ensure that issues of sexual harassment, if any, are
effectively addressed. During the year, no complaints of sexual
harassment were received by the Company from any of its Units.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo, as required to be disclosed under
the Act read with the Companies (Accounts) Rules, 2014 are provided in
the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 134 (5) of the Act, the Board
of Directors of the Company hereby state and confirm that;
I. In the preparation of the Annual Accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures.
II. The Directors had selected accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the profit of the
Company for the year under review.
III. The Directors had taken proper and sufficient care for the
maintenance of adequate record in accordance with the provisions of the
Companies Act, 2013, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities.
IV. The Directors had arranged preparation of the accounts for the
financial year ended 31.03.2016 on a going concern basis.
V. The Directors had laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and were operating effectively.
VI. 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 REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
STATEMENT
In pursuance of Listing Regulations the Corporate Governance Report and
Management Discussion and Analysis Statement are attached to this
Report. Certificate from the Statutory Auditors of the Company
confirming the compliance with the conditions of Corporate Governance
is also attached to this report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. The details of Internal
financial control and their adequacy are included in the Report of
Management Discussion and Analysis, which forms part of this report.
RATIO OF REMUNERATION TO EACH DIRECTOR
Details / Disclosures of Ratio of Remuneration of Director to the
median employee''s remuneration as required by the Act and Companies
Rules are appended.
SIGNIFICANT & MATERIAL ORDER PASSED BY THE REGULATORS
No significant and material order was passed by any Regulators that
have any impact on the going concern status and the operations of the
Company.
DETAILS REGARDING ISSUE OF SHARES
During the year under review the Company has not issued any shares. The
Company has redeemed 15,00,000, 7% Redeemable Cumulative Non -
Convertible Preference Shares of Rs.100 each, at par.
AUDITORS
M/s. Deloitte Haskins & Sells, Chartered Accountants, Coimbatore, (ICAI
No: 008072S) the Statutory Auditors of the Company retire at the
ensuing Annual General Meeting and are eligible for re-appointment.
AUDITORS REPORT
The Auditor''s Report to the Shareholders does not contain any
qualification.
COST AUDIT
In pursuance of Companies (Cost Records and Audit) Rules, 2014, the
Company has appointed a Cost Auditor for the Company to audit the cost
records for the Financial Year 2016-17.
SECRETARIAL AUDIT REPORT
As required by the Act a Secretarial Audit Report issued by a Company
Secretary in practice is annexed and does not contain any
qualifications and adverse remarks.
EXTRACT OF ANNUAL RETURN
Pursuant to section 92 (3) of the Act and Rule 12 (1) of the Companies
(Management and Administration) Rules, 2014, an extract of annual
return in MGT 9 forms part of this Report.
ACKNOWLEDGEMENT
Your Directors acknowledge with gratitude and express their
appreciation for the assistances and co-operation received from the
Bankers, Government Authorities, Customers, Vendors and Members during
the year under review. Your Directors also wish to thank the employees
at all levels for their co-operation and dedication.
By order of the Board of Directors
Coimbatore K.P. Ramasamy
28.04.2016 Chairman
Mar 31, 2015
Dear Members,
We take pleasure in presenting the Report on our Business and
Operations for the year ended 31st March 2015.
FINANCIAL RESULTS (Rs.in Lakhs)
PARTICULARS STANDALONE
2014-15 2013-14
Sales and Other Income
Domestic Sales (Net of Excise Duty) 1,54,752 1,50,300
Export Sales 48,803 42,851
Other Income 6,682 5,800
2,10,237 1,98,951
Profit before Interest & Depreciation 37,843 38,184
Less : Interest 6,450 7,234
Depreciation 12,587 12,982
Profit Before Tax 18,806 17,968
Less : Taxation
Provision for Current Tax 5,546 5,034
Tax relating to earlier years (82) 94
Less : MAT Credit Entitlement 1,281 -
4,183 5,128
Provision for Deferred Tax Liability 25 (216)
Profit After Tax 14,598 13,056
PARTICULARS CONSOLIDATED
2014-15 2013-14
Sales and Other Income
Domestic Sales (Net of Excise Duty) 1,68,413 1,65,208
Export Sales 80,432 65,844
Other Income 10,134 9,154
2,58,979 2,40,206
Profit before Interest & Depreciation 46,134 45,327
Less : Interest 8,394 10,450
Depreciation 15,402 15,670
Profit Before Tax 22,338 19,207
Less : Taxation
Provision for Current Tax 6,573 5,313
Tax relating to earlier years (95) 87
Less : MAT Credit Entitlement 1,522 135
4,956 5,265
Provision for Deferred Tax Liability 25 (226)
Profit After Tax 17,357 14,168
REVIEW OF OPERATIONS
Indian Textile Industry, one of the key drivers of Indian Economy, is
passing through a positive phase. Our expanded Garment capacity has
joined the mainstream. During the year, production levels at all
segments of textiles have gone up. However, the steep decline in
Cotton prices has impacted the yarn realisation by around 10% over
previous year. The up-trend in demand at the Garment Segment entailed
the Company to achieve the reported Turnover, despite the challenges
faced by the Spinning Segment. Evacuation issue at Power front in the
State still continues. Cost of Power and Labour has gone up due to
increase in Power charges & Minimum Wages by the Government.
Comfortable cash flow enabled the Company to lower working capital loan
and Finance cost. The Company earned a Cash Profit of Rs. 272 Crores
and Cash EPS of Rs. 72 as against Rs. 260 Crores and Rs. 69 in the
previous year. The favourable market trend and the enhanced Garment
capacity would strengthen the prospects of the Company. Competing
countries' higher cost of production would further widen India's stake
at International Market.
DIVIDEND
In its Meeting held on 5th February 2015, Your Board of Directors had
declared an interim dividend of 40% on the Equity Shares of the
Company. The Board has recommended a final dividend of 50% on Equity
Shares, subject to the approval of the Members at the ensuing 12th
Annual General Meeting.
Your Directors have recommended the payment of Dividend of 7% on
Redeemable Cumulative Non-Convertible Preference Shares of Rs. 100
each.
GARMENTS EXPANSION
Driven by consistent demand, the Global Textile & Apparel Trade is
growing rapidly. The core competency enabled Indian Textile Industry to
emerge as the World's second largest Textile Exporter. The uptrend is
expected to remain for a long term. The Garment capacity expansion
mooted during last year has been successfully completed as detailed
below.
BROWN FIELD
The Brown field Garment expansion at our Arasur Garment Facility
upgrading its capacity by 10 million pieces per annum was completed as
scheduled and its Production had commenced from 24th June 2014 onwards.
GREEN FIELD
We are pleased to announce that the Green field Garment expansion at
Thekkalur has also been successfully completed as contemplated. It has
commenced commercial production from March 2015 onwards. These enhanced
our overall Garment Production capacity from 37 Million Pieces to 59
Million Pieces per annum. The increased capacity is fully backed up by
firm orders. The Financial Year 2015-16 shall witness its full-fledged
operations.
