Mar 31, 2016
Note:
(a) Interest rate on short term borrowings varies from 10.75% to 17.25% p.a (previous year 10.75% to 12% p.a).
(b) Short term loans outstanding as at March 31,2016 are further secured by as per below:
(i) Pledge of 100% shareholding (67,420,141 number of shares) of the promoters of the Company.
(ii) Personal guarantee of Mr. Deepak Puri and Mrs. Nita Puri.
(iii) Negative lien on land of Moser Baer Infrastructure and Developers Limited at Chennai on pari passu basis.
(iv) Corporate guarantee of Moser Baer Infrastructure and Developers Limited (subsidiary of the company that owns the rights to the Chennai land).
(v) Pledge of shares of Moser Baer Infrastructure and Developers Limited.
* Warranty provision relate to the estimated outflow in respect of warranty for products sold by the Company. Due to very nature of such costs, it is not possible to estimate the timing/uncertainties relating to their outflows as well as expense from such estimates
** As per notification no. 22/2006 of Central Excise, the Company has to pay additional custom duty on its local sales, if the goods sold are exempted from payment of sales tax or value added tax. One of the units of the Company is exempt from payment of local sales tax and hence the department has disputed the same and demanded the duty on the sale of such goods. The Company has contested this matter and the dispute is currently pending at CESTAT and Commissioner of Custom and Central Excise forum and final demand order has not been raised till now. Pending the final outcome of the dispute with authorities, the Company has recorded the provision for the amount demanded by the authorities on prudence basis and is accruing the interest on it on quarterly basis. Due to very nature of such costs, it is not possible to estimate the timing / uncertainties relating to their outflows as well as expense from such estimates, hence considered as short term in nature.
Note:
As per the Corporate Debt Restructuring scheme ("CDR") approved in the year ended March 31, 2013, Company recorded amounts receivable from banks on account of installment paid prior to implementation of corporate debt restructuring, excess interest paid by the Company and release of additional limits as per the scheme. As of March 31, 2016, a total of Rs. 412,853,875 (previous year Rs. 412,853,875) is outstanding to be received from the banks. As the Company is still under CDR, no adjustment is made to the amount recoverable from banks.
1. Contingent liabilities
(a) Corporate guarantees given on behalf of the subsidiary companies: Rs. 20,518,700,000 (previous year Rs. 20,518,700,000). Against these guarantees, loans aggregating Rs. 19,060,818,131 (previous year Rs. 17,207,912,525) have been availed by the subsidiary companies.
The Company is involved in taxation disputes that arise from time to time in the ordinary course of business. Based on internal assessment and discussion with experts, management is of the view that above claims are not tenable and will not have any material adverse effect on the Company''s financial position and results of operations.
(c) Other claims against the Company not acknowledged as debts: Rs. 345,900 (previous year Rs. 345,900).
(d) Outstanding letters of credit opened by banks on behalf of the Company: Rs. 29,390,649 (previous year Rs. 37,247,363 ).
(e) Bonus payable for the period of April 1, 2014 to March 31, 2015 pursuant to retrospective amendment in Bonus Act : Rs. 5,465,257 (previous year Nil). Since the matter is subjudice and various high courts have given stay order against retrospective amendment, it has been considered as contingent liability.
(f) Recompense amount payable in lieu of bank sacrifice (mandatory disclosure as per RBI): Rs. 1,980,042,904 (previous year Rs.1,581,305,158).
The amount shown in (a) above represents guarantees given in the normal course of the Company''s operations and are not expected to result in any loss to the Company on the basis of the beneficiary fulfilling its ordinary commercial obligations.
The amounts shown in (b) and (c) above represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on the outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be estimated accurately. The Company engages reputed professional advisors to protect its interests and has been advised that it has strong legal positions against such disputes.
(g) In respect of the outstanding foreign currency convertible bonds (FCCBs), bondholders have claimed interest for the period beyond the original date of redemption. As explained in more detail in Note 48, the Company is in the process of negotiating restructuring of these bonds. Management expects to restructure these bonds by extension of the redemption date as prescribed by the Reserve Bank of India. Contingent liability in respect thereof can''t be estimated reliably.
2 Capital commitments
Estimated value of contracts remaining to be executed on capital account and not provided for (net of advances): Rs. 185,969,581 (previous year Rs. 177,722,251).
3 (a) Lease obligations
The Company has entered into operating leases for its offices and utilities that are renewable on a periodic basis and are cancellable at Company''s option. Total lease payments recognized in the statement of profit and loss with respect to aforementioned premises is Rs. 569,421,401 (previous period Rs. 527,422,277). The total rent recovered on sub lease during the year is Nil (previous year Rs. 29,730,645).
(b) Assets given on finance lease
The Company has given buildings and utilities on financial lease to units operating in its SEZ division.
Buildings are given on lease for a period of 20 years and utilities are given for a period of 7-10 years. Apart from the regular lease rental the Company has also taken interest free refundable security deposits of Rs. 1,605,000,000 ( previous year Rs 1,605,000,000) from the lessees which is refundable at the end of the lease term.
4. Taxation
Provision for taxation has not been made in the absence of assessable taxable income as per the Income Tax Act,1961.
As per para 15 and 17 of Accounting Standard 22, "Accounting for Taxes on Income", deferred tax assets should be recognized and carried forward only to the extent that there is a reasonable /virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. Deferred tax assets have not be recognized in view of the accumulated losses and in absence of reasonable / virtual certainty to absorb the losses in future.
5. Derivative instruments
The Company uses forward exchange contracts to hedge against its foreign currency exposures relating to the underlying transactions and firm commitments. The Company does not enter into any derivative instruments for trading or speculative purposes.
(a) There is no forward exchange contracts outstanding as at March 31, 2016.
(b) The foreign currency exposures not hedged as at year end as at March 31, 2016 are as under:
6. Related party transactions:
In accordance with the requirements of Accounting Standard - 18 ''Related Party Disclosures'' the names of the related party where control/ability to exercise significant influence exists, along with the aggregate amount of transactions and period end balances with them as identified and certified by the management are given below:
(a) Names of related parties
Subsidiary Companies
European Optic Media Technology GmbH
Moser Baer Distribution Limited (formerly known as Moser Baer SEZ Developer Limited)
Solar Research Limited
Moser Baer Laboratories Limited (formerly Moser Baer Energy Limited)
Moser Baer Entertainment Limited Moser Baer Investments Limited
Photovoltaic Holdings Limited (formerly Photovoltaic Holdings PLC)
MB Solar Holdings Limited (formerly Moser Baer Solar PLC)
Moser Baer Solar Limited (formerly known as Photovoltaic Technologies India Limited)
Helios Photo Voltaic Limited (formerly Moser Baer Photo Voltaic Limited)
Perafly Limited Nicofly Limited Peraround Limited Advoferm Limited Cubic Technologies BV*
TIFTON Limited
Value Solar Energy Private Limited Pride Solar Systems Private Limited Admire Energy Solutions Private Limited
Moser Baer Solar Systems Private Limited (formerly Arise Solar Energy Private Limited)
Competent Solar Energy Private Limited OM&T B.V**
Moser Baer Technologies Inc.***
Moser Baer Infrastructure and Developers Limited Moser Baer Photovoltaic Inc. USA****
Associate
Global Data Media FZ LLC Moser Baer Infrastructure Limited Solar Value Proizvodjna d.d.
7. Segment information
The Company is primarily in the business of manufacture and sale of Optical Storage Media. The other activities of the Company comprise creation/ replication and distribution of content, sales of consumer electronic products and operations and maintenance of sector specific Special Economic Zone for non-conventional energy. As the single financial report contains both consolidated financial statements and the separate financial statements of Moser Baer India Limited (the parent), segment information has been presented only on the basis of consolidated financial statements of the period ended March 31, 2016.
8. Employee benefits
The Company has classified the various benefits provided to employees as under:
* Included in contribution to provident and other funds under employees benefits expenses (refer note 27)
B Defined benefit plans
(i) In accordance with Accounting Standard 15, the liability in respect of defined benefit plans, namely gratuity and unveiled earned leaves has been determined based on actuarial valuation based on the following assumptions:
The expected contribution on account of gratuity for the year ending March 31, 2017 cannot be ascertained at this stage.
In respect of the employee''s gratuity fund, constitution of plan assets is not readily available from the Life Insurance Corporation of India.
Premium payable on redemption of FCCB accrued up to March 31, 2016 amounting to Rs. 4,983,850,363 (previous year ended December 31,2014 Rs. 3,879,418,653) has been fully provided for and charged to securities premium account. In the event that the conversion option is exercised by the holders of FCCB in the future, the amount of premium charged to the securities premium account shall be written back to security premium account.
(c) The Company has outstanding foreign currency convertible bonds (FCCBs) with principal value of USD 88,400,000 equivalent to Rs 5,857,384,000 (previous year ended 31 December 2014 USD 88,500,000 equivalent to Rs 5,579,040,000) which were due for redemption along with premium on June 21, 2012. As at March 31, 2016, accrual for premium on FCCB aggregates Rs 4,983,850,363. The company is in the process of negotiation with the bondholders to re-structure the terms of these bonds; these negotiations have progressed and the Company has applied to the Reserve Bank of India ("RBI") for requisite approvals.
(d) During the year, the Company has issued 9,879 equity shares of Rs 10 each upon conversion of 6.75% Tranche B Foreign Currency Convertible Bonds (FCCBs) of principal amount of USD 100,000 to one of the bondholder out of the total of USD
9. million outstanding as at December 31, 2014. Post the conversion, Tranche B FCCBs aggregating to USD 42.9 million and Tranche A FCCBs aggregating to USD 45.5 million are outstanding as at March 31, 2016.
10. Based on the information available with the Company, the Company has identified 32 vendors as micro, small and medium enterprises as defined in the Micro, Small and Medium Enterprises Development Act, 2006. The balance due to such vendors has been disclosed separately under trade payables.
