Home  »  Company  »  Radha Madhav Corpora  »  Quotes  »  Directors Report
Enter the first few characters of Company and click 'Go'

Directors Report of Radha Madhav Corporation Ltd.

Mar 31, 2015

To,

The Members,

Radha Madhav Corporation Limited,

Dear Sir/Madam

The Directors have pleasure in presenting the Eleventh Annual Report together with the Audited Accounts for the accounting year ended on 31st March, 2015.

FINANCIAL RESULTS

31.03.2015 31.03.2014 Rs. In million Rs. In million

Net Revenue from operation and other Operational Income 1126.78 172.39

Profit (Loss) before Finance cost & Depreciation 61.62 (503.22)

Less: Finance cost 0.12 0.51

Less: Depreciation & amortization 18.27 146.02

Profit After Depreciation & before Exceptional Items & Tax 43.23 (649.75)

Less: Exceptional Items -Expenses/(Income) (1077.79) 143.79

Less: Provision of Tax of earlier year and wealth Tax (62.50) 0.02

Profit /(Loss) after tax 1183.52 (793.56)

OPERATION

Since previous four years before the current year, the Company had been incurring continuous losses and the company has accumulated losses of Rs. 3020.64 millions as on 31stMarch, 2015.

Amongst various reasons, one of the major reasons for such losses had been due to preparation of the RETAIL Venture of the Company

Company operates in two retail and Online Formats namely RMCL Retail and RMCL Universe. Whereas RMCL Retail is a Industrial Retail Format, RMCL Universe is a Consumer Fast Moving Goods Format.

As compared in the year, the Company has started improved performance, which is due to cost engineering techniques adopted by the management. The causes for previous losses are manifold like high cost of finance, overall increase in cost of production (including losses arising out of deficiency of working capital), while there is no corresponding rise in turnover in same proportionate resulting losses.

The management constantly focused on the marketing, creation of Brands and place necessary platforms in place. Such long term measures added heavy expenditure on marketing and brand building.

Current Year had seen Roll-out of Company's Online Ecommerce business named RMCL Universe. With expenses being done during last few years, the results have started yielding for the company. The same trend will continue and will have positive impact on the long-term prospects of the company.

In this year, Company generated revenues of 1126.78 Million INR in comparison to 172.39 Million INR in the previous year. There has been 6.53

Fold increase in revenue.

Similarly Company generated business profit of 43.23 Million INR in comparison to losses of 649.75 Million in previous year. In its effort to deleverage Debts, Company could negotiate its Debt from one of its lender. Negotiated Debt has an impact of 981.94 Million INR on the company. The same has been reversed in the books and resulted into Total Profit of 1183.52 Million. This profit is in comparison of losses of 793.56 Million INR in the previous year.

FINANCE

During the Company has not availed credit facilities from any banks and finance institutions the performance of the last three years has led to significance liquidity pressure in the long term sources.

INSURANCE

All the properties of your Company including Factory, Building, Plant & Machinery, stock etc., are adequately insured.

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS

During the financial year 2014-15, the Board of Directors of the Company, met [12] (Twelve Times) times. The details of which are given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the Listing Agreement.

DECLARATION BY INDEPENDENT DIRECTOR(S) AND RE-APPOINTMENT, IF ANY

All the Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

NOMINATION AND REMUNERATION POLICY OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES DIRECTORS.

In adherence of section 178(1) of the Companies Act, 2013, the Board of Directors of the Company approved a policy on directors' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters provided u/s 178(3), based on the recommendations of the Nomination and Remuneration Committee. The broad parameters covered under the Policy are - Company Philosophy, Guiding Principles, Nomination of Directors, Remuneration of Directors, Nomination and Remuneration of the Key Managerial Personnel (other than Managing / Whole-time Directors), Key-Executives and Senior Management and the Remuneration of Other Employees.

EXTRACT OF THE ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT 9 as per provisions of Companies Act, 2013 and rules thereto is annexed to this report [Annexure-A]

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186

During the financial year ended 31st March, 2015, Neither the Company has not availed any Loan nor has given any Loan, Guarantees and Investment in accordance with section 186 of the Companies Act, 2013

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

There have been no materially significant related party transactions between the Company and the Directors, the management, or the relatives except for those disclosed in the financial statements. Accordingly, particulars of contracts or arrangements with related parties referred to in Section 188(1) along with the justification for entering into such contract or arrangement in Form AOC-2 does not form part of the report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Company's vision is to be a global benchmark in value creation and corporate citizenship and the Company's long-term Corporate Social Responsibility (CSR) objective, is to improve the quality of life of the communities through long-term value creation for all stakeholders. The Company has been a pioneer in various CSR initiatives. We continue to remain focused on improving the quality of life and engaging communities through health, education, sports and infrastructure development.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the said information is available for inspection at Registered Office of the Company during working hours. Any member interested in obtaining such information may write to the Company Secretary, at the registered office and the same will be furnished on request.

DIRECTORS

In accordance with the requirements of the provision of the Companies Act 2013, Subhash Agarwal and Mr. Radhey Krishna Mishra will retire by rotation and, being eligible, have offered themselves for re-appointment . The office of Director Mr. Serge Lapointe became vacant as per section 167 of Companies Act 2013.

AUDITORS AND AUDITORS' REPORT: STATUTORY AUDITORS

Statutory Auditors, M/s. H. P. Shah Associates (Firm Registration No 109588W), Chartered Accountants, Vapi, hold office till the conclusion of ensuing Annual General Meeting and being eligible; offer, themselves for re-appointment to hold the office till the conclusion of next Annual General Meeting are recommended for re-appointment. The certificate from the Auditors have been received to the effect that their re- appointment, if made, would be within the prescribed limit under section 141 of the Companies Act, 2013.

