Home  »  Company  »  Precision Wires  »  Quotes  »  Directors Report
Enter the first few characters of Company and click 'Go'

Directors Report of Precision Wires India Ltd.

Mar 31, 2015

DEAR MEMBERS,

The Directors hereby present the Twenty Sixth Annual Report of your Company, together with the Audited Accounts for the year ended 31st March, 2015.

1. Financial Results

(Rupees in Lacs)

2014-15 2013-14

Sales (including Excise Duty) 101738.04 111754.77

Less: Excise Duty (13660.59) (13585.92)

Sales (Net of Excise Duty) 88077.45 98168.85

Operating Profit 4734.31 5572.25

Add: Other lncome 324.67 285.99

Profit before Financial Charges,

Depreciation & Taxes 5058.98 5858.24

Financial Charges (1421.89) (2371.16)

Depreciation (1959.03) (1181.02)

Profit before Taxes & Extra-ordinary Items 1678.06 2306.26

Extra-ordinary Items - -

Profit before Taxes 1678.06 2306.26

Less: Provision for Tax (667.67) (862.07)

Profit after Tax 1010.39 1444.19

Add: Balance brought forward from last Account 216.38 270.08

Balance available: (A) 1226.77 1714.27

Which the Board of Directors have appropriated as under:

(I) Transfer to General Reserve 250.00 145.00

(ii) Proposed Total Dividend 636.00 1156.36 @ Rs.5.50 for the year (Previous year @Rs. 10.00), which includes Interim Dividends @Rs.3.00 (Previous year @Rs.8.00) perequity share.

(iii) Corporate Tax on Dividend 127.13 196.53

(B) 1013.13 1497.89

Balance carried forwarded in Profit & Loss A/c (A-B) 213.64 216.38

2. Dividend

Board of Directors were pleased to recommend 1st interim dividend of Rs. 2/- at the meeting held on 13.11.2014 and 2nd interim dividend of Re. 1/- per equity share of face value Rs. 10/- each, at the meeting held on 10.02.2015. The Directors are pleased to recommend further final dividend at Rs. 2.50 (25%), total Dividend recommended is Rs. 5.50 (55%) per Equity share of face value Rs. 10/- each subject to the approval of the Members at the ensuing General Meeting for the year 2014-15.

3. Operations

Our Production during the year was almost at previous year's level. Despite the competition and sluggish market conditions, we have been able to maintain the production level.

The overall economic and industrial climate continued to remain sluggish. Electrical Equipments manufacturing sector and Capital Goods Sector continued to feel the effects of low demand. Increase in imports of electrical equipments from China affects the domestic industry. Cost pressures due to high rate of inflation continued to affect the industry.

The Government is trying to take effective steps to improve the overall fiscal, economic and industrial climate in the country. There is an improvement in the economic and industrial sentiment. It may however take more time for the reforms to reach the grass root level and activate industrial demand. Inherent distortions arising from rapidly increasing trade deficit were arrested due to price fall of imported hydro- carbons.

The Companies Act, 2013 has become effective from 1st April, 2014. Therefore pursuant to relevant provisions of this said Act the useful life of the fixed assets has been revised according to Sch II thereof effective from April 1, 2014. Hence, the Depreciation and Amortization Expenses for the Year ended 31st March, 2015 is higher by Rs. 739 lacs due to change in the useful life of the fixed assets. Further based on transitional provisions vide note 7(b) of the Sch II of the said Act, an amount ofRs. 1863.50 on account of assets whose useful life has already been exhausted, on April 1,2014, (net of deferred tax) thereon have been adjusted to the opening balance of General Reserves. Provision of higher Depreciation as per the new provisions of the Companies Act, 2013, has impacted the Profits of the Company for the Year. However, PBDT, Post Tax Cash Flow (PAT Depreciation), Current and Debt Equity Ratios have improved.

International Rates of our primary Input, Copper, has gone down from third quarter of F.Y. 2014-15 onwards. In the second half of the fiscal, against USD, Rupee has depreciated.

We continue to be optimistic for future growth of Electrical- Equipment-Manufacturing, Power and Infrastructure sectors who are principal consumers of products manufactured by us.

Imports through FTA and PTA need to be looked into for protecting the manufacturing sectors in our Country.

While the proposed GST is a good measure and we welcome the same. However, the 1% non-vatable inter- state tax proposed under clause 18 of the Draft Bill, will adversely affect all Industries, who have Pan-India marketing operations. We hope that the Government will find some effective solutions for this.

Considering the prevailing adverse economical climate in the country during the year under Report, your Company has performed well.

The PBDIT is 5058.98 (5858.24) Finance Charges 1421.89 (2371.16). Depreciation 1959.03 (1181.01), PBT 1678.06 (2306.26) Provision for Tax 667.67 (862.07). PAT 1010.39 (1444.19) lacs is lower than previous year mainly due to additional Depreciation of Rs. 739.10 Lacs as per the requirement of Companies Act, 2013. Our Reserves and Surplus (excluding Revaluation) are about Rs. 17528 (19154) at the end of March 2015.

Since our Winding Wires are used in the manufacture of Electrical Equipment, Long term prospect for the Industry is bright. Manufacturing -Sector also is likely to be given priority as the same generates more employment. Growth in Infrastructure-Sector such as Air Ports, Metros, Highways, surface Transport etc. besides the Power-Sector, is likely to have catalytic impact on Capital-Goods-Sector. India, being a power-deficit country, the long term prospects of the Electrical Equipment Manufacturing Industry is good.

