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Directors Report of Modi Naturals Ltd.

Mar 31, 2014

Dear Members,

The Directors hereby present the 40th Annual Report and Audited Accounts of the Company for the Financial Year ended on March 31, 2014.

PERFORMANCE

The summarized financial results for the year ended March 31, 2014 and for the previous year ended March 31, 2013 are as follows.

(Rs. in Lacs)

2013-14 2012-13

Sales and Other Income 20982.52 19456.11

Profit before interest and depreciation 448.33 584.81

Interest 142.75 142.75

Profit before Depreciation and Tax 305.58 442.06

Depreciation 141.67 136.82

Profit before Taxation 163.91 305.24

Provision for Taxation 39.73 70.55

Short provision for Taxes for earlier years 5.31 0.73

Provision for Deferred Tax 36.60 30.65

Profit after Taxation 82.27 203.31

Balance brought forward from previous year 810.25 606.94

Amount available for appropriation 82.27 203.31

Appropriation

Surplus carried to Balance Sheet 892.52 810.25

DIVIDEND

The Directors do not recommend any dividend for the year under review.

DIRECTORS

Shri Anil Modi, Chairman & Managing Director and Shri Akshay Modi, Executive Director retire by rotation at the ensuing Annual General Meeting, and, being eligible, offers himself for re-appointment.

The Board has recommended to fix the term of Shri Sudhir Shankar Halwasiya, Shri Alok Garg and Shri Sulabh Singal ,the existing Independent Directors of the Company upto March 31. 2019.The Board has also recommended re-appointment of Shri Anil Modi as Managing Director for a further term of five years with effect from January 1, 2015. The particulars of Directors proposed to be appointed/re-appointed, as the case may be, are given in the Corporate Governance Report of this Annual Report.

DEPOSITS

There are no unclaimed deposits and the Company has not accepted any new deposits during the year under review.

AUDITORS

Messrs K. K. Jain & Co., Chartered Accountants, New Delhi , Statutory Auditors of the Company, holds office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Board of Directors recommend to the Members of the Company for the reappointment of Messrs. K. K. Jain & Co., Chartered Accountants, as Statutory Auditors of the Company to hold the office for a term of three years from the conclusion of ensuing 40th Annual General Meeting of the Company till the conclusion of 43rd Annual General Meeting of the Company.

ACCOUNTS AND AUDIT REPORT

There are no qualifications made by the Auditors in their Report which requires any explanation from the Board of Directors of the Company. The Notes to Accounts referred to in the Auditors'' Report are self-explanatory and do not call for any further comments.

COST AUDITORS

Based on the Audit Committee recommendations at its meeting held on May 30, 2014 and subject to approval by Central Government, the Board recommends the appointment of M/s. Manisha Taiyal & Associates as the Cost Auditors of the Company for the year ended on March 31, 2015.

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

The particulars, as prescribed under sub-section 1(e) of Section 217 of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are given in the Annexure which forms part of this report.

PARTICULARS OF EMPLOYEES

During the year, there were no employees who were in receipt of remuneration more than the limits prescribed under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

PERSONNEL

Identifying employees with high potential to grow and grooming them for competitive positions has been a constant effort of your Company. Your Company aims to be a preferred employer in the industry and remains committed to developing its employees to meet the current and future challenges of the business.

DIRECTORS'' RESPONSIBILITY STATEMENT

In compliance of Section 217(2AA) of the Companies Act, 1956, as amended by the Companies (Amendment) Act, 2000, the Directors of your Company hereby confirm that:

a) the applicable Accounting Standards have been followed in the preparation of final accounts and that there are no material departures;

b) such accounting policies have been selected and applied consistently and the judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at March 31, 2014 and of the profit of your Company for the year ended on that date;

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

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

CORPORATE GOVERNANCE

Your Company has complied with the requirements and disclosures that have to be made under the Code of Corporate Governance as required under Clause 49 of the Listing Agreement entered into with the BSE Limited (BSE) (the "Stock Exchange"). As a listed company, necessary measures are taken to comply with the Listing Agreement with the Stock Exchange. A report on Corporate Governance, along with a certificate of compliance from the Statutory Auditors, forms part of this Annual Report. The Chairman & Managing Directors'' declaration regarding compliance with ''Modi Naturals Limited Code of Conduct for Board Members and Senior Management'' is attached to the Corporate Governance Report.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis is presented in a separate section, which forms part of the Annual Report.

