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Directors Report of Sadhana Nitro Chem Ltd.

Mar 31, 2015

SADHANA NITRO CHEM LIMITED

The Directors take pleasure in presenting the 42"'1 Annual Report together with Audited Financial Statements for the Financial Year ended 31st March, 2015. The Management Discussion and Analysis has also been incorporated into this report.

1 -FINANCIAL RESULTS (Rsin Lacs)

PARTICULARS STANDALONE 2014-15 2013-14 (12 Months) {9 Months)

Revenue from operations (Net) & Other 4841 3366 Income

Profit before Finance Cost, Depreciation, (319) (93)

Exceptional item and Tax

Finance Cost (462) (617)

Depreciation (207) (207)

Profit/(Loss) before exceptional item and (988) (917)

taxation

Exceptional Items 1305 1067

Tax Expense 102 (206)

Profit/(Loss) after tax 419 (56)



CONSOLIDATED 2014-15 2013-14 (12 Months) {9 Months)

Revenue from operations (Net) & Other 4854 3309 Income

Profit before Finance Cost, Depreciation, (355) (108)

Exceptional item and (468) (613) Tax

Finance Cost (207) (207)

Depreciation (1050) (928)

Profit/(Loss) before exceptional item and 1343 1067 taxation

Exceptional Items 102 (206)

Profit/(Loss) after tax 395 (67)

2. DIVIDEND

In view of the past losses, your Directors do not recommend any dividend for the FY 2014-15. During the year the unclaimed dividend pertaining to the financial year 2006-07 was transferred to the Investor Education & Protection Fund (IEPF).

3. REVIEW OF OPERATIONS

The total revenue of your company for the financial year ending 31st March, 2015 has been 74841 lacs (PP{9 months) 7 3366 lacs) registering an increase of about 8% (annualised).

The Company faced liquidity crunch which adversely affected its operational level. This increased cost of production though operating efficiency was in full check.

Prices of raw materials were higher in the first eight months. This affected margins despite improved operating efficiency and keeping overheads under check.

Your Company entered into a long term agreement with its customers for the sale of Chemicals. After commencing business for months, one of the customers was unable to fulfill the contract resulting into termination of agreement and forfeiting of the advance received.

In spite of Working Capital constraints, the Company has taken the rigorous steps to stream line the production level for achieving the optimum operating level.

After written off of the deferred tax, there was profit after tax of7 419 lacs for the year.

3.1 As per Rule 8(1) of Chapter IX - Companies (Accounts) Rules, 2014 - Report on the performance and financial position of its wholly owned subsidiary-Anuchem B.V.B.A. is presented here under.

FINANCIAL HIGHLIGHT OF WHOLLY OWNED SUBSIDIARY COMPANY - ANUCHEM B.V.B.A.

Particulars 2014 (in Euro) 2013 (in Euro)

Turnover 496.581,38 2.197.015,03

Profit before Finance Coal, Depreciation and Tax (34.098,021 (11.154,211

Financial Expenses 1.285,61 1.220,75

Depreciation 0,00 0,00

ProlMLossI before tax expense (35.383,631 (12.374,961

Tax Expense 0,00 0,00

Profit/(Losa) after tax (35.383,631 (12.374,961

4. EXPORTS

Your Company is having status of a "STAR EXPORT HOUSE' granted by Ministry of Commerce, Government of India.

Despite recessionary trend and unfair severe price competition from China, the Exports of your company during the year were Rs.2,714 lacs [(P, P. Rs.2,197 lacs (9 Months)]

Exports constituted about 57% of the overall sales (excluding other income). Company's Exports are well diversified in terms of product range as well as the Countries of Export.

4.1 Export Oriented Unit (EOU)

Your Company has one of its plants Registered as an EOU with the Development Commissioner, SEEPZ which was valid upto 31st March, 2015 and the Company has applied for extension till 31st May, 2015. Thereafter the Company will de-register EOU Plant status to DTA status.

5. FINANCE

5.1 increase in Authorised Share Capital

During the year, the Company has increased its Authorized Share Capital fromRs. 11,00,00,000 to Rs.21,00,00,000 by way of addition of 1,00,00,000 Preference shares off 10/- each.

5.2 Cumulative Non Convertible Preference Share

During the year, the Company has issued and allotted 78,50,000 9% Cumulative Non Convertible Preference Shares on Private Placement basis to its Holding Company - Manekchand Panachand Trading Investment Company Pvt. Ltd. against purchase of Immovable Properly being land and building.

5.3 Deposits

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

5.4 Particulars of Loans, Guarantees or Investments

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given below

Particulars Balance as on 31st Balance aa on 31st March 2015 March 2014

Loans given by the Company - -

Guarantees given by tha - - Company

Investments in foreign Subsidiary and other bodies 879,969 15,72,219 corporate made by the Company

6. CHEMICAL INDUSTRY AND OPPORTUNITIES & THREATS:

Your company is engaged in manufacture of chemical intermediates, heavy organic chemicals and performance chemicals. India emerged as one of the major source for chemical intermediates. The industries witnessed high degree of uncertainty and slow down following global economy pattern. The industry is dependent on the basic petro-chemicals, prices of which were highly volatile during the year. There is severe price competition in the National and International Market.

Your company is in the industry since last over 41 years. It has a very high degree of operating synergy, economies of scale and high quality standards. The products of your company have diverse uses and applications in several industries ranging from paper, pharmaceutical, agro chemicals, thermal dyes, light stabilizer, aerospace dyes and dye intermediates etc. Besides, your company have loyal clientele base, which is well diversified over the World.

The major threat laced by the company are escalating raw material prices, crude oil prices, increasing interest rate and volatile foreign exchange market.

7. MARKET AND OUTLOOK

Your company has healthy order book position. Despite continued slowdown in the Global economies the demand for the products of your company is showing sign of improvement with improved product pricing coupled with favourable exchange rate. Gradual product price increase, improved operating margin and control on overheads are expected to improve the overall performance.

The Company continued to focus on cost control at every level to improve the operational efficiency which alongwith the increased operating level and upward revision of product prices is expected to improve the margin. The rate of flow of orders is encouraging. Production facilities are realigned to meet the demand. Your company, barring unforeseen circumstances, expects to further improve the turn- over and performance.