Prevailing adverse economic climate in the country is bound to change for the better and your Company is hopeful for upturn in the Economy. Your Company has been performing consistently well, is continuously dividend-paying and is the market-leader.

We have discharged all financial obligations in time, without delay or default.

4. Extract of Annual Return:

The details forming part of the extract of the Annual Return in Form MGT-9, as required under Section 92 of the Companies Act, 2013, is to be included in this Report as Annexure-A and forms an integral part of this Report.

5. Number of Board Meetings held:

The Board of Directors duly met 5 (Five) times during the financial year from 1st April, 2014 to 31st March, 2015. The dates on which the meetings were held are as follows:

28-05-2014, 07-08-2014, 13-11-2014, 06-01-2015 and 10-02-2015.

6. Directors'Responsibility Statement:

Pursuant to Section 134(5) of the Companies Act, 2013, Directors of your Company hereby state and confirm that:

a) in the preparation of the annual accounts for the year ended 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b) they 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 profit of the company for the same period;

c) the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

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

e) they have laid down internal financial controls in the company that are adequate and were operating effectively.

f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and these are adequate and are operating effectively.

7. Nomination and Remuneration Policy:

The Board of Directors follows the policy as per the Act regarding appointment and remuneration etc. of the Executive Directors of the Company. No remuneration was paid to Independent Directors during the Year except sitting fee for attending the Meetings of the Board/Committees. The Managing Directors appoint and fix from time to time the remuneration and perks of the Key Managerial Personnel of the Company. The Company has three Executive Directors on the Board and Six Non-Executive - Independent Directors, including a Woman Director.

8. Key Managerial Personnel:

Sr.No. Name of the Person Designation

01 Shri Mahendra R Mehta Chairman and Managing Director

02 Shri Milan M Mehta Vice-Chairman and Managing Director

03 Shri Deepak M Mehta Whole-time Director

04 Shri C.Mohandas Pai CFO&GM Finance and Accounts

05 Mrs.NishthiH Dharmani CompanySecretary

9. No Qualification, Reservation or Adverse Remark or Disclaimer Made:

(i) by the auditor in his report; and

(ii) by the company secretary in practice in his secretarial audit report;

10. Particulars of Loans, Guarantees or Investments:

The Company has not given any Loans, except to the employees and has not provided, to any individual / body corporate, any Guarantees/Loan.

11. Related Party Transactions:

All transactions entered with Related Parties, during the financial year were in the ordinary course of business and on an arms length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. Thus disclosure in form AOC-2 is not required. There were no materially significant related parties transactions during the financial year with Promoters, Directors and Key Managerial Personnel which were in conflict with the interest of the Company. Suitable disclosure as required by the Accounting Standards (AS18) has been made in the notes to the Financial Statements.

The Board has approved a policy for interested related party transactions which has been uploaded on the Company's website.

None of the Directors has any pecuniary relationship or transaction vis-a-vis the Company.

The Company has frame work for the purpose of identification and monitoring of related party transactions. All related Party transactions are placed before the Audit Committee as also to the Board of Director's for approval. Omnibus approval was obtained on a quarterly basis for transactions which are of repetitive nature. Transactions entered into pursuant to omnibus approval are placed before the Audit Committee and Board for review and approval on quarterly basis.

12. There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report;

13. Conservation of energy, technology absorption, foreign exchange earnings and outgo:

Information required under section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is given in the Annexure-B to this report.

14. Development and Implementation of a Risk Management Policy:

The Company has been addressing various risks impacting the Company.

Some of the risks that the Company is exposed to are:

Financial Risks

The Company's policy is to actively manage its foreign exchange risk.

Commodity Price Risks

The Company is exposed to the risk of price fluctuation of raw materials and foreign exchange. Generally, so far it is practicable the Company purchases Copper back-to-back after the receipt of the order / Consumer - opted - Copper bookings so as to minimize the above risk. This also helps to a large extent inventory management.

Regulatory Risks

We endeavour to furnish and submit / file our data with all concerned Authorities, so as to comply, in time, with the various Rules and Regulations. Wherever, certain Regulations, we are unable to understand / grasp, we take assistance of Qualified and experienced consultants.

The Company is also mitigating these risks with the help of regular external compliance audits.

15. Corporate Social Responsibility (CSR):

In terms of Section 135 and Schedule VII of the Companies Act, 2013, the Board of Directors of the Company has constituted a CSR Committee. The Committee comprises of One Independent Director and Two Executive Directors. Additionally, the CSR Committee has developed a CSR Policy. The CSR Policy has been uploaded on the website of the Company.

As required, in the Accounts and Annual Audited Report for FY 2014-15, we have made provision for the CSR-Amount of Rs. 44.50 lacs (rounded off). A statement as required under the Companies Act, 2013 is enclosed as part of this report as Annexure C. Donations already made under Section 80 G of the Income Tax Act, have not been reduced from the CSR amount for the year provided for in Audited Accounts..

16. Corporate Governance:

Please refer to the Annexure D to the Directors Report in the Audited Annual Report for the Accounting Year 2014-15.

The Company has framed a Code of Conduct for all its Board Members and Senior Management Personnel of the Company, who have affirmed compliance thereto. The said Code of Conduct has been posted on the Company's website. The Declaration to this effect signed by the CEO is made a part of the Annual Report.