ACKNOWLEDGEMENTS

The Board of Directors take this opportunity to thank all its Shareholders, valued customers, banks, Government and Statutory Authorities, Investors and the Stock Exchange for their continued support to the Company. Your Directors also wish to place on record their deep sense of appreciation for the committed services by your Company''s employees. Your Directors acknowledge with gratitude the encouragement and support extended by our valued Shareholders and the Promoters of the Company.

On behalf of the Board of Directors

sd/- New Delhi (Anil Modi) July 8, 2014 Chairman & Managing Director


Mar 31, 2013

To the Members,

The Directors hereby present the 39th Annual Report and Audited Accounts of the Company for the Financial Year ended on March 31, 2013.

PERFORMANCE

The summarized fnancial results for the year ended March 31, 2013 and for the previous year ended March 31, 2012 are as follows: -

(Rs.in Lacs)

2012-13 2011-12

Sales and Other Income 19456.11 16683.19

Proft before interest and depreciation 584.82 346.50

Interest 142.76 157.85

Proft before Depreciation and Tax 442.06 188.65

Depreciation 136.82 137.82

Proft before Taxation 305.50 50.83

Provision for Taxation 70.55 12.49

Short provision for Taxes for earlier years 0.73

Provision for Deferred Tax 30.65 19.15

Proft after Taxation 203.31 19.19

Balance brought forward from previous year 606.94 587.75

Amount available for appropriation 203.31 19.19

Appropriation

Surplus carried to Balance Sheet 810.25 606.94

DIVIDEND

The Directors do not recommend any dividend for the year under review.

DIRECTORS

Shri Sudhir Shankar Halwasiya, retires by rotation at the ensuing Annual General Meeting, and, being eligible, ofers himself for re-appointment. Shri Sulabh Singal was inducted as an Additional Director on the Board with efect from July 30, 2013. His ofce as Additional Director will expire at the ensuing Annual General Meeting. Your Directors recommend appointment of Shri Sudhir Shankar Halwasiya and Shri Sulabh Singal as Directors of the Company.

The Board has recommended revision in the remuneration of Shri Anil Modi, Managing Director and Shri Akshay Modi, Executive Director of the Company with efect from October 1, 2013 for the remainder of their tenure. The Board has also recommended re-appointment of Mr Akshay Modi for a further term of three years with efect from December 15, 2013.

DEPOSITS

The Company has renewed the deposits and there are no unclaimed deposits during the year.

AUDITORS

M/s. K. K. Jain & Co., Chartered Accountants were the statutory auditors of the Company for the year ended on March 31, 2013. They retire at the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. M/s K.K.Jain & Co. have indicated their willingness to be re-appointed as Statutory Auditors of Company. The Board recommends their re-appointment as Statutory Auditors of the Company.

ACCOUNTS AND AUDIT REPORT

There are no qualifcations made by the Auditors in their Report which requires any explanation from the Board of Directors of the Company.

COST AUDITORS

Based on the Audit Committee recommendations at its meeting held on May 30, 2013, the Company has appointed M/s. Manisha Taiyal & Associates as the Cost Auditors of the Company for the year ended on March 31, 2014.

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

The particulars, as prescribed under sub-section 1(e) of Section 217 of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are given in the Annexure which forms part of this report.

PARTICULARS OF EMPLOYEES

During the year, there were no employees who were in receipt of remuneration more than the limits prescribed under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended from time to time.

PERSONNEL

Identifying employees with high potential to grow and grooming them for competitive positions has been a constant efort of your Company. Your Company aims to be a preferred employer in the industry and remains committed to developing its employees to meet the current and future challenges of the business.