8. ENVIRONMENT AND SAFETY:

The Company is conscious of the importance of environmentally clean and safe operations. The company's policy requires the conduct of all operations in such manner so as to ensure safety of all concerned, compliance of statutory and industrial requirements for environmental protection and conservation of natural resou rces to the extent possi ble.

9. RESEARCH AND DEVELOPMENT

Your company has continuously attached high priority to the R & D Department which is engaged in developing new processes and further improving the existing processes as an ongoing activity to enable your company to keep pace with technological advancement and improve operating efficiency.

10. HUMAN RESOURCE/INDUSTRIAL RELATIONS:

Human Resource programs and initiatives in SNCL are aligned to meet the business needs. Your company believes in investing in people to develop and expand their capability. The Company has been able to create a favourable work environment that motivates performance, customer focus and innovation SNCL's strategies are based, inter alia, on processes of continuous learning and improvement.

11. RISKS AND CONCERNS:

Macro-economic factors like the slow down, sluggish demand conditions, monetary policy & fiscal policy, unforeseen political and social upheavals, natural calamities may affect the business of your Company as also the industry at large.

With competition intensifying in all segments of the industry, increasing the market shares and the consumer base is a continuing challenge.

Since raw materials form an important component of your company's value chain, cost and availability of some of the key raw materials like benzene, nitric acid, caustic potash, sulphur based chemicals, iron powder are an area of concern.

Your Company has however improved processes for better consumption norms, substituting cheaper raw materials, converting one of the boilers from furnace oil base to Bagasse base. Your company has technological superiority and strong distribution network.

12. ISO CERTIFICATON

Your Company has certification as per ISO 9001-2008 by RINA, ISO 14001:2004 & OHSAS 18001:2O07 granted by the certifying body KBS Certification Services FM. Ltd. for the development and manufacture of Chemical Intermediates.

13. INSURANCE

The assets of your Company are adequately insured. Your Company has also taken out suitable cover for Public Liability.

14. SUBSIDIARIES, JOINT VENTURES AN D ASSOCIATE COMPANIES

a) During the year under review, M/s. An uchemPte. Ltd., Singapore ceased to be the wholly owned su bsidiary of the company. The Company has now only one wholly owned foreign subsidiary viz. Anuchem B.V.B.A. (Belgium), and the Audited Financial Statements of the said subsidiary are considered forthe purpose of preparing Consolidated Financial statements.

b) No Company has become/ceased to be a joint venture or associate during the FY 2014-15.

15. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an adequate Internal Control System commensurate with the size and nature of its business. The internal audit functions is carried out by a separate firm of Chartered Accountants. The quarterly audit reports, including Significant audit observations and corrective actions thereon, are presented to the Chairman of the Audit Committee.

16. VIGIL MECHANISM/WHISTLE BLOWER POLICY AND RISK MANAGEMENT POLICY

The Company has a vigil mechan ism / whistle blower policy which take cognizance of complaints made and suggestions given by employees and others. The Company also adopted Risk Assessment Procedure. The details of the same are mentioned in the Corporate Governance Report.

17. DIRECTORS

a) All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

b) During the year, Shri R. A. Shroff, Director of the company was expired . The Board has put on records the invaluable guidance and advice given by him from time to time during his tenure.

c) During the year, the Central Government has rejected the application made to it for the appointment and payment of Remuneration to Shri. Nitin R. Jani as Whole Time Director & Company Secretary. Shri. Jani then resigned from the office of Whole Time Director & Company Secretary w.e.f. 25th August, 2014. The remuneration paid to him during 01/09/2012 to 25/08/2014 was adjusted against his retirement dues. Considering his association with the company, experience and to comply with the requirement of section 203 of the Companies Act, 2013, Shri Jani has been appointed as the Company Secretary of the Company w.e.f 15th September 2014.

d) At the Annual General Meeting ofthe Company held on 13th August 2012,Shri.AsitD. Javeriwas appointed as Chairman and Managing Director of the Company for a period of 3 years with effect from September 2012. Hence, a Resolution seeking Member's approval for re-appointment of Shri A.D. Javeri as Chairman and Managing Director of the Company for a further period of 3 years with effect from 1st Septe -mber, 2015 is included in the Notice convening the Annual General Meeting.

e) Smt. Seema A. Javeri, Director, who retires by rotation and being eligible, offers herself for re- appointment. A Resolution seeking Member's approval for appointment of Smt. Seema A. Javeri as Executive Director - Administration for a period of 3 years with effect from 1st July 2015 is included in the Notice convening the Annual General Meeting.

17.1 Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and Compliance Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

17.2 Remuneration Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report.

17.3 Meetings

During the year Eight (8) Board Meetings and Six (6) Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. The composition of the Audit Committee as required under Section 177(8) of the Companies Act, 2013 has been mentioned in the Corporate Governance Report.

17.4 Appointment/Resignation of Key Managerial Personnel (KMP)

a) During the year, Shri Nitin R. Jani has resigned from the office of Whole Time Director and Company Secretary w.e.f. 25thAugust, 2014.

b) During the year the following were appointed as the KMP:

SI. Name of KMP Appointed as With effect from

1.Shri. Sanjeev F Shah "Chief Financial 13th August, 2014 Officer (CFO)

2. Shri. Nitin R.Jani Company Secretary 15th September,2014

18. DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134{3)(c) of the Companies Act, 2013:

a. that in the preparation of the annual financial statements for the year ended 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b. that such accounting policies as mentioned in Note No.1 of the Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and pmdent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2015 and of the losses of the Company forthe year ended on that date;

c. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. that the annual financial statements have been prepared on a going concern basis;

e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

f. that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

19. RELATED PARTY TRANSACTIONS

The Company has entered into a Property Purchase Agreement with Manekchand Panachand Trading Investment Co Pvt Ltd the Promoter Holding Company for purchase of the Residential Colony situated at Village Bhuvaneshwar, Taluka Roha, Dist Raigad, against which the Company has issued Preference shares of the Company on private placement basis. This transaction is on an arm's length basis but not in the ordinary course of business of the Company and hence, approval of the members of the Company under Section 188 of Companies Act, 2013 has been obtained. All other related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. However as a matter of abundant caution, prior omnibus approval of Board of Directors and Members of the Company has been obtained under Section 188 of the Companies Act, 2013 for the transactions which are of a foreseen and repetitive nature. Approval of the Audit Committee has been obtained tor all the related party transactions. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company.