11. Impairment of investments
Management performed a detailed impairment assessment (using an independent valuer) as at March 31, 2016 for its investments in and advances/other receivables from certain subsidiaries, viz. Moser Baer Solar Limited ("MBSL"), Photovoltaic Holdings Limited, Moser Baer Investments Limited, Helios Photo Voltaic Limited ("HPVL") and Moser Baer Entertainment Limited ("MBEL") to determine if there is any other than temporary diminution in the values of these investments and if outstanding advances or other receivables are recoverable. This analysis for certain subsidiaries involved use of material estimates and judgments related to future business projections which, amongst other factors, are dependent on the acceptance of revised restructuring with lender banks, ramping up operations with adequate advance from customers, external market conditions of the solar market and regulatory benefits. Basis the assessment, management has concluded no impairment is required in carrying value of the investments, advances/ other receivables from these aforementioned subsidiary companies as at March 31, 2016 aggregating to Rs. 8,455,719,793 (previous year Rs. 10,301,708,211) except in case of HPVL where, subsequent to exit from CDR, management has recorded hundred percent provision in carrying value of investment and receivables during the period.
12. Going concern
The Company has incurred a loss of Rs 7,036,473,934 during the period ended March 31, 2016 (previous year Rs 7,083,003,303), and as of that date, the Company''s accumulated losses amounts to Rs. 23,605,019,015 (previous year Rs. 16,457,149,952) and it has negative net worth of Rs. 17,252,950,584 (previous year Rs. 9,139,176,589). Further, as of March 31, 2016, the Company''s current liabilities exceeded its current assets by Rs. 21,986,021,287 (previous year Rs. 14,877,708,565)
The Company has outstanding foreign currency convertible bonds (FCCBs) with principal value of USD 88,400,000 equivalent to Rs 5,857,384,000 (previous year ended December 31, 2014 USD 88,500,000 equivalent to Rs 5,579,040,000) which were due for redemption along with premium on June 21, 2012. As at March 31, 2016, accrual for premium on FCCB aggregates Rs 4,983,850,363 . The company is in the process of negotiation with the bondholders to re-structure the terms of these bonds and these negotiations have progressed. The Company has applied to the RBI for approval to extend the repayment of FCCBs till December 2016.
Due to continued liquidity issues primarily resulting from non-release of sanctioned working capital limits and refunds due to the Company, the Company has been unable to comply with repayment terms of its borrowing arrangement with secured lenders as agreed in the Corporate Debt Restructuring package approved in year ended March 31, 2013. The Company has received debt recall and other notices from certain consortium lender banks for their respective share of debt. Meanwhile, the Company has approached the lender consortium for a revised debt restructuring plan. The revised debt restructuring plan submitted by the Company includes deferment of debt and interest repayment, disposal of surplus assets and infusion of fresh capital by the promoters. The banks instituted a TEV study to be conducted by an expert appointed by bank who has since submitted its report to the lenders. In a recent meeting, the lenders have indicated their inability to accept the TEV and have indicated their intention to exit from the CDR and initiate legal proceedings against the company subject to approval of their competent authorities. The Company continues to engage with management of banks for restructuring proposal during the period as well as previous year. The final response of the banks is awaited. Meanwhile the banks have allowed the company to continue to operate through TRA with 6% tagging. On March 30, 2016, one of the lender banks, which is part of the CDR consortium of the Company, has assigned its outstanding dues in favour of an asset reconstruction company on the same terms and conditions as applicable to the said lender.
The Company has been operating at suboptimal levels due to working capital constraints, resulting in adverse impact on cash flow from operations. With restoration of OEM optical media business, generation of funds through sale of surplus assets and promoter contribution, accompanied by restructuring of debt from banks, the Company expects to achieve better utilization of its manufacturing facilities and consequently, generate positive cash flow from operations.
Conditions explained above, indicate existence of a material uncertainty that may cast significant doubt on the Company''s ability to continue as a going concern due to which the Company may not be able to realize its assets and discharge its liabilities in the normal course of business. However, considering recent developments, inter-alia, progress made in the review of plan and further management''s plans relating to restructuring of debt, FCCBs, infusion of capital, generation of funds through sale of surplus assets and expected improvement in the operating activities, management is confident of generating positive cash flow from operations and accordingly, these results have been prepared on a going concern basis.
13. Under the Income Tax Act, 1961, for domestic Transfer Pricing transaction the Company is required to use specified methods for computing arm''s length price in relation to domestic transactions with its associated enterprises. Further, Company is required to maintain prescribed information and documents in relating to such transactions. The appropriate method to be adopted will depend on the nature of transactions/class of transactions, class of associated persons, functions performed and other factors, which have been prescribed. The management confirms that all transactions with associated enterprises are undertaken at negotiated contracted prices on usual commercial terms, and adjustments if any, arising from the transfer pricing study shall be accounted for as and when the study is completed. The Company is in the process of conducting a transfer pricing study for the current financial year, however, management is of the view that the same would not have a material impact on the financial statements. Accordingly, these financial statements do not include any adjustments for the transfer pricing implications, if any.
14. During the period ended March 31, 2016, the Company decided to sell part of its non-core assets. On the basis of approval by Board of Directors and upon completion of successful bidding process, assets has been classified as "Non-current asset held for sale" in financial statements. The Company has ceased to charge depreciation from the date of classification as held for sale. Had the company not decided to sell these assets, depreciation for period ended March 31, 2016 would have been higher by Rs. 3,31,081.
15. The Ministry of New & Renewable Energy (''MNRE) had sanctioned grant-in-aid for implementation of R&D project on "Development of CIGS solar cell pilot plant to achieve grid parity solar cess" vide order no. MNRE/31/10/2009-10/PVSE, dated October 21, 2010 with a project cost of Rs. 156,376,000 of which MNRE share was Rs. 71,050,000 and Company''s share was Rs. 85,326,000 for three years. In the year ended March 31, 2011, the Company had received grant of Rs. 35,000,000 for the said project.
Pursuant to the meeting of R&D Project Appraisal Committee (RDPAC) on Solar Photovoltaic and Solar Thermal held on November 16, 2015 and letter No. 15/01/2010-11/ST dated March 28, 2016, the project was considered as commercially unviable and therefore decided to abandon the project and the Company has been requested to shift all MNRE assets acquired out of the grant received to National Institute of Solar Energy (NISE) and unspent money is to be return to the MNRE.
Note 16. on "Fixed Assets" under the sub-head Plant and Equipment includes testing equipments of Rs. 21,139,973 acquired out of the grant received, having carrying value of Rs. 9,329,622 as at March 31, 2016. Out of the total grant received by the Company, balance unspent money of Rs. 13,860,027 has been kept in the form of fixed deposits with one of the nationalised bank and included in cash and bank balances.
Pursuant to the letter received by the Company in respect of demand of unspent money by the MNRE, the grant received has been disclosed in the financial statements as "Deferred Government grant" under sub-head "Other Current Liabilities" during
the current period.
17. During the current period, certain workers at Greater Noida plant instigated illegal stoppage of work, which consequently affected factory operations in the month of March 2015. On account of stoppage of work as aforesaid, the Company''s shipment and revenue were adversely affected. Operating cost were also lower on account of lower expenses including wages cost. With the support of concerned government and administrative authorities, an amicable settlement reached with the workers and normalcy was restored in early April 2015. Company ensured that disruption led to minimum impact on operating cash flows and speedy recovery thereafter.
18. The Company has changed its financial year from 31 December to 31 March and prepared financial statements for 15 months, whereas previous financial year consisted of 12 months period. Accordingly, current financial period figures are not comparable with those of the previous year.
19. Figures of the previous year have been regrouped and rearranged wherever necessary, to make them comparable.
Dec 31, 2014
1 Contingent liabilities
(a) Corporate guarantees given on behalf of the subsidiary companies:
Rs. 20,518,700,000 (previous period Rs. 20,430,975,000). Against these
guarantees, loans aggregating Rs.17,192,809,905 (previous period Rs.
15,867,946,862) have been availed by the subsidiary companies.
(b) Disputed demands (gross) in respect of:
Particulars As at As at
December 31, December 31,
2014 2013
Entry tax
[Amount paid under protest Rs. 10,382,071
(previous period Rs. 11,928,443) and bank
guarantees furnished Rs.10,919,501(previous
period Rs. 15,558,616)] 127,609,720 133,795,207
Service tax
[Amount paid under protest Rs. 2,953,470
(previous period Rs. 2,953,470)] 635,730,978 695,928,194
Sales tax
[Amount paid under protest Rs. 17,960,040
(previous period Rs. 18,454,494) and bank
and other guarantees furnished
Rs. 100,989,626 (previous period
Rs. 104,723,040)] 425,029,622 159,974,070
Custom duty and excise duty
[Amount paid under protest Rs. 5,805,819
(previous period Rs. 5,805,819)] 564,132,236 543,349,313
Income tax
[Amount paid under protest Rs. 34,500,000
(previous period Rs. 34,500,000)] 119,575,567 115,689,581
Total 1,872,078,123 1,648,736,365
(c) Claims against the Company not acknowledged as debts: Rs. 345,900
(previous period Rs. 345,900).
(d) Letters of credit opened by banks on behalf of the Company: Rs.
37,247,363 (previous period Rs. 244,331,479).
(e) Recompense amount payable in lieu of bank sacrifice (mandarory
disclosure as per RBI): Rs. 1,581,305,158 (previous period Rs.
1,194,220,949).
The amount shown in (a) above represents guarantees given in the normal
course of the Company''s operations and are not expected to result in
any loss to the Company on the basis of the beneficiary fulfilling its
ordinary commercial obligations.
The amounts shown in (b) and (c) above represent the best possible
estimates arrived at on the basis of available information. The
uncertainties and possible reimbursements are dependent on the outcome
of the different legal processes which have been invoked by the Company
or the claimants as the case may be and therefore cannot be estimated
accurately. The Company engages reputed professional advisors to
protect its interests and has been advised that it has strong legal
positions against such disputes.
(f) In respect of the outstanding foreign currency convertible bonds (
FCCBs), bondholders have claimed interest for the period beyond the
original date of redemption. As explained in more detail in Note 43 (c
), the company is in the process of negotiating restructuring of these
bonds. Management expects to restructure these bonds by extension of
the redemption date as prescribed by the Reserve Bank of India.