DIRECTORS'' RESPONSIBILITY STATEMENT

In compliance of Section 217(2AA) of the Companies Act, 1956, as amended by the Companies (Amendment) Act, 2000, the Directors of your Company hereby confrm that:

a) the applicable Accounting Standards have been followed in the preparation of fnal accounts and that there are no material departures;

b) such accounting policies have been selected and applied consistently and the judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of afairs of your Company as at March 31, 2013 and of the proft of your Company for the year ended on that date;

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

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

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with Stock Exchanges, Reports on Management Discussion and Analysis and on Corporate Governance have been included elsewhere in this Report as separate sections. A certifcate from M/s K K Jain & Co., Chartered Accountants confrming compliance with Clause 49 of the Listing Agreement has also been included in the Annual Report. Further, as required under the Clause 49, your Company has adopted a ''Code of Conduct and Ethics for its Directors and Senior Executives''.

ACKNOWLEDGEMENTS

The Directors'' express their gratitude to the employees of the Company for their commitment, dedication and support in fulflling Company''s commitments to its customers and thereby contributing to the performance of the Company. They would also like to express their gratitude to various Government/ Regulatory authorities, customers, vendors, Banks and members for their continued understanding and support during the Financial Year ended on March 31, 2013 and look forward to the same in the years to come.

On behalf of the Board of Directors sd/-

Place : New Delhi (Anil Modi)

Date : August 30, 2013 Chairman


Mar 31, 2012

To the Members,

The Board of Directors hereby presents the 38th Annual Report on the business and operations of your Company along with the Audited Financial Statements for the year ended 31st March, 2012.

PERFORMANCE

The summarized financial results for the year ended 31st March, 2012 and for the previous year ended 31st March, 2011 are as follows: -

(Rs. in Lacs) 2011-12 2010-11

Sales and Other Income 16683.19 11090.41

Profit before interest and depreciation 346.50 246.85

Interest 157.85 126.20

Profit before Depreciation and Tax 188.65 120.65

Depreciation 137.82 118.02

Profit before Taxation 50.83 2.63

Provision for Taxation 12.49 1.86

Short provision for Taxes for earlier years - 0.49

Provision for Deferred Tax 19.15 (3.63)

Profit after Taxation 19.19 3.91

Balance brought forward from previous year 587.75 583.84

Amount available for appropriation 606.94 587.75

Appropriation

Surplus carried to Balance Sheet 606.94 587.75

DIVIDEND

The Directors do not recommend any dividend for the year under review.

CORPORATE GOVERNANCE

Report on the Corporate Governance along with the certificate of the Auditors, confirming compliance of condition of Corporate Governance as stipulated under Clause 49 of the Listing Agreement, forms part of the Annual Report.

DIRECTORS

Out of the present Directors, Shri Alok Garg, retires by rotation, and, being eligible, offers himself for re-appointment. Your Directors recommend re-appointment of Shri Alok Garg as Director on the Board.

DEPOSITS

The Company has not accepted any fresh deposits during the year.

AUDITORS

The present Auditors M/s. K. K. Jain & Co., Chartered Accountants retire at the conclusion of the Annual General Meeting. They have furnished a certificate u/s 224(1 B) of the Companies Act, 1956 and are eligible for re-appointment. Your Directors recommend re-appointment of M/s K. K. Jain & Co., as Auditors of the Company at the ensuing Annual General Meeting of the company.

ACCOUNTS AND AUDIT REPORT

There are no qualifications made by the Auditors in their Report which requires any explanation from the Board of Directors of the Company.

COST AUDITORS

The Ministry of Corporate Affairs (MCA) has introduced The Companies (Cost Audit Report) Rules, 2011 vide its notification no. GSR 430(E) dated June 3, 2011. These rules make it mandatory for industries to appoint a Cost Auditor within 90 days of the commencement of the Financial Year. The Cost Audit Order No. 52/26/CAB/2010 dated January 24, 2012 covers your Company's manufacturing operations w.e.f. April 1, 2012. Based on the Audit Committee recommendations at its meeting held on February 9, 2012, the Board has appointed M/s Manisha Taiyal & Associates as the Cost Auditors of the Company for the Financial Year 2012-2013.