FURTHER EXPANSION
To convert its potential into reality, K.P.R. is planning to add a
further large Green field manufacturing facility of 36 Million garments
per annum at an estimated cost of Rs. 175 Crores. With this, the total
garment capacity will become 95 Million garments per annum, one of the
largest in the Country. The project is expected to complete during this
financial year. Considering the impelling orders from the existing
Buyers and the encouraging response from U.S. market, the Board has
considered and accorded its approval to the proposal.
SUBSIDIARY COMPANIES
The Company has the following four Wholly Owned Subsidiary Companies
and the Statements pursuant to Section 129 (3) of the Companies Act,
2013 (Hereinafter referred to as the 'Act') in 'Form AOC- 1' containing
the details of Subsidiaries forms part of this Annual Report. However
as required by the 'Act', we give below a brief report on their
performance.
Quantum KNITS PVT. LIMITED
During the year the Company made a Turnover of Rs. 209.26 Crores and a
Net Profit of Rs. 13.37 Crores.
K.P.R SUGAR MILL LIMITED
Due to the delay in fixation of cane price by the Government for the
Sugar Season 2014-15, the Production had commenced during the month of
December 2014 only. Produced 8.83 Crore units of power, out of which
6.13 Crore units sold and 2.70 Crore units captively consumed. 92,285
metric tonnes sugar was produced.
JAHNVI MOTOR PRIVATE LIMITED
During the year the Company sold 265 cars clocking a revenue of Rs.
113.21 Crores. Considering the enlarged demand for 'Audi' vehicles, the
Company has extended its network at Madurai in Tamil Nadu. It continues
to maintain the 'No.1' position under category 'B' Dealers. New Models
were introduced and market response was good.
GALAXY KNITS LIMITED
The Company has not yet commenced its operation.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from public during the
year under review.
FINANCE
Your Company has been regular in meeting its obligation towards payment
of Principal & Interest. Comfortable cash scenario enabled lesser
Working Capital Loan vis-a-vis Finance Cost.
DIRECTORS
In pursuance of Section 149 and other applicable provisions of the Act
& Clause 49 of the Listing Agreement, Independent Directors were
appointed for a Term at the last Annual General Meeting. Pursuant to
the provisions of the Act and Listing Agreement Dr. S. Ranganayaki,
M.B.B.S., has been co-opted as a Woman Independent Director at the
Meeting of the Board of Directors of the Company held on 12.03.2015,
subject to her appointment at the Annual General Meeting. To regularise
her appointment at the ensuing Annual General Meeting suitable
Resolution has been included in the Notice of the said meeting.
Familiarisation Program on the Company and its operations was conducted
for the Independent Directors. Requisite declaration from the
Independent Directors of the Company under Section 149 (7) of the Act
confirming that they meet with the criteria of their Independence laid
down in Section 149 (6) have been obtained.
Consequent on the cessation of right to appoint a Director in our
Board, as per the Agreement, the Private Equity Investors had withdrawn
their Nominee Director Sri. Shujaat Khan from our Board with effect
from 30.12.2014. The Board wishes to place on record its appreciation
for the valuable services rendered by him during the tenure of his
Directorship.
Sri. C.R. Anandakrishnan, Director retire by rotation at the ensuing
Annual General Meeting and is eligible for reappointment.
The details of the aforesaid Directors, required to be disclosed under
clause 49 of the Listing Agreement, form part of the Notice of the
ensuing Annual General Meeting. Your Directors recommend their
appointment. All the Directors of the Company have confirmed that they
are not disqualified from being appointed as Directors in terms of
Section 164 (2) of the Act.
KEY MANAGERIAL PERSONNEL AND MANAGERIAL REMUNERATION CRITERIA
In pursuance of the Act, Key Managerial Personnel (KMP) for the Company
were appointed. None of the Managing Directors or Whole Time directors
receive any remuneration or commission from the Subsidiary Companies
and the remuneration paid to them is within the purview of the
provisions of Section 197 of the Act. The Company pays remuneration by
way of salary, perquisites, commission (variable component) to its
Chairman, Managing Directors and fixed monthly remuneration to its
Executive Director and Whole Time Director in line with the approvals
accorded by the General Meetings in pursuance of the recommendation of
the Nomination and Remuneration Committee as per the guiding principles
laid down in the Nomination and Remuneration Policy. The information as
required by Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 is appended.
ANNUAL PERFORMANCE EVALUATION
In line with the criteria evolved by the Nomination and Remuneration
Committee, the performance of all Directors, Committees, Chairman etc.,
have been evaluated pursuant to the provisions of the Act and the
Listing Agreement.
COMMITTEES
As required by the provisions of the Companies Act and Listing
Agreement, the Company has already formed the following Committees, the
details of which are disclosed in the Report on Corporate Governance
forming part of this Report.
I. Audit Committee
II. Stake Holders Relationship Committee
III. Nomination and Remuneration Committee
IV. Corporate Social Responsibility (CSR) Committee
POLICIES
In pursuance of the Companies Act, 2013 and the Listing Agreement, the
following policies have been framed and disclosed on the Company's
website 'www.kprmilllimited.com'.
I. Nomination & Remuneration Policy
II. Related Party Transaction Policy
III. CSR Policy
IV. Whistle Blower Policy consisting of Vigil Mechanism
V. Policy on Determining Material Subsidiaries
VI. Code for Fair Disclosure
RISK MANAGEMENT
Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Clause 49
of the Listing Agreement, the Company has framed a Risk Management
Policy. In the opinion of the Board there appears to be no element of
risk which may threaten the existence of the Company.
VIGIL MECHANISM & WHISTLE BLOWER POLICY
The Company has an established Vigil Mechanism for Directors /
Employees to report concerns about unethical behaviors, actual or
suspected fraud, or violation of the code of conduct or ethics policy.
It also provides for adequate safeguards against victimization of
Directors / Employees who avail of the mechanism. The Company affirms
that no personnel have been denied access to the audit committee. The
Company has formulated a Policy of Vigil Mechanism and has established
a mechanism that any personnel may raise Reportable Matters. All
suspected violations and Reportable Matters are reported to the
Chairman of the Audit Committee at e-mail id
'[email protected]'. The key directions / actions will be
informed to the Chairman / Managing Director of the Company.
The Whistle Blower Policy has been framed and displayed in the
Company's Website.
CSR EXPENDITURE
During the year, in pursuance of the recommendations of the CSR
committee, the Company has contributed Rs. 2.32 Crores being 2% of the
average net profit of the Company towards implementing the CSR
activities. Annual Report on CSR, as required by the Act is appended.
BOARD MEETINGS
The Board of Directors met Six times during the financial year on
19.04.2014, 22.05.2014, 04.08.2014, 06.11.2014, 05.02.2015 and
12.03.2015. The Composition of Board, procedure, dates and other
details are included in the Corporate Governance Report that forms part
of this Report.
CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in attaching the Consolidated Financial
Statements pursuant to the provisions of the 'Act' and the Listing
Agreement entered into with the Stock Exchanges. They are prepared in
accordance with the Accounting Standards prescribed by the Institute of
Chartered Accountants of India, in this regard. The Consolidated
Financials also marked a significant increase in its Revenue as well as
Profitability.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has duly complied with the provisions of Section 186 of the
Act and as required therein the details of the Borrowals, Security,
Investment etc., are annexed by way of notes to accounts.