The Auditors have confirmed that they have subjected themselves to the peer review process of the institute of Chartered Accountants of India (ICAI) and holds a valid certificate issued by the Peer Review Board of the ICAI." As to Auditors' Qualifications is self-explanatory in their report.

MANAGEMENT COMMENTS AS TO THE AUDITORS' QUALIFICATION ARE AS FOLLOWS;

1. MANAGEMENTS COMMENTS FOR THE OPINION POINT NO. (a) (going on concern) FORMING PART OF AUDITORS' REPORT and POINT NO.10 ACCUMULATED LOSSES FORMING PART OF ANNEXURES OF THE AUDITORS' REPORT;

As per the view of management there is no uncertainties about continues operation of the Company in foreseeable future on account of following measures taken by the Company;

1. The Company has begun Online E-Commerce business, which is already profitable.

2. The Company has also made profit during the year ended 31.03.2015.

3. The Management has induced long-term capital in the company on various occasions and shall thrive to do so in future.

4. The Management is also planning gradually to modify its business plan by appointing franchise there by reducing working capital intensive dependence.

5. The Company would be able to continue its operation in the foreseeable future through various restructuring and deleveraging measures.

2. MANAGEMENTS COMMENTS FOR THE OPINION POINT NO. (b) (Outstanding balance) FORMING PART OF AUDITORS' REPORT; Company has started dedicated credit control & recovery department headed by a qualified legal expert and has also started serving notices to the defaulting parties. The Company is in process of recovering and has been partially successful. It is confident to recover substantial amount in reasonable time.

3. MANAGEMENTS COMMENTS FOR THE OPINION POINT NO. (c) (Interest payable) FORMING PART OF AUDITORS' REPORT;

The company has not provided interest and also reversed provided interest on credit facilities granted by State Bank of India/AARC and Bank of Baroda due to ongoing Settlement process and due to the fact that interest on Substandard Assets are not charged by the Lenders.

4. MANAGEMENTS COMMENTS FOR THE OPINION POINT NO. (c) (Secured Creditors) FORMING PART OF AUDITORS' REPORT;

Company has booked a gain of INR 980.45 on settlement of Secured loans on the basis of negotiations of the debt at INR 450 Million. Companies in advance process of drafting the restructuring proposal with Alchemist Asset Reconstruction Company Ltd.

5. MANAGEMENTS COMMENTS FOR THE SUB SECTION (a) OF POINT NO.9 STATUTORY DUES & POINT NO. 11. REPAYMENT OF DUES OF FINANCIAL INSTITUTIONS FORMING PART OF ANNEXURES OF THE AUDITORS' REPORT;

The Company was suffering heavy losses and it net worth was also negative so the Company could not pay up.

6. MANAGEMENTS COMMENTS FOR THE SUB SECTION (b) OF POINT NO.9 STATUTORY DUES FORMING PART OF ANNEXURES OF THE AUDITORS' REPORT;

The Company has represented its case to appropriate authorities. It is of the opinion that no such dues shall materialize and hence it has not paid/provided the same.

SECRETARIAL AUDITORS

Section 204 of the Companies Act, 2013 inter-alia requires every listed company to annex with its Board's report, a Secretarial Audit Report given by a Company Secretary in practice, in the prescribed form. The Board of Directors appointed M/s. VBNR & COMPANY, Practicing Company Secretaries as Secretarial Auditor to conduct Secretarial Audit of the Company for Financial Year 2014-15 and their report is annexed to this Board report [Annexure-B]. There are no qualifications, reservations or adverse remarks made by Secretarial Auditors in their Report.

AUDIT COMMITTEE:

The Board of Directors constituted an Audit Committee as per the existing clause 49 of the Listing Agreements entered into with Stock Exchanges and in terms of Section 177 of the Companies Act, 2013. The details of which are given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the Listing Agreement.

DISCLOSURE AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under.

VIGIL MECHANISM:

The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in terms of the Listing Agreement, includes an Ethics & Compliance Task Force comprising senior executives of the Company. Protected disclosures can be made by a whistle blower through an e-mail, or dedicated telephone line or a letter to the CFO or to the Chairman of the Audit Committee.

INTERNAL FINANCIAL CONTROLS

The Company has an internal control system, commensurate with the size, scale and complexity of its operations. The Internal Audit function reports to the Chairman of the Audit Committee of the Board. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and its subsidiaries. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. During the year, such controls were tested and no reportable material weakness in the design or operation were observed.

DIRECTORS RESPONSIBILITY STATEMENT:

Based on the framework of internal financial controls established and maintained by the Company, work performed by the internal, statutory, cost and secretarial auditors and external agencies, the reviews performed by Management and the relevant Board Committees, the Board, with the concurrence of the Audit Committee, is of the opinion that the Company's internal financial controls were adequate and effective as on 31 March, 2015. Accordingly, pursuant to Section 134(5) of the Companies Act, 2013 the Board of Directors to the best of their knowledge and ability confirm:

a) That in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b) That we 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 and loss of the Company for that period;

c) That proper and sufficient care has been taken 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) That the annual accounts have been prepared on a going concern basis;

e) That proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively;

f) That proper internal financial controls were laid down and that such internal financial controls are adequate and were operating effectively

DEPOSITS:

During the year, the Company has not accepted any deposits under the Companies Act, 2013.