17. Performance Evaluation:

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, a separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board who were evaluated on parameters such as level of engagement and contribution and independence of judgment thereby safeguarding the interest of the Company. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors. The board also carried out annual performance evaluation of the working of its Audit, Nomination and Remuneration as well as stakeholder relationship committee. The Directors expressed their satisfaction with the evaluation process.

18. Deposits:

The Company has not accepted any deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

19. There are no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and Company's operations in future.

20. PARTICULARS OF EMPLOYEES under Section 197(12) and Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

The information required pursuant to Section 197 read with rule, 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request.

None of the employee hold (by himself or along with his spouse and dependent children) more than two percent of the equity shares of the Company.

21. Listing / Dematerialisation of the Company's Equity Shares:

The Equity Shares of your Company continue to be listed at the Bombay Stock Exchange Ltd, (BSE) and National Stock Exchange of India Ltd (NSE) and the required Annual Listing Fees have been paid.

The Equity Shares of the Company are compulsorily traded in dematerialized form as prescribed by SEBI. The same are registered with both National Securities Depository Ltd., Trade World, 4th Floor, Kamala Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai - 400 013, and Central Depository Services (India) Limited, Phiroze Jeejeebhoy Towers, 28th Floor, Dalai Street, Mumbai - 400 023, Under ISIN No. INE372C01011 common for both.

22. Auditors

a) Statutory Auditors:

The Auditors, M/s. S. R. Divatia & Company, Chartered Accountants, Mumbai, who have been Statutory Auditors of the Company, hold office until the ensuing Annual General Meeting. Subject to the approval of the Members, it is proposed to re-appoint them for the Financial Year 2015-16. As required under the provisions of Section 139 of the Companies Act, 2013, the Company has obtained written confirmation from M/s. S. R. Divatia & Company that their appointment, if made, would be in conformity with the limits specified in the said section.

b) Cost Auditors:

Based on the recommendation of the Audit Committee at its meeting held on 29th May, 2015, the Board has appointed M/s. Gangan & Co., Cost Accountants as the Cost Auditors to audit the Cost accounts of the Company for the Financial Year 2015-16 at a remuneration of Rs. 3,00,000/- plus service tax as applicable and reimbursement of out of pocket expenses. As required under the Companies Act, 2013, a resolution seeking member's approval for the remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting.

The Cost Accounting records maintained by the Company for Products covered under Central Excise Tariff Act, 1985 Chapter Heading 8544 (Winding Wires Made of Copper) are subject to yearly audit by qualified Cost Auditors.

The cost audit report for the financial year 2013-14 was filed with the Ministry of Company Affairs on 08th November, 2014.

c) Secretarial Audit:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Messrs Ragini Chokshi & Company, a firm of Company Secretaries in Practice (C.P. Number 1436) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is included as "Annexure E" and forms integral part of this report.

There is no secretarial audit qualification for the year under review.

23. Directors:

a) The term of appointment of Shri Milan M. Mehta, as Vice Chairman & Managing Director, expires on 31st March, 2015. On the recommendation of Nomination and Remuneration Committee, the Board of Directors, at their meeting held on 10th May, 2015, re-appointed Shri Milan M. Mehta as Vice Chairman & Managing Director for a period of three years w.e.f. 1st April, 2015 subject to the approval of the members at ensuing AGM and other statutory approval required, if any.

b) Pursuant to Section, 152 of the Companies Act, 2013, and the Articles of Association of the Company, Shri Milan M. Mehta, Director will retire by rotation at the end of ensuing Annual General Meeting, and being eligible, offer himself for re-appointment in accordance with the provisions of the Companies Act, 2013.

c) Pursuant to the provisions of the section 161(1) of the Companies Act, 2013 read with the Articles of Association of the Company, Mrs. Swati Gokul Maheshwari, holding DIN 07091067 was appointed as Additional Director w.e.f. 10th February, 2015, in the category of Independent Directors and she shall hold office up to the date of the ensuing Annual General Meeting and being eligible offers herself for re-appointment as Director in accordance with the provisions of the Companies Act, 2013, for a period of 5 years w.e.f. ensuing Annual General Meeting.

The brief resume of the Directors being appointed/ re-appointed, the nature of their expertise in specific functional areas, names of companies in which they have held directorships, committee memberships/ chairmanships, their shareholding etc., are furnished in the explanatory statement to the notice of the ensuing Annual General Meeting.

Your Directors therefore, recommend their appointment / re-appointment at the ensuing Annual General Meeting.

d) At the 25th Annual General Meeting of the company held on 29th September, 2014 the Company had appointed all the existing independent directors as independent directors under the Companies Act, 2013 for 5 consecutive years for a term upto the conclusion of Annual General Meeting of the Company to be held in the calendar year 2019.

e) All independent directors have given declaration that they meet the criteria of independence as laid down under section 149(6) of the Companies Act, 2013 and clause49of listing agreement.

f) the details key managerial personnel who were appointed or have resigned during the year; None.

24. Internal Control Systems and their Adequacy:

Your Company has an effective internal control and risk- mitigation system, which are constantly assessed and strengthened with new/revised standard operating procedures. The Company's internal control system is commensurate with its size, scale and complexities of its operations. The internal and operational audit is entrusted to Messrs Devdhar & Associates, reputed firm of Chartered Accountants . The main thrust of internal audit is to test and review controls, appraisal of risks and business processes, besides benchmarking controls with best practices in the industry.

The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of the internal control systems and suggests improvements to strengthen the same. The Company has a robust Management Information System, which is an integral part of the control mechanism.

