Mar 31, 2016
The Directors'' have pleasure in presenting the 30th Annual Report of the Company together with the Audited Accounts for the financial year ended 31st March, 2016.
1. Financial Highlights
The standalone and consolidated financial results of the company for the year ended 31st March, 2016, are as under:
(Rs. in Lacs)
FINANCIAL RESULTS |
STANDALONE |
CONSOLIDATED |
||
|
2015-16 |
2014-15 |
2015-16 |
2014-15 |
Revenue from Operations Profit before Exceptional, Extra ordinary items, |
35763 |
57321 |
44275 |
115263 |
Depreciation, Interest & Tax |
(18303) |
11537 |
(30109) |
14590 |
Depreciation |
13642 |
3899 |
13642 |
3899 |
Profit before Interest & Tax |
(31945) |
7638 |
(43752) |
10691 |
Interest |
12034 |
7060 |
12033 |
7066 |
Profit before Exceptional & Extraordinary Items & Tax |
(43978) |
578 |
(55785) |
3625 |
Prior Period items / Exceptional items |
(2781) |
33 |
(2781) |
33 |
Taxation: Less/ (Add) Current Tax |
0 |
109 |
0 |
109 |
MAT Credit Reversal of Earlier Years /MAT Credit Entitlement |
(2463) |
(109) |
(2463) |
(109) |
Deferred Tax |
(2555) |
(1866) |
(2554) |
(1866) |
Short/Excess Provision of Earlier Years |
(181) |
0 |
(181) |
0 |
NET PROFIT AFTER TAX FOR THE YEAR |
(51958) |
2444 |
(64155) |
5524 |
Add: Balance brought forward |
18622 |
16468 |
30819 |
24180 |
NET SURPLUS AVAILABLE FOR APPROPRIATION |
(33336) |
18912 |
(33336) |
29704 |
Capital Reserve on Consolidation |
- |
- |
- |
- |
Dividend Paid / Dividend Add Back Corporate Tax on Dividend / |
212 |
(241) |
212 |
(241) |
Corporate Tax on Dividend Add Back |
43 |
(48) |
43 |
(48) |
Transfer to General Reserve |
- |
- |
- |
- |
Surplus carried forward to Balance Sheet EPS (Face Value of '' 2 per share) |
(33080) |
18622 |
(33080) |
29415 |
Basic |
(48.92) |
2.37 |
(60.40) |
5.37 |
Diluted |
- |
- |
- |
- |
2. Dividend
Considering the losses incurred in the Financial Year 2015-16, the Board of Directors do not recommend any dividend for the year.
3. Finance
During the year under review, M/s Cargill International Trading Pte Ltd had invoked Export Performance Bank Guarantee to the tune of $ 31.07 Mn., and EPBG amounting to $1.36 Mn. are repaid. Total exposure as on 31.03.2016 towards the EPBG after repayment / invocation is $ 21.94 Mn.
Your Company had pursued to its consortium the request for rectification under Corrective Action Plan duly supported by TEV study report, not considered favorably by the Consortium Bankers. The rectification under Corrective Action Plan would have helped the Company to address the crisis in totality & bring the liquidity issues at manageable level. The Company is pursuing within & outside consortium for the long term resolution to the current financial issues.
4. Operations
During the year under review, the operations of the company were adversely affected on account of under utilization of capacity due to various reasons.
The company is going through severe liquidity crunch & because of no immediate support from bank, company is not able to fully utilize the available capacity. Lower utilization of capacity resulting big amount of losses.
5. Exports & Imports
During the Year under review, your Company has exported 9761.97 MT of paper. The export proceeds amounted to Rs. 3882.66 Lacs. Exports has gone down due to delay in execution of ETP project resulting inability of the company to export certain grades.
Your Company imported 49624.91 MT of waste paper and 448 MT of chemical during the year under review. The imports amounted to Rs. 9237.56 Lacs of waste paper and Rs. 331.09 Lacs of chemicals.
6. DILUTION OF STAKE IN M/S RAINBOW PAPERS JLT, DUBAI
During the year under review, the share capital of Rainbow Papers JLT, Dubai has increased and the shares are allotted to third party. Resultantly, our stake in the said company stands diluted. Therefore, Rainbow Papers JLT, Dubai has ceased to be a subsidiary of your company.
7. Public Deposits
The Company has not accepted or renewed any deposits from the public during the financial year 2015-16.
8. Human Resources
Your Company is committed towards development and creation of opportunities for its employees that help attract, retain and develop a diverse workforce.
During the year under review, the employee turnover ratio was high. Resultantly, the operations of the company were affected and the employee cost increased.
The Company has an employee strength of 1047 employees as on 31st March, 2016.
9. Corporate Social Responsibility (CSR)
As a part of its CSR, the Company makes concentrated efforts in the fields of Community Healthcare, Sanitation & Hygiene, Education & Knowledge Enhancement and Social Care & Concern.
In line with the provisions of the Companies Act, 2013 and rules made there under, Corporate Social Responsibility (CSR) Committee has been formed by the Board of Directors at its meeting held on 12th August, 2014. The Composition of the CSR Committee is as under:
Name of Director |
Category of Directorship |
Designation |
Shri Ajay Goenka |
Managing Director |
Chairperson |
Shri Rahul Maheshwari |
Executive Director |
Member |
Shri Kantibhai Patel |
Independent Director |
Member |
The details about the CSR policy recommended by the CSR Committee and approved by the Board of Directors, along with other details required as per the Companies Act, 2013 and rules made there under are given in the Annual Report on CSR Activities as an Annexure A to this Report.
10. Environment, Health and Safety
The Company is conscious of the importance of environmentally clean and safe operations. The Company''s policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliance of environmental regulations and preservation of natural resources.
The Company accords the highest priority to Environment, Health and Safety. Your Company continues to be accredited with ISO 9001, ISO 14401, OHSAS 18001.
11. Directors and Key Managerial Personnel
During the year under review, Shri Indrasinh B. Zala was appointed as Additional Director (Independent) of the company in the meeting of Board of Directors of the Company held on 12th August, 2015, and his appointment was confirmed at the 29th Annual General Meeting of the Company.
Shri Mahendra Patel and Shri Shashikant Thakar has resigned from the Directorship w.e.f 2nd July, 2015 and 30th December, 2015 respectively.
Shri Pankit Shah, Chief Financial Officer of the Company has resigned from the office w.e.f. 2nd September, 2015 and Smt. Runel Rathi, Company Secretary & Investor Relationship Officer has resigned w.e.f 16th January, 2016 and in her place Shri Shashikant Thakar has been appointed as Company Secretary & Compliance Officer of the Company w.e.f. 16th January, 2016.
Shri Rahul Maheshwari, Executive Director and Shri Kantibhai Patel, Independent Director of the Company, retires by rotation as Director and being eligible, has offered themselves for re-appointment. The Board recommends their re-appointment as Directors as detailed in the notice convening the Annual General Meeting, subject to approval of the shareholders.
12. Composition and number of meetings of the Board
The Board of Directors of the Company comprises of well qualified and experienced persons having expertise in their respective areas. It has appropriate combination of Executive and Non-Executive Directors consisting of one Chairman & Managing Director, one Executive Director, three Independent Director and one Woman Director as required pursuant to Section 149 of the Companies Act, 2013.
The Board meets at regular intervals with gap between two meetings not exceeding 120 days. During the year under review, the Board met 13 times on 7th April, 2015, 14th May, 2015, 29th May, 2015, 2nd July, 2015, 12th August, 2015, 21st August, 2015, 26th August, 2015, 09th November, 2015, 30th December, 2015, 16th January, 2016, 11th February, 2016 and 1st March, 2016.
13. Composition of Audit and Risk Management Committee
In compliance with the requirement of Section 177 of the Companies Act, 2013, the Board of Directors has constituted Audit Committee. The members of the Audit Committee possess financial/accounting expertise and exposure. The Audit Committee assists the Board in its responsibility for overseeing the quality and integrity of the accounting, auditing and reporting practices of the Company and its compliance with the legal and regulatory requirements.
The Audit & Risk Management Committee comprises of the Independent Directors of the Company under the Chairmanship of Mr. Kantibhai Patel. The other independent directors of the Committee are Mr. Shashikant Thakar (up to 30th December, 2015), Mr. Indrasinh B. Zala and Mr. Abhilash Delwadia (w.e.f. 30th December, 2015)
Statutory Auditors, Internal Auditors and Chief Financial Officer are the permanent invitees at the committee meetings. Company Secretary acts as the Secretary of the Committee.
For the Finanacial year 2015-16, the Audit Committee met 5 times on the following dates: 29th May, 2015, 12th August, 2015, 26th August, 2015, 09th November,2015 and 11th February, 2016.
The recommendations given by the Audit Committee are considered and reviewed by the members of the Board of the Company. However, there is no such case where the Board dissented or did not accept the recommendation of the Audit Committee.
The Company has established the vigil mechanism through Whistle Blower Policy for all the stakeholders of the Company which also provides for direct access to the Chairperson of the Audit Committee in appropriate or exceptional cases as per the Policy.
The Whistle Blower Policy will be applicable to all the stakeholder of the Company, which is an extension of the Code of Business Conduct through which the Company seeks to provide a mechanism for the Stakeholders to disclose their concerns and grievances on Unethical Behavior and Improper/Illegal Practices and Wrongful Conduct taking place in the Company for appropriate action. The Company shall oversee the vigil mechanism only through the Audit Committee. If any of the members of the Audit Committee have a conflict of interest in a given case, they should excuse themselves and the others in the Committee would deal with the matter on hand.
14. Policy on Directors'' appointment and remuneration including criteria for determining qualifications, positive attributes, Independence of a Director and other matters provided under Sub-section (3) of Section 178
Pursuance to Section 178 of the Companies Act, 2013, as applicable to the Company, the Company has renamed a "Remuneration Committee" during the financial year 2015-16. The Composition of the Nomination & Remuneration Committee is as under:
1. Shri Kantibhai Patel - Independent Director
2. Shri Shashikant Thakar - Independent Director (up to 30th December, 2015),
3. Shri Indrasinh B. Zala (w.e.f. 12th August, 2015),
4. Smt. Aanal N. Trivedi (w.e.f. 30th December, 2015).
The Committee met twice on 29th May, 2015 and 16th January, 2016.
The Nomination & Remuneration Committee considers the requirement of the skill sets on the Board, integrity of the persons having standing in their respective field/profession and who can effectively contribute to the Company''s business and policy decisions, recommend the appointment to the Board for approval.
The Committee has approved a policy with respect to the appointment and remuneration of the Directors and Senior Management personnel. The objectives of this policy are:
(a) to create a transparent system of determining the appropriate level of remuneration throughout all levels of the Company;
(b) encourage people to perform to their highest level;
(c) allow the Company to compete in each relevant employment market;
(d) provide consistency in remuneration throughout the Company;
(e) align the performance of the business with the performance of key individuals and teams within the Company;
(f) long term value creation; and
(g) attract and retain the best professionals.
The policy details of the types of remuneration to be offered by the Company and factors to be considered by the Board, Nomination & Remuneration Committee and management in determining the appropriate remuneration strategy.
15. Board Evaluation
The Board of Directors has carried out an annual evaluation of its own performance, Board Committees and Individual Directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by Securities and Exchange Board of India (SEBI) under Clause 49 of the Listing Agreements and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The performance of the committee was evaluated by the Board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc.
In a separate meeting of the Independent Directors, performance of Non-Independent Directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of Executive Directors and Non-Executive Directors.
16. Insurance
The Company''s properties including Building, Plant and Machinery, Stocks, Stores, etc., have been adequately insured.
17. Transfer of Unclaimed Dividend to Investor Education and Protection Fund
In terms of Section 125 of the Companies Act, 2013, the unclaimed dividend aggregating to Rs. 1,95,717/lying with the Company for a period of seven years pertaining to the year ended on 31st March, 2008, was transferred during the year 2015-16, to the Investor Education and Protection Fund established by the Central Government.
18. Awards and Accolades
During the year under review, the Company received the following awards:
- "STEAM TECH 2016" for all Gujarat Level Boiler Users Industries is organized by SAKET PROJECTS LTD every year. We have been nominated for the second time wherein following awards were given
a) Award for the Best Boiler Operator,
b) Appreciation Award for the Best Boiler User Industry,
c) Appreciation Award for Best Boiler Engineer.
- Certificate of Appreciation & Certificate of Honour for Best Safety Performance for 2014 by Gujarat Safety Council & Directorate of Industrial Safety & Health Government of Gujarat.
- We have received the Certificate of Merit for the year 2012-13 from CAPEXIL during the function organized at New Delhi on 28.01.2016.
- Shrama Ratna Award was given to three employees of the Company on 20.02.2016 by Department of Labour Ministry, Government of Gujarat.
19. Information Technology
Most of the functional areas of your company are working on IT (Information Technology) platform. To name a few of them: Planning, Raw Material, Purchase, Finance, Sale, Weight Bridge, Production HR etc.
We are working with live ERP systems, modules and functions. Our entire plant is under observation on CCTV cameras and PA System (Public Announcements) for safety and security purpose.
20. Corporate Governance
Corporate Governance is an ethically driven business process that is committed to values aimed at enhancing an organization''s brand and reputation. This is ensured by taking ethical business decisions and conducting business with a firm commitment to values, while meeting stakeholders expectation. At Rainbow Papers Limited, it is imperative that our company affairs are managed in a fair and transpaperent manner. This is vital to gain and retain the trust of our stakeholders.
As stipulated in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report and Report on Corporate Governance form part of this Annual Report. Certificate from Practicing Company Secretary regarding compliance with the conditions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement and Chapter IV of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is also annexed to the Directors'' Report.
21. Credit Rating
The current Bank Loan rating as assigned by the CARE vide their letter dated 20th October, 2015, is as under:-
Facility |
Rated Amount (Rs.in Crores) |
Rating |
Long-term Bank Facilities |
983.16 |
CARE BB & Suspended |
Short-term Bank Facilities |
150 |
CARE A4 & Suspended |
Total |
1133.16 |
|
''BB '' are judged to offer a moderate risk of default regarding timely servicing of financial obligations.
''A4 '' indicates minimal degree of safety regarding timely payment of financial obligations.
22. Dematerialization
The Equity shares of the Company are in compulsory demat segment and are available for trading in the depository system of both National Securities Depository Ltd (NSDL) and the Central Depository Services (India) Ltd. (CDSL). 10,52,47,895 nos. of equity shares forming 99.09% of the equity share capital of the Company stands dematerialized on 31st March, 2016.
23. Listing of Shares
The equity shares of the Company are presently listed on the BSE Ltd, (BSE) and the National Stock Exchange of India Limited (NSE). The BSE & NSE have nationwide terminals and therefore, shareholders/investors are not facing any difficulty in trading of shares of the Company from any part of the Country.
Your Company has paid annual listing fees for financial year 2015-16 to BSE and NSE. Your Company has also paid custodial fees to National Securities Depository Ltd. and Central Depository Services (India) Ltd.
24. Statutory Auditors and their Report
M/s. Mehta Lodha & Co., Chartered Accountants, the Statutory Auditors of the Company who were appointed at the 29th Annual General Meeting to hold office till 33rd Annual General Meeting are subject to ratification. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the rules framed there under for ratification as Auditors of the Company. As required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India. furnished a certificate regarding their eligibility for re-appointment as Statutory Auditors of the Company, pursuant to Section 139 (1) of the Companies Act, 2013 read with rules. The Board of Directors recommends their re-appointment.
The Auditors Report contains following qualification
"Few of the Financial Institution and Bankers have classified their advances to the companies as Non -Performing Assets (NPA) and therefore the provision of interest amounting to Rs 28.59 Crore on the these advance have not been provided by the Company and to that extent loss for the year and lenders liability has been understated."
25. Internal Auditors
Pursuant to the provisions of Section 138 read with Rule 13 of the Companies (Accounts) Rules, 2014, your Company has appointed M/s Dhanesh B. Khatri & Co., Chartered Accountants, as the Internal Auditors of the Company for conducting internal audit for the Financial Year 2016-17.
26. Cost Auditors
M/s. V. H. Shah, Cost Accountant, has been appointed as Cost Auditors for the Financial Year 2016-17 to conduct the cost audit of the accounts maintained by the company. He has confirmed his eligibility for appointment under the provisions of Section 148 of the Companies Act, 2013. The remuneration proposed to be paid to the Cost Auditor is submitted for ratification for approval of the shareholders at the ensuing Annual General Meeting of the Company.
27. Secretarial Audit Report
Pursuant to Section 204 read with Section 134(3) of the Companies Act, 2013, the Board of Directors has appointed M/s. Yogesh Chhunchha & Co., Company Secretaries, Ahmedabad as Secretarial Auditor of the Company for FY 2015-16. The Secretarial Audit Report provided by M/s Yogesh Chhunchha & Co. is annexed with the Board''s Report as Annexure B.
28. MANAGEMENT''S VIEW ON QUALIFICATION
Directors would like to state that your Auditors have given Qualified Report for the Financial Year 2015-16 and in that connection your Directors are of the following views.
"Financial Institutions and Banks have declared advances as NPA, and thus these require no provision of interest in the books of accounts."
29. REFERENCE TO BIFR
On account of erosion of 100% net worth of the Company, The Company has become a Sick Industrial Company under the provisions of the Sick Industrial Companies (Special Provisions) Act 1985. The Company has to file reference to Honourable Board for Industrial and Financial Reconstruction (BIFR) within 60 days to comply the provisions of Section 15(1) of SICA 1985 read with regulation 19 of The BIFR regulations 1987. The management is in process to make due compliances of the law.
30. Directors'' Responsibility Statement
In terms of Section 134 (3) of the Companies Act, 2013, in relation to the financial statements for FY 2015-16, the Board of Directors states that:
a) In preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on 31st March, 2016 and of the loss for the year ended 31st March, 2016;
c) The Directors have taken proper and sufficient care for 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; and
d) the financial statements have been prepared on a going concern basis.
e) the Directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.
f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively
31. Statement on Declaration given by Independent Directors under Sub-Section (6) of Section 149
Shri Kantibhai Patel, Shri Indrasinh B. Zala and Shri Abhilash Delwadia Independent Directors of the Company have given their declarations to the Board that they meet the criteria of Independence as provided under the applicable provisions of the Companies Act, 2013 and Listing Agreement.
32. Particulars of Contracts or Arrangements with Related Parties
All the related party transactions were at arm''s length basis. They were in compliance with the applicable provisions of the Companies Act, 2013 and the Listing Agreement.
All the related party transactions are put forth for the approval of appropriate bodies, as applicable, in compliance with the applicable provisions of the Act. Omnibus approval from the Audit and Risk Management Committee is obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit and Risk Management Committee for its review on quarterly basis, specifying the nature, value and terms and conditions of the transaction.
The particulars of contracts/arrangements entered into by the Company with related parties referred to in subsection (1) of section 188 of the Companies Act, 2013 are annexed to this report as Annexure C.