The particulars of contracts or arrangements with related parties referred to in subsection (1) of section 188 of the Companies Act, 2013 in the Form AOC-2 is attached as 'Annexure I'.

20. AUDITORS

20.1 Statutory Auditors

The Company's Auditors, Messrs V. SankarAiyar&Co. Chartered Accountants, Mumbai (Firm Regn. No. 109208W) who retire at the ensuing Annual General Meeting of the Company are eligible for reappointment. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed thereunder for reappointment 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.

Members' attention is invited to Note No.31 of the Notes to Accounts with respect to the observation made by the Auditors under "Emphasis of Matter" appearing in the Auditors Report which is self explanatory.

20.2 Cost Auditors

Cost Audit is not applicable to the Company.

20.3 Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s. Makarand M. Joshi & Co., Company Secretaries in Practice, Mumbai, has been appointed to undertake the Secretarial Audit of the Company. The Secretarial Audit Report in form MR-3 is annexed herewith as 'Annexure II'.

With respect to the observations, remarks made in the Secretarial Audit Report, the same has been taken note of and the company is in process to file the relevant forms with the appropriate authority.

21. CORPORATE GOVERNANCE

Revised Clause 49 of the Listing Agreement is not mandatory to the Company however, the Com pany has voluntarily disclosed the Compliance to the best extent possible and accordingly the Management Discussion and Analysis, the Corporate Governance Report, together with the Auditors Certificate on compliance with the conditions of Corporate Governance as laid down are attached alongwith the Annual Report.

22. CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company prepared in accordance with relevant Accounting Standards (AS) viz. AS 21, AS 23 and AS 27 issued by the Institute of Chartered Accountants of India form partofthisAnnual Report.

23. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3}(m) of the Companies Act, 2013 read with Rule 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as 'Annexure III'.

24. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as 'Annexure IV'.

25. PARTICULARS OF EMPLOYEES

There is no Employee drawing Remuneration in excess of the limits prescribed by the Companies Act, 2013. The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request In terms of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees' particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.

26. SIGNIFICANT AND MATERIAL ORDERS PASSED BYTHE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which would impact the goi ng concern status of the Company and its future operations.

27. ACKNOWLEDGEMENTS

Your Directors would like to express their appreciation for the assistance and co-operation received from the Bankers, Central and State Government Departments, customers, vendors, and other business partners. The Directors also wish to place on record their appreciation to all the employees of the Company lor their co-operation and continued contribution to the Company. Last but not least the Directors place on record their gratitude to the Investors, Clients and Shareholders of the Company for their support and trust reposed.


Mar 31, 2014

To the Members of SADHANA NITRO CHEM LIMITED

The Directors have pleasure in presenting to you the 41st Annual Report together with Audited Accounts for the period ended 31st March, 2014 (for 9 Months).

1. FINANCIAL RESULTS

2013-14 2012-13 9 Months Rs. 15 Months Rs.

Sales & Other Income 33,65,99,609 69,26,00,748

Profit before Finance Cost, Depreciation,

Exceptional item and Tax (92,68,968) 6,19,52,613

Finance Cost (6,17,27,307) (10,17,52,717)

Depreciation (2,07,18,630) (3,67,39,899)

Loss before exceptional item and taxation (9,17,14,905) (7,65,40,003)

Profit on sale of assets and investments 10,67,32,123 8,10,56,718

Deferred tax asset written off (2,06,34,594) (2,24,23,071)

Profit/(Loss) after tax (56,17,376) (1,79,06,356)

2. REVIEW OF OPERATIONS

The turnover of your company for 9 months period ending 31st March, 2014 has been Rs. 3,366 lacs (Previous 15 months period Rs. 6,926 lacs) registering a decline of about 19%. The liquidity crunch has adversely affected continuous availability of various inputs which in turn has hampered the smooth production impacting the yield and cost of production. The orders on hand could not be fulfilled due to lower production due to inability to procure various inputs consequent to liquidity constraint. The operations were at lower level due to which the incidence of overheads were high adversely affecting the profitability.

During the period company has further hived off its non-core assets. Your Company was able to sell in last quarter, of its two offices located at Kakad Chambers, Worli, booking profit of Rs. 1,067 lacs.

During the period the Company faced severe strain and constraint on working capital which adversely affected operating level and impacted the overall operating profitability.

After written off of the deferred tax, there was loss after tax of Rs. 56.17 lacs for the period.

3. DIVIDEND

Your Directors, considering above, do not recommend any dividend (P.Y. Nil) for the financial period 2013-14.

4. OUTLOOK

Your company has healthy order book position. Despite continued slowdown in the Global economies the demand for the products of your company is showing sign of improvement with improved product pricing coupled with favourable exchange rate. Gradual product price increase, improved operating margin and stringent control on overheads are expected to improve the overall performance.

The company continued to focus on cost control at every level to improve the operational efficiency which alongwith the increased operating level and upward revision of product prices is expected to improve the margin. The rate of flow of orders is encouraging. Production facilities are realigned to meet the demand. Your company, barring unforeseen circumstances, expects to further improve the turn-over and performance.

5. FINANCE

During the period, company has further hived of its non-core assets which has infused long term owned fund into the operations. The said proceeds were utilised towards pre-payment of WCTL of banks and re-payment of facility granted by the bank which was abruptly withdrawn by the bank. This has enabled the company to partially reduce its borrowings which is expected to result in lower finance cost.

6. EXPORTS

Your Company is having status of a "STAR EXPORT HOUSE" granted by Ministry of Commerce, Government of India.

Despite recessionary trend and unfair severe price competition from China, the Exports of your company during the period were Rs. 2,197 lacs [(P.P. Rs. 5,164 lacs (15 Months)]

Exports constituted about 75% of the overall sales (excluding other income). Company''s Exports are well diversified in terms of product range as well as the Countries of Export.

7. CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement, the Management Discussion and Analysis, the Corporate Governance Report, together with the Auditors Certificate on compliance with the conditions of Corporate Governance as laid down, form part of this Annual Report.