The Audit Committee of the Board of Directors, Statutory Auditors and the Business Heads are periodically apprised of the internal audit findings and corrective actions taken. Audit plays a key role in providing assurance to the Board of Directors. Significant audit observations and corrective actions taken by the management are presented to the Audit Committee of the Board. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee.

25. Vigil Mechanism/Whistle Blower Policy:

The Company has a vigil mechanism to deal with instance of fraud and mismanagement, if any. The Policy is posted on the website of the Company.

26. Acknowledgements

The Directors wish to place on record their deep appreciation of the continued assistance and co-operation from Bank of Baroda, the Administration of Union Territory of Dadra and Nagar Haveli, Palej Gram Panchayat, Shareholders and all the Staff and employees of the Company

For and on behalf of the Board,

Mahendra R. Mehta, Chairman and Managing Director

Mumbai Dated 29th May, 2015


Mar 31, 2014

Dear Members,

The Directors hereby present the Twenty Fifth Annual Report of your Company, together with the Audited Accounts for the year ended 31st March, 2014.

1. Financial Results

(Rupees in Lacs) 2013-14 2012-13

Sales (including Excise Duty) 111754.77 112779.44

Less: Excise Duty (13585.92) (15196.58)

Sales (Net of Excise Duty) 98168.85 97582.86

Operating Profit 3488.06 4025.80

Add: Other Income 285.99 126.30

Profit before Financial Charges, Depreciation & Taxes 3774.05 4152.10

Financial Charges (286.78) (506.85)

Depreciation (1181.01) (1257.41) Profit before Taxes &

Extra-ordinary Items 2306.26 2387.84

Extra-ordinary Items - -

Profit before Taxes 2306.26 2387.84

Less: Provision for Tax (862.07) (792.41)

Profit after Tax 1444.19 1595.43 Add: Balance brought forward from last Account 270.08 363.54

Balance available: (A) 1714.27 1958.97 Which the Board of Directors have appropriated as under:

(I) Transfer to General Reserve 145.00 1150.00

(ii) Proposed Total Dividend 1156.36 462.54 @Rs.10.00 for the year

(Previous year @ Rs.4.00), which includes two Interim Dividends @ Rs. 4.00 Rs.4.00 = Rs. 8.00 (Previous year @ Rs. 2.50) per equity share already since paid.

(iii) Corporate Tax on Dividend 196.53 76.38

(B) 1497.89 1688.91

Balance carried forwarded in

Profit & Loss A/c (A-B) 216.38 270.08

2. Dividend

Board of Directors were pleased to recommend at the meeting held on 28.10.13 and 12.02.14 Interim Dividend of Rs.4/- each per Equity share of Rs.10/-, since already paid. Being the Jubilee Year, the Directors are pleased to recommend further final additional Dividend @ Rs.2/- (20%), total Dividend recommended is Rs.10/- (100%) per Equity share of Rs.10/- each subject to the approval of the Members at the ensuing General Meeting for the year 2013-14.

3. Operations

Our Production during the year was slightly lower than the previous year. The overall economic industrial climate was unfortunately sluggish. Electrical Equipment Manufacturing Industry and Capital Goods Sector registered negative growth. Increasing import of electrical equipments from China, affected Domestic Industry.

Inflation, High cost of finance, lower capacity utilisation, inadequate availability of proper Grade fuel and issues pertaining to environmental clearances affected overall fiscal, economical and Industrial climate in the country.

Considering the prevailing adverse economical climate in the country during the year under Report, your Company has performed well.

The PBDIT is 3774.05 (4152.10) Finance charges 286.78 (506.85). Depreciation 1181.01 (1257.41) PBT 2306.26 (2387.84) Provision for Tax 862.07 (792.41) and PAT 1444.19 (1595.43) lacs which is slightly lower than previous year due to high volatility in USD/INR during Qll of the Year, more imports of input, higher Employees Benefits Expenses, Insurance & freight and other expenses. Our Reserves and Surplus (excluding Revaluation) are about Rs.19154 (19063) at the end of March 2014.

Since our Winding Wires are used in the manufacture of Electrical Equipment, Long term prospect for the Industry is bright. Manufacturing -Sector also is likely to be given priority as the same generates more employment. Growth in ]Infrastructure-Sector such as Air Ports, Metros, Highways, surface Transport etc. besides the Power-Sector, is likely to have catalytic impact on Capital-Goods-Sector.

Notwithstanding whatever has been stated in the foregoing paragraphs, your Company continues to be optimistic about future growth in the sector. India, being a power-deficit country, long term prospects of the Electrical Equipment Manufacturing Industry is bright. Since around 40 crore people in our Country do not have access to electricity, Power-Sector enjoys utmost priority. Between now and 2050 Indian electricity supply and demand are projected to increase five-fold.

Inherent distortions arising from rapidly increasing trade deficit has attracted attention of the Government and remedial measures have been taken.

Prevailing adverse economic climate in the country is bound to change for the better and your Company is hopeful for upturn in the Economy. Your Company has been performing consistently well and continues to be the Market-leader with low-debt-gearing, Debt-Equity Ratio less than 0.25, and Current Ratio at about 1.44.

We have discharged all financial obligations in time, without delay or default.

4. Listing / Dematerialisation of the Company''s Equity Shares

The Equity Shares of your Company continue to be listed at the Bombay Stock Exchange Ltd, (BSE) and National Stock Exchange of India Ltd (NSE) and the required Annual Listing Fees have been paid.