33. Code of Conduct
The Company has adopted a Code of Business Conduct based on the business principles of the Company. The Board has laid down the code of conduct for all Board members and Senior management of the Company. The code of conduct has been posted on the website of the company. All Board members and Senior management personnel affirms the compliance with the code on an annual basis in the prescribed format.
34. Disclosure under the Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013
The Company has put in place an Anti-Sexual Harassment Mechanism in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committees have been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. The Company has not received any complaint of sexual harassment during the year 2015-16.
35. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
The details relating to conservation of energy, technology absorption, foreign exchange earnings and outgo prescribed under section 134 of the Companies Act, 2013 read with Companies (Account) Rules, 2014 are given in the Annexure D to and form part of this Directors'' Report.
36. Risk Management Policy
The Board of Directors has developed and implemented risk management policy for the Company ensuring that systems of risk management are in place. It has identified and assessed internal and external risks, with potential impact and likelihood, that may impact the Company in achieving its strategic objectives or may threaten its existence. The policy lays down procedures for risk identification, assessment, monitoring, review and reporting.
37. Particulars of Employees
The information required under pursuant to Section 197 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided below:
1. The ratio of the remuneration of each director to the median employee''s remuneration:
Sr.No. |
Name of the Director |
Ratio (Remuneration of Director to Median Remuneration) |
1. |
Ajay Goenka |
13 Times |
2. |
Rahul Maheshwari |
13 times |
2. The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:
Sr. No |
Name |
Designation |
% increase (incl. sitting fees) |
1. |
Ajay Goenka |
Managing Director |
0.00 |
2. |
Rahul Maheshwari |
Executive Director |
0.00 |
3. |
Kanitibhai Patel |
Independent Director |
0.00 |
4. |
Indrasinh Zala |
Independent Director |
0.00 |
5. |
Abhilash Delwadia |
Independent Director |
0.00 |
6. |
Aanal Trivedi |
Director |
0.00 |
7 |
Shashikant Thakar |
Company Secretary |
0.00 |
3. The percentage increase in the median remuneration of employees in the financial year:
~10% (% increase in the remuneration of median employee as on 31.03.2016)
4. The number of permanent employees on the rolls of company:
1047 employees as on 31st March 2016.
5. Comparison of the remuneration of the Key Managerial Personnel against the performance of the Company:
Shri Ajay Goenka (Managing Director), Shri Rahul Maheshwari (Executive Director), have been paid Rs. 24,00,000/- and Rs. 24,00,000/- respectively as remuneration during FY 14-15. During the year under review, they were paid Rs. 24,00,000/- each.
6. Variations in the market capitalization of the company, price earnings ratio as at the closing date of the current financial year and previous financial year:
Market Capitalization |
BSE |
NSE |
31.3.2016 |
1,65,69,89,880 |
1,69,41,65,935 |
31.3.2015 |
8,07,25,14,800 |
7,93,97,43,175 |
P/E Ratio |
BSE |
NSE |
31.3.2016 |
(0.32) |
(0.33) |
31.3.2015 |
32.07 |
31.54 |
percentage increase over decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer in case of listed companies.
7. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year:
Average percentage increase is 10% in FY 15-16
8. Comparison of the each remuneration of the Key Managerial Personnel against the performance of the company
The increase in the remuneration to the Chief Financial Officer and the Company Secretary was in line with the general increase of 10% for all employees of the Company.
9. The key parameters for any variable component of remuneration availed by the Directors: NOT APPLICABLE.
10. The ratio of the remuneration of the highest paid Director to that of the employees who are not Directors but receive remuneration in excess of the highest paid Director during the year:
Sr. No. |
Name of the Employee |
Designation |
Ratio |
1. |
Niyati Agrawal |
Senior Vice President |
0.83 |
2. |
Sangeeta Goenka |
Senior Vice President |
0.99 |
11. Affirmation that the remuneration is as per the remuneration policy of the company:
We hereby affirm that the remuneration paid to the Key Managerial Personnel is as per the remuneration policy of the Company.
12. Name of every employee of the company, who-
i. if employed throughout the financial year, was in receipt of remuneration for that year which, in the aggregate, was not less than sixty lakh rupees âNIL
ii. if employed for a part of the financial year, was in receipt of remuneration for any part of that year, at a rate which, in the aggregate, was not less than five lakh rupees per monthâ NIL
iii. if employed throughout the financial year or part thereof, was in receipt of remuneration in that year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, is in excess of that drawn by the Managing Director or Whole-Time Director or Manager and holds by himself or along with his spouse and dependent children, not less than two percent of the equity shares of the company -NIL
38. Industrial Relations
Industrial Relations remained cordial throughout the year under review. Several industrial relation initiatives implemented by the Company have significantly helped in improving the work culture, enhancing productivity and enriching the quality of life of the workforce.
39. The Extract of the Annual Return
The details forming part of the extract of the Annual Return in Form MGT 9 as required under Section 134 (a) of the Companies Act, 2013, is attached as Annexure E to this Report.
40. Appreciation and Acknowledgements
The Board of Directors places on record its appreciation for the continued support and confidence received from its Bankers and employees of the Company.
The Directors are also thankful to all other stakeholders for their valuable sustained support to the Company.
FOR AND ON BEHALF OF BOARD OF DIRECTORS
PLACE : AHMEDABAD AJAY R. GOENKA
DATE : 07.06.2016 CHAIRMAN & MANAGING
DIRECTOR
Mar 31, 2015
Dear Shareholders,
The Directors' have pleasure in presenting the 29th Annual Report of
the Company together with the Audited Accounts for the financial year
ended 31st March, 2015.
1. Financial Highlights
The standalone and consolidated financial results of the company for
the year ended 31st March, 2015, are as under:
(Rs,in Lacs)
FINANCIAL RESULTS STANDALONE CONSOLIDATED
2014-15 2013-14 2014-15 2013-14
Revenue from Operations 57321 67242 115263 115049
Profit before
Exceptional, Extra
ordinary items,
Depreciation,
Interest & Tax 11537 14237 14590 18044
Depreciation 3899 4787 3899 4787
Profit before
Interest & Tax 7638 9450 10691 13257
Interest 7060 6076 7066 6076
Profit before
Exceptional &
Extraordinary
Items & Tax 578 3374 3625 7181
Prior Period items /
Exceptional items 33 - 33 -
Taxation: Less/
(Add) Current Tax 109 707 109 707
MAT Credit Entitlement (109) (707) (109) (707)
Deferred Tax (1866) 970 (1866) 970
NET PROFIT AFTER
TAX FOR THE YEAR 2444 2404 5524 6211
Add: Balance brought forward 16468 14708 24180 18598
NET SURPLUS AVAILABLE
FOR APPROPRIATION 18912 17112 29704 24809
Capital Reserve
on Consolidation - - - 15
Proposed Dividend/
Dividend Paid 241 396 241 396
Corporate Tax on Dividend 48 67 48 67
Transfer to
General Reserve - 181 - 181
Surplus carried forward
to Balance Sheet 18622 16468 29415 24180
EPS (Face Value of Rs.
2 per share)
Basic 2.37 2.43 5.37 6.28
Diluted - 2.27 - 5.85
2. Dividend and its revocation
The Board of Directors has in its meeting held on 29th May, 2015 had
recommended dividend of 10% i.e. Rs. 0.20 per Equity Share on
10,62,17,300 Equity Shares of Rs. 2/- each for FY 2014-15, amounting to Rs.
212.43 lacs.
However, the Board of Directors of the Company at its meeting held on
12th August, 2015 has decided to revoke the decision of recommendation
of dividend as the Lending Banks / Financial Institutions have not
agreed to the request of the Company on such decision. Accordingly,
the recommendation of dividend stands revoked.
3. Finance
During the year under review, your Company has converted its
outstanding Indian Rupee Term Loan under consortium finance into Non
Fund based limits in the form of Export Performance Bank Guarantee
Limits (EPBG limits). The total exposure of the said EPBG limits was Rs.
326.23 Crores i.e. US$ 54.372 Mn. considered at a notional rate of Rs.
60.00 per US$.
Under the said arrangement, your company has executed Advance Payment &
Supply Agreement (APSA) with an international trading entity M/s
Cargill International Trading Pte. Ltd. for export of its goods over
next 10 years.
Further, the consortium bankers have sanctioned the EPBG and the
validity of this guarantee is initially for a period of 2 years which
will be extended by 2 years every time upto a maximum period of 10
years. The value of Bank Guarantee will get reduced gradually on
execution of Export Orders. The bank guarantee is issued by Consortium
bankers in favour of M/s Cargill International Trading Pte. Ltd. which
can be endorsed/ transferred to the International Bankers.
The said EPBG limits have resulted in drastic savings of interest and
also your company is not required to pay installments for the said Term
Loan on monthly basis.
4. Capacity Expansion
During the year under review, your Company has successfully completed
the installation of Folding Duplex Board plant. Post installation of
the said plant, the production capacity of the Company has gone up to
4,66,700 MTPA. The production from the said machine is mainly used for
the packaging of cosmetics, cigarettes, medicines & electrical
appliances etc.
5. Exports & Imports
During the Year under review, your Company has exported 16148.29 MT of
paper. The export proceeds amounted to Rs. 6,186 Lacs (being 5.32% of
Gross Sales).
Your Company imported 88673.24 MT of waste paper and 496 MT of chemical
during the year under review. The imports amounted to Rs. 11508 Lacs of
waste paper and Rs. 423 Lacs of chemicals.
6. Subsidiary Company
Your company is having one wholly owned subsidiary company viz. Rainbow
Papers JLT, Dubai. The said subsidiary company is engaged in trading of
paper and waste paper.
7. Public Deposits
The Company has not accepted or renewed any deposits from the public
during the financial year 2014- 15.
8. Human Resources
At the core, our underlying belief is that Human Resource Development
is about nurturing human resources and leveraging human capital towards
the achievement of business goals. The Company is committed towards
development and creation of opportunities for its employees that help
in retaining and developing a diversified workforce.
During the year, our focus was on strengthening a conducive work
culture for our employees, reinforce health, safety and well-being of
employees and also uphold our commitment towards ensuring transparency
in business processes. Your organization encourages reporting of
unethical / wrong practices and is committed to creating a constructive
and open work environment. Further, initiatives were introduced to
redefine various policies for employees' empowerment so as to enrich
their professional, personal & social life.
During their tenure at the Company, employees are motivated through
various skill-development, engagement and volunteering programs.
The Company has an employee strength of 1259 employees as on 31st
March, 2015.
9. Corporate Social Responsibility (CSR)
As a part of its CSR, the Company makes concentrated efforts in the
fields of Community Healthcare, Sanitation & Hygiene, Education &
Knowledge Enhancement and Social Care & Concern.
In line with the provisions of the Companies Act, 2013 and rules made
there under, Corporate Social Responsibility (CSR) Committee has been
formed by the Board of Directors at its meeting held on 12th August,
2014. The Composition of the CSR Committee is as under:
Name of Director Category of Directorship Designation
Shri Ajay Goenka Managing Director Chairperson
Shri Rahul Maheshwari Executive Director Member
Shri Kantibhai Patel Independent Director Member
The details about the CSR policy recommended by the CSR Committee and
approved by the Board of Directors, along with other details required
as per the Companies Act, 2013 and rules made there under are given in
the Annual Report on CSR Activities as an Annexure A to this Report.
10. Environment, Health and Safety
The Company is conscious of the importance of environmentally clean and
safe operations. The Company's policy requires conduct of operations in
such a manner, so as to ensure safety of all concerned, compliance of
environmental regulations and preservation of natural resources.
The Company accords the highest priority to Environment, Health and
Safety. Your Company continues to be accredited with ISO 9001, ISO
14401, OHSAS 18001.
11. Directors and Key Managerial Personnel
Subsequent to the notification of Section 149 and other applicable
provisions of the Companies Act 2013, the shareholders have at the 28th
Annual General Meeting of the Company, held on 25th September, 2014,
appointed the Independent Directors - Shri Mahendra Patel, Shri
Kantibhai Patel, Shri Shashikant Thakar for a term of three consecutive
years upto 31st Annual General Meeting of the Company. Smt. Aanal
Trivedi has also been appointed for a term of three years up to 31st
Annual General Meeting of the Company as Woman Director of the Company.
The Shareholders have, in the same meeting, also approved the
reappointment of Shri Rahul Maheshwari as Executive Director of the
Company w.e.f. 30th August, 2014 for a term of three consecutive years.
Shri Mahendra Patel has resigned from the directorship w.e.f 2nd July,
2015 and Shri Indrasinh B. Zala is appointed as Independent Director of
the company in the meeting of Board of Directors of the Company held on
12th August, 2015.
Smt. Aanal Trivedi retires by rotation as Director and being eligible,
has offered herself for re- appointment. The Board recommends her re-
appointment as director as detailed in the notice convening the Annual
General Meeting, subject to approval of the shareholders.
Shri Pankit Shah, Chartered Accountants, has been designated as Chief
Financial Officer (CFO) of the Company w.e.f. 12th August, 2014.
12. Composition and number of meetings of the Board
The Board of Directors of the Company comprises of well qualified and
experienced persons having expertise in their respective areas. It has
appropriate combination of Executive and Non-Executive Directors
consisting of one Chairman & Managing Director, one Executive Director,
three Independent Director and one Woman Director as required pursuant
to Section 149 of the Companies Act, 2013.
The Board meets at regular intervals with gap between two meetings not
exceeding 120 days. Additional meetings are held as and when necessary.
During the year under review, the Board met 14 times on 17th April,
2014, 22nd May, 2014, 30th May, 2014, 19th June, 2014, 28th June,2014,
12th August, 2014, 24th September, 2014, 16th October, 2014, 14th
November,2014, 23rd December, 2014, 7th January, 2015, 29th January,
2015, 14th February, 2015 and 20th March, 2015.
13. Composition of Audit and Risk Management Committee
In compliance with the requirement of Section 177 of the Companies Act,
2013, the Board of Directors has constituted Audit Committee. The
members of the Audit Committee possess financial/accounting expertise
and exposure. The Audit Committee assists the Board in its
responsibility for overseeing the quality and integrity of the
accounting, auditing and reporting practices of the Company and its
compliance with the legal and regulatory requirements.
The Audit Committee of the Company also carries out the role of Risk
Management Committee and hence, it has been renamed as Audit and Risk
Management Committee in the Board Meeting held on 12th August, 2014.
The Audit & Risk Management Committee comprises of the Independent
Directors of the Company under the Chairmanship of Mr. Shashikant
Thakar. The other independent directors of the Committee are Mr.
Kantibhai Patel, Mr. Mahendra Patel (up to 2nd July, 2015) and Mr.
Indrasinh B. Zala (w.e.f. 12th August, 2015) Statutory Auditors,
Internal Auditors and Chief Financial Officer are the permanent
invitees at the committee meetings. Company Secretary acts as the
Secretary of the Committee.
During the financial year 2014-15, the Audit Committee met 5 times on
the following dates: 22nd May, 2014, 30th May, 2014, 12th August, 2014,
14th November,2014 and 14th February, 2015.
The recommendations given by the Audit Committee are considered and
reviewed by the members of the Board of the Company. However, there is
no such case where the Board dissented or did not accept the
recommendation of the Audit Committee.
The Company has established the vigil mechanism through Whistle Blower
Policy for all the stakeholders of the Company which also provides for
direct access to the chairperson of the Audit Committee in appropriate
or exceptional cases as per the Policy.
The Whistle Blower Policy will be applicable to all the stakeholder of
the Company, which is an extension of the Code of Business Conduct
through which the Company seeks to provide a mechanism for the
stakeholders to disclose their concerns and grievances on unethical
behavior and improper/illegal practices and wrongful conduct taking
place in the Company for appropriate action. The Company shall oversee
the vigil mechanism only through the Audit Committee. If any of the
members of the Audit Committee have a conflict of interest in a given
case, they should excuse themselves and the others in the Committee
would deal with the matter on hand.
14. Policy on Directors' appointment and remuneration including
criteria for determining qualifications, positive attributes, indolence
of a director and other matters provided under Sub-section (3) of
Section 178
Pursuant to provision of Section 178 of the Companies Act, 2013, as
applicable to the Company, the Company has renamed "Remuneration
Committee" during the financial year 2014-15 as "Nomination and
Remuneration Committee". The Composition of the Nomination &
Remuneration Committee is as under:
1. Shri Kantibhai Patel  Independent Director
2. Shri Shashikant Thakar - Independent Director
3. Shri Mahendra Patel - Independent Director (upto 2nd July, 2015)
4. Shri Indrasinh B. Zala (w.e.f. 12th August, 2015) The Committee met
on 12th August, 2014.
The Nomination & Remuneration Committee considers the requirement of
the skill sets on the Board, integrity of the persons having standing
in their respective field/profession and who can effectively contribute
to the Company's business and policy decisions, recommend the
appointment to the Board for approval.
The Committee has approved a policy with respect to the appointment and
remuneration of the Directors and Senior Management personnel. The
objectives of this policy are:
(a) to create a transparent system of determining the appropriate level
of remuneration throughout all levels of the Company;
(b) encourage people to perform to their highest level;
(c) allow the Company to compete in each relevant employment market;
(d) provide consistency in remuneration throughout the Company;
(e) align the performance of the business with the performance of key
individuals and teams within the Company;
(f) long term value creation; and
(g) attract and retain the best professionals.
The policy details about the types of remuneration to be offered by the
Company and factors to be considered by the Board, Nomination &
Remuneration Committee and management in determining the appropriate
remuneration strategy.
15. Board Evaluation
The board of directors has carried out an annual evaluation of its own
performance, Board committees and individual directors pursuant to the
provisions of the Act and the corporate governance requirements as
prescribed by Securities and Exchange Board of India (SEBI) under
Clause 49 of the Listing Agreements ("Clause 49").
The performance of the committee was evaluated by the board after
seeking inputs from the committee members on the basis of the criteria
such as the composition of committees, effectiveness of committee
meetings, etc.
In a separate meeting of the independent Directors, performance of
non-independent directors, performance of the board as a whole and
performance of the Chairman was evaluated, taking into account the
views of executive directors and non-executive directors.
16. Insurance
The Company's properties including Building, Plant and Machinery,
Stocks, Stores, etc., have been adequately insured.
17. Global Depository Receipts
As on date, the entire GDR holding has been converted into Equity
Shares. Necessary application has been made on 21st July, 2015 for
delisting of GDR's from Luxembourg Stock Exchange.
18. Transfer of Unclaimed Dividend to Investor Education and Protection
Fund
In terms of Section 125 of the Companies Act, 2013, the unclaimed
dividend aggregating to Rs. 1,45,661/- lying with the Company for a
period of seven years pertaining to the year ended on 31st March, 2007,
was transferred during the year 2014-15, to the Investor Education and
Protection Fund established by the Central Government.