Contingent liability in respect thereof can''t be estimated reliably.
2. Capital commitments
Estimated value of contracts remaining to be executed on capital
account and not provided for (net of advances): Rs. 177,722,251
(previous period Rs. 173,433,150).
3. (a) Lease obligations
The Company has entered into operating leases for its offices, guest
houses, employee''s residences and utilities that are renewable on a
periodic basis and are cancellable at Company''s option. Total lease
payments recognized in the statement of profit and loss with respect to
aforementioned premises is Rs. 527,422,277 (previous period Rs.
444,168,254). The total rent recovered on sub lease during the year is
Rs. 29,730,645 (previous period Rs. 47,253,780).
4 Segment information
The Company is primarily in the business of manufacture and sale of
Optical Storage Media. The other activities of the Company comprise
creation/ replication and distribution of content, sales of consumer
electronic products and operations and maintenance of sector specific
Special Economic Zone for non-conventional energy. As the single
financial report contains both consolidated financial statements and
the separate financial statements of Moser Baer India Limited (the
parent), segment information has been presented only on the basis of
consolidated financial statements of the year ended 31 December 2014.
5 Employee benefits
The Company has classified the various benefits provided to employees
as under : A Defined contribution plans
During the year, the Company has recognised the following amounts in
the statement of profit and loss:
Premium payable on redemption of FCCB accrued up to 31 December 2014
calculated on prorata basis Rs. 3,879,418,653 (previous period Rs.
3,176,579,698) has been fully provided for and charged to securities
premium account. In the event that the conversion option is exercised
by the holders of FCCB in the future, the amount of premium charged to
the securities premium account shall be written back to security
premium account.
(c) The outstanding foreign currency convertible bonds (FCCBs)
aggregating to principal value of USD 88,500,000 (equivalent to Rs
5,579,040,000) matured for redemption on 21 June 2012, which have since
been claimed by the trustee of the bondholders. The Company has
received approval from the Reserve Bank of India to extend the
redemption date of bonds and is in discussions with the bondholders,
through the Trustee, to re-structure the terms of these bonds. In view
of the ongoing negotiations with bondholders, financial obligations of
the Company, other than the premium on redemption, have not been
provided for in books.
6 Based on the information available with the Company, the Company has
identified 32 vendors as micro, small and medium enterprises as defined
in the Micro, Small and Medium Enterprises Development Act, 2006. The
balance due to such vendors has been disclosed separately under trade
payables. (refer note 10)
7 Impairment of investments
The management performed a detailed impairment assessment by engaging
an independent valuer for its investments in and advances/other
receivables from certain subsidiaries, viz. Helios Photo Voltaic
Limited (HPVL), Moser Baer Solar Limited (MBSL), Photovoltaic Holdings
Limited-and Moser Baer Investments Limited*and Moser Baer
Entertainment Limited as at 31 December 2014. Estimates and judgments
used in such assessment are related to future business projections
which, amongst other factors, are dependent on acceptance of revised
restructuring with lender banks, external market conditions of solar
market and regulatory benefits. The developments since the last
detailed assessment carried out by the Company indicate changes in
liquidity position and an improved industry and regulatory environment.
Basis such assessment, the management has recorded a provision for
other than temporary diminution in investment of Rs. 788,191,666 and
provision for doubtful receivables of Rs. 277,165,723 in respect of one
of the subsidiary. Accordingly, net carrying values of investment,
advances, trade and other receivables from these subsidiaries as at 31
December 2014 aggregates to Rs. 9,158,401,892 (previous period
10,484,295,746).
8 Going concern
The Company has incurred a loss of Rs 7,083,003,303 during the year
ended 31 December 2014 (previous period Rs 4,466,627,030), and, as of
that date, the Company''s accumulated losses amounts to Rs.
16,457,149,952 (previous period Rs. 9,374,146,649) and it has negative
net worth of Rs. 9,139,176,589 (previous period Rs. 1,453,334,331).
Further, as of 31 December 2014, the Company''s current liabilities
exceeded its current assets by Rs. 14,877,708,565 (previous period Rs.
9,671,083,241)
Due to continued liquidity issues, the Company has been unable to
comply with repayment terms of its borrowing arrangement with secured
lenders as agreed in the Corporate Debt Restructuring package approved
in 31 March 2013. The Company has now approached these lenders for a
revised debt restructuring plan. The management has submitted its
proposal which is under review at this stage. The revised debt
restructuring plan submitted by the Company includes deferment of debt
and interest repayment, disposal of surplus assets and infusion of
fresh capital by the promoters. The management is hopeful of finalizing
the restructuring package soon.
The Company also has outstanding foreign currency convertible bonds
(FCCBs) with principal value of USD 88,500,000 (equivalent to Rs
5,579,040,000) which were due for redemption on 21 June 2012. As at 31
December 2014, such accrual for premium on FCCB aggregates Rs
3,879,418,653. The Company is in the process of negotiation with the
bondholders to re- structure the terms of these bonds.
The Company has been operating at suboptimal levels due to working
capital constraints, resulting in adverse impact on cash flow from
operations in the current year as well as earlier years. With
generation of funds through sale of surplus assets and promoter
contribution, accompanied by restructuring of debt from banks and FCCB
holders, the Company expects to achieve better utilization of its
manufacturing facilities and consequently, generate positive cash flow
from operations.
Conditions explained above, indicate existence of a material
uncertainty that may cast significant doubt on the Company''s ability to
continue as a going concern due to which the Company may not be able to
realize its assets and discharge its liabilities in the normal course
of business. However, considering management plans relating to
restructuring of debt, infusion of capital and generation of funds
through sale of surplus assets and expected improvement in the
operating activities, these financial statements have been prepared on
a going concern basis.
9 Under the Income Tax Act, 1961, for domestic Transfer Pricing
transaction the Company is required to use specified methods for
computing arm''s length price in relation to domestic transactions with
its associated enterprises. Further, Company is required to maintain
prescribed information and documents in relating to such transactions.
The appropriate method to be adopted will depend on the nature of
transactions/class of transactions, class of associated persons,
functions performed and other factors, which have been prescribed. The
management confirms that all transactions with associated enterprises
are undertaken at negotiated contracted prices on usual commercial
terms, and adjustments if any, arising from the transfer pricing study
shall be accounted for as and when the study is completed. The Company
is in the process of conducting a transfer pricing study for the
current financial year, however, management is of the view that the
same would not have a material impact on the financial statements.
Accordingly, these financial statements do not include any adjustments
for the transfer pricing implications, if any.
10 During the previous period the Company had changed its financial
year from 31 March to 31 December, hence previous financial year
consisted of 9 months period from April 2013 to December 2013.
Accordingly current financial year figures are not comparable with
those of the previous period.
Dec 31, 2013
1 Basis of preparation
These abridged financial statements have been prepared in accordance
with the requirements of Rule 7A of the Companies (Central
Government''s) General Rules and Forms, 1956 and clause 32 of the
Listing Agreement. These abridged financial statements have been
prepared on the basis of the complete set of audited standalone
financial statement for the year ended 31 December 2013.
2 Contingent liabilities
(Refer note 33 to complete set of audited standalone financial
statement)
(a) Corporate guarantees given on behalf of the subsidiary companies:
Rs. 20,430,975,000 (previous year Rs. 24,678,450,000). Against these
guarantees, loans aggregating Rs. 15,867,946,862 (previous year Rs.
15,270,411,636) have been availed by the subsidiary companies.
(b) Disputed demands (gross) in respect of:
Particulars As at As at
31 December 2013 31 March 2013
Entry tax
[Amount paid under protest
Rs. 11,928,443 (previous year
Rs. 10,354,421) and bank guarantees
furnished Rs. 15,558,616
(previous year Rs. 10,919,501)] 133,795,207 133,519,072
Service tax
[Amount paid under protest
Rs. 2,953,470 (previous year
Rs. 2,953,470)] 695,928,194 367,384,719
Sales tax
[Amount paid under protest
Rs. 18,454,494 (previous year
Rs. 17,010,790) and bank and Other
guarantees furnished Rs. 104,723,040
(previous year Rs. 101,470,187)] 159,974,070 121,988,323
Custom duty and excise duty
[Amount paid under protest
Rs. 5,805,819 (previous year
Rs. 5,796,635)] 543,349,313 527,676,009
Income tax
[Amount paid under protest
Rs. 34,500,000 (previous year
Rs. 34,500,000)] 115,689,581 112,775,091
Total 1,648,736,365 1,263,343,214
(c) Claims against the Company not acknowledged as debts: Rs. 345,900
(previous year Rs. Nil).
(d) Letters of credit opened by banks on behalf of the Company: Rs.
244,331,479 (previous year Rs. 356,269,994).
(e) Recompense amount payable in lieu of bank sacrifice (mandarory
disclosure as per RBI): Rs. 1,194,220,949 (previous year Rs.
855,284,159).
The amount shown in (a) above represents guarantees given in the normal
course of the Company''s operations and are not expected to result in
any loss to the Company on the basis of the beneficiary fulfilling its
ordinary commercial obligations.
The amounts shown in (b) and (c) above represent the best possible
estimates arrived at on the basis of available information. The
uncertainties and possible reimbursements are dependent on the outcome
of the different legal processes which have been invoked by the Company
or the claimants as the case may be and therefore cannot be estimated
accurately. The Company engages reputed professional advisors to
protect its interests and has been advised that it has strong legal
positions against such disputes.
3 Capital commitments
(Refer note 34 to complete set of audited standalone financial
statement)
Estimated value of contracts remaining to be executed on capital
account and not provided for (net of advances): Rs. 173,433,150
(previous year Rs. 155,128,173).