The Equity Shares of the Company are compulsorily traded in dematerialized form as prescribed by SEBI. The same are registered with both National Securities Depository Ltd., Trade World, 4th Floor, Kamala Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai - 400 013, and Central Depository Services (India) Limited, Phiroze Jeejeebhoy Towers, 28th Floor, Dalai Street, Mumbai - 400 023, under ISIN No. INE372C01011 common for both.

5. Particulars of Employees:

As required under the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules 1975, particulars of the employees are given in Annexure I hereto and form part of this report.

6. Disclosure of particulars in the Directors'' Report:

As required under the provisions of Section 217 (1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of particulars in the report of the Board of Directors) Rules 1988, the necessary particulars are given in Annexure II hereto and form part of this report.

7. Auditors

a) Statutory Auditors:

The Auditors, M/s. S. R. Divatia & Company, Chartered Accountants, Mumbai, who have been Statutory Auditors of the Company, hold office until the ensuing Annual General Meeting. Subject to the approval of the Members, it is proposed to re-appoint them for the Financial Year 2014-15. The Auditors have furnished, u/s 224 (1B) of the Companies Act 1956, Certificate of Eligibility for reappointment.

b) Cost Auditors:

The Cost Accounting records maintained by the Company for Products covered under Central Excise Tariff Act, 1985 Chapter Heading 8544 (Winding Wires Made of Copper) are subject to yearly audit by qualified Cost Auditors.

Based on the Audit Committee recommendation at its meeting held on 29th May, 2013, the Board has appointed M/s. Gangan &Co., Cost Accountants as the Cost Auditor of the Company for the Financial Year 2013-14.

8. Corporate Governance:

As required by Clause 49 of the Listing Agreements with Stock Exchanges, a Corporate Governance Report, a Management Discussion and Analysis, and the Certificate of the Auditors of the Company regarding compliance of conditions of Corporate Governance are made a part of the Annual Report. Please refer Annexure III to the Directors'' Report.

The Company has framed a Code of Conduct for all its Board Members and Senior Management Personnel of the Company, who have affirmed compliance thereto. The said Code of Conduct has been posted on the Company''s website. The Declaration to this effect signed by the CEO is made a part of the Annual Report.

9. Directors'' Responsibility Statement:

Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of Directors of the Company based on the representations received from the operating management confirms:

I. that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. that the directors had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at the end of financial year ended 31st March, 2014 and of the profit of the Company for that period;

iii. that the directors had 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;

iv. that the directors had prepared the annual accounts for the year ended 31st March, 2014, on a going concern basis.

10. Directors:

a) The term of appointment of Shri Mahendra R. Mehta, as Chairman & Managing Director, expires on 30th September, 2014. On the recommendation of Nomination and Remuneration Committee (N&RC), the Board of Directors, at their meeting held on 28th May, 2014, re-appointed Shri Mahendra R. Mehta as Chairman & Managing Director for a period of three years w.e.f. 1st October, 2014 subject to the approval of the members at ensuing AGM and other statutory approval required, ifany.

b) Pursuant to Sections 149, 152 and other applicable provisions, if any, of the Companies Act, 2013, one- third of such of the Directors as are liable to retire by rotation, shall retire every year and, if eligible, offer themselves for re-appointment at every Annual General Meeting. Consequently, Shri Mahendra R Mehta, Director will retire by rotation at the end of ensuing Annual General Meeting, and being eligible, offer himself for re-appointment in accordance with the provisions of the Companies Act, 2013.

Further as per Section 149(5) of the Companies Act, 2013, the Company is required to appoint Independent Directors under Section 149(4) within a period of one year from 1.4.2014 i.e. the date of commencement of the said Section and Rules made thereunder. Since the Company had already appointed to Shri Vijay M. Crishna, Shri P. R. Merchant, Shri P. N. Vencatesan, Shri A. P. Kothari and Shri Pradip Roy as Non- Executive Independent Directors subject to retirement by rotation in the past, in terms of Companies Act, 1956 and the Listing Agreement, and out of them Shri Vijay M. Crishna and Shri A. P. Kothari are liable to retire by rotation at the ensuing Annual General Meeting, the Board of Directors in their meeting held on August 7,

2014 resolved to appoint all the above Non-Executive Independent Directors, subject to the approval of the Members at the ensuing Annual General Meeting as Non-Executive Independent Directors, within the meaning of Section 149 and 152 [including Section 149(10)] of the new Companies Act, 2013 read with Schedule IV attached thereto and Rules made there under, not subject to retirement by rotation, for a term of 5 (five) consecutive years with effect from the date of ensuing Annual General Meeting upto the conclusion of Annual General Meeting of the Company to be held in the calendar year 2019.

The brief resume of the Directors being appointed/re- appointed, the nature of their expertise in specific functional areas, names of companies in which they have held directorships, committee memberships/ chairmanships, their shareholding etc., are furnished in the explanatory statement to the notice of the ensuing Annual General Meeting.

Your Directors therefore, recommend their appointment/re-appointment at the ensuing Annual General Meeting.

11. Acknowledgements

The Directors wish to place on record their deep appreciation of the continued assistance and co-operation from Bank of Baroda, the Administration of Union Territory of Dadra and Nagar Haveli, Palej Gram Panchayat, Palghar Gram Panchayat, Shareholders and all the Staff and employees of the Company

For and on behalf of the Board,

Mahendra R. Mehta, Chairman and Managing Director

Mumbai Dated 7th August, 2014


Mar 31, 2013

TO THE MEMBERS

The Directors hereby present the Twenty Fourth Annual Report of your Company, together with the Audited Accounts for the year ended 31st March, 2013.

