Mar 31, 2015
Dear Members,
The Directors submit their Report for the financial year ended 31st
March 2015.
STANDALONE FINANCIAL RESULTS
Year ended Year ended
PARTICULARS 31.03.2015 31.03.2014
(Rs. in Lakhs) (Rs. in Lakhs)
GROSS REVENUE 11040 24948
PROFIT BEFORE FINANCE COST
AND DEPRECIATION 117 1546
LESS : FINANCE COST 4348 4212
LESS : DEPRECIATION 415 618
PROFIT BEFORE TAX (4646) (3284)
LESS : PROVISION FOR TAX Â Â
PROFIT AFTER TAX (4646) (3284)
STATE OF COMPANY AFFAIRS AS ON 31ST MARCH, 2015
Primary activity of the Company is manufacturing and selling of
Speciality Power Cables. The Cable Division registered a gross sales
turnover of Rs 92 crores during the year as compared to Rs 205 crores
of previous year. The performance badly suffered on account of
non-availability of required working capital finance. Due to acute
shortage of working capital the Division focused on the business with
higher margins with a view to ensure best possible operating results
within its available means through its Shyamnagar Plant.
In line with BIFR approval, the sale of the project division had been
concluded on 17th June, 2014.
As reported in earlier years, pursuant to BIFR order in its hearing on
23rd August, 2011, your Company had been declared a Sick Industrial
Company in terms of Section 3(1)(O) of the Sick Industrial Companies
(Special Provisions) Act, 1985. BIFR had appointed Allahabad Bank as an
Operating Agency (OA). As per decision in the Joint Lenders' Meeting
dated 5th September, 2012 Ernst & Young (E&Y) was appointed for
economic viability assessment and development of Draft Rehabilitation
Scheme (DRS).
By the year end ie by 31st March,2015, in principle approval of DRS as
prepared and circulated by Ernst & Young in May 2013 had been received
representing around 85% of the value of the exposures of Secured
Lenders. The last approval was received on 17th March 2015. The
following developments have since taken place:-
i) Invocation of bank guarantees worth Rs 65 Crores contributed to
enhancement of fund based exposure of Banks.
ii) L/C devolvement amount have gone up by Rs 27 Crores vis-a-vis
projected at DRS on account of in-sufficient cash generation and
virtually no production / sales from January 2015.
The above two developments had necessitated revision of DRS. In terms
of direction of BIFR at its hearing on 1st July, 2015 revised DRS after
incorporating the actual financial results of the company upto the year
ended on 31st March, 2015 and additional liability arising out of
devolvement of L/C & BG as stated above have been prepared and
submitted to the Operating Agency enabling them to take the same
forward.
In the meanwhile the Company had to resort to temporary Suspension of
Work at both the manufacturing units at Baripada and Shyamnagar wef
23rd April, 2015 due to acute fund constraint.
DIVIDEND
In view of the loss suffered by the Company and the accumulated losses
of the previous years, your Directors cannot recommend any dividend on
Preference or Equity Shares.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report as required under the Listing
Agreement with the Stock Exchange is enclosed in Annexure A forming
part of this Report.
FINANCE
The overall financial result of the Company during the year under
review was adversely affected due to working capital constraint which
was prevalent throughout the year. The operations suffered for want of
funds. The working capital has virtually dried compelling the Company
to resort to temporary suspension of work as stated above. It is
therefore necessary to get the revised DRS approved by all the lenders
and finally by BIFR for its implementation at the earliest and your
Company's management is at right earnest striving in this direction.
Status of Defaults in Financing Obligations as on 31st March 2015
1) Redemption of Preference shares:
3,37,000 Preference Shares of Rs.100/- each aggregating to Rs.
3,37,00,000/- issued and allotted by the Company to WBIDC had fallen
due. In addition, 18,46,000 Preference Shares of Rs. 100/- each for
Rs.18,46,00,000/- issued to TDB had also fallen due. In view of the
critical financial position of the Company and as per provisions of
Section 55 of Companies Act 2013 (relevant to Section 80 of the
Companies Act 1956) the Preference Shares were not redeemed.
2) Overdue Loan (including interest: Term Loan, Sales Tax Loan, Cash
Credit etc.)
Rs.
(in Lakhs)
a) IPICOL Â : 290.98
b) TDB Â Loan : 544.30
Royalty : 232.87
c) India SME Asset Reconstruction Co. Â : 630.76
d) SREI Â : 1289.29
e) WB Govt. : 1304.48
f) WBIDC : 299.41
g) ARCIL : 966.86
h) Consortium Banks : 9914.41
i) REL Utility Engineers Ltd : 185.33
15658.69
All categories of employees of the Company are continuing to subscribe
in Equity Shares of the Company through Nicco Restructuring Employees'
Trust Fund (NRETF) by deduction of 10% of their Salary.
Allottment of 50,00,000 Equity Shares of Rs 2/- each for cash at par
aggregating to Rs 1,00,00,000/- to NRETF is pending approval of Stock
Exchange.
BOARD AND COMMITTEE MEETINGS
Five Board Meetings were convened and held during the year.
The Board has constituted an Audit Committee with Mr Narottam Das as
Chairman and Mr Prabir Chakravarti, Mr Sujit Poddar and Mr Manash
Chakraborty as Members. However the nomination of Mr Manash Chakraborty
by Asset Reconstruction Company (India) Ltd., as Nominee Director of
the Company and consequently as member of the Audit Committee has been
withdrawn with effect from 10th April, 2015. There have not been any
instances during the year when recommendations of the Audit Committee
were not accepted by the Board.
Details of the composition of the Board and its Committees and of the
Meetings held and attendance of the Directors at such Meetings, are
provided in the Corporate Governance Report. The intervening gap
between the Meetings was within the period prescribed under the
Companies Act, 2013 and the Listing Agreement.
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to clause (c) of sub-section (3) and sub-section (5) of
section 134 of the Companies Act, 2013, your Directors confirm thatÂ
(a) in the preparation of the annual accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures;
(b) the directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the company at the end of the financial year and of the loss of the
company for that period;
(c) the directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the company and
for preventing and detecting fraud and other irregularities;
(d) the directors have prepared the annual accounts on a going concern
basis;
(e) the directors have laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequate and were operating effectively; and
(f) the directors have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
STATUTORY AUDITORS, THEIR REPORT AND NOTES TO THE FINANCIAL STATEMENTS
Your Company's Statutory Auditors, Messrs G Basu & Co., Chartered
Accountants, Kolkata, were appointed at the 31st Annual General Meeting
held on 29th September, 2014 and shall hold office until the conclusion
of the forthcoming Annual General Meeting and being eligible are
recommended for re-appointment at the forthcoming Annual General
Meeting and the authority be given to the Board to fix their
remuneration.
The Company has received the consent/confirmation of Messrs G Basu & Co
for their re-appointment as statutory auditors and a certificate from
them to the effect that their re-appointment, if made, would be in
accordance with all the conditions prescribed under the Companies Act,
2013 and Companies (Audit & Auditors) Rules, 2014 and that they are not
disqualified for re-appointment.
As required under clause 41 of the Listing Agreement, the Auditors have
also confirmed that they hold a valid certificate issued by the Peer
Review Board of the Institute of Chartered Accountants of India.
The notes on accounts referred to in the Auditor's Report are
self-explanatory and therefore, do not call for any further comments.
SECRETARIAL AUDIT
Pursuant to Section 204 of the Companies Act, 2013, and the rules made
there under, Mr. P.V. Subramanian (C.P. No.- 2077; ACS- 4585), Company
Secretary in Whole-time Practice, was appointed as the Secretarial
Auditor of the Company for the Financial Year 2014-15. The report of
the Secretarial Auditor is enclosed as Annexure I. The report is
self-explanatory and do not call for any further comments.
RELATED PARTY TRANSACTION
All transactions entered with Related Parties during the financial year
were on an arm's length basis and were in the ordinary course of
business and the provisions of Section 188 of the Companies Act, 2013
are not attracted. Thus, disclosure in Form AOC-2 is not required.
Further, there are no materially significant related party transactions
during the year under review made by the Company with Promoters,
Directors, Key Managerial Personnel or other designated persons which
may have a potential conflict with the interest of the Company at
large.
The policy on Related Party Transactions as approved by the Board is
uploaded on the Company's website and may be accessed at the link
http://www.niccogroup.com/related-party-transactions- policy.