CORPORATE GOVERNANCE:

Corporate Governance is a set of principles, processes and systems which govern a company. The elements of Corporate Governance are independence, transparent, accountability, responsibility, compliance ethics, values and trust. Corporate Governance enables an organization to perform efficiently and ethically generate long term wealth and create value for all its stakeholders. The Company believes that sound Corporate Governance is critical for enhancing and retaining investor trust and your Company always seeks to ensure that its performance goals are met with integrity. The Company has established systems and procedures to ensure that its Board of Directors is well informed and well equipped to fulfill its overall responsibilities and to provide management with the strategic direction needed to create long term shareholders value. The Company has always worked towards building trust with shareholders, employees, customers, suppliers and other stakeholders based on the principles of good corporate.

A Separate section on Corporate Governance, Management discussion and Analysis and a Certificate from Company's Auditors regarding compliance of the conditions of the corporate governance as stipulated under clause 49 of the Listing Agreements with the Stock Exchanges forms part of this Annual Report.

Certificate of CEO inter alia, confirming the correctness of the financial statements, adequacy of the internal measures and reporting of matters to the audit committee in terms of the clause 49 of the listing agreements with Stock Exchanges, is also attached as a part of this Annual Report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE

There have been no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations. However, members' attention is drawn to the note on Going Concern, Statement on Contingent Liabilities and Commitments in the notes forming part of the Financial Statements.

APPRECIATION

The Directors take this opportunity to express their appreciation for continued co-operation and assistance extended by Investors, Government Authorities, Bankers, Suppliers and Customers. Your Directors look forward to their continued support. Last but not the least; your Directors also sincerely acknowledge the significant contributions made by the devoted workers, staff and executives for their dedicated services to the Company.

By Order and on behalf of the Board

Place: Daman

Date: 02.09.2015 sd/-

(Mr. Mitesh Agarwal)

MD & CEO


Mar 31, 2014

The Members,

Radha Madhav Corporation Limited,

Dear Sir/Madam

The Directors present their Tenth Annual Report together with the Audited Accounts for the accounting year ended on 31st March, 2014.

FINANCIAL RESULTS 31.03.2014 31.03.2013 (12 Months) (9 months) Rs. In million Rs. In million

Net Revenue from operation and other Operational Income 172.39 200.68

Profit (Loss) before Finance cost & Depreciation (503.22) (823.54)

Less: Finance cost 0.51 460.10

Less: Depreciation & amortization 146.02 698.37

Profit After Depreciation & before Exceptional Items &Tax (793.54) (1982.01)

Less: Exceptional Items -Expenses/ (Income) 143.79 --

Less: Provision of Tax of earlier year and wealth Tax 0.02 0.02

Profit /(Loss) after tax (793.56) (1982.03)

OPERATION

Since last few years, the Company has been incurring continuous losses. The Company has, incurred loss of Rs. 793.56 million during the year and brought forward losses of Rs.3410.47 millions which has resulted into negative net worth of Rs.2931.92 millions as at 31st March, 2014. The company also has working capital deficiency. The causes are manifold like, overall increase in cost of production (including losses arising out of deficiency of working capital), while there is no corresponding rise in turnover in same proportionate resulting losses. The management is constantly focused on the marketing of the product thus which has added heavy expenditure on marketing and brand building. The same will have positive impact on the long term prospects of the company.

In the terms of the duly Audited Accounts of the Company for the financial year ended 30th June, 2012 , the Board of Directors have formed its opinion that the Company has become a Sick Industrial Company within the meaning of section 3(1)(o) of the Sick Industrial Companies (Special Provision) Act, 1985 and a reference is to be made u/s 15 of the said Act to the Board for Industrial and Financial Reconstruction.

FINANCE

The Company has credit facilities from State Bank of India and Bank of Baroda, but the same has been classified as non-performing assets by the Banks. The performance of the last few years has led to significance liquidity pressure in the long term sources.

DEPOSITS:

The Company has not accepted Deposits within the meaning of section 58A of the Companies Act 1956.

INSURANCE

All the properties of your Company including Factory, Building, Plant & Machinery, stock etc., are adequately insured.

DIRECTORS

In accordance with the requirements of the Companies Act 2013, Mr. Anil J. Agrawal, (DIN : 00060250) will retire by rotation being eligible, has offered himself for re-appointment and Mr. Kanubhai Patel (DIN: 00094015) has resigned as Director during the year.

In terms of Section 149 of the Companies Act, 2013, Mr. Subhash Agarwal, (DIN: 05155180), Mr. Serge A Lapointe , (DIN: 01865080), Mr. Radhey Krishna Mishra, (DIN : 02553220) and Mr. Rajiv Prasadkumar Nanavati, (DIN: 02554841) are being appointed as the Independent Directors for the period of five (5) years w.e.f. 1st April, 2014, and are not liable to retire by rotation.

Declaration to the effect that the proposed appointees meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchange has been received from each of the aforesaid Independent Directors. .

AUDITORS:

The present Auditors of the Company M/s. H. P. Shah Associates (Firm Registration No 109588W), Chartered Accountants, Vapi, will retire at the conclusion of ensuing Annual General Meeting and being eligible; offer, themselves for re-appointment to hold the office till the conclusion of next Annual General Meeting.

The Company has also received a certificate from M/s. H. P. Shah Associates, Chartered Accountants, Vapi, under Section 139(1) and Section 141 of the Companies Act, 2013 confirming their eligibility for re-appointment. M/s. H. P. Shah Associates., Chartered Accountants, Vapi , have also confirmed to the Company that the firm is subjected to the Peer Review Process of the Institute of Chartered Accountants of India (ICAI).