1. Financial Results :

(Rupees in Lacs)

2012-13 2011-12 Sales (including Excise Duty) 112779.45 104706.14

Less : Excise Duty (15196.58) (11527.51)

Sales (Net of Excise Duty) 97582.87 93178.63

Operating Profit 4025.83 3776.78

Add : Other Income 126.30 76.35

Profit before Financial Charges,

Depreciation & Taxes 4152.13 3853.13

Financial Charges (506.85) (595.33)

Depreciation (1257.41) (1293.52)

Profit before Taxes &

Extra-ordinary Items 2387.87 1964.28

Extra-ordinary Items

Profit before Taxes 2387.87 1964.28

Less:

Provision for Tax (792.41) (549.78)

Profit after Tax 1595.46 1414.50

Add : Balance brought forward

from last Account 363.53 352.22

Balance available : (A) 1958.99 1766.72

Which the Board of Directors have appropriated as under :

(i) Transfer to General Reserve 1150.00 1000.00

(ii) Proposed Total Dividend 462.54 346.91 @ Rs. 4.00 for the year (Previous year @ Rs. 3.00), which includes Interim Dividend @ Rs. 2.50 (Rs. 1.80), per equity share.

(iii) Corporate Tax on Dividend 76.37 56.28

(B) 1688.91 1403.19

Balance carried forwarded in Profit & Loss Account (A) – (B) 270.08 363.53

2. Dividend

At the Meeting held on 11th February, 2013, the Directors had recommended an interim dividend @ Rs. 2.50 (25%) per equity share of Rs. 10/- each, fully paid, for the financial year 2012-13, since paid. The Directors are pleased to recommend final Dividend @ Rs. 1.50 (15%) per equity share of Rs. 10/- each, fully paid, for the year ended 31st March, 2013, making total dividend recommended of Rs. 4/- (40%) per Equity Share of Rs. 10/- each, fully paid, subject to the approval of Shareholders at the ensuing Annual General Meeting.

3. Operations

Our total production during the year was almost the same as that of previous year. The overall gross sales income was Rs. 1128 Cr [1047 Cr] and income, net of taxes, Rs. 976 Cr [932 Cr]. The increase in the Net Sales Income is due to higher rates of inputs consumed.

For the year, the PBDIT is 4152.13 [3853.13], Finance Charges 506.85 [595.33], Depreciation 1257.41 [1293.52], PBT 2387.87 [1964.28], Provision for Tax 792.41 [549.78], and PAT 1595.46 lacs; which is more than the previous year. Our Reserves and Surplus (excluding Revaluation) are about Rs. 19063 [17993] at the end of March 2013.

During the fiscal, the overall economic and Industrial climate was unfortunately sluggish. Electrical Equipment Manufacturing Industry registered negative growth.

High rates of interest, increase in the cost of our primary inputs, substantial volatility in the foreign exchange, inflation has resulted in the contraction of the production of the domestic Capital-Goods-sector. Due to high cost of proper grade fuel, and issues pertaining to environmental clearances, the Power-sector registered low growth.

Notwithstanding whatever has been stated in the foregoing paragraphs, your Company continues to be optimistic about future growth in the sector. India, being a power-deficit- country, the long term prospects of the Electrical Equipment Manufacturing Industry is bright. Our Government is aware of constraints and has initiated remedial measures. Our Winding Wires, as you are aware, are used in the manufacture of Electrical Equipment, which again depend on the development of Electrical Power sector.

Our Company is looking forward to the future with optimism. India will require to increase its electricity generation capacity by about four times within the next twenty years so as to be able to achieve the projected annual GDP growth of about 7% or so. Besides the Power-sector, infrastructure projects such as airports, metros etc. are expected to generate good demand for electrical equipment. However, the industry will require a level playing field and safeguards against surge of imports as a result of various Trade Agreements signed by our Country. Inherent distortions arising from rapidly increasing Trade Deficit need prompt remedial actions.

Despite an adverse economic climate in the country, your Company has performed well during the year under review.

Your Company has discharged all financial obligations in time, without delay or default and continues to remain a high dividend paying Company with low-debt-gearing.

Your Company continues to be the market-leader in the field of Winding Wires in India. Export efforts continue.

4. Listing / Dematerialisation of the Company''s Equity Shares:

The Equity Shares of your Company continue to be listed at the Bombay Stock Exchange Ltd, (BSE) and National Stock Exchange of India Ltd (NSE) and required Annual Listing Fees have been paid.

The Equity Shares of the Company are compulsorily traded in dematerialized form as prescribed by SEBI. The same are registered with both National Securities Depository Ltd., Trade World, 4th Floor, Kamala Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai - 400 013, and Central Depository Services (India) Limited, Phiroze Jeejeebhoy Towers, 28th Floor, Dalal Street, Mumbai - 400 023, Under ISIN No. INE372C01011 common for both.

5. Particulars of Employees:

As required under the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules 1975, particulars of the employees are given in Annexure I hereto and form part of this report.

6. Disclosure of particulars in the Directors'' Report:

As required under the provisions of Section 217 (1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of particulars in the report of the Board of Directors) Rules 1988, the necessary particulars are given in Annexure II hereto and form part of this report.