19. Awards and Accolades
During the year under review, the Company received the following
awards:
- Ranked 438 under BW Real 500 rank in Special Issue of Business World
dated 17th November, 2014 (451 in 2013).
- Certificate of Appreciation & Certificate of Honour for best Safety
Performance for 2014 by Gujarat Safety Council & Directorate of
Industrial Safety & Health Government of Gujarat.
- Shrama Ratna Award was given to one employee of the Company and three
employees were awarded Prashansapatra for 2014 by Department of Labour
Ministry , Government of Gujarat.
20. Information Technology
All the functional areas of your company are working on IT (Information
Technology) platform i.e. Planning, Raw Material, Purchase, Finance,
Sale, Weight Bridge, Production, HR etc.
We are working with ERP systems, modules and functions. Our entire
plant is under observation on CCTV cameras and PA System (Public
Announcements) for safety and security purpose.
21. Corporate Governance
Corporate Governance is an ethically driven business process that is
committed to values aimed at enhancing an organization's brand and
reputation. This is ensured by taking ethical business decisions and
conducting business with a firm commitment to values, while meeting
stakeholders expectation. At Rainbow Papers Limited, it is imperative
that our company affairs are managed in a fair and trans apparent
manner. This is vital to gain and retain the trust of our stakeholders.
As stipulated in Clause 49 of the Listing Agreement, the Management
Discussion and Analysis Report and Report on Corporate Governance forms
part of this Annual Report. Certificate of the Auditors regarding
compliance with the conditions of Corporate Governance as stipulated in
Clause 49 of the Listing Agreement is also annexed to the Directors'
Report.
22. Credit Rating
The current Bank Loan rating as assigned by the CARE vide their letter
dated 31st March, 2015, is as under:-
Facility Rated Rating
Amount
(Rs,in Crores)
Long-term Bank
Facilities 983.16 BBB
Short-term Bank
Facilities 150 A3
Total 1133.16
'BBB' are judged to offer a moderate degree of safety regarding timely
servicing of financial obligations.
'A3' indicates moderate degree of safety regarding timely payment of
financial obligations.
23. Dematerialization
The Equity shares of the Company are in compulsory demat segment and
are available for trading in the depository system of both National
Securities Depository Ltd (NSDL) and the Central Depository Services
(India) Ltd. (CDSL). 10,52,26,395 nos. of equity shares forming 99.07%
of the equity share capital of the Company stands dematerialized on
31st March, 2015.
24. Listing of Shares
The equity shares of the Company are presently listed on the BSE Ltd
(BSE) and the National Stock Exchange of India Limited (NSE). The BSE &
NSE have nation wide terminals and therefore, shareholders/investors
are not facing any difficulty in trading in the shares of the Company
from any part of the Country.
The GDR of the Company are listed on Euro MTF Market of Luxembourg
Stock Exchange. However, on account of conversion of entire GDR Holding
necessary application has been made to Luxembourg Stock Exchange on
21st July, 2015 for delisting of its GDRs'.
Your Company has paid annual listing fees for financial year 2015-16 to
BSE and NSE. Annual maintenance and listing agency fee for the calendar
year 2015 has also been paid by the Company to Luxembourg Stock
Exchange, Luxembourg. Your Company has also paid custodial fees to
National Securities Depository Ltd. and Central Depository Services
(India) Ltd.
25. Statutory Auditors and their Report
M/s. P A R Y & Co., Chartered Accountants, the Statutory Auditors of
the Company who were appointed at the 28th Annual General Meeting to
hold office till 33rd Annual General Meeting are subject to
ratification. They have confirmed their eligibility under Section 141
of the Companies Act, 2013 and the rules framed there under for
ratification as Auditors of the Company. As required under Clause 49 of
the Listing Agreement, the auditors have also confirmed that they hold
a valid certificate issued by the Peer Review Board of the Institute of
Chartered Accountants of India. furnished a certificate regarding their
eligibility for re-appointment as Statutory Auditors of the Company,
pursuant to Section 139 (1) of the Companies Act, 2013 read with rules.
The Board of Directors recommends their re- appointment.
The Auditors Report does not contain any qualification, reservation or
any adverse remark.
26. Internal Auditors
Pursuant to the provisions of Section 138 read with Rule 13 of the
Companies (Accounts) Rules, 2014, your Company has appointed M/s
Dhanesh B. Khatri & Co., Chartered Accountants, as the Internal
Auditors of the Company for conducting internal audit for the financial
year 2015-16.
27. Cost Auditors
M/s. V. H. Shah, Cost Accountant, has been appointed as Cost Auditors
for the financial year 2015-16 to conduct the cost audit of the
accounts maintained by the company. He has confirmed his eligibility
for appointment under the provisions of Section 148 of the Companies
Act, 2013. The remuneration proposed to be paid to the Cost Auditor is
submitted for ratification for approval of the shareholders at the
ensuing Annual General Meeting of the Company.
28. Secretarial Audit Report
Pursuant to Section 204 read with Section 134(3) of the Companies Act,
2013, the Board of Directors has appointed M/s. Yogesh Chhunchha & Co.,
Company Secretaries, Ahmedabad as Secretarial Auditor of the Company
for FY 2014-15. The Secretarial Audit Report
provided by M/s Yogesh Chhunchha & Co. is annexed with the Board's
report as Annexure B.
29. Directors' Responsibility Statement
In terms of Section 134 (3) of the Companies Act, 2013, in relation to
the financial statements for FY 2014-15, the Board of Directors states
that:
a) In preparation of the annual accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures, if any;
b) The Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company as on 31st March, 2015 and of the profits for the year
ended 31st March, 2015;
c) the Directors have taken proper and sufficient care for 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; and
d) the financial statements have been prepared on a going concern
basis.
e) the Directors had laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequate and were operating effectively.
f) the directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
30. Statement on Declaration given by Independent Directors under
Sub-Section (6) of Section 149
Shri Kantibhai Patel, Shri Mahendra Patel, Shri Shashikant Thakar and
Shri Indrasinh B. Zala, Independent Directors of the Company have given
their declarations to the Board that they meet the criteria of
Independence as provided under the applicable provisions of the
Companies Act, 2013 and Listing Agreement.
31. Particulars of Contracts or Arrangements with Related Parties
All the related party transactions were at arm's length basis. They
were in compliance with the applicable provisions of the Companies Act,
2013 and the Listing Agreement.
All the related party transactions are put forth for the approval of
appropriate bodies, as applicable, in compliance with the applicable
provisions of the Act. Omnibus approval from the Audit and Risk
Management Committee is obtained for the transactions which are
foreseen and repetitive in nature. A statement of all related party
transactions is presented before the Audit and Risk Management
Committee for its review on quarterly basis, specifying the nature,
value and terms and conditions of the transaction.
The particulars of contracts/arrangements entered into by the Company
with related parties referred to in sub- section (1) of section 188 of
the Companies Act, 2013 are annexed to this report as Annexure C.
32. Code of Conduct
The Company has adopted a Code of Business Conduct based on the
business principles of the Company. The Board has laid down the code of
conduct for all Board members and Senior management of the Company.
The code of conduct has been posted on the website of the company. All
Board members and Senior management personnel affirms the compliance
with the code on an annual basis in the prescribed format.
33. Disclosure under the Sexual Harassment of Women at workplace
(Prevention, Prohibition and Redressal) Act, 2013
The Company has put in place an Anti-Sexual Harassment mechanism in
line with the requirements of the Sexual Harassment of Women at the
Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal
Complaints Committees have been set up to redress complaints received
regarding sexual harassment. All employees (permanent, contractual,
temporary, trainees) are covered under this policy. The Company has not
received any complaint of sexual harassment during the year 2014-15.
34. Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings and Outgo
The details relating to conservation of energy, technology absorption,
foreign exchange earnings and outgo prescribed under section 134 of the
Companies Act, 2013 read with Companies (Account) Rules, 2014 are given
in the Annexure D and forms part of this Directors' Report.
35. Risk Management Policy
The Board of Directors has developed and implemented risk management
policy for the Company ensuring that systems of risk management are in
place. It has identified and assessed internal and external risks, with
potential impact and likelihood, that may impact the Company in
achieving its strategic objectives or may threaten its existence. The
policy lays down procedures for risk identification, assessment,
monitoring, review and reporting.
36. Particulars of Employees
The information required pursuant to Section 197 read with the
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014 are provided below:
1. The ratio of the remuneration of each director to the median
employee's remuneration:
Sr.
No. Name of the Director Ratio (Remuneration of Director to
Median Remuneration)
1. Ajay R Goenka 13 Times
2. Rahul J Maheshwari 13 times
2. The percentage increase in remuneration of each director, Chief
Financial Officer, Chief Executive Officer, Company Secretary or
Manager, if any, in the financial year:
Sr.
No Name Designation % increase (incl.
sitting fees)
1. Ajay Goenka Managing Director -83.15
2. Rahul Maheshwari Executive Director -5.91
3. Shashikant Thakar Independent Director 5.26
4. Mahendrabhai Patel Independent Director 29.17
5. Kanitibhai Patel Independent Director -52.78
6. Aanal Trivedi Director -
7. Runel Rathi Company Secretary 5.40
8. Pankit Shah CFO -
3. The percentage increase in the median remuneration of employees in
the financial year:
- 10% (% increase in the remuneration of median employee as on
31.03.2015)
4. The number of permanent employees on the rolls of company:
1259 employees as on 31st March 2015.
5. Comparison of the remuneration of the Key Managerial Personnel
against the performance of the company:
Shri Ajay Goenka (Managing Director), Shri Rahul Maheshwari (Executive
Director), have been paid Rs. 1,42,43,243/- and Rs. 25,50,852/-
respectively as remuneration during FY 13-14. During the year under
review, they were paid Rs. 24,00,000/- each.
6. Variations in the market capitalization of the company, price
earnings ratio as at the closing date of the current financial year and
previous financial year:
Market BSE NSE
Capitalization
31.3.2015 8,07,25,14,800 7,93,97,43,175
31.3.2014 7,37,81,61,315 7,39,79,55,175
P/E Ratio BSE NSE
31.3.2015 32.07 31.54
31.3.2014 30.68 30.76
percentage increase over decrease in the market quotations of the
shares of the company in comparison to the rate at which the company
came out with the last public offer in case of listed companies.
7. Average percentile increase already made in the salaries of
employees other than the managerial personnel in the last financial
year:
Average percentage increase is 10% in FY 14-15
8. Comparison of the each remuneration of the Key Managerial Personnel
against the performance of the company
The increase in the remuneration to the Chief Financial Officer and the
Company Secretary was in line with the general increase of 10% for all
employees of the Company.
9. The key parameters for any variable component of remuneration
availed by the directors: NOT APPLICABLE.
10. The ratio of the remuneration of the highest paid director to that
of the employees who are not directors but receive remuneration in
excess of the highest paid director during the year:
Sr. Name of the Designation Ratio
No. Employee
1. Niyati Agrawal Senior 0.83
Vice President
2. Sangeeta Goenka Senior 0.99
Vice President
11. Affirmation that the remuneration is as per the remuneration
policy of the company:
We hereby affirm that the remuneration paid to the Key Managerial
Personnel is as per the remuneration policy of the Company.
12. Name of every employee of the company, who-
i. if employed throughout the financial year, was in receipt of
remuneration for that year which, in the aggregate, was not less than
sixty lakh rupees ÂNIL
ii. if employed for a part of the financial year, was in receipt of
remuneration for any part of that year, at a rate which, in the
aggregate, was not less than five lakh rupees per month NIL
iii. if employed throughout the financial year or part thereof, was in
receipt of remuneration in that year which, in the aggregate, or as the
case may be, at a rate which, in the aggregate, is in excess of that
drawn by the managing director or whole-time director or manager and
holds by himself or along with his spouse and dependent children, not
less than two percent of the equity shares of the company -NIL
37. Industrial Relations
Industrial Relations remained cordial throughout the year under review.
Several industrial relation initiatives implemented by the Company have
significantly helped in improving the work culture, enhancing
productivity and enriching the quality of life of the workforce.
38. The Extract of the Annual Return
The details forming part of the extract of the Annual Return in Form
MGT 9 as required under Section 134 (a) of the Companies Act, 2013, is
attached as Annexure E to this Report.
39. Appreciation and Acknowledgements
The Board of Directors places on record its appreciation for the
continued support and confidence received from its Bankers and
employees of the Company.
The Directors are also thankful to all other stakeholders for their
valuable sustained support to the Company.
FOR AND ON BEHALF OF BOARD OF DIRECTORS
PLACE: AHMEDABAD AJAY R. GOENKA
DATE : 12th AUGUST, 2015 CHAIRMAN &
MANAGING DIRECTOR
Mar 31, 2014
Dear Members,
The Directors have great pleasure in presenting herewith the 28th
Annual Report together with the audited statements for the financial
year ended 31st March, 2014.
Financial Highlights:
The standalone and consolidated results of your company for the
financial year ended on 31st March, 2014 are summarized herein below:
(Rs. in Lacs)
FINANCIAL RESULTS CONSOLIDATED
2013-14 2012-13
Revenue from Operations 115049.27 91548.69
Profit before Exceptional, Extra ordinary items,
Depreciation, Interest & Tax 18719.86 13647.56
Depreciation 4786.62 2662.32
Profit before Interest & Tax 13933.24 10985.24
Interest 6752.52 3669.75
Profit before Exceptional & Extraordinary Items
& Tax 7180.72 7315.49
Prior Period items/Exceptional items - 12.29
Taxation: Less/(Add) Current Tax 707.16 948.28
MAT Credit Entitlement (707.16) (748.17)
Deferred Tax 970.03 1013.67
NET PROFIT AFTERTAX FOR THE YEAR 6210.69 6114.00
Add: Balance brought forward 18598.43 13244.30
NET SURPLUS AVAILABLE FOR APPROPRIATION 24809.12 19358.30
Capital Reserve on Consolidation 15.33 -
Proposed Dividend/ Dividend Paid 395.88 418.87*
Corporate Tax on Dividend 67.28 71.00
Transfer to General Reserve 181.00 270.00
Surplus carried forward to Balance Sheet 24180.29 18598.43
EPS (Face Value of Rs. 2 per share)
Basic 6.28 6.46
Diluted 5.85 6.30
(Rs. in Lacs)
FINANCIAL RESULTS STANDALONE
2013-14 2012-13
Revenue from Operations 67241.72 54217.24
Profit before Exceptional, Extra ordinary items,
Depreciation, Interest & Tax 14236.90 10675.78
Depreciation 4786.62 2662.31
Profit before Interest & Tax 9450.28 8013.47
Interest 6076.49 3276.29
Profit before Exceptional & Extraordinary Items
& Tax 3373.79 4737.18
Prior Period items/Exceptional items - 12.29
Taxation: Less/(Add) Current Tax 707.16 947.80
MAT Credit Entitlement (707.16) (748.17)
Deferred Tax 970.03 1013.67
NET PROFIT AFTERTAX FOR THE YEAR 2403.76 3536.16
Add: Balance brought forward 14707.96 11931.68
NET SURPLUS AVAILABLE FOR APPROPRIATION 17111.72 15467.84
Capital Reserve on Consolidation - -
Proposed Dividend/ Dividend Paid 395.88 418.87*
Corporate Tax on Dividend 67.28 71.00
Transfer to General Reserve 181.00 270.00
Surplus carried forward to Balance Sheet 16467.56 14707.96
EPS (Face Value of Rs. 2 per share)
Basic 2.43 3.74
Diluted 2.27 3.64
*Previous figures have regrouped/rearranged wherever necessary.
Dividend:
Your Directors are pleased to recommend a Dividend @ Rs. 0.40 per
Equity Share (previous year Rs. 0.40 per Equity Share) on the face
value of Rs. 2/- each for the year ended 31st March, 2014.
The dividend, subject to approval of members at the Annual General
Meeting on 25th September, 2014, will be paid on or after 30th
September, 2014 to the Members whose names appear in the Register of
Members, as on the date of book closure i.e. from 19th September, 2014
to 25th September, 2014 (inclusive of both dates). The total dividend
payout for the financial year will be Rs. 424.86 Lacs and the Dividend
Distribution Tax of Rs. 72.21 Lacs which includes the divided for new
equity shares allotted during the year. The new equity shares allotted
on conversion of warrants, before the record date are entitled for
dividend and the total dividend amount may be increased to that extent.
Transfer to Reserves
A sum of Rs. 181.00 Lacs is proposed to be transferred to the General
Reserves out of the total amount available for appropriations. An
amount of Rs. 24180.29 Lacs is proposed to be retained in the statement
of profit and loss.
Share Capital
Your Company has allotted 75,00,000 Equity Shares at Rs. 81/ - per
share in three tranches at different dates on conversion of warrants.
Post conversion, the issued and paid up capital of the company stands
at Rs. 21,24,34,600/- as on 12th August, 2014.
Review of Operations:
The brief highlights of the consolidated results of the
Company during the year are as under:
. Your company has achieved total production of 1,71,898.47 MT as
compared to 1,49,251.23 MT in the previous year recording yoy growth of
16%.
. Your company has recorded Gross Sales of Rs. 1161.4Crores as compared
to Rs. 921.4 Crores for FY13, recording a yoy growth of 26%.
. The EBITDA for the financial year 2013-14 is Rs. 187.2 Crores compared
to Rs. 136.5 Crores during the previous year, registering a growth of
37% yoy.
. The Net Profit is at Rs. 62.2 Crores compared to Rs. 61.1 Crores last
year, generating a yoy growth of 2%.
Subsidiary Companies:
Your company is having one wholly owned subsidiary company viz. Rainbow
Papers JLT, Dubai. The said subsidiary company is engaged in trading
business of paper.
In accordance with the general exemption granted by the Ministry of
Corporate Affairs, Government of India, the Balance Sheet, Statement of
Profit and Loss, Directors'' Report, Auditors'' Report etc. of the
subsidiary companies are not attached with the Annual Report of your
company.
The annual accounts of your Company''s subsidiaries as stated above and
the related information shall be made available to the shareholders of
the Company and its subsidiaries upon receipt of a request from them.
Such statements shall also be kept open for inspection at the
Registered Office of your Company during business hours.
Capacity expansion:
During the year under review, your Company has successfully completed
the mill modernization project and installation of Notebook & Copier
Paper plant. With this the total production capacity of the Company has
gone up by 29,700 MT making the total capacity as 3,34,700 MTPA.
The project pertaining to installation of Folding Duplex Board is under
progress. The proposed capacity of said plant is 132,000 MTPA. The
plant is expected to be commissioned by the end of Financial Year 2015.
The production from the said machine shall be used in the packaging of
cosmetics, cigarettes, medicines, electrical appliances, etc.
Post installation of folding duplex board, the production capacity will
be 4,66,700 MTPA by the end of F.Y. 2015.
Finance:
Your Company maintained cordial relationships with its bankers and was
able to avail and negotiate favorable terms for various banking
facilities.