RISK MANAGEMENT & MITIGATION
The Company has identified various risks faced by the Company from
different areas. The Company already has a Risk Management Framework
for laying down procedures to inform the Board members about the risk
assessment and minimization procedures. The Board has adopted a risk
management policy for identification of elements of risk in
consultation with various functional heads to identify, assess and
mitigate the major areas of risk associated with the business of the
Company. Appropriate structures are present so that risks are
inherently monitored and controlled. Risk identification, risk
assessment and risk treatment procedures for all functions of the
Company are reviewed on an ongoing basis.
The Audit Committee and the Board reviews the Risk Management Framework
on regular basis.
DECLARATION BY INDEPENDENT DIRECTORS
Mr. Narottam Das, Mr. Prabir Chakravarti, Mr. Sujit Poddar, Dr Dilip
Kumar Datta, Mr. Tapan Chaki, Mr Sanjay Kumar Bansal and Dr
Sourendranath Ghosal, Independent Directors of the Company have
confirmed that they fulfill all the conditions of Independent
Directorship as laid down in section 149 of the Companies Act, 2013 and
the rules made there under and the same have been noted by the Board at
its meeting held on 19th May, 2015.
INTERNAL FINANCIAL CONTROLS
Your company has in place an established internal control system
designed to ensure proper recording of financial and operational
information and compliance of various internal control and other
regulatory and statutory compliances. Internal Financial Control
systems and procedures are commensurate with the company's size and
nature of business. The objective of these procedures is to ensure
efficient use and protection of the company's resources, accuracy in
financial reporting and compliance of statutes and company procedures.
The existing system ensures orderly and efficient conduct of its
business including adherence to company's policies, safeguarding of its
assets, prevention and detection of frauds and errors, accuracy and
completeness of the accounting records, and timely preparation of
reliable financial information.
The Internal Financial Control systems and procedures and their
effectiveness are monitored by the Audit Committee of the Board of
Directors of the Company on a periodic basis.
DIRECTORS
Appointment & Cessation
Dr Tridibesh Mukherjee resigned from the Board of Directors with effect
from 15th September, 2014. Your Directors place on record their
appreciation for the valuable services rendered to the Company by Dr
Tridibesh Mukherjee during his tenure as Director of the Company.
Mr Sanjoy Bhattachaya resigned from the Board of Directors with effect
from 15th September, 2014. Your Directors place on record their
appreciation for the valuable services rendered to the Company by Mr
Sanjoy Bhattachaya during his tenure as Director of the Company.
On account of health grounds, Mr Swapan Kumar Mukherjee has resigned as
Managing Director of the Company at the Board Meeting of the Company
held on 19th May, 2015 and he would be released on the close of business
hours of 30th September, 2015. Your Directors place on record their
appreciation for the valuable services rendered to the Company by Mr
Swapan Kumar Mukherjee during his tenure as Managing Director of the
Company.
On the recommendation of the Nomination & Remuneration Committee, the
Board of Directors of the Company at its Meeting held on 13th August,
2015 has appointed Mr Kartick Kumar Chatterjee as an Additional
Director of the Company with effect from 28th September, 2015. Mr
Kartick Kumar Chatterjee holds Office as a Director of the Company till
the date of the ensuing Annual General Meeting. The Company has
received a Notice in writing with the requisite deposit from a Member
in terms of Section 161 of the Companies Act, 2013, signifying his
intension to propose the appointment of Mr Kartick Kumar Chatterjee as
a Director of the Company at the forthcoming Annual General Meeting.
The Board of Directors of the Company at its Meeting held on 13th
August, 2015 has appointed Mr Kartick Kumar Chatterjee as a Managing
Director & CEO of the Company for a period of three years with effect
from 1st October, 2015 to 30th September, 2018 subject to the approval
of the Members of the Company in General Meeting and such other
approvals / clearances as may be required. The Board of Directors of
the Company at its Meeting held on 29th September, 2014 appointed Mr
Sanjay Prakash Bansal as an Additional Director designated as
Independent Director of the Company with effect from 29th September,
2014 pursuant to the provisions of section 161(1) of the Companies Act,
2013 and Article 124 of the Articles of Association of the Company.
Mr Sanjay Prakash Bansal resigned from the Board of Directors with
effect from 12th August, 2015. Your Directors place on record their
appreciation for the valuable services rendered to the Company by Mr
Sanjay Prakash Bansal during his tenure as Director of the Company
The Board of Directors of the Company at its Meeting held on 29th
September, 2014 appointed Dr Sourendra Nath Ghosal as an Additional
Director designated as Independent Director of the Company with effect
from 29th September, 2014 pursuant to the provisions of section 161(1)
of the Companies Act, 2013 and Article 124 of the Articles of
Association of the Company Dr Ghosal holds Office as Director of the
Company upto the date of the ensuing Annual General Meeting.
The Company has received a Notice in writing along with the requisite
deposit from a Member in terms of Section 160(1) of the Companies Act,
2013, signifying his intension to propose the appointment of Dr
Sourendra Nath Ghosal as a Director of the Company at the forthcoming
Annual General Meeting.
Dr Ghosal is an Independent Director of the Company pursuant to Section
149 of the Companies Act, 2013 and Clause 49 of the Listing Agreement
with the Stock Exchange.
Sub-section (10) of Section 140 of the Companies Act, 2013, provides
that Independent Directors shall hold office for a term of five
consecutive years on the Board of a company and shall be eligible for
re-appointment on passing a special resolution by the shareholders of
the company.
Sub-section (11) states that no Independent Director shall be eligible
for more than two consecutive terms of five years. Sub-section (13)
states that the provisions of retirement by rotation as defined in sub
sections (6) and (7) of Section 152 shall not apply to such Independent
Directors.
Accordingly, Dr Sourendra Nath Ghosal being eligible is proposed to be
appointed as Non-Executive (Independent) Director for a term of five
consecutive years on the Board of Directors of the Company
Asset Reconstruction Company (India) Limited (ARCIL) had withdrawn the
Nomination of Mr Manash Chakraborty as its Nominee Director with effect
from 10th April, 2015. Your Directors place on record their
appreciation for the valuable services rendered to the Company by Mr
Manash Chakraborty during his tenure as Director of the Company.
Mr Niraj Kela and Ms Pallavi Priyadarshini Kaul, retire by rotation at
the forthcoming Annual General Meeting and being eligible offer
themselves for re-appointment.
A brief resume of the Directors proposed to be appointed /
re-appointed, nature of their expertise in specific functional areas
and names of Companies in which they hold Directorships and Memberships
/ Chairmanships of Board / Committees, as stipulated under clause
49(VIII)(E) of the Listing Agreement with the Stock Exchange, are
provided in the Notice convening the 32nd Annual General Meeting of the
Company.
COMPANY'S POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The remuneration policy of the Company, inter alia, includes the aims
and objectives, principles of remuneration, guidelines for remuneration
to Executive Directors and Non-Executive Directors, fixed and variable
components in the remuneration package, criteria for identification of
the Board Members and appointment of senior. management.
The remuneration policy is in consonance with the requirements of
section 178 of the Companies Act, 2013 and Rules thereto and the
existing industry practice
The criteria for identification of the Board Members including that for
determining qualification, positive attributes, independence etc., are
summarily given hereunder :
* The Board Member shall possess appropriate skills, qualification,
characteristics and experience. The objective is to have a Board with
diverse background and experience in business, governance, academics,
technology, human resources, social responsibilities, finance, law
etc., and in such other areas as may be considered relevant or
desirable to conduct the Company's business in a holistic manner.
* Independent director shall be person of integrity and possess
expertise and experience and/or someone who the Committee/ Board
believes could contribute to the growth/philosophy/strategy of the
Company.
* In evaluating the suitability of individual Board Members, the
Nomination & Remuneration Committee takes into account many factors,
including general understanding of the Company's business dynamics,
global business, social perspective, educational and professional
background and personal achievements.
* Director should possess high level of personal and professional
ethics, integrity and values. He should be able to balance the
legitimate interest and concerns of all the Company's stakeholders in
arriving at decisions, rather than advancing the interests of a
particular constituency.
* Director must be willing to devote sufficient time and energy in
carrying out their duties and responsibilities effectively. He must
have the aptitude to critically evaluate management's working as part
of a team in an environment of collegiality and trust.
* The Committee evaluates each individual with the objective of having
a group that best enables the success of the Company's business and
achieve its objectives.
FIXED DEPOSITS
Your Company has not accepted any deposits from the public.