4 Related party transactions:
(Refer note 40 to complete set of audited standalone financial
statement)
In accordance with the requirements of Accounting Standard - 18
''Related Party Disclosures'' the names of the related party where
control/ability to exercise significant influence exists, along with
the aggregate amount of transactions and period end balances with them
as identified and certified by the management are given below:
5 Segment information
(Refer note 42 to complete set of audited standalone financial
statement)
The Company is primarily in the business of manufacture and sale of
Optical Storage Media. The other activities of the Company comprise
creation/ replication and distribution of content, sales of consumer
electronic products and operations and maintenance of sector specific
Special Economic Zone for non-conventional energy.
As the single financial report contains both consolidated financial
statements and the separate financial statements of Moser Baer India
Limited (the parent), segment information has been presented only on
the basis of consolidated financial statements of the period ended 31
December 2013.
6 Foreign currency convertible bonds
(Refer note 44 to complete set of audited standalone financial
statement)
Premium payable on redemption of foreign currency convertible bonds
accrued up to 31 December 2013 calculated on prorata basis Rs.
3,176,579,698 (previous year Rs. 2,399,718,659 has been fully provided
for and charged to securities premium account. In the event that the
conversion option is exercised by the holders of foreign currency
convertible bonds in the future, the amount of premium charged to the
securities premium account shall be written back to the securities
premium account.
(d) The outstanding foreign currency convertible bonds (FCCBs)
aggregating to principal value of USD 88,500,000 (equivalent to Rs
5,471,955,000) matured for redemption on 21 June 2012, which have since
been claimed by the trustee of the bondholders. The Company has
received approval from the Reserve Bank of India to extend the
redemption date of bonds and is in discussions with the bondholders,
through the Trustee, to re-structure the terms of these bonds. Pending
acceptance by the bondholders and approval from the concerned
regulatory authorities of the terms proposed by the Company, the
financial obligations of the Company, other than premium on redemption,
are presently not reasonably determinable, and hence have not been
provided for. The petition under section 434 of the Companies Act,
1956, filed by the trustee on behalf of certain bondholders with the
Hon''ble High Court of Delhi, which has since been admitted, and
continues to be sub-judice.
7 Corporate debt restructuring scheme
(Refer note 7(c) to complete set of audited standalone financial
statement)
During the year ended 31 March 2013, the Company accounted for
corporate debt restructuring scheme (reclassifications and interest
calculations) in the books for the year ended 31 March 2013. As per the
corporate debt restructuring scheme, Company recorded amounts
receivable from banks on account of installment paid prior to
implementation of corporate debt restructuring, excess interest paid by
the Company and release of additional limits as per the scheme. As of
31 December 2013, a total of Rs. 855,841,627 (previous year Rs.
1,334,391,231) is outstanding to be received from banks. Recovery of
this balance is subject to completion of reconciliation of corporate
debt restructuring adjustments with some of the lender banks. Based on
acceptance of management''s calculation by certain lender banks, the
management is of the view there will not be any material adjustment to
this receivable.
The Borrowers and the CDR Lenders executed a MRA during the previous
year. The MRA as well as the provisions of the Master Circular on
Corporate Debt Restructuring issued by the Reserve Bank of India, give
a right to the CDR Lenders to get a recompense of their waivers and
sacrifices made as part of the CDR Proposal. The recompense payable by
the borrowers is contingent on various factors including improved
performance of the borrowers and many other conditions, the outcome of
which currently is materially uncertain and hence the proportionate
amount payable as recompense has been treated as a contingent
liability. The aggregate present value of the sacrifice made/ to be
made by CDR Lenders as per the MRA is approximately Rs 160.72 crore for
the Company.
8 Going concern
The Company has incurred loss of Rs 4,466,627,030 during the nine
months period ended 31 December 2013, which along with the accumulated
losses as of 31 December 2013 has completely eroded its net worth as on
31 December 2013. The Company''s corporate debt restructuring scheme to
re-structure the borrowings from secured lenders has already been
approved and is confident of re-structuring the FCCB obligation as
described in note 44(d), in the terms proposed by the Company. Pending
the outcome of aforementioned discussions with the bondholders and the
related litigation, successful implementation of corporate debt
restructuring scheme in terms proposed by the Company, which are
materially uncertain, the financial statements of the Company have been
prepared on going concern basis.
Such assessment is based on certain assumptions inter-alia, successful
implementation of new technologies, new product initiatives, external
market conditions, regulatory benefits and conclusion of debt
restructuring in the terms as proposed by HPVL and MBSL, which are
materially uncertain. Based on such assessment, the management has
recorded a provision for diminution of Rs. 111,510,000 in the
investment of HPVL, and has written off Rs. 397,918,175 and Rs.
2,081,825 from loans and advances and trade and other receivables
respectively of MBEL for the period ended 31 December 2013.
9 Corresponding figures for the previous year have been regrouped /
rearranged, wherever necessary to conform to current period
classification.
10 The Company changed its financial year from 31 March to 31 December
and consequently, current financial year consist of nine months period
from April 2013 to December 2013. Accordingly, current financial year
figures are not comparable with those of the previous year.
11 Complete balance sheet, statement of profit and loss, cash flow
statement and notes thereto prepared as per the requirements of
Schedule VI to the Companies Act, 1956 are available at the Company''s
website at link - www.moserbaer.in
Mar 31, 2013
1 Basis of preparation
The financial statements have been prepared to comply with the
Accounting Standards referred to in the Companies (Accounting
Standards) Rules, 2006 issued by the Central Government in exercise of
the power conferred under sub-section (1) (a) of section 642, the
relevant provisions of the Companies Act, 1956 (the ''Act'') and relevant
pronouncements issued by the Institute of Chartered Accountants of
India. The financial statements have been prepared on a going concern
basis under the historical cost convention on accrual basis. The
accounting policies have been consistently applied by the Company.
2 Use of estimates
The preparation of financial statements in conformity with the
principles generally accepted in India requires management to make
estimates and assumptions that affect the reported amount of assets and
liabilities and the disclosure of contingent liabilities on the date of
financial statements and the reported amounts of revenues and expenses
during the reporting period. Example of such estimates include
provisions for doubtful debts/ advances, employee retirement benefit
plans, warranty, provision for income taxes, useful life of fixed
assets, diminution in value of investments, other probable obligations
and inventory write down. Actual results could differ from those
estimates. Any revision to accounting estimates is recognised
prospectively in the current and future periods.
3 Contingent liabilities
(a) Corporate guarantees given on behalf of the subsidiary companies:
Rs.24,678,450,000 (previous year Rs. 24,099,600,000). Against these
guarantees, loans aggregating Rs.15,270,411,636 (previous year Rs.
15,573,866,190) have been availed by the subsidiary companies.
(b) Disputed demands (gross) in respect of:
Particulars As at As at
March 31, 2013 March 31, 2012
Entry tax
[Amount paid under protest Rs.
10,354,421 (previous year
Rs. 1,863,606) and bank guarantees
furnished Rs. 10,919,501
(previous year Rs. 10,366,154)] 133,519,072 127,761,075
Service tax
[Amount paid under protest Rs.
2,953,470 (previous year
Rs. 2,953,470)] 367,384,719 351,157,722
Sales tax
[Amount paid under protest Rs.
17,010,790 (previous year
Rs. 10,725,595) and bank and
other guarantees furnished
Rs. 101,470,187 (previous year
Rs. 13,645,780)] 121,988,323 121,658,833
Custom duty and excise duty
[Amount paid under protest Rs.
5,796,635 (previous year
Rs. 5,103,586) and bank guarantees
furnished Rs. Nil
(previous year Rs. Nil)] 527,676,009 486,001,268
Income tax
[Amount paid under protest
Rs. 34,500,000 (previous year
Rs. 34,500,000)] 108,889,105 108,889,105
Total 1,259,457,228 1,195,468,003
(c) Claims against the Company not acknowledged as debts: Rs. Nil
(previous year Rs. 78,048).
(d) Letters of credit opened by banks on behalf of the Company: Rs.
356,269,994 (previous year Rs. 285,514,138).
The amount shown in (a) above represents guarantees given in the normal
course of the Company''s operations and are not expected to result in
any loss to the Company on the basis of the beneficiary fulfilling its
ordinary commercial obligations.
The amounts shown in (b) and (c) above represent the best possible
estimates arrived at on the basis of available information. The
uncertainties and possible reimbursements are dependent on the outcome
of the different legal processes which have been invoked by the Company
or the claimants as the case may be and therefore cannot be estimated
accurately. The Company engages reputed professional advisors to
protect its interests and has been advised that it has strong legal
positions against such disputes.
4 Capital commitments
Estimated value of contracts remaining to be executed on capital
account and not provided for (net of advances): Rs. 155,128,173
(previous year Rs. 205,501,851).
5 (a) Lease obligations
The Company has entered into operating leases for its offices, guest
houses and employee''s residences that are renewable on a periodic basis
and are cancellable at Company''s option. Total lease payments
recognized in the statement of profit and loss with respect to
aforementioned premises is Rs. 94,482,855 (previous year Rs.
86,654,491). The total rent recovered on sub lease during the year is
Rs. 63,005,040 (previous year Rs. 63,005,040).
6 Derivative instruments
The Company uses forward exchange contracts to hedge against its
foreign currency exposures relating to the underlying transactions and
firm commitments. The Company does not enter into any derivative
instruments for trading or speculative purposes.
7 Segment information
The Company is primarily in the business of manufacture and sale of
Optical Storage Media. The other activities of the company comprise
creation/ replication and distribution of content, sales of consumer
electronic products and operations and maintenance of sector specific
Special Economic Zone for non-conventional energy.
As the single financial report contains both consolidated financial
statements and the separate financial statements of Moser Baer India
Limited (the parent), segment information has been presented only on
the basis of consolidated financial statements of the year ended March
31, 2013.