8. EXPORT ORIENTED UNIT (EOU)

Your company has one of its plants Registered as an EOU with the Development Commissioner, SEEPZ Special Economic Zone which is valid upto 31st March, 2015.

9. ISO CERTIFICATON

Your Company has certification as per ISO 14001:2004 & OHSAS 18001:2007 granted by the certifying body KBS Certification Services Pvt. Ltd. for the development and manufacture of Chemical Intermediates.

1 0 . EFFLUENT TREATMENT

Your Company is conscious about its social responsibilities and is committed towards preservation and conservation of environment.

11. RESEARCH AND DEVELOPMENT

Your company has continuously attached high priority to the R & D Department which is engaged in developing new processes and further improving the existing processes as an ongoing activity to enable your company to keep pace with technological advancement and improve operating efficiency.

12. INSURANCE

The assets of your Company are adequately insured. Your Company has also taken suitable cover for Public Liability.

13. FIXED DEPOSITS

No deposit or interest on the same is outstanding as on 31st March, 2014.

14. DIRECTORS

a. Shri A. L. Apte, Director, has resigned due to other commitments outside India. The Board appreciates the valuable guidance and advice given by him from time to time during his more than three decade of association with the Company.

b. Smt. Seema A. Javeri who was appointed by the Board of Directors as an Additional Director of the Company and who holds office upto the date of the ensuing Annual General Meeting in respect of whom the Company has received a notice in writing from some members proposing her for the office of Director.

c. The approval of Central Government for the appointment and payment of Remuneration to Shri N.R. Jani, Whole Time Director & Company Secretary, for the period of three years from 01.09.2012 to 31.08.2015 is awaited.

d. Shri Abhishek A. Javeri, Director, who retires by rotation and being eligible, offers himself for re-appointment.

e. Shri Arvind R. Doshi, Shri Ramesh A. Shroff, Shri Priyam S. Jhaveri, Shri Dhirendra M. Shah & Shri Pradeep N. Desai are proposed to be re-appointed as Independent Directors of the Company to hold office for 5 (Five) consecutive Years upto the conclusion of 46th Annual General Meeting to be held in calender year 2019.

15. COST AUDIT

On the recommendation of Audit Committee the Board has appointed M/s. Vinay Mulay & Co, Cost Accountants, Mumbai, to audit the cost records of the Company for the financial year ending 31st March, 2015.

16. AUDITORS

M/s. V. Sankar Aiyar & Co. Chartered Accountants, Auditors of your Company, retire at the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Notes forming part of the Accounts referred to in Auditors'' Report of the Company are self-explanatory and, therefore, do not call for any further explanation under Section 217(3) of the Companies Act, 1956.

17. SECRETARIAL AUDIT

On the recommendation of Audit Committee the Board has appointed M/s. Makarand Joshi & Company, Practicing Company Secretary, as the Secretarial Auditor of the Company for the financial year ending 31st March, 2015.

18. SUBSIDIARIES

Pursuant to the provisions of Section 212 of the Companies Act 1956, the Annual Accounts of Anuchem B.V.B.A. (Belgium) and Anuchem Pte. Ltd. (Singapore), wholly owned foreign subsidiaries of your company, is attached.

In compliance with accounting standard AS-21, your company has attached the consolidated statement of account giving therein the consolidated financial statement relating to the company and its subsidiaries.

19. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS / OUTGO

The information required under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 with respect to these matters are given in Annexure-I appended hereto and forms part of this Report.

20. EMPLOYEES

The industrial relations during the year were cordial.

There is no Employee drawing Remuneration in excess of the limits prescribed by the Companies (Particulars of Employees) Rules, 1975.

21. DIRECTORS'' RESPONSIBILITY STATEMENT

As required under Section 217 of the Companies Act, the Directors hereby confirm that :

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

ii) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the Company for that period :

iii) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities :

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

22. ACKNOWLEDGEMENTS

Your Directors would like to express their appreciation for the assistance and co-operation received from the Bankers State Bank of India, Mumbai and Roha, Axis Bank Limited and State Bank of Patiala. They also wish to place on record their appreciation for the co-operation and contribution of the staff and workmen in the achievements of your Company during the year under report. Last but not least the Directors place on record their gratitude to the Investors, Clients and Shareholders of the Company for their support and trust reposed.

For and On Behalf of the Board of Directors

Place : Mumbai Asit D. Javeri

Date : 27th May, 2014 Chairman & Managing Director


Jun 30, 2013

To the Members of SADHANA NITRO CHEM LIMITED

The Directors have pleasure in presenting to you the 40th Annual Report together with Audited Accounts for the period ended 30th June, 2013 (for 15 Months).

1. FINANCIAL RESULTS 2012-13 2011-12 15 Months 12 Months

Sales & Other Income 69,26,00,748 67,06,89,309

Profit before Finance Cost, Depreciation,

Exceptional item and Tax 6,19,52,613 8,61,09,212

Finance Cost (10,17,52,717) (6,63,93,630)

Depreciation (3,67,39,899) (3,15,62,932)

Loss before exceptional item and taxation (7,65,40,003) (1,18,47,350)

Profit on sale of assets and investments 8,10,56,718

Deferred tax asset written off (2,24,23,071) (18,89,599)

Excess provision for tax written back 2,45,80,724

Profit/(Loss) after tax (1,79,06,356) 1,08,43,775

2. REVIEW OF OPERATIO NS

Your company, in view of good order position, could have achieved higher turnover but for paucity of working capital which hampered the regular and continuous procurement of raw materials and input services to ensure uninterrupted requisite level of operation. Your company has attained turnover of Rs. 6,925 lacs (P.Y. Rs. 6,706 lacs).

All direct and indirect cost except finance cost are under stringent monitoring and control. All efforts are made to enhance efficiency by improving yield. The adverse effect of slowdown in major economies and stiff price competition were mitigated by adopting aggressive marketing strategy and stringent quality standard which are the back bone of the company. As a result the margins on products have shown improvement despite lower level of operation.

The operating margin are burdened with heavy finance cost consequent to costly short term borrowings to fund the past losses caused by extra ordinary circumstances and huge installment repayment obligations to the banks coupled with this was huge provisioning of mark to market foreign exchange liabilities.