"Zero Discharge" Strategy:
Along with backward integration, the Company has also adopted "Zero
Discharge" strategy which not only improves operational efficiency but
also augments earning margins. The following are the major areas
forming part of this strategy:
- Efficient plant layout and different product mix allows better
utilization of raw material.
- Sludge from paper plant used as raw material in paper board.
- Plastics obtained in waste -paper is converted into
rooftop-corrugated sheets.
These by-products improve operating efficiency and augment earning
margins.
Exports:
Your Company exported 22,222.24 MT of paper during the year under
review. The export proceeds amounted to Rs. 8,354 Lacs (being 8% of
Gross Sales) as compared to Rs. 9,245 Lacs during the previous year.
The main contributors for the satisfactory export performance were
increased focus on export market development and product quality that
matched the international standards.
With firm commitments and through sustained efforts, your Company
continues to maintain good rapport with global customers. Our quality
products and timely delivery have found wide acceptance in the highly
competitive international market.
The Company has a strong presence in the international markets such as
USA, Middle East, South-Africa and UK and exports nearly 20% of its
production in these countries. The Company also has a wholly-owned
subsidiary, Rainbow papers JLT, which is based in Dubai, UAE. Rainbow
Papers Ltd. has been a consistent exporter of paper and also one of the
leading exporter from India in the last few years.
Board of Directors:
During the year under review, Shri Rajendra Patawari resigned from the
board w.e.f 21st October, 2013. The board places on record appreciation
for the services rendered by him as a director of the company.
Under the provisions of the Companies Act, 2013, the Board of Directors
at its meeting held on 12th August, 2014, had re-appointed Shri Rahul
Maheshwari as Executive Director of the Company for a period of 3 years
w.e.f. 30th August, 2014 subject to approval of members in General
Meeting.
Shri Ajay Goenka, Managing Director of the Company is liable to retire
by rotation at this Annual General Meeting and being eligible offers
himself for re-appointment.
Shri Mahendrabhai Patel and Mrs. Aanal Trivedi had been appointed as
additional directors on the Board of the Company on 21st October, 2013
and 12th August, 2014 respectively. In terms of Section 161 of the
Companies Act, 2013, Shri Mahendrabhai Patel and Smt. Aanal Trivedi
hold office upto the ensuing Annual General Meeting of the Company.
Your Company has received requisite notices in writing from the member
proposing their names for the office of Director.
As per the provisions of the Companies Act, 2013, Independent Directors
are required to be appointed for a maximum term of five consecutive
years and shall not be liable to retire by rotation. Accordingly,
resolutions proposing appointment of Independent Directors form part of
the Notice of the Annual General Meeting. The Board therefore proposes
the appointment of Shri Kantibhai Patel, Shri Mahendrabhai Patel, Shri
Shashikant Thakar and Smt. Aanal Trivedi as Independent Directors on
the Board of the Company for consecutive period of 3 years commencing
from the ensuing Annual General Meeting of the Company upto 31st Annual
General Meeting of the Company. As stipulated under Clause 49 of the
Listing Agreement with the Stock Exchanges, brief profile of the
Directors proposed to be re-appointed, nature of their expertise
specific functional areas, names of companies in which they hold
directorships and memberships/chairmanships of the Board Committees and
shareholding are provided in the Report on Corporate Governance forming
part of the Annual Report.
Directors'' ResponsibiIity Statement:
Pursuant to the requirements under Sub Section 2AA of Section 217 of
the Companies Act, 1956, with respect to the Directors'' Responsibility
Statement, it is hereby confirmed:-
(1) that in the preparation of Annual Accounts, the applicable
Accounting Standards (AS) have been followed along with the proper
explanation relating to material departures, if any.
(2) that the Directors have selected such accounting policies and
applied them consistently and made judgement and estimates that are
reasonable and prudent so as to give true and fair view of the state of
affairs of the Company as at 31st March, 2014 and of the Profit for the
year ended on that date.
(3) that the Directors to the best of their knowledge and ability have
taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Companies
Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities.
(4) that the annual accounts have been prepared on a going concern
basis.
Audit Committee:
Pursuant to the provisions of Section 292A of the Companies Act, 1956,
the Board of Directors of the Company has constituted a committee of
Board of Directors as Audit Committee which now consists of the
following members:
1. Shri Shashikant Thakar : Chairman & Independent Director
2. Shri Mahendra Patel : Independent Director
3. Shri Kantibhai Patel : Independent Director
Audit Committee has such powers and authority as provided under the
provisions of the Companies Act, 1956 as well as the Companies Act,
2013 and the rules made thereunder and Listing Agreement and acts in
accordance with the terms of reference specified in writing by the
Board of Directors from time to time.
Fixed Deposits:
The Company has not accepted any fixed deposits and as such, no amount
of principal or interest on public deposits was outstanding as on the
date of the balance sheet.
Insurance: The Company''s properties including Building, Plant and
Machinery, Stocks, Stores, etc., have been adequately insured.
Global Depository Receipts:
The total no. of GDRs outstanding for conversion as on date are
2,86,39,725.
Transfer of Unclaimed Dividend to Investor Education and Protection
Fund:
In terms of Section 125 of the Companies Act, 2013, the unclaimed
dividend aggregating to Rs. 1,45,280/- lying with the Company for a
period of seven years pertaining to the year ended on 31st March, 2006,
was transferred during the year 2013-14, to the Investor Education and
Protection Fund established by the Central Government.
Infrastructure:
The manufacturing facility of the Company is located approximately 40
kms from Ahmedabad, 350 kms from Mundra Port & 550 kms from N hava
Sheva Port, thus offering good logistical advantage. It not only
ensures steady raw material supply of imported waste paper but also
provides easy access to global markets like Middle East, Africa, thus
providing a boost to its export business. Apart from this, the Company
also saves on freight cost within India which sometimes forms a major
portion of the total cost.
Besides, one of the critical inputs for paper production is
uninterrupted power supply. Disrupted power supply not only hampers
production but also impact client manufacturing process, thus affecting
the relationship. Hence, in order to ensure quality power supply, your
Company has set up a 35MW captive power plant which is sufficient for
the total capacity of 4,66,700 MTPA.
Awards and Accolades:
Your company has received the following awards during the year under
review:
. "Excellent Achievement Award"has been conferred to our CMD, Shri Ajay
Goenka at Paperex 2013 towards outstanding contribution to the growth
and development of the pulp and paper industry in the country sponsored
and supported by the Indian Paper Industry and co-sponsored by the
Ministry of Industry & Commerce, Ministry of Small Scale Industry,
Govt. of India, TAPPI, CPPRI-lndia, IIPTA-lndia etc.
. Your Company has been ranked as 108 under the India''s fastest growing
mid-sized companies by Inc. India 500 for the year 2013 during the
fifth Inc. India 500Awards. We were ranked as 272 for the year 2012.
. Your Company has won the Gujarat State Safety Award 2012 during the
35th Annual Safety conference. The award consists of "Certificate of
Honour & Appreciation" from Gujarat Safety Council Vadodara,
Directorate of Industrial Safety & Health Gujarat State.
. Your Company has been awarded Certificate of Excellence in recognition
of smart innovation by Inc. India Innovative 100 for 2013.
. Your Company has received the Special Award in recognition of
outstanding export performance in respect of Paper and Paper Board by
CAPEXIL for the fourth consecutive year.
. Your company is ranked as 582 for 2013 in Business Standard (BS1000).
. Two employees of our company - Mr. Mukesh Kantilal Patel and Ms.
Javanikaben Arvindbhai Patel have been conferred with Shram Bhusan and
Shram Devi Award 2013 respectively by Labour and Employment Department,
Government of Gujarat.
. "Excellence Award for Best Boiler House Operator" in Gujarat State
Steamtech has been awarded to one of our employees Mr. Anil K. Patel.
. Your Company has been declared as a winner of Quality Mark Awards 2014
under the category Gujarat Pioneer Industries.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings and Outgo:
The particulars as prescribed under section 217 (1)(e) of the Companies
Act, 1956 read with the Companies [Disclosure of particulars in the
Report of Board of Directors) Rules, 1988 are set out in an annexure to
this report.
Particulars of Employees:
The information required as per Section 217 (2A) of the Companies Act,
1956 and the rules made thereunder in respect of employees of the
Company, is provided in annexure forming part of this report.
Corporate Governance: The
Company is committed to maintain the highest standards of Corporate
Governance and adhere to the Corporate Governance requirements as set
out by SEBI.
The Report on Corporate Governance as stipulated under Clause 49 of the
Listing Agreement forms part of the Annual Report.
A requisite certificate from the Statutory Auditors of the Company,
confirming compliance with the conditions of Corporate Governance, as
stipulated under clause 49, is attached to this report.
Information Technology:
Most of the functional areas of your company are working on IT
(Information Technology) platform. To name a few of them: Planning, Raw
Material, Purchase, Finance, Sale, Weight Bridge, Production, HR etc.
We are working with live ERP systems, modules and functions. Our entire
plant is under observation on CCTV cameras and PA System (Public
Announcements) for safety and security purpose.
Environment and Safety:
The Company is conscious of the importance of environmentally clean and
safe operations. The Company''s policy requires conduct of operations in
such a manner, so as to ensure safety of all concerned, compliances,
environmental regulations and preservation of natural resources.
Corporate Social Responsibility:
Over the years, we have been striving to achieve a fine balance of
economic, environmental and social imperatives, while also playing
attention to the needs and expectations of our internal as well as
external stakeholders.
Pursuant to the provisions of Section 135 of the Companies Act, 2013,
our Board of Directors at its meeting held on 12th August, 2014, have
constituted Corporate Social Responsibility (CSR) Committee of the
Board of Directors consisting of the following members:
1. Shri Ajay Goenka - Managing Director
2. Shri Rahul Maheshwari - Executive Director
3. Shri Kantibhai Patel - Independent Director
Accreditations & Certifications:
Your Company continues to hold the following:
a) ISO 9001 / ISO 14001 Accreditation
Your Company''s Quality Management Systems continue to be covered by the
"ISO 9001" accreditation. Company''s Environmental Management System
continues to enjoy "IS014001 "accreditation.
b) OHSAS 18001 Certification
Your Company continues to enjoy certification under Occupational Health
and Safety Assessment Series 18001 (OHSAS) which isan International
Standard which facilitates management of Occupational Health and Safety
risks associated with the business of the organization.
c) Star Export House
Your Company is recognized and awarded as "Star Export House" by
Director General of Foreign Trade, New Delhi.
d) Forest Stewardship Council (FSC) Certification
Scientific Certification Systems (SCS), who is accredited by the FSC,
has awarded to your Company, the Forest Stewardship Council (FSC)
Certification, valid till May, 2015. FSC is an international
certification and labeling system that guarantees that paper and wood
products carrying the FSC label come from environmentally and socially
responsible sources.
Credit Rating:
The current Bank Loan rating as assigned by the CARE is as under:-
Facility Rated Amount Rating
(Rs. in crores)
Long-term Bank Facilities 850 BBB-
Short-term Bank Facilities 150 A3
Total 1000
BBB-'' are judged to offer a moderate degree of safety regarding timely
servicing of financial obligations.
''A3'' indicates moderate degree of safety regarding timely payment of
financial obligations.
Dematerialization:
The Equity shares of the Company are in compulsory demat segment and
are available for trading in the depository system of both National
Securities Depository Ltd. (NSDL) and the Central Depository Services
(India) Ltd. (CDSL). 9,79,43,395 Equity Shares forming 98.96% of the
Equity Share capital of the Company stands dematerialized on 31st
March, 2014.
Listing of Shares:
The equity shares of the Company are presently listed on the BSE Ltd.
(BSE) and the National Stock Exchange of India Ltd. (NSE). The BSE &
NSE have nation wide terminals and therefore, shareholders/investors
are not facing any difficulty in trading in the shares of the Company
from any part of the Country.
The GDRs'' of the Company are listed on Euro MTF Market of Luxembourg
Stock Exchange.
Your Company has paid annual listing fees for financial year 2014-2015
to BSE and NSE. Annual maintenance and listing agency fee for the
calendar year 2014 has also been paid by the Company to Luxembourg
Stock Exchange, Luxembourg. Your Company has also paid custodial fees
to National Securities Depository Ltd. and Central Depository Services
(India) Ltd.
Statutory Auditors & Auditors'' Report:
M/s. Talati &Talati, had tendered their resignation pursuant to the
provisions of Section 140 of the Companies Act, 2013. The said casual
vacancy was filled by the appointment of M/s. P A R Y & Co., Chartered
Accountants as the Statutory Auditors of the Company by the Board of
Directors in its meeting held on 22nd May, 2014. They have conducted
the audit for the financial year 2013-14 and they shall hold office
till the conclusion of the ensuing Annual General Meeting and are
eligible for appointment.
The notes to the Accounts referred to in the Auditors'' Report of M/s. P
A R Y & Co., Chartered Accountants, Ahmedabad, are self explanatory and
therefore do not call for any further explanation under Section 134 of
the Companies Act, 2013.
Industrial Relations:
Industrial Relations remained cordial throughout the year under review.
Several industrial relation initiatives implemented by the Company have
significantly helped in improving the work culture, enhancing
productivity and enriching the quality of life of the workforce.
Appreciations and Acknowledgements:
Your Directors wish to place on record their appreciation for the
contribution made by the employees at all levels without whose hard
work, and support, your Company''s achievements would not have been
possible. Your Directors also wish to thank its customers, dealers,
agents, suppliers, investors and bankers for their continued support
and faith reposed in the Company.
FOR AND ON BEHALF OF BOARD OF DIRECTORS
PLACE : AHMEDABAD AJAY R. GOENKA
DATE : 12th AUGUST, 2014
CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2013
To, The Members of RAINBOW PAPERS LIMITED, AHMEDABAD
The Directors have great pleasure in presenting herewith the 27th
Annual Report together with the audited statements for the financial
year ended 31st March, 2013.
Financial Highlights:
The standalone and consolidated results of your company forthe
financial year ended on 31st March, 2013 are summarized herein below:
(Rs. in Lacs)
FINANCIAL RESULTS CONSOLIDATED STANDALONE
2012-13 2011-12 2012-13 2011-12
Revenue from Operations 91548.69 61077.64 54217.24 45987.62
Profit before
Exceptional, Extra
ordinary items,
Depreciation,
Interest & Tax 13647.56 10942.36 10675.78 9548.98
Depreciation 2662.32 2570.45 2662.31 2570.45
Profit before Interest &Tax 10985.24 8371.91 8013.47 6978.53
Interest 3669.75 2911.85 3276.29 2858.91
Profit before
Exceptional &
Extraordinary Items & Tax 7315.49 5460.06 4737.18 4119.62
Prior Period items /
Exceptional items 12.29 (3.76) 12.29 (3.76)
Taxation: Less/(Add)
Current Tax 948.28 864.15 947.80 851.73
MAT Credit Entitlement (748.17) (318.84) (748.16) (318.84)
Deferred Tax 1013.67 306.74 1013.67 306.74
NET PROFIT
AFTERTAX FORTHEYEAR 6114.00 4604.25 3536.16 3276.25
Add: Balance brought
forward 13244.31 9344.03 11931.69 9344.08
NETSURPLUS AVAILABLE
FOR APPROPRIATION 19358.31 13948.28 15467.85 12620.33
Capital Reserve on
Consolidation 15.33
Proposed Dividend/
Dividend Paid 418.87* 380.87 418.87* 380.87
Corporate Tax on Dividend 71.01 61.77 71.01 61.77
Transfer to General Reserve 270.00 246.00 270.00 246.00
Surplus carried forward
to Balance Sheet 18598.43 13244.31 14707.96 11931.69
EPS (Face Value ofRs.
2 per share)
Basic 6.46 5.14 3.74 3.66
Diluted 6.30 4.95 3.64 3.52
-includes Rs. 24 Lacs paid as dividend on conversion of 60,00,000
warrants into equity shares before record date in 2012 but after
approval of Annual accounts.
*Previous figures have regrouped/rearranged wherever necessary.
Dividend:
Based on Company''s performance, your Directors are pleased to recommend
a Dividend @ Rs. 0.40 per Equity Share (previous year Rs. 0.40 per Equity
Share) on the face value off 2/- each for the financial year 2012-13 on
9,87,17,300 equity shares of the Company. The dividend, if approved by
the members would involve a total cash outflow ofRs. 394.87 Lacs and the
dividend tax ofRs. 67.11 Lacs. Any new equity shares allotted on
conversion of warrants, if any before the record date shall also be
entitled for dividend and the total dividend amount may increase to
that extent.
Transfer to Reserves
A sum ofRs. 270 Lacs is proposed to be transferred to the
General Reserves out of the total amount available for appropriations.
An amount of Rs. 18598 Lacs is proposed to be retained in the statement
of profit and loss.
Share Capital
The Board of Directors at its meeting held on 20th December 2012 had
allotted 90,00,000 Convertible Warrants to one of the Promoters Group
Company at Rs. 81/- per warrant to be convertible into Equity shares
within a maximum period of 18 months from the date of allotment. Out of
the said 90,00,000 convertible warrants, 15,00,000 Warrants have been
opted for conversion into equity shares on March 30, 2013.
Review of Operations:
The brief highlights of the consolidated results of the Company during
the year are as under:
- Your company has achieved total production of
1,49,251.23 MT as compared to 1,39,596 MT in the previous year.
- Your company has recorded Gross Sales of Rs. 921.4 Crores as compared
to Rs. 613.3 Crores for FY12, a yoy growth of 50%.
- TheEBITDAforthef,nancialyear20l2-l3isRs.136.5 Crores compared to Rs.
109.4Crores last year, registering a growth of 25% yoy.
- The Net Profit is at Rs. 61.1 Crores compared to Rs. 46.1
Crores last year, a yoy growth of 33%.
Subsidiary Companies
Your company was having two wholly owned subsidiary companies viz.
Rainbow Papers JLT, Dubai and Rainbow Infrabuild Private Limited,
India. Both the Companies were engaged in trading of paper. The Board
of Directors in its Board meeting held on 9th May,20l3,has decided to
disinvest the equity share holding of the company in M/s. Rainbow
Infrabuild Pvt. Ltd. at fair market value as the company intends to set
up the Box Board Project in M/s. Rainbow Papers Ltd itself, instead of
the subsidiary.
In accordance with the general exemption granted by the Ministry of
Corporate Affairs, Government of India, the Balance Sheet, Statement of
Profit and Loss, Directors'' Report, Auditors'' Report etc. of the
subsidiary companies are not attached with the Annual Report of your
company.
The annual accounts of your Company''s subsidiaries as stated above and
the related information shall be made available to the shareholders of
the Company and its subsidiaries upon receipt of a request from them.
Such statements shall also be kept open for inspection at the
Registered Office of your Company and its subsidiaries during business
hours.
Capacity expansion:
The present production capacity of the Company is 3,05,000 MT per annum
which is utilized to manufacture among the existing product range
certain other value added products such as Copier paper,Maplitho,Glazed
paper, LWC, Coated
Paper etc.