8 Employee benefits
The Company has classified the various benefits provided to employees
as under : A Defined contribution plans
During the year, the Company has recognised the following amounts in
the statement of profit and loss: (i) Provident fund
B Defined benefit plans
(i) In accordance with Accounting Standard 15, the liability in respect
of defined benefit plans, namely gratuity and unavailed earned leaves
has been determined based on actuarial valuation based on the following
assumptions:
9 Based on the information available with the Company, the Company has
identified 32 vendors as micro, small and medium enterprises as defined
in the Micro, Small and Medium Enterprises Development Act, 2006. The
balance due to such vendors has been disclosed separately under trade
payables. (refer note 11)
10 Impairment of Investments
(a) The Company has performed a detailed assessment, using valuations
performed by an independent valuer, to determine whether its
investments in and advances or other receivables from MBPV and MBSL are
recoverable. Such assessment is based on successful implementation of
new technologies, external market conditions, regulatory benefits and
conclusion of debt restructuring in the terms as proposed by these
subsidiaries. The management has concluded that no adjustments to the
carrying values of underlying investments in and advances or other
receivables from these subsidiaries aggregating to Rs 7,635,698,665 are
required to be made in the results for the year ended March 31, 2013.
(b) The Company has an investment in and certain amounts recoverable
from another subsidiary, Moser Baer
Entertainment Limited (MBEL) amounting to Rs 1,574,996,840 as at March
31, 2013. A business valuation of MBEL has been carried out by the
management internally based on MBEL''s business plans, which include new
initiatives to be undertaken by the Company and MBEL to leverage the
market. Based on this valuation, no provision for impairment of either
the investment or amounts recoverable has been made in the stand alone
financial statements of the Company for the year ended March 31, 2013.
11 Corresponding figures for the previous year have been regrouped /
rearranged, wherever necessary to conform to current year
classification.
Mar 31, 2012
(A) Term and rights attached to equity shares:
The Company has one class of equity shares having par value of Rs. 10
each. Each shareholder is eligible for one vote per share held. The
dividend proposed by the Board of Directors, if any is subject to the
approval of the shareholders in the ensuing Annual General Meeting. In
the event of liquidation, the equity shareholders are eligible to
receive the remaining assets of the Company after distribution of all
preferential amounts, in proportion to their shareholding.
750,000 Preferrence shares of Rs. 100 each have been cancelled during the
year and reclasified into eqity share of Rs. 10 each. Further, the
authorised share capital of the Company has been increased during the
year vide shareholders resolution passed in the annual general meeting
of the company held on September 29, 2011
(B) Stock option plans
The Company has two Stock Option Plans:
(a) Employee Stock Option Plan-2004 & Director's Stock Option Plan-2005
The Company has granted options to its non-executive directors and
employees of the Company and its subsidiaries, to be settled through
issue of equity shares.
The Options granted vest over a period of maximum of four years from
the date of grant.
In case of Employee Stock Option Plan-2004, the exercise price shall be
as follows:-
(i) Normal allocation:- Rs. 125 per option or prevailing market price,
whichever is higher.
(ii) Special allocation:- 50% of the options at Rs. 125 per option or
prevailing market price, whichever is higher and the balance 50% of the
options at Rs. 170 per option or prevailing market price, whichever is
higher.
In case of Directors' Stock Option Plan, the exercise price shall be Rs.
170 per option or prevailing market price, whichever is higher."
Two options granted before the record date under the above plans
entitles the holder to three equity shares of the Company.
The options outstanding at the end of year had exercise prices in the
range of Rs. 125 to Rs. 491.90 (previous year Rs. 125 to Rs. 491.90) and a
weighted average remaining contractual life of 0.79 years (previous
year 1.39 years).
(a) Employee Stock Option Plan-2009
The Company established a stock option plan called " Moser Baer India
Limited Stock Option Plan 2009". The plan was setup to offer and grant
stock options, in one or more tranches, to employees and directors of
the Company as the compensation committee of the Company may determine.
The granted options shall be settled through issue of equity shares.
The exercise price shall be as follows:-
(i) Normal allocation:- Market price on the date of grant
(ii) Special allocation:- 50% of the options at Rs. 125 per option or
prevailing market price, whichever is higher and the balance 50% of the
options at Rs. 170 per option or prevailing market price, whichever is
higher.
All options, whether vested or unvested, granted to grantee shall in
any case expire after a period of seven years from the offer date.
During the current year, the Company has issued Nil (previous year
497,600) options to eligible employees. The vesting period for the
option granted varies from 12 to 48 months from the date of the grant.
No options have been exercised during the year.
Fair values used for above computations have been calculated by taking
into account the weighted average vesting period of the options.
(d) The following assumptions were used for calculation of fair value
of grants:
(i) Moser Baer Employees Stock Option Plan(ESOP) 2004 and Director's
Stock Option Plan (DSOP) 2005*
* No options granted during the year.
b) corporate debt restructuring scheme
During the year the Company applied for Corporate debt restructuring
(CDR) to re-structure its existing debt obligations. The Company
received the final Letter of Approval (LoA) dated October 22, 2012 from
the Corporate Debt Restructuring Empowered Group (CDR-EG) to
re-structure existing debt obligations, including interest, additional
funding and other terms (hereafter referred to as "the CDR Scheme").
The board of directors of the Company at their meeting held on November
09, 2012 approved the terms of the CDR Scheme for implementation. The
effect of the CDR Scheme has not been given in the financial results of
the Company as of March 31, 2012, since the execution of the Master
Restructuring Agreement (MRA) by all the lenders is pending and the
Company in the process of complying with the conditions precedent to
the implementation of the CDR Scheme.
(c) Interest rates
- Interest rate on long term loan varies from 12% to 16.50% p.a.
- Interest rate on foreign currency loan is 5.50% p.a.
* The Company's foreign currency convertible bonds (FCCBs) having face
value of Rs. 45,038 lacs (equivalent to USD 88.5 million) were due for
redemption on June 21, 2012, along with the premium on redemption of Rs.
17,931 lacs. The Company is in the process of re-structuring these
FCCBs and has accordingly, received approval from the Reserve Bank of
India (RBI) to extend the term of these FCCBs up to December 20, 2012,
subject to the consent of bond holders. The Company is in discussions
with the FCCB holders to restructure its obligation (both the face
value and the premium) along with certain terms inter-alia, exchange of
old bonds with new bonds, maturity of new bonds, redemption premium and
conversion option.
Note :
Ministry of New and Renewable Energy of the Government of India, as
part of its Jawaharlal Nehru Nation Solar Mission 2010 sanctioned a
Research and Development ('R&D') grant to the Company for its project
'Development of CIGS solar cell pilot plant to achieve grid parity
solar cells'. One of the objectives of the grant is to develop low cost
solar cell module with an aim to meet grid parity by using Cu(InGa)Se2
solar cells. During the previous year, the company received R&D grant
of Rs. 35,000,000 out of the total grant of Rs. 71,050,000 being 50 % of
the total project equipment cost of Rs. 142,100,000. Pending acquisition
of the equipment, the grant received has been disclosed in the
financial statements as 'Government Grant' which shall be adjusted to
the cost of the specific fixed assets.
* Warranty provision relates to the estimated outflow in respect of
warranty for products sold by the Company. Due to very nature of such
costs, it is not possible to estimate the timing/uncertainties relating
to their outflows as well as expense from such estimates.
** Probable obligations provision relates to the estimated outflow in
respect of possible liabilities expected to arise in future. Due to
very nature of such costs, it is not possible to estimate the
timing/uncertainties relating to their outflows as well as expense from
such estimates.
1 contingent liabilities
(a) Corporate guarantees given on behalf of the subsidiary companies: Rs.
24,099,600,000 (previous year Rs. 21,253,587,500). Against these
guarantees, loans aggregating Rs. 15,573,866,190 (previous year Rs.
18,083,789,271) have been availed by the subsidiary companies.
(b) Disputed demands (gross) in respect of:
Particulars As at As at
March 31, 2012 March 31, 2011
Rs. Rs.
Entry Tax 127,761,075 127,297,833
[Amount paid under protest
Rs. 1,863,606 (previous year
Rs. 1,863,606) and bank guarantees
furnished Rs. 10,366,154
(previous year Rs. 2,058,688)]
Service Tax 351,157,722 154,559,343
[Amount paid under protest
Rs. 2,953,470 (previous year
Rs. 2,953,470)
Sales Tax 121,658,833 16,728,917
[Amount paid under protest
Rs. 10,725,595 (previous year
Rs. 4,543,604) and bank guarantees
furnished Rs. 13,645,780 (previous
year Rs. 11,408,640)]
custom duty and excise duty 486,001,268 32,668,448
[Amount paid under protest
Rs. 5,103,586 (previous year
Rs. 4,500,696) and bank guarantees
furnished Rs. Nil (previous year
Rs. 12,000,000)
Income Tax 108,889,105 105,003,119
[Amount paid under protest
Rs. 34,500,000 (previous year
Rs. 34,500,000)]
Total 1,195,468,003 436,257,659
(c) Claims against the Company not acknowledged as debts: Rs. 78,048
(Previous year Rs. 2,317,645).
The amount shown in (a) above represents guarantees given in the normal
course of the Company's operations and are not expected to result in
any loss to the Company on the basis of the beneficiary fulfilling its
ordinary commercial obligations.
The amounts shown in (b) and (c) above represent the best possible
estimates arrived at on the basis of available information. The
uncertainties and possible reimbursements are dependent on the outcome
of the different legal processes which have been invoked by the Company
or the claimants as the case may be and therefore cannot be estimated
accurately. The Company engages reputed professional advisors to
protect its interests and has been advised that it has strong legal
positions against such disputes.
(d) Letters of credit opened by banks on behalf of the Company: Rs.
285,514,138 (previous year Rs. 859,758,073).
2 capital commitments
Estimated value of contracts remaining to be executed on capital
account and not provided for (net of advances): Rs. 205,501,851 (previous
year Rs. 447,328,684).
3 (a) Lease obligations
The Company has entered into operating leases for its offices, guest
houses and employee's residences that are renewable on a periodic basis
and are cancellable at Company's option. Total lease payments
recognized in the statement of profit and loss with respect to
aforementioned premises is Rs. 86,654,491 (previous year Rs. 61,856,036).
The total rent recovered on sub lease during the year is Rs. 63,005,040
(previous year Rs.21,001,679).
(c) Assets given on finance lease
The Company has given buildings and utilities on financial lease to
units operating in its SEZ division.