Managements Comments as to the Auditors'' Qualifications are as follows:

1. Managements Comments for the opinion (point no. - a), forming part of Auditors'' Report:

As per the view of management there is no uncertainties about continuous operation of the Company in foreseeable future on account following measures taken by the Company:- 1. The Management has also taken various measures to induce long term capital in the Company through various sources.

2. The management is also planning gradually to modify its business plan by appointing franchisee''s and thereby reducing working capital intensiveness.

3. The Company would be able to continue its operation in the foreseeable future through various restructuring measures.

The Board also noted that the various steps taken by management to turn around the operations of the company.

. Company has reviewed its ongoing business in retail mode and has identified approx.20 potential Franchises, which are being short-listed by marketing team, out of that 4 of them have already commenced business with the company The Company''s business through Franchise would increase in order to achieve least dependence on working capital. The Company has also reviewed its brands and corporate brand of RMCL Retail.

. The Company has obtained various approvals and quality certifications at Rudrapur Facility. It also reviewed ISO 22,000 training program for the manufacturing employees and congratulated the team for receiving certificate.

. The Company has noted growing dissatisfaction amongst the labour for the late payment of salaries and ensured to meet again for a strategy to tackle the same in a short time.

2. Managements Comments for the opinion (point no. - b), forming part of Auditors'' Report:

The Company has started dedicated credit control & recovery department is headed by a qualified legal expert and has also started serving notice. to the parties The Company is hopeful of recovering its entire outstanding within reasonable time. Under the present circumstances, company has made adequate provision for bad & doubtful debts which is appropriate in opinion of the Board The Company has also started obtaining confirmation from all remaining debtors, loan advance and sundry creditors and reconciling the outstanding balance.

3. Managements Comments for the opinion (point no. - c), forming part of Auditors'' Report:

Interest on various loan accounted by the company of Rs. 645.75 million has been reversed, for the period starting from the date of its treatment by the bank as Non performing assets as no longer required as considered by the management.

4. Managements Comments for the opinion (point no. - d), forming part of Auditors'' Report:

The company has not provided interest on credit facilities provided by State Bank of India and Bank of Baroda as they have not charged interest on Credit Facilities, since the Company''s Account have been classified as Substandards by the Banks.

5. Managements Comments, for the sub-point (a) of point no. 9 - Statutory Dues & point no .11 - Repayment of Dues of Financial Institutions, forming part of Annexure of the Auditors'' Report:

The Company was suffering heavy losses and its net-worth was also negative so the company could not pay up.

6. Managements Comments, for the sub-point (b) of point no. 9 - Statutory Dues, forming part of Annexure of the Auditors'' Report:

Company has represented its case to appropriate authorities. It is of the opinion that no such dues shall materialize and hence it has not paid/provided for the same.

7. Managements Comments, for the point no .10 - Accumulated Losses, forming part of Annexure of the Auditors'' Report:

The Company in foreseeable future will be able to recover it''s accumulated losses on account following measures taken by the Company:-

1. The Management has also taken various measures to induce long term capital in the Company through various sources.

2. The management is also planning gradually to modify its business plan by appointing franchisee''s and thereby reducing working capital intensiveness.

3. The Company would be able to continue its operation in the foreseeable future through various restructuring measures.

The Board also noted that the various steps taken by management to turn around the operations of the company.

Company has reviewed its ongoing business in retail mode and has identified Franchises, which are being short-listed by marketing team, out of that many of them have already commenced business with the company. The Company''s business through Franchise would increase in order to achieve least dependence on working capital. The Company has also reviewed its brands and corporate brand of RMCL Retail.

The Company has obtained various approvals and quality certifications at Rudrapur Facility. It also reviewed ISO 22,000 training program for the manufacturing employees and congratulated the team for receiving certificate

The Company has noted growing dissatisfaction amongst the labour for the late payment of salaries and ensured to meet again for a strategy to tackle the same in a short time.

8. Managements Comments, for the point no .17 - Mismatch between short term/ long term funds, forming part of Annexure of the Auditors'' Report:

External circumstances, increase in Capital Expenditure, servicing of Debt, delay in project implementation and delayed commercial production, Cash losses due to increased overheads, setting up acceptable Quality products in the market, Creation of multiple product portfolio for its multiple End- users, delay in getting certifications and approvals, delayed market acceptance, Shrinkage in overall demands, etc were reasons for such mismatches.

AUDIT COMMITTEE:

The Board of Directors constituted an Audit Committee as per the existing clause 49 of the Listing Agreements entered into with Stock Exchanges and in terms of Section 292(A) of the Companies Act, 1956.

DIRECTORS'' RESPONSIBILITY STATEMENT:

Your Directors confirm:

i) That in the preparation of the annual accounts, the applicable accounting standards had been followed and that no material departures have been made from the same.

ii) That they had 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 financial year ended 31st March, 2014 and of the profit or loss of the company for that period.

iii) That they had 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 presenting and detecting fraud and other irregularities.

iv) That they had prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE:

A Separate section on Corporate Governance, Management discussion and Analysis and a Certificate from Company''s Auditors regarding compliance of the conditions of the corporate governance as stipulated under clause 49 of the Listing Agreements with the Stock Exchanges forms part of this Annual Report.

Certificate of CEO and CFO, inter alia, confirming the correctness of the financial statements, adequacy of the internal measures and reporting of matters to the audit committee in terms of the clause 49 of the listing agreements with Stock Exchanges, is also attached as a part of this Annual Report.