Your company is further implementing ongoing expansion projects to
enhance the production capacityfrom 3,05,000
MTPAto 4,66,700 MTPA.Thesaid production capacity will be enhanced by
commissioning ofthe following projects:
a) Folding Duplex Board Project
Your Company has planned to install PM-9 Machine with a capacity of
132,000 MTPA at an approximate Cost ofRs. 480 Crores.The production from
the said machine shall be used in the packaging of cosmetics,
cigarettes, medicines, electrical appliances, etc. The plant is
expected to be commissioned by Financial Year 2015.
b) Mill Modernization and Production of Notebooks & Copier Paper
Existing PM4, PM5 and PM7 will be modernized to enhance the net
capacity by 29,700 MTPA. The Costs for the Modernization
isn50Crores.Themodernization project is expected to be completed by
financial year 2014. The company is making entry in value added
Consumer Products segment by manufacturing of Notebooks and Copier
Papers under"Rainbow"brand. The annual production capacity for
Notebooks will be 20,000 MTPA and for Copier Paper will be 7,500 MTPA.
"Zero Discharge" Strategy:
Along with backward integration, the Company hasalso"Zero Discharge"
strategy which not only improves operational efficiency but also
augments earning margins. The following are the major areas forming
part of this strategy:
- Efficient plant layout & different product mix allows better
utilization of raw-materials.
- Innovative ideas & approaches towards productive usage of
by-products.
The Company is manufacturing bricks out of the Fly ash generated as by
product of plant. The residual waste segregated from imported waste
paper is utilized for manufacturing laminated sheets.
Finance:
The Company was able to arrange finance at competitive rates inspite of
challenging market environment to meet its funds requirement for
expansion programme and working capital for day to day functioning.
During the year under review, the consortium bankers of the Company
have sanctioned additional term loan of Rs.369Croresforits ongoing
expansion programme.
As in the past, the Company maintained cordial relationships with its
bankers and was able to avail and negotiate favorable terms for various
banking facilities.
Exports:
Your Company exported 25,798.73 MT of paper during the
year under review.The export proceeds amounted to Rs. 9,245
Lacs (being 10.03%of Gross Sales) as compared toRs. 10,991 Lacs during
the previous year.
The main contributors for the satisfactory export performance were
increased focus on export market development and product quality that
matched the international standards.
With firm commitments and through sustained efforts, your Company
continues to maintain good rapport with global customers. Our quality
products and timely delivery have found wide acceptance in the highly
competitive international market.
Our products are being exported across the globe, to name a few among
them are Africa, Middle East, South East Asia, U.S.A., U.K., France,
Indonesia, Sri Lanka, Egypt and Bangladesh. With the clear aim and
determined focus, your Company looks forward to explore some more
untapped international markets.
Imports:
Your Company imported 62,602.30 MT of waste paper and 218.67 MT of
chemical during the year under review.
The imports amounted to Rs. 8047 Lacs of waste paper and Rs. 101 Lacs of
chemicals as compared to Rs. 7210 Lacs of waste paper and Rs. 129 Lacs of
chemicals respectively in the previous year.
Board of Directors:
Shri Kantibhai Patel and Shri Rahul Maheshwari, Directors of the
Company are due to retire by rotation at this Annual General Meeting
and being eligible offer themselves for re-appointment.
As stipulated under Clause 49 of the Listing Agreement with the Stock
Exchanges, brief piofileofthe Directors proposed to be re-appointed,
nature of their expertise specific functional areas, names of companies
in which they hold directorships and memberships/chairmanships of the
Board Committees and shareholding are provided in the Report on
Corporate Governance forming partofthe Annual Report.
Directors'' Responsibility Statement:
Pursuant to the requirements under Sub Section 2AA of Section 217of the
Companies Act, 1956,with respect to the Directors'' Responsibility
Statement, it is hereby confirmed:-
(1) that in the preparation of Annual Accounts, the applicable
Accounting Standards (AS) have been followed along with the proper
explanation relating to material departures, if any.
(2) thatthe Directors have selected such accounting policies and
applied them consistently and made judgement and estimates that are
reasonable and prudent so as to give true and fair view of the state of
affairs of the Company as at31*March,2013and ofthe Profitforthe year
ended on that date.
(3) thatthe Directorstothebestof their knowledge and ability have taken
proper and sufficient care for the maintenance of adequate accounting
records in accordance with the provisions of Companies Act,1956, for
safeguarding the assets of the Company and for preventing and detecting
fraud and other irregularities.
(4) thatthe Directors have prepared the Annual Accounts have been
prepared on a "going concern basis".
Audit Committee:
Pursuant to the provisions of Section 292A of the Companies Act, 1956,
the Board of Directors of the Company has constituted a committee of
Board of Directors as Audit Committee which now consists ofthe
following members:
1. Shri Shashikant N.Thakar: Chairman & Independent
Director
2. ShriRajendra Patawari : Independent Director
3. ShriKantibhaiPatel : Independent Director
Audit Committee has such powers and authority as provided under the
aforesaid provisions and acts in accordance with the terms of reference
specified in writing by the Board of Directors from time to time.
Fixed Deposits:
Your Company has not invited or accepted any fixed deposits from public
in terms of provisions of Section 58-A of the Companies Act, 1956read
with the Companies (Acceptance of Deposits) Rules, 1975and, as such, no
amount of principal or interest was outstanding as on the balance sheet
date.
Insurance:
The Company''s properties including Building, Plant and Machinery,
Stocks, Stores, etc., have been adequately insured. Global Depository
Receipts:
As on 31st March, 2013, total 2,86,39,725 number of GDRs are
outstanding for conversion.
Transfer of Unclaimed Dividend to Investor Education and Protection
Fund:
In terms of Section 205C of the Companies Act, 1956, the unclaimed
dividend aggregating to Rs. 2,04,609/- lying with the Company for a
period of seven years pertaining to the year ended on 31 "March, 2005,
was transferred during the year 2012-13, to the Investor Education and
Protection Fund established bythe Central Government.
Infrastructure:
The manufacturing facility of the Company is located approximately 40
kms from Ahmedabad, 350 kms from Mundra Port & 550 kms from Nhava Sheva
Port, thus offering good logistical advantage. It not only ensures
steady raw material supply of imported waste paper but also provides
easy access to global markets like Middle East and Africa, thus
providing a boost to its export business. Apart from this, the Company
also saves on freight cost within India which sometimes forms a major
portion of the total cost.
Besides, one of the critical inputs for paper production is
uninterrupted power supply. Disrupted power supply not only hampers
production but also impact client manufacturing process, thus affecting
the relationship. Hence in order to ensure quality power suppl y, your
Company has set up a 35MW captive power plant which is sufficient for
the total capacity of 4,66,700 MTPA
Awards and Accolades:
Your company has received the following awards during the year under
review:
- Two employees of our company - Mr.Tushar Patel and Mrs. Amitaben
Patel have been conferred with Shram Ratna Award 2012 by Labour
Ministry, Government of Gujarat.
¦ 272 Rank under the India''s fastest growing midsized companies by Inc.
India 500 for the year 2012 during the Fourth Inc. India 500 Awards.
¦ Emerging Corporate India in Manufacturing Sector by SMEChamberof
India.
¦ The Promoters of the Company ranked 261 as per Business World in its
rating "The Rich List 2013". We were ranked as 349 in 2012 for the
same.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings and Outgo:
The particulars as prescribed under section 217 [1] (e) of the
Companies Act, 1956 read with Rule 2 of the Companies [Disclosure of
particulars in the Report of Board of Directors) Rules, 1988 regarding
conservation of energy, technology absorption, foreign exchange
earnings and outgo are given in Annexure''A''forming partofthis Report.
Particulars of Employees:
The information required as per Sub- Section (2A) of Section 217 of the
Companies Act, 1956 read with Companies (Particulars of Employees)
Rules, 1975 as amended and forming part of the Directors'' Report for
the year ended 31* March, 2013 is enclosed and it is forming part of
the Report.
Corporate Governance:
The Company is committed to maintain the highest standards of Corporate
Governance and adhere to the Corporate Governance requirements set out
by SEBI. The
Company has also implemented several best Corporate Governance
practices as prevalent globally.
The Report on Corporate Governance as stipulated under
Clause 49 of the Listing Agreement forms part of the Annual Report.
A requisite certificate from the Statutory Auditors of the Company,
confirming compliance with the conditions of
Corporate Governance, as stipulated under clause 49, is attached to
this report.
Information Technology:
Most ofthe functional areas of your company are working on IT
(Information Technology) platform, to name a few:
Planning, Raw Material, Purchase, Finance, Sale, Weight Bridge,
Production, HR etc.
We are working with live ERP systems, modules and functions. Our
entire plant is under observation on CCTV cameras and PA System (Public
Announcements) for safety and security purpose.
Occupation, Health and Safety Policy:
The Company has in place Occupational Health & Safety Policy which
focuses on people, technology and facilities, supported by Management
commitment as the prime driver. A dedicated
Safety ManagementTeam is working towards the prevention of Man, Machine
and Material incidents at the corporate and manufacturing units level,
and towards education and motivation of the employees on various
aspects of Health, Safety and Environment through training programmes
and seminars. The Company holds certificates on Integrated Management
Systems of ISO 14001 (Environmental Management Systems) and BS OHSAS
18001 (Health and Safety).The Company recognizes its human force as the
most important asset and is deeply committed to providing a safe and
healthy working environment for its employees.
Corporate Social Responsibility:
During the year under review, the company had donated TV and Video CD
player for the purpose of education and effective communication to
Jhulasan, Vadu and RajpurGram Panchayats in Mehsana District which is
nearby to the factory premises for the benefit of children studying in
various schools inthe said area.
Further, the company had organized Blood Donation camp in
coordinationwithTerapanthSevaSamiteeandmorethan 100 bottles was
donated. The company has also conducted free medical checkup camps for
the natives in the nearby vicinity.
Your Company celebrated various festivals like Ganesh Mahotsav,
Independence Day etc. wherein awards were given to the Workers of the
Company for encouraging productivity and efficiency at Factory and
create harmonious industrial relations, sense of unity and brotherhood
among local residents staying in surrounding area.
Your company has also made representation to the State authorities and
the work for broadening of the road from Rajpur to Jhulasan has been
approved bythe Government, which will ease out the local dwellers and
school authorities hardships and facilitate smooth transportation and
create accident free area by placing the Traffic Boards forthe safety
and security of school going children as well as general public at
large in the said area.
Quality Initiatives:
We continue our journey of delivering value to our clients through
significant investments in quality programs. We have adopted several
external benchmarks and certifications. Your Company is certified under
various standards to meet clients'' requirements and enhancing valuable
delivery.
Accreditations & Certifications:
Your Company continues to holdthe following:
a) ISO 9001 /IS014001 Accreditation
Your Companys Quality Management Systems continue to be covered by the
"ISO 9001" accreditation. Company''s Environmental Management System
continues to enjoy"IS01400 V accreditation.
b) OHSAS18001 Certification
Your Company continues to enjoy certification under Occupational Health
and Safety Assessment Series 18001 (OHSAS) which is an International
Standard which facilitates management of Occupational Health and Safety
risks associated with the business of the organization.
c) Star Export House
Your Company is recognized and awarded as "Star Export House" by
Director General of Foreign Trade, New Delhi.
d) Forest Stewardship Council (FSC) Certification
Scientific Certification Systems (SCS), who is accredited by the FSC,
has awarded to your Company, the Forest Stewardship Council (FSC)
Certification, valid till May, 2015.FSC is an international
certification and labeling system that guarantees that paper and wood
products carrying the FSC label come form environmentally and socially
responsible sources.
Credit Rating:
The current Bank Loan rating as assigned by the CRISIL is as under-
Facility Rated Amount Rating
(Rs.in lacs)
Cash Credit 11105 BBB /Negative
Term Loan 85345 BBB /Negative
LC & Bank Guarantee 7650 A2
Total 104100
''A2'' indicates strong degree of safety regarding timely payment of
financialob''igations and there is low credit risk.
''BBB ''are judged to offer a moderate safety with regard to timely
payment offinancial obligationsforthe present.
Cost Auditors:
As perthe Companies (Cost Accounting Records) Rules 2011, the Company
filed the Cost Audit Report along with Cost Compliance Report for the
financial year 2011-12 in XBRL format.
The board of directors, subject to the approval of the Central
Government, re-appointed Mr. V.H. Shah, Cost Accountant, as a Cost
Auditor for conducting the Cost Audit for the financial year 2013-14.
The audit committee of directors recommended hisre-appointment.
The Company has also received a letter form the Cost Auditor, stating
that the appointment, if made, will be within limits prescribed under
Section 224(1B) of the Companies Act, 1956
Dematerialization:
The Equity shares of the Company are in compulsory demat segment and
are available for trading in the depository system of both National
Securities Depository Ltd (NSDL) and the Central Depository Services
(India) Ltd. (CDSL). 9,76,69,395 nos. of equity shares forming 98.94%
of the equity share capital of the Company stands dematerialized on
31st March, 2013.
Listing of Shares:
The equity shares of the Company are presently listed on the BSE Ltd.
and the National Stock Exchange of India Limited (NSE). The BSE & NSE
have nation wide terminals and therefore,shareholders/investorsare not
facing any difficulty in trading in the shares of the Company from any
part of the Country.
The GDRs'' of the Company are listed on Euro MTF Market of Luxembourg
Stock Exchange
Your Company has paid annual listing fees for financial year
2013-2014toBSEand NSEAnnual maintenance and listing agency fee for the
calendar year 2013 has been paid by the Companyto Luxembourg Stock
Exchange, Luxembourg. Your Company has also paid custodial fees to
National Securities Depository Ltd. and Central Depository Services
(India) Ltd.
Statutory Auditors:
M/s.Talati&Talati,Chartered Accountants, Statutory Auditors of the
Company, hold office until the conclusion of the ensuing Annual General
Meeting and are eligible for reappointment.
The Company has received a letter from the Auditors to the effect that
their reappointment, if made, would be within the prescribed limits
under Section 224(1 B) of the Companies Act, 1956and that they are not
disqualified for reappointment within the meaning of Section 226 of the
said Act.
Auditors'' Report:
The notes to the Accounts referred to in the Auditors'' Report of
M/s.Talati &Talati, Chartered Accountants, Ahmedabad, are self
explanatory and therefore do not call for any further explanation under
Section 217(3) of the Companies Act, 1956.
Industrial Relations:
Industrial Relations remained cordial throughout the year under review.
Several industrial relation Initiatives implemented by the Company have
significantly helped in improving the work culture, enhancing
productivity and enriching the quality of life of the workforce.
Appreciations and Acknowledgements:
Your directors wish to express their sincere appreciation of the
valuable support and guidance provided by the Stock
Exchanges and other Regulatory bodies.
Your Directors also take this opportunity to acknowledge the continued
assistance and co-operation received from
Banks, Government Agencies and the Shareholders.
Your Directors also wish to place on record their appreciation for the
valuable services rendered and the commitment displayed by the
employees of the Company and look forward to their continued support in
the future as well.
FOR AND ON BEHALF OF BOARD OF DIRECTORS
PLACE : AHMEDABAD AJAY R. GOENKA
DATE : 9th MAY, 2013 CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2012
To, The Members of RAINBOW PAPERS LIMITED,
The Directors have great pleasure in presenting herewith the 26th
Annual Report together with the audited statements for the financial
year ended 31st March, 2012.
Financial Highlights:
The standalone and consolidated results of your company for the
financial year ended on 31st March, 2012 are summarized herein below:
(Rs. In Lacs)
FINANCIAL RESULTS CONSOLIDATED STANDALONE
2011-12* 2011-12 2010-11
Revenue from Operations 61078 45988 39572
Profit before Exceptional,
Extraordinary Item &
Depreciation, Interest & Tax 10888 9495 9089
Depreciation 2570 2570 2780
Profit before Interest & Tax 8318 6925 6309
Interest 2858 2805 1759
Profit before Exceptional &
Extraordinary Items & Tax 5460 4120 4550
Prior Period Items /
Exceptional Items (4) (4) (6)
Taxation: Less/
(Add) Current Tax 864 852 930
MAT Credit Entitlement (319) (319) (756)
Deferred Tax 307 307 660
NET PROFIT AFTER TAX FOR THE
YEAR 4604 3276 3710
Add: Balance brought forward 9344 9344 6340
NET SURPLUS AVAILABLE FOR
APPROPRIATION 13948 12620 10050
Capital Reserve on Consolidation 15 - -
Proposed Dividend /
Dividend paid 381 381 349
Corporate Tax on Dividend 62 62 57
Transfer to General Reserve 246 246 300
Surplus carried forward to
Balance Sheet 13244 11931 9344
EPS (Face Value of Rs. 2
per share)
Basic 5.14 3.66 4.25
Diluted 4.95 3.52 4.25
* Two wholly owned subsidiaries viz 1. Rainbow Papers JLT, Dubai 2.
Rainbow Infrabuild Private Limited, India, incorporated in F.Y. 2011-12
only, therefore previous year consolidated figures are not given.
Dividend:
Your Directors are pleased to recommend a Dividend @ Rs. 0.40 per Equity
Share (previous year 10.40 per Equity Share) on the face value of Rs.2/-
each for the financial year 2011-12. The payment of the aforesaid
dividend is subject to approval of the members at the 26th Annual
General Meeting of the Company and shall be paid to those members whose
names appear in the Register of Members on 21st September, 2012, being
the record date and in respect of Equity Shares held in dematerialized
form, it will be paid to the members whose names are furnished by
National Securities Depository Limited and Central Depository Services
(India) Limited, as beneficial owners as on 21st September, 2012.
The total dividend payout for the financial year 2011-12 is of Rs.442.66
Lacs (previous year: Rs.405.47 Lacs) including dividend distribution tax
of Rs.161.79 Lacs (previous year: Rs.56.60 Lacs).
Transfer to Reserves
Your Company proposes to transfer a sum of Rs.246 Lacs to the General
Reserves out of the total amount available for appropriations. An
amount of 113244 Lacs is proposed to be retained in the statement of
Profit and Loss.
Share Capital
During the year under review your company has made allotment of
40,00,000 equity shares of Rs.2/- each at Rs. 61/- per share and 60,00,000
convertible warrants of Rs.61/- each convertible into 60,00,000 equity
shares of Rs.2/- each (convertible within a period of 18 months).
Review of Operations:
The brief highlights of operations of the Company during the year areas
under:
-The Company has achieved total production of 1,39,596 MT as compared
to 1,37,497 MT in the previous year. d The Company has recorded total
revenue from operations of Rs.61078 lacs (including trading turnover of
Rs. 16088 lacs) as compared to Rs.39572 lacs in the previous year, showing
an year on year a growth of 54.35 % in the sales turnover. d The Company
has earned Profit after Tax of Rs. 4604 lacs compared to Rs. 3710 lacs in
the previous financial year recording an increase of 24.09%.