PARTICULARS OF EMPLOYEES & RELATED DISCLOSURES
Your Company has no employee of the category as specified in Rule 5(2)
of the Companies (Appointment and Remuneration of Managerial Personnel)
Rule, 2014. Disclosure pertaining to remuneration and other details as
required under Section 197(12) of the Companies Act, 2013 read with
Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules,2014 are provided in Annexure - B.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Your Company has not given any loan or guarantee or has not made any
investments under section 186 of the Companies Act, 2013 during the
year under review.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
As required under provisions of the Companies Act, 2013 and Rule 8(3)
of Companies (Accounts) Rules, 2014 details relating to Conservation of
Energy, Technology Absorption and Foreign Exchange Earnings and Outgo
are given in the Annexure - C, which is annexed hereto and forms part
of the Directors' Report.
RESEARCH AND DEVELOPMENT
The R&D Centre of the Company has been focussing on development of
products and cost effective compounds for specialized cables and
Electron Beam Irradiated Cables. The Company has successfully developed
Air Craft Carrier Cable and Pressure Tight Cable for the Submarine
Development Programme for Indian Navy. Besides the above the cable for
solar energy has been taken up for development. Also battery cable for
automobile has been developed pending final approval from the relevant
authority.
CORPORATE GOVERNANCE
Your Company has strictly observed the principles of good Corporate
Governance through accountability and transparency.
A separate report on Corporate Governance as prescribed in the Listing
Agreement of the relevant Stock Exchange forms part of the Annual
Report 2014-15 along with the Auditors' statement on its compliance
(Annexure D).
COMPLAINTS RECEIVED BY THE SEXUAL HARASSMENT COMMITTEE
The Company has in place a policy in line with the requirements of The
Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set
up to redress complaints received regarding sexual harassment. All
employees (permanent, contractual, temporary, trainees) are covered
under this Policy. No complaints received during the year and no
complaints were pending to be resolved as on 31.03.2015.
ANNUAL EVALUATION OF BOARD'S PERFORMANCE
In compliance with the Schedule IV of the Companies Act, 2013, a
meeting of the Independent Directors of the Company was held on 11th
February, 2015 to review and evaluate the performance of the
Non-Independent Directors, the Board as a whole and of the Chairman of
the Company taking into account the views of the executive directors
and non-executive Directors; to assess the quality, quantity and
timeliness of flow of information between the Company management and
the Board and also to review the overall performance of the Board.
The Board of Directors of the Company at its Meeting held on 13th
February, 2015 has evaluated the performance of all Independent
Directors individually and found them un-biased, constructive,
beneficial and adding value to the cause of the Company.
WHISTLE BLOWER POLICY (Vigil Mechanism)
Pursuant to section 177(9) of the Companies Act, 2013, read with rule 7
of the Companies (Meetings of Board and its Powers) Rules, 2014 and
clause 49 of the Listing Agreement, the Company has adopted a Whistle
Blower Policy (Vigil mechanism) for Directors and Employees of the
Company to report their genuine concerns or grievances to deal with
unethical behavior, actual or suspected fraud or violation of the
Company's code of conduct or ethics policy. The policy was approved by
the Board of Directors of the Company at its meeting held on 14th
August, 2014 and the Audit Committee was empowered by the Board of
Directors to monitor the same and to report to the Board about the
complaints in an unbiased manner. The policy has also been uploaded on
the website of the Company at the link
http://www.niccogroup.com/Financial Results/Nicco Corporation Limited/
Vigil Mechanism.
FUTURE PROSPECTS
Your Directors are confident that through revised DRS a suitable
restructuring scheme would be worked out for the revival of the Company
under the auspices of BIFR.
KEY MANAGERIAL PERSONNEL
The Key Managerial Personnel (KMP) in the Company as per Section 2(51)
and 203 of the Companies Act, 2013 are as follows:- Mr Swapan Kumar
Mukherjee, Managing Director, Mr Prasanta Pandit, CFO and Mr Indranil
Mitra, General Manager & Company Secretary.
EXTRACT OF ANNUAL RETURN
Pursuant to section 92(3) of the Companies Act, 2013 and Rule 12(1) of
the Companies (Management and Administration) Rules, 2014, extract of
the Annual Return in the Form MGT - 9 forms part of this report in
Annexure - II.
CAUTIONARY STATEMENT
Statements in the Directors' Report in regard to projections, estimates
and expectations have been made in good faith. Many unforeseen factors
may come into play and affect the actual results, which could be
different from what the Directors envisage in terms of future
performance and outlook. Industry information contained in this Report,
have been based on information gathered from various published and
unpublished reports and their accuracy, reliability and completeness
cannot be assured.
COST AUDITORS
Pursuant to the directives of the Central Government M/s S Roy
Choudhury & Co., Cost Accountants, have been appointed to conduct Cost
Audits relating to cables manufactured by the Company.
ACKNOWLEDGEMENT
Your Directors wish to record their sincere appreciation of the efforts
put in by all the employees and their commitment during the year in a
very difficult and uncertain time which the Company is passing through.
Your Directors also take this opportunity to acknowledge the
cooperation and assistance of Banks, Financial Institutions, Technology
Development Board, Government of India, Government of West Bengal,
WBIDC and BIFR. Finally, your Directors owe their gratitude to all the
Shareholders and Debenture Holders for their continued support to the
Company.
On behalf of the Board of Directors
Place : Kolkata RAJIVE KAUL SWAPAN KUMAR MUKHERJEE
Dated, the 13th day Chairman Managing Director
of August, 2015
Mar 31, 2014
Dear Members,
The Directors present herewith their Report together with the Audited
Accounts of your Company for the year ended 31st March 2014. ''
A. FINANCIAL RESULTS & APPROPRIATIONS (Rs. Lakhs)
2013-14
Gross Revenue : 24948
Gross Profit/(Loss) for the year : 1547
Less: Depreciation : 618
Profit/Loss after depreciation : 929
Less: Finance cost- : 4213
Profit/(Loss) before Tax : (3284)
Considering the critical financial position of the Company, the
performance of Cables Division of your Company can be rated as
satisfactory. Operating profit i.e. profit before Finance Cost,
Depreciation and Tax of Cables Division during the year under review
was Rs 24.49 crores. The performance of Project Division could not be
improved due to lack of order as it is difficult to meet the
qualification criteria in most tenders owing to your Company''s negative
net worth. The division thus suffered due to its inability to
participate in most public tenders of PSUs and Government bodies.
Project Division incurred a loss of Rs 9.02 crores before Finance Cost,
Depreciaion and Tax. The division has now been sold with effect from
17th June, 2014 to the eligible bidder as per recommendation of Asset
Sale Committee (ASC) constituted by the Board for Industrial and
Financial Reconstruction (BIFR).
As earlier reported, pursuant to BIFR order in its hearing on 23rd
August, 2011, your Company had been declared a Sick Industrial Company
in terms of Section 3(l)(0) of the Sick Industrial Companies (Special
Provisions) Act, 1985. BIFR had appointed Allahabad Bank as the
Operating Agency (OA). As per decision in the Jt. Lenders'' Meeting
dated 5th September, 2012, Ernst & Young (E&Y) had been appointed for
economic viability assessment and development of Draft Rehabilitation
Scheme (DRS). DRS, as prepared by E&Y had been circulated to all the
secured lenders. BIFR had directed the Operating Agency (OA) to hold a
Jt. Lenders'' Meeting to sort out issues of Secured Lenders in
relation to settlement of their dues as incorporated in the DRS. In the
Jt. Lenders'' Meeting (JLM) held on 6th November 2013 and 25th June,
2014, status of approval of DRS by various lenders was reviewed.
Allahabad Bank as OA emphasised the urgent need of approval of DRS and
requested all the Lenders to obtain their internal approval. Your
Company is. pursuing with all the Secured Lenders for their approval of
DRS. Allahabad Bank has accorded their approval with some modifications
to the DRS.
BIFR in its hearing on 9th October, 2013 had constituted two ASC''one
for dealing with Sale of Project Division arising out of AAIFR Order
and the other one for Sale of a few old Cars. Process of Sale had been
undertaken by both ASCs, through publication of Tender Notice in
newspapers on 10th February, 2014. Both Sales have now been concluded.
B. DIVIDEND
In view of the loss suffered by the Company and the accumulated Josses
of the previous years, your Directors cannot recommend any dividend on
Preference or Equity Shares.
C. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report as required under the Listing
Agreement with the Stock Exchange is enclosed in Annexure A forming
part of this Report.