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

Information required to be furnished in terms of 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 relating to Conservation of Energy, Technology Absorption & Foreign Exchange Earnings & outgo is annexed herewith & forms part of this report.

GREEN INITIATIVE

Your Company wishes to be a part of green initiative of the Ministry of Corportate Affaires (MCA) so as to contribute towards a greener environment. Your Company proposes to send its annual report and other communications electronically to its shareholders and to enable your Company to do so, it is requested that shareholders may kindly fill in their e-mail ID details (in an enclosure annexed to this Annual Report) and send it back to the Company Secretary / Registrar and Share Transfer Agent of the Company.

PARTICULARS OF EMPLOYEES

During the year there were no employees who were in receipt of remuneration more than the limit prescribed under Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees ) Rules, 1975 as amended.

PERSONNEL

The relations with the employees of the Company continued to be cordial. Your Directors wish to place on record their appreciation for the excellent work done by the employees at all levels.

DIRECTORS' RESPONSIBILITY STATEMENT

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

a) in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

b) they have, in the selection of the Accounting policies, consulted the Statutory Auditors and have 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 that period;

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

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

ACKNOWLEDGEMENTS

Your Directors express their sincere gratitude and deep appreciation for the co-operation and assistance given by the financial institutions, banks, suppliers and customers of the Company during the year under report and look forward to their continued support. Your Director's also thankfully acknowledge the trust and confidence reposed by you in the Company.

On behalf of the Board of Directors

sd/-

Place : New Delhi (Anil Modi)

Date : September 4, 2012 Chairman








Mar 31, 2010

The Directors have pleasure in presenting the 36th Annual Report of the Company together with the Audited Accounts for the yearended 31st March, 2010.

OPERATING RESULTS

The summarized financial results for the yearended 31st March, 2010 and for the previous yearended 31st March, 2009 are

as follows: -

(in Lacs)

2009-10 2008-09

Turnover 11580.85 12091.47

Profit before interest and depreciation 403.45 595.69

Interest 136.73 105.96

Depreciation 107.21 78.13

Profit for the year 159.49 411.60

The turnover of the company has gone down from Rs 120.91 croresto Rs 115.81 crores. However, the companys Rice Bran processing has gone up by 12% i.e. from 70857 tons to 79224 tons. The decrease in turnover is actually on account of increase in stock of Finished Goods (from Rs 9.04 crores to Rs 13.08 crores) and fall in Indian edible oil commodity prices.The main reason for a fall in edible oil prices is excessive dumping of vegetable oil market by cheap imported oils - mainly crude palm oil. This has also resulted in decrease of Net Realizable Value of Refined Rice Bran oil by 13% over last year.

On the other hand, the prices of raw materials i.e. mainly Rice Bran have not gone down as significantly as oil prices, resulting in decrease in Gross Profit margin.

OPERATIONS

In the last 2 years, the company has invested over Rs 10 crores for upgrading its production facilities and also setting up new packaging lines. As a result of this there is an increase in financing (from Rs 1.17 crores to Rs 1.47 crores) and depreciation costs (from Rs 0.78 crores to Rs 1.07 crores). The companys new business division called Branded Business has resulted in increase in personnel (from Rs 2.17 crores to Rs 2.66 crores) & administrative expenses (from Rs 0.49 crores to Rs 0.87 crores) of the company. As a result, the companys profit has gone down in current year. However, the benefits of these investments shall occur in coming years.

FOREIGN INSTITUTIONAL INVESTORS

Pursuant to Foreign Investment Promotion Board (FIPB) approval, 26,40,000 optionally convertible warrants have been issued on preferential basis to three Flls on 5,h August 2010. After the conversion of these warrants into equity shares, the paid up capital of the company shall become Rs 11,11,79,340.