- The net worth of the Company was recorded to be Rs. 33009 lacs as on
31st March, 2012 in comparison to the net worth in the previous financial
year of 128501 lacs. d The Company has earned EBIDTA margin of Rs.10888
lacs as compared to Rs.9089 lacs in the previous year.
Subsidiary Companies:
During the year under review, your company has incorporated two wholly
owned subsidiary companies under the name of M/s Rainbow Papers JLT,
Dubai and M/s Rainbow Infrabuild Private Limited, India.
Rainbow Papers JLT, Dubai has started trading business of paper and
recycled waste paper whereas Rainbow Infrabuild Private Limited, India
is engaged in trading of paper.
In accordance with the general exemption granted by the Ministry of
Corporate Affairs, Government of India, the Balance Sheet, Statement of
Profit and Loss, Directors' Report, Auditors' Report etc. of the
subsidiary companies are not attached with this Annual Report of your
company.
The annual accounts of your Company's subsidiaries as stated above and
the related information shall be made available to shareholders of your
Company and its subsidiaries upon receipt of a request from them. They
will also be kept open for inspection at the Registered Office of your
Company and its subsidiaries during business hours.
Capacity expansion:
The present production capacity of the Company is 3,05,000 MTPA which
is utilized to manufacture among the existing product range certain
other value added products such as Copier paper, Maplitho, Glazed
paper, LWC, Coated Paper etc.
Your company is further proposing to enhance the production capacity
from 3,05,000 MTPA to 4,66,700 MTPA. The said production capacity will
be enhanced by installing following proposed projects:
a) Folding Duplex Board with production capacity of 132,000 MTPA
Your company is planning to install a new machine to manufacture
folding duplex board with a capacity 1,32,000 MTPA. The total Cost of
the Project is Rs. 480 Crores out of which debt portion is approximately
Rs.294 Crores and balance to be funded from Internal Accruals and Fresh
Equity infusion. The said new product will enable the company to cater
to high margin packaging segment used for packaging of cosmetics,
cigarettes, medicines, electrical appliances & products, etc
b) Mill Modernization with production capacity of 29,700 MTPA
Some of the existing paper machines of the company will be modernized
to enhance the net production capacity by 29,700 MTPA. The estimated
Project Cost for the said project is t 150 Crores out of which debt
portion is approximately Rs.75 Crores and balance to be funded from
Internal Accruals and Fresh Equity infusion. The Mill modernization
project will not only increase the production capacity but also
improve the quality of products of the Company.
c) Production of Notebooks & Copier Paper
The company is also planning to make its entry in value added Consumer
products segment by manufacturing of Notebooks and Copier paper
under the brand name of "Rainbow".
Out of the total production capacity of 4,66,700 MTPA, notebooks and
copier paper will contribute 20,000 MTPA and 7,500 MTPA respectively.
The company is planning to penetrate, through building distributorship
network initially in states of Gujarat, Maharashtra & Rajasthan. The
company is currently evaluating market potential.
Finance:
During the year under review, the Company has serviced all its debt
payment and interest obligations on the respective due dates. In order
to meet the proposed cost of expansion programme, your company has
approached the consortium bankers for funding its project of setting up
of folding duplex board and mill modernization with a total project
cost of Rs. 630 Crores wherein total debt portion will be around Rs. 369
Crores and balance through Internal Accruals and Fresh Equity infusion.
The proposal is under active consideration with the bankers and
financial closure shall be concluded shortly.
Exports:
Your Company exported 30,302 MT of paper during the year under review.
The exports accounted to 17.92% of gross sales. The exports proceeds
amounted to Rs. 10,991 Lacs as compared to Rs. 10,488 Lacs during the
previous year.
Your Company was honored with the special award in recognition of its
outstanding export performance in respect of paper and paper board for
the year 2010-11 by CAPEXIL. This award has been received by the
Company for the 3rd consecutive year.
Your Company has been awarded as the 3rd Highest Exporter at
ICD-Sabarmati by M/s. Container Corporation of India Ltd. for the year
2010-11.
With firm commitments and through sustained efforts, your Company
continues to maintain good rapport with global customers. Our quality
products and timely delivery have found wide acceptance in the highly
competitive international market.
Our products are being exported across the globe. During the year, your
Company has successfully exported its products to various countries
such as Africa, Middle East, South East Asia, U.S.A., U.K., France,
Indonesia, Sri Lanka, Egypt and Bangladesh. With the Company's clear
aim and determined focus, your Company looks forward to explore more
untapped markets such as Mauritius, Philippines and Latin America.
Imports:
Your Company imported 54,278 MT of waste paper and 231.2 MT of chemical
during the year under review. Your Company has been awarded as 1st
largest importer at ICD, Ahmedabad by "Container Corporation of India
Ltd" for year 2010-11 for the 3rd consecutive year.
The imports amounted to Rs. 7210 Lacs of waste paper and Rs. 129 Lacs of
chemicals as compared to Rs. 8939 Lacs of waste paper and Rs. 259 Lacs of
chemicals respectively in the previous year.
Directors:
During the year under review, Shri Bhaskar Bhatt and Shri Manish
Bagadia resigned from the board w.e.f 5th October, 2011 and 30th
August, 2011 respectively. The board places on record appreciation for
the services rendered by them as directors of the company.
Shri Shashikant N. Thakar, Director is liable to retire by rotation
under Article No. 150 of Articles of Association of the Company and
being eligible offers himself for reappointment.
Directors' Responsibility Statement:
Pursuant to the requirements under Sub Section 2AA of Section 217 of
the Companies Act, 1956, with respect to the Directors' Responsibility
Statement, it is hereby confirmed:-
(1) that in the preparation of Annual Accounts, the applicable
accounting standards have been followed along with the proper
explanation relating to material departures, if any.
(2) that the Directors have selected such accounting policies and
applied them consistently and made judgement and estimates that are
reasonable and prudent so as to give true and fair view of the state of
affairs of the Company as at 31st March, 2012 and of the Profit for the
year ended on that date.
(3) that the Directors to the best of their knowledge and ability have
taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Companies
Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities.
(4) that the Directors have prepared the Annual Accounts on a
"going concern basis".
Audit Committee:
Pursuant to the provisions of Section 292A of the Companies Act, 1956,
the Board of Directors of the Company has constituted a committee of
Board of Directors as Audit Committee consisting of the following
members:
Shri Shashikant N. Thakar :Chairman &
Independent Director
Shri Rajendra Patawari independent Director
Shri Bhasker Bhatt
(upto05.10.2011) independent Director Shri Kantibhai Patel
(w.e.f 12.11.2011) independent Director
Audit Committee has such powers and authority as provided under the
aforesaid provisions and acts in accordance with the terms of reference
specified in writing by the Board of Directors from time to time.
Fixed Deposits:
Your Company has not invited or accepted any fixed deposits from public
in terms of provisions of Section 58-A of the Companies Act, 1956 read
with the Companies (Acceptance of Deposits) Rules, 1975 and, as such,
no amount of principal or interest was outstanding as on the balance
sheet date.
Insurance:
The Company's properties including Building, Plant and Machinery,
Stocks, Stores, etc., have been adequately insured.
Global Depository Receipts:
As on 31st March, 2012, total 2,88,89,725 number of GDRs are
outstanding for conversion.
Transfer to Investor Education and Protection Fund:
Your Company sends letters to all shareholders whose dividends are
unclaimed so as to ensure that they receive their rightful dues.
Efforts are also made in co-ordination with the Registrar to locate the
shareholders who have not claimed their dues.
During the year under review, pursuant to provisions of Section 205C(2)
of the Companies Act, 1956, your Company has transferred a sum of Rs.
73,506/- for the financial year 2003-04 to Investor Education and
Protection Fund, which was due & payable and has remained unclaimed and
unpaid for a period of seven years, after sending reminder letters to
such shareholders.
Infrastructure:
Your Company is well equipped with latest infrastructure and plant and
machinery as required for smooth and efficient running of the plant.
The plant is located at Village: Rajpur at a distance of approximately
500 mtrs from the State Highway and has access to the latest
infrastructure facilities such as developed roads, power supply, water,
availability of labour- skilled & semi skilled. Your company is also
having adequate land which is sufficient for the existing plant as well
as for the future expansions.
Your Company has installed three tube wells within the plant which
caters to overall requirement of water. Further, Narmada Canal is also
passing nearby the factory site. Necessary application has been made by
the company to avail the water supply and approval of the same is
awaited.
Awards and Accolades:
Your company has received the following awards during the year under
review:
- Your Company has been awarded as the 1st Highest Importer for the 3rd
consecutive year at ICD-Sabarmati by M/s. Container Corporation of
India Ltd. for the year 2010-11.
- Your Company has been awarded as the 3rd Highest Exporter at
ICD-Sabarmati by M/s. Container Corporation of India Ltd. for the year
2010-11.
- Your Company has also received the Special Award in recognition of
its outstanding export performance in respect of Paper and Paper Board
by CAPEXIL for the third consecutive year.
- Your Company has been upgraded by the Dalai Street from Small Cap to
Mid Cap and Rainbow has been ranked as 208th among top400 Mid Cap
Companies in India.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings and Outgo:
The particulars as prescribed under section 217 [1] (e) of the
Companies Act, 1956 read with Rule 2 of the Companies [Disclosure of
particulars in the Report of Board of Directors) Rules, 1988 regarding
conservation of energy, technology absorption, foreign exchange
earnings and outgo are given in Annexure 'A' forming part of this
Report.
Particulars of Employees:
The information required as per Sub-Section (2A) of Section 217 of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975 as amended and forming part of the Directors' Report for
the year ended 31st March, 2012 is enclosed and it is forming part of
the balance sheet.
Corporate Governance:
The Company is committed to maintain the highest standards of Corporate
Governance.
Your Company continues to comply with the requirements enshrined in
clause 49 of the Listing Agreement which relates to Corporate
Governance.
A Report on Corporate Governance as stipulated under clause 49 of the
Listing Agreement forms part of the Annual Report. A certificate from
the Statutory Auditors of the Company, confirming compliance with the
conditions of Corporate Governance, forms part of this report.
Information Technology:
Most of the functional areas of your company are working on IT
(Information Technology) platform, to name a few: Planning, Raw
Material, Purchase, Finance, Sale, Weight Bridge, Production, HR etc.
Our entire plant is under observation on CCTV cameras and PA System
(Public Announcements) for safety and security purpose.
Health, Safety, Security and Environment:
Rainbow Papers Limited has always been emphasizing for achieving better
environmental conditions at work place. From time to time various
initiatives have been undertaken such as plantation, installation of
latest technological equipments to reduce waste generation and to
recycle and reuse the waste materials to the maximum possible extent.
The mill development programme undertaken by the Company is an
extension of your Company's commitment to further better our
environment.
The Company takes pride in providing a healthy and safe operating
environment for its employees. It is a recycled based paper unit which
uses the waste paper as raw material for manufacturing its finished
product. Thus, saving the forests which is already in scarcity.
Constant efforts are made to conserve natural resources. During the
year, the Company was able to further reduce its energy and water
consumption per unit by installing new energy meters. The Company
deploys eco-friendly technology to provide a safe and clean environment
in its neighborhood. It has installed efficient Effluent Treatment
Plants in order to protect the environment. Adequate measures are also
taken for the safety of the workmen working at the plant by providing
them helmets, safety belts etc.
Corporate Social Responsibility:
Corporate Social Responsibility (CSR) continues to assume an important
role in the activities of the Company. It encompasses much more than
social outreach programs and is an integral part of the way the Company
conducts its business. RPL, has generously donated having object for
the social up liftment of the economically backward people.
The Company is also making bye-products out of its recycled activities
by making Waste Fiber Sheets (WFS) used in various applications such as
packing material , roofing, waste baskets and flower pots and Fly Ash
Bricks of suitable strength and quality accepted and well acclaimed in
the Civil Works. The Company is also making presentation to government
authorities for better infrastructural facilities in the areas in the
vicinity of Company's works / factory.
The Company has set up a new division under the name of "Rainbow
Institute of Technology & Research" (RITR), for imparting training
relating to paper and power projects.
The said institution is having motto of providing skilled training for
technical up gradation for the ITI, Diploma and Degree Engineering
students to enhance their ability and shop floor level skill
development. This will be the value addition in their scope of work and
provide employment opportunity at considerable higher remuneration in
the competitive field. The Company envisages starting the activities of
the same probably by end of December2012.
Quality:
In today's global competition and open economy, quality plays a vital
role in marketing the products and stay ahead of others. Therefore,
great emphasis is given to manufacturing products that meet high
standards of quality in the global market and customer satisfaction.
Proactive efforts are directed towards determining customers'
requirements and achieving all-round customer satisfaction. This is
primarily achieved through automated systems (reducing manual handling
to minimum), high attention to complaint resolution, online
communication and information exchange, quality circles etc.
Your Company has installed latest Quality plus System which ensures and
controls the Quality of its product.
Certifications:
Your Company holds various accreditation as under:
a) ISO9001/ISO 14001 Accreditation
Your Company's Quality Management Systems continue to be covered by the
"ISO 9001 " accreditation. Company's Environmental Management System
continues to enjoy "ISO 14001" accreditation.
b) OHSAS18001 Certification
Your Company continues to enjoy certification under Occupational Health
and Safety Assessment Series 18001 (OHSAS) which is an International
Standard which facilitates management of Occupational Health and Safety
risks associated with the business of the organization.
c) Star Export House
Your company is recognized and awarded as "Star Export House" by
Director General of Foreign Trade, New Delhi.
d) FSC-COC certification
Your Company has been accredited with FSC- COC certification (Forest
Stewardship Council-Chain of Custody).
Credit Rating:
The current Bank Loan rating as assigned by the CRISIL is as under:-
Facility Rated Rating
Amount
(Rs. in lacs)
Cash Credit 11105 BBB /Stable
Term Loan 31369 BBB /Stable
LC&Bank Guarantee 7650 P2
Total 50124
'P2' indicates that the degree of safety regarding timely payment on
the instrument is strong.
'BBB ' are judged to offera moderate safety with regard to timely
payment of financial obligations for the present.
Cost Auditors:
Pursuant to Section 233-Bof the Companies Act, 1956, the Central
Government has mandated the Cost Audit of cost accounts relating to
Paper every year. Shri V.H. Shah, Cost Accountant, Ahmedabad has been
appointed as Cost Auditor for the year 2012-13. The Cost Audit Report
for the year 2011-12 will be submitted to the Central Government before
the due date.
Dematerialization:
The shares of the Company are in compulsory demat segment and are
available for trading in the depository system of both National
Securities Depository Ltd (NSDL) and the Central Depository Services
(India) Ltd (CDSL). As on 31st March 2012, 9,01,43,395 nos. of equity
shares forming 98.82% of the equity share capital of the Company
stands dematerialized.
Listing of Shares:
The equity shares of the Company are presently listed on the Bombay
Stock Exchange Limited, (BSE) and National Stock Exchange of India
Limited (NSE). The BSE & NSE have nation wide terminals and therefore,
shareholders/investors are not facing any difficulty in trading in the
shares of the Company from any part of the Country.
The GDR of the Company are listed on Euro MTF Market of Luxembourg
Stock Exchange
Your Company has paid annual listing fees for financial year 2012-2013
to BSE and NSE. Annual maintenance and listing agency fee for the
calendar year 2012 has been paid by the Company to Luxembourg Stock
Exchange, Luxembourg. Your Company has also paid custodial fees to
National Securities Depository Ltd. and Central Depository Services
(India) Ltd.
Statutory Auditors:
The Auditors, M/s. Talati & Talati, Chartered Accountants, Ahmedabad,
hold office until the conclusion of the ensuing Annual General Meeting
and are recommended for re- appointment. A Certificate from the
Auditors has been received to the effect that their re- appointment, if
made, would be within the limits prescribed under Section 224(1B) of
the Companies Act, 1956.
Auditor's Report:
The notes to the Accounts referred to in the Auditors' Report of M/s.
Talati & Talati, Chartered Accountants, Ahmedabad, are self explanatory
and therefore do not call for any further explanation under Section 217
(3) of the Companies Act, 1956.
Industrial Relations:
Industrial Relations remained cordial throughout the year under review.
Several industrial relation initiatives implemented by the Company have
significantly helped in improving the work culture, enhancing
productivity and enriching the quality of life of the workforce.
Appreciations and Acknowledgements:
Your directors wish to place on record their deep appreciation for the
contribution made by employees at all levels without whose hard work,
solidarity and support, your Company's achievements would not have been
possible. Your Directors also wish to thank its customers, dealers,
agents, suppliers, investors and bankers for their continued support
and faith reposed in the company.
FOR AND ON BEHALF OF BOARD OF DIRECTORS
PLACE: AHMEDABAD AJAY R. GOENKA
DATE : 24th MAY, 2012 CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2011
The Members,
RAINBOW PAPERS LIMITED,
AHMEDABAD
The Directors have great pleasure in presenting herewith the 25th
Annual Report together with the audited financial statements for the
financial year ended 31st March, 2011.
Financial Highlights:
Your company's performance for the financial year 2010-11 is summarized
below:
(Rs. In Lacs)
FINANCIAL RESULTS 2010-11 2009-10
Gross Turnover 40173 29281
Profit before Depreciation, Interest & Tax 8916 6844
Depreciation 2780 2403
Profit before Interest & Tax 6135 4441
Interest 1585 1327
Profit before Tax 4550 3114
Taxation: Less/ (Add) Current Tax 930 528
MAT Credit Entitlement (756) (186)
Deferred Tax 660 413
NET PROFIT AFTER TAX 3716 2359
Less : Excess / Short Provision & Prior
Period adjustments (6) 4
BALANCE PROFIT FOR THE YEAR 3710 2363
Add: Balance brought forward 6339 4583
NET SURPLUS AVAILABLE FOR APPROPRIATION 10050 6946
Proposed Dividend 349 349
Corporate Tax on Dividend 57 58
Transfer to General Reserve 300 200
Surplus carried forward to Balance Sheet 9344 6339
EPS 4.25 5.27
(Restated)
Dividend:
Your Directors are pleased to recommend a Dividend @ Rs. 0.40 per
Equity Share (on the face value of Rs. 2/-each) for the financial year
2010-11. The payment of the aforesaid dividend is subject to approval
of the members at the 25th Annual General Meeting of the Company and
shall be paid to those members whose names appear in the Register of
Members on 21st September, 2011, being the record date and in respect
of Equity Shares held in dematerialized form, it will be paid to the
members whose names are furnished by National Securities Depository
Limited and Central Depository Services (India) Limited, as beneficial
owners as on 21st September, 2011.
The total dividend payout for the financial year 2010-11 is of Rs.
348.87 Lacs (previous year: Rs. 348.87 Lacs) including dividend
distribution tax of Rs. 56.60 Lacs (previous year: 57.94 Lacs).