D. FINANCE
The overall financial result of the Company during the year under
review was adversely affected due to working capital constraint which
was prevalent throughout the year. The operations suffered for want of
funds. Accordingly the Management initiated the following actions viz.
(i) to focus on high contribution products and (ii) to emphasise on
reduction of operation cycle. Unfortunately the working capital gap was
too large. However, the management actions yielded some results to
contain the operational loss to the present level. Delay in hiving off
of Project Division had compounded the problem. The working capital
position in the current year would be far more critical due to
continuing losses. It is therefore necessary to get the DRS approved by
all the lenders and finally by BIFR for its implementation at the
earliest and your Company''s management is at right earnest striving
in this direction.
The installment payments for redemption of Preference Shares of WBIDC
and TDB had fallen due. Due to inability to pay the installment, your
Company submitted restructuring proposal to WBIDC and TDB, which is yet
to be approved. However these issues are being addressed in the DRS.
Out of the fresh funds mobilized by issue of Equity Shares to Nicco
Restructuring Employees'' Trust Fund (NRETF), the Company was able to
make available some funds for much needed Capital Expenditure.
Additional capex requirements and source of funding have been
considered in DRS prepared by E&Y. Incidentally it may be mentioned
that the employees of the Company are continuing to subscribe in Equity
Shares of the Company through NRETF by deduction of 10% of their
Salary.
During the year your Company has issued and allotted 60,00,000 Equity
Shares of Rs 21- each for cash at par aggregating to Rs 1,20,00,000/-
to NRETF in accordance with the CDR approval.
E. PROJECT DIVISION
As earlier stated, Project Division of your Company has been sold to
the eligible Bidder named "Oriental Nicco Projects Pvt. Ltd." with
effect from 17th June, 2014 along with 104 employees at a consideration
of Rs 9.51 crores. This sale was on the basis of a "Going Concern"
on an "As is where is basis" which interalia included four on-going
Projects.
F. FIXED DEPOSITS
Your Company has not accepted any fixed deposits during the period
under review, as such there are no outstanding of overdue deposits as
on 31st March, 2014.
G. SUBSIDIARY
Your Company has no subsidiary as on 31st March, 2014.
H. ENERGY CONSERVATION
The details relating to energy conservation requirements of section
217(1 )(e) of the Companies Act, 1956 are not applicable.
I. RESEARCH AND DEVELOPMENT
Details in regard to Research and Development are shown in Annexure B.
J. FOREIGN EXCHANGE EARNINGS AND OUTGO
Details of foreign exchange earnings and outgo are shown in Annexure B.
K. CORPORATE GOVERNANCE
Your Company has strictly observed the principles of good Corporate
Governance through accountability and transparency.
A separate report on Corporate Governance as prescribed in the Listing
Agreement of the relevant Stock Exchange forms part of the Annual
Report 2013-14 along with the Auditors''statement on its compliance
(Annexure C). ''
L. TOTAL QUALITY AND ENVIRONMENT MANAGEMENT
Your Company''s factories at Shyamnagar and Baripada are accredited to
Quality Management System (QMS) under ISO 9001:2008 and Environment
Management System (EMS) under ISO 14001:2004. Both the systems continue
to be maWained through periodic Internal Audit by a team of trained
Internal Auditors and by Re-Certification/Surveillance Audits conducted
by Indian Register of Quality Systems (IRQS).
M. FUTURE PROSPECTS
Your Directors are confident that through DRS a suitable restructuring
scheme would be worked out for the revival of the Company under the
auspices of BIFR.
N. DIRECTORS
Mr Manash Chakraborty, Group Head, Asset Reconstruction Company (India)
Ltd. (ARCIL) was appointed as an Additional Director of the Company
pursuant to the provisions of section 161(1) of the. Companies Act,
2013 and Article 124 of the Articles of Association of the Company with
effect from 12th February, 2014, as the Nominee Director of ARCIL, Mr
Manash Chakraborty . holds office as Director of the Company upto the
date of the ensuing Annual General Meeting. The Company has received a
Notice in writing along with the requisite deposit from a Member, in
terms of Section 160(1) of the Companies Act, 2013, signifying '' his
intention to propose the appointment of Mr Manash Chakraborty, as a
Director of the Company at the forthcoming Annual General Meeting.
On the recommendation of the Compensation & Remuneration Committee, the
Board of Directors of the Company at its Meeting held on 24th
September, 2013 had appointed Mr Swapan Kumar Mukherjee as an Executive
Director (Non-Board appointment) of the Company with effect from 26th
September, 2013.
Mr Udayan Ray had crossed the normal retirement age of 60 years and he
had expressed his desire not to offer himself for appointment for a
fresh term as the Managing Directors CFO of the Company on expiry of
his term on 31st March, 2014. He was appointed as a Director as well as
Non Executive Vice Chairman of the Company with effect from 1st April,
2014.
Your Directors place on record their appreciation for the valuable
services rendered to the Company by Mr Udayan Ray during his tenure as
Managing Director & CFO of the Company.
On the recommendation of the Compensation & Remuneration Committee, the
Board of Directors of the Company at its Meeting held on 12th February,
2014, had appointed Mr Swapan Kumar Mukherjee, as an Additional
Director of the Company with effect from 1st April, 2014. Mr Swapan
Kumar Mukherjee holds Office as a Director of the Company till the date
of the ensuing Annual General Meeting. The Company has received a
Notice in writing with the requisite deposit from a Member, in,terms of
Section 161 of the Companies Act, 2013 signifying his intention to
propose the appointment of Mr Swapan. Kumar Mukherjee, as a Director of
the Company at the forthcoming Annual General Meeting.
The Board of Directors of the Company at its Meeting held on 12th
February, 2014, appointed Mr Swapan Kumar Mukherjee as a Managing
Director of the Company for a period of three years with effect from
1st April, 2014 to 31st March, 2017 subject to the approval of the
Members of the Company in General Meeting and such other
approvals/clearances as may be required.
An abstract of the terms of appointment and remuneration payable to Mr
Swapan Kumar Mukherjee was dispatched to the '' Members under section
302 of the Companies Act, 1956. ''
The Board of Directors of the Company at its Meeting held on 14th
August, 2014, appointed Mr Tapan Chaki as an Additional Director of the
Company with effect from 14th August, 2014, pursuant to the provisions
of section 161(1) of the Companies Act, 2013 and Article 124 of the
Articles of Association of the Company. Mr Tapan Chaki holds Office as
Director of the Company up j to the date of the ensuing Annual General
Meeting.
The Company has received a Notice in writing along with the requisite
deposit from a Member, in terms of section 160(1) of the : Companies
Act, 2013, signifying his intention to propose the appointment of Mr
Tapan Chaki as a Director of the Company at the
forthcoming Annual General Meeting. ,
Mr Chaki is an Independent Director of the Company pursuant to section
149 of the Companies Act, 2013 and clause 49 of the Listing Agreement
with the Stock Exchange, ¦
The Companies Act, 2013 provides for appointment of Independent
Directors. Sub-section (10) of Section 149 of the Companies Act, 2013
(effective April 01,2014) provides that Independent Directors shall
hold office for a term of five consecutive years on the Board of a
company and shall be eligible for re-appointment on passing a special
resolution by the shareholders of the company. Sub-section (11) states
that no Independent Director shall be eligible for more than two
consecutive terms of five years. Sub- section (13) states that the
provisions of retirement by rotation as defined in sub sections (6) and
(7) of Section 152 shall not apply to such Independent Directors.
Accordingly, Mr Narottam Das, Mr Prabir Chakravarti, Mr Sujit Poddar,
Dr Dilip Kumar Datta and Mr Tapan Chaki being eligible are proposed to
be appointed as Non-Executive (Independent) Directors for a term of
five consecutive years on the Board of Directors of the Company.
As per Section 149(13) of the Companies Act, 2013, the provisions in
respect of retirement of Directors by rotation shall not be applicable
to appointment of Independent Directors.
Your Company has five Independent Directors in terms of Section 149(6)
of the Companies Act, 2013. Therefore the number of Non-Independent
Directors, who shall be counted for the purpose of retirement of
Directors by rotation stands at nine including two Directors nominated
by the lenders in which case one third of the nine Directors comes to
three.
Accordingly, Mr Rajive Kaul, Mr Sanjoy Bhattacharya and Dr Tridibesh
Mukherjee, retire by rotation at the forthcoming.Annual General Meeting
and being eligible offer themselves for re-appointment.