Buildings are given on lease for a period of 20 years and utilities are
given for a period of 7-10 years. Apart from the regular lease rental
the Company has also taken interest free refundable security deposits
of Rs. 1,605,000,000 ( Previous Year Rs. 1,605,000,000) from the lessees
which is refundable at the end of the lease term.
4 Taxation
Provision for taxation has not been made in the absence of assessable
taxable income as per the Income Tax Act,1961.
Notes:
1) The tax impact for the above purpose has been arrived at by applying
a tax rate of 32.445% (previous year 32.445%) being the prevailing tax
rate for Indian Companies under the Income Tax Act, 1961
2) Deferred tax asset has been recognised only to the extent of the
deferred tax liability.
5 Derivative instruments
The Company uses forward exchange contracts to hedge against its
foreign currency exposures relating to the underlying transactions and
firm commitments. The Company does not enter into any derivative
instruments for trading or speculative purposes.
6 Related Party Transactions:
In accordance with the requirements of Accounting Standard - 18
'Related Party Disclosures' the names of the related party where
control/ability to exercise significant influence exists, along with
the aggregate amount of transactions and year end balances with them as
identified and certified by the management are given below:
(c) During the previous year, the terms of the existing investment of
7,500,000, 9% redeemable preference shares of Rs. 10 each (optionally
redeemable at the option of the issuer at premium of Rs. 90/- per share
subject to compulsory redemption within 20 years from the date of
allotment), invested in MB SEZ Developer Limited, the subsidiary
company have been altered (with retrospective effect from April 1,
2009) to 7,500,000 9% compulsorily cumulative convertible preference
shares of Rs. 10 each fully paid up into equity shares with in a period
of 10 years from the original date of allotment i.e. April 1, 2009 at
the option of the Company. The ratio of conversion would be decided at
the time of conversion.
(d) The terms of the existing 63,114,660, redeemable preference shares
of Rs.10 each invested in Moser Baer Investments Limited, the subsidiary
company, during the previous year, have been altered to compulsorily
convertible preference shares into equity shares with in a period of 10
years from the original date of allotment i.e. May 4, 2010 at the
option of the Company. The ratio of conversation shall be 1:1.
7 Segment information
The company is primarily in the business of manufacture and sale of
Optical Storage Media. The other activities of the company comprise
creation/ replication and distribution of content, sales of consumer
electronic products and operations and maintenance of sector specific
Special Economic Zone for non-conventional energy. As the single
financial report contains both consolidated financial statements and
the separate financial statements of Moser Baer India Limited(the
parent), segment information has been presented only on the basis of
consolidated financial statements of the year ended March 31, 2012.
8 Employee benefits
The Company has classified the various benefits provided to employees
as under :- A Defined contribution plans
During the year, the Company has recognised the following amounts in
the statement of profit and loss:
# Restated as at year end.
**Excludes issue expencess paid without utilising FCCB funds.
* Net of foreign exchange gain of Rs. 958,895 for the year ended March
31, 2012 and loss of Rs. 46,525 for the year ended March 31, 2011.
Premium payable on redemption of FCCB accrued up to March, 31, 2012
calculated on prorata basis Rs. 1,793,150,173 (previous year Rs.
1,064,331,621) has been fully provided for and charged to securities
premium account. In the event that the conversion option is exercised
by the holders of FCCB in the future, the amount of premium charged to
the securities premium account shall be written back to security
premium account.
(c) Pursuant to the notification issued by The Ministry of Corporate
Affairs dated May 11, 2011 read with the notification issued on March
31, 2009, the company has chosen to avail the option to accumulate
exchange differences arising on long term foreign currency monetary
items in the "Foreign Currency Monetary Item Translation Difference
Account". Amount remaining to be amortised in this account is as under:
9 Based on the information available with the Company, the Company has
identified 34 vendors as micro, small and medium enterprises as defined
in the Micro, Small and Medium Enterprises Development Act, 2006. The
balance due to such vendors has been disclosed separately under trade
payables. (refer note 10)
10 Impairment of investments
(a) A subsidiary of the Company, Moser Baer Solar Limited (MBSL) and
its subsidiary Moser Baer Photovoltaic Limited (MBPV) were also
referred for debt restructuring with the Corporate Debt Restructuring
Cell (CDR cell). MBPV received the final letter of approval dated
September 27, 2012 to re-structure existing debt obligations, including
interest, additional funding and other terms. The debt re-structuring
proposal of Moser Baer Solar Limited (MBSL) is under discussion amongst
its lenders. In anticipation of the successful implementation of the
CDR scheme, the financial statements of MBSL have been prepared on a
going concern basis. Further, the management of these subsidiaries has
obtained business valuations as of March 31, 2012 by an independent
valuer, with the information and projections used for Techno Economic
Viability (TEV) assessment by the consortium of banks participating in
the CDR schemes of the respective subsidiaries. The aforementioned
business valuation has been done using the discounted cash flows method
with significant underlying assumptions, including, conclusion of
Corporate Debt Restructuring in the terms proposed or accepted by
CDREG, as the case may be, implementation of regulatory measures by the
appropriate authority and successful implementation of new technologies
by these companies.
Based on the business valuations, the Company has concluded that no
adjustment is necessary to the underlying investments in and advances
to these subsidiaries aggregating to Rs. 7,189,249,810 in the standalone
financial results for year ended March 31, 2012.
(b) The Company has an investment in and certain amounts recoverable
from another subsidiary, Moser Baer Entertainment Limited (MBEL)
amounting to Rs. 1,482,236,259 as at March 31, 2012. A business valuation
of MBEL has been carried out by an external valuer based on Company's
business plans, which include new initiatives to be undertaken by the
Company and MBEL to leverage the market. Based on this valuation, no
provision for impairment of either the investment or amounts
recoverable has been made in the stand alone financial statements of
the Company as at March 31, 2012.
11 During the year ended March 31, 2012, the revised schedule VI
notified under the Companies Act, 1956, has become applicable to the
Company, for preparation and presentation of its financial statements.
The adoption of revised schedule VI does not impact recognition and
measurement principles followed for preparation of financial
statements. However, it has significant impact on presentation and
disclosures made in the financial statements. The Company has also
reclassified the previous year figures in accordance with the
requirements applicable in the current year.
Mar 31, 2011
1 Contingent Liabilities
In respect of:-
1.1 Corporate guarantees given on behalf of the Subsidiary Companies:
Rs.21,253,587,500 (Previous Year Rs. 17,383,425,000). Against these
guarantees, loans aggregating Rs.18,083,789,271 (Previous Year Rs.
16,042,958,865) have been availed by the subsidiary companies. (Refer
Note 11.4 below)
1.2 Disputed demands (Gross) in respect of:-
2010-11 2009-10
(Rs.) (Rs.)
Entry Tax
[Amount paid under protest Rs. 1,863,606
(Previous Year Rs. 1,688,086);
bank guarantees furnished Rs. 2,058,688
(Previous Year Rs. 1,882,668)] 127,297,833 126,302,825
Service Tax
[Amount paid under protest Rs. 2,953,470
(Previous Year Rs. 2,953,470) 154,559,343 148,498,311
Sales Tax
[Amount paid under protest Rs. 4,543,604
(Previous Year Rs. 7,003,604);
bank guarantees furnished Rs. 11,408,640
(Previous Year Rs. 24,987,468)] 16,728,917 101,925,563
Custom duty and Excise duty
[Amount paid under protest Rs. 4,500,696
(Previous Year Rs. 594,598) ; bank
guarantees furnished Rs. 12,000,000
(Previous Year Rs. 12,000,000) 32,668,448 26,865,664
Income Tax
[Amount paid under protest Rs. 34,500,000
(Previous Year Rs. 34,500,000)] 85,294,174 85,294,174
Total 416,548,715 488,886,537
1.3 Claims against the Company not acknowledged as debts: Rs. 2,317,645
(Previous Year Rs. 2,317,645).
The amount shown in 1.1 above represents guarantees given in the normal
course of the Company's operations and are not expected to result in
any loss to the Company on the basis of the beneficiary fulfilling its
ordinary commercial obligations.
The amounts shown in 1.2 and 1.3 above represent the best possible
estimates arrived at on the basis of available information. The
uncertainties and possible reimbursements are dependent on the outcome
of the different legal processes which have been invoked by the Company
or the claimants as the case may be and therefore cannot be estimated
accurately. The Company engages reputed professional advisors to
protect its interests and has been advised that it has strong legal
positions against such disputes.
2 In February 2003, Moser Baer India Limited (Moser Baer), and Imation
Corporation Inc., USA (Imation), formed an associate Company called
Global Data Media FZ LLC (GDM). GDM is owned 51% by Imation, and 49% by
Moser Baer. On October 27, 2006, Imation filed a suit in Minnesota, USA
against Koninkiljke Philips Electronics NV (Philips) seeking a
Declaratory Judgement on the validity of the Cross License Agreement
(CLA) entered into with Minnesota Mining and Manufacturing Co. (3M)
and its assignment to Imation and its subsidiaries (including GDM).
Moser Baer supplies recordable media to GDM and Imation under the ambit
of CLA.
Philips filed a suit against Moser Baer in The Hague, Netherlands
challenging the status and validity of the CLA under which supplies of
recordable media have been made to Imation and its subsidiaries. With a
view to reinforce its stand on the CLA , Imation joined the proceedings
in the Netherlands as a party, to contest the suit.
In order to protect the rights arising out of various patent license
agreements executed between Moser Baer and Phillips, Moser Baer filed a
suit against Philips challenging the default notices issued by Philips
thereby pre-empting any possibility of termination of the
aforementioned license agreements.
During the previous year, the company had entered into a" Settlement
Agreement "with Phillips and Imation thus bringing an end to all
disputes and also entered inti a Capacity based Licencing Agreement
with Philips for payment of licence fees on recordable media for a
period of four year, the finical impact of which has been considered in
these financial statement.