Beneficial effects of steps taken to improve yield, depreciating rupee against US dollar, better sales pricing and product mix were washed out by the effect of above adverse factors.

During the period company has raised share capital by Rs. 175 lacs by allotment of 1750000 9% Non- convertible cumulative redeemable preference shares ofRs. 10/- each on preferential basis to promoters and/or holding company. To hive off non-core assets your company has (a) sold its investment in Lifestyle Networks Limited at Rs. 76.50 lacs (b) sold its land at Roha alongwith Colony at aggregate consideration of Rs. 785 lacs.

3. DIVIDEND

Your Directors, considering above, do not recommend any dividend (P.Y. Nil) for the financial period 2012-13.

4. OUTLOOK

Your company has healthy order book position. Despite continued slowdown in the Global economies the demand for the products of your company is showing sign of improvement with improved product pricing coupled with favourable exchange rate. Gradual product price increase, improved operating efficiency and stringent control on overheads are expected to improve the overall performance.

The company continued to focus on cost control at every level to improve the operational efficiency which alongwith the increased operating level and upward revision of product prices is expected to improve the margin. The rate of flow of orders is encouraging. Production facilities are realigned to meet the demand. Your company barring unforeseen circumstances expects to further improve the turn-over and performance.

5. FINANCE

During the period company has raised share capital by Rs. 175 lacs by allotment of 1750000 9% Non- convertible cumulative redeemable preference shares of Rs. 10/- each on preferential basis to promoters and/or holding company. To hive off non-core assets of the company your company has (a) sold its investment in Lifestyle Networks Limited at Rs. 76.50 lacs (b) sold its land at Roha alongwith Colony at aggregate consideration of Rs. 785 lacs.

The term loan availed by the company from all the 3 bankers were fully repaid. From the working capital limits Rs. 1,275 lacs were carved out and converted into working capital term loans of which company has repaid Rs. 595 lacs to the banks causing strain on working capital for operations. The company had to resort to short term borrowings, which are unsecure but costlier, for its finance requirement. Your company has repaid during the year term loan installments of more than Rs. 710 lacs to the Banks consequently the Banks'' Working Capital Term Loan liability have substantially reduced.

This caused severe strain and constraint on working capital which adversely affected operating level and impacted the overall operating profitability.

6. EXPORTS

Your Company is having status of a "STAR EXPORT HOUSE" granted by Ministry of Commerce, Government of India.

Despite recessionary trend and unfair severe price competition from China, the Exports of your company during the period were Rs. 5,164 lacs (Rs. 5,318 lacs P.Y)

Exports constituted about 75% of the overall sales (excluding other income). Company''s Exports are well diversified in terms of product range as well as the Countries of Export.

7. CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement, the Management Discussion and Analysis, the Corporate Governance Report, together with the Auditors Certificate on compliance with the conditions of Corporate Governance as laid down, form part of this Annual Report.

8. EXPORT ORIENTED UNIT (EOU)

Your company has one of its plants Registered as an EOU with the Development Commissioner, SEEPZ Special Economic Zone which is valid upto 31st March, 2015.

9. ISOCERTIFICATON

Your Company has certification as per ISO 14001:2004 & OHSAS 18001:2007 granted by the certifying body KBS Certification Services Pvt. Ltd. for the development and manufacture of Chemical Intermediates.

10. EFFLUENT TREATMENT

Your Company is conscious about its social responsibilities and is committed towards preservation and conservation of environment.

11. RESEARCH AND DEVELOPMENT

Your company has continuously attached high priority to the R & D Department which is engaged in developing new processes and further improving the existing processes as an ongoing activity to enable your company to keep pace with technological advancement and improve operating efficiency.

12. INSURANCE

The assets of your Company are adequately insured. Your Company has also taken out suitable cover for Public Liability.

13. FIXED DEPOSITS

The total Deposits accepted by your Company as on 30th June, 2013 is Rs. Nil. There is no Deposit or Interest on the same which has matured and remained unpaid.

14. DIRECTORS

The approval of Central Government for the appointment and payment of Remuneration to Shri A.D. Javeri as Chairman & Managing Director for the period of three years from 01.09.2012 to 31.08.2015 has been received on the terms and conditions mentioned in the said approval letter.

The approval of Central Government for the appointment and payment of Remuneration to Shri N.R. Jani, Director & Company Secretary, for the period of three years from 01.09.2012 to 31.08.2015 is awaited.

Directors, Shri D.M. Shah and Shri Abhishek A. Javeri, retire by rotation and being eligible, offer themselves for re-appointment.

15. COST AUDIT

As per the requirement of the Central Govt, and pursuant to Section 233B of the Companies Act, 1956, the Company carries out an audit of cost accounts relating to its product every year. Subject to the approval of Central Government, the Company has appointed M/s. Vinay Mulay & Co, Cost Accountants, Mumbai, to audit the cost accounts relating to its products for the financial year 2012-13. The Cost Audit Report for the year ending 31st March, 2012 has been filed on 11.05.2012.

Cost Audit for the financial period ending 30th June, 2013 is in progress and the same will be filed soon.

16. AUDITORS

Messrs V. Sankar Aiyar & Co. Chartered Accountants, Auditors of your Company, retire at the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

17. SUBSIDIARY

Pursuant to the provisions of Section 212 of the Companies Act 1956, the Annual Accounts ofAnuchem B.V.B.A. (Belgium), Anuchem Pte. Ltd. (Singapore), wholly owned foreign subsidiaries of your company, is attached.

Lifestyle Networks Limited ceased to be subsidiary of the company during the year.

In compliance with accounting standard AS-21, your company has attached the consolidated statement of account giving therein the consolidated financial statement relating to the company and its subsidiaries.

18. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS / OUTGO

The information required under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 with respect to these matters are given in Annexure-I appended hereto and forms part of this Report.

19. EMPLOYEES

The industrial relations during the year were cordial.

There is no Employee drawing Remuneration in excess of the limits prescribed by the Companies (Particulars of Employees) Rules, 1975.