A brief resume of the Directors proposed to be appointed/re-appointed,
nature of their expertise in specific functional areas and names of
Companies in which they hold Directorships and
Memberships/Chairmanships of Board/Committees, as stipulated under
clause 49(1V)(G) of the Listing Agreement with the Stock Exchange, are
provided in the Notice convening the 31st Annual General Meeting of the
Company.
O. EXPORTS
During the year under review there has been no export. .
P. DIRECTORS''RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956 and in respect
of the annual accounts for the year under review, your Directors hereby
confirm :
1. that in the preparation of the Annual Accounts, the applicable
Accounting Standards have been followed;
2. that your Directors have selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the year ended 31 st March,
2014 and of the profit of the Company for that period;
3. that your Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
4. that your Directors have prepared the Annual Accounts on a going
concern basis.
Q. PARTICULARS OF EMPLOYEES
Your Company did not employ any person whose particulars are required
to be attached to this Report under Rule 5 of the
. Companies (Appointment & Remuneration) Rules, 2014.
R. TEAM OF SENIOR MANAGEMENT PERSONNEL
Apart from Managing Director, the Team of Management Personnel of the
Company include Mr S K Pal, Executive Director,
Mr V R Moza, President (Marketing), Mr A K Ghosh, President
(Operations), Mr Kartick Chatterjee, President (Corporate Affairs &
Legal), Mr Prasanta Pandit, Chief Financial Officer and Mr Indranil
Mitra, General Manager & Company Secretary who are to be reckoned as
Managerial Personnel/Officer within the meaning of Clause 49 of the
Listing Agreement, SEBI (Prohibition of Insider Trading) Regulations,
1992 and Section 2(30) of the Companies Act, 1956.
S. AUDITORS
The Statutory Auditors of your Company M/s G Basu & Co., Chartered
Accountants, retire at the forthcoming Annual General Meeting and,
being eligible, offer themselves for re-appointment. Your Directors
recommend the re-appointment of M/s G Basu &
Co., as Statutory Auditors of the Company and their remuneration needs
to be fixed.
T. AUDITORS'' REPORT
The Comments made by the Auditors in their report have been duly
explained in the attached Notes to Accounts and hence do not need to be
dealt with here.
U. COST AUDITORS
Pursuant to the directives of the Central Government under the
provisions of section 233B of the Companies Act, 1956, M/s S Roy
Choudhury & Co., Cost Accountants, have been appointed to conduct Cost
Audits relating to cables manufactured by the Company. Their
remuneration needs to be fixed.
V. ACKNOWLEDGEMENTS
Your Directors wish to record their sincere appreciation of the efforts
put in by all the employees and their commitment during the year. Your
Directors also take this opportunity to acknowledge the cooperation and
assistance of Banks, Financial Institutions, Technology Development
Board, Government of India, Government of West Bengal, WBIDC, CDR Cell
and BIFR. Finally, your Directors owe their gratitude to all the
Shareholders and Debenture Holders for their continued support to the
Company.
On behalf of the Board of Directors
Place: Kolkata . RAJIVE KAUL SWAPAN KUMAR MUKHERJEE
Dated, the 14th day of August, 2014 Chairman Managing Director
Mar 31, 2013
The Directors present herewith their Report together with the Audited
Accounts of your Company for the year ended 31st March 2013.
A. FINANCIAL RESULTS & APPROPRIATIONS (Rs. Lakns)
2012-13
Gross Turnover 26952
Gross Profit/(Loss) for the year 2566
Less: Depreciation 640
Profit/Loss after depreciation 1926
Less : Finance cost 4429
Profit/(Loss) before Tax (2503)
The performance of Cables Division of your Company in particular
Shyamnagar unit, had improved and the operating profit before Interest,
Depreciation and Tax of Cables Division had registered an increase over
4% during the financial year. The performance of Project Division
suffered serious setback due to lack of order as it is difficult to
meet the qualification criteria in most tenders due to your Company''s
negative net worth. The division thus suffered due to its inability to
participate in most public tenders of PSUs and Government bodies. Your
Company had moved a Miscellaneous Application (MA) with BIFR for
formation of a Joint Venture Company with Project business between NCL
and Oriental Manufacturers Private Limited (OMPL) with a stake-holding
of 10% and 90% respectively. BIFR on hearing of the MA directed your
Company to come up with the total Draft Rehabilitation Scheme (DRS)
package instead of piecemeal proposals. Your Company thereafter moved
an appeal with AAIFR, since time was considered as the essence for such
strategic alliance. AAIFR hearing is still pending. As a result of all
these factors your Company suffered losses of Rs. 2503 lacs during the
year under review. The working capital position continued to remain
short and critical throughout the year. The situation had further
worsened due to continuous repayment of loans as per the CDR scheme.
Owing to the high debt burden, finance cost had further increased. The
interest cost was the major element of cost and had off-set the savings
achieved in operations and other fixed cost. The major challenge in the
current year would be to restrict further increase in finance cost
though this would be difficult until BIFR approves the DRS.
In response to the application filed before BIFR, your Company had been
declared sick by the order dated 7th September 2011 and Allahabad Bank
has been appointed as the Operating Agency (OA) for your Company to
work out the DRS package for submission to BIFR. In the joint lenders
meeting held on 5th September 2012 Ernst & Young (E&Y) was appointed to
study the viability and assist OA and the Company to prepare a DRS
Package. E&Y submitted their report along with the DRS. The lenders are
now discussing the DRS package proposed by E&Y.
B. DIVIDEND
In view of the loss suffered by the Company and the accumulated losses
of the previous years, your Directors cannot recommend any dividend on
Preference or Equity Shares.
C. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report as required under the listing
Agreement with the Stock Exclunge is enclosed in Annexure A.
D. FINANCE
The working capital position remained critical throughout the year as a
result the overall financial result was not satisfactory. The
operations suffered for want of funds. In view of the prevailing
critical fund position the management of your Company initiated a few
actions viz (i) to focus on high contribution products and (ii) to
emphasise on reduction of operation cycle. Unfortunately the working
capital gap was too large. The management actions yielded some results
to contain the operational loss to the present level. Further delay in
the decision of hiving off of Project Division by BIFR compelled your
Company to succumb to a higher loss compared to the last year. The
working capital position in the current year would be far more critical
due to the past losses. It is therefore necessary to get the DRS
approved by BIFR and impjemented at the earliest and your Company''s
management is striving in this direction.
The installment payments for Preference Shares of WBIDC and TDB had
fallen due. Due to inability to pay the installment, your Company
submitted restructuring proposal to WBIDC and TDB, which is yet to be
approved. However these issues are being addressed in the DRS. As per
approval of BIFR, 5,50,000 of Preference Shares of Rs.100 each and
72,00,080 Equity Shares of Rs.10 each of Nicco Biotech Limited, a
subsidiary of NCL had been sold in the current year. The proceeds
amounting to Rs. 11.94 crore have been kept in a ''no lien deposit
account'' with Allahabad Bank. The disbursement of the said money would
be done as per the direction of BIFR. Out of the fresh funds mobilized
by issue of Equity Shares to Nicco Restructuring Employees Trust Fund
(NRETF), the Company as per CDR scheme expended some funds for much
needed Capital Expenditure. Additional capex requirements and source of
funding have been considered in DRS prepared by E&Y.
During the year your Company has issued and allotted 1,10,00,000 Equity
Shares of Rs 21- each for cash at par aggregating to Rs 2,20,00,000/-
to NRETF in accordance with the CDR Approval.
E. FIXED DEPOSITS
Your Company has not accepted any fixed deposits during the period
under review, as such there are no outstanding of overdue deposits as
on 31 st March, 2013.
F. SUBSIDIARY
Your Company sold off its holding in the subsidiary Company, Nicco
Biotech Ltd. Subsequent to sale of shares of Nicco Biotech Limited,
your Company has no subsidiary as on 31st March, 2013 as such
attachment of accounts of subsidiary Company as required under Section
212 of the Companies Act, 1956 does not arise.
G. ENERGY CONSERVATION
The details relating to energy conservation requirements of section
217(1)(e) of the Companies Act, 1956 are not applicable.
H. RESEARCH AND DEVELOPMENT
Details in regard to Research and Development are shown in Annexure B.
I. FOREIGN EXCHANGE EARNINGS AND OUTGO
Details of foreign exchange earnings and outgo are shown in Annexure B.
J. CORPORATE GOVERNANCE
Your Company has strictly observed the principles of good Corporate
Governance through accountability and transparency.