Share Capital:
Your Company had taken approval of the members at an Extra Ordinary
General Meeting held on 20th April, 2011, for the allotment of
40,00,000 Equity Shares of Rs. 2/- each at a premium of Rs. 58/- per
share and 60,00,000 Convertible warrants convertible in to 60,00,000
Equity Shares of Rs. 2/- each at a premium of Rs. 58/- per share
(convertible within a period of 18 months). The allotment of the said
Equity Shares and Convertible Warrants could not be completed on
account of pending approvals from the Regulatory Authorities.
Review of Operations:
During the year under review, your Company had achieved highest
production in the history of the Company with better efficiency. This
could be achieved on account of full operation of PM 7 imported from
Germany with production capacity of 250 MT per day, rebuilding of other
paper machines and installation of various balancing equipments.
The brief highlights of operations of the Company during the year are
as under:
- The Company has achieved total production of 1,37,497 MT as compared
to 1,09,055 MT in the previous year.
- The Company has recorded total turnover of Rs. 40173 lacs as compared
to Rs. 29281 lacs in the previous year, recording a growth of 37% in
the sales turnover.
- The Company has earned Profit after Tax of Rs. 3716 lacs compared to
Rs. 2359 lacs in the previous financial year recording an increase of
58%.
- The net worth of the Company was recorded to be Rs. 28501 lacs as on
31st March, 2011 in comparison to the net worth in the previous
financial year of Rs. 22181 lacs.
- The Company has earned EBIDTA margin of Rs. 8916 lacs as compared to
Rs. 6844 lacs in the previous year.
Finance:
During the year under review, the Company has serviced all its debt
payment and interest obligations on the respective due dates. In order
to meet the cost of expansion programme, the Company had taken a Term
Loan of Rs. 20,000 lacs, which was sanctioned by the consortium of
eight banks and out of which Rs. 16,270 lacs has been disbursed and
utilized by the Company upto 31st March, 2011, for its expansion
project.
Exports:
Your Company exported36,409 MT of paper during the year under review as
compared to 22,033 MT in the previous year. The exports accounted to
26.68% of gross sales. The exports proceeds amounted to Rs. 10,488 Lacs
as compared to Rs. 5,392 Lacs during the previous year.
Your Company was honoured with the special award in recognition of its
outstanding export performance in respect of paper and paper board for
the year 2009-10 by CAPEXIL. This award has been received by the
Company for the 2nd consecutive year.
With firm commitments and through sustained efforts, your Company
continues to maintain good rapport with global customers. Our quality
products and timely delivery have found wide acceptance in the highly
competitive international market.
Our products are being exported across the globe. During the year, your
Company has successfully exported its products in to various countries
such as Africa, Middle East, South East Asia, U.S.A., U.K., France,
Indonesia, Sri Lanka, Egypt and Bangladesh. With the Company's clear
aim and determined focus, your Company looks forward to explore more
untapped markets such as Mauritius, Philippines and Latin America.
Imports:
Your Company imported 76,585 MT of waste paper and 556 MT of chemical
during the year under review as compared to 74,325 M.T. of waste paper
and 522 M.T. of chemical respectively in the previous financial year.
Your Company has been awarded as 1st largest importer at ICD, Ahmedabad
by "Container Corporation of India Ltd" for year 2010-11 for the third
consecutive year.
The imports amounted to Rs. 8,939 Lacs of waste paper and Rs. 259 Lacs
of chemicals as compared to Rs 7,143 Lacs of waste paper and Rs. 224
Lacs of chemicals respectively in the previous year.
Expansion Programme:
Your Company has taken up the expansion programme from time to time.
The current expansion programme pertaining to installation of paper
plant imported from Germany, is presently under the final stages of
completion. The total project cost for the said expansion programme was
Rs. 32,700 Lacs. The entire project cost included the cost of
installation of the plant already imported from Germany with production
capacity of 1,22,000 MT p.a., along with its technological upgradation,
installation of 20MW power plant, deinking plant, pulp mill etc.
The paper manufacturing plant i.e. PM8 would commence full fledged
production by October, 2011.
The said new plant shall be utilized for manufacturing of various value
added products like thermal paper, non carbon paper, glazed newsprint,
light weight paper etc. Post commissioning of the plant, the production
capacity of the Company would enhance from present 1,85,000 MT per
annum to 3,05,000 MT per annum. With the completion of the said
expansion, your Company would be the sixth largest paper Company in
terms of its installed capacity.
Your Company obtained the terms of reference from the Government of
India for the installation of power plant of 20 MW in the month of
January, 2011. Thereafter, your Company placed order for installation
of turbine from M/s. Cethar Vessels Limited and boiler from M/s.
Triveni Engineering Limited. The Power plant is expected to commission
by March, 2012.
Wealth out of waste project:
Your Company had also taken up wealth out of waste projects, which
included installation of the following:
a. Brick manufacturing plant:
The fly ash generated as by-product of power plant shall be utilized
for manufacturing bricks. The brick making machine has already been
installed at the plant with an installed capacity of 200 lacs bricks
per annum. The said plant has already commenced full fledged
production.
Future Outlook :
Your directors have planned to enter the consumer segment by launching
value added consumer products such as note books, copier papers, office
stationery under the brand "Rainbow". This would involve total capital
outlay of Rs. 2,500 lacs , which shall be sourced from internal
accruals. The Company is initially planning to penetrate through
building distributorship network in the states of Gujarat, Rajasthan
and Maharashtra. The branding exercise shall commence by 3rdquarterof
FY 2011-12.
b. Plastic sheet manufacturing plant:
The plastic contents segregated at the time of processing from the
waste paper shall be utilized by the Company for manufacturing of plain
and corrugated plastic sheets and other related items.
The plastic sheet plant has the capacity of manufacturing 1,80,000
sheets per annum. The trial production has already begun.
The Company is also evaluating options for
- waste paper collection facility in Singapore, Canada, Dubai
- Acquisition of pulping capacity in high pulp producing countries.
- Setting up folding duplex board plant in India.
- Joint venture with local partner for sourcing and marketing in
African Country.
- Widening its presence in International Market.
Directors:
During the year under review, Shri Kantibhai Patel and Shri Manish
Bagadia were appointed as Additional Directors on the Board of the
Company with effect from 12th August, 2010 and 1st September, 2010
respectively. They hold office up to the ensuing Annual General Meeting
of the company.
Your Directors extend a warm welcome to the new Directors on the Board
of the Company.
Shri Rajendra Patawari, Director is liable to retire by rotation under
Article No. 150 of Articles of Association of the Company and being
eligible offers himself for reappointment.
Directors' Responsibility Statement:
Pursuant to the requirements under Sub Section 2AA of Section 217 of
the Companies Act, 1956, with respect to the Directors' Responsibility
Statement, it is hereby confirmed:-
(1) that in the preparation of Annual Accounts, the applicable
accounting standards have been followed along with the proper
explanation relating to material departures, if any.
(2) that the Directors have selected such accounting policies and
applied them consistently and made judgement and estimates that are
reasonable and prudent so as to give true and fair view of the state of
affairs of the Company as at 31st March, 2011 and of the Profit for the
year ended on that date.
(3) that the Directors to the best of their knowledge and ability have
taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of Companies Act,
1956, for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities.
(4) that the Directors have prepared the Annual Accounts on a "going
concern basis".
Audit Committee:
Pursuant to the provisions of Section 292A of the Companies Act, 1956,
the Board of Directors of the Company has constituted a committee of
Board of Directors as Audit Committee consisting of the following
members:
1. Shri Shashikant Thakar : Chairman
2. Shri Rajendra Patawari : Independent Director
3. Shri Bhasker Bhatt : Independent Director
Audit Committee shall have such powers and authority as provided under
the aforesaid provisions and shall act in accordance with the terms of
reference to be specified in writing by the Board of Directors from
time to time.
Fixed Deposits:
Your Company has not invited or accepted any fixed deposits from public
in terms of provisions of Section 58-A of the Companies Act, 1956 read
with the Companies (Acceptance of Deposits) Rules, 1975 and, as such,
no amount of principal or interest was outstanding as of the balance
sheet date.
Insurance:
The Company's properties including Building, Plant and Machinery,
Stocks, Stores, etc., have been adequately insured.
Global Depository Receipts:
Your Company had issued 1,02,35,455 Global Depository Receipts (GDRs),
each representing one equity share of nominal value of Rs. 10/- each
during the financial year 2009-10.
The said GDRs are listed at Euro MTF market of Luxembourg Stock
Exchange.
As on 31st March, 2011, total 3,54,27,275 number of GDRs are
outstanding for conversion.
Transfer to Investor Education and Protection Fund
Your Company sends letters to all shareholders whose dividends are
unclaimed so as to ensure that they receive their rightful dues.
Efforts are also made in co-ordination with the Registrar to locate the
shareholders who have not claimed their dues.
During the year, your Company has transferred a sum of Rs. 87,231/- for
the financial year 2002-03 to Investor Education and Protection Fund,
which was due & payable and remained unclaimed and unpaid for a period
of seven years, as provided in Section 205C(2) of the Companies Act,
1956. Despite the reminder letters sent to each shareholder, this
amount remained unclaimed and hence was transferred.
Infrastructure
Your Company is having all infrastructure facilities required for
running of industry in excellent manner. The plant is located at
National Highway No. 8 and is fully surrounded by developed industries.
The place is also having thick population so manpower is easily
available. The Company has its own labour colony. The power is
constantly available through its Captive Power Plant as well as from
Gujarat Electricity Board. Your Company has its own tube wells to get
sufficient water. The Company is reusing 98% of water and discharge of
water is hardly 2% of total consumption. The units are having
"No-objection" letter from Gujarat Pollution Board for manufacturing
activity of paper.
Awards and Accolades:
- Your Company has been declared as the 1st Highest Importer for the
3rd consecutive year at ICD-Sabarmati by M/s. Container Corporation of
India for the year 2010-11.
- Your Company has also received the Special Award in recognition of
its outstanding export performance in respect of Paper and Paper Board
by CAPEXIL for the second consecutive year.
- Your Company has been upgraded by the Dalal Street from Small Cap to
Mid Cap and Rainbow has been ranked as 208th among top 400 Mid Cap
Companies in India. Previous year, your Company was ranked as 4th among
top 400 Small Cap Companies in India.
- We have been accredited with FSC-COC certification (Forest
Stewardship Council à Chain of Custody).
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings and Outgo:
The particulars as prescribed under section 217 [1] (e) of the
Companies Act, 1956 read with Rule 2 of the Companies [Disclosure of
particulars in the Report of Board of Directors) Rules, 1988 regarding
conservation of energy, technology absorption, foreign exchange
earnings and outgo are given in Annexure ' A' forming part of this
Report.
Particulars of Employees:
The information required as per Sub- Section (2A) of Section 217 of the
Companies Act, 1956 read with Companies ( Particulars of Employees )
Rules, 1975 as amended and forming part of the Directors' Report for
the year ended 31st March, 2011 is enclosed and it is forming part of
the balance sheet.
Corporate Governance:
Our Board with well qualified independent Directors' guidance and team
work and various committees constituted under corporate governance, the
Company is in a position to excel in its activities with complete fair
and transparent practices. The Board committees regularly scrutinize
the policies and proposals made by the operating management and also
provide an unbiased independent assessment of the business procedures.
Pursuant to Clause 49 of the Listing Agreement, Management Discussion
and Analysis Report and a Report on Corporate Governance are given as
Annexure to this Report.
A certificate from the Statutory Auditors of the Company regarding
compliance by the Company of the conditions stipulated under Clause 49
of the Listing Agreement is attached to this Report.
The Company is in process of implementing the Corporate Governance
Voluntary Guidelines 2009, issued by Ministry of Corporate Affairs, in
December, 2009.
Information Technology:
Your Company continues to invest in Information Technology and leverage
it as a source of competitive advantage.
As the IT systems become more sophisticated and mission critical, there
is continuous focus on IT security and on reliable disaster recovery
management processes. These are periodically reviewed and tested to
provide reassurance on their efficacy and adequacy.
Heath, Safety, Security And Environment:
Rainbow Papers Limited has always been emphasing for achieving better
environmental conditions at work place. From time to time various
initiatives have been undertaken such as plantation, installation of
latest technological equipments to reduce waste generation and to
recycle and reuse the waste materials to the maximum possible extent.
The mill development programme undertaken by the Company is an
extension of your Company's commitment to further better our
environment.
The Company takes pride in providing a healthy and safe operating
environment for its employees. It is a recycled based paper unit which
uses the waste paper as raw material for manufacturing its finished
product. Thus, saving the forests which are already in scarcity.
Constant efforts are made to conserve natural resources. During the
year, the Company was able to further reduce its energy and water
consumption per unit by installing new energy meters. The Company
deploys eco-friendly technology to provide a safe and clean environment
in its neighbourhood. It has installed efficient Effluent Treatment
Plants in order to protect the environment. Adequate measures are also
taken for the safety of the workmen working at the plant by providing
them helmets, safety belts etc.
Corporate Social Responsibility:
Corporate Social Responsibility continues to assume an important role
in the activities of the Company. It encompasses much more than social
outreach programs and is an integral part of the way the Company
conducts its business. The Company contributes a part of its income to
social, charitable and cultural organizations. It reaches out with the
objective of improving the quality of life of the economically deprived
people in the places where the Company has a presence.
Your Company is making efforts to promote CSR activities. In lieu of
this, your Company intends to set up a new division under the name of
`Rainbow Institute of Technology & Research' (RITR) for imparting
training relating to paper and power projects. This institute would aim
in imparting practical job oriented training to technical people about
the latest technology in manufacturing of paper and generation of
power.
The Company is also planning to procure services of Senior Technical
persons who are eminent in their respective fields, so as to ensure
smooth functioning of the ensuing institute.
Quality:
In today's global competition and open economy, quality plays a vital
role in marketing the products and stay ahead of others. Therefore,
great emphasis is given to manufacturing products that meet high
standards of quality in the global market and customer satisfaction.
Proactive efforts are directed towards determining customers'
requirements and achieving all-round customer satisfaction. This is
primarily achieved through automated systems (reducing manual handling
to a minimum), high attention to complaint resolution, online
communication and information exchange, quality circles etc.
Your Company has installed latest Quality plus System which ensures and
controls the Quality of its product.
ISO Certifications:
ISO 9001 / ISO 14001 Accreditation
Your Company's Quality Management Systems continue to be covered by the
"ISO 9001" accreditation. Company's Environmental Management System
continues to enjoy "ISO 14001" accreditation.
OHSAS 18001 Certification
Your Company continues to enjoy certification under Occupational Health
and Safety Assessment Series 18001 (OHSAS) which is an International
Standard which facilitates management of Occupational Health and Safety
risks associated with the business of the organization.
Credit Rating:
The current Bank Loan rating as assigned by the CRISIL is as under:-
Sr. Facility Rated Rating
No. Amount
(Rs. in lacs)
1. Cash Credit 4500 BBB-/Stable
2. Term Loan 39761 BBB-/Stable
3. LC & Bank Guarantee 5635 P3
Total 49896
'P3' indicates that the degree of safety regarding timely payment on
the instrument is adequate.
'BBB' are judged to offer a moderate safety with regard to timely
payment of financial obligations for the present.
Cost Auditors:
Pursuant to Section 233-B of the Companies Act, 1956, the Central
Government has ordered that the Company carries out an audit of cost
accounts relating to Paper every year. Mr. V.H. Shah, Cost Accountant,
was appointed as Cost Auditor for the year 2011-12. The Cost Audit
Report for the year 2010-11 will be submitted to the Central Government
on or before the due date.
Dematerialization:
The shares of the Company are in compulsory demat segment and are
available for trading in the depository system of both National
Securities Depository Ltd (NSDL) and the Central Depository Services
India Ltd
(CDSL). As on 31st March 2011, 8,60,95,395 nos. of equity shares
forming 98.71% of the equity share capital of the Company stands
dematerialized.
Listing of Shares:
The equity shares of the Company are presently listed on the Bombay
Stock Exchange Ltd, (BSE) and National Stock Exchange of India Limited
(NSE). The Equity Shares got listed with NSE on 2nd June, 2010. The BSE
& NSE have nation wide terminals and therefore, shareholders/investors
are not facing any difficulty in trading in the shares of the Company
from any part of the Country.
The GDR of the Company are listed on Euro MTF Market of Luxembourg
Stock Exchange As there is no trading activity carried out by the
Ahmedabad Stock Exchange Limited (ASE), your Company made an
application to ASE, for getting its shares delisted from the said
Exchange. The confirmation letter for delisting of shares was received
from Ahmedabad Stock Exchange Limited on 9th July, 2010.
Your Company has paid annual listing fees for financial year 2011-2012
to BSE and NSE. Annual maintenance and listing agency fee for the
calendar year 2011 has been paid by the Company to Luxembourg Stock
Exchange, Luxembourg. Your Company has also paid custodial fees to
National Securities Depository Ltd. and Central Depository Services
(India) Ltd.
Statutory Auditors:
The Auditors, M/s. Talati & Talati, Chartered Accountants, Ahmedabad,
hold office until the conclusion of the ensuing Annual General Meeting
and are recommended for re-appointment. A Certificate from the Auditors
has been received to the effect that their re-appointment, if made,
would be within the limits prescribed under Section 224(1B) of the
Companies Act, 1956.
Auditors' Report:
The notes to the Accounts referred to in the Auditors' Report of M/s.
Talati & Talati, Chartered Accountants, Ahmedabad, are self explanatory
and therefore do not call for any further explanation under Section 217
( 3 ) of the Companies Act, 1956.
Industrial Relations:
Industrial Relations remained cordial throughout the year under review.
Several industrial relation initiatives implemented by the Company have
significantly helped in improving the work culture, enhancing
productivity and enriching the quality of life of the workforce.
Appreciations and Acknowledgements:
Your directors wish to place on record their deep appreciation to
employees at all levels for their hard work, dedication and commitment.
The enthusiasm and unstinting efforts of the employees have enabled the
Company to remain at the forefront of the Industry.
The Board places on record their appreciation for the support and
co-operation received by the Company from its suppliers, redistribution
stockists, retailers, business partners and others associated with the
Company as its trading partners. Your Company looks upon them as
partners in its progress and has shared with them the rewards of
growth. It will be Company's endeavor to build and nurture strong links
with the trade based on mutuality of benefits, respect to and
cooperation with each other, consistent with consumer interests.
Your directors also take this opportunity to thank all investors,
clients, vendors, banks, regulatory and government authorities and
stock exchanges, for their continued support.
For and on behalf of Board of Directors
Place : Ahmedabad (Ajay R. Goenka)
Date : 7th May, 2011 Chairman & Managing Director
Mar 31, 2010
The Directors are pleased to present the 24th Annual Report together
with the Audited financial statement for the financial year ended 31st
March, 2010.