RELATED PARTY TRANSACTIONS
All Related Party Transactions that were entered into during the
financial year were only between Holding Company and Wholly owned
Subsidiary Companies in the ordinary course of business, whose accounts
are consolidated with Holding Company and placed before the shareholder
at the General Meeting for approval. Accordingly, pursuant to Section
134 (3) (h) read with Rule 8 (2) of the Companies (Accounts) Rules,2014
and clause 49 of the Listing Agreement there are no transactions to be
reported under Section 188 (1) of the Companies Act, 2013.
However, the Transactions as required under Accounting Standards AS-18
are reported in Note 31 of the Notes to Accounts of the Consolidated
Financial Statements as well as Standalone Financial Statements of your
Company. The Company's Policy on dealing with related party
transactions is available on the Company's website.
EMPLOYEE WELFARE
Strong and dedicated work force is one of our Key Strengths. The
Company continues to extend exemplary facilities to the Employees.
Their sustained involvement enabled higher productivity and efficiency
with low attrition rate. Their consistent record making ability in
Government examinations evidences the high standard of unique
educational facilities extended by the Company to the Employees.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of
the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 in respect of Employees of the Company, will be provided
upon request. In terms of Section 136 of the Act, the reports and
accounts are being sent to the members and others entitled thereto,
excluding the information on employees' particulars which is available
for inspection by the members at the Registered Office of the Company
during business hours on working days of the Company up to the date of
ensuing Annual General Meeting. If any member is interested in
inspecting the same, such member may write to the Company Secretary in
advance.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013 provides for protection against sexual harassment
of women at workplace and for the prevention and redressal of
complaints of sexual harassment and also for the matters incidental
thereto. The Company has accordingly adopted the policy against Sexual
Harassment of Women at Workplace, for the purpose of preventing,
prohibiting and redressing sexual harassment of female employees at all
the workplace within the Company which are based on fundamental
principles of justice and fair play.
Further, Anti Sexual Harassment Committee has been constituted at each
unit which shall be responsible for redressal of complaints related to
sexual harassment. The details of all such Complaints and its proper
redressal through prompt corrective steps are informed to the Top
Management so as to ensure that suitable processes and mechanisms are
put in place to ensure that issues of sexual harassment, if any, are
effectively addressed. During the year, no complaints of sexual
harassment were received by the Company from any of its Units.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo, as required to be disclosed under
the Act read with the Companies (Accounts) Rules, 2014 are provided in
the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 134(5) of the Companies Act,
2013, the Board of Directors of the Company hereby state and confirm
that;
I. In the preparation of the Annual Accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures.
II. The Directors have selected accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the profit of the
Company for the year under review.
III. The Directors have taken proper and sufficient care for the
maintenance of adequate record in accordance with the provisions of the
Companies Act, 2013, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities.
IV. The Directors have arranged preparation of the accounts for the
financial year ended 31.03.2015 on a going concern basis.
V. The Directors had laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and were operating effectively.
VI. 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 REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
STATEMENT
Corporate Governance Report and Management Discussion and Analysis
Statement are attached to this Report. Certificate from the Statutory
Auditors of the Company confirming the compliance with the conditions
of Corporate Governance as stipulated under Clause 49 of the Listing
Agreement is also attached to this report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. The details of internal
financial control and their adequacy are included in the Report of
Management Discussion & Analysis, which forms part of this report.
RATIO OF REMUNERATION TO EACH DIRECTOR
Details / Disclosures of Ratio of Remuneration of Director to the
median employee's remuneration as required by the Act and Companies
Rules are appended.
SIGNIFICANT & MATERIAL ORDER PASSED BY THE REGULATORS
No significant and material order was passed by any Regulators that
have any impact on the going concern status and the operations of the
Company.
DETAILS REGARDING ISSUE OF SHARES
During the year under review the Company has not issued any shares.
AUDITORS
M/s. Deloitte Haskins & Sells, Chartered Accountants, Coimbatore, (ICAI
No: 008072S) the Statutory Auditors of the Company retire at the
ensuing Annual General Meeting and are eligible for Re-appointment.
AUDITORS REPORT
The Auditor's Report to the Shareholders does not contain any
qualification.
COST AUDIT
In pursuance of Companies (Cost Records and Audit) Rules, 2014, the
Company has appointed a Cost Auditor for the Company to audit the cost
records for the Financial Year 2015-16.
SECRETARIAL AUDIT REPORT
As required by the Act a Secretarial Audit Report issued by a Company
Secretary in practice is annexed.
EXTRACT OF ANNUAL RETURN
Pursuant to section 92(3) of the Act and Rule 12(1) of the Companies
(Management and Administration) Rules, 2014, an extract of annual
return in MGT 9 forms part of this Report.
ACKNOWLEDGEMENT
Your Directors acknowledge with gratitude and express their
appreciation for the assistances and co-operation received from the
Bankers, Government Authorities, Customers, Vendors, Private Equity
Investors and Members during the year under review. Your Directors also
wish to thank the employees at all levels for their co-operation and
dedication.
By order of the Board of Directors
Coimbatore K.P. Ramasamy
05.05.2015 Chairman
Mar 31, 2013
Dear Shareholders,
The are delighted to present the report on our business and operations
for the year ended March 31, 2013.
(Rs. in Lakhs)
FINANCIAL RESULTS STANDALONE CONSOLIDATED
Particulars 2012-13 2011-12 2012-13 2011-12
Sales and Other Income
Domestic Sales (Net
of Excise Duty) 1,18,937 89,346 1,19,225 81,240
Export Sales 27,157 19,493 43,368 39,130
Other Income 3,835 10,427 4,447 6,868
1,49,929 1,19,266 1,67040 1,27238
Profit before
Interest &
Depreciation 36,312 18,376 39,303 18,676
Less : Interest 8,008 4,704 9,803 4,817
Depreciation 14,181 10,362 15,093 10,362
Profit Before Tax 14,123 3,310 14,407 3,497
Less : Taxation
Provision for
Current Tax 2,798 591 2,877 648
Less : MAT Credit
Entitlement 244 590 263 598
Tax relating to
earlier years - 360 12 378
2,554 (359) 2,602 (328)
Provision for Deferred
Tax Liability 1,493 546 1,504 546
Profit After Tax 10,076 3,123 10,301 3,279
REVIEW OF OPERATIONS
Your Company is one of the largest vertically integrated textile
players with presence across the entire value chain from "fibre to
fashion".
During the year under consideration the Company witnessed a good surge
in its top line. Even though the year 2012-13 was marked by a
significant volatility in the National Economy, the Company delivered a
commendable performance. The increase in EBITDA was driven mainly by
growth in sales, stable raw-material pricing and continued optimization
of costs.
Consistent expansion with continuous focus on delivering value added
products at customer acclaimed Quality and recent diversification
activities have started yielding the desired results. The year under
review witnessed establishment of the Melange yarn facility which is a
value added yarn yielding higher margins .Price stability and adequate
availability of Cotton, increased demand for Yarn and Fabrics both at
domestic and international Markets resulted an impressive performance
during the year under review over previous year.
Growing response for our superior quality products in the markets led
to improved profitability. Your Company generated a Cash Profit of Rs.
243 Crores and Cash EPS of Rs. 64 as against Rs. 135 Crores and Rs. 36
in the previous year.