A separate report on Corporate Governance as prescribed in the Listing
Agreement of the relevant Stock Exchange forms part of the Annual
Report 2012-13 along with the Auditors'' statement on its compliance
(Annexure C).
K. TOTAL QUALITY AND ENVIRONMENT MANAGEMENT
Your Company''s factories at Shamnagar and Baripada are accredited to
Quality Management System (QMS) under ISO 9001: 2008 and Environment
Management System (EMS) under ISO 14001:2004. Both the systems continue
to be maintained through periodic Internal Audit by a team of trained
Internal Auditors and by Re-Certification/Surveillance Audits conducted
by Indian Register of Quality Systems (IRQS).
L. FUTURE PROSPECTS
Your Directors are confident that through DRS a suitable revival
restructuring scheme would be worked out for the revival of the Company
under the auspices of BIFR.
M. DIRECTORS
Mr Udayan Ray, Dr Dilip Kamar Datta, Mr Sujit Poddar and Mr Shiv
Siddhant Narayan Kaul retire by rotation at the forthcoming Annual
General Meeting and being eligible, offer themselves for
re-appointment.
A brief resume of the Directors proposed to be appointed/re-appointed,
nature of their expertise in specific functional areas and names of
Companies in which they hold Directorships and
Memberships/Chairmanships of Board/Committees, as stipulated under
clause 49(IV)(G) of the Listing Agreement with the Stock Exchange, are
provided in the Notice convening the 30th Annual General Meeting of the
Company.
N. EXPORTS
During the year under review there had been no export.
O DIRECTORS'' RESPONSIBILITY PURSUANT TO SECTION 217(2AA) OF THE
COMPANIES ACT, 1956
Your Directors confirm :
1. that in the preparation of the Annual Accounts, the applicable
Accounting Standards have been followed;
2. that your Directors have selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the year ended 31st March, 2013
and of the profit of the Company for that period;
3. that your Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
4. that your Directors have prepared the Annual Accounts on a going
concern basis.
P. PARTICULARS OF EMPLOYEES
Your Company did not employ any person whose particulars are required
to be attached to this Report under Section 217(2A) of the Companies
Act, 1956.
Q. TEAM OF SENIOR MANAGEMENT PERSONNEL
Apart from Managing Director, the Team of Management Personnel of the
Company include Mr S K Pal, Executive Director, Mr V R Moza, President
(Marketing), Mr A K Ghosh, President (Operations), Mr Kartick
Chatterjee, Sr. Vice President (Corporate Affairs & Legal), Mr Prasanta
Pandit, Associate Vice President (Finance & Accounts) and Mr Indranil
Mitra, General Manager & Company Secretary who are to be reckoned as
Managerial Personnel/Officer within the meaning of Clause 49 of the
Listing Agreement, SEBI (Prohibition of Insider Trading) Regulations,
i992 and Section 2(30) of the Companies Act, 1956.
R. AUDITORS
The Statutory Auditors of your Company M/s G Basu & Co., Chartered
Accountants, retire at the forthcoming Annual General Meeting and,
being eligible, offer themselves for re-appointment. Your Directors
recommend the re-appointment of M/s G Basu & Co., as Statutory Auditors
of the Company and their remuneration needs to be fixed.
S. AUDITORS'' REPORT
The Comments made by the Auditors in their report have been duly
explained in the attached Notes to Accounts and hence do not need to be
dealt with here.
T. COST AUDITORS
Pursant to the directives of the Central Government under the
provisions of section 233B of the Companies Act, 1956, M/s S Roy
Choudhury & Co., Cost Accountants, have been appointed to conduct Cost
Audits relating to cables manufactured by the Company.
U. ACKNOWLEDGEMENTS
Your Directors wish to record their sincere appreciation of the efforts
put in by all the employees and their commitment during the year. Your
Directors also take this opportunity to acknowledge the cooperation and
assistance of Banks, Financial Institutions, Technology Development
Board, the Government of India, the Government of West Bengal and the
CDR Cell, BIFR. Finally, your Directors owe their gratitude to all the
Shareholders and Debenture Holders for their continued support to the
Company.
On behalf of the Board of Directors
Place : Kolkata RAJIVE KAUL UDAYAN RAY
Dated, the 12th
day of August, 2013 Chairman Managing Director
Mar 31, 2012
The Directors present herewith their Report together with the Audited
Accounts of your Company for the year ended 31st March 2012.
A. FINANCIAL RESULTS & APPROPRIATIONS (Rs. Lakhs)
2011-12 2010-11
Gross Turnover : 30840 30755
Gross Profit/(Loss) for the year : 2862 1328
Less: Depreciation : 660 706
Profit/Loss after depreciation : 2202 622
Less : Interest : 3370 2736
Profit/(Loss) before Tax : (1168) (2114)
Add : Deferred Tax Asset : - 573
Net Profit/(Loss) after Tax : (1168) (1541)
The initiatives taken by your Company for enhancement of productivity,
cost reduction and selective up-gradation of plant & machinery had
yielded result. The Cable Division registered a growth in turnover of
17.75% during the year in spite of the critical working capital
position. The turnover of the Project Division drastically fell
primarily due to its inability to paticipate in public tenders of PSUs
since the negative net-worth companies were not eligible to participate
in such tenders. As a result the division hardly received any order
during the year. The working capital position continued to remain
critical throughout the year. On the contraiy, the situation had
further worsened owing to commencement of repayment of loan as per the
CDR scheme. Owing to the high debt burden, interest cost has increased
by 9%. The interest cost is likely to further increase in the current
year unless another restructuring of finances is carried out.
In response to the application filed before BSFR, your Company has been
declared sick by the order dated 7th September 2011. Allahabad Bank has
been appointed as the Operating Agency for your Company to work out the
Debt Restructuring Scheme (DRS) package for submission to BIFR. Your
Company had signed a definitive agreement for a Joint Venture with M/s
Oriental Manufacturers Pvt Ltd (Oriental) for transfer of Project
business to a separate SPV and the same has been approved by you.
Oriental or it's subsidiary is to hold majority stake in the said
newly formed Company, and your Company being the minority stakeholder
therein. Your Company's proposal in this regard has been taken up
before AAIFR.
B. DIVIDEND
In view of the loss suffered by your Company and the accumulated losses
of the previous years, your Directors do not recommend any dividend on
Preference or Equity Shares.
C. Management Discussion and Analysis Report
Management Discussion and Analysis Report as required under the Listing
Agreement with the Stock Exchange is enclosed in Annexure A.
D. FINANCE
The factors mentioned earlier coupled with acute shortage of finance,
the financial results of your Company did not show much of improvement.
The instalment payments for Preference Shares of WBIDC had fallen due.
Due to inability to pay the instalment, your Company submitted
restructuring proposal to WBIDC, which is yet to be approved. TDB has
approved a package but unfortunately it is not in line with CDR
package. The shortage of working capital was a major issue during the
year. Out of the funds mobilized by sale of investments, your Company
as per CDR scheme earmarked some funds for much needed Capital
Expenditure. With the earmarked fund your Company could revamp the
wire-drawing section. Additional capex
. requirements and source of funding would be considered in DRS. .
The arbitration award in respect to the dispute with M/s Prysmian has
gone against your Company. Your Company is exploring . legal
possibilities for establishing the counter claims. However the
additional liabilities arising from the arbitration award has been
provided for in the books of accounts under review.
E. FIXED DEPOSITS
The balance unclaimed deposit as on 31st March, 2011, of Rs. 0.30 lakhs
was deposited with Investor's Education and Protection Fund during
the year.
F. SUBSIDIARY
The notes on your Company's subsidiary M/s Nicco Biotech Ltd. may be
read along with the Consolidated Financial Statements enclosed with the
Accounts, prepared in accordance with Accounting Standard 21. The
Ministry of Corporate Affairs, by General Circular No. 2/2011 dated 8th
February, 2011 has granted general exemption from the provisions of
Section 212(1) of the Companies Act, 1956 relating to the attachment of
the accounts of its subsidiary to the holding Company's Accounts.
Shareholders so desiring the Annual Accounts of your Company's
subsidiary may obtain the same upon request. The report and accounts of
the subsidiary M/s Nicco Biotech Ltd. will be kept for inspection at
your Company's registered office. Further, the report and accounts
of the subsidiary company will also be available at your Company's
website, www.niccogroup.com.
Nicco Biotech Limited has achieved a total income of Rs. 14.88 lakhs in
2011-12 as against Rs. 14.44 lakhs in 2010-11. The net loss after tax
has been Rs. 110.30 lakhs (Rs. 39.84 lakhs in 2010-11).