3 During the Previous Year 2009-10, the Company had entered into a
"Business Transfer Agreement" with Moser Baer Entertainment Limited, a
wholly owned subsidiary, for transfer of its entertainment business on
a slump sale basis. The consideration was determined based on an
valuation done by an independent valuer appointed by the Company. As a
result, the following assets and liabilities were transferred to the
subsidiary on a going concern basis. Surplus arising from transfer of
business aggregating Rs 64,041,243 is included in "Other income".
4 4.1 Estimated value of contracts remaining to be executed on capital
account and not provided for (net of advances): Rs. 447,328,684
(Previous Year Rs. 382,458,388).
4.2 Letters of Credit opened by banks on behalf of the Company: Rs.
859,758,073 (Previous Year Rs. 906,671,619).
5 (A) Lease Obligations
The Company has entered into operating leases for its offices, guest
houses and employee's residences that are renewable on a periodic basis
and are cancellable at Company's option. Total lease payments
recognized in the statement of Profit and Loss Account: Rs. 61,856,036
(Previous Year Rs. 62,084,330). The total rent recovered on sub lease
during the year is Rs. 21,001,680 (Previous Year Rs.141,924).
5 General Description of Lease terms :
a. The Company has provided buildings and utilities on financial lease
to units operating in its SEZ division.
b. Buildings are given on lease for a period of 20 years and utilities
are given for a period of 7-10 years. Apart from the regular lease
rental the Company has also taken interest free refundable security
deposits of Rs. 1,605,000,000 (Previous Year Rs 1,605,000,000) from the
lessees which is refundable at the end of the lease term.
7 Taxation
Provision for taxation has not been made in the absence of assessable
taxable profits as per Income Tax Act, 1961.
Deferred tax in respect of timing differences for undertakings enjoying
tax holiday period under section 10A and section 10B of the Income Tax
Act, 1961 have been recognised in the year in which they originate, to
the extent that such differences reverse after the tax holiday period.
8 Employees Stock Option Plan (ESOP) and Directors' Stock Option Plan
(DSOP)
a) Employee Stock Option Plan-2004 & Director's Stock Option Plan-2005
The Company has granted options to its non-executive directors and
employees of the Company and its subsidiaries, to be settled through
issue of equity shares, The options granted vest over period of maximum
of four years from the date of grant.
In case Employee Stock Option Plan -2004, The Exercise Price shall be
as follows:- (I) Normal allocation- Rs125 per Option or prevailing
Market Price, whichever is higher.
(ii) Special allocation- 50% of the Options at Rs 125 per Option or
prevailing market price ,whichever is higher and the balance 50%of the
Options at Rs 170 Per Option or prevailing market price ,whichever is
higher.
In case of Director's Stock Option Plan, the Exercise Price shall be
Rs. 170 per Option or prevailing Market Price, whichever is higher.
Two options granted before the record date under the above plans
entitles the holder to three equity shares of the Company.
The options outstanding at the end of year had exercise prices in the
range of Rs. 125 to Rs. 491.90 (Previous Year Rs. 125 to Rs. 491.90)
and a weighted average remaining contractual life of 1.39 years
(Previous Year 2.24 years).
During the year Nil (Previous Year Nil Nos. ) options were exercised
resulting in a premium of Nil (Previous Year Rs. Nil) which is the
excess of exercise price of the options and nominal value of shares
allotted.
Employee Stock Option Plan-2009
During the year the Company established a stock option plan called.
"Moser Baer India Limited Stock Option Plan 2009" The plan was
established on September 8, 2009.The plan was setup to offer and grant
stock options, in one or more tranches, to employees and directors of
the Company as the compensation committee of the Company determine. The
granted options shall be settled through issue of equity shares. The
exercise price shall be as follows:- (I) Normal allocation- Market
price on the date of grant.
(ii) Special allocation- 50% of the Options at Rs 125 per Option or
prevailing market price ,whichever is higher and the balance 50%of the
Options at Rs 170 Per Option or prevailing Market Price, whichever is
higher.
All Options, whether vested or unvested, granted to grantee shall in
any case expire after a period of 7 years from the offer date.
During the current year, the Company under the 2009 plan has issued
497,600 Nos options to eligible employees. No options have been
exercised during the year. The vesting period for the option granted
varies from 12 to 48 months from the date of the grant.
The options outstanding at the end of year had exercise prices in the
range of Rs. 46.30 to Rs. 170.00 (Previous Year Rs. 75.95 to Rs.
170.00) and a weighted average remaining contractual life of 3.04 years
(Previous Year 3.94 years).
Fair values used for above computations have been calculated by taking
into account the weighted average vesting period of the options.
10.3 The Ministry of Corporate Affairs, Government of India vide its
General Notification No. S.O.301(E) dated 8th February 2011 issued
under Section 211(3) of the Companies Act, 1956 has exempted certain
classes of companies from disclosing certain information in their Notes
to Accounts. The Company being an 'export oriented company' is entitled
to the exemption. Accordingly , disclosures mandated by paragraphs
3(i)(a) and 3(ii)(d) of Part II, Schedule VI to Companies Act, 1956 has
not been disclosed.
11.2 (a) During the year, the terms of the existing investment of
7,500,000, 9% Redeemable Preference Shares of Rs 10 each (optionally
redeemable at the option of the issuer at premium of Rs 90/- per share
subject to compulsory redemption within 20 years from the date of
allotment), invested in MB SEZ Developer Limited, the subsidiary
company have been altered (with retrospective effect from 1st April
2009) to 7,500,000 9% Compulsorily Cumulative Convertible Preference
Shares of Rs 10 each fully paid up into Equity Shares with in a period
of 10 years from the original date of allotment i.e. 1st April, 2009 at
the option of the Company. The ratio of conversion would be decided at
the time of conversion.
11.2 (b) The terms of the existing 63,114,660, Redeemable Preference
Shares of Rs 10 each invested in Moser Baer Investments Limited, the
subsidiary company, during the year, have been altered to Compulsorily
Convertible Preference Shares into Equity Shares with in a period of 10
years from the original date of allotment i.e. 4th May, 2010 at the
option of the Company. The ratio of conversation shall be 1:1
13 Segment information
The company is primarily in the business of manufacture and sale of
Optical Storage Media. The other activities of the company comprise
creation/ replication and distribution of content, sales of consumer
electronic products and operations and maintenance of sector specific
Special Economic Zone for non-conventional energy.
As the single financial report contains both consolidated financial
statements and the seperate financial statements of Moser Baer India
Limited(the parent), segment information has been presented only on the
basis of consolidated financial statements of the year ended 31st March
2011. For details, refer Note no. 17 of consolidated financial
statement.
14 Service Income shown in the profit and loss account includes income
earned by the SEZ division of the Company in the form of lease rental
for assets given on lease and utility services provided to the entities
situated in the SEZ.
15 Employee Benefits
The Company has classified the various benefits provided to employees
as under - I Defined Contribution Plans Provident Fund
II State Plans
a. Employers' Contribution to Employee's State Insurance Act, 1948
b. Employers' Contribution to Employee's Pension Scheme, 1995
III Defined Benefit Plans
a). Contribution to Gratuity Funds à Life Insurance Corporation of
India
b). Leave Encashment
16 Foreign Currency Convertible Bonds
(a) The Company has bought back and cancelled Nil (Previous Year 35)
Zero Coupon Tranche A Convertible Bonds and Nil (Previous Year
70) Zero Coupon Tranche B Convertible Bonds (FCCBs) of the face value
of USD 100,000 each, the purchase being made with the approval of the
Reserve Bank of India, at a discount to the face value. This has
resulted in a saving (net of brokerage) of Rs. Nil (Previous Year Rs.
180,762,906) which has been reflected as part of Exceptional items.
(Refer Schedule 21) Consequent upon such buy back and cancellation, the
Company's obligation to convert the said Bonds into shares, if so
claimed by the Bond Holder and/or to redeem the same in foreign
currency, has come to an end vis-ÃÂ -vis the cancelled bonds.
Premium payable on redemption of FCCB accrued up to March, 31, 2011
calculated on prorata basis Rs. 1,064,331,621 (Previous Year Rs.
762,653,374) has been fully provided for and charged to Securities
Premium Account. In the event that the conversion option is exercised
by the holders of FCCB in the future, the amount of premium charged to
the Securities Premium Account shall be written back to Security
Premium Account.
19 Government Grant:
Ministry of New and Renewable Energy of the Government of India, as
part of its Jawaharlal Nehru Nation Solar Mission 2010 sanctioned a
Research and Development ('R&D') grant to the company for its project
'Development of CIGS solar cell pilot plant to achieve grid parity
solar cells'. One of the objectives of the grant is to develop low cost
solar cell module with an aim to meet grid parity by using Cu(InGa)Se2
solar cells. During the year, the company has received R&D grant of Rs
35,000,000 out of the total grant of Rs 71,050,000 being 50 % of the
total project equipment cost of Rs 14.21 crores.
Pending acquisition of the equipment, the grant received has been
disclosed in the financial statements as 'Government Grant' which shall
be adjusted to the cost of the specific fixed assets.
21 The Company has availed non-fund based limits from State Bank of
India, State Bank of Patiala, State Bank of Bikaner and Jaipur, Union
Bank of India, State Bank of Travancore, Punjab National bank, Vijaya
Bank, ING Vysya Bank Limited, Bank of Baroda, Exim Bank, State Bank of
Hyderabad and HDFC Bank aggregating to Rs. 3,669,168,311 (Previous Year
Rs. 4,483,200,000) which are secured by a first pari-passu charge on
the current assets of the Company and further secured by a second pari
- passu charge on fixed assets of the Company.
22 Corresponding figures for the previous year have been
regrouped/recast, wherever necessary to conform to current year
classification.
Mar 31, 2010
1 Contingent Liabilities
In respect of :-
1.1 Corporate guarantees given on behalf of the Subsidiary Companies:
Rs. 17,383,425,000 (Previous Year Rs. 22,405,393,000). Against these
guarantees loan amounts of Rs. 16,042,958,865 (Previous Year Rs.
16,119,391,787) have been availed by the subsidiary companies. (Refer
Note 11.3 below)
1.2 Disputed demands (Gross) in respect of:- 2009-10 2008-09
(Rs.) (Rs.)