7. Auditors:

a) Statutory Auditors :

The Auditors, M/s. S. R. Divatia & Company, Chartered Accountants, Mumbai, who have been Statutory Auditors of the Company, hold office until the ensuing Annual General Meeting. Subject to the approval of the Members, it is proposed to re-appoint them for the Financial Year 2013-14. The Auditors have furnished, u/s 224 (1B) of the Companies Act 1956, Certificate of Eligibility for reappointment.

b) Cost Auditors :

The Cost Accounting records maintained by the Company for Products covered under Central Excise Tariff Act, 1985 Chapter Heading 8544 (Winding Wires Made of Copper) are subject to yearly audit by qualified Cost Auditors.

Based on the Audit Committee recommendation at its meeting held on 28th May, 2012, the Board has appointed M/s. Gangan & Co., Cost Accountants as the Cost Auditor of the Company for the Financial Year 2012-13.

8. Corporate Governance:

As required by Clause 49 of the Listing Agreements with Stock Exchanges, a Corporate Governance Report, a Management Discussion and Analysis, and the Certificate of the Auditors of the Company regarding compliance of conditions of Corporate Governance are made a part of the Annual Report. Please refer Annexure III to the Directors'' Report.

The Company has framed a Code of Conduct for all its Board Members and Senior Management Personnel of the Company, who have affirmed compliance thereto. The said Code of Conduct has been posted on the Company''s website. The Declaration to this effect signed by the CEO is made a part of the Annual Report.

9. Directors'' Responsibility Statement:

Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of Directors of the Company based on the representations received from the operating management confirms:

i. that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. that the directors had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at the end of financial year ended 31st March, 2013 and of the profit of the Company for that period;

iii. that the directors had 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;

iv. that the directors had prepared the annual accounts for the year ended 31st March, 2013, on a going concern basis.

10. Directors:

a) The term of appointment of Shri Deepak M. Mehta, Whole-time Director, expires on 31st July, 2013. On the recommendation of Remuneration-Cum-Selection Committee, the Board of Directors have, at their meeting held on 29th May, 2013, re-appointed Shri Deepak M. Mehta as Whole-time Director for a further period of three years from 1st August, 2013 subject to the approval of the Members of the Company at the ensuing Annual General Meeting and other statutory approval required, if any.

b) In accordance with the provisions of the Companies Act, 1956, and the Company''s Articles of Association, Shri P. N. Vencatesan and Shri P. R. Merchant retire by rotation and are eligible for re-appointment.

11. Acknowledgements

The Directors wish to place on record their deep appreciation of the continued assistance and co-operation from Bank of Baroda, the Administration of Union Territory of Dadra and Nagar Haveli, Palej Gram Panchayat, Shareholders and all the Staff and employees of the Company.

For and on behalf of the Board

Mahendra R. Mehta Chairman and Managing Director

Mumbai,

Dated 29th May, 2013


Mar 31, 2010

The Directors hereby present the Twenty First Annual Report of your Company, together with the Audited Accounts for the year ended 31st March, 2010.

1. Financial Results: (Rupees in Lacs) 2009-10 2008-09 Sales (including Excise Duty) 69706.34 62877.60 Less: Excise Duty (6687.00) (9255.52) Sales (Net of Excise Duty) 63019.34 53622.08 Operating Profit 4436.04 1565.20 Add: Other Income 299.67 71.83 Profit before Financial Charges, Depreciation & Taxes 4735.71 1637.03 Financial Charges (447.55) (398.41) Depreciation (1087.82) (1032.22) Profit before Taxes & Extra-ordinary Items 3200.34 206.40 Extra-ordinary Items 140.58 - Profit before Taxes 3340.92 206.40 Less: Provision for Income Tax (917.00) 0 Provision for Wealth Tax (0.13) (0.20) Provision for Deferred Tax (149.02) (74.63) Provision for Fringe Benefit Tax (0) (11.00) Prior YearsTax Adjustments (12.47) (4.40) Profit after Tax 2262.30 116.17 Add : Balance brought forward from last Account 392.63 389.69 Balance available: (A) 2654.93 505.86 Which the Board of Directors have appropriated as under: (i) Transfer to General Reserve 1700.00 5.00 (ii) Proposed Final Dividend 508.80 92.51 @ Rs. 4.40 for the year (Previous year @ Rs. 0.80), which includes Interim Dividend @ Rs. 2.40 (Nil), per equity share). (iii) Corporate Tax on Dividend 86.47 15.72 (B) 2295.27 113.23 Balance carried forwarded in Profit & Loss Account (A) - (B) 359.66 392.63

2. Dividend

At their Meeting held on 28th January, 2010, the Directors had recommended an interim dividend @ Rs. 2.40 (24%) per equity share of Rs. 10/- each, fully paid, for the financial year 2009-10, since paid. The Directors are pleased to recommend a further Dividend @ Rs. 2.00 per equity share for the year ended 31st March, 2010, making a total dividend recommended of Rs. 4.40 per equity share of

Rs. 10/- each, fully paid, subject to the approval of Shareholders at the ensuing Annual General Meeting.

3. Operations

Due to the fiscal and monetary measures taken by our Government during 2008 and 2009, the overall economic climate improved during the year and this has resulted improvement in the economy and industrial growth.

During the year under review:

[a] the total production of finished goods was about 23500 MT, an increase of approx. 9.40%.

[b] Sales Income Gross and Net of Taxes was Rs. 69706.34 lacs and Rs. 63019.34 lacs respectively. Sales Income is higher during the year due to higher production on own account and lower job work business.