20. DIRECTORS'' RESPONSIBILITY STATEMENT

As required under Section 217 of the Companies Act, the Directors hereby confirm that:

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

ii) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the Company for that period:

iii) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities:

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

21. ACKNOWLEDGEMENTS

Your Directors would like to express their appreciation for the assistance and co-operation received from the Bankers State Bank of India, Mumbai and Roha, Axis Bank Limited and State Bank of Patiala. They also wish to place on record their appreciation for the co-operation and contribution of the staff and workmen in the achievements of your Company during the year under report. Last but not least the Directors place on record their gratitude to the Investors, Depositors, Clients and Shareholders of the Company for their support and trust reposed.

For and On Behalf of the Board of Directors

Place : Mumbai AsitD. Javeri

Date : 28th August, 2013 Chairman & Managing Director


Mar 31, 2012

To the Members of SADHANA NITRO CHEM LIMITED

The Directors have pleasure in presenting to you the 39th Annual Report together with Audited Accounts for the year ended 31st March, 2012.

1. FINANCIAL RESULTS 2011-12 2010-11

Sales & Other Income 67,06,89,309 55,91,34,860

Profit before Finance Cost, Depreciation and Tax 8,61,09,212 3,56,28,325

Finance Cost (6,63,93,630) (5,14,15,947)

Depreciation (3,15,62,932) (3,35,91,323)

Loss before Taxation (1,18,47,350) (4,93,78,945)

Deferred tax (18,89,599) (8,78,361)

Excess provision for tax written back 2,45,80,724 (25,00,000)

Profit/(Loss) after tax 1,08,43,775 (5,27,57,305)

Balance brought forward from previous year (21,44,26,293) (16,16,68,987)

Balance Transferred to Balance Sheet (20,35,82,519) (21,44,26,293)

2. REVIEW OF OPERATIONS

Your company has attained turnover of Rs 6706 lacs (P.Y. Rs 5591 lacs) registering a commendable growth of about 20%. This has been in the wake of slowdown in the major economies and stiff price competition from China. Aggressive marketing strategy and stringent quality standard has been the backbone of the achievement.

Escalating prices of several inputs, hike in prices of fuel, span of irregularity in the availability of raw material and consequent interruption in production has an effect of increase in costs. The regime of high interest rate and liquidity tightness has increased finance cost burden.

During the later part of the year, depreciating rupee has marginally improved the realisation. All efforts are made to enhance productivity by improving consumption norm and processes. The costs at all level continue to remain under stringent monitoring and control, as' result of which all overheads but for finance cost has shown improvement as a percentage to turnover.

During the year company has EBIDT of Rs 861 lacs (P.Y. Rs 356 lacs). After providing of increased finance cost ofRs 664 lacs (P.Y. loss Rs 514 lacs) the company has achieved cash profit of Rs 197 lacs (P.Y. cash loss of Rs158 lacs). Based on favourable Supreme Court judgment, major tax demand will be quashed resulting in excess tax provision of f 246 lacs which is written back. The profit after tax has been Rs 108 lacs (P.Y. loss Rs 527 lacs).

3. DIVIDEND

Your Directors, considering above, do not recommend any dividend (P.Y. Nil) for the year 2011-12.

4. OUTLOOK

Your company's major market like Europe, Japan and USA are slow but showing singns of recovery in the demand for the product of your company. The market remained highly price competitive. The costs are under stringent monitoring and control. The company has taken several initiatives for process upgradation, improvement in consumption norms, use of cheaper alternate raw material and fuel. All efforts are made to reduce and control the overheads. Finance cost continued to remain high due to high interest rate regime and liquidity crunch consequent to repayment of term loan installments and operational performance. Gradual product price increase, improved operating efficiency and stringent control of overheads are expected to improve the overall performance.

Export continues to constitute about 80% of the overall turn-over. Performance of your company hence mainly follows the Global economy trend. The order book position is healthy. Due to interruption in the smooth availability of raw materials consequent to the liquidity crunch, continuous production was hampered resulting in escalated production cost.

As a strategy, the company is focusing on improving utilisation of the existing capacities. The process for manufacture of sensitizer used in paper coating alongwith Colour Former has been developed in R&D of the company. Commercial production of the same is expected in the current year utilizing the existing capacity. As a result of aggressive marketing efforts, your company is in advance stage of negotiation with several multinational companies consuming Nitrobenzene in large quantity. This will improve the utilisation of Nitrobenzene plant. Both these will contribute substantially to the top line of the company as well as improve the over all performance of the company.

The company continued to focus on cost control at every level to improve the operational efficiency which alongwith the increased operating level and upward revision of product prices is expected to improve the margin.The rate of flow of orders is encouraging. Production facilities are realigned to meet the demand. Your company barring unforeseen circumstances, expects to further improve the turn-over and performance.

5. FINANCE

Majority of INR term loans have been converted into USD FC loans at LIBOR related interest rates. Besides majority of working capital facility is availed in the form of PCFC which carries LIBOR related interest. Pending enhancement of working capital facilities by Bankers, the company had to resort to short term ICD borrowings which are unsecure but costlier. Your company has repaid during the year term loan installments of mere than Rs 700 lacs to the Banks consequently the Banks' term loan liability have substantially reduced.

6. EXPORTS

Your Company is having status of a "STAR EXPORT HOUSE" granted by Ministry of Commerce, Government of India.

Despite recessionary trend and unfair severe price competition from China, the Exports of your company during the year rose to Rs 5,313 lacs compared to Rs 4,462 lacs in the previous year, registering a increase of more than 19%.

Exports constituted about 80% of the overall sales (excluding other income). Company's Exports are well diversified in terms of product range as well as the Countries of Export.

7. CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement, the Management Discussion and Analysis, the Corporate Governance Report, together with the Auditors Certificate on compliance with the conditions of Corporate Governance as laid down, form part of this Annual Report.

8. EXPORT ORIENTED UNIT (EOU)

Your company has one of its plants Registered as an EOU with the Development Commissioner, SEEPZ Special Economic Zone. The Registration of the unit which had expired has been renewed upto 9th March, 2015 and further the company has also been issued Green Card valid upto 31st March, 2015.

9. ISO CERTIFICATON

Your Company has certification as per ISO 9001:2000 granted by the certifying body Registro Italiano Navele India Private Limited (RINA) for the development and manufacture of Chemical Intermediates.