DIVIDEND
Your Board of Directors at their Meeting held on 07.02.2013 had
declared an interim dividend of 30% on the Equity Shares of the
Company. Your Board has recommended a final dividend of 30% on Equity
Shares of the Company, which is subject to approval of the Members at
the ensuing 10th Annual General Meeting
PROJECTS
Melange Yarn Project at Karumathampatti with 16,128 Spindles and
Expansion cum Modernisation at Sathyamangalam were completed.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from public during the
year under review.
FINANCE
Your Company has been regular in meeting its obligation towards payment
of Principal / Interest to Banks.
DIRECTORS
Sri.M.I.Vijayaraaghavan, SriAM.Palanisamy and Sri.C.Thirumurthy,
Directors retire by rotation at the ensuing Annual General Meeting and
are eligible for reappointment.
As required under clause 49 of the Listing Agreement, the brief resumes
of those Directors are furnished in the Notice of Annual General
Meeting.
SUBSIDIARY COMPANIES
The Company has following four Subsidiary Companies with 100%
Beneficial Interest and the Statements pursuant to Section 212 of the
Companies Act, 1956 containing details of Subsidiaries forms part of
this Annual Report.
1. Quantum KNITS PVT. LIMITED 2. K.P.R. Sugar Mill Limited
3. Jahnvi Motor Private Limited 4. Galaxy Knits Limited
COGEN CUM SUGAR PROJECT- K.P.RSUGAR MILL LIMITED:
We are glad to announce that the Cogen Cum Sugar Factory with 30 MW and
5000 TCD respectively, established at Almel Village, Sindagi Taluk,
Bijapur (DT), Karnataka, commenced commercial production from November
2012 onwards. During five months of its maiden year of operations
produced 7.23 Crores units of Power, out of which 5.24 Crores Units
sold and the remaining 1.99 Crores units captively consumed; 66234 MT
of Sugar produced, out of which 8939 MT sold. Adequate availability of
Men, Material and Strategic Management Policies enabled a comfortable
operation in its first year itself.
PREMIUM CAR DEALERSHIP- JAHNVI MOTOR PRIVATE LIMITED
During the year, your company has invested Rs. 1.51 Crores in
M/s.Jahnvi Motors Private Limited. Consequently the said Company has
become our Wholly Owned Subsidiary w.e.f. 30.10.2012.
In view of the general exemption granted by the Central Government vide
its Circular No: 2/2011 dated 8th February, 2011 the Audited Statement
of Accounts, the reports of the Board of Directors and Auditors of the
Subsidiary Companies are not annexed as required under section 212(8)
of the Companies Act, 1956. Shareholders who wish to have a copy of the
full report and accounts of the Subsidiaries will be provided on
receipt of written request from them. These documents will be put up on
the Company''s Website viz. www.kprmilllimited.com and will also be
available for inspection by any Shareholder at the Registered Office of
the Company on any working day during business hours.
CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in attaching the Consolidated Financial
Statements pursuant to Clause 32 of the Listing Agreement entered into
with the Stock Exchanges and prepared in accordance with the Accounting
Standards prescribed by the Institute of Chartered Accountants of
India, in this regard.
The consolidated Financials also marked a significant increase in its
Revenue as well as Profitability.
PARTICULARS OF EMPLOYEES
The information required under Section 217 (2A) of the Companies Act
1956 and the Rules made thereunder, is provided in an Annexure forming
part of this Report. In terms of Section 219 (1) (b) (iv) of the
Companies Act 1956, the Report and Accounts are being sent to
Shareholders excluding the aforesaid Annexure. Any Shareholder
interested in obtaining a copy of the same may write to the Company
Secretary.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo, as required to be disclosed under
section 217(1)(e) of the Companies Act 1956, read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules
1988 are provided in the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 217(2AA) of the Companies
Act, 1956, the Board of Directors of the Company hereby state and
confirm that;
i. In the preparation of the Annual Accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures.
ii. The Directors have selected accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the profit of the
Company for the year under review.
iii. The Directors have taken proper and sufficient care for the
maintenance of adequate record in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities.
iv. The Directors have arranged preparation of the accounts for the
financial year ended March 31, 2013 on a going concern basis.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
STATEMENT
Corporate Governance Report and Management Discussion and Analysis
Statement are attached to this Report.
AUDITORS
M/s.Deloitte Haskins & Sells, Chartered Accountants, Coimbatore, the
Statutory Auditors of the Company retire at the ensuing Annual General
Meeting and are eligible for Re-appointment.
AUDITORS REPORT
The Auditor''s Report to the Shareholders does not contain any
qualification.
COST AUDITOR
The Company has reappointed Sri.B.Venkateswar, B.Sc., ACMA, Coimbatore,
as the Cost Auditor to audit cost accounts for the year ending on
31.03.2014.
INDUSTRIAL RELATIONS
The relationship with employees continued to remain cordial throughout
the year under review.
ACKNOWLEDGMENT
Your Directors acknowledge with gratitude and express their
appreciation for the assistances and cooperation received from the
Bankers, Government Authorities, Customers, Vendors, Private Equity
Investors and Members during the year under review. Your Directors also
wish to thank the employees at all levels for their co-operation and
dedication.
Coimbatore By order of the Board of Directors
2105 2013 K.P. Ramasamy
Chairman
Mar 31, 2012
The Directors have pleasure in presenting the Ninth Annual Report
including the Audited Financial Statements of the Company for the year
ended 31st March 2012.
FINANCIAL RESULTS STANDALONE CONSOLIDATED
Particulars 2011-12 2010-11 2011-12 2010-11
Sales and Other
Income
Domestic Sales 90,265 86,107 82,148 77,980
Export Sales 20,728 15,958 39,454 29,989
Other Income 9,496 3,830 5,949 2,987
1,20,489 1,05,895 1,27551 1,10,956
Profit before
Interest &
Depreciation 18,376 24,887 18,676 25,146
Less : Interest 4,704 3,116 4,817 3,235
Depreciation 10,362 12,568 10,362 12,568
Profit Before Tax 3,310 9,203 3,497 9,343
Tax 187 2,077 218 2,122
Profit After Tax 3,123 7126 3,279 7221
REVIEW OF OPERATIONS
During the year, your Company has successfully installed value- added
capacities of Compact Yarn. The Melange Yarn capacity addition and
modernization of our Sathyamangalam plant is also nearing completion.
Your Company's drive towards 100% self- sufficiency in power is also
on-course through its Co-gen cum Sugar plant at Bijapur.
Your Company achieved a growth in exports of 32% resulting in overall
turnover growth of 15% in a year that witnessed unprecedented
volatility in raw material prices and acute power shortage. Your
Company's efficient operations helped us to close another profitable
year with a Profit after tax of Rs. 32.79 Crores, though at a lower
margin of 2.6%. Your Company earned a Cash profit of Rs. 136 Crores and
Cash EPS of Rs. 36.
DIVIDEND
The Board of Directors at their Meeting held on 14.05.2012 had paid an
interim dividend of 30% on the Equity Shares of the Company. The Board
has recommended a final dividend of 20% on Equity Shares of the
Company, which is subject to the approval of the Members at the 9th
Annual General Meeting.