[c] Copper prices remained volatile but in general showed an upward trend during the year. Your Company was able to satisfactorily resolve the residual Copper pricing mis-match related issues which had adversely affected the Companys performance in the previous year.

[d] Based on the experience of extremely high adverse price movements of input, which affected working of the company during last year, the copper procurement policy for customers orders of finished products was modified.

To protect the interest of the Company against Copper price volatility, your Company enters into hedging transactions of Copper. The net loss on Copper Hedging Transactions squared up during the year under review is Rs. 488 lacs (163 lacs) (rounded off) and the same is included in the Cost of Material Consumed (Schedule 11- B to the Profit and Loss Account for the year).

During the year, some consignments of our finished goods sold on own account and on job work account did not reach the plants of our OEM Consumers due to loss en-route. Police complaints have been filed. The goods were insured. The insurance company has disputed the liability in respect of loss of such goods processed on jobwork basis and dispatched to the customers. On such goods sold on own account but lost during transit, pending settlement of insurance claims, an amount of Rs. 101.43 lacs (rounded off) is accounted under loans and advances (Current Assets).

Out of a consignment of copper rods (E C Grade) imported by us from Australia, during December 2007, a total quantity of 33,404 Kgs was lost in transit from Port to our factory. Out of the above, about 29,400 kgs of material was recovered by the Police earlier. As per the Hon. Jurisdictional Courts permission received during the year under review, the same has been reprocessed and consumed. Insurance claim is pending.

Due to the slow-down / melt-down of economy in the previous year, your Company deferred plans for expansion. However, equipments ordered earlier are being received during current year and expansion of capacity will materialize during 2010-11. Company is considering investment in alternate energy generation (wind power) in Gujarat. Plans are afoot for further augmenting capacity in fiscal 2011-12.

Your Company is the Market Leader in the field of winding wires made of Copper in India and continues to explore new export markets. The long term prospects of the Electrical Equipment Manufacturing Industry in general continue to be bright.

The Company has discharged all financial obligations on time.

During the year under review, competition continued to be intense, there was significant inflationary pressure.

On the whole, your Company has managed to perform well and recorded a major turn-around in financial performance despite challenging conditions.

4. Listing / Dematerialisation of the Companys Equity Shares

The Equity Shares of your Company continue to be listed at the Bombay Stock Exchange Ltd., (BSE) and National Stock Exchange of India Ltd (NSE) and required Annual Listing Fees have been paid.

The Equity Shares of the Company are compulsorily traded in dematerialized form as prescribed by SEBI. The same are registered with both National Securities Depository Ltd., Trade World, 4th Floor, Kamala Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai - 400 013, and Central Depository Services (India) Limited, Phiroze Jeejeebhoy Towers, 28th Floor, Dalai Street, Mumbai - 400 023, under ISIN No. INE372C01011 common for both.

5. Particulars of Employees:

As required under the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules 1975, particulars of the employees are given in Annexure I hereto and form part of this report.

6. Disclosure of particulars in the Directors Report:

As required under the provisions of Section 217 (1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of particulars in the report of the Board of Directors) Rules 1988, the necessary particulars are given in Annexure II hereto and form part of this report,

7. Auditors

The Auditors, M/s. S. R. Divatia & Company, Chartered Accountants, Mumbai, who had been Statutory Auditors of the Company, hold office until the ensuing Annual General Meeting. Subject to the approval of the Members it is proposed to re-appoint them for the Financial Year 2010-11. The Auditors have u/s 224 (1B) of the Companies Act, 1956 furnished Certificate of Eligibility for reappointment.

8. Corporate Governance:

As required by Clause 49 of the Listing Agreements with Stock Exchanges, a Corporate Governance Report, a Management Discussion and Analysis, and the Certificate of the Auditors of the Company regarding compliance of conditions of Corporate Governance are made a part of the Annual Report. Please refer Annexure III to the Directors Report.

The Company has framed a Code of Conduct for all its Board Members and Senior Management Personnel of the Company, who have affirmed compliance thereto. The said Code of Conduct have been posted on the Companys website. The Declaration to this effect signed by the CEO are made a part of the Annual Report.

9. Directors Responsibility Statement

Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of Directors of the Company based on the representations received from the operating management confirms:

i. that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. that the directors had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at the end of financial year ended 31a March, 2010 and of the profit of the Company for that period;

iii. that the directors had 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;

iv. that the directors had prepared the annual accounts for the year ended 31st March, 2010, on a going concern basis.

10. Directors

In accordance with the provisions of the Companies Act, 1956, and the Companys Articles of Association, Shri V. M. Crishna and Shri A. P. Kothari retire by rotation and are eligible for reappointment.

The term of appointment of Shri Depak M. Mehta, Whole- time Director, expires on 31st July, 2010. On the recommendation of its Remuneration Committee the Board of Directors have, at their meeting held on 13th May, 2010, reappointed Shri Deepak Mehta as Whole- time Director for a further period of three years from 1st August 2010 subject to the approval of the Company at the ensuing Annual General Meeting.

11. Acknowledgements

The Directors wish to place on record their deep appreciation of the continued assistance and co-operation from Bank of Baroda, the Administration of Union Territory of Dadra and Nagar Haveli, Palej Gram Panchayat, Shareholders and all the Staff and employees of the Company.

For and on behalf of the Board Mahendra R. Mehta Chairman and Managing Director Mumbai, Dated 13th May, 2010

 
Subscribe now to get personal finance updates in your inbox!