G. ENERGY CONSERVATION
The details relating to energy conservation requirements of section
217(1)(e) of the Companies Act, 1956 are not applicable.
H. RESEARCH AND DEVELOPMENT
Details in regard to Research and Development are shown in Annexure B.
I. FOREIGN EXCHANGE EARNINGS AND OUTGO
Details of foreign exchange earnings and outgo are shown in Annexure B.
J. CORPORATE GOVERNANCE
Your Company has strictly observed the principles of good Corporate
Governance through accountability and transparency.
A separate report on Corporate Governance as prescribed in the Listing
Agreement of the relevant Stock Exchange forms part of the Annual
Report 2011-12 along with the Auditor's statement on its compliance
(Annexure C).
K. TOTAL QUALITY AND ENVIRONMENT MANAGEMENT
Your Company's factories at Shyamnagar and Baripada are accredited to
Quality Management System (QMS) under ISO 9001:2008 and Environment
Management System (EMS) under ISO 14001:2004. Both the systems continue
to be maintained through periodic Internal Audit by team of trained
Internal Auditors and by Re-Certification/Surveillance Audits conducted
by Indian Register of Quality System (IRQS).
L. FUTURE PROSPECTS
Your Directors are confident that through DRS, a suitable revival
restructuring scheme would be worked out for the revival of the Company
under the auspices of BIFR.
M. DIRECTORS
Mr Tridibesh Mukherjee, Mr Sanjoy Bhattacharya, Ms Pallavi P Kaul and
Mr Narottam Das retire by rotation at the forthcoming Annual General
Meeting and being eligible, offer themselves for re-appointment.
Mr Niraj Kela, Director (F&A) of Technology Development Board (TDB) was
appointed as an Additional Director of your Company with effect from
9th July, 2012, as the Nominee Director of TDB in place of Mr Rajiv
Srivastava. Your Directors place on record their appreciation for the
valuable services rendered to the Company by Mr Rajiv Srivastava during
his tenure as Nominee Director of the Company.
Mr Niraj Kela holds Office as Director of your Company upto the date of
the ensuing Annual General Meeting. Your Company has received a Notice
in writing along with the requisite deposit from a Member, in terms of
Section 257 of the Companies Act, 1956, signifying his intention to
propose the appointment of Mr Niraj Kela, as a Director of your Company
at the forthcoming Annual General Meeting.
On the recommendation of the Compensation & Remuneration Committee, the
Board of Directors of your Company at its Meeting held on 31st July,
2012, re-appointed Mr Udayan Ray as Managing Director & CFO of your
Company for the period from 1st October, 2012 to 31st March, 2014 on
the terms and conditions, subject to your approval in the General
Meeting and such other approvals/clearances as may be required.
An abstract of the terms of appointment and remuneration payable to Mr
Udayan Ray as Managing Director & CFO of your Company and the
Memorandum as the nature of concern and interest of Directors with said
appointment as required under section 302 of the Companies Act, 1956
are given in the Explanatory Statement of the Notice convening the 29th
Annual General Meeting.
No other Director is in any way concerned or interested in the said
appointment and payment of remuneration to Mr Udayan Ray.
A brief resume of the Directors proposed to be appointed/re-appointed,
nature of their expertise in specific functional areas and names of
Companies in which they hold Directorships and
memberships/Chairmanships of Board/Committees, as stipulated under
clause 49(IV)(G) of the Listing Agreement with the Stock Exchange, are
provided in the Notice convening the 29th Annual General Meeting of
your Company.
Your Directors express their profound grief on the sad demise of Mr D N
Bhattachrjee on 7th March, 2012.
The Board place on record its deep sense of appreciation for the
valuable contributions made by Mr D N Bhattacharjee during his tenure
as Director of your Company.
N. EXPORTS
During the year under review exports have not been significant.
O. DIRECTORS' RESPONSIBILITY PURSUANT TO SECTION 217(2AA) OF THE
COMPANIES ACT, 1956
Your Directors confirm :
1. that in the preparation of the Annual Accounts, the applicable
Accounting Standards have been followed;
2. that your Directors have selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of your Company at the end of the year ended 31st March,
2012 and of the profit of your Company for that period;
3. that your Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
your Company and for preventing and detecting fraud and other
irregularities; and
4. that your Directors have prepared the Annual Accounts on a going
concern basis.
P. PARTICULARS OF EMPLOYEES
Your Company did not employ any person whose particulars are required
to be attached to this Report under Section 217(2A) of the Companies
Act, 1956.
Q. KEY MANAGEMENT TEAM
Your Company has the following members as part of their key management
team: Mr Udayan Ray, Managing Director & CFO, Mr S K Pal, Executive
Director, Mr V R Moza, President (Marketing), Mr A K Ghosh, President
(Operations), Mr Kartick Kr. Chatterjee, Sr. Vice President (Corporate
Affairs & Legal) and Mr Indranil Mitra, General Manager & Company
Secretary.
R. AUDITORS
The Statutory Auditors of your Company, M/s G Basu & Co., Chartered
Accountants, retire at the forthcoming Annual General Meeting and,
being eligible, offer themselves for re-appointment. Your Directors
recommend the re-appointment of M/s G Basu & Co., as Statutory Auditors
of your Company and their remuneration needs to be fixed.
S. AUDITORS'REPORT
The Comments made by the Auditors in their report have been duly
explained in the attached Notes to Accounts and hence do not need to be
dealt with here.
T. COST AUDITORS
Pursuant to the directives of the Central Government under the
provisions of section 233B of the Companies Act, 1956, M/s S Roy
Choudhury & Co., Cost Accountants, have been appointed to conduct Cost
Audits relating to cables manufactured by your Company.
U. ACKNOWLEDGEMENTS
Your Directors wish to record their sincere appreciation of the efforts
put in by all the employees and their commitment during the year. Your
Directors also take this opportunity to acknowledge the cooperation and
assistance of Banks, Financial Institutions, Technology Development
Board, the Government of India, the Government of West Bengal and the
CDR Cell. Finally, your Directors owe their gratitude to all the
Shareholders and Debenture Holders for their continued support.
On behalf of the Board of Directors
Place : Kolkata RAJIVE KAUL UDAYAN RAY
Dated, the 31st day of July, 2012 Chairman Managing Director
Mar 31, 2010
The Directors present herewith their Report together with the Audited
Accounts of your Company for the year ended 31st March] 2010.
(Rs. In Lakhs)
A. FINANCIAL RESULTS & APPROPRIATIONS 2009-10
Gross Turnover : 32013
Gross Profit/(Loss) for the year : (2346)
Less: Interest : 2362
Less: Depreciation : 773
Profit / (Loss) before Tax : (5481)
Less : Deferred Tax Asset/FBT : 1165
Net Profit/(Loss) after Tax : (4316)
The economic downturn coupled with shortage of working capital
seriously affected the performance of your Company. In addition, your
Company faced industrial relation problems connected to payment of
bonus in both factories leading to temporary suspension of work. The
margin for all activities declined sharply due to intense competition.
The overall profitability position could not be protected by increasing
volume due to a shortage of working capital and the industrial relation
situation. Further the loss making projects of IOCL and NALCO were
commissioned. The settlements with the unions and workmen were reached
in both factories. The package from Corporate Debt Restructuring (CDR)
was approved and implemented with effect from 30th June 2009. Some
improvement in performance was achieved in January - March 2010 quarter
but the same was not adequate to return to profitability.
The order book position at the beginning of the financial year 2010-11
was healthy. Many of the problems faced during the year were addressed
except the working capital situation, which remained critical and
adversely impacted operations.
B. DIVIDEND
In view of the loss suffered by the Company and the accumulated losses
of the previous years, your Directors do not recommend any dividend on
Preference or Equity Shares.
C. Management Discussion and Analysis Report
Management Discussions and Analysis Report as required under the
Listing Agreement with the Stock Exchange is enclosed in Annexure A.
D. FINANCE
The restrictive clauses in the Master Agreement with Prysmian (agreed
in good faith that the deal would go through) and their abrupt and
sudden withdrawal had an adverse influence on the performance of your
Company. To seek redressal your Company had moved a petition to
Calcutta High Court and the Supreme Court. The Supreme Court in a
recent judgment has referred the matter to Arbitration and has also
appointed the Arbitrator.
With a view to address the issues, in particular the working capital
shortage, the Company had approached CDR for restructuring of the
finances. The approval of CDR was received on 23rd March 2009.