PARTICULARS OF EMPLOYEES

None of the employees of the Company was paid remuneration of Rs. 60,00,000/- p.a. or more for the year or Rs. 5,00,000/- p.m. or more and hence the information required under section 217 (2-A) of the Companies (Particulars of Employees) Rules, 1975 is not required to be given.

TECHNOLOGY ABSORPTION:

The technology required for the industry is available indigenously.

APPRECIATION

The Directors take this opportunity to express their appreciation for continued co-operation and assistance extended by Investors, Government Authorities, Bankers, Suppliers and Customers. Your Directors look forward to their continued support. Last but not the least, your Directors also sincerely acknowledge the significant contributions made by the devoted workers, staff and executives for their dedicated services to the Company.

For and on Behalf of the Board

sd/- Anil Agrawal Chairman Place: Daman Dated : 29.5.2014


Mar 31, 2013

Dear Members,

The Directors have pleasure in presenting the Ninth Annual Report together with the Audited Accounts for the accounting year ended on 31st March, 2013 (9 months).

FINANCIAL RESULTS

30.06.2013 30.06.2012 (9 months) (15 months) Rs. In million Rs. In million

Net Revenue from operation and other 200.68 1197.72 Operational Income

Profit (Loss) before Finance cost & 823.54 (137.64) Depreciation

Less: Finance cost 460.10 329.56

Less: Depreciation & amortization 698.37 173.24

Profit After Depreciation & before Tax (1982.01) (640.44)

Provision of Tax of earlier year and 0.02 4.11 wealth Tax

Profit /(Loss) after tax (1982.03) (644.55)

OPERATION

Since last four years, the Company has been incurring continuous losses and the company has accumulated losses of Rs.3410.47 millions as on 30th June 2013. The causes are manifold like high cost of finance, overall increase in cost of production (including losses arising out of defi- ciency of working capital), while there is no corresponding rise in turnover in same proportion- ate resulting losses. The management is constantly focused on the marketing of the product thus which has added heavy expenditure on marketing and brand building. The same will have positive impact on the long term prospects of the company.

In the terms of the duly Audited Accounts of the Company for the financial year ended 30th June, 2012, the Board of Directors had formed its opinion that the Company has become a Sick Industrial Company within the meaning of section 3(1)(o) of the Sick Industrial Companies (Spe- cial Provision) Act, 1985 and a reference has been made u/s 15 of the said Act to the Board for Industrial and Financial Reconstruction.

Management 's Opinion of Auditor's Qualification:

Inadequate provisions for bad & doubtful debts to the extent of Rs. 113.97 millions and confirmation of balance and its reconciliation:-

The Company with its dedicated credit control & recovery department headed by a quali- fied legal expert and has served notices. The Company is hopeful of recovering its entire outstanding within reasonable time. Under the present circumstances, company has made adequate provision for bad & doubtful debts which is appropriate in opinion of the Board. The Company has obtained confirmation from all remaining debtors, loan advance and sundry creditors and reconciling the outstanding balance.

Uncertainties about going concern assumption:-

As per the view of management there is no uncertainties about continuous operation of the Company in foreseeable future on account following measures taken by the Company:-

i) The Management has also taken various measures to induce long term capital in the Company through various sources.

ii) The management has diversified / additions in its business plan by appointing franchisee's and thereby reducing working capital intensiveness.

iii) The Company would be able to continue its operation in the foreseeable future through various restructuring measures being initiated..

The Board also noted that the various steps taken by management to turn around the opera- tions of the company.

* The Company earlier identified approx. 75 potential Franchises, which were short- listed by marketing team, 29 of them have already commenced business with the company. The Company's business through Franchise would increase in order to achieve least dependence on working capital. The Company has also reviewed its brands and corporate brand of RMCL Retail.

* The Company has obtained various approvals and quality certifications at Ru- drapur Facility. It also reviewed ISO 22,000 training program for the manufacturing employees and congratulated the team for receiving certificate.

* The Company has noted growing dissatisfaction amongst the labour for the irregular payment of salaries and ensured to meet again for a strategy to tackle the same in a short time.

FINANCE

The Company has availed credit facilities from State Bank of India and Bank of Baroda. The perfor- mance of the last three years has led to significance liquidity pressure in the long term sources.

DEPOSITS:

The Company has not accepted Deposits within the meaning of section 58A of the Companies Act 1956.

INSURANCE

All the properties of your Company including Factory, Building, Plant & Machinery, stock etc., are adequately insured.

DIRECTORS

In accordance with the requirements of the Companies Act 1956, Mr. Anil J. Agrawal, Mr. Mitesh A. Agrawal and Mr. Abhishek Agrawal will retire by rotation and, being eligible, have offered themselves for re-appointment .

AUDITORS:

The present Auditors of the Company M/s. H. P. Shah Associates, Chartered Accountants, Vapi, will retire at the conclusion of ensuing Annual General Meeting and being eligible; offer, them- selves for re-appointment to hold the office till the conclusion of next Annual General Meeting.

They have confirmed for their eligibility for reappointment under section 224(1B) of the Com- panies Act, 1956.

The Auditors have confirmed that they have subjected themselves to the peer review process of the institute of Chartered Accountants of India (ICAI) and holds a valid certificate issued by the Peer Review Board of the ICAI."

As to Auditors' Qualifications is self-explanatory in their report.

AUDIT COMMITTEE:

The Board of Directors constituted an Audit Committee as per the existing clause 49 of the Listing Agreements entered into with Stock Exchanges and in terms of Section 292(A) of the Companies Act, 1956.