EXPANSION AND MODERNIZATION
The expansion into higher value products initiated with Compact
Spinning capacity addition has been completed and its commercial
production commenced. Your Company's other value-add project, Melange
Yarn, is expected to be completed by mid July 2012. The modernisation
at Sathyamangalam consisting of replacement of ring frames is nearing
completion.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from public during the
year under review.
FINANCE
Your Company has been regular in meeting its obligation towards payment
of Principal / Interest to Banks.
DIRECTORS
Dr.K.Sabapathy, Sri.K.N.V.Ramani and Sri.G.P.Muniappan, Directors
retire by rotation at the ensuing Annual General Meeting and are
eligible for reappointment.
Resolutions seeking the approval of the Members for the aforesaid
re-appointments are included in the notice calling the ensuing Annual
General Meeting. As required under clause 49 of the Listing Agreement,
the brief resumes of those Directors are also furnished in the said
Notice.
SUBSIDIARY COMPANIES
The Company has two Subsidiary Companies and the Statements pursuant to
Section 212 of the Companies Act, 1956 containing details of
Subsidiaries forms part of this Annual Report.
In view of the general exemption granted by the Central Government vide
its Circular No: 2/2011 dated 8th February, 2011 the Audited Statement
of Accounts, the reports of the Board of Directors and Auditors of the
Subsidiary Companies are not annexed as required under section 212(8)
of the Companies Act, 1956. Shareholders who wish to have a copy of the
full report and accounts of the Subsidiaries will be provided on
receipt of written request from them. These documents will be put up on
the Company's Website viz. www.kprmilllimited.com and will also be
available for inspection by any Shareholder at the Registered Office of
the Company on any working day during business hours.
As regards the 'Cogen cum Sugar Project' implemented by the Subsidiary
M/s.K.P.R. Sugar Mill Limited, its construction activities are in
progress and is expected to be commissioned by October 2012.
CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in attaching the Consolidated Financial
Statements pursuant to Clause 32 of the Listing Agreement with the
Stock Exchanges and prepared in accordance with the Accounting
Standards prescribed by the Institute of Chartered Accountants of
India, in this regard.
PARTICULARS OF EMPLOYEES
The information required under Section 217 (2A) of the Companies Act
1956 and the Rules made there under, is provided in an Annexure forming
part of this Report. In terms of Section 219 (1) (b) (iv) of the
Companies Act 1956, the Report and Accounts are being sent to
Shareholders excluding the aforesaid Annexure. Any Shareholder
interested in obtaining a copy of the same may write to the Company
Secretary.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo, as required to be disclosed under
section 217(1)(e) of the Companies Act 1956, read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules
1988 are provided in the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 217(2AA) of the Companies
Act, 1956, the Board of Directors of the Company hereby state and
confirm that:
i. In the preparation of the Annual Accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures.
ii. The Directors have selected accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the profit of the
Company for the year under review.
iii. The Directors have taken proper and sufficient care for the
maintenance of adequate record in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities.
iv. The Directors have arranged preparation of the accounts for the
financial year ended March 31, 2012 on a going concern basis.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
STATEMENT
Corporate Governance Report and Management Discussion and Analysis
Statement are attached to this Report.
AUDITORS
M/s. Deloitte Haskins & Sells, Chartered Accountants, Coimbatore, the
Statutory Auditors of the Company retire at the ensuing Annual General
Meeting and are eligible for Re-appointment.
COST AUDITOR
In conformity with the General Circular issued by the Ministry of
Corporate Affairs, the Company has appointed Sri.B.Venkateswar, B.Sc.,
ACMA, 31/3-E, Sri Ramakrishna Nagar, Kavundampalayam, Coimbatore - 641
030, as the Cost Auditor to audit cost accounts for the year ending on
31.03.2013.
AUDITORS REPORT
The Auditor's Report to the Shareholders does not contain any
qualification.
INDUSTRIAL RELATIONS
The relationship with employees continued to remain cordial throughout
the year under review.
ACKNOWLEDGMENT
Your Directors acknowledge with gratitude and express their
appreciation for the assistances and co-operation received from the
Bankers, Government Authorities, Customers, Vendors, Private Equity
Investors and Members during the year under review. Your Directors also
wish to thank the employees at all levels for their co-operation and
dedication.
On Behalf of the Board of Directors
Coimbatore K.P. Ramasamy
28.06.2012 Chairman
Mar 31, 2011
The Directors have pleasure In presenting the Eighth Annual Report
together with the Audited Financial Statements of the Companyfor the
year ended 31st March 2011:
CONSOLIDATED FINANCIAL RESULTS Rs. In Lakhs
Particulars 2010-11 2009-10
Sales and Other Income:-
DomesticSales 74,948.04 56,903.84
Export Sales 29,988.84 23,417.07
OtherIncome 6,019.16 3,388.27
1,10,956.04 83,709.18
Profit before Interest* Depreciation 25,145.34 16,717.41
Less: Interest 3,234.56 2,733.25
Depreciation 12,567.54 7,049.73
Profit Before Tax 9,343.24 6,934.43
Less: Taxation:-
Provision for Current Tax 3,275.05 1,185.05
Less: MAT Credit Entitlement - 676.85
3,275.05 508.20
Deferred Tax Charge (1,152.55) 1,382.72
ProfitAfterTax 7,220.74 5,043.51
Add: Balance in Profit &LossAccount 19,764.62 17,642.25
Amount available for Appropriation 26,985.36 22,685.76
Appropriation:
Transfer to General Reserve 712.59 504.35
Interim Dividend 1,130.49 1,507.32
Tax on Interim Dividend 187.76 250.35
Proposed Dividend on Equity Shares 1,130.50 565.24
Tax on proposed Dividend 183.40 93.88
Provision for Dividend on
Preference Shares 61.56 -
Taxon Preference dividend 10.22 -
Surplus Transferred to Balance Sheet 23,568.84 19,764.62
26,985.36 22,685.76
REVIEW OF OPERATIONS
With constant growth in all its activities, your Company could cross a
milestone of achieving more than Rs.1000 Crores Turnover during the
financial year under review. With operations at 90 % capacity
utilization, the Yam Division witnessed a strong traction in its
revenues. Similar trends prevailed in Garment and Processing Divisions
too. Your Companys Export Revenue increased by 28% over last year to
Rs.299.88 Crores, of which around 94% contributed by Garment Division.
These enabled your Company to attain commendable total revenue of
Rs.1109.56 Crores, @ 33% over last years Rs.837.09 Crores registering
an enhanced profitability with EBITDA for Current Year Rs.251.45
Crores, from Rs.167.17 Crores in previous year, an increase of 50%. Net
Profit increased to Rs.72.21 Crores in current year from Rs.50.44
Crores of previous year. Overall improvement in Capacity Utilisation
and the encouraged market conditions enabled the achievement.