Your Company complied with all the stipulations in regard to creation
of securities, infusion of fresh funds etc and the package was
implemented with effect from 30th June 2009. Simultaneously TDB, WBIDC
and Government of West Bengal were also approached to restructure the
Loans and Preference Shares.
The package provided initial support but under present circumstances is
inadequate for long term growth and profitability. Your Company is thus
exploring other options for raising funds.
On restoration of facilities as per CDR approved package, your Company
could obtain some working capital for operations. In addition, your
Company resorted to stringent cost reduction program. As mentioned
earlier the industrial relation problems arising out of payment of
bonus adversely affected the production and profitability. The
settlement with unions/workmen was reached and both factories are now
operational.
E. FIXED DEPOSITS
The total amount of deposits as on 31st March 2010 was Rs. 0.40 lakhs.
Depositors did not claim deposits aggregating to Rs. 0.40 lakhs due for
repayment before 31st March 2010. None of the deposits have since been
refunded or renewed.
F. NOTES ON SUBSIDIARIES
The notes on subsidiaries may be read along with the Consolidated
Financial Statements enclosed with the Accounts, prepared in accordance
with Accounting Standard 21. Your Company has been exempt from the
provisions of Section 212(1) of the Companies Act, 1956 relating to the
attachment of the accounts of its subsidiaries to its Accounts.
Shareholders so desiring the annual accounts of your Companys
subsidiaries may obtain the same upon request. The report and accounts
of the subsidiary companies will be kept for inspection at your
Companys registered office and those of the subsidiary companies.
Further, the report and accounts of the subsidiary companies will also
be available at your Companys website, www.niccogroup.com.
Nicco Engineering Services Ltd, had a gross turnover of Rs. 2,112 lac
during the year ended 31st March 2010 which was similar to the previous
year. This was despite the slowdown in Q2 and Q3. However profitability
declined on account of non-recurring charges relating to office
relocation expenses necessitated by the fire at the Companys office
and the profit before tax stood at Rs. 286.41 lacs.
Nicco Biotech Limited has achieved a turnover of Rs. 34.50 lacs in
2009-10 as against Rs. 38.04 lacs in 2008-09. The net loss after tax
has been brought down from Rs. 40.94 lacs to Rs. 19.54 lacs.
NE Cables has made a loss of Rs. 0.14 lacs in 2009-10 as against Rs.
0.47 lacs in 2008-09. The Company has not commenced operation and hence
no transactions have taken place during the year under review.
Nicco Cables Limited has made a net loss of Rs. 0.01 lacs in 2009-10
against Rs. 0.08 lacs in 2008-09. The Company has not commenced
operation and hence no transaction has taken place during the year
under review.
G. ENERGY CONSERVATION
The details relating to energy conservation requirements of section
217(l)(e) of the Companies Act, 1956 are not applicable.
H. RESEARCH AND DEVELOPMENT
Details in regard to Research and Development are shown in Annexure B.
I. FOREIGN EXCHANGE EARNINGS AND OUTGO
Details of foreign exchange earnings and outgo are shown in Annexure B.
J. CORPORATE GOVERNANCE
Your Company has always followed the principles of good Corporate
Governance through accountability and transparency. A separate report
on Corporate Governance as prescribed in the Listing Agreement of the
relevant Stock Exchange forms part of the Annual Report 2009-10 along
with the Auditors statement on its compliance (Annexure C).
K. TOTAL QUALITY AND ENVIRONMENT MANAGEMENT
Both the factories at Shyamnagar and Baripada are accredited to Quality
Management System (QMS) under ISO 9001:2000 and Environment Management
System (EMS) under ISO 14001:2004, Shyamnagar unit has updated their
ISO 9001:2000 certificate to ISO 9001:2008 which is the latest version
of Quality Management System specification. Baripada will update their
certificate to 2008 version by November 2010. Both these systems
continue to be maintained through periodic Internal Audits by a team of
trained Internal Auditors and by Re-Certificatiori/Surveillance Audits
conducted by the Indian Register of Quality System (IRQS).
L. FUTURE PROSPECTS
With the continued thrust in improving internal efficiencies and other
operational measures your- Directors are planning for a better
performance in the current year.
M. DIRECTORS
Mr Sanjoy Bhattacharya ceased to be a Director of the Company with
effect from 30th September 2009 pursuant to his retirement as Director
(Cable Operations).
Your Directors place on record their appreciation of the valuable
services rendered by Mr Sanjoy Bhattacharya during his tenure as
Director (Cable Operations) of the Company.
Mr Sanjoy Bhattacharya, was appointed as an Additional Director on 1st
October, 2009. Mr Sanjoy Bhattacharya holds office as Director of the
Company up to the date of the ensuing Annual General Meeting. The
Company has received a notice in writing along with the requisite
deposit from a Member, in terms of Section 257 of the Companies Act,
1956, signifying his intention to propose the appointment of Mr Sanjoy
Bhattacharya, as a Director of the Company at the forthcoming Annual
General Meeting.
The particulars of Mr Sanjoy Bhattacharya required to be disclosed,
pursuant to clause 49(IV)(G) of the Listing Agreement, are also given
in the Notice convening the 27th Annual General Meeting of the Company.
Mr Narottam Das, Mr Udayan Ray and Ms Pallavi P Kaul retire by rotation
at the forthcoming Annual General Meeting and being eligible, offer
themselves for re-appointment.
A brief resume of the Directors proposed to be appointed/re-appointed,
nature of their expertise in specific functional areas and names of
Companies in which they hold Directorship and Memberships/Chairmanships
of Board/Committees, as stipulated under clause 49 (IV)(G) of the
Listing Agreement with the Stock Exchange, are provided in the Notice
convening the 27th Annual General Meeting of the Company.
Your Directors express their profound grief on the sad demise of Dr L R
Vaidyanath on 26th July, 2010.
The Board placed on record its deep sense of appreciation for the
invaluable contributions made by Dr L R Vaidyanath during his tenure as
a Director of the Company.
N. EXPORTS
During the year under review exports have not been significant.
O. DIRECTORS RESPONSIBILITY PURSUANT TO SECTION 217 ( 2AA) OF THE
COMPANIES ACT, 1956
Your Directors confirm :
1. that in the preparation of the Annual Accounts, the applicable
Accounting Standards have been followed ;
2. that your Directors have selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the year ended 31st March, 2010
and of the loss of the Company for that period ;
3. that your Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities ;
4. that your Directors have prepared the Annual Accounts on a going
concern basis.
P. PARTICULARS OF EMPLOYEES
Particulars of Employees under section 217(2A) of the Companies Act,
1956 and forming part of Directors Report for the year ended 31st
March 2010.
Name Age Designation/ Gross Qualifications
Nature of Remuneration
Duties (Rs.)
Rajive Kaul 61 yrs. Chairman 31,61,493 B.Sc. (Hons)
Metallurgical
Engineer (London)
ARSM (London) MUM
(India) FIM
(London)
Chartered Engineer
(London)
Name Experi- Date of Previous
ence Joining Employment
(Yrs.) held
Rajive Kaul 38 13.07.1976 ITC Ltd.
Executive
Marketing Dept.
Q. AUDITORS
The Statutory Auditors of your company M/s G Basu & Co., Chartered
Accountants, retire at the forthcoming Annual General Meeting and,
being eligible, offer themselves for re-appointment. Your Directors
recommend the re-appointment of M/s G Basu & Co., as Statutory Auditors
of the Company and their remuneration needs to be fixed.
R. AUDITORS REPORT
The Comments made by the Auditors in their report have been duly
explained in the attached Notes to Accounts and hence do not need to be
dealt with here.
S. COST AUDITORS
Pursuant to the directives of the Central Government under the
provisions of section 233B of the Companies Act, 1956 M/s S Roy
Choudhury & Co., Cost Accountants, have been appointed to conduct Cost
Audits relating to cables manufactured by your Company.
T. ACKNOWLEDGEMENTS
Your Directors wish to record their sincere appreciation of the efforts
put in by many employees and their commitment during the year. Your
Directors also take this opportunity to acknowledge the cooperation and
assistance of Banks, Financial Institutions, Technology Development
Board, the Government of India, the Government of West Bengal and the
CDR Cell. Finally, your Directors owe their gratitude to all the
Shareholders and Debenture Holders for their continued support to your
Company.
On behalf of the Board of Directors
Place : Kolkata RAJIVE KAUL
Dated, 21st day of May, 2010 Chairman