DIRECTORS' RESPONSIBILITY STATEMENT:

Your Directors confirm:

i) That in the preparation of the annual accounts, the applicable accounting standards had been followed and that no material departures have been made from the same.

ii) That they had 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 financial year ended 31st March, 2013 (9 months) and of the profit or loss of the company for that period.

iii) That they had 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 presenting and detecting fraud and other ir- regularities.

iv) That they had prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE:

A Separate section on Corporate Governance, Management discussion and Analysis and a Certificate from Company's Auditors regarding compliance of the conditions of the corporate governance as stipulated under clause 49 of the Listing Agreements with the Stock Exchanges forms part of this Annual Report.

Certificate of CEO and CFO, inter alia, confirming the correctness of the financial statements, adequacy of the internal measures and reporting of matters to the audit committee in terms of the clause 49 of the listing agreements with Stock Exchanges, is also attached as a part of this Annual Report.

PARTICULARS OF EMPLOYEES

None of the employees of the Company was paid remuneration of Rs. 60,00,000/- p.a. or more for the year or Rs. 5,00,000/- p.m. or more and hence the information required under section 217 (2-A) of the Companies (Particulars of Employees) Rules, 1975 is not required to be given.

CONSERVATION OF ENERGY Power and fuel Consumption:

31.3.2013 30.6.2012 (9 months) (15 months)

(1) Electricity

Purchased units 2078170 82,32,866

Total Amount (Rs in million) 14.41 40.00

Rate per Unit (Rs.) 6.94 4.86

(2) Own Generator

Fuel (Diesel) (Ltr) 11468 98,350

Total Amount (Rs in million) 0.56 4.02

Rate Per Litter (Rs.) 48.93 40.86

Furnace Oil 35137 3,29,170

Total Amount (Rs in million) 1.60 12.79

Rate Per Litter (Rs.) 45.68 38.84

Rate Per {Kg.} 0.00 0.00

TECHNOLOGY ABSORPTION:

The technology required for the industry is available indigenously.

FOREIGN EXCHANGE EARNING & OUTGO (ON ACCRUAL BASIS):

31.3.2013 (9 months) 30.6.2012 (15 months)

Earning 0.67 17.03

Outgo 0.00 123.24

Most of the Foreign Exchange Outgo is for Purchase of Capital Goods, Spares parts and Raw Materials for the Company.

APPRECIATION

The Directors take this opportunity to express their appreciation for continued co-operation and assistance extended by Investors, Government Authorities, Bankers, Suppliers and Customers. Your Directors look forward to their continued support. Last but not the least, your Directors also sincerely acknowledge the significant contributions made by the devoted workers, staff and executives for their dedicated services to the Company.

For and on Behalf of the Board

sd/- Place: Daman Anil Agrawal Dated : 24th May, 2013 Chairman








Jun 30, 2012

To , The Members of Radha Madhav Corporation Limited,

The Directors have pleasure in presenting the Eighth Annual Report together with the Audited Accounts for the accounting year ended on 30th June, 2012( 15 months).

FINANCIAL RESULTS

30.6.2012 (15 31.3.2011 (12 months) Rs. In million months) Rs. In million

Net Revenue from operation and other 1197.72 1056.44 Operational Income

Profit (Loss) before Finance & Depreciation (137.64) (178.37)

Less: Finance cost 329.56 221.36

Less: Depreciation & amoritzation 173.24 136.97

Profit Afiter Depreciation & before Tax (640.44) (536.70)

Provision of Tax of earlier year and wealth Tax 4.11 1.10

Profit /(Loss) afiter tax (644.55) (537.80)

For the last three years, the Company has been incurring continuous losses and the company has accumulated losses of Rs.142,84,29,052/- as on 30th June 2012, as effected in the Balance Sheet of the Company. The causes are manifold like high cost of finance, overall increase in cost of production (including losses arising out of deficiency of working capital), while there is no corresponding rise in turnover in same proportionate resulting losses. The management is constantly focused on the marketing of the product thus incurred heavy expenditure on marketing and brand building. The same will have positive impact on the long term prospects of the company.

In the terms of the duly Audited Accounts of the Company for the financial year ended 30th June, 2012 , the Board of Directors have formed its opinion that the Company has become a Sick Industrial Company within the meaning of Section 3(1)(o) of the Sick Industrial Companies (Special Provision) Act, 1985 and a reference is to be made u/s 15 of the said Act to the Board for Industrial and Financial Reconstruction.

Management 's Opinion of Auditor's Qualification:

Inadequate provision for bad & doubtful debts to the extent of Rs. 73.93 millions and confirmation of balance and its reconciliation:-

The Company has started dedicated credit control & recovery departiment headed by a qualified legal expert and has also started serving notice. The Company is hopeful of recovering its en- tre outstanding within reasonable time. Under the present circumstances, company has made adequate provision for bad & doubtful debts which is appropriate in opinion of the Board The Company has also started obtaining confirmation from all remaining debtors, loan advance and sundry creditors and reconciling the outstanding balance.

1. Overvaluation of work in progress by Rs. 135.50 million:-

The manufacturing facility of the company can be divided into 15-20 distinct manufacturing areas. With various permutations and combinatons, the company can produce approximately 75-100 different products.

Various sizes, thicknesses, Applications and customization led to large range of finished products that the company has been dealing with. At one point of time we were producing 400 different products at peak level.

Varied input is required for each of the product that is manufactured. Although, basic ingredients revolve around 75-100 large product category but customizaton and specifications led to requirement of Additional input material. Each of Final product requires at least 10- 12 raw material to produce with very less common versatile input material. Hence company was dealing with as large as 1000 different types of raw material at one time.