DIVIDEND
Considering the better performance and profitability the Board of
Directors in its Meeting held on 29.10.2010 had declared an Interim
Dividend of Rs.3/- per share on the Equity Capital of the Company
absorbing a sum of Rs.13.18 Crores, including tax on Dividend. Taking
into account the prospective business outlook more particularly the
growth in revenue assured by the expanded capacity, your Directors are
glad to recommend a Final Dividend of Rs.3/- per Equity Share (30%)
with a cash outflow of Rs.13.14 Crores (including Tax on Dividend) that
may result in a total Dividend of Rs.6/- per share (60%) for the
financial year 2010-2011. During last year, the Dividend declared was
Rs.5.50/- per share (55%) with a cash outflow of Rs.24.16 Crores
(including Tax on Dividend) Dividend on Preference Share amounts to Rs
0.72 Crore (including tax)
EXPANSION AND MODERNIZATION
The ongoing expansion and modernization projects undertaken
byyourCompany comprise of:
1. Compact Spinning Expansion
As reported last year the Company expands in high margin, high
value-add compact yarn segment. Addition of 1,03,680 spindles with a
total outlay of Rs.310 crores at Karumathampatti utilising the Term
Loan assistance from Banks and the unutilized IPO Funds is in progress.
Around 80% of the civil construction work that was commenced during May
2010, has been completed. 34560 spindles have been installed, in which
10080 spindles were already put in to operation. Commercial production
commenced during April 2011 which is expected to be fully operational
by September 2011. Entire Term Loan availed is eligible for TUF
subsidy.
2. Windmill
Added 25 Wind Mills of 21.25 MW capacity to the present 39.82 MW
thereby enhancing its Wind Power generation capacity to 61.07 MW to
support its Compact Spinning capacity Expansion. The strategic approach
of supplementing all its expansion activities with simultaneous wind
energy capacity addition:
1. Reassures KPR s ability to meet its power requirements through
wind energy
2. Reduces its Power cost significantly
3. Reiterates its commitments towards Green initiatives
3. Modernisation at Sathyamangalam Mill
Through Modernisation cum Expansion plan at an estimated cost of Rs
38.45 Crores at Sathyamangalam, the total Spindles envisaged are
51,456, out of which 21,216 Spindles have been erected during March
2011 and the balance is expected to be completed in a phased manner by
October 2011.
4. Melange Yarn Spinning
Enthused by the domestic and export market demand, the Company has
initiated. Installation of 16,128 Spindles of Melange Yam capacity at
Karumathampatti plant considering the cost and location benefits. The
total cost of the expansion is estimated at Rs 17.72 Crores and average
cost per Spindle will be Rs 11,000 which has leverage of economics. The
unique features of Melange Yam are the natural fiber with excellent
treatment enabling coziness, softness and lively color. Besides
meeting 25% of captive consumption it shall cater to the needs of
market. Around 20% Civil work is completed and the project is expected
to be fully operational by January 2012 in a phased manner.
After completion of the aforesaid projects the total spinning capacity
will rise to 3,53,088 spindles from the existing 212,064 (up 66%)
FUTURE OUTLOOK
Your Company continues to accelerate growth through its focused
approach in higher value- add segments of the textile value chain by
expansion and modernisation. Further, to maintain its self-reliance in
power requirements, additional wind power capacity is added. These new
endeavors promises sustained growth in the years to come enhancing its
profitability and returns.
Contrary to the surge prevailed in most part of the financial year
under review, the prices of cotton vis-a-vis yarn are witnessing sharp
decline. However Your Company believes that this short term trend would
bounce back once the prices stabilize.
With concerted efforts to move deeper into premium margin segments and
strong cost competitiveness, your Company expects to continue to
deliver consistent growth and performance.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from public during the
year under review.
FINANCE
Your Company has been regular in meeting its obligation towards payment
of Principal / Interest to Banks.
DIRECTORS
Mr. C.R.Anandakrishnan and Mr. C. Thirumurthy were appointed as
Additional Directors in the Board Meeting held on 31.01.2011.
Sri.C.R.Anandakrishnan was also appointed as Executive Director in the
said meeting.
The aforesaid Directors and Sri.A.M.Palanisamy who was appointed as a
Director in the casual vacancy on February 22, 2010 will hold offices
upto the date of the ensuing Annual General Meeting of the Company.
Notices under section 257 of the Companies Act, 1956, have been
received from Members proposing their appointment as Directors.
Sri. Shujaat khan and Sri.M.J. Vijayaraaghavan retire by rotation at
the ensuing Annual General Meeting and are eligible for reappointment.
Resolution seeking the approval of the Members for the aforesaid
appointments are included in the notice calling the ensuing Annual
General Meeting. As required under clause 49 of the Listing Agreement,
the brief resumes of the Directors proposed to be appointed /
re-appointed are furnished in the Notice of the Annual General Meeting.
SUBSIDIARY COMPANY
The statement pursuant to Section 212 of the Companies Act, 1956
containing details of Subsidiary of the Company forms part of
thisAnnual Report. In view of the general exemption granted by the
Central Government vide its Circular No: 2/2011 dated 8th February,
2011 the Audited Statement of Accounts,. the reports of the Board of
Directors and Auditors of the Subsidiary Companies are not annexed as
required under section 212(8) of the Companies Act, 1956. Shareholders
who wish to have a copy of the full report and accounts of the
Subsidiary will be provided on receipt of written request from them.
These documents will be put up on the Companys Website viz.
www.kprmilllimited.com and will also be available for inspection by any
Shareholder at the Registered Office of the Company on any working day
during business hours.
PROPOSED FINANCIAL PARTICIPATION:
The Board of Directors in its Meeting held on 30.05.2011, approved
"In-Principle" Financial participation upto Rs.72.50 Crores, to be met
out of internal accruals over 2 years, in K.P.R. Sugar Mills Private
Limited for setting up a Sugar cum Co-gen Project at Bijapur District,
Karnataka. K.P.R. Sugar Mills Private Limited will be a Subsidiary of
your Company and by virtue of this participation there will be access
to 34 MW of Green Power. This along with our existing investments in
wind power will position your Company with an unique distinction of
having 100% Green Power of 95 MW.
SHARE CAPITAL:
As approved in the 7th Annual General Meeting of the Company 15,00,000,
7% Redeemable Cumulative Non-Convertible Preference Shares of Rs.100/-
each were allotted to K.P.R. Developers Limited as a consideration
other than cash.
CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in attaching the Consolidated Financial
Statements pursuant to Clause 32 of the Listing Agreement entered into
with the Stock Exchanges and prepared in accordance with the Accounting
Standards prescribed by the Institute of Chartered Accountants of
India, in this regard.
AUDIT COMMITTEE
TheAudit Committee of the Company comprises of 4 Directors viz.,
Sri.M.J.Vijayaraaghavan-Independent and Non-Executive Director
(Chairman)
Dr. K. Sabapathy- Independent and Non - Executive Director
Sri. G.P. Muniappan - Independent and Non - Executive Director
Sri. P. Nataraj - Non - Independent and Executive Director
AUDITORS REPORT
The Auditors Report to the Shareholders does not contain any
qualification.
PARTICULARS OF EMPLOYEES
The information required under Section 217 (2A) of the Companies Act
1956 and the Rules made thereunder, is provided in an Annexure forming
part of this Report. In terms of Section 219 (1) (b) (iv) of the
Companies Act 1956, the Report and Accounts are being sent to
Shareholders excluding the aforesaid Annexure. Any Shareholder
interested in obtaining a copy of the same may write to the Company
Secretary.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo, as required to be disclosed under
section 217(1 )(e) of the Companies Act 1956, read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules
1988 are provided in the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 217(2AA) of the Companies
Act, 1956, the Board of Directors of the Company hereby state and
confirm that;
i. In the preparation of the Annual Accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures.
ii. The Directors have selected accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the profit of the
Company for the year under review.
iii. The Directors have taken proper and sufficient care for the
maintenance of adequate record in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities.
iv. The Directors have arranged preparation of the accounts for the
financial year ended March 31,2011 on a going concern basis.