GOING FORWARD

The company has structured its operations into three divisions - Branded Business, Bulk Commodities and Value Added Products. The new structure will refocus your companys efforts, unlock embedded value and result in accelerated growth on all fronts. Adetailed report on this is given in the CEOs message.

DIVIDEND

In order to conserve the resources for the growth of the company, the Directors do not recommend any dividend for the year under review.

CORPORATE GOVERNANCE

Report on the Corporate Governance along with the certificate of the Auditors, confirming compliance of condition of corporate governance as stipulated under Clause 49 of the Listing Agreement, forms part of the Annual Report.

DIRECTORS

Out of the present Directors, Shri Alok Garg, retires by rotation, and, being eligible, offers himself for re-appointment. Your Directors recommend re-appointment of Shri Alok Garg on the Board.

DEPOSITS

The company has not accepted any fresh deposits during the year. There were no overdue deposits.

AUDITORS

The present Auditors Messrs K. K. Jain & Co., Chartered Accountants retire at the conclusion of the Annual General Meeting. They have furnished a certificate u/s 224(1 B) of the Companies Act, 1956 and are eligible for re-appointment. Your Directors recommend re-appointment of M/s K.K.Jain & Co., as auditors of the Company at the ensuing Annual General Meeting.

ACCOUNTS AND AUDIT REPORT

The Auditors comment in their Auditors Report at para 3 (vi) along with the management reply is as follows:-

In our opinion and to the best of our information and according to the explanations given to us, the Balance Sheet and the Profit & Loss Account read with the Schedules and Notes thereon and subject to the consequential impact on the result for the year of Note No. B6 of Schedule 23 regarding non-disclosure of additional information required under clause 22 of Chapter V of Micro, Small and Medium Enterprises Development Act, 2006 give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

The company has not been able to provide disclosure of additional information as required under clause 22 of Chapter V of Micro, Small and Medium Enterprises Development Act, 2006 due to non receipt of any intimation from its suppliers regarding their status under The Micro, Small and Medium Enterprises Development Act, 2006 and hence the following information required under the said Act could not be provided by the company :-

a) Delayed payments due as at the end of each accounting year on account of principal and interest thereon.

b) Total interest paid on all delayed payments during the year under the provisions of the Act.

c) Interest due on principal amounts paid beyond the due date during the year but without the interest amounts under the act.

d) Interest accrued but not due.

e) Total interest due but not paid.

It may be noted that the company generally makes payment to all its suppliers with in the agreed credit period (less than 45 days) and thus the management is confident that liability of interest under this Act, if any, would not be material.

In response to a Auditors observation at point No. 6 of the Annexure to the Auditors Report, it may be noted that due to inadvertent omission, the return of deposits of the company for the year ended 31 March, 2010 could not be deposited within the stipulated time period. However, the same is being deposited with the Registrar of Companies and Reserve Bank of India.

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

Information required to be furnished in terms of 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 relating to Conservation of Energy, Technology Absorption & Foreign Exchange Earnings & outgo is annexed herewith & forms part of this report.

DIRECTORSRESPONSIBILITY STATEMENT

In terms of Sec. 217(2AA) of the Companies Act, 1956, the Directors state that>

a. In the preparation of the annual accounts, the applicable accounting standards have been followed.

b. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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.

c. The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d. The Directors have prepared the annual accounts on a going concern basis.

PARTICULARS OF EMPLOYEES

During the year there were no employees who were in receipt of remuneration more than the limit prescribed under Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of employees) Rules, 1975 as amended.

PERSONNEL

The relations with the employees of the Company continued to be cordial. Your Directors wish to place on record their appreciation for the excellent work done by the employees at all levels.

ACKNOWLEDGEMENTS

Your Directors express their sincere gratitude and deep appreciation for the co-operation and assistance given by the financial institutions, banks, suppliers and customers of the Company during the year under report and look forward to their continued support. Your Directors also thankfully acknowledge the trust and confidence reposed by you in the company.

For and on behalf of the Board of Directors

sd/-

Place: New Delhi Anil Modi

Date: 04.09.2010 Chairman



 
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