Liquidity crunch also led to frequent stoppage of business of various product amongst 75-100 large product category hence Raw Material, Work in Progress and receivable of that product category got stuckup. Company with its limited resources tried to rotate its business in all its category and tried to see that its RM, WIP and Receivable do not get stagnant. However it could not be done with the expected efficiency. The same has resulted into slow moving of inventory.

Company has started the roll-out of its long awaited Franchise model whereby Franchise is ready to pay in advance terms for company's product. This will infuse capital and stagnant businesses will be transferred to Franchise. All the RM, WIP and receivable of these discontinued clients will get mobilized with the new business model.

As mentioned above, the company is been taking various steps towards re-arranging its work in progress lying at various units and is also exploring the best possibilities of effective use of inventory.

The board / management is of the genuine belief that management will be able to liquidate the slow moving inventory, thus no need of provisioning of inventory at this point of time.

2. Uncertainties about going concern assumption:-

As per the view of management there is no uncertainties about continuous operation of the Company in foreseeable future on account following measures taken by the Company:- i) The Management has also taken various measures to induce long term capital in the Company through various sources.

ii) The management is also planning gradually to modify its business plan by appointing franchisee's and thereby reducing working capital intensiveness.

iii) The Company would be able to continue its operation in the foreseeable future through various restructuring measures.

The Board also noted that the various steps taken by management to turn around the operations of the company.

- Company has reviewed its ongoing business in retail mode and has identified approx. 20 potential Franchises, which are being short-listed by marketing team, out of that 4 of them have already commenced business with the company. The Company's business through Franchise would increase in order to achieve least dependence on working capital. The Company has also reviewed its brands and corporate brand of RMCL Retail.

- The Company has obtained various approvals and quality certifications at Rudrapur Facility. It also reviewed ISO 22,000 training program for the manufacturing employees and congratulated the team for receiving certfcate.

- The Company has noted growing dissatisfaction amongst the labour for the late payment of salaries and ensured to meet again for a strategy to tackle the same in a short time.

FINANCE

The Company has availed credit facilities from State Bank of India and Bank of Baroda. The performance of the last two years has led to significance liquidity pressure in the long term sources.

DEPOSITS:

The Company has not accepted Deposits within the meaning of section 58A of the Companies Act 1956.

DIRECTORS

In accordance with the requirements of the Companies Act 1956, Mr. Serge A Lapointe, Mr. Radhey Krishna Mishra and Mr. Rajiv Prasankumar Nanavat will retire by rotation and, being eligible, has offered themselves for re-appointment and Mr. Subhash Agarwal is proposed to be appointed as Directors at the ensuing annual General Meeting. Mr. Binodkumar Paliwal re- signed from Directorship during the year

AUDITORS:

The present Auditors of the Company M/s. H. P. Shah Associates, Chartered Accountants, Vapi, will retire at the conclusion of ensuing Annual General Meeting and being eligible; offer, them- selves for re-appointment to hold the Office till the conclusion of next Annual General Meeting.

They have submitted certificate for their eligibility for reappointment under Section 224(1B) of the Companies Act, 1956.

The Auditors have confirmed that they have subjected themselves to the peer review process of the institute of Chartered Accountants of India (ICAI) and holds a valid certificates issued by the Peer Review Board of the ICAI."

As to Auditors' Qualifications is self-explanatory in their report.

AUDIT COMMITTEE:

The Board of Directors constituted an Audit Committee as per the existing clause 49 of the Listing Agreements entered into with Stock Exchanges and in terms of Section 292(A) of the Companies Act, 1956.

CORPORATE GOVERNANCE:

A Separate Section on Corporate Governance, Management discussion and Analysis and a Certificate from Company's Auditors regarding compliance of the conditions of the corporate governance as stipulated under clause 49 of the Listing Agreements with the Stock Exchanges forms part of this Annual Report.

Certificate of CEO and CFO, inter alia, confirming the correctness of the financial statements, adequacy of the internal measures and reporting of matters to the audit committee in terms of the clause 49 of the listing agreements with Stock Exchanges, is also attached as a part of this Annual Report.

INSURANCE

All the properties of your Company including Factory, Building, Plant & Machinery, stock etc., are adequately insured.

PARTICULARS OF EMPLOYEES

None of the employees of the Company was paid remuneration of Rs. 60,00,000/- p.a. or more for the year or Rs. 5,00,000/- p.m. or more and hence the information required under Section 217 (2-A) of the Companies (Particulars of Employees) Rules, 1975 is not required to be given.

CONSERVATION OF ENERGY Power and fuel Consumption:

TECHNOLOGY ABSORPTION:

The technology required for the industry is available indigenously.

DIRECTORS' RESPONSIBILITY STATEMENT:

Your Directors confirm:

i) That in the preparation of the annual accounts, the applicable accounting standards had been followed and that no material departures have been made from the same.

ii) That they had 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 financial year ended 30th June, 2012 (15 months) and of the Profit or loss of the company for that period.

iii) That they had 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 presenting and detecting fraud and other irregularities.

iv) That they had prepared the annual accounts on a going concern basis.

APPRECIATION

The Directors take this opportunity to express their appreciation for continued co-operation and assistance extended by Investors, Government Authorities, Bankers, Suppliers and Customers. Your Directors look forward to their continued support. Last but not the least, your Directors also sincerely acknowledge the significant contributions made by the devoted workers, staff and executives for their dedicated services to the Company.

For and on Behalf of the Board

sd/- Place: Daman Anil Agarwal Dated : 28th July, 2012 Chairman


Mar 31, 2010

The Directors have pleasure in presenting the Sixth Annual Report together with the Audited Accounts for the year ended on 31st March, 2010.