CORPORATE GOVERNANCE
Pursuant to clause 49 of the Listing Agreement a Report on Corporate
Governance along with Auditors Certificate of its compliance forms
part of the Annual Report.
MANAGEMENTS DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report as required under the Listing
Agreements with the Stock Exchanges forms part of theAnnual Report.
AUDITORS
M/s.Deloitte Haskins & Sells, Chartered Accountants, Coimbatore, the
Statutory Auditors of the Company retire at the ensuing Annual General
Meeting and are eligible for re-appointment. A certificate under
section 224(1 B) of the Companies Act 1956, has been obtained from
them.
INDUSTRIAL RELATIONS
The relationship with employees continued to remain cordial throughout
the year under review.
ACKNOWLEDGMENT
Your Directors acknowledge with gratitude and express their
appreciation for the assistances and cooperation received from the
Bankers, Government Authorities, Customers, Vendors, Private Equity
Investors and Members during the year under review. Your Directors
also wish to thank the employees at all levels for their co-operation
and dedication.
Coimbatore On Behalf of the Board of Directors
30.05.2011 K.P. Ramasamy
Chairman
Mar 31, 2010
The Directors have pleasure in presenting the Seventh Annual Report
together with the Audited Financial Statements of the Company for the
year ended 31st March 2010:
Particulars 2009-10 2008-09
Sales and Other Income
Domestic Sales 56,903.84 53,809.02
Export Sales 23,417.07 18,008.73
Other Income 3,388.27 3,208.73
83,709.18 75,026.48
Profit before Interest & Depreciation 16,717.41 11,262.33
Less: Interest 2,733.25 3,836.89
Depreciation 7049.73 5,595.44
Profit Before Tax 6,934.43 1,830.00
Less: Taxation
Provision for Current Tax (MAT) 1,185.05 207.34
Less: MAT Credit Entitlement 676.85 2.42
508.20 204.92
Provision for Deferred Tax Liability 1,382.72 588.56
Provision for Fringe Benefit Tax - 26.18
Profit After Tax 5,043.51 1,010.34
Add: Balance in Profit & Loss Account 17642.25 17589.43
Amount available for Appropriation 22,685.76 18,599.77
Appropriation
Transfer to General Reserve 504.35 75.78
Interim Dividend 1,507.32 -
Tax on Interim Dividend 250.35 -
Proposed Dividend 565.24 753.66
Tax on Proposed Dividend 93.88 128.08
Surplus Transferred to Balance Sheet 19,764.62 17642.25
22,685.76 18,599.77
REVIEW OF OPERATIONS
The Rscal 2010 was an Year challenged by severe power cut resulting in
reduced capacity utilisation. Price spiral in cotton, difficult Global
Economy, rise in Labour Cost in line with a jump in legal Minimum wages
etc. However your Company on a Consolidated basis, with its unique
strengths and strategies achieved an impressive Total Revenue of Rs.
837 Crores, 11.6% over last years Rs. 750 Crores and a significant
growth in profitability with EBIDTA for the current year Rs. 167 Crores
from Rs. 112 Crores in previous year, an increase of 49%. Net profit
increased to Rs. 50 Crores in current year from Rs. 10 Crores in the
previous year due to improved product mix and overall increase in
capacity utilization to 80% as against 67% in FY09. The utilisation
levels increased with improved power availability in the State, coupled
with internal power saving initiatives and third party power purchase.
DIVIDEND
In view of appreciable growth in profitability, the Board of Directors
in its meeting held on 16.04.2010 have declared an Interim Dividend of
Rs. 4/- per share on the Equity Capital of the Company absorbing a sum
of Rs. 1757 Crores, including Tax on Dividend. Enthused by the
sustained Textile Market trend your Directors are glad to
recommend a Final Dividend of Rs. 1.50/- per Equity Share with a cash
outflow of Rs. 6.59 Crores (including Tax on Dividend) that may result
in a Total Dividend of Rs. 5.50 per share(55%) for the financial year
2009-10. During last year, the Dividend declared was Rs. 21- per share
(20%) with a cash outflow of Rs. 8.82 Crores (including Tax on
Dividend).
EXPANSION AND MODERNIZATION COMPACT SPINNING
In line with its endeavour to continuously enhance the overall
profitability and shareholders returns, your Company planned to expand
in high margin, high value-add compact yam segment. With its unique
features of low hairiness levels and improved strength, compact yams
demand in the market has gone up with high end product manufacturers
manufacturing premium cotton/knitwear products. In order to meet this
growing demand of compact yam in both international and domestic
markets, your Company has started expansion into 100% compact yam
manufacturing space with plans to add 1,03,680 spindles at a total
estimated cost of Rs. 310 Crores. The capacity addition would take
place adjacent to the existing plant of Karumathampatti in order to
achieve cost and location benefits. The expansion is expected to be
completed by the end of April 2011 in a phased manner. The compact yam
would help your Company to achieve higher productivity and better
realisation with reduction in wastage.
With your approval in the Extra-Ordinary General Meeting held on
30.03.2010, the utilisation of balance IPO proceeds amounting to Rs.
71.03 Crores was revised so as to venture into the expansion of
"Compact Spinning capacity" instead of further expansion of garment and
processing facilities. Financial closure for the balance fund
requirement towards the project has also been completed and the
expansion program is in progress.
Your Company adopts a strategic approach of tying up its expansion
proposal with captive wind energy generation to meet its power
requirements. The above expansion too would be supported by
simultaneous investment in installation of incremental capacity of 24MW
wind mills at an estimated cost of Rs. 128 Crores. The windmill
expansion is expected to be completed by the end of November 2010 in a
phased manner.
SATHYAMANGALAM MILL
To achieve greater productivity, increased efficiency, improved quality
and to meet the growing demand for yarn both at Domestic and
International Markets, it has been decided to modernize the existing
30,240 Spindleage at our maiden Spinning Unit at Sathyamangalam. The
existing Ring frames are replaced with new Ring Frames that yield
better productivity.
It is also proposed to expand the spindleage capacity by adding 17952
spindles of recently launched LR9/AX 1632 spindles with cutting edge
technologies that ensures best quality. The plan for expansion at the
existing unit will reduce the per spindle cost considerably with
minimal cost towards civil construction, infrastructures, managerial
personnel etc.