Your company has started the process to get itself accreditation for ISO 14000 & ISO 18000.

10. EFFLUENT TREATMENT

Your Company is conscious about its social responsibilities and is committed towards preservation and conservation of environment.

11. RESEARCH AND DEVELOPMENT

Your company has continuously attached high priority to the R & D Department which is engaged in developing new processes and further improving the existing processes as an on going activity to enable your company to keep pace with technological advancement and improve operating efficiency.

12. INSURANCE

The assets of your Company are adequately insured. Your Company has also taken out suitable cover for Public Liability.

13. FIXED DEPOSITS

The total Deposits accepted by your Company as on 31st March, 2012 is Rs 209.31 Lacs. There is no Deposit or Interest on the same which has matured and remained unpaid.

14. DIRECTORS

The terms of appointment of Shri A.D. Javeri as Chairman & Managing Director and Shri N.R. Jani as Director & Company Secretary is expiring on 31st August, 2012. Your Directors, subject to approval of the members in the General Meeting and subject to approval of Government of India have reappointed Shri A.D. Javeri as Chairman & Managing Director and Shri N.R. Jani as Director & Company Secretary of your Company. Their re-appointment are on the term & condition Recommended by Remuneration Committee. Special Resolutions in these behalf are proposed to be passed at the ensuing Annual General Meeting.

Directors, Shri R.A. Shroff and Shri A.R. Doshi, retire by rotation and being eligible offer themselves for re-appointment.

15. COST AUDIT

As per the requirement of the Central Govt, and pursuant to Section 233B of the Companies Act, 1956, the Company carries out an audit of cost accounts relating to its product every year. Subject to the approval of Central Government, the Company has appointed M/s. Vinay Mulay & Co, Cost Accountants, Mumbai, to audit the cost accounts relating to its products for the financial year 2011-12. The Cost Audit Report for the year ending 31st March, 2011 has been filed on 12th December, 2011 Cost Audit for the year ending 31st March, 2012 is in progress and the same will be filed soon.

16. AUDITORS

Messrs V. Sankar Aiyar & Co. Chartered Accountants, Auditors of your Company, retire at the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

17. SUBSIDIARY

In case of one of the subsidiaries M/s. Lifestyle Networks Limited, whose accumulated loss had exceeded its paid up capital, is now in profit.

Pursuant to the provisions of Section 212 of the Companies Act 1956, the Annual Accounts of Anuchem B.V.B.A. (Belgium), Anuchem Pte. Ltd. (Singapore), wholly owned foreign subsidiaries and Lifestyle Networks Limited, a partly owned Indian subsidiary of your company, are attached.

In compliance with accounting standard AS-21, your company has attached the consolidated statement of account giving therein the consolidated financial statement relating to the company and its subsidiaries.

18. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS / OUTGO

The information required under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 with respect to these matters are given in Annexure-I appended hereto and forms part of this Report.

19. EMPLOYEES

The industrial relations during the year were cordial.

There is no Employee drawing Remuneration in excess of the limits prescribed by the Companies (Particulars of Employees) Rules, 1975.

20. DIRECTORS' RESPONSIBILITY STATEMENT

As required under Section 217 of the Companies Act, the Directors hereby confirm that:

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

ii) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the Company for that period:

iii) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities:

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

21. ACKNOWLEDGEMENTS

Your Directors would like to express their appreciation for the assistance and co-operation received from the Bankers State Bank of India, Mumbai and Roha, Axis Bank Limited and State Bank of Patiala. They also wish to place on record their appreciation for the co-operation and contribution of the staff and workmen in the achievements of your Company during the year under report. Last but not least the Directors place on record their gratitude to the Investors, Depositors, Clients and Shareholders of the Company for their support and trust reposed.

For and On Behalf of the Board of Directors

Place : Mumbai AsitD. Javeri

Date : 18th June, 2012 Chairman & Managing Director


Mar 31, 2010

The Directors have pleasure in presenting to you the 37th Annual Report together with Audited Accounts for the year ended 31st March, 2010.

1. FINANCIAL RESULTS 2009-10 2008-09

Rs. Rs.

Turnover and -Other Income 36,31,99,750 78,86,91,690

(Loss)/Profit before Effect of Foreign Exchange

Contracts, Exceptional Items, Finance cost,

Depreciation and Taxation (1,67,217) 11,11,27,250

Finance Cost (5,50,88,048) (5,60,73,917)

Depreciation (3,44,23,222) (3,74,20,074)

(Loss)/Profit before Effect of Foreign Exchange

Contracts, Exceptional Items, and taxation (8,96,78,487) 1,76,33,259

Forex (Loss)/Gain - (11,87,46,163)

Exceptional Items - (56,92,481)

Loss before Tax (8,96,78,487) (10,68,05,385)

Provision for taxation (4,05,000)

Deferred tax (Debit)/Credit (20,15,772) 1,66,28,434

Loss after tax (9,16,94,259) (9,05,81,951)

Balance brought forward from previous year (6,99,74,728) 2,06,07,223

16,16,68,987 (6,99,74,728)



2. REVIEW OF OPERATIONS

Your companys major markets like Europe, Japan and USA continued to remain under severe recessionary trend for the products of your company during the year under report. Unhealthy competition from certain countries further aggravated the market conditions. Market condition during the year under report continued to be subdued and highly price competitive. Turnover of your company for the year sharply declined to Rs. 3,632 Lacs as against Rs. 7,887 Lacs in the P.Y. registering a decline of over 53%.

The costs were under close monitoring and stringent control. The company has taken several initiatives like process improvement, lower consumption norms, use of cheaper alternate raw material and fuel. All efforts were made to reduce and control the overheads. Finance cost continued to remain high in view of the liquidity tightness.

Gradual product price increase, improved operating efficiency and stringent control of overheads have, to an extent mitigated the adverse impact of decline in turnover due to above extraneous factors. Your companys operations during the year resulted into a loss after tax of Rs. 916.99 lacs (P.Y. Rs. 905.81 lacs).

3. DIVIDEND

Your Directors, considering above, do not recommend any dividend (P.Y. Nil) for the year 2009-10.