Financial Highlights:
Your Companys performance for the financial year 2009-10 is summarized
below: f
(Rs. In Lacs)
FINANCIAL RESULTS 2009-10 2008-09
Gross Turnover 29280.79 24411.25
Profit before Depreciation, Interest & Tax 6806.41 5.241.72
Depreciation 2402.97 2496.64
Profit before Interest & Tax 4403.44 2745.08
Interest 1289.64 1042.71
Profit before Tax 3113.80 1702.37
Taxation: Less/(Add) Current Tax 527.57 190.80
Wealth Tax 0.03 0.14
MAT Credit Entitlement (185.63) (168.40)
Deferred Tax 413.17 (686.87)
Fringe Benefit Tax - 6.00
NET PROFIT AFTER TAX 2358.66 2360.70
(LessVAdd: Provisions not required,
hence written back 13.57 (5.28)
Less: Prior Period Adjustments (Net) (9.30) (6.99)
BALANCE PROFIT FOR THE YEAR 2362.93 2348.43
Add: Balance brought forward 4583.28 2569.77
NET SURPLUS AVAILABLE FOR APPROPRIATION 6946.21 4918.20
Proposed Dividend 348.87 115.33
Corporate Tax on Dividend 57.94 19.60
Transfer to General Reserve 200.00 200.00
Surplus carried forward to Balance Sheet 6339.40 4583.28
Your Directors are pleased to recommend a Dividend @ Rs. 21- per share
on 1,74,43,460 Equity Shares of Rs.10/- each, which is inclusive of
1,02,35,455 underlying Equity share representing GDRs, (Previous Year
Rs.1.60 per share on 72,08,005 Equity shares of Rs. 10/- each )
absorbing a sum of Rs. 348.87vLacs and Corporate Dividend Tax of Rs.
57.94 Lacs) for the year ended 31st March 2010. The Dividend, when
declared, at the Annual General Meeting of the Company, will be paid to
those shareholders whose names appear on the Register of Members as on
the date of Annual General Meeting.
Your company has entered into one of the best phase of the growth cycle
and aims to be one of the dominant players in the Industry alongwith
fulfilling its obligations to the shareholders, customers, employees
and society as a whole. The financial performance during the year under
review reflects the consistent progress made by the company inspite of
the daunting challenges posed by the Economy and the Market. Your
Company has successfully completed the first phase of the expansion
programme by installing one of the two Paper plants imported from
Germany, having production capacity of 254 TPD. The commercial
production on the said machine was started in September, 2009. The
Company has recently introduced new products such as Printing and
writing papers, Newsprint, Red Maplitho, Indigo Newsprint, Green
Creamwove, Bristol Paper. The total product range of the Company
includes as many as 186 different varieties of paper. The company was
successfully able to raise Rs. 12385 Lacs through GDR during the year
under review.
Your directors are pleased to inform that your company has achieved a
total production of 1,09,055 M.T. as compared to 85,995 M.T. in
previous year. Your Company has established a new benchmark in its
performance recording historically the highest annual sales during the
year under review. The total turnover made is Rs. 29,281 Lacs as
compared to Rs. 24,411 Lacs in the previous year. The net profit earned
by the Company during the current year is Rs. 2363 Lacs as compared to
Rs. 2348 Lacs in the previous year. Abalance of Rs. 6339 Lacs has been
carried forward to the Balance Sheet for the next year. Your Company
has earned an EBIDTA of Rs. 6806 Lacs. The cash profit has also
increased during the year to Rs. 5179 Lacs. All this has been possible
through cost optimization adopted by the company which resulted in
better realization of margins, improved efficiency and higher
productions. This combination favoured well as demand for the products
in the market have also been improved positively. With such strong
achievements and bold results, the Board of directors are pleased to
recommend a dividend of Rs. 2/- for the shareholders on the equity
shares of face value Rs. 10/-.
The promoters always focus on strengthening the company further by
adding capacities and better integration. All this have been possible,
only on account of continuous support of the companys employees who
have made remarkable contribution towards the progress of the company.
Export and Imports
Your company Exported 22,032.59 M.T of paper during the year under
review as compared to 22,904.51 M.T. in the previous year. The exports
accounted to 18.41 % of total sales. The exports proceeds amounted to
Rs. 5391.82 Lacs as compared to Rs.5561.14 Lacs during the previous
year. The Companys products are now being exported to
various countries such as Africa, Middle East, South East Asia, U.S.A.,
U.K., France, Indonesia, Sri Lanka and Bangladesh. Your Company is
making efforts to cater more. and more of foreign markets in the near
future. During the year under review, your company has been awarded the
Special Award in respect of Paper and Paper Board by CAPEXIL, by the
Government of India, Ministry of Commerce, Director General of Foreign
Trade, recognition of its export performance.
Your Company imported 74,324.74 M.T. of waste paper and 522.40 M.T. of
chemical during the year as compared to 31,303.72 M.T. and 188.80 M.T.
respectively in the previous year. The imports amounted to Rs 7143.39
Lacs of waste paper and Rs. 224.16 Lacs of chemicals as compared to Rs.
4198.33 Lacs and Rs. 71.40 Lacs respectively in the previous year. Your
Company has been awarded as 1st largest importer at ICD, Ahmedabad by
"Container Corporation of India Ltd" for year 2009-10.
Market Capitalization:
The market capitalization has increased substantially on account of
better performance resulting into higher share prices and also due to
increased Share Capital of the company. The same is indicated as below
:
Status of Expansion
During the year under review, your Company has taken up the expansion
programme of installation of paper plant imported from Germany. The
total project cost for the said expansion programme was Rs. 32700 Lacs.
The entire project cost included the cost of installation of the plant
already imported from Germany with production capacity of 330 MT per
day, cost of 30MW power plant, deinking plant, pulp mill, technology
upgradation of the imported plant. The project is expected to be
completed by March, 2011. The company has raised the funds for the said
project through GDR issue of Rs. 12385 Lacs and has also arranged a
debt of Rs. 20000 Lacs through a consortium of banks. The balance
project cost shall be met by internal accrurals of the company. With
the completion of this expansion programme, the total production
capacity of the Company would be around 3,05,000 M.T. p.a. These
enhanced capacities will enable increased production and sales,
contributing to the improved performance of the company over the
Financial year 2010-11.
On account of expansion programmes taken up by the Company from time to
time, there has been substantial increase in the production capacity of
the Company, which has increased from 6000 TPA to 305000 TPA.
Similarly, the power generated from the power plant has also increased
from 5MW to 45MW. Below graph describes the enhancement of production
capacity from time to time.
The Indian economy has rebounded strongly with renewed demand for paper
and paper products. The emphasis on primary education, the rise in
demand for newsprint and paper used for packaging will provide a strong
momentum for the demand of paper and paper products. Sensing these
opportunities, your company has future plans of strategic investments
and acquisitions for the purpose of installation and setting up of
Packaging Board Machine and Folding Duplex Board machine. The project
is under active consideration at the management level and also the
technical team is analyzing the feasibility of the same. To carry out
this expansion programme, the Company proposes to raise the funds to
the tune of Rs. 75000 Lacs by way of suitable instruments i.e. ADR/
GDR/ FCCB issue or through equity shares etc. Your Directors would
announce the project with other relevant details as soon as the final
decisions are taken.
Your directors are also exploring and working on the new business lines
which includes manufacturing of bricks and plain and corrugated plastic
sheets. The fly ash which is one of the by product generated out of the
power plant can be utilized for manufacturing of bricks and other
related items. The plastic contents segregated at the time of
processing, from the waste paper can be utilized for manufacturing of
plain and corrugated plastic sheets and other related items. These new
projects would not only increase the profitability of the company but
also would contribute in keeping the environment clean as the discharge
of the fly ash and unutilized plastic contents problem gets solved
automatically.
During the year under review, Shri Rajendra Patawari, Shri Bhasker
Bhatt and Shri ShashikantThakar were appointed as additional directors
on the Board of the Company with effect from 30th January, 2010. They
hold office up to the ensuing Annual General Meeting of the company.
Shri Ashwin Goswami had resigned from the Board of the Company with
effect from 30th June, 2009 and Shri Shankarlal Heda resigned with
effect from 30th January, 2010. Shri Gokuldas Kothari and Shri Kalpesh
Oswal have resigned with effect from 26th February, 2010 and Shri
Mahendra Jindal has resigned on 26th April, 2010.
Shri Champaklal Shah, Shri Radheshyam Goenka and Smt. Sangeeta Goenka,
directors of the Company have also resigned with effect from 28th May,
2010.
Your Company places on record its appreciation for the valuable
services rendered by the above named directors during their
directorship. Your directors also extend a warm welcome to the new
Directors on the Board of the Company.
Directors Resposibilty
Pursuant to the requirements under Sub section 2AA of Section 217 of
the Companies Act, 1956, with respect to the Directors Responsibility
Statement, it is hereby confirmed:-
(1) that in the preparation of Annual Accounts, the applicable
accounting standards have been followed along with the proper
explanation relating to material departures, if any.
(2) that the Directors have selected such accounting policies and
applied them consistently and made judgement and estimates that are
reasonable and prudent so as to give true and fair view of the state of
affairs of the Company as at 31st March, 2010 and of the Profit for the
year ended on that date.
(3) that the Directors to the best of their knowledge and ability have
taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of Companies Act,
1956, for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities.
(4) that the directors have prepared the Annual Accounts on a "going
concern basis".
Audit Committee:
The Audit Committee has also been reconstituted which now consists of
following members:
1. Shri Shashikant Thakar Chairman
2. Shri Rajendra Patawari Independent Director
3. Shri Bhasker Bhatt Independent Director
Fixed Deposits:
Your Company has not invited or accepted any fixed deposits from public
in terms of provisions of Section 58- A of the Companies Act, 1956 read
with the Companies (Acceptance of Deposits) Rules, 1975 and, as such,
no amount of principal or interest was outstanding as of the balance
sheet date.
Insurance:
The Companys properties including Building, Plant and Machinery,
Stocks, Stores, etc., have been adequately insured.
Issue of Global Depository Receipts:
During the year under review, your Company has issued 1,02,35,455
Global Depository Receipts (GDRs), each representing one equity share
of nominal value of Rs. 10/ - each at a offer price of US$ 2.64
aggregating to US$ 2,70,21,601.20.
Your Company had issued GDRs in order to part finance, the total
project cost of Rs. 32700 Lacs for the installation of machinery
imported from Germany. The underlying equity shares were allotted by
the Board of Directors in the Board Meeting held on 28th January, 2010.
The Global Depository Receipts issued by the Company have been listed
on Euro MTF market of Luxembourg Stock Exchange.
Out of the total 1,02,35,455 GDRs issued, 97,85,455 number of GDRs are
outstanding for conversion on 31st March, 2010.
Change in Share Capital:
On account of the GDR issue, the issued and paid up capital of the
Company has increased from Rs. 7,20,80,050/- consisting of 72,08,005
Equity Shares of Rs. 10/- to Rs. 17,44,34,600/- (consisting of
1,74,43,460 Equity shares including 1,02,35,455 underlying Equity
Shares representing GDRs which were allotted on 28th January, 2010 .
The face value of each Equity Share of Rs. 10/- is proposed to be
sub-divided into the face value of Rs. 21- each by corresponding
increase in the number of shares held by each shareholder on the record
date.
Awards and Accolades:
Your Company is a proud recipient of the following awards during the
year:
a) Your Company has been declared and awarded the Highest Importer at
ICD, Ahmedabad by M/s. Container Corporation of India Ltd for the year
2009- 10. The Company has received this award for the sixth consecutive
year wherein for last four years it has received the award as the 2nd
largest Importer.
b) Your Company has also been awarded the Special Award in respect of
Paper and Paper Board by CAPEXIL, by the Government of India, Ministry
of Commerce, Director General of Foreign Trade, recognition of its
export performance.
c) Your Company has also received Certificate of Recognition for
superior financial performance during 2008-09 and has been ranked as
246th in Industry 2.0 top 500 SMBs, which was ranked as 461st in
financial year 2007-08.
d) Your Company continues to enjoy the status of "Star Export House" by
Director General of Foreign Trade, New Delhi.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings and Outgo-
The particulars as prescribed under section 217 [1] (e) of the
Companies Act, 1956 read with Rule 2 of the Companies [Disclosure of
particulars in the Report of Board of Directors) Rules, 1988, regarding
conservation of energy, technology absorption, foreign exchange
earnings and outgo are given in Annexure W forming part of this Report.
Particulars of Employees;
The information required as per sub-section (2A) of Section 217 of the
Companies Act, 1956 read with Companies (Particulars of Employees)
Rules, 1975 as amended and forming part of the Directors Report for
the year ended 31st March 2010 is NIL
Corporate Governance;
Our board with well qualified independent directors guidance and team
work and various committees constituted under corporate governance, the
Company is in a position to excel in its activities with complete fair
and transparent practices. The Board committees regularly scrutinize
the policies and proposals made by the operating management and also
provide an unbiased independent assessment of the business procedures.
Pursuant tc Clause 49 of the Listing Agreement, Management Discussion
and Analysis Report and a Report on Corporate Governance are given as
Annexure to this Report.
A certificate from the Statutory Auditors of the Company regarding
compliance by the Company of the conditions stipulated under Clause 49
of the Listing Agreement is attached to this Report.
The Company is in process of implementing the Corporate Governance
Voluntary Guidelines 2009, issued by Ministry of Corporate Affairs, in
December, 2009.
Information Technology:
Your Company with its all IT initiatives is committed to ensure stable,
operational and responsive- information, communication and ERP System
for efficient and faster business growth.
We aim each year to enhance and associate information technology usage
to simplify business processes, which in turn increases productivity
and profitability.
Health, Safety, Security and
Environment- Rainbow Papers Limited takes pride in providing a healthy
and safe operating environment for its employees. It is a recycled
based paper unit which uses the waste paper as raw material for
manufacturing its finished product. Thus, saving the forests which is
already in scarcity. Constant efforts are made to conserve natural
resources. During the year, the Company was able to further reduce its
energy and water consumption per unit by installing new energy meters.
The Company deploys eco-friendly technology to provide a safe and clean
environment in its neighbourhood. It has installed efficient Effluent
Treatment Plants in order to protect the environment. Adequate measures
are also taken for the safety of the workmen working at the plant by
providing them helmets, safety belts etc.
ISO Certifications:
ISO 9001 / ISO 14001 ACCREDITATION Companys Quality Management Systems
continue to be covered by the "ISO 9001" accreditation. Companys
Environmental Management System continues to enjoy "ISO 14001"
accreditation.
OHSAS 18001 CERTIFICATION
The Company continues to enjoy certification under Occupational Health
and Safety Assessment Series 18001
(OHSAS) which is an International Standard which facilitates management
of Occupational Health and Safety risks associated with the business of
the organization.
Credit Rating:
The current Bank Loan rating as assigned by the CRISIL is as under.-
Sr.
No. Facility Rated Amount (Rs. in Lacs) Rating
1. Cash Credit 4500.00 BBBVStable
2. Term Loan 43465.00 BBBVStable
3. LC & Bank Guarantee 5635.00 P3
Total 53600.00
P3 indicates that the degree of safety regarding timely payment on
the instrument is adequate.
BBB are judged to offer a moderate safety with regard to timely
payment of financial obligations for the present.
Cost Auditors:
Pursuant to Section 233-B of the Companies Act, 1956, the Central
Government has ordered that the Company carries out an audit of cost
accounts relating to Paper, every year. Mr. V.H. Shah, Cost Accountant,
was appointed as Cost Auditor for the year 2009-10. The Cost Audit
Report for the year 2009-10 will be submitted to the Central Government
on or before the due date.
Dematerialisation:
The shares of the Company are in compulsory demat segment and are
available for trading in the depository system of both National
Securities Depository Ltd (NSDL) and the Central Depository Services
India Ltd (CDSL). As on 31st March 2010, 1,71,77,379 nos. of equity
shares forming 98.47% of the equity share capital of the Company stands
dematerialized.
The equity shares of the Company are presently listed on the Bombay
Stock Exchange Ltd (BSE) and Ahmedabad Stock Exchange Limited (ASEL).
The Bombay Stock Exchange Ltd has nation wide terminal and therefore,
shareholders/investors are not facing any difficulty in trading in the
shares of the Company from any part of the Country.
The GDR of the Company are Ijsted on Euro MTF Market of Luxembourg
Stock Exchange.
As there is no trading activity carried out by Ahmedabad Stock Exchange
Limited, your Company has already made an application to Ahmedabad
Stock Exchange Limited, for getting its shares delisted from the said
Exchange. All formalities pertaining to delisting have already been
completed and the confirmation from Ahmedabad Stock Exchange Limited is
awaited.
Your company has completed all the formalities for getting its shares
listed on National Stock Exchange of India Limited (NSE) and the
confirmation for getting listed at NSE is expected very soon. (The
equity shares of the Company have since been listed with National Stock
Exchange of India Limited w.e.f. 2nd June, 2010)
Your Company has paid annual listing fees for financial year 2009-2010
to Bombay Stock Exchange Limited, Mumbai, Ahmedabad Stock Exchange
Limited, Ahmedabad, Luxembourg Stock Exchange, Luxembourg and custodial
fees to National Securities Depository Ltd. and Central Depository
Services (India) Ltd.
Statutory Auditors.*
M/s. Pravin M. Shah & Co., Statutory Auditors of the Company retire at
the ensuing Annual General Meeting of the company and have expressed
their unwillingness for reappointment as Statutory Auditors of the
Company. M/s. Talati & Talati, Chartered Accountants, Ahmedabad, have
given a written confirmation as per the provisions of Section 224(1B)
of Companies Act, 1956, for being appointed as Auditors of your
Company.
Auditors Report:
The notes to the Accounts referred to in the Auditors Report of M/s.
Pravin M. Shah & Co., Chartered Accountants, are self explanatory and
therefore do not call for any further explanation under Section 217 ( 3
) of the Companies Act, 1956.
Change in Registrar and Share Transfer Agents:
Your Company has appointed M/s. Sharepro Services (India) Private
Limited, as the Registrar and Share Transfer Agent w.e.f. 1st March,
2010 in place of M/s. Pinnacle Share Registry Pvt. Ltd.
Industrial Relations:
Industrial Relations remained cordial throughout the year under review.
Several Industrial Relation initiatives implemented by the Company have
significantly helped in improving the work culture, enhancing
productivity and enriching the quality of life of the workforce.
Acknowledgement:
Rainbows strong multi-cultural work force has been the bedrock of the
Companys glorious past. Rainbow is confident that with the commitment
and passion of our people, we will shape a bright future for the
organization.
The Directors acknowledge the continued support and cooperation
received from the Gujarat government, shareholders, participating
banks, customers, suppliers and dealers. We look forward with
confidence, as before, to their support in the years to come.
The Board also wishes to record its sincere appreciation of the total
commitment, dedication and hard work, put in by every member of team
Rainbow.
FOR AND ON BEHALF OF BOARD OF DIRECTORS
(AJAY R. GOENKA)
PLACE:AHMEDABAD CHAIRMAN &
DATE :28th May, 2010 MANAGING DIRECTOR