The Total Outlay of the aforesaid Project is around Rs. 30.45 Crores,
after netting off the sale of old asset for which also the financial
closure with Bank has been established.
sl Expenditure as per utilised upto balance to be Utilised
no. items Prospectus 30th martch 2010 towards Compact Spinning
Expansion videegm
approvaldated 30th
march 2010
1 Expansion of the 1,059.10 661.82 397.28
Apparel facility at
Arasur
2 Setting up a Design 56.00 19.00 37.00
at Arasur Studio
3 Construction of an 712.80 250.00 462.80
additional hostel
facility at Arasur
4 Expansion of the 3,970.20 - 3,970.20
Processing facility at
SIPC0T, Perundurai
5 Investment in knitting 2,595.80 1,483.3 5 1,112.45
facility at Arasur
6 Addition of Balancing 1,381.20 266.46 1,114.74
Equipments for our
spinning facilities
7 General Corporate 2,415.60 2,300.22 115.38
purposes-Normal Capex
8 Issue Expenses 1,111.53 1,21865 -
Total 13,302.23 6,199.50 7102.73
(Rs. in Lakhs)
Fund allocated for Compact Spinning expansion 7102.73
Expenses incurred upto 10.06.2010 towards 1,005.16
Compact Spinning
Balance amount to be utilized towards 6,097.57
Compact Spinning Project
FUTURE OUTLOOK
Your Company has a well planned strategy for sustained growth with
focus on premium products to accelerate its revenues and margins. Your
Company expects to continue strong performance in FY11 also by further
improving capacity utilization across all key divisions. The
utilization for yarn is expected to increase from 80% in FY10 to 90% in
FYll, for garments from 65% to 70% and for processing from 55% to 65%.
This coupled with good recovery in demand globally would set the stage
for strong performance for your Company in comingyears.
The appreciation of Rupee remains a challenge for the Indian Exporters
lowering their edge over other textile nations whose currencies have
not appreciated to the same extent against US dollar. Besides, the
rise in input costs in line with the global trends, the Governments
policies on export of cotton & cotton yarn are also causes of concern
to the Textile Industry. However our key strengths viz, Economized
Labour cost through well motivated Labour force with Social
empowerment, Lower Power cost through Green Energy and Strong
fundamentals with consistent Growth embolden us to march ahead of all
odds.
After implementing the projects envisaged, depending on the Market
requirements, your Company may also scale up the capacities at process
and garmenting divisions. The current capacities have been designed in
a way to allow brownfield expansions at existing sites at an investment
much lower than that for a Greenfield. We intend to double these
capacities with minimal capex once the present facilities reach their
optimum utilization levels, which currently hovers around 55%-65%.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from public during the
year under review.
FINANCE
Your Company has been regular in meeting its obligation towards payment
of Principal / Interest to Banks.
DIRECTORS
Mr. AM. Palanisamy B.Com., RCA was appointed as a Director in the Board
Meeting held on February 22,2010, in the place of casual vacancy caused
by the resignation of Mr. M. Ramji and he holds office upto the date of
the 8th Annual General Meeting.
Mr. G.P. Muniappan and Mr. K.N.V. Ramani retire from the Board on
rotation and are eligible for re-appointment at the forthcoming Annual
General Meeting. The Notice convening the Annual General Meeting
includes the proposals for re-appointment of Directors and their
particulars as required by the Listing Agreement.
SUBSIDIARY COMPANY
During the year under review your Company has promoted a wholly owned
subsidiary in the name of Quantum Knits Private Limited with whom the
Operations and Management of Garment Division at Arasur has been
entrusted. The statement pursuant to Section 212 of the Companies Act,
1956, containing details of subsidiary of the Company, forms part of
this Annual Report.
In view of the exemption received from Central Government vide letter
no. 47/449/2010-CL-lll dated 18.05.2010, the Audited Statement of
Accounts, the reports of the Board of Directors and Auditors of the
Subsidiary Companies are not annexed as required under Section 212(8)
of the Companies Act, 1956. Shareholders who wish to have a copy of the
full report and accounts of the subsidiaries will be provided the same
on receipt of a written request from them. These documents will be put
up on the Companys Website viz. www.kprmilllimited.com and will also
be available for inspection by any Shareholder at the Registered Office
of the Company on any working day during business hours.
CONSOLIDATED FINANCIAL STATEMENTS
Your Directors have pleasure in attaching the Consolidated Financial
Statements pursuant to Clause 32 of the Listing Agreement entered into
with the Stock Exchanges and prepared in accordance with the Accounting
Standards prescribed by the Institute of Chartered Accountants of
India, in this regard.
AUDIT COMMITTEE
The Audit Committee of the Company comprises of 4 Directors viz.,
1) Sri. M.J. Vijayaraaghavan -Independent and Non -
Executive Director (Chairman)
2) Dr. K. Sabapathy -Independent and Non -
Executive Director
3) Sri. G.P. Muniappan* -Independent and Non -
Executive Director
4) Sri. P. Nataraj -Non - Independent and
Executive Director
à Appointed as a Member w.e.f. 0710.2009
AUDITORS REPORT
The Auditors Report to the Shareholders does not contain any
qualification.
PARTICULARS OF EMPLOYEES
The information required under Section 217 (2A) of the Companies Act
1956 and the Rules made thereunder, is provided in an Annexure forming
part of this Report. In terms of Section 219 (1) (b)(iv) of the
Companies Act 1956, the Report and Accounts are being sent to the
shareholders excluding the aforesaid Annexure. Any Shareholder
interested in obtaining a copy of the same may write to the Company
Secretary.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo, as required to be disclosed under
section 217(l)(e) of the Companies Act 1956, read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules
1988 are provided in the Annexure to the Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 217(2AA) of the Companies
Act, 1956, the Board of Directors of the Company hereby state and
confirm that;
i In the preparation of the Annual Accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures.
ii The Directors have selected accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the profit of the
Company for the year under review.
iii The Directors have taken proper and sufficient care for the
maintenance of adequate record in accordance with the provisions of the
Companies Act, 1956, for safeguard the assets of the Company and for
preventing and detecting fraud and other irregularities.
iv The Directors have arranged preparation of the accounts for the
financial year ended March 31,2010 on a going concern basis.
CORPORATE GOVERNANCE
Pursuant to clause 49 of the Listing Agreement a Report on Corporate
Governance along with Auditors Certificate of its compliance forms
part of the Annual Report.
MANAGEMENTS DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report as required under the Listing
Agreements with the Stock Exchanges forms part of the Annual Report.
AUDITORS
M/s.Deloitte Haskins & Sells, Chartered Accountants, Coimbatore the
Statutory Auditors of the Company retire at the ensuing Annual General
Meeting and are eligible for Re-appointment. A certificate under
section 224(1B) of the Companies Act 1956, has been obtained from them.
INDUSTRIAL RELATIONS
The Board congratulates the Management for adding yet another
credential to its accreditations by securing TUV Rheinland STAR rating
for -SIMA - Code of Discipline for Women Employment Certification of
Excellence for one of its Units. The excellent facilities and
amenities provided to the Employees by the Company are acclaimed as one
of the best and set precedence in the Textile Industry. Besides, it
secures a sense of satisfaction by fulfillment of its Corporate Social
Responsibility too.
The relationship with employees continued to remain cordial throughout
the year under review
ACKNOWLEDGMENT
Your Directors acknowledge with gratitude and express their
appreciation for the assistances and co-operation received from the
Bankers, Government Authorities, Customers, Vendors, Private Equity
Investors and Members during the year under review. Your Directors also
wish to thank the employees at all levels for their co-operation and
dedication.
On Behalf of the Board of Directors
Coimbatore K-P- Ramasamy
28.06.2010 Chairman
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