4. PROJECTS

During the year your Company has converted one of its furnace oil based boiler to Bagasse based boiler. Conversion to Bagasse is mainly due to three reasons (1) insulate against high volatility of oil prices, which incidentally are on the rise and have touched USD 80 to a barrel, (2) to be more eco-friendly and green emission and (3) reduced cost of production. The company has also carried out several process changes to improve the operating efriciency. In view of the lower turnover, expected benefit of such measures could not be reaped to the fullest extent.

5. OUTLOOK

Your company having about 80% of the revenue from export, follows the gloual economics trend. The first quarter of the current year witnessed improved order book position. Due to interruption in the smooth availability of raw material and the liquidity tightness continous production was hampered resulting in escalated production cost. As a result entire order book could not be catered to as scheduled during the first quarter.

The rate of flow of orders is encouraging. Production facilities are realigned to meet the demand. Your company barring unforeseen circumstances experts good improvement in turnover. The company continued to focus on cost control at every level to i -nprove the operation efficiency which alongwith the increased operating level and upward revision of product prices is expected to improve the margin.

Unaudited estimated sales for the first quarter 01 2010-11 was at Rs. 1,170 lacs (P.Y. Rs. 993 lacs ) and the loss after tax was at Rs. 134 lacs (P.Y. Rs. 159 lacs).

S. DEBT RESCHEDULING

Foreseeing the squeeze cr liquidity and profitability, company approached its banker to reschedule its facilities. In view of genuineness of the case, bankers or your company rescheduled the repayment of sanctioned Loans as well as extended additional facility to, meet cash flow requirements, of the company.

Your company has repaid fully the term loan cf Rs. 1050 lacs availed from Axis Bank Ltd and Rs. 562 Lacs availed from Exirn Bank Lid.

7. EXPORTS

Your Company is having status of a TWO STAR EXPORT R OUSE granted by Ministy of Commerce, Government of India.

Due to recessionary trend and unfair severe price competiton. from China, the exports of your company during the year were Rs. 2798 Lacs compared to Rs. 5786 lacs in the previous year, registeing a decrease of 58.76%.

Exports constituted more than 80% of of have omi! Seess (excluding other income). Companys Exports are well diversified in terms of product range as well as the Countries of Export.

8. CORPORATE ATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreenent, the Mznavgament Discussion and Analysis, the Corporate Governance Report, together with the A Auditors Certificate on compliance with the conditions of Corporate Governanca as laid down, form part of this Annua! Report.

9. EXPORT ORIENTED UNIT (EOU)

Your Company has one of its plant registered as an EOU with the Development Commissioner, SEEPZ Special Economic Zone. The Registration of the unit which had expired has been renewed for further five years upto 09.03.2015 and further the company has also been issued Green Card valid upto 31.03.2015. The Board took note of the same.

10. ISO CERTIFICATION

Your Company has certification as per ISO 9001:2000 granted by the certifying body Registro Italiano Navele India Private Limited (RINA) for the development and manufacture of Chemical Intermediates.

11. EFFLUENTTREATMENT

Your Company is conscious about its social responsibilities and is committed towards preservation and conservation of environment.

12. RESEARCH AND DEVELOPMENT

Your company has continuously attached high priority to the R & D Department which is engaged in developing new processes and further improving the existing processes as an on going activity to enable your company to keep pace with technological advancement and improve operating efficiency.

13. INSURANCE

The assets of your Company are adequately insured. Your Company has also taken out suitable cover for Public Liability.

14. FIXED DEPOSITS

The total Deposits accepted by your Company as on 31st March, 2010 is Rs. 287.49 Lacs. There is no Deposit or Interest on the same which has matured and remained unpaid.

15. DIRECTORS

The approval of Central Government for the appointment and payment of Remuneration to Shri A.D. Javeri as Chairman & Managing Director and Shri N.R. Jani as Director & Company Secretary for the period of threo years from 1.9.2009 to 31.8.2012 has been received on the terms and conditions mentioned in their respective approval letters.

Directors .shri D.M. Shah and Shri Abhishek A. Javeri, retire by rotation and being eligible offer themselves for reappointment.

16. Auorroas

Messrs V. Sankar Aiyar & Co. Chartered Accountants, (Firm Regn. No. 109208W) Auditors of your Company, retires at the conclusion of the ensuing Annual General Meeting and are eligible for re- appointment

17. SUBSIDIARY

in case of one of the subsidiaries Lifestyle Networks Limited (LNL), the accumulated loss has exceeded its paid up capital. LNL in Joint Venture with Chandra Net Pvt. Ltd. has been able to successfully role out fixed wireless network of 90 sq. km. in Ahmedabad under the brand name of SPIDIGO. The network started functioning from September 2009 and has more than 170000 customers.

During the year LNL has repaid the company Rs. 3.72 Crores of loans advanced to it.

Pursuant to the provisions of Section 212 of the Companies Act 1956, the Annual Accounts of Anuchem B.V.B.A. (Belgium), Anuchem Pte. Ltd. (Singapore), wholly owned foreign subsidiaries and Lifestyle Networks Limited a partly owned Indian subsidiary of your company are attached.

In compliance with accounting standard AS-21, your company has attached the consolidated statement of account giving therein the consolidated financial statement relating to the company and its subsidiaries.

18. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO

The information required under Section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 with respect to these matters are given in Annexure-I appended hereto and forms part of this Report.

19. EMPLOYEES

The industrial relations during the year were cordial.

The Particulars of the Employees pursuant to Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 is given in Annexure-ll appended here to and Forms part of the report.

20. DIRECTORS RESPONSIBILITY STATEMENT

As required under Section 217 of the Companies Act, the Directors hereby confirm that:

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

ii) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the Company for that period;

iii) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

21. ACKNOWLEDGEMENTS

Your Directors would like to express their appreciation for the assistance and co-operation received from the Bankers, State Bank of India, Mumbai and Roha, Axis Bank Limited, State Bank of Patiala and Exim Bank of India. They also wish to place on record their appreciation for the co-operation and contribution of the staff and workmen in the working of your Company during the year under report.

For and On Behalf of the Board of Directors

Place : Mumbai Asit D. Javeri

Date : 29th July, 2010 Chairman & Managing Director

 
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