FINANCIAL RESULTS

31.3.2010 31.3.2009 in Lacs in Lacs.

Sales and other Operational Income 16410.54 18129.79

Profit before Depreciation & Tax (3449.24) 936.56

Less: Depreciation 1317.01 855.58

Profit After Depreciation & before Tax (4766.25) 80.98

Provision for Tax (including Deferred, Fringe Benefit 28.28 35.33

Tax and Provision for Wealth Tax )

Profit/(Loss) after tax (4794.53) 45.65

Balance brought forward from Balance sheet 2275.02 2265.29

Provision for Preference Share Dividend (Including Dividend tax) 0 35.92

Balance carried to Balance Sheet (2519.51) 2275.02

OPERATIONS

The decline in financial result as stated above is due to many folds as stated below:

1. The (new) project installed requires, extensive trial runs for stabilization of operations, leading to significant material wastage, resulting higher costs than projected.

2. The new project had a significant proportion catering to the Pharma space, where the company had to cater to new clientele, which could not be achieved as quickly as projected.

3. The project came up at the peak of economic recession during 2nd half of FY 2009. Hence establishing the new products/ sales build up took much more time than expected.

4. Due to liquidity strain and non-availability of working capital facilities from the banks, the company had to resort to credit purchases, leading to higher cost of procurement, thereby affecting operating margins

5. EBITDA margins during FY 09 and FY 1 0 have declined due to higher Raw material consumption %, due to Increase in material wastage to stabilise the operations of the new project.

Inability to ramp up operations, despite higher fixed cost structure built up to market new projects output Reduction in GP margins on account of strained liquidity and working capital position due to pressure from suppliers and customers The Company caters to a very large customer base. This small, the production cost and inventory level are higher Competition: The Company has to face competition from the existing large companies and also from imports.

Outlook and future:

As the products of the company finds a major application in FMCG, Pharmaceuticals and Dairy industry, food forwhich growth prospects are attractive, the Companys prospects are considered satisfactory and is stage of recovery.

FINANCE

The Company has availed additional credit facilities from State Bank of India and Bank of Baroda. The performance of the last two years has led to significant liquidity pressure as shown by the gap in long term sources vis-a-vis applications.

DEPOSITS:

The Company has not accepted Deposits within the meaning of section 58A of the Companies Act 1 956.

DIRECTORS

In accordance with the requirements of the Companies Act 1956, Mr. Anil J. Agrawal, Mr. Mitesh A. Agrawal and Mr. Serge A Lapointe will retire by rotation and, being eligible, has offered himself for re-appointment and Mr. Ashok Agrawal was appointed as an additional Director and has resigned from Directorship during the year.

AUDITORS:

The present Auditors of the Company M/s. H. P. Shah Associates, Chartered Accountants, Vapi, will retire at the

eligible; offer, themselves for re-appointment to hold the office till the conclusion of next Annual General Meeting.

They have submitted certificate for their eligibility for reappointment under section 224(1 B) of the Companies Act, 1 956.

The Auditors have confirmed that they have subjected themselves to the peer review process of the institute of Chartered Accountants of India (ICAI) and holds a valid certificate issued by the Peer Review Board of the ICAI."

AUDITORS OBSERVATION:

As to point No. 17 of Annexure to Auditors Report the Company has utilized fund raised on short term basis for investment on long term basis to the extent of Rs. 38.37 Crore, is due to cash losses, which was partially contributed by the promoters.

AUDIT COMMITTEE:

The Board of Directors constituted an Audit Committee as perthe existing clause 49 of the Listing Agreements entered into with Stock Exchanges and in terms of Section 292(A) of the Companies Act, 1 956.

CORPORATE GOVERNANCE:

A Separate section on Corporate Governance, Management discussion and Analysis and a Certificate from Companys Auditors regarding compliance of the conditions of the corporate governance as stipulated under clause 49 of the Listing Agreements with the Stock Exchanges forms part of this Annual Report.

Certificate of CEO and CFO, inter alia, confirming the correctness of the financial statements, adequacy of the internal measures and reporting of matters to the audit committee in terms of the clause 49 of the listing agreements with Stock Exchanges, is also attached as a part of this Annual Report.

INSURANCE

All the properties of your Company including Factory, Building, Plant & Machinery, stock etc., are adequately insured.

PARTICULARS OF EMPLOYEES

None of the employees of the Company was paid remuneration of Rs. 24,00,000/- p.a. or more for the year or Rs. 2,00,000/- p.m. or more and hence the information required under section 21 7 (2-A) of the Companies (Particulars of Employees) Rules, 1 975 is not required to be given.

DIRECTORS RESPONSIBILITY STATEMENT:

Your Directors confirm:

i) That in the preparation of the annual accounts, the applicable accounting standards had been followed and that no material departures have been made from the same.

ii) That they had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give atrue and fairviewof the state of affairs of the Company at the end of the financial year and of the profit or loss of the company for that period.

iii) That they had 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 presenting and detecting fraud and other irregularities.

iv) That they had prepared the annual accounts on a going concern basis.

APPRECIATION

The Directors take this opportunity to express their appreciation for continued co-operation and assistance extended by Investors, Government Authorities, Bankers, Suppliers and Customers. Your Directors look forward to their continued support. Last but not the least, your Directors also sincerely acknowledge the significant contributions made by the devoted workers, staff and executives for their dedicated services to the Company.

For and on Behalf of the Board

sd/-

Place : Daman Mr. Anil Agarwal

Dated : 28 th May 2010 Chairman



 
Subscribe now to get personal finance updates in your inbox!