Entry tax
[Amount paid under protest Rs. 1,688,086
(Previous Year Rs. 1,372,586) 126,302,825 125,320,785
paid through bank guarantee Rs. 1,882,668
(Previous Year Rs. NIL)]
Service Tax
[Amount paid under protest Rs. 2,953,470
(Previous Year Rs. 2,953,470) 148,498,311 148,498,311
Sales Tax
[Amount paid under protest Rs. 7,003,604
(Previous Year Rs. 4,597,150);
paid through bank guarantee
Rs. 24,987,468 (Previous Year
Rs.26,596,226)] 101,925,563 79,030,621
Custom duty and Excise duty
(including penalties)
[Amount paid under protest Rs. 594,598
(Previous Year Rs. 500,000);
paid through bank guarantee
Rs. 12,000,000 (Previous Year
Rs.12,000,000)] 317,114,020 304,594,526
Income Tax
[Amount paid under protest
Rs. 34,500,000 (Previous Year
Rs. 34,500,000)] 101,117,134 97,231,147
Total 794,957,853 754,675,390
1.3 Claims against the Company not acknowledged as debts: Rs.
21,743,068 (Previous Year Rs. 23,581,688).
The amount shown in 1.1 above represents guarantees given in the normal
course of the Companys operations and are not expected to result in
any loss to the Company on the basis of the beneficiary fulfilling its
ordinary commercial obligations.
The amounts shown in 1.2 and 1.3 above represent the best possible
estimates arrived at on the basis of available information. The
uncertainties and possible reimbursements are dependent on the outcome
of the different legal processes which have been invoked by the Company
or the claimants as the case may be and therefore cannot be predicted
accurately. The Company engages reputed professional advisors to
protect its interests and has been advised that it has strong legal
positions against such disputes.
2 (A) In February 2003, Moser Baer India Limited (Moser Baer), and
Imation Corporation Inc., USA (Imation), formed an associate Company
called Global Data Media FZ LLC (GDM). GDM is owned 51 % by Imation,
and 49% by Moser Baer. On October 27,2006, Imation filed a suit in
Minnesota, USA against Koninkiljke Philips Electronics NV (Philips)
seeking a Declaratory Judgement on the validity of the Cross License
Agreement (CLA) entered into with Minnesota Mining and Manufacturing
Co. (3M) and its assignment to Imation and its subsidiaries (including
GDM). Moser Baer supplies recordable media to GDM and Imation under the
ambit of CLA.
Philips filed a suit against Moser Baer in The Hague, Netherlands
challenging the status and validity of the CLA under which supplies of
recordable media have been made to Imation and its subsidiaries. With a
view to reinforce its stand on the CLA, Imation joined the proceedings
in the Netherlands as a party, to contest the suit.
In order to protect the rights arising out of various patent license
agreements executed between Moser Baer and Phillips, Moser Baer filed a
suit against Philips challenging the default notices issued by Philips
thereby pre-empting any possibility of termination of the
aforementioned license agreements.
The Company has during the year entered into a "Settlement Agreement"
with Philips and Imation thus bringing an end to all the disputes.
(B) The Company has also entered into a Capacity based Licensing
Agreement with Philips for payment of license fees on recordable media
for a period of four years, financial impact of which has been
considered in these financial statements.
2.2 Estimated value of contracts remaining to be executed on capital
account and not provided for (net of advances): Rs. 382.458,388
(Previous Year Rs. 457,684,344).
2.3 Letters of Credit opened by banks on behalf of the Company: Rs.
906,671,619 (Previous Year Rs. 591,249,975).
3 (A) Lease Obligations
The Company has entered into operating leases for its offices, guest
houses and employees residences that are renewable on a periodic basis
and are cancellable at Companys option. Total lease payments
recognized in the statement of Profit and Loss Account: Rs. 62,084,330
(Previous year Rs. 57,421,770). The total rent recovered on sub lease
during the year is Rs. 141,924 (Previous year Rs.478,341).
(B) Assets given on operating lease
During the previous year 2008-09, the Company had provided buildings on
lease to units operating in its SEZ division upto June 30,2008. Gross
carrying amount of buildings provided on lease is NIL (Previous Year as
on 30.06.2008 Rs.903,269,720) and accumulated depreciation is NIL
(Previous Year as on 30.06.2008 Rs. 16,831,406) Total depreciation
expense recognized in the statement of Profit and Loss Account: NIL
(Previous year Rs. 6,048,283).
4 General Description of Lease terms :
a. The Company has provided buildings and utilities on financial lease
to units operating in its SEZ division
b. Buildings are given on lease for a period of 20 years and utilities
are given for a period of 7-10 years. Apart from the regular lease
rental the Company has also taken interest free refundable security
deposits of Rs. 1,605,000,000 (Previous Year Rs 765,000,000) from the
lessee which is refundable at the end of the lease term.
5 Taxation
Provision for taxation has been made based on the relevant provisions
of the Income Tax Act,1961.
Deferred tax in respect of timing differences for undertakings enjoying
tax holiday period under section 10A and section 10B of the Income Tax
Act, 1961 have been recognised in the year in which they originate, to
the extent that such differences reverse after the tax holiday period.
6 Employees Stock Option Plan (ESOP) and Directors Stock Option Plan
(DSOP)
a) Employee Stock Option Plan-2004 & Directors Stock Option Plan-2005
The Company has granted options to its non-executive directors and
employees of the Company and its subsidiaries, to be settled through
issue of equity shares, at exercise prices that are equal to the market
price of the share on the date of the grant. The Options granted vest
over a period of maximum of four years from the date of grant.
Employee Stock Option Plan-2009
During the year the Company established a stock option plan called"
Moser Baer India Limited Stock Option Plan 2009". The plan was
established on September 8, 2009. The plan was setup to offer and grant
stock options, in one or more tranches, to employees and directors of
the Company as the compensation committee of the Company determine. The
exercise price of such options shall be market price on the date of
grant. All options, whether vested or unvested, granted to grantee
shall in any case expire after a period of seven years from the offer
date.
7 Related Party Transactions:
Key Management Personnel
Managing Director Mr. Deepak Puri
Whole Time Directors Mrs. Nita Puri, Mr. Ratul Puri
8 Earnings per share (EPS)
a) Calculation of Weighted Average number of equity shares
1. For Basic EPS
9 Segment information
The Company is primarily in the business of manufacture and sale of
Optical Storage Media. The other activities of the Company comprise
creation/ replication and distribution of content, sales of consumer
electronic products and operation and maintenance of sector specific
Special Economic Zone for non-conventional energy. The segment
revenues, results and assets of the other activities do not constitute
reportable segments under AS-17 and accordingly no disclosure is
required.
10 Service Income shown in the profit and loss account includes income
earned by the SEZ division of the Company in the form of lease rental
for assets given on lease and utility services provided to the entities
situated in the SEZ.
11 Foreign Currency Convertible Bonds
(a) The Company has bought back and cancelled 35 (Previous Year 260)
Zero Coupon Tranche A Convertible Bonds and 70 (Previous Year 250) Zero
Coupon Tranche B Convertible Bonds (FCCBs) of the face value of USD
100,000 each, the purchase being made with the approval of the Reserve
Bank of India, at a discount to the face value. This has resulted in a
saving (net of brokerage) of Rs. 180,762,906 (Previous Year Rs.
1,845,864,067) which has been reflected as part of Exceptional items.
(Refer Schedule 21) Consequent upon such buy back and cancellation, the
Companys obligation to convert the said Bonds into shares, if so
claimed by the Bond Holder and/or to redeem the same in foreign
currency, has come to an end vis-a-vis the cancelled bonds.
12 Pursuant to the notification issued by the Ministry of Corporate
Affairs dated March 31, 2009, the Company changed its accounting policy
relating to Foreign currency transaction as mentioned in accounting
policy 10 schedule 22 Part-A and exercised the option available under
the newly inserted paragraph 46 to the Accounting Standard AS-11 "The
Effect of Changes in Foreign Exchange Rates". As a result of this
change the Company had, during the previous year 2008-09,
i) in respect of exchange differences relating to long term liabilities
in foreign currency amounting to Rs. 221,094,421 (net of depreciation
and amortisation of Rs. 48,408,473 ) recognised in the Profit and Loss
Account for the previous year ended March 31,2008 adjusted against
opening revenue reserves as provided in the rules.
ii) capitalised exchange differences arising during the previous year
2008-09 amounting to Rs 661,534,060 and charged additional depreciation
for the previous year 2008-09 amounting to Rs 15,432,202 in respect of
the same.
iii) in respect of other cases, debited exchange differences arising
during the previous year 2008-09 amounting to Rs. 1,298,612,986, to
"Foreign Currency Monetary Item Translation Difference Account" and
amortised/ released exchange differences for the previous year 2008-09
amounting to Rs 488,305,074.
Had the accounting treatment as per Accounting Standard -AS 11
(Revised) been continued to be followed by the Company in the previous
year 2008-09, the net loss after tax for the previous year 2008-09
would have been higher by Rs. 1,456,409,774.
13 Based on the information available with the Company, the Company has
identified 47 vendors as Micro and small enterprises as defined in the
Micro, Small and Medium Enterprises Development Act, 2006. The balance
due to such vendors as at 31.03.2010 has been disclosed separately
under "Current Liabilities and Provisions" (Refer Schedule 12).
14 The Company has availed non-fund based limits from State Bank of
India, State Bank of Patiala, State Bank of Bikaner and Jaipur, Union
Bank of India, State Bank of Travancore, The Bank of Nova Scotia,
Punjab National bank, Vijaya Bank, ING Vysya Bank Limited, Bank of
Baroda, Exim Bank, State Bank of Hyderabad and HDFC Bank aggregating to
Rs. 4,483,200,000 (Previous Year Rs. 2,932,500,000) which are secured
by a first pari-passu charge on the current assets of the Company and
further secured by a second pari - passu charge on fixed assets of the
Company.
15 Corresponding figures for the previous year have been
regrouped/rearranged, wherever necessary to conform to current year
classification.